Ian Melin-Jones
Metso to supply a pulp mill to Oji Paper to China
Metso will supply a greenfield kraft pulp mill to the Japanese Oji Paper Co. Ltd., to be built in Nantong City, Jiangsu Province, in the southern part of China. Start-up of the pulp mill is scheduled at the end of 2012. The value of the order will not be disclosed. A typical value of this type of a pulp mill ranges from EUR 100 to 150 million depending on the scope of the delivery. More than a half of the order was included in Paper and Fiber Technology’s Q2 orders received and the rest in Energy and Environmental Technology’s Q2 orders received.
Metso’s scope of supply covers all main process equipment for the new mill, including chip screens and storage systems, a continuous cooking system, a fiberline including wash presses, ozone bleaching, a wet lap machine, a recovery boiler, an evaporation system, a white liquor plant and a gas handling system. The state-of-the-art technology delivered by Metso will ensure environmentally friendly and efficient production.
The new pulp mill will produce 700,000 tonnes of bleached hardwood pulp annually and will be integrated with an existing paper machine at the Nantong mill.
The order emphasizes Metso’s strong capabilities as a full-scope supplier for the pulp and paper industry. In June 2010 Metso announced that Ilim Group contracted Metso to supply the main technology for a new 720,000 tonnes kraft pulp mill in Bratsk, Russia.
Oji Paper Co. Ltd., one of the world’s largest paper producers, manufactures paper, pulp, and processed paper goods, including newsprint, carbonless paper, wrapping and packaging paper, and paperboard. The new pulp mill in Nantong is a part of Oji´s strategy to promote business expansion in East Asia.
Metso is a global supplier of sustainable technology and services for mining, construction, power generation, automation, recycling and the pulp and paper industries. We have about 27,000 employees in more than 50 countries. www.metso.com
Further information for the press, please contact:
Lars Dahlqvist, Senior Vice President, Fiber Processing Unit, Fiber business line, Metso, tel. +46 70 606 80 90
Kari Remes, General Manager, Sales, Power business line, Metso, tel. +358 40 709 2015
Sonoco Names Weller Managing Director of Asia Operations; Other Asia, Australia Leadership Changes Announced
Sonoco, one of the largest diversified global packaging companies, announced that Brad Weller has been promoted to division vice president and managing director, Asia, with responsibility for all of Sonoco's industrial and consumer businesses throughout Asia. In this new position, Weller joins Sonoco's Management Committee and reports to John Colyer, vice president, Global Industrial Products, and Rodger Fuller, vice president, Global Rigid Paper and Closures.
Prior to this promotion, Weller was division general manager, Industrial Products, Asia. He will remain in Sonoco's Asia headquarters in Singapore. Weller will be responsible for Sonoco's industrial and consumer packaging operations in China, Indonesia, Malaysia, Singapore, Taiwan and Thailand.
Weller has 25 years of experience with Sonoco, serving in a number of management, marketing and sales leadership positions in the Industrial Products division in the United States, Europe and Asia. Brad received a B.A. degree from the University of South Carolina.
Ernest Yong has joined Sonoco as general manager, Consumer. In this position, Yong is focused on continuing to grow Sonoco's consumer packaging sales throughout Asia. He reports to Weller and is based in Singapore.
Prior to joining Sonoco, Yong was regional marketing and public relations manager for a large consumer products company's retail, portioned and accessories coffee business in Asia. In addition to management leadership, Yong was an external auditor for Ernst & Young in Singapore. He holds a B.S. degree in accounting from Nanyang Technological University, Singapore, and an advanced degree in marketing from the Marketing Institute of Singapore.
Mark Chenhall has been named managing director for Sonoco's industrial converting and consumer packaging businesses in Australia and New Zealand, reporting to Fuller. Chenhall joined Sonoco in 1987 and previously was general manager for Sonoco's industrial and consumer businesses in Australia. He also has held management positions in sales, marketing and operations in Australia.
