Stora Enso Oyj - Company Announcement

Stora Enso plans profitability improvement actions across all Business Areas

Helsinki, Finland, 2012-10-23 11:59 CEST (GLOBE NEWSWIRE) -- STORA ENSO OYJ
STOCK EXCHANGE RELEASE 23 October 2012 at 12.59 EET 

Stora Enso plans restructuring of its operations through the permanent shutdown
of paper machine 1 at Hylte Mill in Sweden and the permanent closure of the
corrugated packaging plant at Ruovesi in Finland. In addition, Stora Enso plans
efficiency improvements at several other mills. The profitability improvement
actions are planned to reduce annual costs by EUR 36 million and reduce the
number of employees by approximately 520 altogether. Stora Enso will record a
restructuring provision and a fixed asset and working capital write-down as
non-recurring items totalling approximately EUR 42 million related to the
restructuring plans in the fourth quarter 2012 operating profit. 

Printing and Reading plans to close capacity in Sweden
Stora Enso plans the permanent shutdown of paper machine (PM) 1 at Hylte Mill
in Sweden with annual capacity 180 000 tonnes of newsprint by the end of the
fourth quarter of 2012 due to structural weakening of newsprint demand in
Europe. The planned closure and other efficiency improvements would affect
approximately 140 employees at Hylte Mill. 

Renewable Packaging streamlines operations in Finland, Sweden and Poland
Stora Enso plans permanent closure of the corrugated packaging plant at Ruovesi
in Finland in the second quarter of 2013 due to decreased demand for
offset-printed corrugated packaging in Finland and poor financial performance
of the plant. Stora Enso plans to serve Finnish offset customers through its
other offset plants in Europe. The planned closure would affect approximately
60 employees at Ruovesi. 

It is also planned to streamline operations at the Heinola, Ingerois and Pori
board plants in Finland and corrugated packaging operations at all the Swedish
units to ensure long-term competitiveness. The plans would reduce the number of
employees in Sweden and Finland by up to 100 altogether mostly by the end of
the third quarter of 2013. 

In addition, Stora Enso plans the permanent shutdown of board machine (BM) 2 at
Ostrołęka Mill in Poland as announced earlier. BM 2 is reaching the end of its
technical lifetime. The shutdown of BM 2 and related technical functions is
planned by the end of 2012. Including the effects of an overall review of
Polish board and converting operations, the number of employees in Poland would
decrease by up to 135 altogether. 

Biomaterials efficiency improvement plans
Stora Enso plans to improve efficiency at Skutskär Pulp Mill in Sweden to
reduce costs and improve the mill's competitiveness in response to the
challenging market environment. The plans would reduce the number of employees
at Skutskär Mill by approximately 60 mostly by the end of Q3 quarter of 2013. 

Building and Living plans to improve flexibility
Building and Living plans to improve flexibility and reduce costs at the Ala
and Gruvön sawmills in Sweden and Varkaus Sawmill in Finland from the first
quarter of 2013. The restructuring plans would affect approximately 25
employees at the Ala, Gruvön and Varkaus sawmills. 


Financial impacts



Segment   Annual     Annual cost      Fixed asset and   Provisions   Planned    
           sales      savings from     working capital   with cash    reduction 
           reductio   Q4 2013          write-downs       impact       in        
          n           onwards                                         personnel 
--------------------------------------------------------------------------------
Printing  No impact  EUR 16 million   EUR 10 million    EUR 17               140
 and                                                     million                
 Reading                                                                        
--------------------------------------------------------------------------------
Biomater  No impact  EUR 6 million                   -  EUR 6                 60
ials                                                     million                
--------------------------------------------------------------------------------
Building  No impact  EUR 1 million                   -            -           25
 and                                                                            
 Living                                                                         
--------------------------------------------------------------------------------
Renewabl  No impact  EUR 13 million   EUR 4 million     EUR 5                295
e                                                        million                
 Packagi                                                                        
ng                                                                              
--------------------------------------------------------------------------------
Total     No impact  EUR 36 million   EUR 14 million    EUR 28               520
                                                         million                
--------------------------------------------------------------------------------


No decisions regarding closures and employee reductions will be taken until the
local co-determination negotiations have concluded. Stora Enso would make every
effort in co-operation with local communities to help the affected personnel
find new employment opportunities, and all job openings in other Stora Enso
units would be available to those affected. 


For further information, please contact:
Jouko Karvinen, CEO, tel. +358 2046 21410
Karl-Henrik Sundström, CFO, tel. +46 1046 71660
Ulla Paajanen-Sainio, SVP, Investor Relations, tel. +358 2046 21242
Sanna Lahti, SVP, Global Communications, tel. +358 2046 21251

www.storaenso.com
www.storaenso.com/investors

Stora Enso is the global rethinker of the paper, biomaterials, wood product and
packaging industry. We always rethink the old and expand to the new to offer
our customers innovative solutions based on renewable materials. Stora Enso
employs some 30 000 people worldwide, and our sales in 2011 amounted to EUR
11.0 billion. Stora Enso shares are listed on NASDAQ OMX Helsinki (STEAV,
STERV) and Stockholm (STE A, STE R). In addition, the shares are traded in the
USA as ADRs (SEOAY) in the International OTCQX over-the-counter market. 

STORA ENSO OYJ