Filed by Stora Enso Oyj
Pursuant to Rule 425 under the
Securities Act of 1933
Subject Company: Consolidated Papers, Inc.
Commission File No. 001-11359
THE FOLLOWING IS A SLIDE PRESENTATION ANNOUNCING STORA ENSO OYJ'S RESULTS FOR
THE PERIOD JANUARY-JUNE 2000 GIVEN BY STORA ENSO OYJ ON AUGUST 2, 2000.
[slide 0]
Stora Enso Logo
What Paper Can do
Result
JANUARY - JUNE 2000
<PAGE>
[slide 1]
Cautionary statement
This presentation contains statements that are neither reported financial
results nor other historical information. These statements are
forward-looking statements within the meaning of the safe-harbor provisions
of the U.S. federal securities laws. Because these forward-looking
statements are subject to risks and uncertainties, actual future results may
differ materially from those expressed in or implied by the statements. Many
of these risks and uncertainties relate to factors that are beyond Stora
Enso's ability to control or estimate precisely, such as future market
conditions, currency fluctuations, the behaviour of other market
participants, the actions of governmental regulators and other risk factors
detailed in reports filed with the Securities and Exchange Commission by
Stora Enso and Consolidated Papers, Inc. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of
the date of this document. Stora Enso does not undertake any obligation to
publicly release any revisions to these forward -looking statements to
reflect events or circumstances after the date of this document.
We urge you to read the Proxy Statement/Prospectus, which Stora Enso Oyj has
filed with the Securities Exchange Commission as part of a Registration
Statement, because it contains important information. The Joint Proxy
Statement/Prospectus was sent on or about July 28, 2000 to stockholders of
Consolidated Papers, Inc. seeking their approval of the proposed merger of
Consolidated Papers with a subsidiary of Stora Enso Oyj. You may obtain a
free copy of the Proxy Statement/Prospectus and other documents filed by
Consolidated Papers (as well as certain documents filed by Stora Enso Oyj)
with the Commission at the Commission's web site at www.sec.gov. Stora
Enso's Registration Statement on Form F-4 (File No. 333-12342) may also be
obtained from the Commission's public reference room located at 450 Fifth
Street, NW, Washington, D.C. 20549 or at one of the Commission's other
public reference rooms in New York, New York and Chicago, Illinois. Please
call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms. The Registration Statement, including documents
incorporated by reference therein, may also be obtained from Stora Enso Oyj
by contacting Stora Enso Oyj, Attention: Maija Harsu, Investor Relations,
Kanavaranta 1, P.O. Box 309, FIN-00101 Helsinki, Finland, and/or
Consolidated Papers, Inc. by contacting Consolidated Papers, Inc.,
Attention: Tim Laatsch, Corporate Communications, 231 First Avenue North,
P.O. Box 8050, Wisconsin Rapids, Wisconsin 54495-8050. Consolidated Papers,
Inc., its directors, executive officers and certain other members of
Consolidated Papers management and employees may be soliciting proxies from
Consolidated Papers shareholders in favor of the transaction. Information
concerning the participants is set forth in the Proxy Statement/Prospectus.
<PAGE>
[slide 2]
Key Ratios January - June
MEUR 1999 1-6/99 1-6/00
--------------------------------------------------------------
Sales 10,636 5,320 6,086
Operating profit 1,408 601 1,508
% of sales 13.2 11.3 24.8
Operating profit before
non-recurring items 1,306 577 927
% of sales 12.3 10.8 15.2
Profit before tax and
minority interests 1,151 458 1,353
Profit for the period 752 291 923
--------------------------------------------------------------
<PAGE>
[slide 3]
April-June period
Financial targets were met (June 30)
o ROCE 16.9 %* target 13 % over the cycle
o Debt/equity 0.51 target 0.8 in year 2000
o Capex MEUR 295.8 vs depreciation MEUR 453.8
Synergy benefits
o MEUR 115.3 for Jan-June, totalling MEUR 201on 12-month rolling basis
o Target: MEUR 300 by the end of 2002
Non-recurring items (total MEUR 580.7, Jan-June)
o MEUR 526.6 capital gain booked for the sale of energy assets
o MEUR 30.1 surplus in Swedish pension system
o MEUR 24.0 for the Stockholm office (1Q)
*) before non-recurring items
<PAGE>
[slide 4]
April-June period
o Good demand. Markets with limited capacity increases well balanced.
o Stable prices. Improvement in fine paper and pulp prices.
o Financial results affected by
- the paper industry strike
- mid-summer shutdown and start-ups
- increased recycled paper prices.
