UPM-Kymmene - Company Announcement

UPM introduces a new cash flow based dividend policy

UPM-Kymmene Corporation  Stock exchange release  February 3, 2015 at 9:38 EET

UPM introduces a new cash flow based dividend policy

UPM Board of Directors has approved a new dividend policy according to which
the company aims to pay an attractive dividend, 30-40% of the company's annual
operating cash flow per share. 

The new policy is clear and transparent to the investors. Operating cash flow
is one of UPM's key performance indicators. Consistently strong cash flow is
also one of UPM's strengths. 

In 2014, UPM introduced long term return targets for the six business areas.
For the full year, four of the six businesses reached and exceeded their return
targets. At the Group level, UPM's financial targets are based on return on
equity and gearing. For the 2014, UPM's return on equity excluding special
items was 8.3% and gearing 32% at the end of the year. Operating cash flow per
share was EUR 2.33. 

With good performance in the businesses, strong cash flow, and leading balance
sheet in the industry, the company can simultaneously distribute an attractive
dividend, implement focused growth projects and act on strategic opportunities. 

In line with the new policy the Board proposes a dividend of EUR 0.70 for 2014
to the company's Annual General Meeting to be held on 9 April 2015. The
proposed dividend represents 30% of the operating cash flow per share in 2014
and is 17% higher than the dividend for 2013. 

For further information please contact: Tapio Korpeinen, CFO, tel: +358 20 415
0004. 

Notes to the editor: According to the earlier policy the dividend was at least
one third of net cash flow from operating activities less operational capital
expenditure. The cash flow was calculated as an average over three years. 

UPM-Kymmene Corporation
Pirkko Harrela
Executive Vice President, Stakeholder Relations

UPM, Media Desk
9.00-16.00 EET
tel. +358 40 588 3284
media@upm.com


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Through the renewing of the bio and forest industries, UPM is building a
sustainable future across six business areas: UPM Biorefining, UPM Energy, UPM
Raflatac, UPM Paper Asia, UPM Paper Europe and North America and UPM Plywood.
Our products are made of renewable raw materials and are recyclable. We serve
our customers worldwide. The group employs around 20,000 people and its annual
sales are approximately EUR 10 billion. UPM shares are listed on NASDAQ OMX
Helsinki. UPM - The Biofore Company - www.upm.com