M-real launches programme to improve profitability of Finnish operations

Metsäliitto Group's subsidiary M-real is starting up a programme to improve the profitability of its operations in Finland. The programme aims to achieve a full profit improvement of some 40 million euros from the beginning of 2009. The measures to be taken will involve almost all units, and it is estimated that implementing the programme will reduce the number of employees by about 600 persons in addition to those concerned by the presently ongoing programmes. As far as can presently be seen, it will not be necessary to close any of the production plants entirely. The realisation of the profit impact and of the reduction of the number of personnel both depend on the outcome of the statutory workplace consultations.

"M-real has today announced its result for 2006, which still shows heavy losses. The restructuring programme announced on 18 October 2006, which is proceeding in many respects more rapidly than was planned, focuses on M-real's units outside Finland. The programme we announced today aims to return M-real to profitability in our Finnish units as well," says CEO Mikko Helander.

A thoroughgoing re-engineering process has already begun with changes in the top management as well as in the support functions in head office, where the consultation process continues. The more extensive profit improvement programme to be implemented in the Finnish mills means that on 8 February M-real will present all personnel groups with its proposal to start consultations in accordance with the Finnish Act on Cooperation within Undertakings. The consultations will concern M-real's production units in Kirkniemi, Kyro, Kemi, Simpele, Joutseno, Kaskinen, Kangas, Äänekoski, Lielahti and the Tako carton plant in Finland.

The statutory consultations will start up in the week beginning on 12 February, and be concluded by the end of March at the latest. They will be conducted in each unit and function by utilising local knowledge. In the consultations, ways will be sought to make operations profitable and thus to safeguard the continuation of operations in the localities involved. In addition, M-real will also discuss with the personnel groups and trade unions about "change security" with regard to all personnel groups in the event of personnel reductions.

"In cooperation with the representatives of the personnel, we want to ensure that there will be at least one paper industry company in Finnish hands in Finland in the future too, giving work to Finnish people and processing Finnish wood. I believe that the programme announced today will help us achieve that goal," Mikko Helander declares.

More information:
Mikko Helander, CEO, tel. +358 10 469 4300
Anne-Mari Achrén, Group Communications, tel. +358 10 469 4541






Source: M-real