<PAGE>
[slide 5]
April-June Period
Veracel project
o Construcion of Veracel pulp mill is postponed.
o New partners: Aracruz Cellulose S.A. 45%,
Stora Enso 45%, Odebrecht 10%.
PT Finnantara Intiga, reforestation project in Indonesia
o Ownership raised to 60%.
<PAGE>
[slide 6]
Outlook
o Good worldwide economic growth is expected to continue.
o Supply and demand are fairly well balanced due to good economic growth and
limited capacity increases.
<PAGE>
[slide 7]
Consolidated Papers transaction
o Registration statement on Form F-4 was declared effective by SEC on 28 July.
o An exemption under Public Utility Holding Company Act (PUHCA) to be obtained.
o EGM on 18 August to decide on the transaction.
o Consolidated Papers EGM on 30 August.
o Expect to close the deal by early September.
o Listing on NYSE soon after.
<PAGE>
[slide 8]
Market Outlook
Magazine paper
o Stable demand for LWC and SC is expected to continue.
o Producers' inventories lower than in the 1Q.
o European new capacity is not expected to have any major impact on prices.
Newsprint
o The outlook is good.
o Producers' inventories below normal.
o Supply and demand balance is expected to remain good.
o No further increases in recycled paper prices are anticipated.
<PAGE>
[slide 9]
Market Outlook
Fine paper
o The market is expected to keep firm.
o Order stocks 5-6 weeks.
o Further price increases may be expected in uncoated fine paper in the autumn.
Packaging boards
o Markets for different consumer packaging boards are expected to stay good.
o Corrugated board market will continue good in Finland, Sweden and Russia.
o Demand for containerboard and kraft paper will remain strong.
o Markets for coreboard and cores continue to be good.
<PAGE>
[slide 10]
Market Outlook
Pulp
o Norscan inventories were at 1.1 million tons. List price for long-fibre pulp
USD 710 and for eucalyptus and birch pulp EUR 730.
o The pulp market will benefit from the good paper and board demand and keep
the market tight.
Sawn timber
o Redwood prices are expected to improve.
o Demand is expected to remain strong in Europe but stagnate somewhat
elsewhere.
o Supply is expected to increase in and to Europe.
<PAGE>
[slide 11]
Sales and operating margin
[Bar Graph Reflecting Following Information:
Sales (MEUR) Operating Margin (%)
Q1/97 2,300 9.5
Q2/97 2,500 8.3
Q3/97 2,500 9.7
Q4/97 2,700 10.1
Q1/98 2,693 12.8
Q2/98 2,648 12.0
Q3/98 2,538 12.7
Q4/98* 2,610 8.9
Q1/99* 2,615 10.4
Q2/99 2,706 11.0
Q3/99 2,624 12.9
Q4/99* 2,691 14.8
Q1/00* 2,992 16.4
Q2/00* 3,094 14.1]
*) Before non-recurring items
<PAGE>
[slide 12]
Sales and operating margin
[Bar Graph Reflecting Following Information:
Sales (MEUR) Operating Margin (%)
1995 10,583 16.7
1996 9,510 8.9
1997 9,998 9.7
1998* 10,490 11.3
1999 10,636 12.4
1-6/1999* 5,320 10.8
1-6/2000* 6,086 15.2]
*) Before non-recurring items
<PAGE>
[slide 13]
Profit before tax and minority interest
[Bar Graph Reflecting Following Information:
before non-recurring items after non-recurring items
(MEUR)
Q1/97 148 --
Q2/97 140 --
Q3/97 165 --
Q4/97 180 --
Q1/98 270 --
Q2/98 224 --
Q3/98 222 --
Q4/98 75 -372
Q1/99 233 258
Q2/99 225 --
Q3/99 253 --
Q4/99 363 441
