Powerflute : Modification of Proposals to the AGM

18 May 2016

POWERFLUTE OYJ

MODIFICATION OF PROPOSALS TO THE AGM

Powerflute Oyj ('Powerflute' or the 'Company') today announces that the Board of Directors has decided to modify its proposal to the Annual General Meeting to be held in Kuopio on 26 May 2016 (the 'AGM') in respect of the distribution of profits for the year ended 31 December 2015.

The amount of the distribution will remain unchanged at 3.00 cents per share and the record date for the proposed distribution will continue to be 3 June 2016, with payment made on or about 21 June 2016 as originally proposed. However, instead of payment of a dividend from retained earnings, the Board now proposes a return of capital from the invested non-restricted equity reserve of the Company which at 31 December 2015 was EUR 30,228,000.

Details of the modifications to the Board's proposals to the AGM will be available for download in English and Finnish from the Company's website (www.powerflute.com) from 18 May 2016.

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About Powerflute

Powerflute is a paper and packaging group quoted on the AIM market of the London Stock Exchange (Ticker: POWR)which seeks to acquire businesses with strong fundamentals whose performance can be improved through a combination of management focus and targeted investment.

The Group currently has two main activities; Packaging Paperswhich trades under the name Powerflute and operates a paper mill in Kuopio, Finland producing a specialised form of Nordic semi-chemical fluting used in the manufacture of high-performance corrugated board; and Coreboard and Cores, which trades under the name Corenso and is a leading international manufacturer of high performance coreboard and cores, with coreboard mills in the United States and Europe and a network of core producing facilities in Europe, North America and China.

Nordic semi-chemical fluting is made from locally sourced birch and boxes manufactured using it 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.

Cores and coreboard are manufactured from recycled paper and are used for applications in paper, packaging, textiles, steel, aluminium and many other industries. Coreboard and cores produced by Corenso demonstrate superior strength and rigidity and are suitable for use in the most demanding applications.

For further information, please visit www.powerflute.com.