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Stora Enso Restructuring to Improve Cost Competitiveness

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Stora Enso, Helsinki, Finland, reports that its Fine Paper Business Area is re-evaluating working methods and building a new business model to increase cost competitiveness. According to the plans, the company would restructure operations at the Nymolla Mill in Sweden. Operations at the Uetersen Mill in Germany will be restructured more towards Specialty Papers. At the Oulu Mill in Finland, together with the sheeting plants in Belgium and the U.K., Stora Enso will find the most efficient way to utilize converting capacity and streamline operations.

Starting this year, Stora Enso Fine Paper plans to reduce annual costs by approximately EUR 20 million, with all actions to be completed by the end of the second quarter of 2012. The proposed restructuring measures would affect up to 285 employees in Finland, Sweden, Germany, Belgium, and the U.K. The company will record a cash provision of approximately EUR 16 million as a non-recurring item in the second quarter 2011 operating profits. The plans would not affect the Business Area's paper production capacities.

The company notes that the outcome of these plans will depend on the result of the local co-determination procedures. As before, 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.

"The plans announced today would make Stora Enso Fine Paper more flexible and cost efficient, and so better able to meet customer and market expectations. Fine paper demand is still clearly below pre-crisis levels, and there are no signs of sustained recovery. We have been successfully remodeling our operations during the past few years, and now we plan to continue on the chosen path of improving our existing businesses. We are comparing the best practices at all our mills so we can continuously adopt the most efficient ways of working. Similarly, we need to question our way of running the operations. These plans are part of rethinking at Stora Enso, but of course rethink means much more for us, such as new products and services, new solutions with our customers—better solutions for the future," said Hannu Alalauri, EVP, Fine Paper Business Area.


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