Strikes in the Finnish pulp and paper industry started last Monday and will last up to three weeks. This could affect Stora Enso's Q1 profit by €33m.
In Finland, various labour unions in the forestry, paper and chemical industries are currently on a two-week strike. Representatives of the pulp and paper industry announced that the strike would be extended into the third week if no agreement with employee representatives can be found.
According to Stora Enso, the three-week labour actions will have a negative impact on company's operations and results in the first quarter of 2020. The company anticipates the effects of the strike on the bottom line to be €11m per week, which in the case of "a worst case scenario" will translate into a total of €33m for the three-week strike, Stora Enso management explained at the presentation of fouth quarter and full year 2019 financial results.
The effects of the Fininish strikes were taken into account into company's guidance for the first quarter of 2020. Stora Enso expects the operational EBIT to be in the range of €90-200m. The guidance is reportedly impacted by the annual maintenance shutdown at the 455,000 tpy recycled containerboard machne PM 5 at Stora Enso Narew in Ostroleka, Poland. However, during the first quarter 2020, Stora Enso will perform only one maintenance shutdown, compared to two shutdowns in the same period of 2019, when there was also a shutdown at the company's Veracel pulp mill in Brazil.
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