Exhibit 99.1

For Immediate Release

MERCER INTERNATIONAL INC. REPORTS 2013 FOURTH QUARTER AND YEAR END RESULTS

NEW YORK, NY, February 13, 2014 - Mercer International Inc. (Nasdaq: MERC, TSX: MRI.U) today reported results for the fourth quarter and year ended December 31, 2013. Operating EBITDA* in the fourth quarter of 2013 was $27.2 million after giving effect to $2.6 million in restructuring expenses, compared to $27.7 million in the same quarter of last year and $32.8 million in the third quarter of 2013. For 2013, Operating EBITDA was $110.3 million and included $6.4 million in restructuring expenses, compared to $137.7 million in 2012.

For the fourth quarter of 2013, our net loss was $9.8 million, or $0.18 per share, compared to a net loss of $6.7 million, or $0.12 per share, in the fourth quarter of 2012 and a net loss of $3.0 million, or $0.05 per share, for the third quarter of 2013. For 2013, we reported a net loss of $26.4 million, or $0.47 per share, compared to a net loss of $15.7 million, or $0.28 per share, in 2012.

On October 1, 2013, we changed our reporting currency from the Euro to the U.S. dollar. See page 7 of this press release for further information about this change.

Summary Financial Highlights

	Q4 2013			Q3 2013			Q4 2012			Year 2013			Year 2012
	(in millions, except per share amounts)
Pulp revenues	$	258.5		$	246.7		$	222.5		$	996.2		$	979.8
Energy and chemical revenues		24.1			22.6			22.3			92.2			93.0
Operating income		6.9			13.3			9.5			31.7			63.0
Restructuring expenses		2.6			3.8			—			6.4			—
Operating EBITDA		27.2			32.8			27.7			110.3			137.7
Gain on derivative instruments		3.8			2.6			3.1			19.7			4.8
Income tax benefit (provision)		(6.0	)		(1.2	)		(3.1	)		(9.2	)		(9.4	)
Net income (loss)(1)		(9.8	)		(3.0	)		(6.7	)		(26.4	)		(15.7	)
Net income (loss) per share(1)(2)	$	(0.18	)	$	(0.05	)	$	(0.12	)	$	(0.47	)	$	(0.28	)
Common shares outstanding at period end		55.9			55.9			55.8			55.9			55.8

(1) Attributable to common shareholders.

(2) Per basic and diluted share.

Summary Operating Highlights

	Q4 2013		Q3 2013		Q4 2012		Year 2013		Year 2012
Pulp production (‘000 ADMTs)		364.8		369.0		349.5		1,444.5		1,468.3
Scheduled production downtime (‘000 ADMTs)		22.4		9.4		18.1		47.8		50.9
Pulp sales (‘000 ADMTs)		358.6		356.6		335.2		1,440.1		1,473.5
Average NBSK pulp list price in Europe ($/ADMT)(1)		902		867		803		864		813
Average pulp sales realizations ($/ADMT)(2)		713		682		655		683		657

(1) Source: RISI pricing report.

(2) Sales realizations after discounts. Incorporates the effect of pulp price variations occurring between the order and shipment dates.

* Operating EBITDA is not a measure of financial performance under accounting principles generally accepted in the United States (“GAAP”) and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. See page 10 of the financial tables included in this press release for a reconciliation of net income (loss) attributable to common shareholders to Operating EBITDA.

	Q4 2013		Q3 2013		Q4 2012		Year 2013		Year 2012
Energy production (‘000 MWh)		435.8		444.2		405.9		1,710.2		1,704.1
Energy sales (‘000 MWh)		172.5		185.4		163.8		699.1		710.2
Average Spot Currency Exchange Rates:
$ / €(3)		1.3619		1.3252		1.2977		1.3281		1.2859
$ / C$(3)		0.9530		0.9630		1.0089		0.9712		1.0007

(3) Average Federal Reserve Bank of New York noon spot rate over the reporting period.

President’s Comments

Mr. Jimmy S.H. Lee, President and Chairman, stated: “In the fourth quarter of 2013, our Operating EBITDA was in line with the comparative period of 2012 and down about 17% from the third quarter of 2013. In the current quarter, we had $2.6 million in restructuring expenses, primarily related to a management restructuring at our Stendal mill and the workforce reduction at our Celgar mill. For the year 2013, Operating EBITDA declined by approximately 20% from 2012 as higher fiber prices in Germany, the weakness of the U.S. dollar versus the Euro and $6.4 million of restructuring expenses more than offset higher average list prices in 2013. The U.S. dollar was 5% and 3% weaker versus the Euro in the current quarter and 2013, compared to the comparable periods of 2012, respectively.”

Mr. Lee continued: “Our Stendal mill completed Project Blue Mill in December 2013, slightly below budget, and the mill is currently producing at planned levels. The project is designed to increase the mill’s annual production capacity by approximately 30,000 ADMTs of pulp and 109,000 MWh of surplus renewable energy.”

Mr. Lee added: “Our Rosenthal and Stendal mills both achieved new monthly production records in the fourth quarter of 2013. Energy production increased 7% and sales increased by about 5% in the fourth quarter of 2013 compared to the same period of 2012 as a result of the start and ramp up of the additional turbine at our Stendal mill. In the fourth quarter, our Stendal mill had 12 days of scheduled downtime for its annual maintenance.”

