International Paper (NYSE: IP) has announced that it will donate over 8,100 acres of land, which includes the Bussey Brake and Wham Brake reservoirs, to the Louisiana Department of Wildlife and Fisheries(LDWF).  The total donation is valued at over $7.8 million. The fresh water reservoirs located near Bastrop, Louisiana in Morehouse Parish are popular recreational sites.

"This donation by International Paper will preserve these reservoirs for future generations to come for the citizens of Louisiana," said Tommy Joseph, International Paper Senior Vice President. "We are excited to be able to make this announcement today."

"Preserving fish and game habitat for public use is a key component in the department's conservation mission," said LDWF Secretary Robert Barham.  "IP's generous donation falls right in line with our public access initiatives."

Bussey Brake, a 2,600-acre fresh water reservoir, was constructed in the mid 1950's by International Paper to serve as an alternative water source for the Louisiana Mill. International Paper owned 620 acres of the reservoir site with the remaining balance under leases with third parties. Under terms of the donation, the leases will be transferred to LDWF.

LDWF plans for Bussey Brake include a complete renovation of the reservoir's fish population.  The impoundment will be drained and allowed to dry completely.  The current fish population will be removed and the reservoir stocked with popular game fish including bass, bream, catfish and crappie. Once re-stocked, the reservoir will be monitored and managed with recreational fisheries a priority.  The renovation process will take three to five years to achieve success and the resulting fish population, once established, would self-sustain as healthy fisheries for several decades.

Wham Brake was also constructed in the 1950's on IP lands though a joint effort with the U.S. Army Corp of Engineers. The 5,550-acre reservoir will become part of the (21,948 acre) LDWF's Russell-Sage Wildlife Management Area, providing preservation of wildlife habitat for future generations. LDWF will partner with Ducks Unlimited to initiate a hydrologic survey of Wham Brake to determine a management strategy for this vitally important waterfowl area. Planned site improvements include better hunter access through additional boat launches and parking areas, improved water delivery systems and more uniform moist soil management units creating added acres of waterfowl habitat.  

SOURCE International Paper

Andrea K. Tarbox, CFO of KapStone Paper and Packaging Corporation (NYSE: KS) ("KapStone") has been awarded 2012 Chicago CFO of the year by the Financial Executives International (FEI) Chicago Chapter. 

Chicago CFO of the Year® Awards are presented to senior financial leaders and recognize exceptional performance of financial professionals in their roles as corporate stewards in five categories: large public company, mid-size public company, large private company, mid-size private company and not-for-profit organizations.  

Tarbox, winner in the mid-size public company category, stated, "I consider this a KapStone win.  I am fortunate to have an extraordinary team who were adventurous enough to join the fledgling company and then to execute brilliantly in their areas of expertise."

Roger Stone, KapStone's Chairman and CEO, commented, "In many ways, Andrea is in a class all by herself.  She joined KapStone when it was in formation and she was our only financial employee.  She quickly recruited and built a talented and effective organization.  As the company grew, she integrated our acquisitions and created a cohesive, committed, and motivated group."

Tarbox joined the company in 2006.  KapStone has since grown from $0 in revenue to its current annual run-rate of well over $1 billion. Tarbox's previous career includes financial positions of increasing responsibility in several global companies including Gartner, British Petroleum and Fortune Brands.  Her career began with Ernst & Young.  Andrea earned a BA in psychology from Connecticut College and an MBA from theUniversity of Rhode Island.

SOURCE KapStone Paper and Packaging Corporation

Södra Cell Mörrum enhances process management in kraft pulping with new Metso Kappa Q analyzers.

Metso has delivered a second order for a large Kappa Q analyzer unit to Södra's Mörrum plant. The delivered analyzer replaces Mörrum's retiring Metso Kappa analyzers after a long service of over fifteen years. The new analyzer includes the online Kappa and Brightness measurements and, as a new feature to the previous ones, online Fiber and Shives measurements. The fiber properties measurements open a new door to even tighter pulp quality and process control through the whole fiber line from cooking to baling.

"The start up was successful and now the production has got an additional strong tool to improve both quality and capacity. Metso's way of managing and running things for the installation and start up is very professional," says Project Manager Sigurd Björkman, Södra Cell Mörrum.

