EXHIBIT 99.1

		FOR:		MERCER INTERNATIONAL INC.
		APPROVED BY:		Jimmy S.H. Lee
				Chairman & President
				(604) 684-1099
				David M. Gandossi
				Executive Vice-President &
				Chief Financial Officer
				(604) 684-1099
For Immediate Release
				Financial Dynamics
				Investors: Eric Boyriven, Alexandra Tramont
				Media: Alecia Pulman
				(212) 850-5600

MERCER INTERNATIONAL INC. REPORTS 2005 THIRD QUARTER RESULTS

NEW YORK, NY, November 7, 2005 — Mercer International Inc. (NASDAQ: MERCS, TSX: MRI.U) today reported results for the third quarter of 2005.

Summary Selected Highlights

		Three Months Ended September 30,
		2005				2004
		(in thousands)
		(unaudited)
Results of Operations
Revenues		€	148,928			€	47,360
Income (loss) from operations			7,892				(4,751	)
Operating EBITDA(1)			21,871				5,254
Interest expense			(21,911	)			(4,200	)
Realized and unrealized gain (loss) on derivative financial instruments, net(2)			3,051				(8,105	)
Unrealized foreign exchange gain on debt			5,918				—
Net loss			(5,555	)			(9,879	)
Loss per share, basic and diluted			(0.17	)			(0.57	)
Other Data
Total pulp sales volume(3) (ADMTs)			332,282				73,128
Mill net pulp price realizations (per ADMT)		€	398			€	472

Mercer Reports 2005 Third Quarter Results		Page 2

Certain key factors affecting our 2005 third quarter results include:

	•		Revenues in the third quarter of 2005 increased by €101.6 million over the comparative period of 2004 to €148.9 million, primarily from the inclusion of production and sales from our Stendal and Celgar pulp mills.
	•		Operating EBITDA increased to €21.9 million in the current quarter from €5.3 million in the prior quarter of 2004 reflecting higher pulp sales and a contribution to income from operations of €6.1 million resulting from the sale of excess carbon emission credits by our German pulp mills. For a definition of Operating EBITDA, see page 6 of this press release and for a reconciliation of net loss to Operating EBITDA, see page 11 of the financial tables included in this press release.
	•		Interest expense increased to €21.9 million in the third quarter of 2005 from €4.2 million in the comparative period of 2004 and included €14.7 million of interest associated with the Stendal mill. In the prior period of 2004, most of the interest associated with the Stendal mill was capitalized. Interest expense in the current quarter included €6.0 million of interest relating to our $310 million 9.25% senior notes issued in February 2005.
	•		We recorded a net gain of €3.1 million on our interest rate and currency derivatives in the third quarter of 2005 (of which €3.4 million was an unrealized non-cash holding gain and €0.3 million was a realized loss), compared to a net unrealized non-cash holding loss of €8.1 million thereon in the comparative period of 2004. We also recorded an unrealized non-cash foreign exchange gain on our long-term debt of €5.9 million in the current quarter due to the strengthening of the Canadian dollar versus the U.S. dollar.
	•		Pulp markets softened in the third quarter of 2005. Average list prices for NBSK pulp in Europe decreased to $580 per ADMT from $635 per ADMT in the prior period of 2004, but such decrease was partially offset by the strengthening of the U.S. dollar versus the Euro.

Mercer Reports 2005 Third Quarter Results		Page 3

Results of Operations – 2005 Third Quarter

Selected production and sales data for the three months ended September 30, 2005 and 2004 is as follows:

		Three Months Ended September 30,
		2005				2004
		(ADMTs)
Production by Product Class:
Pulp production by mill:
Rosenthal			83,350				71,847
Celgar			118,035				—
Stendal			126,202				—
Total pulp production			327,587				71,847
Paper production			16,064				15,354
Total production			343,651				87,201
Sales Volume by Product Class:
Pulp sales volume by mill:
Rosenthal			86,772				73,128
Celgar			125,079				—
Stendal			120,431				—
Total pulp sales volume(1)			332,282				73,128
Paper sales volume			16,928				14,712
Total sales volume(1)			349,210				87,840
		(in thousands)
Revenues by Product Class:
Pulp revenues by mill:
Rosenthal		€	37,122			€	34,982
Celgar			48,978				—
Stendal			47,313				(327	)
Total pulp revenues(1)			133,413				34,655
Paper revenues			15,515				12,705
Total revenues(1)		€	148,928			€	47,360