Q1/00 427 451
Q2/00 345 902]
<PAGE>
[slide 14]
Profit before tax and minority interest
[Bar Graph Reflecting Following Information:
(MEUR)
1995 1,401
1996 563
1997 636
1998 339
1999 1,151
1-6/1999* 458
1-6/1999* 772]
*) Before non-recurring items
<PAGE>
[slide 15]
Return on capital employed
[Bar Graph Reflecting Following Information:
after non-recurring items before non-recurring items
(%)
1996 7.8 --
1997 8.0 --
1998 adjusted 6.2 10.2
1999 12.2 11.3
30/06/2000 27.5 16.9]
Target > 13% over the cycle
*) Before non-recurring items
<PAGE>
[slide 16]
Debt/equity
[Bar Graph Reflecting Following Information:
1995 1996 1997 1998 1999 06/30/2000
Debt/equity ration 1.03 1.01 1.05 1.05 0.90 0.51]
<PAGE>
[slide 17]
Capital expenditure and depreciation
[Bar Graph Reflecting Following Information:
1995 1996 1997 1998 1999 06/30/2000
Capital expenditure 894 1,364 1,134 896 740 295.8
Depreciation 721 767 830 891 885 453.8
Non-recurring write downs --- --- --- 245 --- ---]
<PAGE>
Key ratios
[slide 18]
<TABLE>
1999 Q1/99 Q2/99 Q3/99 Q4/99 Q1/00 Q2/00
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings per share, EUR 0.99 0.20 0.18 0.22 0.39 0.39 0.83
Cash earnings per share
(CEPS), EUR 2.16 0.50 0.47 0.51 0.67 0.68 1.14
Return on capital
employed (ROCE), % 12.2 10.7 10.2 11.5 16.1 17.7 36.5
Return on equity (ROE), % 12.9 11.5 9.9 11.9 19.5 19.4 38.9
Debt/equity ratio 0.90 1.10 1.08 1.01 0.90 0.84 0.51
Equity per share, EUR 7.8 6.9 7.2 7.4 7.8 8.0 8.7
Equity ratio, % 38.4 34.0 35.6 36.1 38.4 38.4 43.0
Operating profit, % of sales 13.2 11.7 11.0 12.8 17.5 17.2 32.1
- before non-recurring items 12.3 10.7 11.0 12.8 14.6 16.4 14.1
Capital expenditure, MEUR 740 193 154 171 222 134 162
Capital expenditure, % of sales 7.0 7.4 5.7 6.5 8.2 4.5 5.2
Capital employed, MEUR 11,679 11,489 11,756 11,686 11,679 11,537 10,238
Interest-bearing
net liabilities, MEUR 5,524 6,008 6,097 5,864 5,524 5,261 3,451
-----------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
[slide 19]
Key ratios
1999 1-6/99 1-6/00
------------------------------------------------------------------------
Earnings per share, EUR 0.99 0.38 1.22
Cash earnings per share, EUR 2.16 0.97 1.82
ROCE, % 12.3 10.4 27.5
ROE, % 12.9 10.6 28.9
Debt/equity ratio 0.90 1.08 0.51
Equity per share, EUR 7.8 7.2 8.7
Equity ratio, % 38.4 35.6 43.0
Operating profit, % of sales 13.2 11.3 24.8
- before non-recurring items 12.4 10.8 15.2
Capital expenditure, MEUR 740 347 296
Capital expenditure, % of sales 7.0 6.5 4.9
Capital employed, MEUR 11,679 11,756 10,238
Interest-bearing net liabilities, MEUR 5,524 6,096 3,451
------------------------------------------------------------------------
<PAGE>
[slide 20]
Income Statement
<TABLE>
MEUR 1999 Q1/99 Q2/99 Q3/99 Q4/99 Q1/00 Q2/00
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Sales 10,636 2,615 2,706 2,624 2,691 2,992 3,094
Operating profit 1,408 305 296 337 470 514 994
% of sales 13.2 11.7 11.0 12.8 17.5 17.2 32.1
Operating profit before
non-recurrin items 1,306 281 296 337 392 490 437
% of sales 12.3 10.7 11.0 12.8 14.6 16.4 14.1
Profit before tax and
minority interests 1,151 233 225 253 441 451 902
