Exhibit 99.1

For Immediate Release

MERCER INTERNATIONAL INC. REPORTS 2009 SECOND QUARTER RESULTS

     NEW YORK, NY, July 29, 2009 — Mercer International Inc. (Nasdaq: MERC, TSX: MRI.U) today reported results for the second quarter ended June 30, 2009. Total revenues in the quarter and Operating EBITDA decreased to €158.9 million (U.S.$216.5 million) and €3.9 million (U.S.$5.3 million) from €176.7 million (U.S.$276.1 million) and €19.8 million (U.S.$30.9 million), respectively, in the same period last year as pulp markets continue to be affected by recessionary economic conditions. Operating EBITDA is defined on page 4 of this press release and reconciled to net income (loss) attributable to common shareholders on page 7 of the financial tables in this press release.

Summary Financial Highlights

	Q2			Q1			Q2
	2009			2009			2008
	(in millions of Euros, except where otherwise stated)
Pulp revenues	€	147.5		€	129.0		€	170.6
Energy revenues		11.4			10.6			6.1
Operating income (loss)		(9.7	)		(12.4	)		6.2
Operating EBITDA		3.9			1.1			19.8
Unrealized gain (loss) on derivative instruments		7.5			(15.0	)		20.6
Foreign exchange gain (loss) on debt		5.2			(4.4	)		0.2
Net income (loss) attributable to common shareholders		(11.5	)		(39.4	)		0.9
Net income (loss) per share attributable to common shareholders:
Basic	€	(0.32	)	€	(1.08	)	€	0.02
Diluted	€	(0.32	)	€	(1.08	)	€	0.02

Summary Operating Highlights

	Q2		Q1		Q2
	2009		2009		2008
Pulp Production (‘000 ADMTs)		349.1		345.6		356.8
Scheduled Production Downtime (‘000 ADMTs)		0.6		—		15.2
Pulp Sales (‘000 ADMTs)		395.4		336.7		347.3
NBSK pulp list price in Europe (US$/ADMT)		602		585		900
NBSK pulp list price in Europe (€/ADMT)		442		449		576
Average pulp sales realizations (€/ADMT)(1)		367		377		485
Energy Production (‘000 MWh)		376.0		356.3		365.5
Energy Sales (‘000 MWh)		128.5		112.2		114.6
Average Spot Currency Exchange Rates(2):
€ /$		0.7338		0.7675		0.6401
C$ / $		1.1671		1.2453		1.0099
C$ / €		1.5890		1.6217		1.5783

(1)	List price, less discounts and commissions.
(2)	Average Bank of Canada noon spot rates over the reporting period.

Page 2

President’s Comments

     Mr. Jimmy S.H. Lee, President and Chairman, stated: “While global economies remain in recession and pulp prices were generally weak, we saw a stabilizing trend during the latter part of the quarter as record restocking by Chinese buyers and production downtime throughout the industry helped reduce global pulp inventories from peak levels earlier in the year. The Pulp and Paper Products Council recently reported that world pulp producer inventories for bleached softwood kraft pulp have fallen to approximately 26 days. List prices also improved in most markets in the quarter with the NBSK price in Europe rising from a low of $580 per ADMT in April to $630 per ADMT at the end of June. Additionally, producers have announced further price increases of about $70 per ADMT for July and August, bringing the NBSK price in Europe to $700 per ADMT. Offsetting this upward movement however has been the weakening of the U.S. dollar which decreased by about 5.4% and 7.8% versus the Euro and Canadian dollar, respectively, during the quarter.”

     Mr. Lee continued: “In June the Canadian government announced a C$1 billion aid program aimed at supporting energy efficiency and environmental performance capital programs at Canadian pulp and paper mills. The amount of funding is to be based upon the quantity of black liquor produced by a mill in 2009. Although no specific rules for the program have been released, we currently believe that our Celgar mill will be eligible for significant capital expenditure grants and thus are reviewing the mill’s various energy and environmental initiatives, including the “green” energy project, with a view to realizing on the opportunities under the program.”

