rethink Stora Ensorethink. Stora Enso

CEO Jouko Karvinen

It h ld b t d th t t i t t t h i hi h t hi t i l f t i l di ith tIt should be noted that certain statements herein which are not historical facts, including, withoutlimitation those regarding expectations for market growth and developments; expectations for growthand profitability; and statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or similarexpressions, are forward-looking statements within the meaning of the United States Private SecuritiesLiti ti R f A t f 1995 Si th t t t b d t l ti t dLitigation Reform Act of 1995. Since these statements are based on current plans, estimates andprojections, they involve risks and uncertainties which may cause actual results to materially differ fromthose 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

ffi i i th i ti d f d t d l t t f d t iefficiencies therein, continued success of product development, acceptance of new products or servicesby 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 protectioncreated by the Group’s patents and other intellectual property rights, the availability of capital onacceptable terms (2) ind str conditions s ch as strength of prod ct demand intensit of competitionacceptable 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 theGroup, 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 geographicgeneral economic conditions, such as rates of economic growth in the Group’s principal geographicmarkets or fluctuations in exchange and interest rates.

8 June 2011rethink. Stora Enso 2

Stora Enso sustainable competitive differentiationStora Enso – sustainable, competitive differentiation

8 June 2011 3rethink. Stora Enso

rethink businessrethink innovation rethink customer servicerethink our attituderethink productsrethink processes

thi k t i lrethink materialsrethink the future

8 June 2011 4rethink. Stora Enso

World needs a new approach to materialsWorld needs a new approach to materials

8 June 2011rethink. Stora Enso 5Source: www.cartonawards.com

Proof points of actionpOur direction

G th k t• Growth marketsProof points: • Inpac acquisition

O t l k t i b d i t t

• Growth markets

• Plantation based pulp• Ostroleka containerboard investment• Investment to Montes del Plata

• Plantation-based pulpP f i t

• Plantation-based pulp

• Fibre-based packagingProof point: • Investment to Montes del Plata

• Fibre-based packaging• Selected paper grades

Maintain and develop globalleadership positionProof points: • Inpac acquisition• Ostroleka containerboard investment

• Selected paper grades

8 June 2011 6

Implementing strategy

Project On target Other progress

p g gyHigh return growth businesses

oject O ta get Ot e p og essMontes del Platapulp mill, Uruguay

Machinery and portsuppliers selected and contracted for MdP

Ostrolekacontainerboard machine, Poland

Proceeding as planned

Poland

CLTinvestment, Ybbs, Austria

All permits received, main machine supplier selected

Skoghallinvestment

Support wood handling in Sweden and furtherinvestment Sweden and further develop Skoghall mill

Inpac Integration planning strongpackaging company in China and India

7

rethink. MaterialsSource reduction! Bio polymers!

Index 1970 = 100

190

200

Index 1970 = 100Calculated on wood consumption

170

180

190

s pe

r tre

e

150

160

ount

of b

lank

s120

130

140

Rel

ativ

e am

o

100

110

120R

8 June 2011rethink. Stora Enso 8

1970 1977 1994 1998 2002 2005 2008 2011

Groundbreaking investment in nanotechnologyGroundbreaking investment in nanotechnology

Fi d i li i h ld• First production line in the world– Microfibrillated cellulose (MFC)

• Full capacity end of 2011 – enable 100 000 tonnes of board

• 10 MEUR technology project

• More with less– Lighter and stronger material

f d k ifor paper and packaging– Less raw material need– Lower logistic costs

9

Wood has a good story to tellWood has a good story to tell

• Superior carbon footprint compared to any other building material• Joint efforts as an industry to remove all norms and standards that are

unjustly discriminating against wood in various end-uses

1000

0

500

Steel frame Light weight t bl k

Aircrete block Brick Concrete Wood

g

-1000

-500 concrete block

g/kg

C b i k /k

-2000

-1500Carbon sink, g/kg

CO2 emissions of manufacturing, g/kg

Source: Puuinfo / Finnish Forest IndustriesSource: Puuinfo / Finnish Forest Industries

8 June 2011rethink. Stora Enso 10

Mobile ecosystems accelerating impact ?Mobile ecosystems – accelerating impact ?

8 June 2011rethink. Stora Enso 11

And iPod with iTunes ”killed” the music industry ?

This is not about reading newspapers on tablets but how the consumers spend their time ?

F b kSocial media adopted faster than

% f U S l ti i t h l / i

• Facebook

– 3rd largest population after China and India

Social media adopted faster than any other device / media

80%

% of U.S. population using technology/service

– Half of UK mobile web traffic

– Fastest growing segment 55-65 ld f l

60

Facebook

DVD Player

TelevisionRadio

year old females

– 1 out of 8 US couples married met on it

20

40Youtube

Cellphone

• Let’s ask the people driving this change!

N h h f id f i

0

PC

0 5 10

Telephone

– Not the ones who are afraid of it (and tell us what we want to hear)

Years after product launch

8 June 2011rethink. Stora Enso 12

Productivity – 40% improvement in 6 yearsy p yRethinking productivity

4,0

FTE per 1 m€ Sales*

3 8 employees needed to create EUR 1 million of sales in 2005

3,4

3,6

3,83.8 employees needed to create EUR 1 million of sales in 2005

2.7 employees needed to create EUR 1 million of sales in 2010

2 8

3,0

3,2

FTE’

s

EUR 1 million of sales in 2010

2,4

2,6

2,8

2,0

2,2

2005 2006 2007 2008 2009 2010

8 June 2011rethink. Stora Enso 13

*continued operations excl Merchants and North America, 2005 adjusted for FIN strike impact

Rethinking continues!Rethinking continues!