Raute - Company Announcement

RAUTE TO HAVE AN EUR 15 MILLION ORDER TO CHINA

Nastola, Finland, 2010-12-27 08:00 CET (GLOBE NEWSWIRE) -- RAUTE CORPORATION
STOCK EXCHANGE RELEASE 27 DECEMBER 2010 at 9:00 a.m. 


RAUTE TO HAVE AN EUR 15 MILLION ORDER TO CHINA

The contracts between Raute Corporation and Muling Kemian Wood Products Co.,
Ltd., which were announced on 3 November 2010, have taken effect. The machinery
and equipment worth about EUR 15 million will be delivered to an LVL plant to
be built in Muling, China during summer 2011. The plant will be commissioned in
the beginning of 2012. In addition to Raute's technological know-how and
reference deliveries, the Shanghai unit's delivery capability as well as local
service and after-care ability in China were factors in closing the deal. 

Muling Kemian Wood Products Co., Ltd. is a subsidiary of the Chinese public
company Dalian Kemian Wood Products Co., Ltd., which is a new operator in the
LVL industry. The machinery and equipment ordered by the company will be
delivered to a new LVL production plant in Muling. The machinery and equipment
to be delivered by Raute will have an annual rated capacity of approximately
60,000 m3 LVL. 

China is by far the world's largest producer of plywood. However, the
production is almost entirely very labor intensive and based on small
investments only. Structural LVL is for the present not produced in China. The
plant to be built will be the first in China to produce structural LVL that
meets international quality specifications. The Chinese LVL markets are
forecasted to grow strongly due to the increasing awareness of earthquake
resistance needs related to both infrastructure and housing construction. Also,
the environmental aspects of LVL increase its value compared to steel
construction of industrial premises. 

The machinery and equipment will be manufactured at Raute's main production
unit in Nastola, Finland, and at the Shanghai unit. 

Raute's production unit in Shanghai was established in 2006, and expanded in
2007 and 2010. The unit has a floor space of 3,800 m2, and it employed some 50
people at the end of September. The unit focuses on engineering that supports
local parts manufacture and on assembly and testing of subassemblies. The new
order is the largest machinery and equipment delivery from Raute's production
unit in Shanghai to date, and the first project with complete assemblies sold
directly by Raute's local subsidiary Raute (Shanghai) Machinery Co., Ltd. 

The new contract will not have an impact on Raute's net sales and financial
performance forecasts for 2010. Net sales for this year will increase and the
operating profit will be positive. 


RAUTE CORPORATION
Tapani Kiiski
President and CEO


FURTHER INFORMATION:Mr. Tapani Kiiski, President and CEO, Raute Corporation,
tel. +358 3 829 3560, mobile +358 400 814 148 

DISTRIBUTION:
NASDAQ OMX Helsinki Ltd, main media, www.raute.com

RAUTE IN BRIEF:
Raute is a technology company serving the wood products industry worldwide. Its
most important customers are the plywood and LVL industries. Raute is one of
the world's leading suppliers of mill-scale projects to these customer
industries. The total service concept also includes technology services, with
which Raute supports its customers throughout the entire life cycle of their
investments. Raute's head office is located in Nastola, Finland. Its other
production plants are in the Vancouver area of Canada, in the Shanghai area of
China, and in Kajaani, Finland. Raute's net sales declined significantly due to
the difficult market situation in 2009 and equaled EUR 36.6 million. The number
of personnel at the end of 2009 was 524. More information on the company can be
found at: www.raute.com.