Revenues for the three months ended September 30, 2005 increased to €148.9 million from €47.4 million in the comparative period of 2004, primarily because of higher pulp sales resulting from the inclusion of sales from our Stendal and Celgar mills. Pulp sales by volume were 332,282 ADMTs in the third quarter of 2005, compared to 73,128 ADMTs in the comparative period of 2004. In the three months ended September 30, 2005, the Stendal and Celgar mills sold 245,510 ADMTs of NBSK pulp and had sales of €96.3 million.

Cost of sales and general, administrative and other expenses in the third quarter of 2005 increased to €141.0 million from €52.1 million in the comparative period of 2004, primarily as a result of the inclusion of production from our Stendal and Celgar mills. We commenced expensing all of the costs, including interest, relating to the Stendal mill effective September 2004, prior to which most of the costs, including interest, relating to the Stendal mill were capitalized during its construction.

Mercer Reports 2005 Third Quarter Results		Page 4

For the third quarter of 2005, revenues from our pulp operations increased to €133.4 million from €34.7 million in the same period a year ago, primarily as a result of the inclusion of sales from our Stendal and Celgar mills. List prices for NBSK pulp in Europe were approximately €476 ($580) per ADMT in the third quarter of 2005, compared to approximately €519 ($635) per ADMT in the comparative period of last year. The decrease in NBSK pulp prices was partially offset by the strengthening of the U.S. dollar versus the Euro during the current period.

Pulp sales realizations decreased to €398 per ADMT on average in the third quarter of 2005 from €472 per ADMT in the third quarter of 2004, primarily as a result of lower price realizations of the Stendal and Celgar mills. The Stendal mill sold pulp at a discounted price as a result of its start up and the Celgar mill sells a large portion of its production in Asian markets which had lower sales prices than European markets.

Cost of sales and general, administrative and other expenses for the pulp operations increased to €125.5 million in the third quarter of 2005 from €32.4 million in the comparative period of 2004, primarily as a result of the inclusion of €96.9 million of operating costs related to the Stendal and Celgar mills. In the third quarter of 2005, we recorded a contribution to income from operations of €6.1 million resulting from the sale of excess carbon emission credits by our German pulp mills.

Depreciation for the pulp operations increased to €13.3 million in the current quarter, from €3.8 million in the third quarter of 2004, primarily as a result of the inclusion of €9.7 million of depreciation from the Stendal and Celgar mills.

For the third quarter of 2005, our pulp operations generated operating income of €9.2 million, versus operating income of €2.9 million in the comparative quarter of 2004, primarily as a result of the inclusion of the results of the Stendal and Celgar mills, the sale of excess carbon emission credits by our German pulp mills and lower costs and expenses at our Rosenthal mill.

Revenues from our paper operations in the current quarter increased to €15.5 million from €12.7 million in the same quarter of last year as a result of higher sales volumes.

Mercer Reports 2005 Third Quarter Results		Page 5

Cost of sales and general, administrative and other expenses for the paper operations in the third quarter of 2005 decreased to €16.6 million from €20.3 million in the comparative quarter of 2004, primarily as a result of a shift in the product mix at our paper mills.

For the third quarter of 2005, our paper operations generated an operating loss of €1.1 million, compared to an operating loss of €7.6 million in the third quarter of 2004.

In the third quarter of 2005, we had income from operations of €7.9 million, compared to a loss from operations of €4.8 million in the same quarter last year.

Interest expense in the third quarter of 2005 increased to €21.9 million from €4.2 million in the year ago period, due to interest expense of €14.7 million relating to the Stendal mill and higher borrowings resulting primarily from our $310 million senior note issue in February 2005. In the third quarter of 2004, most of the interest associated with the Stendal mill was capitalized.

