The publishing of Norske Skog's accounts for Q 3 2006 will take place on Friday, November 3rd at 8:00 CET.

 

A live webcast will be held from Norske Skog's offices at 13:00 CET the same day. More information about this event will be available on our web site www.norskeskog.com.  

 

The Silent Period ahead of the release commences on Monday, October 23rd.

 

In course of the quarter a valuation has been undertaken both of operational fixed assets that are depreciated (impairment testing), and of goodwill.  The valuation has been done according to generally accepted methods and in accordance with IAS 36.  Comparing to earlier valuations, new assumptions for newsprint prices in China and for the cost development of certain raw materials, have been made.

 

As a preliminary result of the valuations a write down of NOK 2.8 billion has been made.  This is related to the operations in China, coated magazine paper in Europe, goodwill relating to the acquisition of Fletcher in 2000 and certain other write downs.  In addition, and as previously announced, a write down of approximately NOK 400 mill. for PM 1 and 4 at Jeonju in Korea, and provision for NOK 600 million connected to the de-manning process in the group, has been made.  Most of this provision will be paid during 2007, while the other amounts mentioned above have no cash effect.

 

Write downs and provisions in Q 3 amounts to NOK 3.8 billion in total, with a net effect on earnings after tax of  NOK 3.2 billion.

 

NOK 1.7 billion part of the total write down is related to goodwill.  Following this the goodwill in the Norske Skog consolidated accounts will amount to NOK 2.8 billion, mainly related to the Australasian region.

 

 

Net P & L effects from change in the value of energy hedging related to Norske Skog's energy contracts are a loss of approximately NOK 100 million.

 

Norske Skog's trade-weighted basket of currencies (the "Norske Skog Index") had an average value of 88.3 in Q 3, 2006, compared to 85.9 in Q 2, 2006, and 86.6 in Q 3, 2005. The value as per September 30th, 2006, was 90.6 compared to 86.8 on June 30th, 2006. The index started Jan 1, 2002.

 

Oksenøen, October 19th, 2006

 

NORSKE SKOG

 

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