About Sonoco
Founded in 1899, Sonoco is a $3.6 billion global manufacturer of industrial and consumer products and provider of packaging services, with more than 300 operations in 35 countries, serving customers in some 85 nations. Sonoco is a proud member of the Dow Jones Sustainability World Index. For more information on the Company, visit our Web site at www.sonoco.com
Matti Kähkönen appointed new President and CEO of Metso
The Board of Directors of Metso has appointed Mr. Matti Kähkönen, M.Sc. in Engineering, as the new President and Chief Executive Officer of Metso Corporation and Metso Group. Matti Kähkönen will start in his new position on March 1, 2011.
Matti Kähkönen (b. 1956) is currently President of Metso’s Mining and Construction Technology segment and he will continue in this position until assuming the duties of CEO of Metso. He has a long career at Metso, holding various management positions in the automation as well as the mining and construction technology businesses. He has been a member of the Metso Executive Team since 2001.
Chairman of the Board of Directors of Metso, Jukka Viinanen: "Matti Kähkönen has a strong track record with Metso. The latest achievement of Matti and his team has been the successful implementation of transforming Mining and Construction Technology segment’s way of operating to be more integrated and services driven. Matti is known for his open and straightforward management style, and I am certain that under his leadership Metso has excellent future for continuing the strategy of profitable growth”.
Matti Kähkönen comments:”I am really excited about this opportunity to start as CEO of Metso. Metso has several leading market positions and we are especially recognized for our technological know- how and our strong global presence. My goal is to ensure that Metso’s positive operational and financial development during the past few years will continue. I want to make sure that Metso is a competitive, truly global, services-oriented company with a strong focus on customer satisfaction and shareholder value creation”.
Metso’s current President and CEO Jorma Eloranta will continue in his position until March 1, 2011.
Metso is a global supplier of sustainable technology and services for mining, construction, power generation, automation, recycling and the pulp and paper industries. We have about 27,000 employees in more than 50 countries. www.metso.com
St. Marys Paper proposes autumn restart
St. Marys Paper Corp. has engaged Dennis Bunnell as chairman of the board and CEO to head up the plans to restart production at the St. Marys Paper mill in Sault Ste. Marie, Ont. The mill ceased production of groundwood pulp and paper in March of this year.
At that time the company indicated it would manage the shut down in order that paper production could continue when market and business conditions warrant.
"St Marys has used this period of curtailment to conduct an independent updated marketing and sales study and to evaluate the operational and capital changes needed to ensure long term cost competitiveness, says president Gord Acton. "Our goal continues to be to transition the business from simply a paper production facility to a paper production, green energy and bio-economy business."
Bunnell comments: "I am excited to join St. Marys team and believe that the biomass co-generation facility proposed to be built on St. Marys property, when combined with capital improvements in the mill, will ensure the long-term sustainability of the St. Marys business model."
"We have already commenced discussions with stakeholders concerning our plan. These talks will continue with the goal of restarting the paper mill as early as possible this fall. Our discussions with major stakeholders have been positive," says Bunnell.
He notes that Ontario's recently-announced energy conservation program is "one of the critical pieces of our business plan."
The company will solicit support for its new business plan over the coming weeks.
PAPER2011 To Bring Industry Together in Chicago
The American Forest & Paper Association (AF&PA) and the NPTA Alliance, joint hosts of the annual paper industry meeting, announced today that Paper2011 would be held in Chicago on March 27-29, 2011.
“Today’s changing economic demands and business climate have the entire paper industry taking a fresh look at how we position ourselves for continued growth in the future,” said AF&PA President and CEO Donna Harman. “Paper2011 will be the premier venue to have those discussions and the new location in Chicago will really enhance our efforts to foster a broader perspective on the industry.”
“Paper2011 in Chicago will bring representatives across the supply chain together in a new location,” said Newell Holt, CEO of NPTA. “This will be the one event in 2011 where leaders from across the industry can come together to discuss ways to advance their respective companies’ interest as well as that of our industry.”
