UPM plans to restructure its Finnish sawn timber and further processing businesses
UPM plans to restructure its Finnish sawn timber and further processing
(UPM, Helsinki, 11 April 2012 at 9:30 EET) – UPM clarifies the strategy of its
Timber and Living business areas and plans to restructure the production
operations in Finland. The plan includes a possible closing of the production
of Kajaani sawmill and Heinola and Aureskoski further processing plants by the
end of 2012. UPM will begin co-determination negotiations with the employees in
Kajaani, Aureskoski and Heinola, and later during April-May with the employees
in the Finnish staff functions. Altogether 275 employees are included in the
negotiations. Sale is an alternative option for closure of the production
”The profitability of the sawmills and further processing units located
furthest from our integrated mills has been weak for a long time and has not
turned permanently profitable despite the earlier restructuring measures. High
log price and over capacity in the end-product markets have weakened the
situation,” says the President of UPM’s Energy and Pulp Business Group Heikki
”Our plan is to continue sawmilling and further processing in Finland in four
locations, Pietarsaari (Alholma), Pori (Seikku), Juupajoki (Korkeakoski) and
Lappeenranta (Kaukas), which are close to our pulp and paper mills using big
volumes of wood. Saw mills and further processing plants operating close to
pulp and paper mills have a central role in UPM’s wood sourcing supply chain as
their by-products are used in the production of pulp, paper and energy.”
”The Kajaani, Heinola and Aureskoski production units have good foundations to
succeed as independent units what makes the sale of the units a considerable
alternative,” says Vappula.
As part of the clarification of the Timber business strategy, UPM will assess
the operational preconditions and role of the Pestovo saw mill and planing mill
in Russia by the end of 2012.
The Aigrefeuille further processing plant in France and the Steyrermühl sawmill
in Austria will continue their operations as before and are excluded from the
above mentioned plan.
The plans have no effect on UPM’s current customer commitments or other valid
In the second quarter of 2012, UPM will book impairment charges of
approximately EUR 35 million and make a provision for restructuring costs of
approximately EUR 10 million.
The strategy development of UPM Timber and Living business areas will proceed
in UPM’s internal work groups. Mr Anssi Klinga has been appointed the new head
of the businesses, Senior Vice President, UPM Timber and Living Business Area.
He has a long experience of international management positions and he most
recently held the position of the CEO of Vaahto Group.
Heikki Vappula, UPM, President, Energy and Pulp Business Group, tel. +358 400
Finnish press conferences today at 13 EET:
Kajaani, Sawmill office, with Matti Nordberg, Director, Production and
Parkano, UPM Aureskoski, Aurejärventie 70, with Kaj Kulp, Director, Business
Development, UPM Timber and Living
Heinola, Sawmill office, with Aki Temmes, Director, Business Control, UPM
Timber and Living
Lahti, Niemenkatu 16, with Heikki Vappula, President, Energy and Pulp Business
Contact person: Antti Ratia, Head of Communications, UPM Timber and Living,
tel. +358 40 487 2173
Notes to editors:
UPM Living manufactures sustainable, beautiful and recyclable wood-based
products for consumers and industry. Manufactured from certified wood raw
materials, the products can be used to create top-quality interior decoration
solutions or build a high-quality garden or house. The seven UPM Living
production facilities are located in Finland (Aureskoski, Heinola,
Lappeenranta, Uusikaarlepyy, Pori), France (Aigrefeuille) and Russia (Pestovo).
UPM Timber manufactures top-class sawn pine and spruce timber for the
construction and joinery industries. UPM Timber annually produces around 2.3
million cubic metres of timber from wood acquired from certified forests. UPM's
seven sawmills are located in Finland, Austria and Russia. In Finland, UPM
operates five sawmills in Lappeenranta (Kaukas), Kajaani, Pietarsaari
(Alholma), Korkeakoski and Pori (Seikku). www.upmtimber.com
Kajaani sawmill employs 83 people and manufactures sawn pine and spruce timber
with an annual production capacity of 210,000 cubic metres.
Aureskoski further processing plant has 53 employees. The plant produces
interior panels and floorings with an annual production capacity of 130,000
Heinola further processing plant employs 46 people and produces laminated wood
panels with an annual production capacity of 20,000 cubic metres.
The UPM Timber and Living business area staff functions in Finland employ 90
UPM, Corporate Communications
Media Desk, tel. +358 (0)40 588 3284