The feasibility study for the rebuild of the company's Langerbrugge mill is expected to be finalised in the first half of 2023.
Stora Enso will part with its Hylte paper production operations in Sweden but will retain the Packaging Solutions division’s formed fibre and biocomposite operations located at the Hylte site. The company also says that it will discontinue the Anjala divestment process. These steps conclude Stora Enso’s plan announced in March 2022 to divest four of its five paper production sites. In line with its strategy, Stora Enso’s focus is on long-term growth for its renewable products in packaging, building solutions and biomaterials innovations.
The Hylte paper production with its capacity of 245,000 tpy of newsprint and all its related assets will be sold to Sweden Timber. The enterprise value is approximately €18m, Stora Enso says. The completion of the transaction is expected in the first half of 2023. The agreement to divest the Hylte paper site to Sweden Timber has no immediate impact on production nor customer deliveries, Stora Enso says.
Sweden Timber produces wood products to the construction industry and wood retailers and operates four plants in Sweden in Malmbäck, Hjortkvarn, Skillingaryd and Mora.
The Anjala site produces improved newsprint, book paper, LWC and wallpaper base with a capacity of 435,000 tpy. The site already today leverages integrated operations with Stora Enso’s neighbouring Ingerois packaging materials site, utilising synergies in raw material and energy supply. Anjala will continue paper production and serve its customers.
"I am pleased that Sweden Timber will continue to serve Hylte’s paper customers with the intent to further develop the operations. For the Anjala site, we have concluded that the benefits from retaining the site within the group exceed the value of explored divestment opportunities,” says Seppo Parvi, CFO at Stora Enso.
For the Langerbrugge site, the ongoing feasibility study for a potential conversion of one of the site’s two paper lines into a packaging materials line is expected to be finalised in the first half of 2023.
The previously disclosed agreement to divest the Maxau paper site in Germany to Schwartz Produktion is expected to conclude at the beginning of this year. The divestment of the Nymölla paper site in Sweden was concluded on 2 January with ownership transferred to Sylvamo.
In addition to the impairment loss of €19m recorded in the fourth quarter of 2022, Stora Enso will book a disposal loss of approximately €35m in its IFRS operating profit in the first quarter of 2023, as an item affecting comparability. However, these figures are subject to closing date adjustments.
Stora Enso changes segment reporting
On 1 January 2023 Stora Enso adapted its segment reporting to the ongoing reorganisation of the Paper division’s operations and changes in the reporting of emerging businesses in the Packaging Solutions division.
The Paper division was discontinued as of 1 January 2023 and will not be reported as a separate segment going forward. From 1 January 2023, the Maxau and Hylte sites are reported in Segment Other until the completion of the divestments. The retained Langerbrugge and Anjala sites are reported as part of the Packaging Materials division.
From 1 January 2023, the reporting of the emerging businesses in the Packaging Solutions division, including Formed Fiber, Circular Solutions (biocomposites), and Selfly Stores, was transferred to Segment Other.