Kemira Group Interim Report for January-June 2008



Kemira Group
Stock exchange release
July 30, 2008 at 9.00 (CET+1)

Kemira Group Interim Report for April-June 2008
- Revenue in April-June 2008: EUR 741.5 million (Q2/2007: EUR 753.0
million)
- Operating profit excluding non-recurring items: EUR 37.2 million
(EUR 56.6 million)
- Operating profit: EUR 39.3 million (EUR 72.3 million)
- Earnings per share: EUR 0.15 (EUR 0.27)
- New strategy approved, Tikkurila will be spun-off

New Strategy Implementation and Structural Changes Under Way

Kemira's President and CEO Harri Kerminen:"The development of raw material prices and energy-related costs
continued to be very unfavorable for Kemira. The achieved sales price
increases did not fully compensate for the significantly higher
costs. We were able to increase sales prices by more than 3% during
the first half of the year versus 1-6/2007, but variable costs,
including raw material prices, energy and transportation costs etc.,
increased by almost 5% of sales. Also the continued weakening of the
US dollar eroded our profitability versus Q2 2007. We will take
decisive action to improve the profitability through price increases
and we have initiated a cost savings program with annual cost savings
target of more than EUR 50 million. These savings will be achieved by
streamlining the global functions, e.g. consolidation of production
sites, R&D facilities and logistics network, and will lead to a
headcount reduction."

In June, Kemira's Board of Directors made a strategic decision to
concentrate on water and fiber related businesses in the future.
Tikkurila, Kemira's Coatings business area, will be spun-off into a
public company. The listing of Tikkurila will increase transparency
of Kemira's businesses and will turn Kemira into a more focused
company. Kemira will organize its businesses into three customer
based segments with P/L responsibilities.  Water is the common
denominator for all these segments. The Paper segment will focus on
serving customer segments in the pulp and paper industry, while the
Water segment will concentrate on serving customer segments in
municipal and industrial water treatment. A new segment Oil and
Mining will further develop businesses in the growing application
areas of the oil, gas and mining industries where water treatment
chemicals are of great importance."I am confident that the new sharp strategy and large structural
changes will contribute to continuous growth of the long term
shareholder value. Kemira has attained an extensive product portfolio
and broad competence base in water treatment for different customer
segments. I believe that Kemira has good growth opportunities and the
prerequisites to succeed in the globally growing water treatment
business, despite the current challenges in raw material prices and
profitability in the Water business. The first priority of the new
management will be on reinforcing the balance sheet, generating
positive cash flow and improving profitability", concludes Kerminen.

Key Figures and Ratios

EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Revenue                    741.5    753.0  1,425.1  1,426.3   2,810.2
EBITDA                      71.7     89.9    139.3    172.5     316.9
EBITDA, %                    9.7     11.9      9.8     12.1      11.3
Operating profit,           37.2     56.6     64.4    104.7     174.6
excluding non-recurring
items
Operating profit            39.3     57.6     72.3    106.5     143.1
Operating profit,            5.0      7.5      4.5      7.3       6.2
excluding non-recurring
items, %
Operating profit, %          5.3      7.6      5.1      7.5       5.1
Financial income and       -13.9    -12.6    -25.1    -24.8     -51.9
expenses
Profit before tax           25.6     45.7     47.5     83.0      93.3
Profit before tax, %         3.5      6.1      3.3      5.8       3.3
Net profit                  18.9     33.3     34.9     60.6      67.5
EPS, EUR                    0.15     0.27     0.27     0.48      0.53
Capital employed*        2,041.3  1,975.5  2,041.3  1,975.5   2,035.8
ROCE, %*                     5.4     10.3      5.4     10.3       7.1
Cash flow after
investments, excluding
acquisitions               -52.8     -6.4    -61.8   -124.0     -82.5
Personnel at period-end   10,673   10,588   10,673   10,588    10,007

* 12-month rolling average

Financial Performance for April-June

Kemira Group's revenue for April-June 2008 totaled EUR 741.5 million
(Q2/2007: EUR 753.0 million). Demand was healthy in most areas and
organic growth in local currencies was 2%. Acquisitions contributed
around EUR 7 million to revenue growth, while divestments depressed
revenue by EUR 2 million. The currency effect had a 4%, or EUR 29
million negative impact on revenue.


Revenue, EUR million    4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Kemira Pulp&Paper          253.6    267.0    517.5    529.7   1,043.0
Kemira Water               187.6    173.2    367.1    331.1     686.4
Kemira Specialty           108.8    110.6    215.8    214.1     425.9
Kemira Coatings            205.7    188.7    350.9    324.5     625.2
Other, including           -14.2     13.5    -26.2     26.9      29.7
eliminations
Total                      741.5    753.0  1,425.1  1,426.3   2,810.2


The second quarter was challenging due to continued increases in raw
material and energy prices and transportation costs. Kemira Group's
operating profit, excluding non-recurring items, for the second
quarter decreased by 34% to EUR 37.2 million (EUR 56.6 million). As a
result, operating profit as a percentage of revenue, excluding
non-recurring items, fell from 7.5% to 5.0%. High raw material and
energy prices and transportation costs eroded profitability in all
business areas, but water treatment chemicals and paper chemicals
were most severely affected. Furthermore, Kemira Specialty's
performance was hampered by low sales prices of titanium dioxide.
Variable cost increase in April-June 2008 was EUR 34 million,
excluding effect of acquisitions, divestments and change in volumes,
compared to same period in 2007. Sales price increases and higher
volumes increased operating profit by EUR 26 million and EUR 2
million respectively. The currency effect decreased operating profit
by EUR 4 million.


