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STOCK EXCHANGE RELEASE 30 Oct 2007

INTERIM REPORT JANUARY 1 - SEPTEMBER 30, 2007

The Pöyry Group's net sales for the period under review were EUR 512.7 million (450.9 million in the same period in 2006). Profit before taxes was EUR 53.2 (34.1) million.
 
The Group's consolidated balance sheet is healthy. The equity ratio was 46.2 (47.3) per cent and the net debt/equity ratio (gearing) -35.0 (-22.3) per cent.
 
Earnings per share were EUR 0.61 (0.38) and the return on investment 38.3 (28.1) per cent.
 
The order stock increased by EUR 76.1 million to EUR 583.7 million during the review period. The number of personnel increased, amounting to 7246 at the end of the review period (6389 at the end of 2006).
 
Consolidated net sales will increase during 2007. Profit before taxes will improve significantly in 2007 and be EUR 72-77 million. This estimate can be negatively affected by the ongoing labour market negotiations in Finland.
 
The interim report has been prepared in accordance with the IAS 34 following the same accounting principles as in the annual financial statements for 2006. In the Financial Statements for 2007 the Group will also adopt the new standards "IFRS 7 Financial Instruments: Disclosures" and "IAS 1 Presentation of Financial Statements - Capital Disclosures".
 
The data in this interim report are unaudited.
 
Business groups
 
Energy
 
Net sales for the period under review were EUR 154.8 (137.5) million. Operating profit was EUR 15.6 (10.2) million.
 
Demand for energy-related services has remained good especially in Europe, and the business group has further strengthened its global market position. The corporate acquisitions in the consulting business and in the oil and gas sector in 2006 have had a favourable impact on earnings during the period under review.
 
The order stock is good, amounting to EUR 223.7 million at the end of the review period (204.9 at the end of 2006). The most important new projects were the bioethanol plant for San Carlos Bioenergy Inc. in the Philippines (EUR 10 million), the Puttalam coal-fired power plant project in Sri Lanka (EUR 7 million), the combined heat and power plant project with Propower GmbH in Germany (EUR 6.2 million), the OGK-3 coal-fired power plant in Russia (EUR 2 million), Fortum Power and Heat Oy's combined heat and power plant project in Finland (EUR 5 million), the Rudbar-e-Lorestan hydropower project in Iran (EUR 7 million), the diesel oil storage EPC contract with Esergui s.a. in Spain (EUR 9.5 million) and the Vung Ang coal-fired power plant in Vietnam (EUR 11 million).
 
Forest Industry
 
Net sales for the period under review were EUR 197.2 (164.6) million. Operating profit amounted to EUR 26.3 (15.4) million.
 
Most of the forest industry's new investments have been directed to Latin America. Several biofuel projects, especially in North America, have improved the business group's capacity utilisation and earnings. New openings, among others in the chemical industry, have also improved the earnings for the period under review. Demand for local engineering services and operations improvement services has remained stable, as has demand for consulting services. The business group's order stock has increased, amounting to EUR 143.3 million (111.4 million at the end of 2006), and is on a good level. The most important new projects received during the review period were the implementation of the bleached hardwood kraft pulp mill of VCP - MS Celulose Sul Mato-Grossense Ltda (the new name of Chamflora - Três Lagoas Agroflorestal Ltda) in Mato Grosso do Sul, Brazil (EUR 54 million), Stora Enso's paper machine rebuild at Wisconsin Rapids in the United States, the rebuild of two paper machines for Billerud AB in Sweden, Holmen Paper AB's TMP plant upgrade at the Braviken mill in Sweden (EUR 2 million), the containerboard production line project with Mondi Packaging Paper GmbH (EUR 12 million) and Portucel's new paper mill project in Portugal (EUR 10 million).
 
Infrastructure & Environment
 
Net sales for the period under review were EUR 159.8 (147.7) million. Operating profit was EUR 11.6 (9.5) million.
 
