RICHMOND, VA – MeadWestvaco Corporation reported record second quarter income from continuing operations of $89 million, or $0.51 per share ($0.54 excluding special items), including record profit levels in Packaging Resources and Specialty Chemicals. The company increased sales by nine percent, with especially strong performance in emerging markets and higher pricing across most product lines. The company's strong results were driven by gains in global consumer packaging markets, including food, fragrance, and beverage markets outside North America, as well as pine chemicals for industrial markets around the world.

"MWV delivered another very strong performance during the second quarter," said John A. Luke, Jr., chairman and chief executive officer. "We are consistently generating higher sales and profits by executing specific, market-based strategies in our businesses – including a transformed product and geographic mix that has strengthened our earnings power. Even as some of the challenges we expected began to emerge in the second quarter, including uneven economic recovery in developed markets and input cost inflation, we continue to prove that the step change in our performance is sustainable."

Quarterly Comparison
Sales from continuing operations in the second quarter of 2011 increased nine percent to $1.56 billion from $1.43 billion in the second quarter of 2010. Income from continuing operations in the second quarter of 2011 was $89 million, or $0.51 per share. The 2011 results include after-tax restructuring charges of $5 million, or $0.03 per share. Income from continuing operations in the second quarter of 2010 was $56 million, or $0.32 per share. The 2010 results include after-tax restructuring charges of $10 million, or $0.06 per share.

Second Quarter Segment Results

Following is a summary of second quarter 2011 results by business segment. All comparisons for the second quarter of 2011 are with the second quarter of 2010 on a continuing operations basis.

Packaging Resources
(Includes high-quality packaging paperboard principally for global food and beverage, tobacco and commercial print markets as well as MWV Rigesa, a fully-integrated manufacturer of corrugated packaging solutions for produce, meat and consumer products markets in Brazil)

• 10% sales growth
• Unchanged volume
• 8% profit growth

In the Packaging Resources segment, profit increased to $99 million in the second quarter of 2011 compared to $72 million in the second quarter of 2010. Sales increased to $741 million in the second quarter of 2011 compared to $676 million in the second quarter of 2010.

The segment's sales increase was due to improved paperboard pricing and product mix across all end markets, especially global food, beverage, tobacco, liquid packaging and commercial print, as well as the favorable currency exchange impact of sales in Europe and Brazil. Pricing for solid bleached sulfate (SBS) paperboard and coated unbleached kraft (MWV name-brand CNK) both improved during the quarter. MWV Rigesa had increased sales of corrugated packaging solutions due to higher pricing and improved mix, as well as increased sales of consumer packaging solutions for beauty and personal care products.

Total shipments of paperboard packaging showed a modest increase. SBS paperboard shipments improved two percent with volume growth in food and liquid packaging offsetting deliberate actions to exit lower return product lines. Shipments of CNK paperboard declined two percent. Gains in food packaging and in beverage packaging in Asia and Europe were more than offset by beverage packaging declines in North America. MWV Rigesa's corrugated volumes moderated compared to unusually strong demand associated with Brazil's robust economic growth last year.

Profit growth in 2011 primarily reflects strong improvement in pricing and product mix across key product lines, favorable foreign currency exchange and improved manufacturing productivity. These benefits in 2011 were partially offset by input cost inflation for certain raw materials and freight.

Consumer Solutions
(Includes packaging for beverage, tobacco, personal care, home and garden and healthcare markets)

• 4% sales growth
• 3% volume decline
• 5% profit decline

In the Consumer Solutions segment, profit in the second quarter of 2011 was $36 million compared to $38 million in the second quarter of 2010. Sales increased to $505 million in the second quarter of 2011 compared to $486 million in the second quarter of 2010.

The segment's sales growth was due to favorable foreign currency exchange, pricing and product mix improvement and the addition of trigger sprayer business acquired with Spray Plast. Volume gains in tobacco packaging as well as pricing and product mix improvement in beverage, personal care and healthcare packaging contributed to sales growth. These gains were partially offset by weather-related volume declines in home and garden and in beverage packaging due to lower consumer consumption in North America.

Profit decline in 2011 primarily reflects input cost inflation, principally increased costs for resins and freight. These factors were partially offset by pricing and product mix improvement, productivity gains and favorable foreign currency exchange.

Consumer & Office Products
(Includes branded and licensed school supplies in North America and Brazil as well as office and planning and organizing products in North America)

• 7% sales growth
• 3% volume growth
• 21% profit growth

In the Consumer & Office Products segment, profit was $34 million in the second quarter of 2011 compared to $28 million in the second quarter of 2010. Sales increased to $182 million in the second quarter of 2011 compared to $170 million in the second quarter of 2010.

Higher volume was driven primarily by earlier shipments of North American back to school orders and early orders for time management products as some customers filled their seasonal merchandising plans. Tilibra, the segment's Brazilian operation, also had increased sales of branded proprietary products to its retail customers, which contributed to overall mix improvement for the business.
Profit growth in 2011 primarily reflects product mix improvement from the timing of branded product sales, continued productivity gains and favorable foreign currency exchange. These benefits were partially offset by input cost inflation for certain raw materials and freight. The segment continues to be impacted by imports from Asia.