Operating profit (excl.
non-recurring items),
EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Kemira Pulp&Paper           10.1     23.3     25.7     44.9      79.8
Kemira Water                 5.5     13.1     12.3     25.1      46.7
Kemira Specialty             1.6      7.1      5.4     17.4      24.1
Kemira Coatings             29.7     27.3     41.4     40.1      64.3
Other, including            -9.7    -14.2    -20.4    -22.8     -40.3
eliminations
Total                       37.2     56.6     64.4    104.7     174.6



Operating profit, EUR     Kemira     Kemira Kemira    Kemira   Kemira
million                    Group Pulp&Paper  Water Specialty Coatings
Bridge 4-6/2007 to
4-6/2008
Operating profit,             58         23     13         7       27
4-6/2007
Price                         26          8      7         2        9
Volume                         2         -3      4        -1        3
Currency                      -4          0     -1        -3        0
Variable Costs               -34        -11    -14        -4       -5
Other                         -9         -7     -3         1       -4
Operating profit,             39         10      6         2       30
4-6/2008


Operating profit for April-June came to EUR 39.3 million (57.6) and
includes non-recurring items with a positive net impact of
EUR 2.1 million (EUR 1.0 million).

Profit before tax for the second quarter amounted to EUR 25.6 million
(45.7) and net profit totaled EUR 18.9 million (33.3). Earnings per
share were EUR 0.15 (EUR 0.27).
Financial Performance for January-June

Kemira Group's revenue for January-June 2008 totaled EUR 1,425.1
million (January-June 2007: EUR 1,426.3 million). Organic growth in
local currencies was 2% for the first half of the year. Acquisitions
contributed around EUR 23 million to revenue growth, while
divestments depressed revenue by EUR 8 million. The currency effect
had a -3%, or around EUR -48 million impact on revenue.

Operating profit, excluding non-recurring items, for January-June
2008 decreased by 38% to EUR 64.4 million (EUR 104.7 million). The
decrease in operating profit was due to the significant increases in
raw material and energy-related costs that have continued during the
first half of the year.

Operating profit for January-June came to EUR 72.3 million (106.5)
and includes non-recurring items with a positive net impact of
EUR 7.9 million (EUR 1.8 million).

Profit before tax for the first half of the year amounted to EUR 47.5
million (83.0) and net profit totaled EUR 34.9 million (60.6).
Earnings per share were EUR 0.27 (EUR 0.48).


Financial Position and Cash Flows

In January-June, the Group reported cash flows of EUR 14.6 million
(23.1) from operating activities. Net cash flow from investing
activities was EUR -80.3 million (-191.7) of which acquisitions
accounted for an outflow of EUR 3.9 million (44.6). Kemira improved
its free cash flow to EUR -65.7 million (-168.6). Cash flow effect
from expansion and improvement investments was EUR -67.8 million
(-86.6).

At the end of June, the Group's net debt stood at EUR 1,113.5 million
(December 31, 2007: EUR 1,003.4 million). Kemira Oyj paid EUR 60.6
million in dividends in April.

At the period-end, interest-bearing liabilities stood at EUR 1,167.7
million. Fixed-rate loans accounted for 27.7% of total
interest-bearing net loans. The average interest rate on the Group's
interest-bearing liabilities was 5.2%. The duration of the Group's
interest-bearing loan portfolio on June 30 was 13 months (December
31, 2007: 13 months).

The unused amount of the EUR 750 million revolving credit facility,
that falls due in 2012, was EUR 542.4 million on June 30.

On June 30, the equity ratio stood at 37 % (December 31, 2007: 39%),
while gearing was 99% (December 31, 2007: 92%). Available-for-sale
financial assets include also shares entitling to electricity from a
nuclear power plant currently under construction in Finland. In
previous financial statements these shares have been accounted at
acquisition value. In May 2008, the market price of these nuclear
power plant shares was determined by an external third party share
trading transaction. Due to this, the Group has booked a revaluation
of the shares, EUR 80 million, with an equity effect of EUR 59.2
million.

The Group's net financial expenses for January-June totaled EUR 25.1
million (24.8).

Capital Expenditure
Gross capital expenditure, excluding acquisitions, amounted to EUR
87.5 million (121.1) in January-June. Expansion investments
represented around 45% of capital expenditure, excluding
acquisitions, improvement investments around 32% and maintenance
investments around 23%.

Group depreciation came to EUR 67.0 million (66.0 million).

Cash flow from the sale of assets was EUR 11.1 million (-26.0). Cash
flow from acquisitions was EUR -3.9 million (-44.6). The Group's net
capital expenditure totaled EUR 80.3 million (191.7).

Research and Development
In January-June, reported research and development expenditure
totaled EUR 30.9 million (EUR 33.1 million), accounting for 2% of
revenue (2%).

In June Kemira Oyj and the European Investment Bank (EIB) signed a
EUR 100 million 12-year research and development loan agreement. Loan
can be raised within 18 months of signing. The European Investment
Bank has evaluated and granted the loan to support the research,
development and innovation activities of the Kemira Group during the
years 2008-2011. This facility is intended for financing research anddevelopment expenditure in the group's core business areas and
promoting development projects in the group's competence centers.

Human Resources
The number of Group employees totaled 10,673 on June 30 (10,588).

Business Areas

Kemira Pulp&Paper
Kemira Pulp&Paper is the world's leading expert in pulp and paper
chemicals, its energy and cost-efficient solutions spanning the pulp
and paper industry's value chain from pulp to paper coating.


EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Revenue                    253.6    267.0    517.5    529.7   1 043.0
EBITDA                      21.0     34.9     48.5     70.4     133.7
EBITDA, %                    8.3     13.1      9.4     13.3      12.8
Operating profit,           10.1     23.3     25.7     44.9      79.8
excluding non-recurring
items
Operating profit            10.1     23.3     25.7     46.2      68.2
Operating profit,            4.0      8.7      5.0      8.5       7.6
excluding non-recurring
items, %
Operating profit, %          4.0      8.7      5.0      8.7       6.5
Capital employed*          824.2    839.8    824.2    839.8     833.6
ROCE, %                      5.8     10.7      5.8     10.7       8.2
Capital expenditure,
excluding acquisitions      13.6     21.0     24.9     43.3      78.4
Cash flow after
investments, excluding
acquisitions                 2.2    -11.2     31.3    -18.9     -24.3
Personnel at period-end    2,446    2,485    2,446    2,485     2,351

* 12-month rolling average


Kemira Pulp&Paper's revenue in April-June 2008 decreased by 5% to EUR
253.6 million (267.0). The currency effect had a 5% negative effect
on revenue. While pulp chemicals showed high demand, the competitive
environment for paper chemicals was challenging, due to customer
paper mill closures, in Europe and North America. Organic growth in
local currencies was 1%.

