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Stora Enso Interim Review January-September 2010

HELSINKI, Finland, Oct. 27, 2010 (GLOBE NEWSWIRE) -- STORA ENSO OYJ INTERIM REVIEW 27 October 2010 at 09.00 EET
/ Source: GlobeNewswire

HELSINKI, Finland, Oct. 27, 2010 (GLOBE NEWSWIRE) -- STORA ENSO OYJ INTERIM REVIEW 27 October 2010 at 09.00 EET

Stora Enso Interim Review January-September 2010

Profits nearly doubled year-on-year - another strong quarterly performance

* EUR 255 million quarterly operating profit excluding NRI and fair valuations, up year-on-year by EUR 124 million driven mainly by improved product mix, prices and volumes;

* Quarterly operating profit margin excluding NRI and fair valuations increased year-on-year to 10% (6%), ROCE excluding NRI and fair valuations 12% (7%);

* Quarterly EPS excluding NRI improved year-on-year to EUR 0.23 (0.12) and CEPS excluding NRI to EUR 0.40 (0.29);

* Quarterly cash flow from operations and cash position strong at EUR 304million and EUR 1 121 million respectively; Debt/equity ratio improved quarter-on-quarter to 0.43 (0.49), net debt reduced to EUR 2 445 million;

* Market outlook remains generally favourable, but pressure on variable costs, seasonal demand weakness in some products and maintenance stoppages are expected to decrease fourth quarter earnings quarter-on-quarter;

* Stora Enso is acquiring 51% of the Chinese packaging company Inpac International operating in China and India.

 Summary of Third Quarter Results --------------------------------------------------------------------- Q3/10 Q2/10 Q3/09 --------------------------------------------------------------------- Sales EUR 2 623.6 2 692.2 2 231.0 million --------------------------------------------------------------------- EBITDA excl. NRI and fair EUR 365.8 329.8 255.9 valuations million --------------------------------------------------------------------- Operating Profit excl. NRI EUR 255.0 212.9 131.5 and Fair Valuations million --------------------------------------------------------------------- Operating profit/loss (IFRS) EUR 276.9 215.6 -502.6 million --------------------------------------------------------------------- Profit before tax excl. NRI EUR 220.4 201.5 106.4 million --------------------------------------------------------------------- Profit/loss before tax EUR 225.8 193.0 -548.7 million --------------------------------------------------------------------- Net profit excl. NRI EUR 188.9 168.4 92.5 million --------------------------------------------------------------------- Net profit/loss EUR 194.3 159.9 -519.7 million --------------------------------------------------------------------- EPS excl. NRI EUR 0.23 0.22 0.12 --------------------------------------------------------------------- EPS EUR 0.25 0.20 -0.66 --------------------------------------------------------------------- CEPS excl. NRI EUR 0.40 0.38 0.29 --------------------------------------------------------------------- ROCE excl. NRI and fair % 12.4 10.5 6.6 valuations --------------------------------------------------------------------- 

Fair valuations include synthetic options net of realised and open hedges, CO2 emission rights, and valuations of biological assets related to forest assets in equity accounted investments.

NRI = Non-recurring items. These are exceptional transactions that are not related to normal business operations. The most common non-recurring items are capital gains, additional write-downs, provisions for planned restructuring and penalties. Non-recurring items are normally specified individually if they exceed one cent per share.

Near-term Outlook

In Europe and globally demand for newsprint is expected to be unchanged from a year ago. In Europe demand for coated magazine paper is forecast to be slightly stronger as demand for uncoated magazine paper slightly weaker than a year ago.

Demand for coated fine paper is predicted to be slightly stronger and demand for uncoated fine paper stronger than a year ago. Demand for consumer board is expected to be slightly stronger than a year ago but seasonally weaker than in the third quarter of 2010. Demand for industrial packaging is expected to be slightly stronger than a year ago. Demand for wood products is anticipated to be similar to a year ago but weaker than in the third quarter of 2010.

In Europe newsprint prices are forecast to be similar to the third quarter of 2010, whereas global newsprint prices are forecast to be slightly higher than in the third quarter of 2010. Prices for coated and uncoated magazine paper are expected to be slightly higher than in the previous quarter.

Fine paper prices are predicted to be slightly higher than in the third quarter of 2010. Consumer board prices are forecast to be similar to the previous quarter, whereas industrial packaging prices are forecast to be slightly higher. Prices for wood products are predicted to be lower than in the third quarter of 2010.

Maintenance stoppages and wood and RCP costs are expected to have a greater negative impact at Group level on the fourth quarter 2010 results than the third quarter 2010 results. Wood Products faces pressure on profitability due to weakening market conditions and high raw material costs.

The Group expects its cost inflation excluding internal actions to remain 2% for the full year 2010.

 For further information, please contact: Jouko Karvinen, CEO, tel. +358 2046 21410 Markus Rauramo, CFO, tel. +358 2046 21121 Ulla Paajanen-Sainio, Head of Investor Relations, tel. +358 2046 21242 Lauri Peltola, Head of Communications and Global Responsibility, tel. +358 2046 21380 

The full-length version of the Stora Enso interim review is available on the Stora Enso website at

Stora Enso's full year 2010 results will be published on 8 February 2011.

Stora Enso is a global paper, packaging and wood products company producing newsprint and book paper, magazine paper, fine paper, consumer board, industrial packaging and wood products. The Group is the world leader in forest industry sustainability. We offer our customers solutions based on renewable raw materials. Our products provide a climate-friendly alternative to many non-renewable materials, and have a smaller carbon footprint. Stora Enso is listed in the Dow Jones Sustainability Index and the FTSE4Good Index. Stora Enso employs some 27 000 people worldwide, and our sales in 2009 amounted to EUR 8.9 billion. Stora Enso shares are listed on NASDAQ OMX Helsinki (STEAV, STERV) and Stockholm (STE A, STE R). In addition, the shares are traded in the USA as ADRs (SEOAY) in the International OTCQX over-the-counter market.

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.