Wausau-Mosinee Paper Corporation Announces Fourth-Quarter Results
Press release from the issuing company
MOSINEE, Wis.--Jan. 28, 2004-- Wausau-Mosinee Paper Corporation today reported fourth-quarter earnings of $5.3 million, or $0.10 per share, compared with $6.4 million, or $0.12 per share, in the fourth quarter of 2002. Net sales were $239.3 million, increasing 2 percent from $233.8 million last year. Shipments increased to 207,000 tons in the current quarter from 203,000 tons in the year-ago period.
Net earnings for the year were $15.9 million, or $0.31 per share, compared with $23.1 million, or $0.45 per share, in 2002. Net sales were $971.4 million in 2003, compared with $948.7 million in 2002, and shipments increased 2 percent to 845,000 tons from 832,000 tons last year.
"Despite extremely challenging market conditions, Wausau-Mosinee achieved significant progress in 2003," explained Thomas J. Howatt, president and CEO. "We gained market share in each of our three businesses, increased overall volume, and improved productivity while substantially reducing costs. Net sales and shipments were up in all three of our business segments, and both Specialty Paper and Towel & Tissue reported increased operating profits.
"We attribute our progress to the success of our internal initiatives - new-product development, operational excellence, and benchmark service to our customers," continued Mr. Howatt. "Approximately 34 percent of our revenue came from products developed within the last three years, exceeding our goal of 25 percent; we improved mill efficiencies by 1 percentage point; cost reductions exceeded our target of 2 percent of 2002 cost of sales; and we implemented several customer service enhancements designed to sustain our reputation for providing industry-leading service in our markets.
"Our success in these areas enabled us to substantially offset higher energy and pulp costs, which had a negative impact of $0.44 per share. As a result, earnings decreased just $0.14 per share from 2002."
Commenting on fourth-quarter results, Mr. Howatt noted that Specialty Paper posted its sixth consecutive quarter of profitability and year-over-year improvement. Operating profits rose to $2.6 million from $1.9 million the year before. "Our new-product development and cost-reduction efforts are transforming Specialty Paper into a solid profit contributor," said Mr. Howatt.
Printing & Writing's operating profits declined to $3.4 million from $8.3 million in the year-ago period, due primarily to market pulp and energy cost increases and reduced product selling prices. "Printing & Writing results reflect the dramatic contraction in uncoated freesheet margins in 2003, as market demand declined for a fourth consecutive year while fiber and energy costs increased rapidly. Despite these circumstances, we experienced significant gains in target markets such as consumer products, which posted a 21 percent increase in shipments for the fourth quarter and a 24 percent increase for the full year," said Mr. Howatt.
Towel & Tissue's fourth-quarter operating profits increased 35 percent to $8.7 million from $6.4 million a year earlier. "While the 'away-from-home' segment of the towel and tissue market grew 2 percent for the quarter, our shipments of higher-margin proprietary products increased 8 percent," Mr. Howatt reported. "This growth, combined with strong cost-reduction results, has fueled our improved profitability."
Commenting on the outlook for 2004, Mr. Howatt said, "Most segments of the paper industry continue to lag the recent economic recovery. As a result, we believe our ability to achieve improved results in 2004 will be driven by our ongoing focus on new-product development, cost-effective operations, and customer service initiatives that differentiate us from our competition. We expect earnings for the first quarter, which has been our weakest period in recent years, to exceed the prior-year level of $0.03 but fall short of the $0.10 reported in the fourth quarter."
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