UPM's CFO says no plans to close any more paper mills

UPM's CFO says no plans to close any more paper mills
Wed Jun 13, 2007 3:54PM EDT

NEW YORK, June 13 (Reuters) - UPM-Kymmene Oyj (UPM1V.HE: Quote, Profile, Research) (UPM.N: Quote, Profile, Research), the world's largest maker of magazine paper, has no plans to close or reduce production at any of its remaining paper mills, Jyrki Salo, the company's chief financial officer, said Wednesday.

Earlier this month, the Helsinki, Finland-based paper manufacturer decided to shut its paper mill at Miramichi, Canada, for up to 12 months, due to a global overcapacity in magazine paper and weak prices.

"If you look at the assets that we have, we have very modern, very high capacity assets ... so now we will be able to generate margins that are well above the industry average," Salo said in an interview.

In March of last year, UPM-Kymmene announced that it planned to close and restructure operations at a number of its facilities in a move aimed at cutting costs, reducing supply and improving profitability.

The company's European and North American rivals like Stora Enso Oyj (STERV.HE: Quote, Profile, Research), M-Real (MRLBV.HE: Quote, Profile, Research) and Neenah Paper Inc. (NP.N: Quote, Profile, Research) have all been undergoing similar restructurings due to market oversupply and weak selling prices.

((Reporting by Euan Rocha; euan.rocha@reuters.com@reuters.net; 1 646 223 6026, editing by J.S. Benkoe)) Keywords: UPMKYMMENE CLOSURES/