Additional details about Paper2011 will be announced in subsequent releases. For more information as it is announced, go to www.paper2011.com.
# # #
About the American Forest & Paper Association (AF&PA): AF&PA is the national trade association of the forest products industry, representing pulp, paper, and wood products manufacturers, and forest landowners. AF&PA member companies make essential products from renewable and recyclable resources that sustain the environment. The forest products industry employs 1 million workers and generates 6 percent of the total U.S. manufacturing GDP. Visit AF&PA online at www.afandpa.org.
About the NPTA Alliance: NPTA Alliance (formerly the National Paper Trade Association, Inc.), founded in 1903, is the association for the $60+ billion paper, packaging, and supplies distribution industry. The mission of NPTA is to actively support the success of its members through the delivery networking, education, industry data and research and advocacy, which focuses on the health of the distribution channel. Visit the NPTA Alliance online at www.gonpta.com
Belarus Achieves PEFC Recognition
Following a comprehensive, in-depth assessment, PEFC International has endorsed the PEFC Scheme of the Republic of Belarus, providing responsible forest enterprises and managers in the Eastern European country with access to global markets for certified timber and timber products.
“With forests covering almost one-third of the total land area of Belarus, their responsible use is essential for the sustainable development of our Republic”, says Aleh Atroshchanka, Chairman of PEFC-Belarus. “While Belarus has been promoting sustainable forest management since gaining independence in 1991, it faced a number of challenges such as forest fires, pest, etc. In addition, some 1.6 million hectares of forest soil remain contamination by nuclear fallout. PEFC certification is therefore an important tool for us to promote sustainable forest management and to raise awareness for the need to balance the environmental, social and economic provisions that forests offer.”
The decision to establish a forest certification system in Belarus was already adopted in 1999 and national regulations on forest certification were approved in 2000. The regulations set the basic objectives, tasks, and requirements for forest certification and describe the organizational structure and functions of certification bodies. The Belarusian Association of Forest Certification System (RAFC),, which currently counts about 90 institutions and organizations as members, was established in 2005 and became PEFC member in the same year.
The PEFC Scheme of the Republic of Belarus was submitted to the PEFC Council for the conformity assessment in December 2007. In October 2008 the assessment was interrupted for the further Scheme amendments. The assessment restarted in December 2009 based on the revised Scheme documentation submitted to PEFC in April 2009 and amended in July 2009.
Note: The endorsement is only valid for the Bealrus forest management standard, not for the Belarus Chain of Custody standard. Only Chain of Custody certificates issued against the international PEFC Chain of Custody standard are PEFC recognized Chain of Custody certificates in Belarus.
Further Information
- Scheme Documentation (7.2 MB)
- Assessment Report (1.5 MB)
OTHER ONGOING PUBLIC CONSULTATIONS
- PEFC Uruguay (ends 26 September 2010)
- Sustainable Forestry Initative (ends 6 October 2010)
- MTCC - Malaysia (ends 17 October 2010)
Brødrene Hartmann A/S (DK) - Interim report for H1 2010
Revenue increased in the first six months of 2010, primarily due to developments in exchange rates. The '10 in 10' initiatives had the anticipated effect, volumes grew, and the product and price mix improved. The period was adversely affected by a slowdown in industrial packaging activities, increasing raw material prices and additional costs. As a result, operating profit for H1 2010 was lower than expected. As already announced, Hartmann has downgraded its expectations for its EBIT margin for 2010 to approximately 7%.
Peter Arndrup Poulsen, CEO, on the Group's performance in H1 2010:
We are pleased to see that our '10 in 10' initiatives produced the expected effects in H1 2010, and that volumes grew and our product and price mix improved. However, we were unfortunately also affected by increasing raw material prices, additional fixed costs and a slowdown in industrial packaging activities. As a result, our operating profit for H1 2010 was lower than expected.