As a result of higher raw material and energy-related prices and
lower volumes operating profit for the second quarter was down by 57%
from the previous year to EUR 10.1 million (23.3). These raw material
price hikes impacted particularly strongly on the profitability of
the paper chemicals business. Variable cost increase in April-June
2008 was EUR 11 million compared to same period in 2007. Sales price
increases had a EUR 8 million effect on operating profit. Lower
volumes decreased operating profit by EUR 3 million.

In January-June 2008, Kemira Pulp&Paper's revenue decreased by 2% to
EUR 517.5 million (529.7). Organic growth in local currencies was 3%.
The currency effect had a 4% negative effect on revenue.

Operating profit, excluding non-recurring items, in January-June 2008
was EUR 25.7 million (44.9). The decrease in profitability was mainly
due to continuously increasing raw material and energy-related costs.
Achieved sales price increases did not fully compensate the effect of
high raw material prices and energy-related costs.

In June, the European Commission imposed a fine of EUR 10.15 million
on Finnish Chemicals Oy for antitrust activity in the company's
sodium chlorate business during 1994-2000. Kemira Oyj acquired
Finnish Chemicals in 2005. The company will look into the
Commission's decision and then decide on any further action. The fine
imposed by the Commission will not have any significant effect on
Kemira's cash flow or result.

Kemira Water
Kemira Water is the world's leading expert in municipal and
industrial waste water as well as process and drinking water
treatment. Kemira Water offers services, products and equipment for
municipal and industrial water treatment.


EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Revenue                    187.6    173.2    367.1    331.1     686.4
EBITDA                      12.9     20.0     29.7     38.8      78.8
EBITDA, %                    6.9     11.5      8.1     11.7      11.5
Operating profit,            5.5     13.1     12.3     25.1      46.7
excluding non-recurring
items
Operating profit             5.5     13.1     14.7     25.1      43.6
Operating profit,            2.9      7.6      3.4      7.6       6.8
excluding non-recurring
items, %
Operating profit, %          2.9      7.6      4.0      7.6       6.4
Capital employed*          417.2    341.2    417.2    341.2     409.4
ROCE, %                      8.1     13.4      8.1     13.4      10.9
Capital expenditure,
excluding acquisitions       8.2     11.0     17.3     18.7      51.0
Cash flow after
investments, excluding
acquisitions                -6.8     16.3     -3.8      5.8     -11.6
Personnel at period-end    2,324    2,150    2,324    2,150     2,319

* 12-month rolling average


Kemira Water's revenue in April-June 2008 increased by 8% to EUR
187.6 million (173.2). Sales were high in all areas and organic
growth in local currencies was 10%. The currency effect had a 6%
negative impact on revenue. Acquisitions contributed around EUR 7
million to revenue growth.

Raw material prices and transportation costs continued to increase
dramatically during the second quarter and had an impact on
profitability, despite realized sales price increases. Operating
profit was EUR 5.5 million (13.1). Variable cost increase in
April-June 2008 was EUR 14 million compared to same period in 2007.
Sales price increases and higher volumes increased operating profit
by EUR 7 million and EUR 4 million respectively. The currency effect
decreased operating profit by EUR 1 million. The increase in raw
material and transportation costs had an impact on the profitability
of both water treatment polymers and coagulants.

In January-June 2008 Kemira Water's revenue increased 11% to EUR
367.1 million (331.1). Organic growth in local currencies was 11% in
the first half of the year. The currency effect had a 5% negative
impact on revenue. Acquisitions contributed around EUR 16 million to
revenue growth.

Due to unfavorable developments in raw material prices, operating
profit excluding non-recurring items decreased by 51% in January-June
2008 compared to the same period last year. Operating profit
excluding non-recurring items was EUR 12.3 million (25.1).

Kemira Specialty
Kemira Specialty is the leading expert in specialty chemicals in
selected customer segments, serving customers in a wide array of
industries, such as the paint, cosmetics, printing ink, food and feed
industries, through its customer-driven solutions.


EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Revenue                    108.8    110.6    215.8    214.1     425.9
EBITDA                       9.4     14.9     21.3     33.0      45.1
EBITDA, %                    8.6     13.5      9.9     15.4      10.6
Operating profit,            1.6      7.1      5.4     17.4      24.1
excluding non-recurring
items
Operating profit             1.6      7.1      5.4     17.4      13.5
Operating profit,            1.5      6.4      2.5      8.1       5.7
excluding non-recurring
items, %
Operating profit, %          1.5      6.4      2.5      8.1       3.2
Capital employed*          426.9    443.8    426.9    443.8     435.3
ROCE, %                      0.4      9.1      0.4      9.1       3.1
Capital expenditure,
excluding acquisitions      12.0     15.1     18.7     24.6      55.0
Cash flow after
investments, excluding
acquisitions               -13.0    -16.8    -10.2    -24.4     -19.7
Personnel at period-end    1,080    1,182    1,080    1,182     1,028

* 12-month rolling average


Kemira Specialty's revenue in the second quarter decreased by 2% to
EUR 108.8 million (110.6). Sales were depressed by the ongoing
weakening of the US dollar and by the market environment for titanium
dioxide, which continues to be very challenging. Titanium dioxide
sales prices remained low. The currency effect had a 4% negative
impact on revenue. Organic growth in local currencies was 2%.

Operating profit in the second quarter amounted to EUR 1.6 million
(7.1). The decline from the previous year could be attributed to the
weaker US dollar and increases in raw material and energy prices. The
weakening of the US dollar has continued to improve the competitive
position of US titanium dioxide producers in Europe, which is making
it increasingly difficult to raise sales prices in Europe. Demand
for, and the price level of, formic acid remained at a good level.
Variable cost increase in April-June 2008 was EUR 4 million compared
to same period in 2007. Sales price increases had a EUR 2 million
effect on operating profit. Lower volumes and the currency effect
decreased operating profit by EUR 1 million and EUR 3 million
respectively.

