Wausau Paper reports $20.4 million in earnings

Wausau Paper reported a 2004 earnings increase of 29 percent to $20.4 million.

"Wausau Paper made strong progress in 2004 despite only modest improvement in market conditions," Thomas Howatt, company president and chief executive officer, said in a news release. "Full-year earnings increased nearly 30 percent with profit improvements in two of our three business segments and net sales exceeded $1 billion for the first time in company history. ... Revenues from products developed within the last three years substantially exceeded our corporate goal of 25 percent, productivity increased 2 percent, double our goal for the year."

The company reported fourth-quarter earnings of $5.1 million compared with $5.3 million in the fourth quarter of 2003. Net sales increased 10 percent to $262.4 million from $239.3 million last year. While the company reported average selling prices improved in all three business areas, the most significant gains occurred within the towel and tissue and specialty products.

The company's printing and writing division reported fourth-quarter operating profits of $0.4 million, compared with $3.4 million last year. Current year results included fiber and energy cost increases of more than $4 million and pre-tax operating losses of $1.9 million related to the mid-November startup and fourth-quarter operation of the Brainerd mill. Net sales increased 8 percent.

"Despite soft fourth-quarter demand and highly competitive pricing, printing and writing gained share in its target markets, with consumer products and premium paper shipments increasing 32 percent and 12 percent, respectively," Howatt said. "While quarterly profits were unfavorably affected by startup expenses, the acquisition of the Brainerd mill will allow us to expand our sales of higher-margin premium papers and improve long-term profitability."

In regard to the outlook for 2005, Howatt said market conditions remain mixed with uncoated freesheet paper demand lagging behind towel and tissue and specialty markets.

"Despite expected higher fiber prices and natural gas costs well above historical averages, we expect first-quarter earnings to modestly exceed prior year results of $0.07 per share, assuming a first-quarter impact from Brainerd operations comparable to the fourth quarter," Howatt said.