Pre-close Trading Update

30 June 2014

Powerflute Oyj

Pre-close trading update

Powerflute Oyj ("Powerflute" or the "Group"), the paper and packaging group, today provided the following update on trading for the six months ended 30 June 2014.

The Group performed strongly during the first half of the year with volumes, revenues and profits from operating activities all ahead of the same period of the prior year. Despite tough economic conditions across much of Europe and elsewhere, the trading environment for the Group continued to be broadly favourable, with healthy demand and attractive selling prices in most major markets and stable raw material and other input costs. The Group was able to capitalise on these favourable conditions with another strong operational performance and this is reflected in a further improvement in EBITDA generated from operating activities.

In recent weeks, there has been some softening of demand and pricing in containerboard markets generally due to normal seasonal factors, although overall activity continues to be good for the time of year. Against this background, demand for the Group's products has remained robust and we begin the second half with a healthy forward order book.

Dermot Smurfit, Chairman of Powerflute, commented:

"The Group has delivered another strong performance in the first half of the year due to a combination of favourable market conditions, further increases in production output and tight control of operating costs. We are pleased with the progress achieved so far this year and while we do not expect any improvement in the general economic environment, we are cautiously optimistic that market conditions will remain broadly favourable and that the current strong performance will continue into the second half of the year".

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About Powerflute

Powerflute Oyj ("Powerflute" or the "Group") is a paper and packaging group quoted on the AIM market of the London Stock Exchange (Ticker: POWR). The Group operates a paper mill in Kuopio, Finland which produces a specialised form of semi-chemical fluting made from locally sourced birch. Corrugated boxes manufactured using Nordic semi-chemical fluting demonstrate superior strength and moisture resistance and are used for transportation of fruit and vegetables, high-value industrial goods such as electrical appliances and automotive components. The Kuopio mill is one of only three suppliers of Nordic semi-chemical fluting in Europe.