Revenue in January-June 2008 was EUR 215.8 million (214.1). Organic
growth for the period in local currencies was 2%.The currency effect
had a 3% negative impact on revenue.

Operating profit in January-June amounted to EUR 5.4 million (17.4).

In May, Kemira announced that Kemira Oyj and Rockwood Holdings Inc.
have agreed to form a joint venture that includes both parties'
titanium dioxide businesses and the functional additives business
owned by Rockwood. The new joint venture will include Rockwood's
titanium dioxide pigments and functional additives businesses,
including its production facilities in Duisburg, Germany and Kemira's
titanium dioxide business, including Kemira's titanium dioxide plant
in Pori and Kemira's technical research center specializing in TiO2
products in Oberhausen, Germany and its US subsidiary, Kemira
Specialty, Inc. The new specialty titanium dioxide company will be
headquartered in Germany and had a pro forma turnover of
approximately EUR 560 million in 2007. With a yearly production
capacity of around 240 000 tons of titanium dioxide, the company will
have around 1 700 employees. Rockwood will own 61% and Kemira 39% of
the new joint venture. An excellent way of developing the value of
Kemira's titanium dioxide business, the venture will provide a good
platform for synergy creation e.g. through better capacity
utilization. The new company will be a highly specialized titanium
dioxide producer with strong market positions in global niche market
segments. It will be the leading provider of titanium dioxide
pigments for textile, packaging ink and cosmetics industries
worldwide. The deal is subject to approval by the competition
authorities and is expected to close during Q3 in 2008.

The expansion of Kemira's formic acid plant in Oulu, Finland, was
completed and taken in use in July. The expansion enables Kemira's
total production capacity to be increased by 30 percent to over
100,000 t/a. Kemira is the second largest producer of formic acid.
This investment will further strengthen Kemira's position on the
market and meet the market needs.

Kemira Coatings
Kemira Coatings is the leading expert in painting and coating
solutions in Northern and Eastern Europe, providing services and
branded products to consumers, professionals and the industry.


EUR million             4-6/2008 4-6/2007 1-6/2008 1-6/2007 1-12/2007
Revenue                    205.7    188.7    350.9    324.5     625.2
EBITDA                      34.5     31.4     50.9     48.5      91.2
EBITDA, %                   16.8     16.6     14.5     14.9      14.6
Operating profit,           29.7     27.3     41.4     40.1      64.3
excluding non-recurring
items
Operating profit            29.7     27.3     41.4     40.1      73.1
Operating profit,           14.4     14.5     11.8     12.4      10.3
excluding non-recurring
items, %
Operating profit, %         14.4     14.5     11.8     12.4      11.7
Capital employed*          320.3    306.1    320.3    306.1     311.0
ROCE, %                     23.3     25.9     23.3     25.9      23.9
Capital expenditure,
excluding acquisitions       7.9     12.4     14.0     22.2      43.5
Cash flow after
investments, excluding
acquisitions                -1.5     15.8    -17.7    -23.9      26.0
Personnel at period-end    4,303    4,218    4,303    4,218     3,789

* 12-month rolling average


Kemira Coating's revenue in the second quarter rose by 9% to EUR
205.7 million (188.7), this growth being organic. Sales development
was high in most markets both in decorative paints and industrial
coatings. The slowdown in new construction and the decrease in sales
of construction material in the Baltic affected the growth of Kemira
Coatings in that region.

Operating profit in the second quarter amounted to EUR 29.7 million
(27.3), an increase of 9%. Variable cost increase in April-June 2008
was EUR 5 million compared to same period in 2007. Sales price
increases and product mix had a EUR 9 million effect on operating
profit. Higher volumes increased operating profit by EUR 3 million.

In January-June 2008 revenue rose by 8% to EUR 350.9 million (324.5).
Organic growth in local currencies for the first half of the year was
8%.

Operating profit in January-June 2008 was EUR 41.4 million (40.1).
Increases in the costs of some raw materials and packaging materials
had an effect on profitability.

Following its strategy of growth, Kemira Coatings (Tikkurila), will
strengthen its position in the Southeast European paint market and
has agreed to establish a trading company by the name of Tikkurila
JUB Romania with the paint company JUB of Slovenia. This new company
will be responsible for the marketing, sales and distribution of
Tikkurila's and JUB's decorative paints in Romania.

Kemira Coatings (Tikkurila) has also decided on a relocation and
major expansion in production of decorative paints in St Petersburg,
Russia. The expansion will significantly increase Tikkurila's
production volumes of waterborne paints and improve the cost
efficiency of production in Russia. The demand for waterborne
products is steadily increasing in Russia.

Kemira Oyj Shares and Shareholders
During January-June, Kemira Oyj shares registered a high of EUR 14.77
and a low of EUR 7.88, the share price averaging EUR 9.47. On June
30, the company's market capitalization, excluding treasury shares,
totaled EUR 971.9 million.

On June 30, 2008, the company's share capital totaled EUR 221.8
million and the number of registered shares was 125,045,000. Kemira
holds 3,854,465 treasury shares, accounting for 3.1% of outstanding
company shares and voting rights.

Strategy Update
In June Kemira announced its new strategy. Kemira's Board of
Directors made a strategic decision to concentrate on water and fiber
related businesses in the future. Kemira will initiate a spin-off
process to turn Tikkurila, its Coatings business area, into a public
company owned by Kemira's current shareholders and potential new
shareholders on the Helsinki Stock Exchange. This will take place
during the first half of 2009. Kemira will remain a shareholder in
the Coatings company, widely known as Tikkurila, in order to retain
the value upside in Tikkurila's shares. Kemira has engaged a
financial advisor in the listing process. In addition Kemira has
decided to reorganize its Kemira Specialty business area by forming a
joint venture together with Rockwood Holdings Inc. in the titanium
dioxide and continue to develop the ChemSolutions business as a
separate entity. Chemidet, which is part of hydrogen peroxide chain,
will be part of pulp customer segment.

According to the strategy Kemira will first concentrate on
reinforcing the balance sheet, generating positive cash flow and
improving profitability. During the second phase Kemira will seek
strong organic growth.

