Financial result for 2007 good

Pulp supply and demand in balance during 2007

•    Sales EUR 1,371 million (1,311 million)
•    Operating profit EUR 186 million (212 million)
•    Profit before extraordinary items EUR 173 million (202 million)
•    Capital expenditure EUR 409 million (570 million)
•    Return on capital employed 10.6% (14.3%)
•    Equity ratio 61.4% (65.8%)
•    Net gearing 36.8% (20.4%)

Figures for the financial period and those given for comparison comply with
International Financial Reporting Standards (IFRS). All figures are unaudited. 


Financial result hit by weakening of the dollar against the euro and by sharp
rise in wood raw material prices 

Botnia Group sales for 2007 were EUR 1,371 million, five per cent higher than
for the previous year. Operating profit fell 12 per cent to EUR 186 million
(212). Both sales and operating profit benefited from the strong trend in pulp
prices, but were hit, in particular, by the weakening of the dollar against the
euro and the sharp rise in wood raw material prices. The average exchange rate
in 2007 was roughly 1.37 dollars to the euro, considerably higher than the
previous year's average of 1.26. 

The price of northern long-fibre pulp in 2007 rose by 19 per cent in dollars
and by seven per cent in euros. The price at the end of December was USD 880/t.
The price of short-fibre pulp (eucalyptus and birch) rose by 16 per cent in
dollars and by four per cent in euros, the price at the end of December being
USD 780/t. 

Return on capital employed in 2007 was 10.6 per cent (14.3). The decrease is
due to capital outlay on the Uruguay pulp mill investment. 

The pulp mill, at Fray Bentos in Uruguay, was completed on schedule in
September and was successfully started up in November. The delay in start-up
was due to the political dispute between Uruguay and Argentina concerning the
mill. Start-up had no material impact on the financial result for the year.