Jul 04, 2006. /Lesprom Network/. Finnish paper groups M-Real and UPM-Kymmene, both with paper mills in Austria, issued profit warnings for the second quarter of 2006, on July 3, 2006, APA reported. M-Real attributed its profit warning to higher production costs and fluctuation in the demand, based on seasonal factors. UPM said its profit structure was affected by costs related to a streamlining programme launched in early 2006 and by value adjustments of its forest properties. M-Real, owner of the paper mill in Hallein, Austria, posted a pre-tax loss of Euro 114 million for 2005. In the week ended June 30, 2006, the company announced the sale of its French subsidiary Pont Sainte Maxence to German Arques Industries. In Hallein, a total 100 of 800 jobs are threatened by a group-wide cost cutting programme. UPM plans to cut about 3 600 of its global staff of 31 500 within two years, mainly in Finland and France. This will include 20 jobs in the company's paper mill in Upper Austria, former Steyrermuehl. UPM's streamlining programme cost a total Euro 123 million in the second quarter of 2006.