Stora Enso to Cut 2,000 From Workforce

April 23, 2009 - Stora Enso said that it is planning to reorganize its operations with a focus on reducing annual costs by EUR 250 million — the majority of the reduction to be achieved during 2009 and the remainder by the end of 2010.

Up to 2,000 employees will be affected, mainly as a result of the leaner management structures, Stora Enso said.

“In the past two years Stora Enso has taken several proactive and even early steps to position the group for a strong future. From divestments that strengthened our balance sheet to difficult restructuring programs in operations and de-layering the organization, which together reduced our total fixed costs by 4 to 5 margin points in two years, we have had one consistent goal — to make the group stronger, faster reacting and more focused,” said CEO Jouko Karvinen.

“And yet — with the dramatic changes in our operating environment — this has been only the beginning of our journey,'' he added.

“Today we are also taking the next step to make Stora Enso a simpler, faster-reacting and more focused group. Key objectives of this plan are consolidating the organization and building stronger and more powerful businesses that can operationally and strategically react quickly in a rapidly changing environment. We aim to simplify decision-making, and move decisions clearly closer to the businesses serving our customers,” Karvinen said.

The Helsinki, Finland-based paper producer said the cost reductions are expected to come mainly by reducing top and middle management and by downscaling staff functions and country organizations by one-third.

In addition, group functions such as Wood Supply and Logistics will have a revised operational model and be brought closer to the business areas.

Stora Enso produces newsprint and book paper, magazine paper, fine paper, consumer board, industrial packaging and wood products. The group has 32,000 employees and 85 production facilities in more than 35 countries worldwide. The company's annual production capacity is 12.7 million tons of paper and board, 1.5 billion square meters of corrugated packaging and 6.9 million cubic meters of sawn wood products, including 3.2 million cubic meters of value-added products.

SOURCE: Stora Enso

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