SAPPI LIMITED

Movements in operating profit and operating profit excluding special items are explained below.
Segment contributions to operating profit were as follows:
Operating Profit / (Loss) 2010 2010 vs. 2009 2009 2009 vs. 2008 2008
Sappi Fine Paper North America .............. 180 127
(US$ million)
53 (39) 92
Sappi Fine Paper Europe ................... 72 139 (67) (3) (64)
Sappi Southern Africa ...................... 112 167 (55) (334) 279
Unallocated and eliminations (1) ............... (23) (19) (4) (11) 7
Total .................................. 341 414 (73) (387) 314
(1) Includes the Group’s treasury operations, the self-insurance captive and the investment in the Jiangxi Chenming joint
venture.
Special items (Gain) / Loss 2010 2009 2008
Sappi Fine Paper North America ...................... (56) (55) 3
Sappi Fine Paper Europe ........................... 4 79 119
Sappi Southern Africa .............................. 22 72 (70)
Unallocated and eliminations (1) ....................... 28 10 —
Total .......................................... (2) 106 52
(1) Includes the Group’s treasury operations, the self-insurance captive and the investment in the Jiangxi Chenming joint
venture.
Operating Profit / (Loss) excluding special items 2010 2010 vs. 2009 2009 2009 vs. 2008 2008
Sappi Fine Paper North America .............. 124 126
(US$ million)
(2) (97) 95
Sappi Fine Paper Europe ................... 76 64 12 (43) 55
Sappi Southern Africa ...................... 134 117 17 (192) 209
Unallocated and eliminations (1) ............... 5 (1) 6 (1) 7
Total .................................. 339 306 33 (333) 366
(1) Includes the Group’s treasury operations, the self-insurance captive and the investment in the Jiangxi Chenming joint
venture.
Special items for the Group in fiscal 2010 and fiscal 2009 are generally summarized below:
Plantation price fair value: This relates to an accounting fair value adjustment of the timber
assets of Sappi Forests and Usutu Forests. This fair value adjustment is mainly impacted by timber
selling prices, cost associated with standing timber values and harvesting and delivery, and discount
rates applied. The parameters applied are all market related. The impact was a positive US$ 31 million in
fiscal 2010 and a negative impact of US$ 67 million in fiscal 2009. For further information see ‘‘—Critical
Accounting Policies and Estimates’’.
Impairment and restructuring charges: In fiscal 2010 operating profit was positively impacted
by asset impairment reversals of US$ 10 million, which comprised the reversal of a portion of the fiscal
2009 impairment of the coated mechanical paper business unit in Europe, which negatively impacted
operating profit in that year (US$ 74 million). Fiscal 2009 operating profit was further negatively impacted
by the impairment of the Usutu mill in southern Africa (US$ 5 million).
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