Mr. Lee continued: “At the end of 2013, list pulp prices in Europe were approximately $905 per ADMT, while list prices in North America and China were approximately $990 and $750 per ADMT, respectively. A $20 per ADMT price increase for North America was implemented in January 2014. In Europe, a $15 per ADMT price increase was implemented in January 2014 with a further $10 per ADMT price increase implemented in February 2014. In China, a $10 per ADMT price increase was implemented in February 2014.”

Mr. Lee continued: “At year end, the NBSK pulp market was slightly under-balanced with world producer inventories at about 27 days’ supply. In addition, we expect to see continued growth in NBSK demand in emerging markets, particularly in China, driven by increasing strong demand from tissue producers. As a result of the foregoing and the closure of a Norwegian mill, we currently expect that NBSK pulp prices will continue their moderate upward trend over the first half of 2014. During the course of 2014, the global supply of hardwood kraft pulp is projected to increase by approximately 2.1 million ADMTs, primarily from South America. This increase in hardwood production is largely targeted at the growing demand for pulp by tissue makers, particularly in China. If such additional hardwood pulp supply is not absorbed by such demand growth, as a result of generally lower prices for hardwood pulp, this supply increase could put downward pressure on NBSK pulp prices. However, we believe customers’ ability to further substitute NBSK pulp for lower priced hardwood pulp is limited by the strength characteristic provided by NBSK pulp that large modern paper machines need to run lower basis weight paper products efficiently.”

Page 2

Mr. Lee continued: “Fiber costs in Germany remained at relatively high levels through the fourth quarter of 2013 as a result of continued strong demand for roundwood from sawmills offsetting slightly lower chip prices. Fiber costs at our Celgar mill slightly decreased as a result of strong sawmill activity in the region. Overall, fiber costs per unit were approximately 11% and 2% higher in the fourth quarter of 2013, compared to the last quarter of 2012 and the third quarter of 2013, respectively. We expect fiber costs in Germany and Canada to remain relatively stable in the first quarter of 2014.”

Mr. Lee added: “In 2014, we have no scheduled downtime in the first quarter. For the balance of 2014, we have scheduled maintenance downtime of ten days, or approximately 14,000 ADMTs, for our Celgar mill in the second quarter and 12 days, or approximately 12,000 ADMTs, for our Rosenthal mill in the third quarter. Our Stendal mill is not scheduled to have major maintenance downtime in 2014. Instead, in the second and fourth quarters of 2014, our Stendal mill will have two two-day shutdowns, or approximately 3,600 ADMTs for each shutdown.”

Mr. Lee concluded: “Currently all of our mills are performing well. In 2014, our Stendal mill should see the benefits of higher production of pulp and electricity from Project Blue Mill. Further, our Celgar mill should benefit from the recent decline of the Canadian dollar versus the U.S. dollar and realize lower fixed costs as a result of its workforce reduction and other initiatives. In 2014, our Rosenthal mill is completing a capital project so that it can produce and sell tall oil, a chemical by-product. These factors, coupled with currently improving pulp prices, should help position us to build value for our stakeholders in 2014.”

Three Months Ended December 31, 2013 Compared to Three Months Ended December 31, 2012

Total revenues for the three months ended December 31, 2013 increased by approximately 15% to $282.7 million from $244.8 million in the same period in 2012, due to higher pulp and energy and chemical revenues. Pulp revenues for the three months ended December 31, 2013 increased to $258.5 million from $222.5 million in the comparative quarter of 2012, primarily due to increased sales volume at our Celgar and Stendal mills and higher average pulp sales realizations.

Energy and chemical revenues increased by approximately 8% to $24.1 million in the fourth quarter of 2013 from $22.3 million in the same quarter last year, primarily as a result of higher sales volumes.

Page 3

Pulp production increased by approximately 4% to 364,798 ADMTs in the current quarter from 349,517 ADMTs in the same quarter of 2012. We took 12 days (approximately 22,400 ADMTs) of scheduled maintenance downtime at our Stendal mill in the fourth quarter of 2013, compared to ten days (approximately 18,100 ADMTs) of scheduled maintenance downtime at our Stendal mill in the fourth quarter of 2012.

Pulp sales volumes increased by approximately 7% to 358,583 ADMTs in the current quarter from 335,215 ADMTs in the comparative quarter, primarily due to higher sales to China.

Average pulp sales realizations increased by approximately 9% to $713 per ADMT from approximately $655 per ADMT in the same quarter last year, primarily due to higher average NBSK list prices.

Costs and expenses in the fourth quarter of 2013 increased by approximately 17% to $275.8 million from $235.3 million in the comparative period of 2012, primarily due to higher sales volume, higher fiber prices in Germany and the impact of a weaker U.S. dollar relative to the Euro on our German mill expenses. Our costs and expenses in the three months ended December 31, 2013 included $10.4 million for the Stendal maintenance shutdown. Several competing producers and members of the peer group that we benchmark our performance against report their financial results in accordance with International Financial Reporting Standards which permit a significant portion of such maintenance costs to be capitalized instead of expensed.