     Mr. Lee added: “Earlier this month we commenced an exchange offer for our outstanding 8.5% convertible notes to improve our capital structure by reducing our debt and interest expense levels. In the quarter we also negotiated the refinancing of the revolving working capital facility of our Rosenthal mill which matures in February 2010, with a new €25.0 million replacement revolving facility set to mature in December 2012 and a four-year amortizing €4.4 million term loan. Subject to customary conditions, we currently expect to finalize both the new loan facility and the term loan sometime in the third quarter.”

     Mr. Lee concluded: “We currently believe that maintenance of inventories at the present lower levels will be key to further price recovery in the second half of the year and into 2010 and that additional production downtime by producers will be required as demand from China levels off.”

Three Months Ended June 30, 2009 Compared to Three Months Ended June 30, 2008

     Pulp revenues for the three months ended June 30, 2009 decreased by approximately 13.5% to €147.5 million from €170.6 million in the comparative period of 2008, primarily due to lower prices resulting from continued weak pulp markets. Revenues from the sale of excess energy increased by approximately 86.9% in the second quarter to €11.4 million from €6.1 million in the same quarter last year as our German mills continue to benefit from the higher biomass energy tariffs implemented at the beginning of the year.

Page 3

     Pulp production decreased to 349,129 ADMTs in the current quarter from 356,819 ADMTs in the same quarter of 2008, primarily due to unscheduled production downtime at our Celgar mill. We took three days of scheduled maintenance downtime in the second quarter of 2009 compared to 11 days in the same period of 2008.

     Pulp sales volume increased to 395,378 ADMTs in the current quarter from 347,259 ADMTs in the comparative period of 2008 primarily as a result of strong sales to China. Average pulp sales realizations decreased by approximately 24.3% to €367 per ADMT in the second quarter of 2009, compared to €485 per ADMT in the same period last year.

     Costs and expenses in the second quarter of 2009 decreased marginally to €168.6 million from €170.4 million in the comparative period of 2008.

     Overall, our fiber costs decreased by approximately 16.0% in the second quarter of 2009 from the same period in 2008. Fiber costs at our German mills continue to be lower as a result of the continuing weak demand from the European board industry. At our Celgar mill fiber costs are benefiting from efficiency improvements made to the mill’s woodroom and other fiber initiatives. As we move into the second half of the year, we currently expect that fiber prices will level off with some upward pressure in pricing for our German mills due to the effect of extensive harvesting curtailments on fiber supply.

     During the second quarter of 2009, our pulp inventories decreased by approximately 36.2% to €26.1 million from €40.9 million at the end of the prior quarter, primarily as a result of higher sales volume. Our raw material inventories decreased to €21.0 million in the current quarter from €26.5 million at the end of the first quarter of 2009.

     For the second quarter of 2009, we recorded an operating loss of €9.7 million compared to operating income of €6.2 million in the comparative quarter of 2008, primarily due to lower price realizations which were partially offset by a stronger U.S. dollar in the period versus the Euro and the Canadian dollar.

     Interest expense in the second quarter of 2009 increased slightly to €16.3 million from €16.0 million in the comparative quarter of 2008.

Page 4

     Our Stendal mill recorded an unrealized gain of €7.5 million on its interest rate derivatives at the end of the current quarter, compared to an unrealized gain of €20.6 million in the same quarter of last year, due to an increase in European long-term interest rates. In the three months ended June 30, 2009, we recorded a foreign exchange gain on our debt of €5.2 million compared to a gain of €0.2 million in the same three months of 2008.

     In the second quarter of 2009, the noncontrolling shareholder’s interest in the Stendal mill’s loss was negligible, compared to €3.4 million in the same quarter last year.

     In the second quarter of 2009, we reported Operating EBITDA of €3.9 million compared to Operating EBITDA of €1.1 million in the prior quarter and Operating EBITDA of €19.8 million in the second quarter of 2008. Operating EBITDA is defined as operating income (loss) plus depreciation and amortization and non-recurring capital asset impairment charges. Management uses Operating EBITDA as a benchmark measurement of its own operating results, and as a benchmark relative to its competitors. Management considers it to be a meaningful supplement to operating income as a performance measure primarily because depreciation expense and non-recurring capital asset impairment charges are not an actual cash cost, and depreciation expense varies widely from company to company in a manner that management considers largely independent of the underlying cost efficiency of their operating facilities. In addition, we believe Operating EBITDA is commonly used by securities analysts, investors and other interested parties to evaluate our financial performance.

