Business News

IMPAIRMENT TESTING ACCORDING TO IAS 36

Thursday 15. January 2009 - M-real's annual impairment testing has been finalised. Due to the divestment of Graphic Papers business to Sappi at the end of 2008, a new cash generating unit structure has been defined.

The remaining ex-Graphic Papers business area mills form the following new cash generating units: Hallein, Husum PM8 & Äänekoski Paper and Speciality Papers. Additionally, a new cash generating unit, Market Pulp, has also been defined. The other cash generating units remain the same as in the previous testing.

M-real includes impairment charges of EUR 86 million in its fourth quarter 2008 results comprising:
– EUR 66 million impairment charge including EUR 9 million goodwill in Hallein
– EUR 20 million impairment charge including EUR 11 million goodwill in Husum PM8 & Äänekoski Paper

Of the impairment charge, EUR 66 million is allocated to Other Papers, EUR 16 million to Office Papers and EUR 4 million to Consumer Packaging business areas.

The impairment charges will reduce M-real’s annual depreciations by approximately 10 million.