3. World needs a new approach to materials
Renewable packaging
Recyclable packaging
• Responsible and resource
Packaging efficient choice for
packaging material!
• More from less
• End of waste
• Protects goods
• Consumer communication
• Efficient supply chains
Mats Nordlander 22 March 2012 3
4. How we will win!
Customer
experience
Customers
and
Consumers
Products for
Efficient
demanding
supply chain
customers
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5. ”How likely would you recommend
Stora Enso as a supplier?”
Net Promoter Score
Source: Stora Enso Customer Experience Management System VOICE
Mats Nordlander 22 March 2012 5
6. Renewable Packaging
Sales, Operational EBIT, ROOC
EUR million EUR million
EBIT
Sales
2010 14.9%
ROOC 2011 14.2%
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7. Consumer Board performance
against selected peers
ROCE % EBIT 2011
EUR million
272
137
96
309
96
Mats Nordlander 22 March, 2012 7
8. Key challenges Our response
•M&A and greenfield initiatives
• Too small market share in
started to accelerate growth in
growth markets
growth markets
• Competing materials •Investing in R&D - MFC
•Investing in cost competitive RCP
• Non-competitive containerboard
containerboard machine with
capacity
modern lightweight product
• High cost Russian wood in •Reducing costs of Russian wood
Imatra supply
•Debottlenecking, streamlining
• Cost competitiveness
and cost control
• Skoghall Mill wood yard
• Imatra Mills’ pulp drying
• Restructuring in
converting
Restructuring and growth in balance
Mats Nordlander 22 March 2012 8
9. Our strategic growth areas
Virgin-fibre • Global #1
based • Premium
consumer products
board
• Growth markets
Corrugated • Global partner
packaging customers
Mats Nordlander 22 March 2012 9
10. Significant growth expected for corrugated packaging
in Eastern Europe, Asia and Middle East & Africa
CAGR
4.4%
CAGR CAGR
CAGR 1.0% 4.1%
0.5%
Western Eastern
Europe Europe
North
America
CAGR CAGR
2,7 % 4.3%
Asia
2010-2020
Million tonnes
South Middle East &
America Africa
Source: Pöyry and Stora Enso
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11. • EUR 137 million in a new power plant to secure efficient
energy supply completed
Ostroleka • EUR 285 million in a new RCP containerboard machine
• Planned production 455 000 t/a, net impact 370 000 t/a
investments • Focusing on modern lightweight product
• Majority to be consumed internally
• Raw material integration from 35% to 60%
• Acquisition of Inpac International completed in July 2011
Inpac • Strengthens existing relationships with global key
customers by providing packages directly in China
acquisition • Brings synergies with existing consumer packaging
business in Europe
Other •
•
Restructuring in Finland
Quality investments
• Increasing capabilities in packaging design
actions • Expansion in Russia
Mats Nordlander 22 March 2012 11
12. Strongest growth in demand of virgin fibre-
based consumer board will be in Asia
CAGR CAGR
CAGR 1.4 % 4.6 %
0.2 % CAGR
6.9 %
Western Eastern
Europe Europe
North CAGR
America 3.3 %
CAGR
3.5 %
2010-2020 Middle East & Asia
Million tonnes Africa
South Fibre-based CAGR
consumer board
America consumption
China 9%
Pakistan 9%
India 6%
Middle East 4% Source: Pöyry and Stora Enso
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13. Consumers start to buy packaged food once
annual family income reaches USD 5 000
Population in households with annual Population in China in households with
disposable income USD 5 000+ (global) annual disposable income USD 5000+
2002
Annual growth 2.8% CAGR 2010-2020 Annual growth 4.7% CAGR 2010-2020
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14. India, China and Pakistan estimated to drive
growth in terms of milk volumes
Consumption estimate for Liquid Dairy Products
10%
9,0%
9%
8% Total Global LDP
7% average
growth rate:
6%
CAGR 2010 - 2012
2.4%
5%
4%
3,2%
2,8%
3% 2,1%
2% 1,5%1,2%
1%
-0,1% -0,4%-0,3%
-1%
-2%
-3%
-2,8%
-4%
-5%
Volume 57.4 33.7 25.9 22.6 12.8 11 7.7 6.7 5.6 5.1
2012
Bil Litres
Source: Tetra PakSource: Index 2009
Dairy Tetra Pak
Mats Nordlander 22 March 2012 14
15. Accelerate what works
Every third beverage
carton in the world
is produced from
Stora Enso materials!
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16. Stora Enso to build world-class pulp and
consumer board mill in Southern China
Integrate including:
•Paperboard mill of 450 000 tonnes
•Pulp capacity of 900 000 tonnes
•Energy plant
•Auxiliary facilities
Unique set-up: the pulp and board mills to be integrated
with 120 000 hectares of self-managed eucalyptus
plantations
Target to expand the paperboard capacity to 900 000 tonnes
at a later stage
Operations expected to start during Q4/2014
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17. Focusing on high quality segments in China
Unique Chinese platform
position for growth
• A world leading position • Unique integrate
• Technologies and • Established footprint
specifications
• Innovations
• Committed customers
Well prepared project to accelerate profitable growth
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20. Independent sustainability impact studies give
solid platform for the project
• UNDP’s Environmental and • Occupational Health and Safety
Social Impact Analysis (ESIA) Certificate ISO 18001
in 2006
• Environmental Management
• Additional integrated ESIA in System ISO 14001
2012
• Quality Management System
ISO 9001
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21. Key takeaways
Renewable packaging - Solution for the future!
Focus on profitable growth
Clear priorities to accelerate what works
Growing by expanding in China
•Serving mainly global customer base
•Integrated low cost production from domestic
self-managed tree plantations to end product
•Serving demanding customers’ proven know how
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24. Stora Enso’s Operations in China
Personnel currently about 4 500 in China
Dawang Mill
Uncoated magazine paper (170 000 tonnes)
Beijing
Suzhou Mill
Coated fine paper (245 000 tonnes). Customers
include merchants and printing houses
Shanghai
Two core board factories
Hangzhou and Foshan
Beihai Hong Kong
5 Sales branches
Dongguan and Qian’an
Eucalyptus plantations (Inpac)
(90 000 ha)
Guangxi (since 2002)
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25. 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.
Mats Nordlander 22 March 2012 25