Stendal entered into certain foreign currency derivatives to swap all of its long-term bank indebtedness from Euros to U.S. dollars and certain currency forwards in 2005. We recorded a net unrealized non-cash holding loss of €1.9 million before minority interests upon the marked to market valuation of such currency derivatives that were outstanding at the end of the quarter and a net loss of €0.3 million before minority interests in respect of such derivatives that matured in the quarter, due to the strengthening of the U.S. dollar versus the Euro. In the comparative quarter of 2004, we recorded a net unrealized non-cash holding gain of €6.0 million before minority interests on the then outstanding currency derivatives of Rosenthal and Stendal. In the third quarter of 2005, as a result of an increase in long-term European interest rates, we also recorded a net unrealized non-cash holding gain of €5.3 million before minority interests on the marked to market valuation of the Stendal interest rate derivatives versus a net unrealized non-cash holding loss of €14.1 million before minority interests on the interest rate derivatives of Stendal and Rosenthal in the third quarter of 2004. We also recorded an unrealized non-cash foreign exchange gain on our long-term debt of €5.9 million in the current quarter due to the strengthening of the Canadian dollar versus the U.S. dollar.

In the third quarter of 2005, minority interest, representing the two minority shareholders’ proportionate interest in the Stendal mill, was €5.7 million, compared to €6.7 million in the third quarter of 2004.

Mercer Reports 2005 Third Quarter Results		Page 6

We reported a net loss for the third quarter of 2005 of €5.6 million, or €0.17 per basic and diluted share, which reflected the inclusion of interest expense related to our Stendal mill of €14.7 million and the net realized and unrealized gain of €3.1 million on our interest rate and currency derivatives and the unrealized non-cash foreign exchange gain on our long-term debt of €5.9 million. In the third quarter of 2004, we reported a net loss of €9.9 million, or €0.57 per basic and diluted share.

We generated “Operating EBITDA” of €21.9 million and €5.3 million in the three months ended September 30, 2005 and 2004, respectively. Operating EBITDA is defined as income (loss) from operations 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 (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. 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 net loss to Operating EBITDA, see page 11 of the financial tables included in this press release.

Mercer Reports 2005 Third Quarter Results		Page 7

Liquidity

		As at				As at
		September 30, 2005				December 31, 2004
		(in thousands)
		(unaudited)
Financial Position
Cash and cash equivalents		€	89,039			€	49,568
Cash restricted			7,646				45,295
Receivables			75,696				54,687
Inventories			85,678				52,898
Prepaid expenses and other			6,446				4,961
Accounts payable and accrued expenses			94,702				56,542
Construction costs payable			1,088				65,436
Debt, current portion			37,135				107,090
Working capital (deficit)			131,580	(1)			(21,659	)
Property, plant and equipment			1,031,879				936,035
Total assets			1,409,237				1,255,649
Long-term liabilities			1,097,347	(2)			863,840
Shareholders’ equity			178,965				162,741

We had good liquidity at September 30, 2005. Certain key factors affecting our liquidity include:

	•		We had unrestricted cash and cash equivalents of €89.0 million.
	•		The current Stendal construction costs payable of €1.1 million will be paid from restricted cash of €7.6 million held for such purpose.
	•		We qualified for investment grants relating to the Stendal mill totaling approximately €10.6 million at September 30, 2005 from the federal and state governments of Germany, which we expect to receive in 2005. These grants, when received, will be applied to repay part of the €35.5 million of the current portion of our debt that has been drawn under a dedicated tranche of the Stendal loan facility. Under our accounting policies, we do not record these government grants until they are received. The balance outstanding under this dedicated tranche of the Stendal loan facility will be substantially paid from VAT credits we expect to receive in the ordinary course.
	•		Without giving effect to any government grants we expect to receive for the Stendal mill, we had net working capital of €131.6 million at September 30, 2005.