A first order for a new Metso Kappa Q analyzer was placed in May 2011 to replace the existing analyzer installations. The analyzer had two cabinets both with separate washing and measuring chambers. One of the cabinets was equipped with brightness and the other with kappa and brightness measurements. Additionally, there was online fiber and shive measurement for all process sampling locations.

Södra Cell Mörrum mill is a Nordic pioneer in using Metso Kappa and Brightness analyzers as the key online measurements to manage kraft pulping in producing high quality pulp for global markets. The Mörrum mill purchased their first Kappa analyzer from Metso over fifteen years ago, and Mörrum's impact on solutions development of the online brightness analyzer, in cooperation with Metso in the mid-nineteen-nineties, was substantial. During their lifecycle, the analyzers carried out altogether 4.5 million measurements. After well over a decade's usage of two Kappa analyzers and a Brightness analyzer the mill decided to gradually replace the old analyzers with recently released modern Metso Kappa Q technology.

The Södra Cell Mörrum mill has several other Metso analyzers and sensor installations, such as Metso Alkali analyzers in the caustification plant and different versions of Cormec and Polarox inline-measurements of pulp brightness and residual chemicals.

Södra Cell Mörrum is a leading paper pulp producer in the world and part of the Södra company. Annually, Södra Cell produces 360,000 tons of pulp of which 87% is exported.

Lenzing AG, global market leader in the production of man-made cellulose fibers, has successfully issued and placed a German Private Placement (Schuldschein) to the amount of EUR 200 mn (senior debt, unsecured) on the debt capital market. Lenzing AG was able to attain an extremely favorable interest rate of 2.55%, with an average term to maturity of six years. Moreover, the transaction was multiple times oversubscribed compared to the original offering. The German Private Placement (Schuldschein) was offered with a term to maturity of four and seven years respectively, in each case at fixed and variable interest rates, as well as with a term to maturity of ten years but only at a fixed interest rate.

“Following the issuance of a corporate bond in 2010 and the capital increase within the context of the Re-IPO 2011, we want to take advantage of a further asset class for financing purposes on behalf of the Lenzing Group. Thus we are implementing the diversification of Group financing, especially as it is possible to optimally add further tranches in the future to the existing German Private Placement”, says Lenzing Chief Financial Officer Thomas G. Winkler.

The Lenzing Group currently has a strategic liquidity reserve of about EUR 353 mn at its disposal (cash and cash equivalents as well as short term securities). In addition, Lenzing can draw upon unused lines of credit to the amount of over EUR 200 mn. The issued German Private Placement (Schuldschein), which increases the level of  liquidity by  EUR 200 mn, takes advantage of  the favorable market situation at present, with a historically low EURIBOR interest rate, in order to safeguard the financing of Lenzing’s dynamic expansion drive over a period of up to ten years.

Resolute Forest Products has reported net income of $31 million for the third quarter, or $0.32 per diluted share, on sales of $1.2 billion. This compares with a net loss of $44 million, or $(0.46) per share, on sales of $1.2 billion in the third quarter of 2011.

Excluding $24 million of special items described below, net income for the quarter was $7 million, or $0.07 per diluted share. Net income excluding special items for the third quarter of 2011 was $50 million, or $0.50 per diluted share.

Special items incurred in the third quarter of 2012, net of tax, included:

• $21 million non-cash gain on translation of Canadian dollar net monetary assets
• $6 million non-cash credit related to reorganization-related and other tax adjustments
• $4 million charge related to start-up costs at the Dolbeau mill
• $3 million gain on disposition of assets
• $3 million charge related to closure costs, impairment and other related charges
• $2 million income from other items
• $1 million charge for post-emergence costs

Special items incurred in the third quarter of 2011, net of tax, included:

• $69 million non-cash charge on translation of Canadian dollar net monetary assets
• $14 million charge related to closure costs, impairment and other related assets
• $9 million charge for post-emergence costs
• $4 million severance charge
• $3 million income from other items
• $1 million loss on disposition of assets

Adjusted EBITDA of $91 million in the quarter compares with $120 million in the second quarter and $150 million in the third quarter of 2011.