On the outlook for 2010:
Having to downgrade our EBIT margin forecast for 2010 to approximately 7% prior to releasing our interim report for H1 2010 was unsatisfactory. The substantial increase in raw material prices, in particular, changed the picture. Fortunately, we can see that our many efficiency optimisation initiatives have produced the intended results so far, and that our underlying operations remain strong. We have thus established a solid basis for further growth.
Highlights
The Group reported consolidated revenue for Q2 2010 of DKK 326 million (2009: DKK 310 million) and an operating loss of DKK 7 million (2009: an operating profit of DKK 12 million). Hartmann's revenue for H1 2010 came to DKK 706 million (2009: DKK 675 million), and the Group generated an operating profit of DKK 31 million (2009: DKK 24 million) and achieved an EBIT margin of 4.3%.
The business area Europe reported revenue for Q2 2010 of DKK 256 million (2009: DKK 255 million) and an operating profit of DKK 7 million (2009: DKK 18 million). Revenue for H1 2010 was DKK 562 million (2009: DKK 555 million) and operating profit DKK 55 million (2009: DKK 44 million). The performance was positively affected by favourable developments in exchange rates, a slight increase in volumes, an improved product and price mix within egg packaging and the operational improvements implemented. The performance was adversely affected by a slowdown in industrial packaging activities, increasing raw material prices and additional costs.
The North American operations reported revenue for Q2 2010 of DKK 54 million (2009: DKK 41 million) and an operating profit of DKK 2 million (2009: an operating loss of DKK 2 million). Revenue for H1 2010 was DKK 107 million (2009: DKK 81 million) and the operating profit DKK 5 million (2009: an operating loss of DKK 3 million). This trend was primarily attributable to positive effects of developments in exchange rates and, to a lesser degree, to organic growth and an improvement of the product and price mix.
Hartmann's other business areas, including costs relating to group functions, generated revenue for Q2 2010 of DKK 16 million (2009: DKK 14 million) and an operating loss of DKK 17 million (2009: an operating loss of DKK 7 million). The other business areas reported revenue for H1 2010 of DKK 38 million (2009: DKK 38 million) and an operating loss of DKK 33 million (2009: an operating loss of DKK 20 million). The period was adversely affected by a number of additional costs incurred in connection with group functions, e.g. due to advancement of a number of planned, new strategic measures in addition to the '10 in 10' initiatives already being implemented.
As announced in company announcement no. 14/2010, Hartmann has downgraded its EBIT margin forecast for 2010 to approximately 7%, down from the previous forecast of approximately 10% (actual 2009: 5.7%). The revised EBIT margin corresponds to an expected operating profit for 2010 in the region of DKK 90-105 million against the original forecast of approximately DKK 140 million (actual 2009: DKK 79 million).
Brødrene Hartmann A/S
Peter Arndrup Poulsen
CEO
Mobile: +45 51 51 40 69
Congress and Paper Companies Covet 'Son of Black Liquor' Funds
The “Son of Black Liquor” tax credits will probably cost American taxpayers hundreds of millions, if not billions, of additional dollars, but Congress might grab the money without paper manufacturers getting a dime.
Seven publicly traded paper companies have estimated that they will net about $570 million from the IRS’ recent ruling that made black liquor eligible for Cellulosic Biofuel Producer credits (CBPC), reports the Press-Register of Mobile, Alabama. Leading the way are Weyerhaeuser with $240 million (pre-tax) and Domtar with $200 million.
The other 14 publicly traded producers of black liquor, including the largest (International Paper), have not released such projections, partly because of uncertainty about exactly what the June 28 ruling means. (See Pulp Manufacturers Scratching Their Heads Over Son of Black Liquor Ruling for more information about these uncertainties.)
