UPM to streamline the production at Kalso and Lohja veneer mills in Finland

(UPM, Helsinki, 18 May 2009 at 10:00) – UPM has started up a new production line at its Kalso veneer mill in Kouvola, Finland. The new line increases the production efficiency of the mill remarkably. In consequence of the increased efficiency the amount of the personnel needs to be decreased by approx. 65 persons. Due to the current market situation, the capacity of the new production line can not be fully used and the mill has to continue operating with reduced production.

UPM will start employee negotiations on personnel reduction and temporary lay-offs with the employees in production and maintenance at the Kalso veneer mill next week. During the negotiations, possibilities for redeployment of the personnel at the other mills of the company as well as retraining will be cleared up. The negotiations are estimated to be concluded in July.

The Kalso veneer mill employs around 190 people, of which some 165 work in production and maintenance. The annual production capacity of the mill is approx. 80,000 cubic meters rotary cut spruce veneers, used as reserve side veneers by parquet industry.

The employee negotiations started in March at UPM's Lohja veneer mill have been concluded. As a result of the negotiations, UPM will reduce the mill's personnel by 15 persons and continue the temporary lay-offs of the entire personnel. The reason for the personnel reductions and temporary lay-offs is the need to adjust production and order-handling resources to the weakened market situation and to increase the profitability of the thin veneer business.

The thin veneer business employs around 100 people in Lohja. At Lohja mill UPM produces birch and pine veneer mainly for European furniture industry. The annual production capacity is approx. 10,000 cubic metres of veneers.

For more information please contact
Kalso mill: Mr Kari Hyvönen, Vice President, UPM, Plywood, Operations, tel. +358 400 258 293
Lohja mill: Mr Panu Anttila, Director, Thin Veneer Mills, UPM Plywood, tel. +358 02041 56330
Both mills: Mr Petri Parjanen, Director, HR, UPM, Plywood, tel. +358 40 833 5297

UPM, Corporate Communications
Media Desk, tel. +358 40 588 3284
communications@upm-kymmene.com

Notes to editors:
UPM is one of the world’s leading forest products groups. The Group employs around 24,000 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