Stora Enso Oyj
NYSE : SEO

Stora Enso Oyj

October 26, 2006 06:53 ET

Stora Enso Interim Review January-September 2006

Cash flow stronger and operating profit excluding non-recurring items maintained compared with second quarter Stora Enso Oyj News Release October 26, 2006 at 10:00 GMT

HELSINKI, FINLAND--(CCNMatthews - October 26, 2006) -

Stora Enso (NYSE: SEO) today announced that its sales in the third quarter were similar to the second quarter. Increases in operating profit in Packaging Boards and Wood Products, excluding non-recurring items, more than offset the decrease in Fine Paper. However, the results were negatively impacted by net non-recurring items of EUR -177.2 million primarily related to closure and divestment decisions, as already announced.

Summary of Third Quarter Results (compared with Q2/2006)

- Sales were EUR 3 638.1 (EUR 3 616.3) million.

- Operating profit was EUR 195.2 (EUR 182.2) million excluding non-recurring items. Operating profit was EUR 18.0 (EUR 188.9) million including non-recurring items.

- Profit before tax was EUR 197.0 (EUR 53.2) million excluding non-recurring items; the difference is due mainly to unrealised fair valuation items (non-cash) in net financial items (positive EUR 50.1 million in the third quarter vs. negative EUR 71.9 million in the second quarter).

- Earnings per share were EUR 0.18 (EUR 0.05) excluding non-recurring items. Cash earnings per share were EUR 0.52 (EUR 0.39) excluding non-recurring items. Earnings per share including non-recurring items were EUR 0.07 (EUR 0.05).

- Cash flow after investing activities increased to EUR 473.8 (EUR 299.6) million.

Markets

In Europe market demand overall for the Group's products was slightly higher than a year ago and the previous quarter, driven by sustained economic growth and rising advertising and direct marketing expenditure.

In Europe market demand for newsprint grew moderately and was slightly better than a year ago. Demand for uncoated magazine paper was considerably stronger than a year ago, whereas demand for coated magazine paper was slightly weaker. Market demand was better than in the previous quarter in all magazine paper grades for seasonal reasons. Publication paper prices were higher than a year ago and similar to the previous quarter, except for a slight decline from the previous quarter in coated magazine paper.

Demand in the European coated fine paper market was stronger than in the previous quarter and weaker than a year ago. Demand for uncoated fine paper was slightly weaker than in the previous quarter, but stronger than a year ago. Prices increased slightly from the previous quarter in uncoated fine paper and were stable in coated fine paper. Market demand for packaging boards was good and better than in the previous quarter and a year ago. Prices remained stable.

Market demand for wood products in Europe and most export markets was better than in the previous quarter and a year ago, allowing some price increases. In North America the weakening housing market caused prices to fall.

In North America market demand for newsprint and magazine paper was weaker than a year ago, and newsprint demand was also weaker than in the previous quarter. However, the magazine paper market was seasonally stronger than in the previous quarter. Newsprint and uncoated magazine paper prices were higher than a year ago and the previous quarter. Coated magazine paper prices were lower than a year ago and the previous quarter. Market demand for coated fine paper was stronger than a year ago and the previous quarter; prices rose during the quarter.

In Latin America demand for coated magazine paper was better than in the previous quarter and a year ago. Prices have been mostly stable.

In Asia demand for coated fine paper was better than in the second quarter and a year ago, and prices were stable.

Stora Enso Deliveries and Inventories

Paper and board deliveries totalled 3 686 000 tonnes, which is 108 000 tonnes more than the previous quarter's 3 578 000 tonnes. Production increased by 56 000 tonnes from the previous quarter's 3 576 000 tonnes to 3 632 000 tonnes. Inventories decreased by 54 000 tonnes. Deliveries of wood products totalled 1 593 000 m3, which was 153 000 m3 less than the previous quarter's 1 746 000 m3. Wood product inventories remained unchanged. Market-related production curtailments in the third quarter totalled 93 000 tonnes, mostly in coated magazine paper.