Kemira will organize its businesses in accordance with the new
strategy into three customer based segments with P/L
responsibilities.  Water is the common denominator for all of these
segments. The Paper segment will focus on serving customer segments
in the pulp and paper industry, while the Water segment will
concentrate on serving customer segments in municipal and industrial
water treatment. A new segment Oil and Mining will further develop
businesses in the growing application areas of the oil, gas and
mining industries where water treatment chemicals are of great
importance.

The new integrated and lean organization will be effective from the
beginning of October 2008.

Together with the announcement of the new strategy Kemira announced a
cost savings program with annual savings target of over EUR 50
million, excluding Kemira Coatings. The planned savings program may
also lead to a reduction of approximately 1000 persons worldwide from
Kemira's payroll, including potential sale of businesses.
Streamlining of the global functions may lead to for example to the
consolidation of production sites, the R&D facilities and the
warehouse network. A cost savings program will be prepared taking
into account of all local requirements before any decisions are made.
Further briefings on these decisions will be given during Q3.

Outlook
Kemira Group's growth is expected to be moderate and primarily fueled
by organic growth in 2008. Continued actions taken on price increases
and ongoing improvements in operational efficiency, including cost
savings, are the key to improving profitability. Due to the
unfavorable development of raw material prices and energy-related
costs together with a weak US dollar, Kemira's operating profit and
earnings per share, excluding non-recurring items, are expected to
remain below last year's level.

The operational rearrangements carried out in Kemira Pulp&Paper's
customer industries in North America and Europe may have an adverse
impact on Kemira's pulp and paper chemicals business. Kemira Water is
expected to show good organic growth, but otherwise the forecast for
Kemira Water's business is overshadowed by the significant increase
in raw material prices. In the Kemira Specialty business area, demand
for titanium dioxide, organic acids and sodium percarbonate is
expected to be reasonable. Kemira Coatings expects sustained healthy
demand in most market areas, with the strongest growth anticipated in
Russia and CIS.


Helsinki, July 30, 2008

Board of Directors

All forward-looking statements in this review are based on the
management's current expectations and beliefs about future events,
and actual results may differ materially from the expectations and
beliefs such statements contain.


For further information, please contact:

Kemira Oyj
Timo Leppä, Executive Vice President, Group Communications
Tel. +358 10 862 1700

Kemira Oyj
Andreas Langhoff, Investor Relations Manager
Tel. +358 10 862 1140

Kemira will hold a press conference on its January-June 2008 results
for the media and analysts at its head office (Porkkalankatu 3)
today, starting at 10:30 a.m.
Presentation material will be available on Kemira's website at
http://www.kemira.com/en/investors/financialinformation/interimreports/




KEMIRA GROUP

The figures are unaudited.
All figures in this financial report have been rounded and
consequently the
sum of individual figures can deviate from the presented sum
figure.

This Interim Consolidated Financial Statements has been prepared in
compliance
with IAS 34.

Changes to the accounting policies as of
January 1, 2008:
- IFRIC 11 interpretation of IFRS 2 Group and
Treasury Share Transactions
- IFRIC 12 (Service Concession Arrangements)
interpretation related to service
arrangements between public and
private sectors
- IFRIC 14 (IAS 19 - The Limit on a defined
Benefit Asset, Minimum Funding Requirement
and their Interaction) interpretation related
to minimun funding requirements of defined
benefit arrangements
The Group assesses that the adoption of the
revised standards will not have any material
effect on its future financial statements.


INCOME STATEMENT               4-6/      4-6/      1-6/        1-6/
EUR million                    2008      2007      2008        2007       2007

Revenue                       741.5     753.0   1,425.1     1,426.3    2,810.2
Other operating
income                          7.6       5.9      21.3        12.7       45.9
Expenses                     -677.4    -669.1  -1,307.1    -1,266.5   -2,539.2
Depreciation and
impairments                   -32.4     -32.3     -67.0       -66.0     -173.8
Operating profit               39.3      57.6      72.3       106.5      143.1
Financial income and
expenses, net                 -13.9     -12.6     -25.1       -24.8      -51.9
Share of profit or loss of
associates                      0.2       0.7       0.3         1.3        2.1
Profit before tax              25.6      45.7      47.5        83.0       93.3
Income tax                     -6.7     -12.4     -12.6       -22.4      -25.8
Net profit for the period      18.9      33.3      34.9        60.6       67.5

Attributable to:
Equity holders of the
parent                         17.6      32.3      32.4        58.7       63.7
Minority interest               1.3       1.0       2.5         1.9        3.8
Net profit for the period      18.9      33.3      34.9        60.6       67.5


BALANCE SHEET
EUR million
                                                  30.6.                 31.12.
ASSETS                                             2008                   2007

Non-current assets
Goodwill                                          624.7                  626.6
Other intangible assets                           116.8                  112.3
Property, plant and
equipment                                         985.9                  984.3
Holdings in associates                              5.6                    5.5
Available-for-sale
investments                                       182.3                  102.2
Deferred tax assets                                 9.2                    5.2
Defined benefit pension receivables                34.7                   34.6
Other investments                                   8.3                    6.4
Total non-current assets                        1,967.5                1,877.1

Current assets
Inventories                                       324.7                  311.2
Receivables
  Interest-bearing
receivables                                         4.8                    3.2
  Interest-free
receivables                                       637.2                  548.1
Total receivables                                 642.0                  551.3
Money market investments -
cash equivalents                                   18.8                   21.4
Cash and cash equivalents                          35.4                   31.2
Total current assets                            1,020.9                  915.1
Non-current assets held for sale                    2.6                   35.7
Total assets                                    2,991.0                2,827.9

EQUITY AND LIABILITIES                            30.6.                 31.12.
                                                   2008                   2007

Equity attributable to
equity
holders of the parent                           1,105.6                1,072.0
Minority interest                                  14.9                   15.3
Total equity                                    1,120.5                1,087.3

Non-current liabilities
Interest-bearing non-current
liabilities                                       715.3                  431.1
Deferred tax liabilities                          125.4                  105.5
Pension liabilities                                74.3                   74.2
Provisions                                         16.6                   18.8
Total non-current
liabilities                                       931.6                  629.6