Demand in the infrastructure and environment markets has remained stable. The business group has continued to strengthen its position in local and international markets.
 
The order stock amounted to EUR 216.7 million (191.0 at the end of 2006), which is a good level. The most important new projects were the contract with the German Railways (DB ProjektBau GmbH) for improvement of the railway network of Berlin (EUR 3 million), waste water management projects in Brno, Czech Republic and Paris, France (totally EUR 2.5 million), the traffic control system project with ASFINAG (Autobahnen- und Schnellstrassen- Finanzierungs- Aktiengesellschaft) Verkehrstelematik GmbH in Linz, Austria (EUR 1.3 million), railway line projects in Algeria and Finland (totally EUR 3.5 million), the contract with the Latvian real estate company SIA Vertikala Pasaule for construction management and site inspection services in Latvia (EUR 3 million), the contract with the Finnish Rail Administration to improve the service standard on the Lahti - Luumäki railway track (EUR 3 million), the urban mass transit project in Munich, Germany and road engineering assignment in Romania (EUR 7 million).
 
Group structure
 
Energy
 
Pöyry has divested its French subsidiary Pöyry Energy (Lyon) SAS and sold its 100 per cent ownership in the company. The reason for the sale was that the company's profile and product portfolio were not in line with the current strategy of the Energy business group. The income from the sale was EUR 0.7 million.
 
In August Pöyry expanded its management consulting services portfolio and market presence for the energy industry by acquiring ECON Analyse AS, Norway. The company's main operational bases are in Oslo and Stavanger, Norway, Stockholm, Sweden and Copenhagen, Denmark, and it is well-established in all of its markets. The company's net sales in 2006 amounted to EUR 13 million and it employs 85 experts. Following the transaction, Pöyry further strengthened its position as the leading energy management consultant in Europe, employing 250 experts. ECON Analyse AS has been consolidated into Pöyry as of September 1, 2007.
 
Forest Industry
 
Pöyry expanded its business in Russia by acquiring in June 70 per cent of the shares of ZAO Giprobum Engineering, based in St. Petersburg, Russia. The company's net sales are about EUR 5 million and it has a staff of 260. The transaction includes an option to acquire the remaining 30 per cent of the shares during the first half of 2009. The services of Giprobum Engineering include investment studies, services related to permitting and agreements with authorities, various sectors of plant engineering, and construction management services. Giprobum Engineering has a wide clientele both in pulp and paper and mechanical wood industries in Russia, Ukraine, Belarus and several Eastern European countries. Giprobum Engineering is consolidated into the Pöyry Group as of the end of June.
 
In September Pöyry acquired 100 per cent of the share capital and votes of Insinööritoimisto Pöysälä & Sandberg Oy, a Finnish company specialised in structural engineering. Together Pöyry Civil Oy and Pöysälä & Sandberg will create the largest structural engineering company in the industrial investment building sector in Finland. Pöysälä & Sandberg is specialised in industrial building construction and structural engineering of office and commercial buildings. Its net sales amounted to EUR 7.5 million in 2006. The company employs about 100 experts in offices in Helsinki, Kuopio and Oulu in Finland. The company has been consolidated into the Pöyry Group as of September 1, 2007.
 
Infrastructure & Environment
 
Pöyry strengthened its quantity and cost calculation know-how by acquiring in May 100 per cent of the shares of Insinööritoimisto Rakennuslaskenta NHL Oy, Finland. Rakennuslaskenta NHL had net sales of more than EUR 2 million in 2006. The company is consolidated into the Pöyry Group as of the end of May.
 