On average, our overall per unit fiber costs in the current quarter increased by approximately 11% from the same period in 2012 as higher fiber costs in Germany were only partially offset by lower fiber costs in Canada.

Selling, general and administrative expenses were $14.7 million in the fourth quarter of 2013, compared to $12.5 million in the fourth quarter of 2012.

In the fourth quarter of 2013, we had restructuring expenses of $2.6 million, primarily related to a management restructuring at our Stendal mill and the workforce reduction at our Celgar mill.

For the fourth quarter of 2013, our operating income decreased to $6.9 million from $9.5 million in the comparative quarter of 2012, primarily due to higher fiber costs in Germany and the impact of a weaker U.S. dollar relative to the Euro on our German mill expenses, only partially offset by a higher realized sales price and higher sales volumes.

Interest expense in the fourth quarter of 2013 decreased to $17.4 million from $17.8 million in the comparative quarter of 2012.

We recorded a net derivative gain of $3.8 million, which includes an unrealized gain of approximately $4.1 million on the mark to market adjustment of our Stendal mill’s interest rate derivative and an approximately $0.4 million realized loss related to fixed price pulp swap contracts entered into in the fourth quarter of 2012, compared to a net derivative gain of $3.1 million in the same quarter of last year.

Page 4

The noncontrolling shareholder’s interest in the Stendal mill’s net loss in the fourth quarter of 2013 was $1.8 million, compared to $1.5 million in the same quarter last year.

We recognized a deferred tax expense of $5.6 million in the fourth quarter of 2013, compared to $2.8 million in the same quarter of 2012, primarily due to reducing our net deferred tax assets on the balance sheet. This is a non-cash charge and does not reduce our underlying tax attributes or hinder our ability to use them.

In the fourth quarter of 2013, Operating EBITDA decreased marginally to $27.2 million from $27.7 million in the fourth quarter of 2012. Operating EBITDA is defined as operating income (loss) plus depreciation and amortization and non-recurring capital asset impairment charges. Operating EBITDA has significant limitations as an analytical tool and should not be considered in isolation or as a substitute for our results as reported under GAAP. See page 10 of the financial tables included in the press release for a reconciliation of net income (loss) attributable to common shareholders to Operating EBITDA.

We reported a net loss attributable to common shareholders of $9.8 million, or $0.18 per basic and diluted share, for the fourth quarter of 2013, which included a net gain of $3.8 million on the Stendal interest rate derivative and fixed price pulp swaps and $2.6 million in restructuring expenses. In the fourth quarter of 2012, the net loss attributable to common shareholders was $6.7 million, or $0.12 per basic and diluted share, which included a net gain of $3.1 million on the Stendal interest rate derivative and fixed price pulp swaps.

Year Ended December 31, 2013 Compared to Year Ended December 31, 2012

Total revenues for 2013 increased marginally to $1,088.4 million from $1,072.7 million in the same period in 2012. Pulp revenues for 2013 increased by 2% to $996.2 million from $979.8 million in the comparative period of 2012, primarily due to higher average pulp sales realizations, partially offset by lower sales volumes.

Energy and chemical revenues marginally decreased to $92.2 million in 2013 from $93.0 million in the same period last year, primarily as a result of marginally lower sales volumes.

Pulp production decreased by approximately 2% to 1,444,475 ADMTs in 2013 from 1,468,275 ADMTs in the same period of 2012, primarily due to lower pulp production at our Celgar mill. In the second quarter, the Celgar mill took its annual maintenance shutdown. As a result of weather, equipment and execution issues, the shutdown was four days longer and the startup was slower than budgeted, which resulted in a loss of approximately 30,300 ADMTs of NBSK pulp production.

Pulp sales volumes decreased by approximately 2% to 1,440,147 ADMTs in 2013 from 1,473,519 ADMTs in the comparative period of 2012, primarily due to lower production levels at our Celgar mill.

Page 5

Costs and expenses in 2013 increased by approximately 5% to $1,056.7 million from $1,009.7 million in the comparative period of 2012, primarily due to higher fiber costs at our German mills, the impact of a weaker U.S. dollar relative to the Euro on our German mill expenses and restructuring costs, partially offset by lower sales volume. Included in our 2013 costs and expenses are $24.7 million for regularly scheduled major maintenance shutdowns.

On average, our per unit fiber costs in 2013 increased by approximately 8% over the comparative period of 2012, as higher fiber costs in Germany were only partially offset by lower fiber costs in Canada.

In 2013, we had restructuring expenses of $6.4 million, primarily related to the workforce reduction at our Celgar mill.

For 2013, operating income decreased to $31.7 million from $63.0 million in the comparative period of 2012, primarily due to higher fiber costs in Germany, the impact of a weaker U.S. dollar relative to the Euro on our German mill expenses and the Celgar mill shutdown, partially offset by a higher realized sales price.

Interest expense in 2013 decreased to $69.2 million from $71.8 million in the comparative period of 2012, primarily due to reduced debt levels associated with our Stendal mill.