Non-GAAP financial measures, such as adjustments for special items and adjusted EBITDA, are reconciled below.

THIRD QUARTER OPERATING INCOME VARIANCE

Operating income for the third quarter was $26 million, compared to $72 million in the third quarter of 2011.  The most significant components of the $46 million variance include: a volume decline for $51 million as a result of the Company reducing its exposure to newsprint export markets pressured by the strong U.S. dollar, its ongoing asset optimization efforts and a temporary but unexpected drop in September lumber shipments.  The lower average Canadian dollar this quarter provided a $7 million cost advantage.  The Company's asset optimization and restructuring initiatives, as well as more favorable pricing for recovered paper, power and natural gas, led to savings of $13 million in overall input costs, despite $6 million of costs associated with the annual outage at our Fort Frances pulp mill, last taken in the second quarter of 2011.  In addition, there was a $10 million unfavorable impact for the annual maintenance and necessary work to improve the operational and environmental performance of the recently acquired St. Felicien mill.  While the stronger pricing in wood products offset weak conditions in the market pulp segment, price eroded $9 million of operating income in paper grades, mostly in the coated papers segment.

"We're pleased with these results, considering the specific challenges we faced in the quarter and the unexpected extent of the maintenance required to bring our recently acquired St. Felicien mill up to par," said Richard Garneau, president and chief executive officer. "Our cost-focused strategy allowed us to maintain attractive margins in the paper and wood products segments despite lower shipments overall. This is the direct result of our focus on the items we control: selling only profitable tons and maintaining world-class operational standards." 

SEGMENT DETAILS

Newsprint

The newsprint segment generated operating income of $26 million, a $6 million decrease from the second quarter of 2012.  Average transaction price remained stable, but there was a 3% reduction in shipments as the Company continued to minimize its exposure to certain challenging export markets and took an outage for a capital improvement project.  Continued asset optimization efforts kept operating costs per unit in line, despite the stronger Canadian dollar and lower volume.

Coated Papers

Operating income in the coated papers segment was $1 million lower in the third quarter than the second, at $3 million.  Average transaction price rose $10 per short ton, but shipments were down over 10% as a result of the June 30 idling of a paper machine at the Catawba mill, part of the Company's ongoing asset optimization efforts.  The lost volume was largely offset by labor cost reductions from these restructuring initiatives, as well as lower maintenance and chemical costs.

Specialty Papers

The specialty papers segment generated operating income of $26 million, a $1 million decrease from the previous quarter.  Improvements to input costs, mainly lower labor costs from various mill efficiency initiatives, largely offset the stronger Canadian dollar and a 4% reduction in shipments, the result of softer demand and a capital improvement project outage.  Pricing remained stable, helping to deliver the second consecutive quarter of adjusted EBITDA of approximately $100 per short ton shipped.

Market Pulp

Operating loss in the market pulp segment was $22 million, compared to $7 million in the previous quarter.  Fibrek's results decreased by $17 million compared to the second quarter, mainly as a result of lost production and costs associated with the St. Felicien mill's previously announced five week outage for annual maintenance and necessary work to improve its environmental performance.  Average transaction price remained weak, falling another 1%, but shipments climbed 12%, reflecting three months of volume from Fibrek's two recycled bleached kraft pulp mills, compared to only two months in the previous quarter, and a 10,000 metric ton improvement in Resolute shipments as a result of less maintenance. The Company took 109,000 metric tons of downtime during the quarter, including the St. Felicien outage, a cold outage at Thunder Bay, market slowback at the two recycled bleached kraft pulp mills and extended downtime at the Coosa Pines fluff pulp mill.

Wood Products

The wood products segment reported operating income of $6 million in the third quarter, $6 million lower than the second.  Continued improvements to North American housing starts led to a 9% increase to average transaction price, but shipments fell 11% as a result of a drop in September lumber shipments.  Costs increased because of higher log costs and higher transportation costs.

CORPORATE & FINANCE

The Company used cash on hand to repurchase 2,609,680 shares of common stock during the quarter, at a total cost of $33 million, and to repay $97 million of Fibrek's debt.  With $343 million of cash, the Company ended the quarter with $872 million of available liquidity, and $282 million in net debt, up from $212 million at the end of the second quarter.

