Billerud carries out market-related production curtailment within sack paper - will impact profitability significantly in the fourth quarter

Billerud carries out market-related production curtailment within sack paper -
will impact profitability significantly in the fourth quarter

Billerud will stop all production of white and brown sack paper at its
Skärblacka and Karlsborg mills during the period 22 December to 7 January. This
measure is being carried out in order to adapt production to reduced demand and
avoid a build-up in inventories. 

Significantly reduced activity in the building sector in southern Europe and
high levels of customer inventories have resulted in a strong decline in demand
for sack paper.

Together with other production curtailments, this measure will mean that the
overall production curtailment in the fourth quarter will amount to around 10%
of total production capacity. The total effect of production curtailments and
price erosion will in the fourth quarter 2008 render a negative and
significantly lower result than previously expected.

Billerud's CEO Per Lindberg comments:
“We consider that continued production would lead to price erosion on the market
that would not benefit us in any way, which is why we choose to stop production.
In a process industry like ours, production curtailments of this magnitude
however have considerable consequences for profitability in the short term.”

Stockholm 16 December 2008
Billerud AB (publ)


Per Lindberg
President and CEO



For further information please contact
Per Lindberg, president and CEO, +46 8 553 335 01 or +46 70 248 15 17
Bertil Carlsén, CFO, +46 8 553 335 07 or +46 


Billerud is a packaging paper company with a business concept to supply
customers with innovative and high quality packaging paper. A consistent
concentration on attractive market segments and a strong customer focus are
cornerstones of Billerud's strategy. Billerud focuses on kraft paper and
containerboard and has a world-leading position within several product segments.
The company's production units are among the most cost-efficient in Europe for
these products.