Sales in Stora Enso’s Building and Living division (including wood products) remained stable in the first quarter but further cost reductions will be implemented in the second quarter.

The division, which also includes solid biofuels, recorded sales of €381m compared to €382m in the preceding quarter. The sales were down 7% year-on-year.

Profits before tax and interest were up 63.3% to €9.8m compared to the preceding quarter but were down 16.9% on a year ago.

Deliveries totalled 1.1 million m³, down from 1.14 million m³ in the fourth quarter of 2011 and 7.5% lower than a year ago.

Stora Enso said lower sales volumes were partly offset by lower fixed costs.

Production curtailments implemented at its highest-cost mills to defend margins and manage inventory levels will continue during the second quarter if necessary, in response to the global construction industry slowdown.

Demand and pricing in the first quarter were described as “stable” compared to the previous three months.

The company’s new 60,000m3 capacity cross-laminated timber (CLT) factory in Ybbs, Austria started up on schedule and CLT solutions for urban multi-storey buildings are being promoted, predominantly in the Nordic markets. Stora Enso has another CLT production unit in Bad St Leonhard.

“Progress is being planned towards the long-term target of transforming the business from basic sawmilling to more value-added products and concepts, such as post and beam products, building solutions and industrial components,” it said.

The share of value-added products rose to 35% of end products sales, compared with 33% a year ago.