Key Figures





EUR million 2004 2005 Q1-Q3/055) Q1-Q3/06 Q3/05 Q1/06 Q2/06 Q3/06
12 13 3 3 3 3
Sales 395.8 187.5 9 551.4 10 862.1 219.2 607.7 616.3 638.1
1 1
EBITDA1)2) 508.4 487.4 1 075.8 1 377.3 388.6 463.3 451.2 462.8
Operating
profit2)4) 426.7 357.5 236.6 571.5 106.2 194.1 182.2 195.2
Non-recurring
items
(operational) 369.7 -451.4 -12.0 -193.7 - -23.2 6.7 -177.2
Operating
margin2)4), % 3.4 2.7 2.5 5.3 3.3 5.4 5.0 5.4
Operating
profit4) 796.4 -93.9 224.6 377.8 106.2 170.9 188.9 18.0
Net financial
items6) -106.0 -151.6 -102.7 -42.4 -25.0 115.2 -149.2 -8.4
Profit before
tax and
minority
interests2)4) 359.6 273.1 176.7 461.1 93.0 210.9 53.2 197.0
Profit before
tax and
minority
interests4) 729.3 -178.3 164.7 397.4 93.0 317.7 59.9 19.8
Net profit
for the
period4) 747.8 -126.3 117.9 324.4 66.5 226.4 40.9 57.1

EPS2), Basic,
EUR 0.25 0.28 0.15 0.43 0.08 0.20 0.05 0.18
EPS, Basic,
EUR 0.89 -0.16 0.14 0.41 0.08 0.29 0.05 0.07
CEPS2)3), EUR 1.67 1.70 1.20 1.45 0.44 0.54 0.39 0.52
ROCE2), % 3.0 3.1 2.8 6.5 3.7 6.5 6.1 6.7

1) EBITDA = Earnings before Interest, Taxes, Depreciation and Amortisation

2) Excluding net non-recurring items. Exceptional transactions that are not
related to normal business operations are accounted for as non-recurring
items. The most common non-recurring items are capital gains, additional
write-downs, restructuring provisions and penalties. Non-recurring items
are normally specified individually if they exceed one cent per share.

3) CEPS = (Net profit for the period + depreciation and
amortisation)/average number of shares

4) The comparative figures exclude goodwill amortisation of EUR 90.3
million for 2004

5) The impact of the 7-week labour dispute in Finland in 2005 distorts
comparison of the year-on-year figures

6) See separate table Net Financial Items below


January-September 2006 Results (compared with the same period in 2005)

The impact of the 7-week labour dispute in Finland in 2005 distorts comparison of the year-on-year figures.

Sales at EUR 10 862.1 million were 13.7% higher than in the same period in 2005, mainly due to the impact of the Schneidersohne acquisition, increased prices, especially in newsprint, and increased deliveries in Fine Paper and Packaging Boards, partly offset by the divestment of Pankakoski, Celbi and Wolfsheck mills and the closure of two paper machines at Corbehem Mill.

Operating profit excluding non-recurring items increased by EUR 334.9 million to EUR 571.5 million and was higher in all segments, although the impact of the labour dispute in Finland in 2005 distorts the comparison. Operating profit including non-recurring items totalled EUR 377.8 (EUR 224.6) million. Non-recurring items for the nine months totalled EUR -193.7 (EUR -12.0) million.

Publication Paper operating profit improved mainly because higher sales prices, lower fixed costs and product mix changes more than offset increased energy costs and market-related production curtailments in coated magazine paper totalling 237 000 tonnes. The standstill at Port Hawkesbury Mill in Canada burdened operating profit by approximately EUR 45 million. The mill is gradually restarting production during the fourth quarter. Fine Paper operating profit was positively impacted by higher sales volume, and Merchant operating profit improved. Packaging Boards operating profit improved as higher sales volume and higher sales prices more than offset higher energy costs. Wood Products operating profit also improved as higher sales prices and improved cost efficiency more than offset higher raw material costs.

Profit before taxes and minority interests excluding non-recurring items increased by EUR 284.4 million to EUR 461.1 million, and earnings per share excluding non-recurring items increased by EUR 0.28 to EUR 0.43. Earnings per share including non-recurring items were EUR 0.41(EUR 0.14).

Third Quarter Results (compared with Q2/2006)

Sales at EUR 3 638.1 million were similar to the previous quarter's EUR 3 616.3 million. Deliveries of paper and board products increased, but deliveries of wood products decreased by 8.8% for seasonal reasons. The divestment of Pankakoski, Celbi and Wolfsheck mills reduced sales by approximately EUR 60 million. The acquisition of Arapoti Mill in Brazil, effective from 1 September 2006, increased the Group's sales by EUR 13.0 million. These assets were formerly owned by Inpacel - Industria de Papel Arapoti Ltda. and Inpacel Agroflorestal Ltda., subsidiaries of International Paper.