Current liabilities
Interest-bearing current
liabilities                                       452.4                  625.0
Interest-free current liabilities                 485.1                  473.6
Provisions                                          1.4                    6.2
Total current liabilities                         938.9                1,104.8
Liabilities directly associated
with non-current
assets classified as held for sale                    -                    6.2
Total liabilities                               1,870.5                1,740.6
Total equity and
liabilities                                     2,991.0                2,827.9

Available-for-sale financial assets include
also shares entitling to electricity from a
nuclear power plant currently under
construction in Finland. In previous
financial statements these shares have been
accounted at acquisition value. In May 2008,
the market price of these nuclear power plant
shares was determined by an external third
party share trading transaction. Due to this,
the Group has booked a revaluation of the
shares, EUR 80 million, with an equity effect
of EUR 59.2 million.

Non-current assets held for sale include
Russian factory site.

CONSOLIDATED CASH FLOW STATEMENT
EUR million                                        1-6/        1-6/
                                                   2008        2007       2007
Cash flows from operating
activities
  Adjusted operating
profit                                            124.3       166.1      281.1
  Interests                                       -32.8       -15.1      -36.3
  Dividend income                                     -         0.1        2.0
  Income taxes paid                               -18.6       -19.5      -35.6
Total funds from
operations                                         72.9       131.6      211.2

  Change in net working
capital                                           -58.3      -108.5      -39.1
Total cash flows from operating
activities                                         14.6        23.1      172.1

Cash flows from investing
activities
  Capital expenditure for
acquisitions                                       -3.9       -44.6      -66.6
  Other capital
expenditure                                       -87.5      -121.1     -254.4
  Proceeds from sale of
assets                                             11.1       -26.0       -0.2
  Net cash used in investing
activities                                        -80.3      -191.7     -321.2
Cash flow after investing
activities                                        -65.7      -168.6     -149.1

Cash flows from financing
activities
  Change in non-current
loans
  (increase +, decrease -)                        135.1        -6.7       53.7
  Change in non-current loan receivables
  (decrease +, increase -)                         -2.1         0.7        2.5
  Short-term financing,
net
  (increase +, decrease -)                         -9.5       216.5      117.8
  Dividends paid                                  -63.9       -59.9      -60.8
  Other                                             7.7         4.0       12.3
Net cash used in financing
activities                                         67.3       154.6      125.5

Net change in cash and cash
equivalents                                         1.6       -14.0      -23.6

  Cash and cash equivalents at end
of period                                          54.2        62.2       52.6
  Cash and cash
equivalents at
  beginning of period                              52.6        76.2       76.2
Net change in cash and cash
equivalents                                         1.6       -14.0      -23.6


CONSOLIDATED CASH FLOW STATEMENT                   4-6/        4-6/
EUR million                                        2008        2007

Cash flows from operating
activities
  Adjusted operating                               61.8        84.5
profit
  Interests                                       -21.6        -9.5
  Dividend income                                     -         0.1
  Income taxes paid                               -14.4       -11.7
Total funds from                                   25.8        63.4
operations

  Change in net working                           -31.4       -10.3
capital
Total cash flows from operating                    -5.6        53.1
activities

Cash flows from investing
activities
  Capital expenditure for                          -3.9       -21.4
acquisitions
  Other capital                                   -48.9       -66.0
expenditure
  Proceeds from sale of                             1.7         6.5
assets
  Net cash used in investing                      -51.1       -80.9
activities
Cash flow after investing                         -56.7       -27.8
activities

Cash flows from financing
activities
  Change in non-current
loans
  (increase +, decrease -)                        144.3      -125.6
  Change in non-current loan receivables
  (decrease +, increase -)                         -2.6        -0.7
  Short-term financing,
net
  (increase +, decrease -)                        -38.5       216.5
  Dividends paid                                  -63.9       -59.9
  Other                                            15.3         3.2
Net cash used in financing                         54.6        33.5
activities

Net change in cash and cash                        -2.1         5.7
equivalents

  Cash and cash equivalents at end
of period
  Cash and cash                                    54.2        62.2
equivalents at
  beginning of period                              56.3        56.5
Net change in cash and cash                        -2.1         5.7
equivalents

STATEMENT OF CHANGES IN EQUITY
EUR million
                                      Capital
                                      paid-in      Fair
                                           in     value
                              Share excess of and other    Exchange
                            capital par value  reserves differences

Shareholders' equity at
January 1, 2007               221.6     257.9      62.7       -30.8
Net profit for the period         -         -         -           -
Dividends paid                    -         -         -           -
Treasury shares issued
to key employees                  -         -         -           -
Share-based compensation          -         -         -           -
Options subscribed
for shares                      0.2         -         -           -
Exchange differences              -         -       0.1        -1.6
Hedge of net investments
in foreign entities               -         -         -         2.8
Cash flow hedging: amount
entered in shareholders'
equity                            -         -      -0.3           -
Acquired minority interest        -         -         -           -
Other changes                     -         -       0.3           -
Shareholders' equity at
June 30, 2007                 221.8     257.9      62.8       -29.6

Shareholders' equity at
January 1, 2008               221.8     257.9      68.2       -41.1
Net profit for the period         -         -         -           -
Dividends paid                    -         -         -           -
Available-for-sale
assets - change in
fair value                        -         -      59.2           -
Share-based compensation          -         -         -           -
Exchange differences              -         -         -        -7.9
Hedge of net investments
in foreign entities               -         -         -         2.3
Cash flow hedging: amount
entered in shareholders'
equity                            -         -       7.3           -
Transfer between
restricted and
non-restricted equity             -         -       0.4           -
Other changes                     -         -      -0.1           -
Shareholders' equity at
June 30, 2008                 221.8     257.9     135.0       -46.7

                           Treasury  Retained  Minority
                             shares  earnings interests       Total

