UPM is continuing the strong development of its label business by building a world-class self-adhesive label materials factory in Poland. The value of the investment is EUR 90 million. Construction of the factory will begin in the third quarter of this year, and production is scheduled for start-up in the final quarter of 2008. The new production and logistics centre will serve the growing eastern European markets and meet increasing demand for filmic label materials European-wide. "For UPM, this will be the first industrial operation in eastern Central Europe. Label business is one of UPM's core businesses, and a strategic growth area for the company. We have invested strongly in its development in recent years, and its sales and result have developed favourably. Today's announcement is a consistent step in the strategy," says Jussi Pesonen, President and CEO of UPM. The new factory will feature newest proprietary technology both in coating and finishing. It will supply a wide range of high-quality film and paper labelstock products with water-based acrylic and hot-melt adhesives. “This will secure us and UPM Raflatac's label printing customers in Europe a solid growth platform for many years to come. Our on-going global strategic development programme, which has necessitated building new, modern production facilities in North America, Asia and now in Europe, will be largely complete. Our aim is to become the leading supplier in Europe, where particularly films and eastern Europe are strong key growth drivers,” says Heikki Pikkarainen, President of UPM's Label Division. For further information please contact: Mr Heikki Pikkarainen, President, UPM, Label Division, mobile +358 40 760 5758 Mr Jan-Erik Forsström, Senior Vice President, Europe, UPM Raflatac, mobile +358 40 502 9412 UPM-Kymmene Corporation Pirkko Harrela Executive Vice President, Corporate Communications DISTRIBUTION Helsinki Exchanges New York Stock Exchange Main media www.upm-kymmene.com