Operating profit excluding non-recurring items increased by 7.1% to EUR 195.2 (EUR 182.2) million, which is 5.4% of sales. Operating profit increased in Packaging Boards and Wood Products, remained unchanged in Publication Paper and decreased in Fine Paper. Publication Paper operating profit remained unchanged mainly due to the problematic situation at Corbehem Mill in France as a consequence of machine closures and the standstill at Port Hawkesbury Mill in Canada, which continued to burden the operating profit by approximately EUR 15 million. Fine Paper operating profit decreased partly due to the divestment of Celbi Pulp Mill and higher
maintenance costs. Packaging Boards operating profit rose as the sales volume increased and fixed costs decreased. Wood Products operating profit was increased by cost savings and higher sales prices, partly offset by higher raw material costs.

Operating profit includes a negative non-cash effect of EUR 4.6 million comprising the fair valuation of share-based compensation (EUR -12.1 million) and the released government grant related to CO2 emission rights (EUR 7.5 million). Both these non-cash items are reported under other operations.

There were several non-recurring items with a net impact of EUR -177.2 million on operating profit:

- a capital gain of EUR 186.0 million, including an additional dividend, on the divestment of Celbi Pulp Mill in Portugal, which was finalised on 8 August;

- impairment and restructuring provisions of EUR 47.0 million on the divestment of Wolfsheck Mill in Germany, which was finalised on 1 September;

- an additional restructuring provision of EUR 7.0 million related to the social plans at Corbehem Mill in France and previously announced machine closures;

- impairments of EUR 21.0 million and restructuring provisions of EUR 3.0 million related to Stora Enso Timber's fixed asset impairments in Germany and Estonia, and to restructuring of Stora Enso Timber's sales network;

- a provision of CAD 20.0 million (EUR 14.2 million) related to post-employment benefits at Port Hawkesbury Mill in Canada as a result of the new labour agreement and decision to restart the mill;

- provisions and write-downs of EUR 271.0 million related to the planned closures of Berghuizer and Reisholz mills.

The total cash impact of the above items is EUR -4.5 million; the cash impact will be realised as the actions occur.

The share of associated company results amounted to EUR 10.2 (EUR 20.2) million; the main contribution was from Bergvik Skog AB.

Net Financial Items





EUR million Q3/2005 Q2/2006 Q3/2006
Interest income, deposits 6.1 5.0 5.2
Interest expenses, borrowings -68.4 -70.1 -70.4
Interest rate swaps (incl. TRS interest) 16.1 5.4 4.0
Capitalised interest 2.4 - 0.8
Net Interest Expense -43.8 -59.7 -60.4

Foreign Exchange Gains and Losses -3.7 -11.1 4.0

Other Financial Items, of which 22.5 -78.4 48.0
Capital gains, listed shares -3.8 - -2.1
Unrealised fair valuation of option hedges
(TRS) 29.5 -61.2 36.0
Unrealised fair valuation of other
financial items -1.9 -10.7 15.7
Other items -1.3 -6.5 -1.6

Net Financial Items Total -25.0 -149.2 -8.4


Stora Enso utilises Total Return Swaps (TRS) to partially hedge the exposure to changes in the share price of synthetic options granted under the option programmes for Management, which are settled with cash payments. While these TRS instruments allow the Group to partially stabilise the future cash flows related to the settlement of outstanding synthetic options, they expose the Group to certain market risks. The TRS instruments do not qualify for hedge accounting; therefore periodic changes to their fair value are recorded in the income statement.

Net financial items were EUR -8.4 (EUR -149.2) million, the difference being mainly due to the fair valuation of the hedges for the employee option programmes (Total Return Swaps, "TRS"). Net interest was EUR -60.4 (EUR -59.7) million and net foreign exchange gains on borrowings, currency derivatives and bank accounts were EUR 4.0 (EUR -11.1) million.

Other financial items rose to EUR 48.0 million from EUR -78.4 million due to EUR 51.7 (EUR -71.9) million of unrealised changes in fair values of financial instruments, including TRS. This unrealised fair value change is a non-cash item.

Profit before tax amounted to EUR 197.0 (EUR 53.2) million excluding non-recurring items.

Net taxes totalled a positive EUR 37.3 (EUR -19.0) million due to a tax-free gain from the Celbi Mill divestment, leaving a net profit for the quarter of EUR 57.1 (EUR 40.9) million. The cumulative tax rate for the first nine months was 26.7% excluding non-recurring items.

