M-real starts a new internal profit improvement programme for 2011

M-real Corporation Stock Exchange Release on 13 January 2011 at 12

M-real Corporation, part of Metsäliitto Group, starts a new profit improvement programme for the year 2011. The programme focuses on improving the paper business profitability as well as decreasing variable costs of all businesses. The earlier announced profit improvement impact of Simpele and Kemi cartonboard investments and the closure of the speciality paper production at Simpele are included in the new profit improvement programme.

The planned measures are expected to improve M-real's annual operating result by EUR 70 million with full effect from 2012 onwards. The planned measures would improve 2011 result by approximately EUR 30 million. The result in 2011 is thus expected to improve in total by approximately EUR 90 million including the impact of the new programme and the previous years' profit improvement programmes.

“M-real has good possibility to mostly cover the accelerated cost inflation by own profit improvement measures. In addition to the earlier implemented measures and this new programme, further profit improvement actions will be searched. The focus of the earlier profit improvement programmes has been on decreasing fixed costs. M-real has, in upcoming years, significant profit improvement potential especially in variable costs, concerning primarily chemical, energy and logistic costs”, says Mikko Helander, CEO of M-real.

M-real will continue the actions to eliminate the losses of its paper businesses that would result as a rise in the company’s profitability to a new improved level.

M-REAL CORPORATION

         For further information, please contact:
         
         Matti Mörsky, CFO, tel. +358 10 465 4913
         
         Juha Laine, Vice President, Investor Relations and Communications, tel. +358 10 465 4335