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Stora Enso s Position and Strategy in Publication Papers Capital Markets Day 2003

1. It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profitability; and statements preceded by believes", expects", anticipates", foresees",

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Stora Enso s Position and Strategy in Publication Papers Capital Markets Day 2003

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    1. Stora Enso’s Position and Strategy in Publication Papers Capital Markets Day 2003 Jarmo Alm Senior Vice President, Business Area Newsprint & Book Papers

    2. 1 It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profitability; and statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or similar expressions, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Since these statements are based on current plans, estimates and projections, they involve risks and uncertainties which may cause actual results to materially differ from those expressed in such forward-looking statements. Such factors include, but are not limited to: (1) operating factors such as continued success of manufacturing activities and the achievement of efficiencies therein, continued success of product development, acceptance of new products or services by the Group’s targeted customers, success of the existing and future collaboration arrangements, changes in business strategy or development plans or targets, changes in the degree of protection created by the Group’s patents and other intellectual property rights, the availability of capital on acceptable terms; (2) industry conditions, such as strength of product demand, intensity of competition, prevailing and future global market prices for the Group’s products and the pricing pressures thereto, price fluctuations in raw materials, financial condition of the customers and the competitors of the Group, the potential introduction of competing products and technologies by competitors; and (3) general economic conditions, such as rates of economic growth in the Group’s principal geographic markets or fluctuations in exchange and interest rates.

    3. Business Drivers

    4. 3 Business Drivers Importance of Advertising Main driving force for the consumption of publication papers is advertising In USA newspaper revenues depend up to 87% and magazines up to 70% on advertising The macro-economic mechanism: economy drives consumer confidence consumer confidence drives consumption consumption drives advertising advertising drives paper consumption

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    7. 6 Leading Publication Papers Producers

    8. Stora Enso Publication Papers

    9. 8 Publication Paper Mills

    10. 9

    11. 10

    12. 11 Leading Market Position Grow through M&A and profitable investments Continuous development of product quality and product innovations Strengthen sales & marketing, implement CRM approach Competitiveness Improve competitiveness by asset restructuring Focus on cost control HR Development Focus on performance culture and competence development Attract and retain best people

    13. 12 Stora Enso Newsprint Business Strong market position in slow growing market Objectives Improvement of the asset structure and utilisation of the assets No significant capacity increase Improvement of cost competitiveness and product quality Closure or up-grading of non-competitive production lines Ongoing Programme New Langerbrugge PM4 (std news) Closure of Summa PM1 (std news) Conversion of Langerbrugge PM3 from standard newsprint to magazine paper Upgrade of Summa PM2 to specialities Quality & productivity upgrade of Sachsen PM1

    14. 13 Uncoated Magazine Paper Stora Enso Uncoated Magazine Paper Business SC-A: Strong market position with moderate competitiveness SC-B: Minor market position in a fast growing market Objectives SC-A: Keep market position and improve competitiveness SC-B: Improve market position Ongoing Programme SC-A New SC-A (+) paper machine in Kvarnsveden Shut-down of Kvarnsveden PM 9 (Newsprint) Stop SC-A production in Wolfsheck mill Closure of Langerbrugge PM2 SC-B Rebuild of Maxau PM 6 Conversion of Langerbrugge PM 3 from Newsprint to SC-B

    15. 14 Stora Enso Coated Magazine Paper Business Moderate market position and average asset quality in LWC Strong market position and average asset quality in MWC Objectives Harmonise and improve paper quality Increase competitiveness and asset quality Ongoing Programme Rebuild of Kotka PM2 Rebuild of Corbehem PM5 Quality development, e.g. StellaPress Delta and SolarisPress Bulky Evaluate restructuring possibilities

    16. 15 Cost Saving Programme Main Actions Personnel reductions Major steps in Anjala, Summa, Corbehem Decrease external maintenance work Substitution of spruce roundwood in Finland Baltic sawmill chips / first thinning pine Reduce usage of chemical pulp Hylte TMP, Anjala PGW, Varkaus TMP Aggressive purchasing Reduce overhead costs Improve logistic chain / decrease transportation costs

    17. Visit www.storaenso.com for more information.

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