The profit attributable to minority shareholders was EUR 1.3 (EUR 2.3) million, leaving a profit of EUR 58.4 million attributable to Company shareholders.

Earnings per share were EUR 0.18 (EUR 0.05) excluding non-recurring items. Earnings per share including non-recurring items were EUR 0.07 (EUR 0.05). Cash earnings per share were EUR 0.52 (EUR 0.39) excluding non-recurring items.

The return on capital employed was 6.7% (6.1%) excluding non-recurring items. Capital employed was EUR 11 360.1 million on 30 September 2006, a net decrease of EUR 426.4 million. Operative working capital was EUR 238.9 million less than for the previous quarter as inventories decreased and short-term interest-free liabilities increased.

Capital Structure





EUR million 31 Dec 05 30 Sep 05 30 Jun 06 30 Sep 06
Fixed assets 11 616.8 11 621.1 11 200.6 10 956.2
Operative working capital 2 333.0 2 328.4 2 537.0 2 298.1
Non-current interest-free
items, net -571.9 -693.2 -657.0 -716.9
Operating Capital Total 13 377.9 13 256.3 13 080.6 12 537.4
Net tax liabilities -1 274.8 -1 516.5 -1 294.1 -1 177.3
Capital Employed 12 103.1 11 739.8 11 786.5 11 360.1
Associated companies 719.9 687.9 762.2 782.1
Total 12 823.0 12 427.7 12 548.7 12 142.2

Equity attributable to
Company shareholders 7 645.3 7 631.3 7 529.6 7 587.5
Minority interests 93.6 97.6 91.6 91.8
Net interest-bearing
liabilities 5 084.1 4 698.8 4 927.5 4 462.9
Financing Total 12 823.0 12 427.7 12 548.7 12 142.2


Financing

Cash flow from operations was EUR 602.5 (EUR 406.9) million and cash flow after investing activities EUR 473.8 (EUR 299.6) million.

At the end of the period, interest-bearing net liabilities were EUR 4 462.8 million, a decrease of EUR 464.7 million mainly because improved cash flow and the divestment of Celbi Pulp Mill more than offset the acquisition of Arapoti Mill in Brazil. Unutilised credit facilities and cash and cash-equivalent reserves totalled EUR 1.9 billion.

Shareholders' equity amounted to EUR 7 587.5 million or EUR 9.62 (EUR 9.55) per share, compared with the market capitalisation on the Helsinki Stock Exchange on 30 September 2006 of EUR 9.4 billion.

The debt/equity ratio at 30 September 2006 was 0.59 (0.65). The currency effect on equity was EUR -6.5 million net of the hedging of equity translation risks.

Cash Flow



EUR million 2005 Q3/05 Q2/06 Q3/06
Operating profit -93.9 106.2 188.9 18.0
Adjustments-) 1 439.4 299.1 249.6 223.2
Change in working capital -288.5 -55.4 -31.6 361.3
Cash Flow from Operations 1 057.0 349.9 406.9 602.5
Capital expenditure -1 145.3 -267.2 -107.3 -128.7
Cash Flow after Investing Activities -88.3 82.7 299.6 473.8

-) Adjustments include depreciations, other non-cash income and expenses
and capital gains and losses which are included in proceeds from the sale
of fixed assets and shares.


Capital Expenditure for January-September 2006

Capital expenditure for the first nine months of 2006 totalled EUR 403.7 million. The Group expects its capital expenditure for 2006 to be well below the previously communicated target of EUR 800 million, which is less than the scheduled depreciation for the year that is estimated at approximately EUR 1.1 billion.

The main projects during the first nine months were the Skoghall Energy 2005 project (EUR 25.8 million), the plantation project at Guangxi, China (EUR 25.1 million), the new boiler at Hylte Mill (EUR 23.1 million), the completion of the new paper machine 12 at Kvarnsveden Mill (EUR 17.0 million) and land acquisitions in Latin America (EUR 14.7 million).

Third Quarter Events

July

Stora Enso sold its Pankakoski Mill in Finland to an international group of investors led by Dr Dermot Smurfit and including Lansdowne Capital Limited. The debt-free sales price was EUR 20 million. The transaction was finalised on 31 July.

August

Stora Enso finalised the divestment of Celbi Pulp Mill in Portugal to the Portuguese company Altri. The sales price of Celbi's equity was approximately EUR 430 million and the company has no debt. The transaction was finalised on 8 August.

