Money Buzz! Europa

Tag: paper mill

  • Stora Enso to shut down one newsprint paper machine in Hylte Mill

    Stora Enso to shut down one newsprint paper machine in Hylte Mill

    Stora Enso will start codetermination negotiations with employees at its Hylte Mill in Sweden regarding a plan to reorganise the mill, including permanent closure of paper machine PM3 and the deinking plant (DIP).

    After the planned restructuring, the mill would run on 100% thermomechanical pulp (TMP), improving the competitiveness of the unit. 

    The planned closure of PM3 and the reorganisation of the mill would impact a maximum of 140 persons. PM3 is planned to be closed by the end of 2020 and the DIP latest in Q2 2021.

    No decisions regarding the planned reorganisation or employee impact will be taken until the codetermination negotiations have been concluded.

    Impact on Stora Enso’s annual newsprint capacity

    Hylte Mill currently operates two newsprint machines with an annual capacity of 480.000 tonnes. Production at Hylte Mill would continue on one line, PM4 for standard newsprint paper.

    The planned shutdown would decrease Stora Enso’s annual newsprint capacity by 26% or 235.000 tonnes, which represents 4% of total European newsprint paper capacity.

    The planned shutdown would reduce Stora Enso’s total paper capacity by 5%.

    Stora Enso will continue to produce standard newsprint at Hylte, Langerbrugge and Sachsen mills. The closure of Hylte Mill PM3 would not impact Stora Enso’s newsprint product offering.

    The plan would result in annual cost savings of EUR 14 million

    Stora Enso will book restructuring costs of approximately EUR 12 million as an item affecting comparability (IAC) in its Q3 2020 results, of which about EUR 8 million will have a cash impact.

    The planned closure would not have material impact on Stora Enso’s sales or operational EBIT.

    ”The decline in global newsprint demand continues due to changes in consumer behaviour, and it is not expected to recover. This has led to global overcapacity, low operating rates, and poor profitability at the Hylte Mill,” says Kati ter Horst, EVP, Paper division.

  • The new Czech owner of Slovenian paper mill Vipap bets on flexibility

    The new Czech owner of Slovenian paper mill Vipap bets on flexibility

    While until now newsprint and magazine paper accounted for 90% of the production of Slovenian paper mill Vipap Videm Krško, its share will fall by half within three years.

    As a part of the already started restructuring, the new Czech owner RIDG Holding wants to reorient the company more towards the production of food packaging paper. It invests more than a quarter of a billion Czech crowns in the modern technologies that will enable it.

    RIDG Holding took over Slovenian paper mill last year and the company under its leadership ended the calendar year with a significantly positive operating profit EBITDA of € 7 million and a positive cash flow.

    The new owner, in addition to redesigning the company’s processes, also immediately started investing in technology modernization and employees development, in order to make the company more flexible.

    One of the key innovations in Vipap paper mill is the expansion of the product range

    In addition to newsprint, magazines and advertising leaflets, currently also paper bags, carrier bags and laminated paper is being added.

    This segment of production is on the rise due to the fact that a number of European countries have decided to replace the plastic packaging with paper. In addition, new technologies will make it possible to bring to the market the food packaging, that is durable and at the same time fully recyclable.

    In addition to the expanding product portfolio, the Slovenian government’s support programs also helped Vipap Videm Krško to maintain employment during the coronavirus crisis.

    Like many other countries, including the Czech Republic, it has introduced the so-called kurzarbeit. The extraordinary commitment of employees also played an important role.

    Management of Vipap Videm Krško now estimates that in the event of a favorable development, the company could return to pre-crisis level at the end of this year.

    Completion of the restructuring, which is to direct the paper mill towards long-term competitiveness and growth, is planned for the turn of 2021 and 2022.