     Operating EBITDA does not reflect the impact of a number of items that affect our net income, including financing costs and the effect of derivative instruments. Operating EBITDA is not a measure of financial performance under GAAP, and should not be considered as an alternative to net income attributable to common shareholders or income from operations as a measure of performance, nor as an alternative to net cash from operating activities as a measure of liquidity. Operating EBITDA has significant limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. For a reconciliation of Operating EBITDA to net income (loss) attributable to common shareholders, see page 7 of the financial tables included in this press release.

     We reported a net loss attributable to common shareholders in the current quarter of €11.5 million, or a loss of €0.32 per basic and diluted share. For the second quarter of 2008, net income attributable to common shareholders was €0.9 million, or €0.02 per basic and diluted share. As at June 30, 2009 and 2008, we had 36,422,487 common shares outstanding.

Page 5

Six Months Ended June 30, 2009 Compared to Six Months Ended June 30, 2008

     Pulp revenues for the six months ended June 30, 2009 decreased to €276.6 million from €349.7 million in the comparative period of 2008, primarily due to lower prices resulting from challenging pulp market conditions. Revenues from the sale of excess energy increased to €21.9 million from €13.8 million in the same period last year.

     Operating EBITDA was €4.9 million in the first half of 2009 compared to €52.6 million in the six months ended June 30, 2008. Operating EBITDA has significant limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. See the discussion of our results for the second quarter of 2009 for additional information relating to Operating EBITDA and page 7 of the financial tables for a reconciliation to net income (loss) attributable to common shareholders.

     We reported a net loss attributable to common shareholders for the first half of 2009 of €50.8 million, or €1.40 per basic and diluted share. In the first half of 2008, we reported net income attributable to common shareholders of €3.7 million, or €0.10 per basic and diluted share.

Liquidity and Capital Resources

     The following table is a summary of selected financial information for the periods indicated:

	As at		As at
	June 30,		December 31,
	2009		2008
	(in thousands)
Financial Position
Cash and cash equivalents	€	62,100	€	42,452
Cash, restricted		3,531		13,000
Working capital		80,229		154,374
Property, plant and equipment		875,876		881,704
Total assets		1,105,009		1,151,600
Long-term liabilities		888,184		914,970
Total equity		81,540		132,103

     As at June 30, 2009, our cash and cash equivalents were €62.1 million and working capital was €80.2 million.

Page 6

Restricted Group

     The following table is a summary of selected financial information for the Restricted Group for the periods indicated:

	As at		As at
	June 30,		December 31,
	2009		2008
	(in thousands)
Restricted Group Financial Position
Cash and cash equivalents	€	33,842	€	26,176
Working capital		46,675		101,490
Property, plant and equipment		357,462		351,009
Total assets		555,604		564,374
Long-term liabilities		288,697		309,235
Total equity		192,417		210,179

     As at June 30, 2009, our Restricted Group had cash and cash equivalents of €33.8 million and working capital of €46.7 million.

Earnings Release Call

     In conjunction with this release, Mercer International Inc. will host a conference call, which will be simultaneously broadcast live over the Internet. Management will host the call, which is scheduled for Thursday, July 30, 2009 at 10:00 AM (Eastern Daylight Time). Listeners can access the conference call live and archived through August 30, 2009, over the Internet at http://investor.shareholder.com/media/eventdetail.cfm?mediaid=38093&c=MERC&mediakey=50D857354A43CD0F D3CD8A36343ED6B2&e=0 or through a link on the Company’s News/Financial page at http://www.mercerint.com/s/NewsReleases.asp. Please allow 15 minutes prior to the call to visit the site and download and install any necessary audio software. A replay of this call will be available approximately two hours after the live call ends until August 6, 2009 at 11:59 PM (Eastern Daylight Time). The replay number is (800) 642-1687 for domestic callers or (706) 645-9291 for international callers, and the passcode is 2142580.

     Mercer International Inc. is a global pulp manufacturing company. To obtain further information on the company, please visit its web site at http://www.mercerint.com.

