Stora Enso says it is planning a restructure that – with previously initiated negotiations in its Packaging Materials division – could result in 1,150 job losses.
In a company statement, the Finnish packaging giant says it expects to close several European units and make staff redundant in a bid to boost its profitability and competitiveness.
Stora Enso expects to permanently close down its Sunila pulp production unit in Finland; De Hoop containerboard site in the Netherlands; one containerboard line at its Ostrołęka site in Poland; and its Näpi sawmill in Estonia. These closures are set to impact approximately 600 members of staff.
In addition, the company will initiate change negotiations related to a planned reduction of office staff within its group operations.
Stora Enso recently finalised change negotiations in its Packaging Materials division, with a reduction of around 250 positions in management and support roles.
The planned restructure would reduce the company’s annual sales by €380 million (approx. £325 million), based on the 2022 figures. Meanwhile, operational EBIT is expected to increase by €110 million annually.
Stora Enso president and CEO Annica Bresky said: “These measures are of course very difficult and would not be proposed unless it was absolutely necessary for our long-term competitiveness. We are at a critical juncture in our strategy advancement, and to further our market position an increased focus on capital allocation and decentralised empowerment is needed.”
She continued: “This sadly means that assets suffering from challenged profitability would need to be closed, in combination with a more streamlined headquarter organisation. Through these actions, we would be able to continue to deliver strategic growth from a more resilient and cost-efficient business platform, better equipped to support the long-term growing demand for Stora Enso’s renewable products.”
The Finnish wood market has been impacted by greater competition for pulp wood and the cessation of wood imports from Russia, which has led to “significantly higher wood costs,” the company said.
No decisions relating to the planned closures and staff reductions will be taken until the change negotiations have been completed according to local regulations.
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