Shareholders' equity at
January 1, 2007               -26.8     585.3      12.6     1,082.5
Net profit for the period         -      58.7       1.9        60.6
Dividends paid                    -     -58.2      -1.7       -59.9
Treasury shares issued
to key employees                0.9      -0.9         -         0.0
Share-based compensation          -       0.8         -         0.8
Options subscribed
for shares                        -         -         -         0.2
Exchange differences              -         -       0.2        -1.3
Hedge of net investments
in foreign entities               -         -         -         2.8
Cash flow hedging: amount
entered in shareholders'
equity                            -         -         -        -0.3
Acquired minority interest        -         -       0.2         0.2
Other changes                     -       0.4      -0.1         0.6
Shareholders' equity at
June 30, 2007                 -25.9     586.1      13.1     1,086.2

Shareholders' equity at
January 1, 2008               -25.9     591.1      15.3     1,087.3
Net profit for the period         -      32.4       2.5        34.9
Dividends paid                    -     -60.6      -3.3       -63.9
Available-for-sale
assets - change in
fair value                        -         -         -        59.2
Share-based compensation          -       0.5         -         0.5
Exchange differences              -         -       0.7        -7.2
Hedge of net investments
in foreign entities               -         -         -         2.3
Cash flow hedging: amount
entered in shareholders'
equity                            -         -         -         7.3
Transfer between
restricted and
non-restricted equity             -      -0.4         -         0.0
Other changes                     -       0.5      -0.3         0.1
Shareholders' equity at
June 30, 2008                 -25.9     563.5      14.9     1,120.5

Kemira had in its possession 3,854,465 of its treasury shares at
June 30, 2008. The number of treasury shares was the same as at the
end of the year 2007. Their average acquisition share price was EUR
6.73 and the treasury shares represented 3.1% of the share capital
and of the aggregate number of votes conferred by all the shares.
The equivalent book value of the treasury shares is EUR 6.8
million.




KEY FIGURES                              1-6/      1-6/
                                         2008      2007        2007

Earnings per share, basic
and
diluted, EUR                             0.27      0.48        0.53
Earnings per share excluding write-downs,
basic and diluted, EUR                   0.27      0.48        0.87
Cash flow from operations
per share, EUR                           0.12      0.19        1.42
Capital expenditure, EUR
million                                  91.4     165.7       321.0
Capital expenditure /
revenue, %                                6.4      11.6        11.4
Average number of shares (1000),
basic *                               121,191   121,136     121,164
Average number of shares (1000),
diluted *                             121,191   121,195     121,194
Number of shares at the
end
of the period (1000),
basic *                               121,191   121,194     121,191
Number of shares at the end of the
period (1000), diluted *              121,191   121,194     121,191

Equity per share, attributable to
equity holders of the parent, EUR        9.12      8.86        8.85
Equity ratio, %                          37.5      37.1        38.6
Gearing, %                               99.4      98.3        92.3
Interest-bearing net
liabilities, EUR million              1,113.5   1,067.4     1,003.4
Personnel (average)                    10,272     9,826      10,008

                                         4-6/      4-6/
KEY FIGURES                              2008      2007


Earnings per share, basic
and
diluted, EUR                             0.15      0.27
Earnings per share excluding write-downs,
basic and diluted, EUR                   0.15      0.27
Cash flow from operations
per share, EUR                          -0.05      0.44
Capital expenditure, EUR
million                                  52.8      87.4
Capital expenditure /
revenue, %                                7.1      11.6
Average number of shares
(1000),
basic *                               121,191   121,180
Average number of shares
(1000),
diluted *                             121,191   121,195
Number of shares at the
end
of the period (1000),
basic *                               121,191   121,194
Number of shares at the
end of the
period (1000), diluted *              121,191   121,194

* Number of shares outstanding,
excluding the
 number of shares bought
back.


REVENUE BY BUSINESS AREA       4-6/      4-6/      1-6/        1-6/
EUR million                    2008      2007      2008        2007       2007

Kemira Pulp&Paper             253.6     267.0     517.5       529.7    1,043.0
Kemira Water                  187.6     173.2     367.1       331.1      686.4
Kemira Specialty              108.8     110.6     215.8       214.1      425.9
Kemira Coatings               205.7     188.7     350.9       324.5      625.2
Other and Intra-Group
sales                         -14.2      13.5     -26.2        26.9       29.7
Total                         741.5     753.0   1,425.1     1,426.3    2,810.2

OPERATING PROFIT BY            4-6/      4-6/      1-6/        1-6/
BUSINESS AREA                  2008      2007      2008        2007       2007
EUR million

Kemira Pulp&Paper              10.1      23.3      25.7        46.2       68.2
Kemira Water                    5.5      13.1      14.7        25.1       43.6
Kemira Specialty                1.6       7.1       5.4        17.4       13.5
Kemira Coatings                29.7      27.3      41.4        40.1       73.1
Other and eliminations         -7.6     -13.2     -14.9       -22.3      -55.3
Total                          39.3      57.6      72.3       106.5      143.1


CHANGES IN PROPERTY, PLANT AND
EQUIPMENT                                          1-6/        1-6/
EUR million                                        2008        2007       2007

Carrying amount at beginning of
year                                              984.3       987.1      987.1
Acquisitions of
subsidiaries                                          -       -14.4       14.3
Increases                                          73.6       105.3      215.7
Decreases                                          -3.9        -3.1       -2.5
Disposal of subsidiaries                           -0.5           -       -7.8
Depreciation and
impairments                                       -56.7       -55.7     -133.2
Exchange rate differences
and
other changes                                     -10.9       -11.1      -89.3
Net carrying amount at end of
period                                            985.9     1,008.1      984.3

CHANGES IN INTANGIBLE
ASSETS                                             1-6/        1-6/
EUR million                                        2008        2007       2007

Carrying amount at beginning of
year                                              738.9       689.9      689.9
Acquisitions of
subsidiaries                                        3.1        42.2       32.2
Increases                                          14.1        14.7       30.4
Decreases                                          -0.1        -0.3       -0.3
Disposal of subsidiaries                              -           -       -0.1
Depreciation and
impairments                                       -10.3       -10.3      -40.6
Exchange rate differences
and
other changes                                      -4.2        10.8       27.4
Net carrying amount at end of
period                                            741.5       747.0      738.9