We recorded a net derivative gain of $19.7 million, which includes a $22.5 million unrealized gain on the mark to market adjustment of our Stendal mill’s interest rate derivative and a $2.8 million realized loss on our fixed pulp price swap contracts, compared to a derivative gain of $4.8 million in the same period of last year.

We recognized a deferred tax expense of $11.5 million in 2013, compared to a recovery of $0.2 million in 2012, primarily due to reducing our net deferred tax assets on the balance sheet. This charge is a non-cash charge and does not reduce our underlying tax attributes or hinder our ability to use them.

In 2013, Operating EBITDA decreased to $110.3 million from $137.7 million in 2012.⁽¹⁾

We reported a net loss attributable to common shareholders of $26.4 million, or $0.47 per basic and diluted share, for 2013, which included a net gain of $19.7 million on the Stendal interest rate derivative and fixed price pulp swaps, restructuring expenses of $6.4 million and $11.5 million of a deferred tax expense. In 2012, the net loss attributable to common shareholders was $15.7 million, or $0.28 per basic and diluted share, which included a gain of $4.8 million on the fixed price pulp swaps and Stendal interest rate derivative.

⁽¹⁾ See page 10 of the financial tables included in the press release for limitations on the use of Operating EBITDA as an analytical tool and a reconciliation of net income (loss) to Operating EBITDA.

Page 6

Liquidity and Capital Resources

The following table is a summary of selected financial information as at the dates indicated:

	Year Ended December 31,
	2013		2012
	(in thousands)
Financial Position
Cash and cash equivalents	$	147,728	$	137,439
Working capital		306,274		275,004
Total assets		1,548,559		1,560,581
Long-term liabilities		1,034,743		1,012,943
Total equity		348,317		367,762

As at December 31, 2013, we had approximately €28.3 million and C$33.3 million available under our Rosenthal and Celgar revolving credit facilities, respectively.

On September 30, 2013, we completed an amendment to the Stendal mill’s senior project finance credit facility and its amortizing term facility in respect of Project Blue Mill to provide the mill greater financial flexibility.

Restricted Group

The following table is a summary of selected financial information for the Restricted Group (which, under the indenture for our 2017 9.5% Senior Notes, is comprised of Mercer International Inc., certain holding subsidiaries and our Rosenthal and Celgar mills) as at the dates indicated:

	Year Ended December 31,
	2013		2012
	(in thousands)
Financial Position
Cash and cash equivalents	$	82,910	$	48,407
Working capital		211,749		174,213
Total assets		858,824		849,271
Long-term liabilities		394,821		343,056
Total equity		412,033		442,161

Change in Reporting Currency

Effective October 1, 2013, we changed our reporting currency from the Euro to the U.S. dollar, as management is of the opinion that a U.S. dollar reporting currency enhances communication and understanding with our shareholders, analysts and other stakeholders and improves comparability of our financial information with our competitors and peer group companies. Consolidated financial statements issued prior to October 1, 2013 were prepared using the Euro as the reporting currency; however, subsequent to October 1, 2013, both current and historical financial information have been translated to U.S. dollars to reflect our consolidated financial statements as if they had been historically reported in U.S. dollars.

Page 7

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 Friday, February 14, 2014 at 10:00 AM (Eastern Standard Time). Listeners can access the conference call live and archived through March 16, 2014, over the Internet at http://www.media-server.com/m/p/pwhbva7n or through a link on the Company’s home page at http://www.mercerint.com. Please allow 15 minutes prior to the call to visit the site and download and install any necessary audio software.

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.

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. Words such as “expects”, “anticipates”, “projects”, “intends”, “designed”, “will”, “believes”, “estimates”, “may”, “could” and variations of such words and similar expressions are intended to identify such forward-looking statements. Among those factors which could cause actual results to differ materially are the following: 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, CEO & President

(604) 684-1099

David M. Gandossi

Executive Vice-President,

Chief Financial Officer & Secretary

(604) 684-1099

-FINANCIAL TABLES FOLLOW-

Page 8

MERCER INTERNATIONAL INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands of U.S. dollars)

	December 31,
	2013			2012
ASSETS
Current assets
Cash and cash equivalents	$	147,728		$	137,439
Receivables		135,893			145,150
Inventories		170,908			155,979
Prepaid expenses and other		10,918			10,425
Deferred income tax		6,326			5,887
Total current assets		471,773			454,880
Long-term assets
Property, plant and equipment		1,038,631			1,066,506
Deferred note issuance costs and other		20,998			16,036
Deferred income tax		17,157			23,159
		1,076,786			1,105,701
Total assets	$	1,548,559		$	1,560,581
LIABILITIES
Current liabilities
Accounts payable and other	$	103,814		$	118,599
Pension and other post-retirement benefit obligations		1,330			1,072
Debt		60,355			60,205
Total current liabilities		165,499			179,876
Long-term liabilities
Debt		919,017			877,780
Interest rate derivative liability		46,517			66,819
Pension and other post-retirement benefit obligations		35,466			42,378
Capital leases and other		19,293			18,375
Deferred income tax		14,450			7,591
		1,034,743			1,012,943
Total liabilities		1,200,242			1,192,819
EQUITY
Shareholders’ equity
Share capital		328,549			327,818
Paid-in capital		(11,756	)		(4,481	)
Retained earnings		10,815			37,190
Accumulated other comprehensive income		31,470			28,577
Total shareholders’ equity		359,078			389,104
Noncontrolling interest (deficit)		(10,761	)		(21,342	)
Total equity		348,317			367,762
Total liabilities and equity	$	1,548,559		$	1,560,581