Mercer Reports 2005 Third Quarter Results		Page 8

Results of Operations – Nine Months Ended September 30, 2005

For the nine months ended September 30, 2005, revenues increased to €376.4 million from €148.0 million in the prior period, because of higher pulp sales. We generated income from operations of €16.2 million in the nine months ended September 30, 2005, compared to a loss from operations of €7.6 million in the nine months ended September 30, 2004. We generated Operating EBITDA of €55.1 million and €15.6 million in the nine months ended September 30, 2005 and 2004, respectively. For a reconciliation of net loss to Operating EBITDA, see page 11 of the financial tables included in this press release. We reported a net loss of €87.4 million or €2.86 per diluted share for the nine months ended September 30, 2005, compared to a net loss of €12.6 million or €0.73 per diluted share for the nine months ended September 30, 2004, which reflected the inclusion of certain non-capitalized interest of approximately €41.0 million related to the Stendal mill, the net realized and unrealized non-cash holding loss of €70.1 million on our interest rate and currency derivatives and the unrealized non-cash foreign exchange loss on our long-term debt of €1.6 million, partially offset by a non-cash benefit for income taxes of €14.6 million.

President’s Comments

Mr. Jimmy S.H. Lee, President and Chairman, stated: “During the current quarter, we had a three fold increase in revenues to approximately €148.9 million reflecting the acquisition of our Celgar mill and the ramp-up of our Stendal mill. Both our Rosenthal and Celgar mills had good production in the quarter and Stendal continues to ramp-up substantially on plan. We currently expect to take regular planned down-time at our pulp mills in the fourth quarter for maintenance and other improvements, which is expected to reduce our overall production for the quarter by approximately 35,000 ADMTs of pulp. During this down-time, the Stendal mill will also tie in two new digesters which will increase its production capacity in 2006.”

“Despite generally soft pulp markets, our Operating EBITDA increased sharply to approximately €21.9 million and our net loss decreased in the quarter. We believe this improvement reflects our strategy of focusing on operating modern, large and efficient production facilities.”

Mr. Lee continued: “Pulp prices were softer in the quarter with list prices in Europe averaging around €476 per ADMT. Pulp pricing in Asia, and particularly China where Celgar has a large portion of its sales, remained weak with prices averaging around €410 per ADMT in the quarter.”

He further stated: “We are, however, seeing some pulp price improvement through the partial implementation of the October price increase.” Mr. Lee said: “As NBSK pulp is priced in U.S. dollars, the recent

Mercer Reports 2005 Third Quarter Results		Page 9

strengthening of the U.S. dollar versus the Euro improved the operating results of our German pulp mills, although this was partially offset by the weakening of the U.S. dollar versus the Canadian dollar. A higher dollar generally results in increased Euro revenues.”

Mr. Lee also said: “At September 30, 2005, our balance sheet reflected the receipt of government grants relating to the Stendal mill being applied to the related debt and paying construction costs related to the Stendal mill from restricted cash. As a result, our working capital increased to approximately €131.6 million at the end of the third quarter of 2005 from a working capital deficit of approximately €21.7 million at the end of the prior quarter of 2004.”

Mr. Lee concluded: “We continue to make good progress on integrating and coordinating our global NBSK pulp marketing activities. We believe this progress coupled with our focus on production efficiencies and costs, will help us achieve our overall strategy of being a leading NBSK pulp producer and build value for our stakeholders.”

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 Tuesday, November 8, 2005 at 10:00 AM (Eastern Time). Listeners can access the conference call live and archived over the Internet through a link at the company’s web site at http://www.mercerinternational.com, or at http://phx.corporate-ir.net/playerlink.zhtml?c=62074&s=wm&e=1159175. 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 November 15, 2005 at 11:59 p.m. (Eastern Time). The replay number is (800) 642-1687, and the passcode is 2160034.

Mercer International Inc. is a global pulp and paper manufacturing company. Our production facilities are located in Germany and Canada. Our shares are quoted for trading on the Nasdaq National Market (MERCS) and listed for trading on the Toronto Stock Exchange (MRI.U), and we also have outstanding 8.5% convertible subordinated notes and 9.25% senior notes. To obtain further information on the company, please visit its web site at http://www.mercerinternational.com.

Mercer Reports 2005 Third Quarter Results		Page 10

The preceding includes forward-looking statements which involve known and unknown risks and uncertainties which may cause the company’s 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: market conditions, competition and other risk factors listed from time to time in the company’s SEC reports and other filings.

-FINANCIAL TABLES FOLLOW-

MERCER INTERNATIONAL INC.

CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2005 AND DECEMBER 31, 2004
(Euros in thousands)

		September 30,				December 31,
		2005				2004
ASSETS
Current Assets
Cash and cash equivalents		€	89,039			€	49,568
Cash restricted			7,646				45,295
Receivables			75,696				54,687
Inventories			85,678				52,898
Prepaid expenses and other			6,446				4,961
Total current assets			264,505				207,409
Long-Term Assets
Cash restricted			24,537				47,538
Property, plant and equipment			1,031,879				936,035
Investments			4,664				5,079
Deferred note issuance and other costs			8,903				5,069
Deferred income tax			74,749				54,519
			1,144,732				1,048,240
Total assets		€	1,409,237			€	1,255,649
LIABILITIES
Current Liabilities
Accounts payable and accrued expenses		€	94,702			€	56,542
Construction costs payable			1,088				65,436
Debt, current portion			37,135				107,090
Total current liabilities			132,925				229,068
Long-Term Liabilities
Debt, less current portion			923,144				777,272
Unrealized foreign exchange rate derivative losses			49,346				—
Unrealized interest rate derivative losses			90,637				75,471
Pension and other post-retirement benefit obligations			17,008				—
Capital leases and other			9,562				9,035
Deferred income tax			7,650				2,062
			1,097,347				863,840
Total liabilities			1,230,272				1,092,908
Minority Interest			—				—
SHAREHOLDERS’ EQUITY
Shares of beneficial interest			181,600				83,397
Additional paid-in capital, stock options			14				14
Retained earnings (deficit)			(18,197	)			69,176
Accumulated other comprehensive income			15,548				10,154
Total shareholders’ equity			178,965				162,741
Total liabilities and shareholders’ equity		€	1,409,237			€	1,255,649

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MERCER INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
For the Nine Months Ended September 30, 2005 and 2004
(Unaudited)
(Euros in thousands, except per share data)

		2005				2004
Revenues		€	376,430			€	148,011
Costs and expenses:
Cost of sales			350,185				127,859
General and administrative expenses			22,399				21,108
Gain on sale of emission credits			(12,353	)			—
Impairment of capital assets			—				6,000
Flooding losses and expenses, less grant income			—				669
Total costs and expenses			360,231				155,636
Income (loss) from operations			16,199				(7,625	)
Other income (expense):
Interest expense			(63,320	)			(9,554	)
Investment income			1,594				1,679
Realized loss on derivative financial instruments			(2,455	)			—
Unrealized loss on derivative financial instruments			(67,804	)			(1,077	)
Unrealized foreign exchange loss on debt			(1,591	)			—
Impairment of investments			(1,699	)			—
Total other income (expense)			(135,275	)			(8,952	)
Loss before income taxes and minority interest			(119,076	)			(16,577	)
Income tax benefit			14,627				37
Loss before minority interest			(104,449	)			(16,540	)
Minority interest			17,076				3,936
Net loss			(87,373	)			(12,604	)
Retained earnings, beginning of period			69,176				49,196
Retained earnings (deficit), end of period		€	(18,197	)		€	36,592
Loss per share
Basic and diluted		€	(2.86	)		€	(0.73	)

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MERCER INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 2005 and 2004
(Unaudited)
(Euros in thousands, except per share data)

		2005				2004
Revenues		€	148,928			€	47,360
Costs and expenses:
Cost of sales			140,018				39,231
General and administrative expenses			7,083				6,880
Gain on sale of emission credits			(6,065	)			—
Impairment of capital assets			—				6,000
Total costs and expenses			141,036				52,111
Income (loss) from operations			7,892				(4,751	)
Other income (expense):
Interest expense			(21,911	)			(4,200	)
Investment income			613				215
Realized loss on derivative financial instruments			(284	)			—
Unrealized gain (loss) on derivative financial instruments			3,335				(8,105	)
Unrealized foreign exchange gain on debt			5,918				—
Total other income (expense)			(12,329	)			(12,090	)
Loss before income taxes and minority interest			(4,437	)			(16,841	)
Income tax (provision) benefit			(6,785	)			236
Loss before minority interest			(11,222	)			(16,605	)
Minority interest			5,667				6,726
Net loss			(5,555	)			(9,879	)
Retained earnings (deficit), beginning of period			(12,642	)			46,471
Retained earnings (deficit), end of period		€	(18,197	)		€	36,592
Loss per share
Basic and diluted		€	(0.17	)		€	(0.57	)