Stora Enso received the full payment for the sale of its Advance Agro shares. The ownership of the shares was transferred to private investors based in Hong Kong. The transaction value was USD 80 (EUR 65) million.

Stora Enso reached an agreement to acquire 100% of the shares in Vinson Industria de Papel Arapoti Ltda. and Vinson Empreendimentos Agricolas Ltda. from International Paper, which have been combined as Stora Enso Arapoti. These assets were formerly owned by Inpacel - Industria de Papel Arapoti Ltda. and Inpacel Agroflorestal Ltda., subsidiaries of International Paper. The deal comprised a paper mill producing coated mechanical paper, a sawmill and about 50 000 hectares of land, including about 30 000 hectares of productive plantations; the enterprise value was approximately USD 420 million (EUR 333 million) and the transaction was closed on 1 September.

Stora Enso announced that it will invest EUR 31.5 million in its
Nebolchi Sawmill and EUR 12.5 million in its Impilahti Sawmill in Russia. These investments will enhance the competitiveness of Stora Enso's sawmilling business and wood procurement in Russia.

Stora Enso divested its Wolfsheck Mill to Rohner AG of Switzerland, a subsidiary of the German finance investment company ARQUES Industries AG. The transaction was an asset deal and the purchase price was one euro. The transaction was closed on 1 September.

September

Stora Enso announced its decision to restart operations at the Port Hawkesbury Mill in Nova Scotia, Canada, following a ten-month shutdown due to profitability challenges. The SC paper machine (PM2) started operations in the beginning of October and the start-up of the newsprint machine (PM1) is scheduled for later this year.

Stora Enso signed a contract with Beihai city in Guangxi province, China, to secure further fibre resources. Under the contract, in the period 2006-2008 Beihai city will provide Stora Enso with a total of 30 813 hectares of plantation and land through purchasing existing plantations and establishing new plantations on forestland.

Events after the Period

On 4 October Stora Enso announced its intention to close down Reisholz Mill in Germany and Berghuizer Mill in the Netherlands. The planned closures are subject to local consultation. Summa Mill in Finland and Uetersen Mill in Germany will remain in operation while further improving their financial performance. These four mills had been under scrutiny since the announcement of Stora Enso's Asset Performance Review (APR) in October 2005.

On 26 October Stora Enso announced that it is initiating exclusive discussions with the aim of joint venture ownership regarding certain assets of Stora Enso Arapoti in Brazil with Arauco, a Chilean forest products company. Stora Enso Arapoti comprises a paper mill producing coated mechanical paper (205 000 tonnes annual capacity), a sawmill (150 000 m3 sawn timber annual capacity) and approximately 50 000 hectares of land including approximately 30 000 hectares of productive plantations. The potential joint ownership with Arauco is focused primarily on the sawmill and forestland operations. The non-binding joint ownership discussions are expected to be finalised prior to the end of January 2007.

On 26 October Stora Enso announced three separate investments in Finland and Austria. In Finland, the Group is investing EUR 32.4 million in rebuilding the finishing department at its Anjala Mill and EUR 25.3 million in a new sheeting line at its Oulu Mill. In Austria, Stora Enso is investing EUR 16.8 million in a cross-laminated element plant at Bad St. Leonhard Sawmill.

Changes in the Group Management

On 17 October Stora Enso announced that the Board of Directors had appointed Jouko Karvinen, M.Sc. (Eng.), as the new CEO of Stora Enso. He will join the company on 1 January 2007 and will take up the position of CEO following the Annual General Meeting (AGM) on 29 March 2007. Mr Karvinen is currently Chief Executive Officer of Philips Medical Systems Division and a member of the Board of Management of Royal Philips Electronics.

Jukka Harmala will leave the position of CEO following the AGM on 29 March 2007. He will continue to undertake special assignments specified by the Board of Directors of Stora Enso until the end of August 2007.

Inspections by Competition Authorities

In May 2004 Stora Enso was the subject of inspections carried out by the European Commission and the Finnish Competition Authority at locations in Europe and received subpoenas issued by the US Department of Justice as part of preliminary anti-trust investigations into the paper industry in Europe and the USA. Coincident with these investigations, Stora Enso has been named in a number of class action lawsuits filed in the USA.

