M-REAL KIRKNIEMI STARTS RATIONALISATION
M-real Corporation Stock Exchange Bulletin 31.10.2003 at 10.15 M-REAL KIRKNIEMI STARTS RATIONALISATION NEGOTIATIONS M-real Corporations Kirkniemi mill will start rationalisation negotiations concerning the entire personnel. The company needs to boost the efficiency of the mills operations and lower costs in order to maintain competitiveness. The estimated staff reduction requirement is a total of 180 employees. The redundancies are to be implemented by the end of 2005. At present, about 850 people work at the Kirkniemi mill. The grounds for starting rationalisation negotiations are the planned closure of the Kirkniemi mills older groundwood plant, the changing operational model for maintenance as well as productivity and economical reasons. According to plans, the procurement of mechanical pulp at the Kirkniemi mill changes. The mills older groundwood plant will be closed and the pulp needed will be obtained from M-reals chemi- thermo mechanical pulp mills. Closure of the groundwood plant will not only lead to redundancies in the production personnel but will also reduce the need for maintenance staff. The mills old groundwood plant is at the end of its technical duty life and modernizing it would call for substantial capital expenditures. The groundwood plant has high operating costs and its environmental impact is considerable compared with the use of chemi- thermo mechanical pulp. It is estimated that operations at the groundwood plant will be wound up in September 2005. Maintenance at the mill will also be stepped up by means of a new operational model that will reduce the repair need and fault level thanks to the established policy of preventive maintenance. Tasks will be scheduled for efficient use of available resources through the use of a systematic approach that is made possible by modern Enterprise Resource Planning (ERP) systems. The adoption of the new operational model starts at the beginning of 2004. M-REAL CORPORATION Jouko M. Jaakkola President and CEO For additional information, contact Mill Manager Juhani Pöhö, tel. +358 10 464 2475, GSM +358 50 598 7607