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MERCER INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2005 and 2004
(Unaudited)
(Euros in thousands)

		2005				2004
Cash Flows from (used in) Operating Activities:
Net loss		€	(87,373	)		€	(12,604	)
Adjustments to reconcile net loss to cash flows from operating activities
Unrealized losses on derivatives			67,804				1,077
Depreciation and amortization			39,599				17,217
Unrealized foreign exchange loss on debt			1,591				—
Impairment of capital assets			—				6,000
Impairment of investments and securities			1,699				—
Minority interest			(17,076	)			(3,936	)
Deferred income taxes			(14,642	)			—
Stock compensation expense			330				690
Other			144				1,139
Changes in current assets and liabilities
Receivables			(20,428	)			(2,056	)
Inventories			(9,581	)			(35,825	)
Accounts payable and accrued expenses			33,765				26,331
Other			(1,435	)			782
Net cash used in operating activities			(5,603	)			(1,185	)
Cash Flows from (used in) Investing Activities:
Cash restricted			60,650				(17,517	)
Purchase of property, plant and equipment			(18,646	)			(241,825	)
Acquisition of Celgar pulp mill			(146,608	)			—
Sale of available-for-sale securities			—				1,161
Other			—				115
Net cash used in investing activities			(104,604	)			(258,066	)
Cash Flows from (used in) Financing Activities:
Increase (decrease) in construction costs payable			(64,348	)			118,196
Proceeds from borrowings of notes payable and debt			311,792				126,000
Repayment of notes payable and debt			(261,691	)			(21,886	)
Proceeds from investment grants			78,595				28,710
Repayment of capital lease obligations			(2,930	)			(1,781	)
Issuance of shares of beneficial interest			67,329				582
Net cash from financing activities			128,747				249,821
Effect of exchange rate changes on cash and cash equivalents			20,931				80
Net increase (decrease) in cash and cash equivalents			39,471				(9,350	)
Cash and cash equivalents, beginning of period			49,568				51,993
Cash and cash equivalents, end of period		€	89,039			€	42,643

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MERCER INTERNATIONAL INC.

BUSINESS SEGMENT INFORMATION
For the Nine Months Ended September 30, 2005 and 2004
(Unaudited)
(Euros in thousands)

																						Corporate,
		Rosenthal				Celgar(1)				Stendal				Total								Other and				Consolidated
		Pulp				Pulp				Pulp				Pulp				Paper				Eliminations				Total
Nine Months Ended September 30, 2005
Sales to external customers		€	103,058			€	97,458			€	128,919			€	329,435			€	46,995			€	—			€	376,430
Intersegment net sales			—				—				4,679				4,679				—				(4,679	)			—
			103,058				97,458				133,598				334,114				46,995				(4,679	)			376,430
Operating costs			73,146				86,438				112,739				272,323				44,879				(5,879	)			311,323
Depreciation and amortization			10,173				7,083				20,179				37,435				592				835				38,862
General and administrative			5,441				5,285				3,120				13,846				3,720				4,833				22,399
Emission credits			(4,402	)			—				(7,951	)			(12,353	)			—				—				(12,353	)
			84,358				98,806				128,087				311,251				49,191				(211	)			360,231
Income (loss) from operations			18,700				(1,348	)			5,511				22,863				(2,196	)			(4,468	)			16,199
Interest expense																											(63,320	)
Investment income																											1,594
Derivative financial instruments, net																											(70,259	)
Foreign exchange loss on debt																											(1,591	)
Impairment of investments																											(1,699	)
																											(135,275	)
Loss before income taxes and minority interest																										€	(119,076	)
Segment assets		€	341,732			€	251,918			€	787,388			€	1,381,038			€	22,783			€	5,416			€	1,409,237
Nine Months Ended September 30, 2004
Sales to external customers		€	106,013			€	—			€	600			€	106,613			€	41,398			€	—			€	148,011
Intersegment net sales			1,822				—				—				1,822				—				(1,822	)			—
			107,835				—				600				108,435				41,398				(1,822	)			148,011
Operating costs			72,705				—				509				73,214				39,686				(1,742	)			111,158
Depreciation and amortization			14,166				—				795				14,961				1,740				—				16,701
General and administrative			7,960				—				6,645				14,605				3,886				2,617				21,108
Impairment of assets			—				—				—				—				6,000				—				6,000
Flooding grants, less losses and expenses			—				—				—				—				669				—				669
			94,831				—				7,949				102,780				51,981				875				155,636
Income (loss) from operations			13,004				—				(7,349	)			5,655				(10,583	)			(2,697	)			(7,625	)
Interest expense																											(9,554	)
Investment and other income																											1,679
Derivative financial instruments, net																											(1,077	)
																											(8,952	)
Loss before income taxes and minority interest																										€	(16,577	)
Segment assets		€	384,764			€	—			€	773,081			€	1,157,845			€	31,699			€	3,183			€	1,192,727