Page 7

     The preceding includes forward looking statements which involve known and unknown risks and uncertainties which may cause our actual results in future periods to differ materially from forecasted results. Among those factors which could cause actual results to differ materially are the following: the effects of the current economic and financial turmoil, the highly cyclical nature of our business, raw material costs, our level of indebtedness, competition, foreign exchange and interest rate fluctuations, our use of derivatives, expenditures for capital projects, environmental regulation and compliance, disruptions to our production, market conditions and other risk factors listed from time to time in our SEC reports.

APPROVED BY: Jimmy S.H. Lee Chairman & President (604) 684-1099	FD Investors: Eric Boyriven, Alexandra Tramont Media: Jordana Miller (212) 850-5600
David M. Gandossi
Executive Vice-President &
Chief Financial Officer
(604) 684-1099

-FINANCIAL TABLES FOLLOW-

MERCER INTERNATIONAL INC.

INTERIM CONSOLIDATED BALANCE SHEETS

(Unaudited)
(In thousands of Euros)

	June 30,			December 31,
	2009			2008
ASSETS
Current assets
Cash and cash equivalents	€	62,100		€	42,452
Cash, restricted		3,531			13,000
Receivables		76,865			100,158
Inventories		69,486			98,457
Prepaid expenses and other		3,532			4,834
Total current assets		215,514			258,901
Long-term assets
Property, plant and equipment		875,876			881,704
Investments		92			419
Deferred note issuance and other costs		8,219			4,011
Deferred income tax		2,133			3,036
Note receivable, less current portion		3,175			3,529
		889,495			892,699
Total assets	€	1,105,009		€	1,151,600
LIABILITIES
Current liabilities
Accounts payable and accrued expenses	€	94,731		€	87,517
Pension and other post-retirement benefit obligations, current portion		555			510
Debt, current portion		39,999			16,500
Total current liabilities		135,285			104,527
Long-term liabilities
Debt, less current portion		810,426			837,918
Unrealized interest rate derivative losses		54,675			47,112
Pension and other post-retirement benefit obligations		13,385			12,846
Capital leases and other		9,698			11,267
Deferred income tax		—			5,827
		888,184			914,970
Total liabilities		1,023,469			1,019,497
EQUITY
Shareholders’ equity
Share capital		202,844			202,844
Paid-in capital		(5,871	)		299
Retained earnings (deficit)		(85,872	)		(35,046	)
Accumulated other comprehensive income (loss)		7,658			(1,872	)
Total shareholders’ equity		118,759			166,225
Noncontrolling interest (deficit)		(37,219	)		(34,122	)
Total equity		81,540			132,103
Total liabilities and equity	€	1,105,009		€	1,151,600

(1)

MERCER INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)
(In thousands of Euros, except per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2009			2008			2009			2008
Revenues
Pulp	€	147,522		€	170,585		€	276,555		€	349,686
Energy		11,362			6,066			21,901			13,781
		158,884			176,651			298,456			363,467
Costs and expenses
Operating costs		149,033			148,968			281,030			296,124
Operating depreciation and amortization		13,539			13,514			26,940			27,635
		(3,688	)		14,169			(9,514	)		39,708
Selling, general and administrative expenses		6,032			7,953			13,177			14,849
Purchase (sale) of emission allowances		16			—			(542	)		—
Operating income (loss)		(9,736	)		6,216			(22,149	)		24,859
Other income (expense)
Interest expense		(16,319	)		(16,013	)		(32,868	)		(32,633	)
Investment income (loss)		138			1,421			(3,064	)		1,731
Foreign exchange gain (loss) on debt		5,170			238			754			6,269
Unrealized gain (loss) on derivative instruments		7,451			20,580			(7,562	)		12,730
Total other income (expense)		(3,560	)		6,226			(42,740	)		(11,903	)
Income (loss) before income taxes		(13,296	)		12,442			(64,889	)		12,956
Income tax benefit (provision) – current		(65	)		(213	)		(114	)		163
– deferred		1,888			(7,922	)		4,919			(9,126	)
Net income (loss)		(11,473	)		4,307			(60,084	)		3,993
Less: net loss (income) attributable to noncontrolling interest		(3	)		(3,436	)		9,258			(253	)
Net income (loss) attributable to common shareholders		(11,476	)		871			(50,826	)		3,740
Retained earnings (deficit), beginning of period		(74,396	)		40,288			(35,046	)		37,419
Retained earnings (deficit), end of period	€	(85,872	)	€	41,159		€	(85,872	)	€	41,159
Net income (loss) per share attributable to common shareholders:
Basic and diluted	€	(0.32	)	€	0.02		€	(1.40	)	€	0.10