As previously announced, on October 10, Resolute redeemed $85 million of its 10.25% senior secured notes due 2018, using cash on hand.  The aggregate face amount of the notes is now approximately $500 million.

The Company is pleased that Standard & Poor's Ratings Services recently affirmed its long-term corporate credit rating (BB-, stable) and upgraded the issue-level rating on the senior secured notes to BB.

OUTLOOK

Mr. Garneau added: "we expect North American newsprint pricing to remain stable in the near term, as we've yet to feel the impact of capacity restarts.  We will, however, continue to manage our exposure to export markets where the relative strength of the U.S. dollar has created difficult conditions for North American producers.  We are making concrete progress toward our goal of generating more profit from the coated papers segment by optimizing the Catawba assets.  We expect the results to start showing in the coming quarters, as we plan to run full on the remaining capacity.  While demand in the specialty segment is under pressure, we believe that our Dolbeau facility will improve our overall competitive position.  With our focus on running for profit and not for tons, we will continue to manage our capacity as we've done in the last 12 months, assessing our network of mills to ensure that we produce only the tons our customers order.  As challenging conditions persist in the pulp segment, the timing of any meaningful improvement continues to be uncertain.  We will nonetheless benefit from growing external power sales at the St. Felicien facility, though the effects may not be fully seen until we complete the balance of needed repairs over the next two quarters.  We expect pricing in the wood products segment to remain near the higher levels we experienced recently as a result of positive momentum building in U.S. housing starts." 

SOURCE: RESOLUTE FOREST PRODUCTS INC.

SCA – the hygiene and forest company – is holding a CMD in Stockholm. The Group-wide financial targets and strategy remains with a focus on efficiency, innovation, growth and sustainability. The target for return on capital employed for Tissue and Forest Products has been adjusted. In recent years, SCA has completed hygiene acquisitions and divested for example the packaging operations. In order to further strengthen profitability in the hygiene operations, measures are initiated for decreased costs and improved efficiency.

SCA is undergoing a major transformation and restructuring, and retains its Group-wide financial targets: a 13% return on capital employed (ROCE) over a business cycle, a debt/equity ratio of 0.70 and a debt-payment capacity of 35%. The dividend policy is to pay out one-third of cash flow from current operations. The ROCE target has been revised from 13% to 15% for Tissue and, for Forest Products, from 11% to being in the top quartile of the sector.

The integration of the European tissue operations acquired from Georgia-Pacific is progressing in line with or better than planned, and is expected to provide EUR 125m in annual cost synergies, with full effect after three years.

“Our efficiency program from 2011 goes according to plan and to date we have achieved more than half of the expected annual savings of EUR 80m. A new efficiency program has been initiated within the hygiene operations to further reduce costs and increase productivity. It will provide annual cost savings of some EUR 300m, with full impact in 2015. About 1,500 employees are affected and costs are expected to some EUR 100m,” says Jan Johansson, President and CEO.

During the past year, SCA completed a number of major acquisitions and divestments, which has strengthened the company and focused operations on hygiene and forest products. The hygiene operations currently accounts for 80% of SCA’s sales, with the majority in Europe, but with increasing exposure to emerging markets, both via organic growth and acquisitions. Increasing disposable income in emerging markets offers continuing favourable conditions for growth in the hygiene operations.

“We have seen great innovation progress with successful examples such as the Tork Xpressnap napkin dispenser and the TENA Belt incontinence product,” notes Jan Johansson.

­“We have taken several steps to sharpen the focus of forest products operations on high value added products, most lately with the rebuild of a paper machine in Ortviken and the disposal of SCA’s shareholding in the UK-based Aylesford paper mill. We are also continuing to take steps in decreasing costs and making our production more environmentally friendly, most recently with the investment in a biofuel lime kiln at the Munksund kraftliner mill.”

