Jan. 2006 — Outokumpu Group recently concluded its consultations with employees and unions regarding the company’s fixed cost reduction program. The fixed cost reduction program was announced on September 26, 2005 with the target to reduce the Group’s fixed costs by 10% in each stainless business unit, Corporate Management and Group functions.

Some half of the fixed cost reduction is coming from costs other than personnel. The total reduction in the Group’s personnel, by the end of 2006, will be 796 employees. The total includes lay-offs, retirements and terminations of fixed-term contracts. The total reduction of personnel in Finland is 314, in Sweden 349 and in other countries 133. The effect in some of the larger business units is as follows:

• Tornio Works — 192
• Outokumpu Stainless Tubular Products (OSTP) including closure of the Sorsakoski tube mill — 64
• Corporate Management and Group functions — 58
• Avesta Works — 130
• OSTP Sweden — 90
• Degerfors — 61
• Thin Strip — 36

The Group-level reduction will be some EUR 100 million annually, as targeted. Reduced fixed-cost running rates will be in place during the second half of 2006, with full effect achieved in 2007. The amount of non-recurring costs to be booked in the fourth quarter 2005 results from the fixed cost reduction program is some EUR 30 million.