UPM-Kymmene - Company Announcement

UPM estimates weakening profitability for its sawn timber business; UPM plans closing of its Leivonmäki sawmill in Finland

UPM-Kymmene Corporation   Stock Exchange Release  12 June 2008  at 14:00 

UPM estimates the result for its sawn timber business will be weaker than       
forecast in the second quarter of 2008. Also the full year profitability outlook
for the sawn timber business within the Wood Products Division is expected to   
further weaken markedly.                                                        

UPM will start employee negotiations for the possible closure of Leivonmäki     
sawmill in Finland. The Leivonmäki sawmill has generated constant losses. The   
continued strongly weakening market situation and the uncertainty related to raw
material supply have further complicated the situation.                         

UPM has already during spring and summer responded to the weaker markets and    
reduced its sawmilling by temporarily limiting production at the all of the     
company's seven sawmills in Finland.                                            

Leivonmäki sawmill employs 63 people. The sawmill, located in Central Finland,  
produces spruce sawn timber and its annual production capacity is 80,000 cubic  
metres. The sawmill uses annually some 200,000 cubic metres of spruce logs.     
Leivonmäki sawmill was founded in 1960.                                         

UPM Timber supplies sawn timber and further processed timber products to the    
building, construction and joinery industries. Annual production capacity is 2.2
million cubic metres of WISA timber products. UPM Timber has 15 production units
in Austria, Finland, France and Russia. In Finland, UPM operates seven sawmills 
which are located in Lappeenranta, Kajaani, Pietarsaari, Korkeakoski, Heinola,  
Pori and Leivonmäki. UPM Timber employs 1,450 people.                           

For further information, please contact:                                        
Mr Tuomo Visanko, Senior Vice President, UPM Timber, tel. +358 400 352 990      
(after 14:30 hours)                                                             
Mr Olavi Kauppila, Senior Vice President, Investor Relations, tel. +358 204 15  
0658                                                                            

UPM-Kymmene Corporation                                                         
Pirkko Harrela                                                                  
Executive Vice President, Corporate Communications                              

DISTRIBUTION                                                                    
OMX Nordic Exchange Helsinki                                                    
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www.upm-kymmene.com                                                             


UPM, Media Desk                                                                 
Tel. +358 40 5883284, communications@upm-kymmene.com