Paper Maker Stora Enso In $424 Million Q4 Profit

HELSINKI (AP) - Paper maker Stora Enso Oyj on Tuesday reported strong growth in fourth-quarter net profit to euro313 million ($424 million), with sales increasing more than 10 percent.

In 2009, net profit in the period was euro46 million, the Finnish-Swedish company said. Revenue in the period increased to euro2.7 billion, from euro2.4 billion.

Despite the improvement, CEO Jouko Karvinen warned of increased costs and said the company had not yet recovered from the global economic downturn which hit European paper makers.

Karvinen described the short-term outlook as "generally positive" but said demand will remain "below pre-financial-crisis levels in most paper grades and wood products."

Stora Enso stock fell more than 2 percent to euro8.44 ($11.44) in early afternoon trading in Helsinki.

Stora, like other forest product companies, has been forced to cut production, close mills and lay off thousands of workers with overcapacity forcing prices to crash. Karvinen said that in 2010 the company had cut paper making capacity by 700,000 tons by closing four machines in Europe.

Stora said European demand for newsprint would remain weak while demand for coated and uncoated papers would increase slightly.

Stora Enso is one of the world's largest forest product companies making magazine paper, newsprint, fine paper, pulp and packaging boards. It employs 26,400 people - down 4 percent from a year earlier.

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Online:

http://www.storaenso.com