Meanwhile, the IRS’ “generosity” toward companies that produce, and burn, black liquor as part of their pulp-making operations has caught the eye of Congress, writes Jeremiah Coder for Tax Analysts. “The agency’s administrative largesse appears to be prompting members of Congress to consider legislation to retroactively disallow biofuel credits for black liquor claims.”
Sen. Charles Grassley of Iowa, the ranking Republican of Iowa, has asked the Joint Committee on Taxation for a “revenue estimate” on such a move, Coder reports. That is significant in at least three ways:
1) JCT’s estimate of revenue (actually, avoided costs) from overturning the IRS ruling is “likely to immediately become an attractive add-on to any legislation in need of pay-fors,” Coder writes. In other words, Congress could use the savings to pay for a new program and claim that it is not increasing the federal deficit (though it would be, because no money has been budgeted to subsidize the use of black liquor).
2) The JCT blew a previous estimate regarding Son of Black Liquor, saying that disallowing CBPC credits for black liquor from 2010 forward would save only about $25 billion when it could have set the number at $50 billion or more. (See How Google Could Help the Democrats By Buying a Pulp Mill and Black Liquor Bonanza: Earnings Exceeding Projections of Experts and Congress for details.) Congress certainly won’t be happy if the JCT low-balls this opportunity to create some funny money, this time by blocking the issuance of CBPC credits for black liquor used in 2009.
3) To back up its calculation, the JCT may reveal how much was paid out to paper companies from the original black liquor tax credit program. The 21 publicly traded companies reported receiving $6.5 billion from that program, but some big pulp makers like Georgia Pacific are privately held and therefore do not have to real what they received.
The JCT will also need to take a stab at some questions that are bedeviling the pulp makers about how to interpret the IRS ruling. Here’s a look at recent statements from some of the companies about those questions and how Son of Black Liquor might affect them:
- Weyerhaeuser (CFO Patricia Bedient): “During the first part of 2009, we produced approximately 238 million gallons of black liquor, which did not qualify for the alternative fuel mixture credit. This equals $240 million of potential cellulosic biofuel credit at $1.01 per gallon, or $149 million net of tax. Since this credit offsets income tax liability, we could only carry the credit forward. It is still unclear whether the credit can be claimed in the same year as the alternative fuel mixture credit [the original black liquor tax credit]. For the last three quarters of 2009, we claimed $344 million of fuel mixture credit. There's a great deal of uncertainty as to the process for claiming these credits and we are evaluating both credits to determine which credit or mix of credits, if allowed, would add the most value to the company.”
- Domtar: "From January 1, 2009 until we started to claim the Alternative Fuel Tax Credits, we have approximately 200 million gallons of black liquor that may qualify for this CBPC that would represent approximately $200 million of CBPC or approximately $120 million of after tax benefit to the Corporation. In July 2010, we submitted an application with the IRS to be registered for the CBPC. There is, however, a degree of uncertainty related to this credit as we have not received our registration for the credit and we believe there is some lack of clarity with the application of the IRS rules. As such, during the period ended June 30, 2010, we have not recorded any impact related to the CBPC."
- Graphic Packaging Corp. (CFO Dan Blount): “It appears that some in the industry are considering the cellulosic biofuel credit path. We have evaluated this approach. And given our large NOL [net operating loss] position and the fact that the cellulosic biofuel credit can only be used to offset federal income taxes payable, we will not be pursuing this option.”
- Smurfit-Stone (which recently emerged from bankruptcy protection): “Cellulosic biofuel producer credits unlikely to be utilized/relevant.”
- Kapstone Paper & Packaging: "In December 2009, the Company filed its registration as a cellulosic biofuel producer for the year 2009 and is awaiting approval. ..The IRS is expected to provide guidance for converting AFTC’s to cellulosic credits for qualifying producers. … At this time, the Company estimates a $22 million potential future after-tax credit for CBTC relating to black liquor burned in 2009 prior to the Company’s AFTC registrations being approved. If the Company were to receive any tax credits related to cellulosic biofuel it would be realized by reducing income tax payable beginning in late 2010."