Specialty Chemicals
(Includes chemicals for asphalt, oilfield, adhesives, inks and paper sizing, as well as activated carbon for auto emission controls and for food and water purification)

• 20% sales growth
• 2% volume growth
• 56% profit growth

In the Specialty Chemicals segment, profit increased to $56 million in the second quarter of 2011 compared to $36 million in the second quarter of 2010. Sales increased to $216 million in the second quarter of 2011 compared to $180 million in the second quarter of 2010.

Sales growth was driven by continued success in higher value markets for pine chemicals, asphalt and carbon technologies in both developed and emerging markets. The segment achieved strong volume in pine chemicals used in the production of publication inks, adhesives and oilfield drilling solutions. Sales in carbon technologies were up modestly due to product mix and price improvement. Volumes in automotive carbon decreased due to lower auto production levels in Japan due to impacts from the tsunami.

Profit growth in 2011 reflects product mix and pricing improvement and higher volumes across key pine chemicals product lines. These benefits in 2011 were partially offset by input cost inflation for certain raw materials and freight.

Community Development & Land Management
(Includes approximately 720,000 owned acres in Southeastern U.S. – pursuing small-tract land sales and development opportunities principally in the region of Charleston, SC)

In the Community Development and Land Management segment, profit was $6 million in the second quarter of 2011 compared to $12 million in the second quarter of 2010. The profit decline was due to lower rural tract land sales. Profit from real estate activities was $5 million in the second quarter of 2011 compared to $9 million in the second quarter of 2010. Profit from forestry operations and leasing activities was $1 million in the second quarter of 2011 compared to $3 million in the second quarter of 2010. Sales were $30 million in the second quarter of 2011 compared to $36 million in the second quarter of 2010. The segment sold approximately 4,700 acres for gross proceeds of approximately $11 million in the second quarter of 2011 compared to approximately 5,700 acres for gross proceeds of $15 million in the second quarter of 2010.

Other Items
In the second quarter of 2011, total pre-tax input costs of energy, raw materials and freight increased $40 million over the second quarter of 2010 on a continuing operations basis.

In the second quarter of 2011, the pre-tax impact from favorable foreign currency exchange was $17 million compared to the second quarter of 2010 on a continuing operations basis.

Operating cash flow from continuing operations improved to approximately $160 million in the second quarter of 2011 compared to $75 million in the second quarter of 2010, reflecting higher earnings and lower working capital usage.
Capital spending from continuing operations was $151 million in the second quarter of 2011 compared to $40 million in the second quarter of 2010. The year-over-year increase was driven primarily by the expansion of the company's corrugated packaging business in Brazil.

The company's U.S. qualified retirement plans remain over funded and management does not anticipate any required regulatory funding contributions to such plans in the foreseeable future.

The effective tax rate from continuing operations in the second quarter of 2011 was approximately 32 percent.

MWV paid a regular quarterly dividend of $0.25 per share during the second quarter of 2011. On June 28, 2011, MWV declared a regular quarterly dividend of $0.25 per common share. The payment of the dividend will be made on September 1, 2011, to shareholders of record at the close of business on August 1, 2011.

Outlook
In the third quarter of 2011, the company expects earnings to improve modestly compared to the third quarter of 2010. The company expects continued benefits from value-based pricing, product mix improvement and profitable growth in faster growing emerging markets. The company also expects continued gains in manufacturing productivity. The company remains cautious around ongoing macro-economic challenges in developed markets and the impact on consumer demand, higher costs for certain raw materials and freight, as well as the potential impact of policies in key emerging markets to control inflation. The company is also continuing to monitor fiscal developments, particularly in the U.S. and Europe, which could also impact consumer confidence.

Use of Non-GAAP Measures
The presentation of earnings per share from continuing operations, adjusted to exclude restructuring charges is not meant to be considered in isolation or as a substitute for earnings per share from continuing operations determined in accordance with generally accepted accounting principles ("GAAP"). The company believes this non-GAAP measure provides investors, potential investors, securities analysts and others with useful information to evaluate the performance of the business because it excludes charges that management believes are not indicative of the ongoing operating results of the business.

Conference Call
Investors may participate in the live conference call today at 10:00 a.m. EDT by dialing 1 (800) 230-1092 (toll-free domestic) or 1 (612) 332-0107 (international); passcode: MeadWestvaco. Please call to register at least 10 minutes before the conference call begins. The live conference call and presentation slides may be accessed on MWV's website at www.mwv.com. After connecting to the home page, go to the Investors page and look for the link to the webcast. Please go to the website at least 15 minutes prior to the call to register, download and install any necessary audio software. A replay of the call will be available for one month via the telephone starting at 12:00 p.m. EDT on July 27th, and can be accessed at 1 (800) 475-6701 (toll-free domestic) or 1 (320) 365-3844 (international); access code: 209106.