(2)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Balance Sheet
(Unaudited)

(In thousands of Euros)

The terms of the indenture governing our 9.25% senior unsecured notes require that we provide the results of operations and financial condition of Mercer International Inc. and our restricted subsidiaries under the indenture, collectively referred to as the “Restricted Group”. As at and during the three and six months ended June 30, 2009 and 2008, the Restricted Group was comprised of Mercer International Inc., our Rosenthal and Celgar mills and certain holding subsidiaries. The Restricted Group excludes the Stendal mill.

	June 30, 2009
	Restricted		Unrestricted						Consolidated
	Group		Subsidiaries			Eliminations			Group
ASSETS
Current assets
Cash and cash equivalents	€	33,842	€	28,258		€	—		€	62,100
Cash, restricted		—		3,531			—			3,531
Receivables		36,888		39,977			—			76,865
Inventories		48,394		21,092			—			69,486
Prepaid expenses and other		2,041		1,491			—			3,532
Total current assets		121,165		94,349			—			215,514
Property, plant and equipment		357,462		518,414			—			875,876
Other		3,204		5,107			—			8,311
Deferred income tax		2,133		—			—			2,133
Due from unrestricted group		68,465		—			(68,465	)		—
Note receivable, less current portion		3,175		—			—			3,175
Total assets	€	555,604	€	617,870		€	(68,465	)	€	1,105,009
LIABILITIES
Current liabilities
Accounts payable and accrued expenses	€	50,436	€	44,295		€	—		€	94,731
Pension and other post-retirement benefit obligations, current portion		555		—			—			555
Debt, current portion		23,499		16,500			—			39,999
Total current liabilities		74,490		60,795			—			135,285
Debt, less current portion		269,102		541,324			—			810,426
Due to restricted group		—		68,465			(68,465	)		—
Unrealized interest rate derivative losses		—		54,675			—			54,675
Pension and other post-retirement benefit obligations		13,385		—			—			13,385
Capital leases and other		6,210		3,488			—			9,698
Total liabilities		363,187		728,747			(68,465	)		1,023,469
EQUITY
Total shareholders’ equity (deficit)		192,417		(73,658	)		—			118,759
Noncontrolling interest (deficit)		—		(37,219	)		—			(37,219	)
Total liabilities and equity	€	555,604	€	617,870		€	(68,465	)	€	1,105,009

(3)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Balance Sheet
(Unaudited)

(In thousands of Euros)

	December 31, 2008
	Restricted		Unrestricted						Consolidated
	Group		Subsidiaries			Eliminations			Group
ASSETS
Current assets
Cash and cash equivalents	€	26,176	€	16,276		€	—		€	42,452
Cash, restricted		—		13,000			—			13,000
Receivables		57,258		42,900			—			100,158
Inventories		59,801		38,656			—			98,457
Prepaid expenses and other		3,215		1,619			—			4,834
Total current assets		146,450		112,451			—			258,901
Property, plant and equipment		351,009		530,695			—			881,704
Other		4,425		5			—			4,430
Deferred income tax		3,036		—			—			3,036
Due from unrestricted group		55,925		—			(55,925	)		—
Note receivable, less current portion		3,529		—			—			3,529
Total assets	€	564,374	€	643,151		€	(55,925	)	€	1,151,600
LIABILITIES
Current liabilities
Accounts payable and accrued expenses	€	44,450	€	43,067		€	—		€	87,517
Pension and other post-retirement benefit obligations, current portion		510		—			—			510
Debt, current portion		—		16,500			—			16,500
Total current liabilities		44,960		59,567			—			104,527
Debt, less current portion		289,222		548,696			—			837,918
Due to restricted group		—		55,925			(55,925	)		—
Unrealized interest rate derivative losses		—		47,112			—			47,112
Pension and other post-retirement benefit obligations		12,846		—			—			12,846
Capital leases and other		7,167		4,100			—			11,267
Deferred income tax		—		5,827			—			5,827
Total liabilities		354,195		721,227			(55,925	)		1,019,497
EQUITY
Total shareholders’ equity (deficit)		210,179		(43,954	)		—			166,225
Noncontrolling interest (deficit)		—		(34,122	)		—			(34,122	)
Total liabilities and equity	€	564,374	€	643,151		€	(55,925	)	€	1,151,600

