Stora Enso Announces Program to Increase Profitability and Competitiveness

Stora Enso announced on Thursday that due to the continued weak and uncertain market environment, the company plans to initiate a new profit improvement program targeting annualized EUR 80 million improvement of the operational EBIT. This could lead to a potential reduction of approximately 1,000 employees. Local change negotiations in line with local legislation will start as soon as country specific plans are further detailed.

Stora Enso is a provider of renewable products in packaging, biomaterials, and wooden construction and one of the largest private forest owners in the world.

The profit improvement program is designed to improve Stora Enso’s long-term competitiveness by focusing on core business activities that can drive the Group’s strategy supported by a decentralized operating model, according to the press release. The program would be implemented without any new production site closures.

At the end of last year, Stora Enso completed a restructuring program which was initiated in June 2023. The program resulted in an annual operational EBIT improvement of EUR 110 million and 1,150 employee reductions.

Stora Enso says that the majority of the savings would materialize during 2025, and the larger part of the employee reductions are planned to take place during the first half of 2024. The employee reductions, efficiency improvements, and synergy opportunities would impact all divisions and Group functions and reflect the size of their respective organizations.

No decisions regarding the planned employee reductions will be taken until the change negotiations have been concluded according to local regulations.

In a statement accompanying the announcement, Stora Enso President and CEO Hans Sohlström said:

“Although difficult, this plan is necessary to ensure our long-term success and competitiveness. Last year, we completed a restructuring program which led to the identification of synergy opportunities, which we plan to address with our new profit improvement initiative. We are facing persistent weakness in the macroeconomic and geopolitical environment and need to focus on core business activities which align with our strategy. Through this program we would strengthen our focus on profitability making us more competitive and resilient to market uncertainties.”