In June Pöyry acquired 70 per cent of the shares of Evata Worldwide Oy, a Finnish architectural design and real estate consulting firm. Evata employs about 100 experts in its headquarters in Helsinki, and in offices in Tallinn, Estonia, and Beijing, China. It also has a representative office in St. Petersburg, Russia. Evata offers architectural and interior design, workplace design, office property consulting and services related to real estate development. The company's annual net sales are about EUR 10 million. The deal includes an option to acquire the remaining 30 per cent of the company's shares in 2010, at the earliest. After completion of the acquisition, Pöyry's real estate expertise will cover all major sectors of the business: project management, design, real estate consulting and architecture. Evata is consolidated into Pöyry Group as of the end of June.
 
In October Pöyry expanded its waste management services portfolio and market presence in the environmental business by acquiring Ingenieurgemeinschaft Witzenhausen Fricke & Turk GmbH, Germany. The acquisition strengthens Pöyry's position in Germany as a leading consultant in environmental consulting and engineering, employing more than 300 experts. The company's net sales in 2006 amounted to EUR 2 million and it employs 20 experts. The company will be consolidated into Pöyry as of October 1, 2007.
 
Order stock
 
The Group's order stock is good. It increased by EUR 76.1 million during the period under review, totalling EUR 583.7 million at the end of September. At the end of 2006 the order stock was EUR 507.6 million.
 
Personnel
 
The number of personnel in the Group has increased, amounting to 7246 (6389 at the end of 2006).
 
Balance sheet structure and financial position
 
The Group's consolidated balance sheet is healthy. The equity ratio at the end of the review period was 46.2 per cent (49.2 at the end of 2006). The Group's liquidity is good. The net debt/equity ratio (gearing) was -35.0 per cent (-37.6 at the end of 2006).
 
Capital expenditure
 
The Group's capital expenditure for the period under review totalled EUR 42.3 (20.3) million, of which EUR 6.0 (6.8) million was invested mainly in IT hardware, software and systems and EUR 36.3 (13.5) million in corporate acquisitions.
 
Risks and uncertainties
 
No such new major risks or uncertainties were identified in the period under review which, if materialised, would be assessed to have a significant impact on the Group. A detailed report on the Group's risks and risk management is given in the Financial Statements of 2006.
 
Share capital and shares
 
The share capital at the end of 2006 was EUR 14 545 036 and the total number of shares was 58 180 144. During the period under review a new share issue was executed and new shares were subscribed with stock options 2004A. After the share issue and subscriptions the share capital is EUR 14 576 619 and the number of shares 58 605 178.
 
The company's shares are quoted on the OMX Nordic Exchange in Helsinki. The average trading price during the period under review was EUR 15.11, with a high of EUR 18.13 and a low of EUR 11.37. A total of 11.3 million of the company's shares were traded, equalling 19.3 per cent of the total number of shares and corresponding to a turnover of EUR 172.2 million.
 
The Annual General Meeting decided that a dividend of EUR 0.50 be distributed per outstanding share for 2006 (EUR 0.325 for 2005), totalling EUR 29.1 million. The dividend was paid on March 15, 2007.
 
Stock options
 
Pöyry Plc issued in 2004 stock options to the management of the Group as well as to a wholly-owned subsidiary of Pöyry Plc. The number of stock options is 550 000, entitling to subscription of four shares each, i.e. a total of 2 200 000 shares in Pöyry Plc.
 
The share subscription periods are for stock options 2004A (660 000 shares) between March 1, 2007 and March 31, 2010, for 2004B (660 000 shares) between March 1, 2008 and March 31, 2011, and for 2004C (880 000 shares) between March 1, 2009 and March 31, 2012. All stock options have been issued and their receipt confirmed.
 
During the period under review 126 332 new shares were subscribed with stock options 2004A.
 
Authorisation to issue shares
 
The Annual General Meeting on March 5, 2007 authorised the Board of Directors to decide to issue new shares and to convey the company's own shares held by the company in one or more tranches. The share issue can be carried out as a share issue against payment or without consideration on terms to be determined by the Board of Directors and in relation to a share issue against payment at a price to be determined by the Board of Directors.
 