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MERCER INTERNATIONAL INC.

BUSINESS SEGMENT INFORMATION
For the Three Months Ended September 30, 2005 and 2004
(Unaudited)
(Euros in thousands)

																						Corporate,
		Rosenthal				Celgar(1)				Stendal				Total								Other and				Consolidated
		Pulp				Pulp				Pulp				Pulp				Paper				Eliminations				Total
Three Months Ended September 30, 2005
Sales to external customers		€	37,122			€	48,978			€	47,313			€	133,413			€	15,532			€	—			€	148,928
Intersegment net sales			—				—				1,339				1,339				—				(1,339	)			—
			37,122				48,978				48,652				134,752				15,515				(1,339	)			148,928
Operating costs			25,741				45,884				41,193				112,818				15,278				(2,057	)			126,039
Depreciation and amortization			3,543				2,986				6,725				13,254				213				512				13,979
General and administrative			1,631				2,448				1,443				5,522				1,158				403				7,083
Emission credits			(2,267	)			—				(3,798	)			(6,065	)			—				—				(6,065	)
			28,648				51,318				45,563				125,529				16,649				(1,142	)			141,036
Income (loss) from operations			8,474				(2,340	)			3,089				9,223				(1,134	)			(197	)			7,892
Interest expense																											(21,911	)
Investment income																											613
Derivative financial instruments, net																											3,051
Foreign exchange gain on debt																											5,918
																											(12,329	)
Loss before income taxes and minority interest																										€	(4,437	)
Three Months Ended September 30, 2004
Sales to external customers		€	34,982			€	—			€	(327	)		€	34,655			€	12,705			€	—			€	47,360
Intersegment net sales			643				—				—				643				—				(643	)			—
			35,625				—				(327	)			35,298				12,705				(643	)			47,360
Operating costs			23,580				—				509				24,089				12,473				(1,425	)			35,137
Depreciation and amortization			3,030				—				783				3,813				599				(318	)			4,094
General and administrative			3,324				—				1,197				4,521				1,243				1,116				6,880
Impairment of assets			—				—				—				—				6,000				—				6,000
Flooding grants, less losses and expenses			—				—				—				—				—				—				—
			29,934				—				2,489				32,423				20,315				(627	)			52,111
Income (loss) from operations			5,691				—				(2,816	)			2,875				(7,610	)			(16	)			(4,751	)
Interest expense																											(4,200	)
Investment and other income																											215
Derivative financial instruments, net																											(8,105	)
																											(12,090	)
Loss before income taxes and minority interest																										€	(16,841	)

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MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Balance Sheet
As at September 30, 2005
(Unaudited)
(Euros in thousands)

The terms of the indenture governing our 9.25% senior unsecured notes requires that we provide the results of operations and financial condition of Mercer International Inc. excluding its subsidiaries (“Mercer Inc.”) and our restricted subsidiaries under the indenture, collectively referred to as the “Restricted Group”. As at and during the nine and three months ended September 30, 2005, the Restricted Group was comprised of Mercer Inc., certain holding subsidiaries and Rosenthal, and the Celgar mill from the date of its acquisition on February 14, 2005. During the nine and three months ended September 30, 2004 and as at December 31, 2004, the Restricted Group was comprised of Mercer Inc., certain holding subsidiaries and Rosenthal, which was the only member of the Restricted Group with material operations during this period. We acquired the Celgar mill in February 2005 and, as a result, its operations for the nine and three months ended September 30, 2004 and financial condition at December 31, 2004 are not included for such periods. The Restricted Group excludes our paper operations and the Stendal mill.