Profit for the period 752 155 136 167 294 294 634
-----------------------------------------------------------------------------------------
</TABLE>
<PAGE>
[slide 21]
Consolidated balance sheet
<TABLE>
Assets MEUR Q1/99 Q2/99 Q3/99 1999 Q1/00 Q2/00
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fixed assets and other
long-term investments 11,900 11,991 11,840 11,901 11,979 10,491
Current assets 4,242 3,919 4,270 4,133 4,352 5,295
Total assets 16,142 15,910 16,110 16,034 16,331 15,785
Shareholders' equity and liabilities
---------------------------------------------------------------------------------------
Shareholders' equity 5,270 5,470 5,609 5,953 6,069 6,637
Minority interests 211 189 213 202 207 150
Long-term liabilities 6,676 7,070 6,545 6,184 6,218 6,418
Current liabilities 3,985 3,181 3,743 3,695 3,837 2,580
Total shareholders' equity
and liabilities 16,142 15,910 16,110 16,034 16,331 15,785
---------------------------------------------------------------------------------------
</TABLE>
<PAGE>
[slide 22]
Operating profit of
main product areas
EUR million I/99 II/99 III/99 IV/99 I/00 II/00
--------------------------------------------------------------------------------
Magazine paper 59 73 79 76 67 62
Operating profit % sales 14 15 16 14 13 12
Newsprint 74 62 87 77 61 42
Operating profit % sales 18 16 21 18 15 10
Fine paper 42 41 44 69 103 87
Operating profit % sales 8 8 8 12 16 14
Packaging boards 47 42 55 44 81 51
Operating profit % sales 8 7 10 7 12 7
Timber 5 15 10 10 23 20
Operating profit % sales 2 5 4 4 8 6
Market pulp -4 13 37 50 112 117
Operating profit % sales -2 6 15 18 34 34
--------------------------------------------------------------------------------
<PAGE>
[slide 23]
Consolidated Papers' statement of income
Three months ended
------------------------
June June
(Dollars in thousands, ------------------------
except per share data-unaudited) 2000 1999
-------------------------------------------------------------------------
Net sales 506,868 435,119
Income from operations 67,942 29,852
of sales, % 13.4 6.7
Income before provision
for income taxes 54,070 16,800
Net income 32,983 10,080
Net income per share - basic 0.36 0.12
Net income per share - diluted 0.36 0.12
<PAGE>
[slide 24]
Main synergy sources
Actual 1999 Actual 1-6/2000
-------------------------------------------------------------------------
Streamlining of production 17% 35%
Purchasing and logistics 45% 30%
Capital Expenditure and capacity control 1% 4%
Sales and administration 23% 24%
Sharing of best practice 14% 6%
-------------------------------------------------------------------------
Total 100% 100%
<PAGE>
[slide 25]
Consolidated Papers' cost savings programme
USD Million 1999 2000 and forward
----------------------------------------------------------------------
Material Substitution/Reduction 17 16.5
Staffing Reductions 4 23.0
Yield/Salable/First Line 7 6.6
Price Reductions (excludes pulp/wood) 6 7.4
Effluent Reduction 3 1.7
Energy 3 0.48
Productivity 2 23.3
Warehousing/Inventory 1 0.6
Maintenance - 6.0
Other - 0.2
Wood Cost Reductions 1 0.5
----------------------------------------------------------------------
44 86.1