(4)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Statements of Operations
(Unaudited)

(In thousands of Euros)

	Three Months Ended June 30, 2009
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues	€	80,388		€	78,496		€	—		€	158,884
Operating costs		78,813			70,220			—			149,033
Operating depreciation and amortization		6,888			6,651			—			13,539
Selling, general and administrative expenses and other		4,294			1,754			—			6,048
		89,995			78,625			—			168,620
Operating income (loss)		(9,607	)		(129	)		—			(9,736	)
Other income (expense)
Interest expense		(6,927	)		(10,513	)		1,121			(16,319	)
Investment income (loss)		1,234			25			(1,121	)		138
Foreign exchange gain (loss) on debt		5,170			—			—			5,170
Derivative instruments		—			7,451			—			7,451
Total other income (expense)		(523	)		(3,037	)		—			(3,560	)
Income (loss) before income taxes		(10,130	)		(3,166	)		—			(13,296	)
Income tax benefit (provision)		(1,149	)		2,972			—			1,823
Net income (loss)		(11,279	)		(194	)		—			(11,473	)
Less: net (income) loss attributable to noncontrolling interest		—			(3	)		—			(3	)
Net income (loss) attributable to common shareholders	€	(11,279	)	€	(197	)	€	—		€	(11,476	)

	Three Months Ended June 30, 2008
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues	€	99,888		€	76,763		€	—		€	176,651
Operating costs		90,132			58,836			—			148,968
Operating depreciation and amortization		6,774			6,740			—			13,514
Selling, general and administrative expenses and other		4,865			3,088			—			7,953
		101,771			68,664			—			170,435
Operating income (loss)		(1,883	)		8,099			—			6,216
Other income (expense)
Interest expense		(6,370	)		(10,614	)		971			(16,013	)
Investment income (loss)		1,557			835			(971	)		1,421
Foreign exchange gain (loss) on debt		(248	)		486			—			238
Derivative instruments		—			20,580			—			20,580
Total other income (expense)		(5,061	)		11,287			—			6,226
Income (loss) before income taxes		(6,944	)		19,386			—			12,442
Income tax benefit (provision)		(1,303	)		(6,832	)		—			(8,135	)
Net income (loss)		(8,247	)		12,554			—			4,307
Less: net (income) loss attributable to noncontrolling interest		—			(3,436	)		—			(3,436	)
Net income (loss) attributable to common shareholders	€	(8,247	)	€	9,118		€	—		€	871

(5)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Statements of Operations
(Unaudited)
(In thousands of Euros)

	Six Months Ended June 30, 2009
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues	€	159,420		€	139,036		€	—		€	298,456
Operating costs		152,129			128,901			—			281,030
Operating depreciation and amortization		13,592			13,348			—			26,940
Selling, general and administrative expenses and other		8,716			3,919			—			12,635
		174,437			146,168			—			320,605
Operating income (loss)		(15,017	)		(7,132	)		—			(22,149	)
Other income (expense)
Interest expense		(14,229	)		(20,869	)		2,230			(32,868	)
Investment income (loss)		2,150			(2,984	)		(2,230	)		(3,064	)
Foreign exchange gain (loss) on debt		754			—			—			754
Derivative instruments		—			(7,562	)		—			(7,562	)
Total other income (expense)		(11,325	)		(31,415	)		—			(42,740	)
Income (loss) before income taxes		(26,342	)		(38,547	)		—			(64,889	)
Income tax benefit (provision)		(941	)		5,746			—			4,805
Net income (loss)		(27,283	)		(32,801	)		—			(60,084	)
Less: net (income) loss attributable to noncontrolling interest		—			9,258			—			9,258
Net income (loss) attributable to common shareholders	€	(27,283	)	€	(23,543	)	€	—		€	(50,826	)