(1)

MERCER INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands of U.S. dollars, except per share data)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2013			2012			2013			2012
Revenues
Pulp	$	258,546		$	222,480		$	996,187		$	979,770
Energy and chemicals		24,136			22,317			92,198			92,966
		282,682			244,797			1,088,385			1,072,736
Costs and expenses
Operating costs		238,325			204,670			920,832			886,144
Operating depreciation and amortization		20,198			18,160			78,309			74,302
		24,159			21,967			89,244			112,290
Selling, general and administrative expenses		14,681			12,483			51,169			49,268
Restructuring expenses		2,560			—			6,415			—
Operating income		6,918			9,484			31,660			63,022
Other income (expense)
Interest expense		(17,372	)		(17,810	)		(69,156	)		(71,767	)
Gain (loss) on derivative instruments		3,779			3,099			19,709			4,812
Other income (expense)		1,073			156			1,215			(179	)
Total other income (expense)		(12,520	)		(14,555	)		(48,232	)		(67,134	)
Income (loss) before income taxes		(5,602	)		(5,071	)		(16,572	)		(4,112	)
Income tax benefit (provision)
Current		(378	)		(290	)		2,286			(9,531	)
Deferred		(5,611	)		(2,797	)		(11,482	)		152
Net income (loss)		(11,591	)		(8,158	)		(25,768	)		(13,491	)
Less: net loss (income) attributable to noncontrolling interest		1,758			1,495			(607	)		(2,179	)
Net income (loss) attributable to common shareholders	$	(9,833	)	$	(6,663	)	$	(26,375	)	$	(15,670	)
Net income (loss) per share attributable to common shareholders
Basic and diluted	$	(0.18	)	$	(0.12	)	$	(0.47	)	$	(0.28	)

(2)

MERCER INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands of U.S. dollars)

	For the Year Ended December 31,
	2013			2012			2011
Cash flows from (used in) operating activities
Net income (loss)	$	(25,768	)	$	(13,491	)	$	75,170
Adjustments to reconcile net income (loss) to cash flows from operating activities
Unrealized loss (gain) on derivative instruments		(21,494	)		(3,186	)		1,974
Depreciation and amortization		78,645			74,657			77,952
Deferred income taxes		11,482			(152	)		(3,309	)
Stock compensation expense		3,574			2,616			4,607
Pension and other post-retirement expense, net of funding		648			365			(374	)
Other		3,169			4,991			1,116
Changes in working capital
Receivables		13,993			10,795			(2,233	)
Inventories		(14,563	)		1,726			(24,654	)
Accounts payable and accrued expenses		(11,569	)		(17,992	)		19,837
Other		(1,792	)		(1,214	)		4,490
Net cash from (used in) operating activities		36,325			59,115			154,576
Cash flows from (used in) investing activities
Purchase of property, plant and equipment		(45,707	)		(47,203	)		(52,626	)
Proceeds on sale of property, plant and equipment		739			840			1,132
Purchase of marketable securities		—			—			(16,343	)
Proceeds on maturity of marketable securities		—			15,753			—
Note receivable		—			—			3,988
Net cash from (used in) investing activities		(44,968	)		(30,610	)		(63,849	)
Cash flows from (used in) financing activities
Repayment of debt and purchase of notes		(56,416	)		(35,440	)		(67,702	)
Proceeds from issuance of notes and borrowings of debt		74,472			—			—
Repayment of capital lease obligations		(2,593	)		(2,733	)		(4,095	)
Proceeds from (repayment of) credit facilities, net		(5,640	)		6,031			(20,491	)
Payment of note issuance costs		(3,855	)		(2,570	)		—
Proceeds from government grants		9,265			5,045			20,049
Purchase of treasury shares		—			—			(10,623	)
Net cash from (used in) financing activities		15,233			(29,667	)		(82,862	)
Effect of exchange rate changes on cash and cash equivalents		3,699			2,302			(4,166	)
Net increase (decrease) in cash and cash equivalents		10,289			1,140			3,699
Cash and cash equivalents, beginning of year		137,439			136,299			132,600
Cash and cash equivalents, end of year	$	147,728		$	137,439		$	136,299

(3)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Balance Sheets

(Unaudited)

(In thousands of U.S. dollars)

The terms of the indenture governing our 9.5% senior unsecured notes requires 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 years ended December 31, 2013 and 2012, the Restricted Group was comprised of Mercer International Inc., certain holding subsidiaries and our Rosenthal and Celgar mills. The Restricted Group excludes the Stendal mill.