Resolute Forest Products released its Sustainability Report for 2011 Performance, detailing Company efforts to balance environmental, social and economic considerations. The report also publicly introduces Resolute's first company-wide sustainability strategy which has three primary areas of focus:

• Reinforce Resolute's environmental credentials, taking appropriate steps to responsibly manage its environmental footprint;
• Position the Company as a competitive employer, attracting and retaining employees based on opportunities to quickly learn and grow within a dynamic organization; and
• Build solid community relations in Resolute's operating locations, recognizing that economically viable and civically involved companies support long-term regional prosperity.

"Over the past year, we have worked hard to deliver on the sustainability commitments we have made, and meaningful progress was achieved," said Richard Garneau, President and Chief Executive Officer. "As we move forward and implement our new sustainability strategy, we recognize the value of engaging our employees and stakeholders in raising the bar on our sustainability performance."

Resolute's key sustainability accomplishments outlined in the report include:

• Becoming a member in the World Wildlife Fund's prestigious Climate Savers program, which helps companies set and achieve ambitious emission reduction targets. In 2011, the Company reduced its GHG emissions by 6% from 2010 levels, a 62% decrease versus 2000 levels.
• Increasing efforts to certify more Company-managed woodlands operations through the Forest Stewardship Council^® (FSC) Sustainable Forest Management standard, leading to the Company becoming the world's largest manager of FSC-certified forests in 2012.
• Creating a management-level sustainability committee which prepared and is responsible for implementing Resolute's new corporate sustainability strategy.
• Completing a major life-cycle assessment of the Company's eco-friendly family of papers in 2011. These papers were launched in 2012 under the Align™ brand name.

New and continuing sustainability commitments for Resolute include:

• Fiber Sourcing: Increasing FSC forest certification of managed forests from 18% in 2010 to 80% by 2015. Resolute has now certified 51% of its forests to FSC standards and continues to progress towards this target.
• Water: Improving the Company's understanding of its water footprint and voluntarily reporting to the Carbon Disclosure Project's Water Disclosure program.
• Climate Change: Achieving a 65% absolute reduction in scope 1 and 2 greenhouse gas (GHG) emissions by 2015 over the 2000 base year.
• Health and Safety: Achieving an Occupational Safety and Health Administration (OSHA) incident rate of 1.2 or below in 2012, with a long-term goal of zero incidents, zero injuries.
• Communities: Establishing information-sharing community groups by the end of 2013 at Company operations to further enhance community relations efforts.
• First Nations: Drafting a formal Company policy on First Nations relations in 2012.

Resolute's sustainability report for 2011 performance was prepared using the Global Reporting Initiative (GRI) G3.1 guidelines, one of the world's most broadly accepted standards for transparent sustainability reporting. GRI's voluntary reporting guidelines are endorsed by the United Nations Global Compact and used by over 1000 organizations worldwide. Resolute is reporting at the "B" level as defined by GRI guidelines. This is the Company's second GRI-compliant report.

For a copy of the report and for more information on Resolute Forest Products' approach to sustainability, visit the Company's website at www.resolutefp.com/sustainability.

SOURCE: RESOLUTE FOREST PRODUCTS INC.

Metsä Board Corporation, a part of Metsä Group, divested on 3 May 2012 a 7.3 percentage point shareholding in Metsä Fibre Oy to Japan-based Itochu Corporation for EUR 138 million. At the same time Metsäliitto Cooperative, divested 17.6 percentage points of their holding in Metsä Fibre to Itochu. Metsä Board’s parent entity Metsäliitto had exercised on 24 April 2012 its call option pursuant to an amendment to the shareholders’ agreement to purchase the UPM-Kymmene Corporation’s 11 percentage holding in Metsä Fibre.

UPM has today initiated arbitration proceedings in which it claims jointly from Metsäliitto and Metsä Board primarily EUR 58.5 million in damages and secondarily to return an EUR 58.5 million claimed unjust enrichment. The claims are based on an alleged breach of the tag-along clause specified in Metsä Fibre’s shareholder agreement signed in 2009.

Metsä Board considers UPM’s claim to be unfounded in its entirety and will not book provisions related to this claim. The claim does not have an effect on the Itochu transaction or on Metsä Board’s cooperation with Itochu and it is not based on agreements made with Itochu. 

The dispute initiated by UPM will be processed in a court of arbitration and the outcome will be announced later on.

METSÄ BOARD CORPORATION