		September 30, 2005
		Restricted				Unrestricted								Consolidated
		Group				Subsidiaries				Eliminations				Group
ASSETS
Current assets
Cash and cash equivalents		€	52,566			€	36,473			€	—			€	89,039
Cash restricted			—				7,646				—				7,646
Receivables			40,758				35,113				(175	)			75,696
Inventories			50,875				34,803				—				85,678
Prepaid expenses and other			3,968				2,478				—				6,446
Total current assets			148,167				116,513				(175	)			264,505
Cash restricted			—				24,537				—				24,537
Property, plant and equipment			397,071				635,468				(660	)			1,031,879
Other			9,483				4,084				—				13,567
Deferred income tax			21,516				53,233				—				74,749
Due from unrestricted group			45,473				—				(45,473	)			—
Total assets		€	621,710			€	833,835			€	(46,308	)		€	1,409,237
LIABILITIES
Current liabilities
Accounts payable and accrued expenses		€	36,128			€	58,749			€	(175	)		€	94,702
Construction costs payable			—				1,088				—				1,088
Debt, current portion			—				37,135				—				37,135
Total current liabilities			36,128				96,972				(175	)			132,925
Debt, less current portion			342,221				580,923				—				923,144
Due to restricted group			—				45,473				(45,473	)			—
Unrealized derivatives loss			—				139,983				—				139,983
Other			20,152				6,418				—				26,570
Deferred income tax			3,845				3,805				—				7,650
Total liabilities			402,346				873,574				(45,648	)			1,230,272
SHAREHOLDERS’ EQUITY
Total shareholders’ equity			219,364				(39,739	) (1)			(660	)			178,965
Total liabilities and shareholders’ equity		€	621,710			€	833,835			€	(46,308	)		€	1,409,237

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MERCER INTERNATIONAL INC.

RESTRICTED GROUP SUPPLEMENTAL DISCLOSURE
Combined Condensed Balance Sheet
As at December 31, 2004
(Unaudited)
(Euros in thousands)

		December 31, 2004
		Restricted				Unrestricted								Consolidated
		Group				Subsidiaries				Eliminations				Group
ASSETS
Current assets
Cash and cash equivalents		€	45,487			€	4,081			€	—			€	49,568
Cash restricted			—				45,295				—				45,295
Receivables			21,791				33,060				(164	)			54,687
Inventories			13,911				38,987				—				52,898
Prepaid expenses and other			1,995				2,966				—				4,961
Total current assets			83,184				124,389				(164	)			207,409
Cash restricted			28,464				19,074				—				47,538
Property, plant and equipment			213,678				722,394				(37	)			936,035
Other			5,936				4,212				—				10,148
Deferred income tax			26,592				27,927				—				54,519
Due from unrestricted group			43,467				—				(43,467	)			—
Total assets		€	401,321			€	897,996			€	(43,668	)		€	1,255,649
LIABILITIES
Current liabilities
Accounts payable and accrued expenses		€	19,615			€	37,091			€	(164	)		€	56,542
Construction costs payable			—				65,436				—				65,436
Debt, current portion			15,089				92,001				—				107,090
Total current liabilities			34,704				194,528				(164	)			229,068
Debt, less current portion			224,542				552,730				—				777,272
Due to restricted group			—				43,467				(43,467	)			—
Unrealized interest rate derivative			—				75,471				—				75,471
Other			1,878				7,157				—				9,035
Deferred income tax			1,719				343				—				2,062
Total liabilities			262,843				873,696				(43,631	)			1,092,908
SHAREHOLDERS’ EQUITY
Total shareholders’ equity			138,478				24,300				(37	)			162,741
Total liabilities and shareholders’ equity		€	401,321			€	897,996			€	(43,668	)		€	1,255,649