UPM plans to transfer plywood processing operations from Lahti to its other plywood mills and prepares for temporary lay offs at Kaukas plywood mill and sawmills in Finland

(UPM, Helsinki, 9 February 2009 at 10:00) – UPM plans to transfer the plywood processing operations from its Lahti processing mill to the company's other plywood mills. In addition, UPM plans to temporarily lay off the entire personnel of the Kaukas plywood mill for over 90 days. Negotiations with all employees at the Lahti processing mill and the Kaukas plywood mill will begin next week. The reason for these plans is the further weakened market situation of plywood.

UPM's Lahti processing mill is specialized in further processing of plywood panels manufactured at the company's own mills. The mill employs some 110 persons.

UPM's other operations, which include the stuff functions for Plywood and Timber business areas, UPM ProFi wood plastic composite business area, and shared corporate functions, will continue in Lahti. These operations employ about 220 people.

The Kaukas plywood mill manufactures uncoated and coated WISA plywood mainly for transport industry. The mill employs some 320 people.

In addition to plywood, UPM manufactures paper, pulp, sawn timber and further processed products at its Kaukas mill in Lappeenranta. Together with other company operations located in the mill site, UPM employs altogether over 1,600 people in Lappeenranta.

UPM prepares for temporary layoffs at its sawmills in Finland

Due to the weak profitability and the continuously weakened market situation in the sawmilling business, UPM's Timber business starts employee negotiations on temporary layoffs at all of its mills in Finland during the second quarter of the year. Duration of possible temporary layoffs in the timber business will be negotiated separately in each production unit and function.

UPM's sawmills in Finland are located in Lappeenranta (Kaukas), Kajaani, Pietarsaari, Korkeakoski, Heinola and Pori. UPM Timber employs approx. 900 people in Finland.

For further information, please contact:
Plywood: Mr Arto Juvonen, Senior Vice President, UPM, Plywood business area, tel. +358 400 557 035
Mr Kari Hyvönen, Vice President, UPM, Plywood, Operations, tel. +358 400 258 293
Timber: Mr. Arto Halonen, Senior Vice President, UPM, Timber tel. +358 40 823 2877

UPM is one of the world’s leading forest products groups. The Group employs around 25,000 people and in 2008 made sales of EUR 9.5 billion. UPM’s main products include printing papers, label materials and wood products. The company has production units in 14 countries and its main market areas are Europe and North America. UPM’s shares are listed on the stock exchange in Helsinki. www.upm-kymmene.com

UPM offers high-quality WISA plywoods and veneers mainly for construction, transport and furniture industries. The sales of UPM Plywood in 2008 were EUR 530 million and it has about 3,700 employees. UPM has 7 plywood mills and 2 veneer mills in Finland, a plywood and a veneer mill in Russia and a plywood mill in Estonia. www.wisa.com

UPM Timber manufactures sawn timber and further processed products mainly for construction, furniture and joinery industries. The annual production capacity is 2.4 million cubic metres of WISA sawn timber products. UPM Timber employs around 1,300 people and it has 15 production units in Finland, Austria, France and Russia.