The Finnish-Swedish manufacturer reported first-quarter operating profits of 145.5m in May, down 22% on the same period last year (PrintWeek, 2 May). It will issue its second-quarter results on 24 July.

Executive vice president for corporate communications Kari Vainio said the results would be more or less what the market had been expecting.

What is significant is that the performance of both the North American and European markets are now in line with each other, he said.

Stora Enso is attributing the fall in operating profits to the effects of weak economic conditions in Europe, resulting in increasing lower-profit-margin overseas exports from its European mills.

It is also being hit by the fall in value of the dollar and overcapacity in some paper grades, and the weak financial performance of its North American operations due to high energy costs, low production volumes, and only small success in increasing product prices.

It has also incurred costs associated with annual holiday shutdowns at its Nordic mills, especially in Finland.

Despite the news, the companys share price rose 8.5% to 7.60p (SEK103.5) per share.