Stora Enso is to make cutbacks in its wood products division during the fourth-quarter after higher raw material costs and a weak US dollar “negatively impacted” its third-quarter results.
Sales rose marginally from €3.21bn to €3.23bn, with operating profits before non-recurring items also going up year-on-year.
However, excluding non-recurring items, Stora Enso posted operating profits of €207m, down from €216.7m during the same period of 2006 and hindering “one of our key performance metrics”.
“Stora Enso’s results for the third quarter of 2007 were negatively impacted by the same factors that affected our second quarter performance – higher wood costs and the weakening US dollar,” said chief executive officer Jouke Karvinen.
“During the remainder of 2007, we will continue to suffer from high wood and recovered paper costs. We will therefore curtail production in the fourth quarter in both newsprint and wood products.”
This will involve the company’s Finnish sawmills reducing spruce production during the quarter. Mr Karvinen said Stora Enso expects the results for the next two quarters to be impaired by a slowdown in demand from Japan and record material costs in Finland, Russia and the Baltic states.