Following the 2004 inspections, on 5 April 2006 Stora Enso received from the Finnish Competition Authority a request for a response concerning alleged price collaboration and exchange of information between forest companies in connection with the purchasing of timber in Finland from 1997 to 2004. Stora Enso has investigated the matter and gave its response by 22 June 2006 as requested.

On 9 August 2006 Stora Enso was notified that the European Commission had closed its investigation in respect of the fine paper sector. Investigations related to publication paper are still ongoing.

No provision has been made in Stora Enso's accounts for the above-mentioned investigations and lawsuits.

Share Capital

The Annual General Meeting (AGM) of Stora Enso Oyj on 21 March 2006 authorised the Board to repurchase and dispose of not more than 17 700 000 A shares and 60 100 000 R shares in the Company. There were no repurchases during the third quarter.

During the quarter a total of 1 000 A shares were converted into R shares. The latest conversion was recorded in the Finnish Trade Register on 15 August 2006.

During the quarter the Company allocated 1 769 repurchased R shares under the terms of the Stora Enso North America Option Plan.

On 30 September 2006 Stora Enso had 178 104 067 A shares and 611 434 432 R shares in issue, of which the Company held no A shares and 954 829 R shares with a nominal value of EUR 1.6 million. The holding represents 0.12% of the Company's share capital and 0.04% of the voting rights.

Profit 2007 and Asset Performance Review (APR) Programmes

Stora Enso's Profit 2007 profit improvement programme is proceeding ahead of schedule. The target of an improvement of EUR 300 million in annual pre-tax profit from mid 2007 onwards is expected to be clearly exceeded. More details will be given with the full year 2006 results on 7 February 2007. The APR programme, as it was announced in October 2005, is now completed, except for the planned closures of Reisholz and Berghuizer mills.

Near-term Outlook

In Europe economic recovery is expected to support newsprint and uncoated magazine paper markets in the seasonally strong fourth quarter by boosting advertising expenditure; newsprint and uncoated magazine paper prices are forecast to remain unchanged until the year end. However, the coated magazine paper business is expected to remain competitive, with market-related production curtailments continuing in the fourth quarter of 2006. The prospects for fine paper demand in the fourth quarter are healthy with stable prices in coated fine paper, and it is anticipated that price increases in uncoated fine paper will be finalised during the fourth quarter. The market for packaging boards is expected to be seasonally weaker than in the third quarter with stable prices. The outlook for wood products for the rest of the year is favourable in Europe.

In North America demand for newsprint is predicted to decline further. In coated magazine paper seasonal demand should improve the market in the latter part of the year. Demand for uncoated magazine paper remains stable. The coated fine paper market should stay healthy with stable prices. No material changes in publication paper and coated fine paper prices are anticipated in the fourth quarter.

Stora Enso's full year 2006 results will be published on February 7, 2007.

It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profitability; and statements preceded by "believes", "expects", "anticipates", "foresees", or similar expressions, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Since these statements are based on current plans, estimates and projections, they involve risks and uncertainties, which may cause actual results to materially differ from those expressed in such forward-looking statements. Such factors include, but are not limited to: (1) operating factors such as continued success of manufacturing activities and the achievement of efficiencies therein, continued success of product development, acceptance of new products or services by the Group's targeted customers, success of the existing and future collaboration arrangements, changes in business strategy or development plans or targets, changes in the degree of protection created by the Group's patents and other intellectual property rights, the availability of capital on acceptable terms; (2) industry conditions, such as strength of product demand, intensity of competition, prevailing and future global market prices for the Group's products and the pricing pressures thereto, price fluctuations in raw materials, financial condition of the customers and the competitors of the Group, the potential introduction of competing products and technologies by competitors; and (3) general economic conditions, such as rates of economic growth in the Group's principal geographic markets or fluctuations in exchange and interest rates.

The full-length version of the Stora Enso interim review is available on the Stora Enso website at http://www.storaenso.com/investors.

or from the following link:

http://www.storaenso.com/CDAvgn/main/0%2c%2c1_EN-1845-13744-%2c00.html

Stora Enso Interim Review January-September 2006 PDF:

http://hugin.info/3034/R/1083875/188463.pdf

Copyright c Hugin ASA 2006. All rights reserved.



Contact Information

  • Jukka Härmälä, CEO
    tel. +358 2046 21404
    Hannu Ryöppönen, CFO
    tel. +358 2046 21450
    or
    Keith B Russell, SVP, Investor Relations
    tel. +44 7775 788 659
    Tim Laatsch, Senior Vice President, Communications
    Stora Enso North America