Taking Stock
For instance, Alufoil (www.alufoil.com) is now offering new holographic foils in covers and weights. The company has also established an Internet presence in hopes of reaching more would-be paper consumers—already a trend among most vendors.
Raymond Royer, Domtar (www.domtar.com) president and CEO, puts a more positive spin on things: "The enthusiastic response of the financial markets…has enabled us to maintain a healthy balance sheet…The commitment by employees in our new mills to achieve the quality and service standards of our distribution network is remarkable, and has enabled us to achieve satisfying results, despite a hesitant market in all areas."
Westvaco (www.westvaco.com) Chairman and CEO John A. Lukes, estimates, "As we prepare[d] for our planned merger with Mead, we [were] highly focused on developing rigorous programs to achieve $325 million in synergies that we have targeted within two years. We are intent on generating higher earnings and higher returns on capital by building on the strong—and in many cases, complementary—businesses of Mead and Westvaco."
In the paper segment alone, which includes the company's envelope business, 2001 fourth quarter operating profits claimed $13.4 million, compared to $37.6 million in 2000. Segment results reflect weaker market conditions, especially in the autumn of 2001, when many buyers postponed or cancelled major printing projects. For Westvaco, these results also reflect market-related downtime of about 10,000 tons at the company's Luke, MD, and Wickliffe, KY, mills, as well as competition from imports, adds Lukes.
"The mill's workforce has aggressively confronted extremely challenging market conditions," champions James A. Buzzard, Westvaco executive vice president. "These efforts, however, can no longer overcome the competitive pressures caused by the economic slowdown, the strong U.S. dollar and the related sharp increase in imported paper. Today's circumstances dictate that we concentrate our production on the most efficient equipment."