	December 31, 2013
	Restricted		Unrestricted						Consolidated
	Group		Subsidiaries			Eliminations			Group
ASSETS
Current assets
Cash and cash equivalents	$	82,910	$	64,818		$	—		$	147,728
Receivables		75,987		59,906			—			135,893
Inventories		93,807		77,101			—			170,908
Prepaid expenses and other		7,742		3,176			—			10,918
Deferred income tax		3,273		3,053			—			6,326
Total current assets		263,719		208,054			—			471,773
Long-term assets
Property, plant and equipment		420,373		618,258			—			1,038,631
Deferred note issuance costs and other		10,987		10,011			—			20,998
Deferred income tax		9,894		7,263			—			17,157
Due from unrestricted group		153,851		—			(153,851	)		—
Total assets	$	858,824	$	843,586		$	(153,851	)	$	1,548,559
LIABILITIES
Current liabilities
Accounts payable and other	$	49,891	$	53,923		$	—		$	103,814
Pension and other post-retirement benefit obligations		1,330		—			—			1,330
Debt		749		59,606			—			60,355
Total current liabilities		51,970		113,529			—			165,499
Long-term liabilities
Debt		336,382		582,635			—			919,017
Due to restricted group		—		153,851			(153,851	)		—
Interest rate derivative liability		—		46,517			—			46,517
Pension and other post-retirement benefit obligations		35,466		—			—			35,466
Capital leases and other		8,523		10,770			—			19,293
Deferred income tax		14,450		—			—			14,450
Total liabilities		446,791		907,302			(153,851	)		1,200,242
EQUITY
Total shareholders’ equity (deficit)		412,033		(52,955	)		—			359,078
Noncontrolling interest (deficit)		—		(10,761	)		—			(10,761	)
Total liabilities and equity	$	858,824	$	843,586		$	(153,851	)	$	1,548,559

(4)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Balance Sheets

(Unaudited)

(In thousands of U.S. dollars)

	December 31, 2012
	Restricted		Unrestricted						Consolidated
	Group		Subsidiaries			Eliminations			Group
ASSETS
Current assets
Cash and cash equivalents	$	48,407	$	89,032		$	—		$	137,439
Receivables		80,708		64,442			—			145,150
Inventories		98,606		57,373			—			155,979
Prepaid expenses and other		7,661		2,764			—			10,425
Deferred income tax		2,885		3,002			—			5,887
Total current assets		238,267		216,613			—			454,880
Long-term assets
Property, plant and equipment		455,293		611,213			—			1,066,506
Deferred note issuance costs and other		8,712		7,324			—			16,036
Deferred income tax		12,102		11,057			—			23,159
Due from unrestricted group		134,897		—			(134,897	)		—
Total assets	$	849,271	$	846,207		$	(134,897	)	$	1,560,581
LIABILITIES
Current liabilities
Accounts payable and other	$	55,517	$	63,082		$	—		$	118,599
Pension and other post-retirement benefit obligations		1,072		—			—			1,072
Debt		7,465		52,740			—			60,205
Total current liabilities		64,054		115,822			—			179,876
Long-term liabilities
Debt		285,079		592,701			—			877,780
Due to restricted group		—		134,897			(134,897	)		—
Interest rate derivative liability		—		66,819			—			66,819
Pension and other post-retirement benefit obligations		42,378		—			—			42,378
Capital leases and other		8,008		10,367			—			18,375
Deferred income tax		7,591		—			—			7,591
Total liabilities		407,110		920,606			(134,897	)		1,192,819
EQUITY
Total shareholders’ equity (deficit)		442,161		(53,057	)		—			389,104
Noncontrolling interest (deficit)		—		(21,342	)		—			(21,342	)
Total liabilities and equity	$	849,271	$	846,207		$	(134,897	)	$	1,560,581

(5)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Statements of Operations

(Unaudited)

(In thousands of U.S. dollars)

	Three Months Ended December 31, 2013
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues
Pulp	$	150,850		$	107,696		$	—		$	258,546
Energy and chemicals		8,665			15,471			—			24,136
		159,515			123,167			—			282,682
Operating costs		124,919			113,406			—			238,325
Operating depreciation and amortization		11,115			9,083			—			20,198
Selling, general and administrative expenses		9,588			5,093			—			14,681
Restructuring expenses		1,174			1,386			—			2,560
		146,796			128,968			—			275,764
Operating income (loss)		12,719			(5,801	)		—			6,918
Other income (expense)
Interest expense		(8,687	)		(10,349	)		1,664			(17,372	)
Gain (loss) on derivative instruments		(360	)		4,139			—			3,779
Other income (expense)		2,701			36			(1,664	)		1,073
Total other income (expense)		(6,346	)		(6,174	)		—			(12,520	)
Income (loss) before income taxes		6,373			(11,975	)		—			(5,602	)
Income tax benefit (provision)		(5,789	)		(200	)		—			(5,989	)
Net income (loss)		584			(12,175	)		—			(11,591	)
Less: net loss attributable to noncontrolling interest		—			1,758			—			1,758
Net income (loss) attributable to common shareholders	$	584		$	(10,417	)	$	—		$	(9,833	)
	Three Months Ended December 31, 2012
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues
Pulp	$	126,666		$	95,814		$	—		$	222,480
Energy and chemicals		9,184			13,133			—			22,317
		135,850			108,947			—			244,797
Operating costs		111,815			92,855			—			204,670
Operating depreciation and amortization		9,664			8,496			—			18,160
Selling, general and administrative expenses		8,199			4,284			—			12,483
		129,678			105,635			—			235,313
Operating income (loss)		6,172			3,312			—			9,484
Other income (expense)
Interest expense		(7,360	)		(12,455	)		2,005			(17,810	)
Gain (loss) on derivative instruments		80			3,019			—			3,099
Other income (expense)		2,099			62			(2,005	)		156
Total other income (expense)		(5,181	)		(9,374	)		—			(14,555	)
Income (loss) before income taxes		991			(6,062	)		—			(5,071	)
Income tax benefit (provision)		(2,812	)		(275	)		—			(3,087	)
Net income (loss)		(1,821	)		(6,337	)		—			(8,158	)
Less: net loss attributable to noncontrolling interest interest		—			1,495			—			1,495
Net income (loss) attributable to common shareholders	$	(1,821	)	$	(4,842	)	$	—		$	(6,663	)

