SAPPI LIMITED

Capital expenditure by region is as follows:
Capital Expenditure by Region 2010 2009* 2008
(US$ million)
Sappi Fine Paper North America ..................... 42 28 130
Sappi Fine Paper Europe .......................... 95 83 91
Sappi Southern Africa ............................ 72 67 283
Other ........................................ 2 (2) 1
Total ......................................... 211 176 505
* Total capital expenditure in fiscal 2009 includes US$ 1 million related to plantations.
Capital expenditure excludes capitalized interest.
Our capital expenditure program varies from year to year, and expenditure in one year is not
necessarily indicative of future capital expenditure.
During fiscal 2010, our capital expenditure, including US$ 9 million of plantation land purchases,
was US$ 211 million, compared to US$ 176 million during fiscal 2009, which included US$ 1 million of
plantation land purchases. As part of our cash management efforts we managed capital expenditure to a
strategic target without compromising the maintenance of our asset base.
During fiscal 2009, as part of our efforts to address the impact of challenging market conditions and
since we were not committed to any significant capital expenditures for expansion, we reduced capital
expenditures significantly.
We operate in an industry that requires high capital expenditures and, as a result, we need to devote
a significant part of our cash flow to capital expenditure programs, including investments relating to
maintaining operations. Capital spending for investment relating to maintaining operations during fiscal
2010, fiscal 2009 and fiscal 2008 amounted to approximately US$ 173 million, US$ 147 million and
US$ 250 million, respectively. The capital spending relating to maintaining investments included
US$ 15 million, US$ 7 million and US$ 2 million in fiscal 2010, fiscal 2009 and fiscal 2008, respectively,
spent in connection with reconfiguring the recovery circuit at the Somerset Mill to increase the utilization
of black liquor, a renewable fuel generated as a byproduct of the pulping process. This increase in black
liquor utilization is estimated to be equivalent to the energy contained in approximately 100,000 barrels
of oil per year. We believe that, as a result, we will lower costs, improve energy efficiency and further
reduce our carbon footprint. The capital expenditure program for these periods was funded primarily
through internally generated funds.
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