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Nordkalk's Codetermination Negotiations Finalised: Operations Will Continue at all Locations

Nordkalk (info a nordkalk.com), 29 October 2013

Nordkalk Corporation, producer of limestone-based products, ended yesterday the codetermination negotiations that concerned the company's entire personnel in Finland. The goal of the codetermination negotiations was to find a new operations model in order to improve cost efficiency and competitiveness of the company in a changed market situation. Demand for limestone-based products has decreased especially in Nordkalk's big customer segments construction materials and paper industry. In addition, the paper industry is in the midst of a long-term structural change.

Both production capacity and organisational structure were reviewed in the codetermination negotiations. The outcome is that operations will continue at all current locations but production will be centralised in order to raise capacity utilisation rate. At the same time overlapping positions will be cut, and thus the number of personnel in Finland will drop from current 471 to 418. The personnel cuts will be carried out by end-June 2014 and for a big part through retirements arrangements.

Most of the personnel cuts will take place in Pargas and Lappeenranta. Nordkalk employs more than 150 persons at each location. In Lappeenranta 27 jobs will disappear; in Pargas 17 and in Tytyri in Lohja 7. In other locations, Kokkola, Louhi, Siikainen, Sipoo, Vampula and Vimpeli, the total decrease will only be couple of positions.

Part of the group's product development activities have proceeded to marketing and commercialisation stage which are now carried out within divisions. Product development will be reorganised by combining all development activities and laboratory services. Nordkalk will continue to focus on product development and improvement of sales and supply chain.

In Nordkalk's administration the decrease is targeted on overlapping positions in the group and division PulpPaper&Finland, meaning mostly activities in Finance, Human Resources, Communications and Office Services.

Utilisation of Nordkalk's production capacity will be improved by centralisation and transferring production of certain products between units. The biggest change affecting production is the closure of the lime kilns in Lappeenranta. Unless there is a significant change in the market situation, the two kilns dating from the 1930s and 1940s will be closed down in the second quarter of 2014. The final decision on this will be taken during the first quarter of 2014. In addition operations of the quarries, grinding and flotation plants at units will be adjusted to the current demand by reorganising shifts and by merging supporting functions.

Nordkalk will also implement a time bank system at grinding plants, the operations of which are very seasonal. Possibilities to insource or outsource operations have also been studied. In order to lessen the need to decrease personnel, certain currently outsourced operations will be done by own employees in the future.

Several new ideas for developing activities were brought up by the work groups founded for the codetermination process. The combined effect of these measures is estimated to be as much as 2 million euros annually. Total savings resulting from the codetermination process are expected to be 4 to 5 million euros annually.

In addition to Finland Nordkalk operates in Sweden, Norway, Poland, Estonia, Germany, Russia, Lithuania and Ukraine. Also in these countries, the activities will be adjusted to the market situation.

Further information:
Bertel Karlstedt, President & CEO, Nordkalk Corporation, tel. +358 40 553 3859
Jarkko Kaplin, Division Director, PulpPaper & Finland, Nordkalk Corporation, tel. +358 50 409 6501                                                                                                

Nordkalk is the leading producer of high quality limestone-based products in Northern Europe. The products are used mainly in the paper, steel and building materials industries as well as in environmental care and agriculture. The product brand is Nordkalk. The company's turnover for 2012 totalled EUR 351.0 million. Nordkalk employs some 1,100 people and has operations at more than 30 locations e.g. in Finland, Sweden, Norway, Poland, Estonia and Russia. Nordkalk is a member of the Rettig Group.

Leader in Northern Europe

Nordkalk is the leading limestone company in Northern Europe. We deliver essential raw materials to numerous industries, and our solutions contribute to clean air and water as well as productivity of agricultural land.