CONTINGENT LIABILITIES                            30.6.                 31.12.
EUR million                                        2008                   2007

Mortgages                                          24.4                   62.1
Assets pledged
  On behalf of own
commitments                                         6.0                    6.0
Guarantees
  On behalf of own
commitments                                         7.5                    8.3
  On behalf of associates                           1.3                    1.4
  On behalf of others                               0.7                    2.8
Operating leasing
liabilities
  Maturity within one year                         23.1                   22.4
  Maturity after one year                         125.6                  129.0
Other obligations
  On behalf of own
commitments                                         0.7                    0.4
  On behalf of associates                           2.1                    2.3


Major off-balance sheet investment
commitments

Major amounts of contractual commitments for the acquisition of
property, plant and equipment on June 30, 2008 were EUR 16 million
for the investment of Kemira Coatings in Russia and EUR 0.8 million
for the environmental investment in Pori.


Litigation

The Group has extensive international operations and is
involved in a number of legal proceedings incidental to
these operations.

Kemira Oyj, Kemira Chemicals, Inc. and Kemira Chemicals
Canada, Inc. have received claims or were named in
class action lawsuits filed by direct and indirect
purchasers of hydrogen peroxide and persalts in US
state courts and in Canada. In these civil actions it
is alleged that the US plaintiffs suffered damages
resulting from a cartel among hydrogen peroxide
suppliers. To avoid further litigation costs Kemira Oyj
and Kemira Chemicals Canada Inc. have made a settlement
agreement in the US direct purchaser class action in an
US federal court and settled with some others. As
regards the other claims and suits, the proceedings
continue.

The European Union Commisson ordered in June 2008
Finnish Chemicals Oy to pay eur 10.15 million fine for
competition law infringements by sodium chlorate
producers during 1994-2000.


RELATED PARTY
Related party transactions have not changed materially
after annual closing 2007.


DERIVATIVE INSTRUMENTS
EUR million
                                    30.6.2008                       31.12.2007
                            Nominal      Fair               Nominal       Fair
                              value     value                 value      value
Currency instruments
Forward contracts             367.6      -3.1                 942.9       -1.4
of which hedges of
net investment
in a foreign operation            -         -                     -          -
Currency options
  Bought                       72.9      -0.2                  65.5        0.1
  Sold                         58.7       0.3                  57.8        0.2
Currency swaps                143.4      10.1                 147.2        6.5

Interest rate instruments
Interest rate swaps           249.7       4.8                 174.0        2.3
of which cash flow hedge      239.7       4.4                 164.0        2.0
Interest rate options
  Bought                       10.0       0.2                  10.0          -
  Sold                            -         -                     -          -

Bond futures                   10.0       0.2                  10.0        0.2
  of which open                10.0       0.2                  10.0        0.2

Other instuments                         Fair                       Fair value
                                        value
Electricity forward
contracts, GWh                626.4      17.2                 833.6       10.0
  of which cash flow
  hedge, GWh                  626.4      17.2                 833.6       10.0

The fair values of the instruments which are
publicly traded
are based on market valuation on the date of reporting.
Other instruments
have been valuated based on net present values of
future cash flows.
Valuation models have been used to estimate the fair
values of options.

Nominal values of the financial instruments
do not necessarily
correspond to the actual cash flows between the
counterparties and
do not therefore give a fair view of the risk
position of the Group.




QUARTERLY
INFORMATION          2008          2008      2007    2007  2007  2007
EUR million            Q2            Q1        Q4      Q3    Q2    Q1

Revenue
  Kemira Pulp&Paper 253.6         263.9     253.6   259.7 267.0 262.7
  Kemira Water      187.6         179.5     180.3   175.0 173.2 157.9
  Kemira Specialty  108.8         107.0     102.0   109.8 110.6 103.5
  Kemira Coatings   205.7         145.2     118.4   182.3 188.7 135.8
  Other and
intra-Group sales   -14.2         -12.0       0.1     2.7  13.5  13.4
Total               741.5         683.6     654.4   729.5 753.0 673.3

Operating profit
  Kemira Pulp&Paper  10.1          15.6      -1.8    23.8  23.3  22.9
  Kemira Water        5.5           9.2       3.8    14.7  13.1  12.0
  Kemira Specialty    1.6           3.8     -13.9    10.0   7.1  10.3
  Kemira Coatings    29.7          11.7      -5.9    38.9  27.3  12.8
  Other including
eliminations         -7.6          -7.3     -25.1    -7.9 -13.2  -9.1
Total                39.3          33.0     -42.9    79.5  57.6  48.9

Operating profit, excluding
non-recurring items
  Kemira Pulp&Paper  10.1          15.6      12.3    22.6  23.3  21.6
  Kemira Water        5.5           6.8       6.9    14.7  13.1  12.0
  Kemira Specialty    1.6           3.8      -2.0     8.7   7.1  10.3
  Kemira Coatings    29.7          11.7      -3.5    27.7  27.3  12.8
  Other including
eliminations         -9.7         -10.7      -9.6    -7.9 -14.2  -8.6
Total                37.2          27.2       4.1    65.8  56.6  48.1


DEFINITIONS OF KEY
FIGURES


Earnings per share        Equity ratio, %:
(EPS):
Net profit                Total equity x 100 /
attributable to
equity holders            Total assets - prepayments
of the parent /           received
Average number of
shares


Cash flow from            Gearing,  %:
operations:
Cash flow from            Interest-bearing net
operations,
after change in           liabilities x 100 /
net working capital       Total equity
and before
investing
activities


Cash flow from            Interest-bearing net
operations                liabilities:
per share:                Interest-baring liabilities -
Cash flow from            money market investments -
operations /
Average number of         cash and cash
shares                    equivalents


Equity per share:         Return on capital employed
Equity attributable       (ROCE), %:
to equity
holders of the            Operating profit + share
parent at
end of quarter /          of profit or loss of associates
                          x 100 /
Number of shares at       (Net working capital +
end of quarter            property, plant and equipment
                          available for use + intangible
                          assets + investments in
                          associates) *

* Average

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