Domtar Corporation (Domtar), incorporated on August 16, 2006, is a manufacturer and marketer of uncoated freesheet paper in North America. The Company also manufactures papergrade, fluff and specialty pulp. The Company also designs, manufactures, markets and distributes a range of paper products for a variety of customers, including merchants, retail outlets, stationers, printers, publishers, converters and end-users. Domtar also produces lumber and other specialty and industrial wood products. Domtar operates in three segments: Papers, Paper Merchants and Wood. During the year ended December 31, 2008, approximately 81% of the Company’s revenue was from the Papers segment, approximately 15% was from the Paper Merchants segment and approximately 4% was from the Wood segment. Domtar owns and operates Domtar Distribution Group, an network of paper distribution facilities.
The Company’s Papers segment represents the aggregation of the manufacturing and distribution of business, commercial printing and publication, and converting and specialty papers, as well as pulp. It has 12 pulp and paper mills in operation (nine in the United States and three in Canada) with an annual paper production capacity of approximately 4.1 million tons of uncoated freesheet paper. In addition, it has an annual production capacity of 238,000 tons of coated groundwood at its Columbus paper mill. Approximately 83% of Domtar’s paper production capacity is domestic and the remaining 17% is located in Canada. Its paper manufacturing operations are supported by 16 converting and distribution operations, including a network of 12 plants located offsite of its paper making operations. Also, it has forms manufacturing operations at three of the offsite converting and distribution operations and two stand-alone forms manufacturing operations.
Domtar manufactures and sells pulp in excess of its internal requirements and it purchases papergrade pulp from third parties. The Company produces market pulp at its three non-integrated pulp mills in Kamloops, Woodland and Dryden, as well as at its pulp and paper mills in Espanola, Ashdown, Hawesville, and Windsor. Also, it produces fluff pulp at its Plymouth mill.
Domtar’s Paper Merchants business involves the purchasing, warehousing, sale and distribution of its products and those of other manufacturers. Products include business, printing and publishing papers and certain industrial products. These products are sold to a customer base, which includes small, medium and large commercial printers, publishers, quick copy firms, catalog and retail companies, and institutional entities.
The Company’s paper merchants operate in the United States and Canada under a single banner and umbrella name, the Domtar Distribution Group. Ris Paper operates throughout the Northeast, Mid-Atlantic and Midwest areas from 19 locations in the United States, including 16 distribution centers serving customers in over 18 states. The Canadian business operates as Buntin Reid in three locations in Ontario; JBR/La Maison du Papier in two locations in Quebec, and The Paper House from two locations in Atlantic Canada.
The Company’s Wood business consists of the manufacturing, marketing and distribution of lumber and wood-based products, and the management of forest resources. It operates seven sawmills with a production capacity of approximately 855 million board feet of lumber and one remanufacturing facility. In addition, it owns two sawmills that are not in operation, as of December 31, 2008, but have an aggregate production capacity of approximately 360 million board feet of lumber.
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