(6)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Statements of Operations

(Unaudited)

(In thousands of U.S. dollars)

	Year Ended December 31, 2013
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues
Pulp	$	561,350		$	434,837		$	—		$	996,187
Energy and chemicals		33,783			58,415			—			92,198
		595,133			493,252			—			1,088,385
Operating costs		498,952			421,880			—			920,832
Operating depreciation and amortization		43,498			34,811			—			78,309
Selling, general and administrative expenses		31,943			19,226			—			51,169
Restructuring expenses		5,029			1,386			—			6,415
		579,422			477,303			—			1,056,725
Operating income		15,711			15,949			—			31,660
Other income (expense)
Interest expense		(32,321	)		(45,011	)		8,176			(69,156	)
Gain (loss) on derivative instruments		(2,767	)		22,476			—			19,709
Other income (expense)		9,217			174			(8,176	)		1,215
Total other income (expense)		(25,871	)		(22,361	)		—			(48,232	)
Income (loss) before income taxes		(10,160	)		(6,412	)		—			(16,572	)
Income tax benefit (provision)		(9,365	)		169			—			(9,196	)
Net income (loss)		(19,525	)		(6,243	)		—			(25,768	)
Less: net income attributable to noncontrolling interest		—			(607	)		—			(607	)
Net loss attributable to common shareholders	$	(19,525	)	$	(6,850	)	$	—		$	(26,375	)
	Year Ended December 31, 2012
	Restricted			Unrestricted						Consolidated
	Group			Subsidiaries			Eliminations			Group
Revenues
Pulp	$	545,205		$	434,565		$	—		$	979,770
Energy and chemicals		36,638			56,328			—			92,966
		581,843			490,893			—			1,072,736
Operating costs		500,223			385,921			—			886,144
Operating depreciation and amortization		40,118			34,184			—			74,302
Selling, general and administrative expenses		31,688			17,580			—			49,268
		572,029			437,685			—			1,009,714
Operating income		9,814			53,208			—			63,022
Other income (expense)
Interest expense		(30,125	)		(48,934	)		7,292			(71,767	)
Gain (loss) on derivative instruments		2,609			2,203			—			4,812
Other income (expense)		6,465			648			(7,292	)		(179	)
Total other income (expense)		(21,051	)		(46,083	)		—			(67,134	)
Income (loss) before income taxes		(11,237	)		7,125			—			(4,112	)
Income tax benefit (provision)		(7,050	)		(2,329	)		—			(9,379	)
Net income (loss)		(18,287	)		4,796			—			(13,491	)
Less: net income attributable to noncontrolling interest		—			(2,179	)		—			(2,179	)
Net income (loss) attributable to common shareholders	$	(18,287	)	$	2,617		$	—		$	(15,670	)

(7)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Statements of Cash Flows

(Unaudited)

(In thousands of U.S. dollars)

	Year Ended December 31, 2013
	Restricted			Unrestricted			Consolidated
	Group			Subsidiaries			Group
Cash flows from (used in) operating activities
Net income (loss)	$	(19,525	)	$	(6,243	)	$	(25,768	)
Adjustments to reconcile net income (loss) to cash flows from operating activities
Unrealized loss (gain) on derivative instruments		982			(22,476	)		(21,494	)
Depreciation and amortization		43,833			34,812			78,645
Deferred income taxes		7,263			4,219			11,482
Stock compensation expense		3,574			—			3,574
Pension and other post-retirement expense, net of funding		648			—			648
Other		(360	)		3,529			3,169
Changes in working capital
Receivables		4,780			9,213			13,993
Inventories		1,965			(16,528	)		(14,563	)
Accounts payable and accrued expenses		(6,026	)		(5,543	)		(11,569	)
Other(1)		(13,621	)		11,829			(1,792	)
Net cash from (used in) operating activities		23,513			12,812			36,325
Cash flows from (used in) investing activities
Purchase of property, plant and equipment		(13,183	)		(32,524	)		(45,707	)
Acquisition of noncontrolling interest		(20,000	)		20,000			—
Proceeds on sale of property, plant and equipment		581			158			739
Net cash from (used in) investing activities		(32,602	)		(12,366	)		(44,968	)
Cash flows from (used in) financing activities
Repayment of debt and purchase of notes		(1,459	)		(54,957	)		(56,416	)
Proceeds from issuance of notes and borrowings of debt		52,250			22,222			74,472
Repayment of capital lease obligations		(725	)		(1,868	)		(2,593	)
Proceeds from (repayment of) credit facilities, net		(5,640	)		—			(5,640	)
Payment of note issuance costs		(1,829	)		(2,026	)		(3,855	)
Proceeds from government grants		—			9,265			9,265
Net cash from (used in) financing activities		42,597			(27,364	)		15,233
Effect of exchange rate changes on cash and cash equivalents		995			2,704			3,699
Net increase (decrease) in cash and cash equivalents		34,503			(24,214	)		10,289
Cash and cash equivalents, beginning of year		48,407			89,032			137,439
Cash and cash equivalents, end of year	$	82,910		$	64,818		$	147,728

