Stora Enso Oyj - Company Announcement

Stora Enso CEO Jouko Karvinen comments on first quarter 2011 results announced today

“Strong quarter - increasing concerns about cost inflation”

Helsinki, Finland, 2011-04-20 12:01 CEST (GLOBE NEWSWIRE) -- STORA ENSO OYJ
STOCK EXCHANGE RELEASE 20 April 2011 at 13.01 EET 

“Three months ago we promised improved earnings through better pricing and an
improved cost base - and that is what the team delivered. We are pleased to
report first quarter results for 2011 showing significant profitability
improvement driven by broad and strong year-on-year pricing improvement in
every segment. It is also important that these improvements were not solely due
to market recovery, which was actually quite limited, but they also reflect a
conscious effort to improve pricing quality even when that has meant limiting
volumes and capacity. They are also a result of our cost base reduction we
started several years ago. 

“The productivity and cost improvements will continue in Stora Enso through
hundreds of local improvement efforts as we rethink the ways we do things - or
whether we should be doing some things at all. As the operating environment
during the past three months with increasing inflation pressure clearly shows,
the race is never over. The increasing inflation is now our short-term focus
and concern. Only three months ago we estimated inflation would be
approximately 3% year on year. Now we have revised our forecast to 4%. The key
reason for the increased estimate is the rising costs of recycled fibre and
some chemicals. This development, which we will have to watch closely in the
changing environment, means that our ongoing efforts to improve costs,
productivity, and customer and product mix continue to be even more important. 

“The strategic growth projects we have announced so far this year are proof
points of our progress. We have launched the implementation of the Montes del
Plata world-class pulp mill in Uruguay and announced the investment in a new
containerboard machine at Ostrołęka in Poland to produce stronger material for
making lighter packaging. We are expanding the production of pre-manufactured
construction elements in Austria to provide a strong basis for further growth
in building solutions, including wooden multi-storey buildings, and today we
announced an improvement investment in our Skoghall liquid packaging board mill
in Sweden. Four concrete steps to strengthen Stora Enso's position in the
high-return growth areas. 

“We feel passionate about our improvement processes and the future. We also
think it is time to tell the world about Rethink. We have been and will
continue challenging ourselves in everything we do - from products and customer
support to our corporate responsibility - and with a new corporate identity, as
we explain in a separate press release. We will continue on our journey of
improvement and to implement our strategy - and are aiming to increase our
speed.” 

For further information, please contact:
Jouko Karvinen, CEO, tel. +358 2046 21410
Lauri Peltola, Head of Communications and Global Responsibility, tel. +358 2046
21380 
Ulla Paajanen-Sainio, Head of Investor Relations, tel. +358 2046 21242


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


Stora Enso is the global rethinker of the packaging, paper and wood products
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 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