HELSINKI (AP) -- Stora Enso plans to lay off up to 285 workers in Europe and cut costs by $30 million (euro20 million) to further improve efficiency and competitiveness in fine paper production.
The Finnish-Swedish company said Tuesday that it will remodel working methods and cut jobs at several mills, including in Finland, Sweden, Germany, Belgium and Britain.
"Fine paper demand is still clearly below pre-crisis levels, and there are no signs of sustained recovery," Hannu Alalauri, from Stora's fine paper division, said. "We are comparing the best practices at all our mills so we can continuously adopt the most efficient ways of working."
Stora Enso stock was down more than 1 percent at euro8.00 ($11.87) in early afternoon trading in Helsinki.
The paper maker aims to achieve the annual cost cutting target of euro29 million by the end of the second quarter in 2012.
Like many forest product companies, Stora has been struggling with persistent overcapacity in European paper markets, forcing it to cut production, close mills and lay off thousands of workers. Last year, it reduced paper volumes by 700,000 tons, closing four paper-making machines in Europe.
Alalauri noted that the company "has been successfully remodeling our operations during the past few years, and now we plan to continue on the chosen path of improving our existing businesses."
Last month, the company reported that first-quarter net profit surged to euro156 million on growing sales, driven by higher paper prices and increased demand. But it cautioned that growing inflation would hit the company's second-quarter performance.
CEO Jouko Karvinen said that growing inflation was "now our short-term focus and concern."
Helsinki-based Stora Enso Oyj is one of the world's largest forest product companies making magazine paper, newsprint, fine paper, pulp and packaging boards. It employs 26,300 people worldwide.