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Metsä Group reports “good Q1 result as anticipated”; announces co-determination negotiations in operations as part of cost saving programme

Metsä Group has reported year-on-year sales of €1,438m compared with €1,428m in its Q1 results.

Operating result was €183m compared with €208m a year earlier.

The company said that delivery volumes of market pulp began to grow again after the sudden decline in the previous quarter.

It said: “The market in China picked up, and prices began to rise. In Europe, prices declined.”

President and chief executive Ilkka Hämälä said: “As anticipated, Metsä Group achieved a good result in the first quarter of 2019.

“Our profit-making ability weakened compared to the excellent last year, mainly due to the decline in the price of pulp in late 2018.

“In Asia, the price level of pulp began to rise during the first quarter. In Europe, pulp prices were still in decline, following the price changes in China with a typical market delay. “Compared to the strong growth in demand during the corresponding period in the previous year, the caution attributable to uncertainty factors in world trade was visible in the demand situation in all Metsä Group’s business areas.”

He added that the long-term growth drivers impacting forest industry and Metsä Group’s products included the demand for products made from renewable raw materials, the growth of the global economy, and urbanisation, which continue to be the trends the company will focus on.

“The basis for further development is good. Our future steps will consist of a strong response to the challenge we all face due to climate change.

Metsä Group also announced the start of co-determination negotiations in operations in its tissue business as part of its previously announced fixed cost saving programme.

It said: “As a part of the operational review and €25m fixed cost saving programme, Metsä Tissue starts co-determination negotiations also in the operations.

“The aim is to improve internal efficiency, focus and reduce complexity in tissue business.

“Planned restructuring can lead to organisational changes, such as job changes or redundancies.”\

Co-determination negotiations in operations commenced in May 2019 in compliance with labour-laws in each country.

The company said the estimated reduction is approximately 110 in total.

The cost savings programme will be finalised during the second half of 2019.

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