UPM Annual Report 2023

ACCOUNTS FOR 2023

UPM

BEYOND FOSSILS

BUSINESSES

RESPONSIBILITY

GOVERNANCE

9. Unrecognised items 9.1 Commitments and contingencies

10. Other notes 10.1 Forthcoming new standards, amendments and accounting policy changes Certain new accounting standard amendments and interpretations have been published that come into effect only after the reporting period started on 1 January 2023. These standards and amendments are not expected to have a material impact on the group in the current or future reporting periods and on foreseeable future transactions and have not been early adopted.

Parent company accounts (Finnish Accounting Standards, FAS) Income statement

In the normal course of business, UPM enters into various agreements providing financial or performance assurance to third parties. The maximum amounts of future payments for which UPM is liable is disclosed in the table below under “Other commitments”. Property under mortgages given as collateral for own commitments include property, plant and equipment, industrial estates and forest land.

EURm

NOTE

2023 2,585

2022 2,414

Sales

1

Change in inventories of finished goods and work in progress

10

15

Production for own use Other operating income

1

2

EURm

2023 2022

2

103

81

On behalf of others Guarantees

Materials and services Raw materials and consumables purchased

—

2

-1,935

-1,449

Other own commitments Leasing commitments for the next 12 months in accordance with IFRS 16

Change in inventories

-43

-98

External charges

-8

-6

2

2

-1,987

-1,553

Other commitments

99

219 223

Personnel expenses Salaries and fees

Total

101

-198

-194

Indirect employee costs Pension costs

The lease commitments for leases not commenced at the end of 2023 totals approximately EUR 176 million, which are mostly related to a railway service agreement in Uruguay and a service agreement related to waste water treatment in Leuna, Germany. Lease commitments at the end of 2022 amounted to EUR 245 million. The decrease in other commitments during the period is mainly due to the PVO loan commitment, which matured at the end of 2023.

-36

95

Other indirect employee costs

-7

-7

3

-241

-106

Depreciation, amortisation and impairment charges Depreciation and amortisation

-112 -112 -349

-117 -117 -289 446

4 5

Other operating expenses Operating profit (loss)

9.2 Litigation Contingent liabilities

10

Financial income and expenses Income from non-current assets Dividend income from group companies Interest income from group companies Other interest and financial income Other interest income from group companies Other interest income from other companies Other financial income from group companies Other financial income from other companies Impairment charges and reversals on investments

The group is defendant or plaintiff in a number of legal proceedings incidental to its operations. These lawsuits primarily involve claims arising from commercial law issues. Group companies The Group’s management is not aware of any significant litigation at the end of 2023. In October 2021, the European Commission conducted an unannounced inspection at UPM’s premises. According to the Commission’s press release on 12 October 2021, the Commission had concerns that the inspected companies in the wood pulp sector may have violated EU antitrust rules that prohibit cartels and restrictive business practices. On 15 June 2023 the Commission published a release that it had decided to close its antitrust investigation in the wood pulp sector. According to the Commission's release, it had decided to close the investigation after a thorough analysis and careful assessment of all the evidence gathered. 9.3 Events after the balance sheet date On 2 January 2024, UPM announced that it has completed the sale of Steyrermühl site and all related assets to HEINZEL GROUP, thereby closing the transaction announced in June 2022.

738

293

5

16

150

63

30

6

1

77

974

0

9

-62

Interest and other financial expenses Interest expenses to group companies Interest expenses to other companies

-133

-35 -43

-93 -32 -17

Other financial expenses to group companies Other financial expenses to other companies

-3

-858 -547 -101

1,632 1,642

Profit (loss) before closing entries and tax

Closing entries Depreciation difference

31 37 -37 31

19

Group contributions received Group contributions granted

0

-24

-5

Income taxes

6

1

-84

Profit (Loss) for the period

1,675

-190

222

223

UPM ANNUAL REPORT 2023

UPM ANNUAL REPORT 2023

UPM FINANCIAL REPORT 2023

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UPM FINANCIAL REPORT 2023

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