Stora Enso will close down newsprint and directory paper production at Varkaus


STORA ENSO OYJ STOCK EXCHANGE RELEASE 7 July 2010 at 06.00 GMT                  

Stora Enso will permanently close down newsprint and directory paper production 
at Varkaus in Finland by the end of the third quarter of 2010. The reasons for  
the planned capacity closure announced on 22 April 2010 have not changed: the   
European newsprint and directory paper market is strongly structurally          
oversupplied and sales prices have fallen significantly. As a result, newsprint 
production at Varkaus Mill is expected to remain unprofitable in the long term. 

“The overcapacity position in the European newsprint and directory paper market 
has persisted in 2010. Consequently, sales prices have fallen significantly. In 
the longer term demand in Europe is expected to decline further, as has been    
happening in North America. In addition, the competitiveness of Varkaus is      
weakened because newsprint production at Varkaus relies on less-competitive     
virgin fibre, the availability of wood raw material in Finland is not stable and
Varkaus is far away from most of its customers and main markets,” says Juha     
Vanhainen, EVP, Publication Paper Business Area and Country Manager Finland.    

The closure of the two newsprint machines PM 2 and PM 4 at Varkaus Mill will    
reduce newsprint and directory paper annual production by 290 000 tonnes. The   
co-determination negotiations at Varkaus were concluded at the end of June. As a
result of the ending of newsprint production, 175 employees will be made        
redundant. There are currently 506 employees at Stora Enso's Varkaus Mill.      

The Varkaus mill site will continue to produce pulp and fine paper after        
newsprint and directory paper production ends. The operations of the sawmill and
the NSE Biofuels Oy biofuel joint venture with Neste Oil and its demonstration  
plant will also continue. The ending of newsprint production will not           
substantially affect the amount of renewable energy produced at Varkaus.        

Stora Enso will support redeployment of those affected by the plans through     
efficiently offering jobs internally and eligibility for outplacement services. 
The Group works closely with local employment and economic development centres  
to find new job opportunities for people affected. Stora Enso will also support 
financially those who would like to start their own business.                   

Estimated financial impact                                                      
As announced on 22 April 2010, Stora Enso anticipates that the planned          
permanent shutdown of newsprint production at Varkaus will have the following   
financial impacts on the Newsprint segment:                                     

--------------------------------------------------------------------------------
|                                                        |         EUR million |
--------------------------------------------------------------------------------
| One-time non-cash fixed asset and working capital      |                   0 |
| write-downs in Q2/2010                                 |                     |
--------------------------------------------------------------------------------
| One-time cash provisions in Q2/2010 as non-recurring   |                  23 |
| items                                                  |                     |
--------------------------------------------------------------------------------
| Annual sales reduction                                 |                 148 |
--------------------------------------------------------------------------------
| Annual working capital reduction                       |                   9 |
--------------------------------------------------------------------------------
| Annual operating profit improvement                    |                   9 |
--------------------------------------------------------------------------------


For further information, please contact:                                        
Juha Vanhainen, EVP, Publication Paper Business Area and Country Manager        
Finland, 
tel. +358 2046 21343                                                            
Lauri Peltola, Head of Communications, tel. +358 2046 21380                     
www.storaenso.com                                                               
www.storaenso.com/investors                                                     


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.                     


STORA ENSO OYJ                                                                  



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