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M-real’s result will weaken clearly in the 4Q 2011 and statutory negotiations to prepare for low delivery volumes will be started in Finland

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M-real Corporation Stock Exchange Release 8 December 2011 at 15.00 EET

M-real Corporation, a part of Metsäliitto Group, expected in connection to the 3Q 2011 result announcement that its operating result, excluding non-recurring items, will in the 4Q 2011 be roughly at the 3Q 2011 level. The 3Q 2011 operating result, excluding non-recurring items, was EUR 6 million.

The delivery volumes of pulp and paper have however been lower than expected and the pulp price has decreased more than anticipated. Also the board delivery volumes have been somewhat lower than expected as a result of rapid inventory reduction in different parts of the delivery chain. Due to these facts the 4Q 2011 operating result, excluding non-recurring items, will be clearly weaker than in 3Q 2011.

M-real starts statutory negotiations concerning all mills in Finland with the target to adapt the production temporarily for low volumes by temporary layoffs and working time arrangements. This is an anticipatory measure if no material improvement in the order volumes experienced in late 2011 emerges. Possible actions will be decided locally at the mills. All in all, the negotiations concern approximately 1.200 people.

 “End demand of board seems to be at normal level and the reduced board deliveries seem to be a result of continuing inventory reduction in different parts of the delivery chain. Long-term demand and profitability outlook for board continues good, but M-real will in short-term prepare for low delivery volumes by enabling temporary layoffs at the Finnish mills. Finalization of the earlier announced measures to eliminate losses of Alizay mill, Speciality Papers and the coated paper business, expected in early 2012 the latest, will improve M-real’s results materially”, says  CEO Mikko Helander.

M-real will publish the financial results for 2011 on 9 February 2012.

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

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