- Packaging Corp. of America: "As a result of the IRS guidance, PCA has filed an application to receive the required registration code to claim the cellulosic biofuel producer credit. We expect this registration to be received during the third quarter. PCA has not yet filed a claim for any black liquor credits earned in 2009, since our tax -- 2009 tax return is not due until September 15, 2010. Once the cellulosic biofuel registration is received, PCA can claim the cellulosic biofuel producer credit of $1.01 per gallon instead of the alternative fuel mixture credit of $0.50 per gallon. This would increase our total 2008 and 2009 tax credits to about $370 million or $230 million after-tax, compared to alternative fuel mixture credits of $195 million or a $45 million increase."
AbitibiBowater Announces Intention to Withdraw NAFTA Notice of Arbitration
AbitibiBowater today announced a formal settlement agreement with the Government of Canada with regards to its assets and rights in Newfoundland and Labrador, Canada, expropriated by the provincial government under Bill 75 in December 2008. The Government of Canada will pay AbitibiBowater C$130 million, representing not more than the fair market value of those rights and assets, following the Company's emergence from creditor protection.
As part of the settlement agreement AbitibiBowater will waive its legal actions and claims against the Government of Canada under the North American Free Trade Agreement (NAFTA).
"We believe this is an acceptable settlement for our Company, stakeholders and creditors, given the set of circumstances faced by the Company at this particular time as well as the inherent uncertainty of any judicial process," stated David J. Paterson, President and Chief Executive Officer. "We are now able to move forward and focus on finalizing our restructuring process and plans to emerge from creditor protection in the fall 2010."
"AbitibiBowater would like to thank the Government of Canada for its efforts to reach this settlement and avoid a protracted and expensive NAFTA case. We look forward to continuing our strong working relationships with Canada and contributing to the country's economic, social and sustainable development," concluded Paterson.
The settlement agreement is conditional upon AbitibiBowater obtaining the approval of its terms by the Superior Court of Quebec in the CCAA proceedings and by the U.S. court in the chapter 11 bankruptcy proceedings as well as court approvals in the U.S. and Canada of AbitibiBowater's restructuring plans. Following emergence, the settlement payment will be paid to the new Canadian entity.
AbitibiBowater produces a wide range of newsprint, commercial printing and packaging papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 19 pulp and paper facilities and 24 wood products facilities located in the United States, Canada and South Korea. Marketing its products in more than 70 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade over-the-counter on the Pink Sheets and on the OTC Bulletin Board under the stock symbol ABWTQ.
Stora Enso divests real estate at Baienfurt in Germany
Stora Enso Baienfurt GmbH has signed an agreement to divest its Baienfurt mill site real estate in Germany. Buyer is the IGV Industrie- und Gewerbeverwaltungs GmbH, a subsidiary of the Lower Bavarian Karl- Gruppe, which specialises in acquiring and restructuring industrial sites. The transaction includes the land and buildings of the former Baienfurt cartonboard mill except the sheeting centre and the board machine. Following the divestment, Stora Enso will release approximately EUR 45 million of environmental and dismantling provision in the third quarter of 2010 as a positive non-recurring item. The transaction is expected to be completed by the end of the third quarter of 2010.
According to Karl-Gruppe's current plans, the mill site will be developed as a business/industrial park utilising existing buildings as well as erection of new commercial properties. The site will no longer be used for cartonboard production.
Cartonboard production at Baienfurt Mill ended in December 2008. Baienfurt Mill, which was part of Stora Enso's Consumer Board segment, had an annual capacity of 190 000 tonnes of folding boxboard.
For further information, please contact:
Bernd Rettig, EVP, Country Manager Germany, tel. +49 211 581 2310
Päivi Kauhanen, Communications Director, tel. +358 50 598 9560
Ulla Paajanen-Sainio, Head of Investor Relations, tel. +358 2046 21242