Holmen intends to reduce the volume of standard newsprint by a total of 150,000 tonnes/year by adjusting the Holmen Paper business areas production strategy and product mix. This process will include a review of the Hallsta paper mills structure with the objective of discontinuing production on PM2, the oldest of the mills four paper machines, which has a capacity of around 110,000 tonnes/year.
The high costs of wood, recovered paper and energy make it essential to overhaul the mills structure in order to create better conditions for the future. This applies to the paper production as well as the energy and pulp production at Hallsta, says Magnus Hall, Holmens President and CEO.
Revaluation of Holmens forests
Following a new valuation of Holmens forest holdings the value of the forest is calculated to increase by around MSEK 2,100. This change in value will result in an increase of around MSEK 590 in deferred tax liability. The revaluation will be taken into the income statement for the fourth quarter of 2007.
Write-down of goodwill
and fixed assets at Holmen Paper
Following a new valuation of goodwill and fixed assets Holmen will write down the value of its goodwill by some MSEK 550. The value of fixed assets will also be written down by an amount corresponding to around MSEK 1,050. The reason for this measure is the high costs of wood, recovered paper and energy. Both the goodwill and the other assets are in the accounts of Holmen Paper. The write-down will be taken into the income statement in the fourth quarter of 2007.
The value of Holmen Timbers fixed assets will be written up by some MSEK 60 in the fourth quarter of 2007. This revaluation relates to previously written down asset values.