A maximum of 11 600 000 new shares can be issued. A maximum of 5 800 000 own shares held by the company can be conveyed.
 
During the period under review Pöyry Plc issued new shares as compensation in the acquisition of Insinööritoimisto Pöysälä & Sandberg Oy. The acquisition was realised as an exchange of shares where the sellers were granted 298 702 new shares in Pöyry Plc. After this issue the number of new shares which can be issued is not more than 11 301 298 new shares.
 
The authorisation is in force until the next Annual General Meeting.
 
The decision made by the Annual General Meeting was published in its entirety as a stock exchange notice on March 5, 2007.
 
Authorisation to acquire the company's own shares
 
The Annual Meeting authorised the Board of Directors to decide to acquire the company's own shares with distributable funds on the terms given below. The acquisition of shares reduces the company's distributable non-restricted shareholders' equity.
 
A maximum of 5 800 000 shares can be acquired. The company's own shares can be acquired in accordance with the decision of the Board of Directors either through public trading or by public offer at their market price at the time of purchase.
 
The authorisation is in force until the next Annual General Meeting. The Board has not exercised the authorisation during the period under review.
 
The decision made by the Annual General Meeting was published in its entirety as a stock exchange notice on March 5, 2007.
 
Pöyry Plc does not hold its own shares. A subsidiary of Pöyry Plc owns 8914 Pöyry Plc shares with a nominal value of EUR 2 228.50, which equals 0.02 per cent of the total number of shares and voting rights.
 
Prospects
 
Energy
 
The good performance of Southeast Asian, Latin American and European economies, combined with the expansion of the EU, creates good opportunities for growth of demand for energy-related services. The increasing EU legislation related to energy is driving demand for industry-specific management consulting services in the energy sector. Environmental legislation, especially legislation aimed at preventing climate change, continues to boost demand for renewable energy and plant refurbishment services. The high price of crude oil is creating new opportunities within the oil and gas sectors. In the thermal power sector, clients focus on diversifying their energy mix. The Energy business group's market position has improved further and its order stock is good. The business group's operating profit will improve significantly in 2007.
 
Forest Industry
 
Investment activity in the forest industry will remain relatively strong in emerging markets. Rising production costs continue to call for operational and productivity improvements in mature markets. Industry restructurings will increase demand for consulting and corporate restructuring services. Demand for biofuel and chemical industry engineering services will remain strong. The business group's order stock is good. The operating profit will improve significantly during 2007.
 
Infrastructure & Environment
 
The infrastructure and environment markets have improved especially in Central and Eastern Europe, where the recovery of national economies and EU financing have boosted investments in the public sector. Maintaining a local presence is becoming more important in emerging markets. Corporate acquisitions made during 2007 expand the supply of services within the business group's real estate business. The business group's order stock has remained good. The operating profit will improve clearly in 2007.
 
Group
 
The Group has a strong market position in all of its business areas. The order stock is good and has increased by EUR 76.1 million during the period under
 
review. Consolidated net sales will increase in 2007. Profit before taxes will improve significantly in 2007 and be EUR 72-77 million. This estimate can be negatively affected by the ongoing labour market negotiations in Finland.
 
 
Vantaa, Finland, October 29, 2007
 
PÖYRY PLC
Board of Directors
 
PÖYRY PLC
 
 
 
Erkki Pehu-Lehtonen
President and CEO
 
Teuvo Salminen
Deputy to President and CEO
 
Additional information by:
Erkki Pehu-Lehtonen, President and CEO, Pöyry Plc
tel. +358 10 33 22999, +358 400 468 084
Teuvo Salminen, Deputy to President and CEO, Pöyry Plc
tel. +358 10 33 22872, +358 400 420 285
Satu Perälampi, VP, Corporate Communications and Investor Relations, Pöyry Plc
tel. +358 10 33 23002, +358 40 526 3388
 
 
 
DISTRIBUTION:
OMX Nordic Exchange Helsinki
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