	Six Months Ended June 30, 2008
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues	€	204,476		€	158,991		€	—		€	363,467
Operating costs		171,274			124,850			—			296,124
Operating depreciation and amortization		14,195			13,440			—			27,635
Selling, general and administrative expenses and other		8,609			6,240			—			14,849
		194,078			144,530			—			338,608
Operating income (loss)		10,398			14,461			—			24,859
Other income (expense)
Interest expense		(13,082	)		(21,481	)		1,930			(32,633	)
Investment income (loss)		3,293			368			(1,930	)		1,731
Foreign exchange gain (loss) on debt		6,379			(110	)		—			6,269
Derivative instruments		—			12,730			—			12,730
Total other income (expense)		(3,410	)		(8,493	)		—			(11,903	)
Income (loss) before income taxes		6,988			5,968			—			12,956
Income tax benefit (provision)		(3,457	)		(5,506	)		—			(8,963	)
Net income (loss)		3,531			462			—			3,993
Less: net (income) loss attributable to noncontrolling interest		—			(253	)		—			(253	)
Net income (loss) attributable to common shareholders	€	3,531		€	209		€	—		€	3,740

(6)

MERCER INTERNATIONAL INC.

COMPUTATION OF OPERATING EBITDA
(Unaudited)
(In thousands of Euros)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2009			2008			2009			2008
	(in thousands)						(in thousands)
Net income (loss) attributable to common shareholders	€	(11,476	)	€	871		€	(50,826	)	€	3,740
Net income (loss) attributable to noncontrolling interest		3			3,436			(9,258	)		253
Income taxes (benefits)		(1,823	)		8,135			(4,805	)		8,963
Interest expense		16,319			16,013			32,868			32,633
Investment (income) loss		(138	)		(1,421	)		3,064			(1,731	)
Unrealized foreign exchange (gain) loss on debt		(5,170	)		(238	)		(754	)		(6,269	)
Derivative financial instruments		(7,451	)		(20,580	)		7,562			(12,730	)
Operating income (loss)		(9,736	)		6,216			(22,149	)		24,859
Add: Depreciation and amortization		13,604			13,584			27,071			27,776
Operating EBITDA(1)	€	3,868		€	19,800		€	4,922		€	52,635

(1) Operating EBITDA does not reflect the impact of a number of items that affect our net income (loss) attributable to common shareholders, including financing costs and the effect of derivative instruments. Operating EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States, and should not be considered as an alternative to net income (loss) attributable to common shareholders or income (loss) from operations as a measure of performance, nor as an alternative to net cash from operating activities as a measure of liquidity. Operating EBITDA has significant limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP.

COMPUTATION OF RESTRICTED GROUP OPERATING EBITDA
(Unaudited)
(In thousands of Euros)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2009			2008			2009			2008
	(in thousands)						(in thousands)
Restricted Group
Net income (loss) attributable to common shareholders	€	(11,279	)	€	(8,247	)	€	(27,283	)	€	3,531
Income taxes (benefits)		1,149			1,303			941			3,457
Interest expense		6,927			6,370			14,229			13,082
Investment (income) loss		(1,234	)		(1,557	)		(2,150	)		(3,293	)
Unrealized foreign exchange (gain) loss on debt		(5,170	)		248			(754	)		(6,379	)
Operating income (loss)		(9,607	)		(1,883	)		(15,017	)		10,398
Add: Depreciation and amortization		6,953			6,844			13,723			14,336
Operating EBITDA(1)	€	(2,654	)	€	4,961		€	(1,294	)	€	24,734

(1) Operating EBITDA does not reflect the impact of a number of items that affect our net income (loss) attributable to common shareholders, including financing costs and the effect of derivative instruments. Operating EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States, and should not be considered as an alternative to net income (loss) attributable to common shareholders or income (loss) from operations as a measure of performance, nor as an alternative to net cash from operating activities as a measure of liquidity. Operating EBITDA has significant limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP.

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