Stora Enso CEO Jouko Karvinen comments on third quarter 2011 results announced today
Oct 21, 2011
OTC Disclosure News Service
Helsinki, Finland –
“Solid quarter, measures to fight the economic reality continue and increase”
STORA ENSO OYJ STOCK EXCHANGE RELEASE 21 October 2011 at 13.01 EET
“We finished the third quarter as planned. The business areas performed as expected, but associated companies underperformed, essentially due to currency impact.
“In July we forecast rapidly increasing economic uncertainty and the need to plan for alternative demand scenarios going forward. We described the early signs of weakening demand and sales channel inventory reductions in Fine Paper and Wood Products. Whereas we see for example in coated fine paper stabilisation after inventory corrections, it is clear that going into the fourth quarter our customers, as well as ourselves, will reduce inventories and therefore we will further step up the manufacturing curtailments which we already increased significantly in the third quarter. If temporary lay-offs are planned, they will be subject to co-determination negotiations.
“As before, in a rapidly changing business environment our priorities are clear: cash preservation, defending our margins through active capacity management, minimising the number of underutilised assets by product swaps and continued cost-efficiency actions. The good news is that we are now in a stronger position than a few years ago due to lower fixed costs. We have enhanced flexibility through outsourcing and other means of decreasing the negative earnings impact of reduced demand. This path of improvements in costs and productivity, but also flexibility is one we will continue to follow.
“Looking further ahead, our current strategic projects – the Montes del Plata pulp mill in Uruguay, the Ostrołęka containerboard machine in Poland and the cross-laminated timber investment in Austria – are proceeding according to plan. Inpac acquisition was completed in the third quarter. Our strong balance sheet and cash position gives us a solid platform to pursue our future in our selected growth areas.”
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
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 30 000 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
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