(1) Includes intercompany working capital related transactions.

(8)

MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE

Combined Condensed Statements of Cash Flows

(Unaudited)

(In thousands of U.S. dollars)

	Year Ended December 31, 2012
	Restricted			Unrestricted			Consolidated
	Group			Subsidiaries			Group
Cash flows from (used in) operating activities
Net income (loss)	$	(18,287	)	$	4,796		$	(13,491	)
Adjustments to reconcile net income (loss) to cash flows from operating activities
Unrealized loss (gain) on derivative instruments		(983	)		(2,203	)		(3,186	)
Depreciation and amortization		40,474			34,183			74,657
Deferred income taxes		6,660			(6,812	)		(152	)
Stock compensation expense		2,616			—			2,616
Pension and other post-retirement expense, net of funding		365			—			365
Other		1,574			3,417			4,991
Changes in working capital
Receivables		(755	)		11,550			10,795
Inventories		(5,132	)		6,858			1,726
Accounts payable and accrued expenses		(9,576	)		(8,416	)		(17,992	)
Other(1)		(20,292	)		19,078			(1,214	)
Net cash from (used in) operating activities		(3,336	)		62,451			59,115
Cash flows from (used in) investing activities
Purchase of property, plant and equipment		(28,213	)		(18,990	)		(47,203	)
Proceeds on sale of property, plant and equipment		470			370			840
Proceeds on maturity of marketable securities		15,753			—			15,753
Net cash from (used in) investing activities		(11,990	)		(18,620	)		(30,610	)
Cash flows from (used in) financing activities
Repayment of debt and purchase of notes		(3,378	)		(32,062	)		(35,440	)
Repayment of capital lease obligations		(945	)		(1,788	)		(2,733	)
Proceeds from (repayment of) credit facilities, net		6,031			—			6,031
Payment of note issuance costs		(409	)		(2,161	)		(2,570	)
Proceeds from government grants		4,061			984			5,045
Net cash from (used in) financing activities		5,360			(35,027	)		(29,667	)
Effect of exchange rate changes on cash and cash equivalents		221			2,081			2,302
Net increase (decrease) in cash and cash equivalents		(9,745	)		10,885			1,140
Cash and cash equivalents, beginning of year		58,152			78,147			136,299
Cash and cash equivalents, end of year	$	48,407		$	89,032		$	137,439

(1) Includes intercompany working capital related transactions.

(9)

MERCER INTERNATIONAL INC.

COMPUTATION OF OPERATING EBITDA

(Unaudited)

(In thousands of U.S. dollars)

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 (loss) 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 (loss), 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 (loss) 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. The following tables set forth the net income (loss) attributable to common shareholders to Operating EBITDA for both the consolidated group and our Restricted Group:

	Three Months Ended December 31,						Year Ended December 31,
	2013			2012			2013			2012
Net income (loss) attributable to common shareholders	$	(9,833	)	$	(6,663	)	$	(26,375	)	$	(15,670	)
Net income (loss) attributable to noncontrolling interest		(1,758	)		(1,495	)		607			2,179
Income tax (benefit) provision		5,989			3,087			9,196			9,379
Interest expense		17,372			17,810			69,156			71,767
(Gain) loss on derivative instruments		(3,779	)		(3,099	)		(19,709	)		(4,812	)
Other (income) expense		(1,073	)		(156	)		(1,215	)		179
Operating income		6,918			9,484			31,660			63,022
Add: Depreciation and amortization		20,282			18,249			78,645			74,657
Operating EBITDA	$	27,200		$	27,733		$	110,305		$	137,679
	Three Months Ended December 31,						Year Ended December 31,
	2013			2012			2013			2012
Restricted Group(1)
Net income (loss) attributable to common shareholders	$	584		$	(1,821	)	$	(19,525	)	$	(18,287	)
Income tax (benefit) provision		5,789			2,812			9,365			7,050
Interest expense		8,687			7,360			32,321			30,125
(Gain) loss on derivative instruments		360			(80	)		2,767			(2,609	)
Other (income) expense		(2,701	)		(2,099	)		(9,217	)		(6,465	)
Operating income		12,719			6,172			15,711			9,814
Add: Depreciation and amortization		11,198			9,754			43,833			40,474
Operating EBITDA	$	23,917		$	15,926		$	59,544		$	50,288

(1) For the Restricted Group, net income (loss) attributable to common shareholders and net income (loss) are the same.

#    #    #

(10)