Stora Enso Oyj - Company Announcement

Stora Enso plans permanent closure of Kopparfors Sawmill and the pellet mill to improve the profitability of its Swedish Wood Products operations

Helsinki, Finland, 2011-03-22 08:00 CET (GLOBE NEWSWIRE) -- STORA ENSO OYJ
STOCK EXCHANGE RELEASE 22 March 2011 at 9.00 EET 

Stora Enso is planning to permanently close down Kopparfors Sawmill in Sweden
by the end of 2011 due to several years of losses and no feasible options for
improvement. The plan also includes closing down the pellet mill. 

“Despite several years of focused efforts to turn around the losses of
Kopparfors Sawmill, we have been unable to achieve the improvements needed in
efficiency and profitability. The slowness of the recovery in markets combined
with poor operational efficiency, high raw material costs, unfavourable
exchange rates and lack of cost flexibility have kept Kopparfors loss-making.
In our analysis, even in the most optimistic scenario, we can see potential for
only marginal improvement,” says Hannu Kasurinen, EVP, Stora Enso Wood
Products. “This is of course a difficult message for our employees in Kopparfors. The
closure would affect not only the people who work at Kopparfors Sawmill and the
pellet mill, but also many people in the community. We will do everything we
can in close co-operation with the local community and authorities to help
every employee affected by the plans to find re-employment options. 

“We are investigating alternatives for supplying our key customers and plan to
utilise some of the sawmill and pellet mill machinery at other Stora Enso
locations. The planned mill closure would not affect wood purchasing in
Sweden.” 

The Group will record a one-time non-cash fixed asset and working capital
write-down of approximately EUR 20 million and in addition a restructuring
provision with a cash impact of approximately EUR 9 million as non-recurring
items in its first quarter 2011 operating profit. Based on 2010 annual figures
the closure would reduce Stora Enso's annual sales by approximately EUR 65
million but have no material impact on the Group's annual operating profit. The
planned closure will have a positive tax impact of approximately EUR 8 million
in the first quarter of 2011. 

Kopparfors Sawmill has an annual production capacity of 310 000 m3 of sawnwood,
of which 150 000 m3 can be further processed by planing. The pellet mill has an
annual capacity of 160 000 tonnes. Kopparfors has 110 employees. 

The measures are subject to negotiations under the Swedish Co-determination Act
(MBL). 

For further information, please contact:
Hannu Kasurinen, EVP, Stora Enso Wood Products, tel. +358 2046 21222
Mats Nordlander, EVP, Country Manager Sweden, tel. +46 1046 72703
Olle Berg, SVP, Marketing and Sales, Stora Enso Wood Products, tel. +46 1046
717 64 
Jonas Nordlund, Director, Communications in Sweden, tel. +46 1046 71663
Ulla Paajanen-Sainio, Head of Investor Relations, tel. +358 2046 21242


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


Stora Enso is a global paper, packaging and wood products company producing
newsprint and book paper, magazine paper, fine paper, consumer board,
industrial packaging and wood products. The Group is the world leader in forest
industry sustainability. We offer our customers solutions based on renewable
raw materials. Our products provide a climate-friendly alternative to many
non-renewable materials, and have a smaller carbon footprint. Stora Enso is
listed in the Dow Jones Sustainability Index and the FTSE4Good Index. Stora
Enso employs some 26 000 people worldwide, and our sales in 2010 amounted to
EUR 10.3 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