Profile: Domtar Corp (UFS.N)
24 May 2017
Domtar Corporation, incorporated on August 16, 2006, designs, manufactures, markets and distributes a range of fiber-based products, including communication papers, specialty and packaging papers and absorbent hygiene products. The Company's segments include Pulp and Paper, and Personal Care. The Pulp and Paper segment consists of the design, manufacturing, marketing and distribution of communication, specialty and packaging papers, as well as softwood, fluff and hardwood market pulp. The Personal Care segment consists of the design, manufacturing, marketing and distribution of absorbent hygiene products. The Company consumes more than 50% of its pulp production to manufacture paper and other consumer products and the balance is sold as market pulp. The Company is a marketer of uncoated freesheet paper in North America serving a range of customers, including merchants, retail outlets, stationers, printers, publishers, converters and end users. It is also a marketer and producer of a line of incontinence care products, as well as infant diapers. It has a network of wood fiber converting assets that produce paper grade, fluff and specialty pulp.
Pulp and Paper
As of December 31, 2016, the Company produced approximately 4.1 million metric tons of softwood, fluff and hardwood pulp at 12 of its 13 mills (Port Huron being a non-integrated paper mill). As of December 31, 2016, it had nine integrated pulp and paper mills and one paper mill (eight in the United States and two in Canada), with an annual paper production capacity of approximately 3.0 million tons of uncoated freesheet paper. As of December 31, 2016, its paper manufacturing operations were supported by 13 converting and forms manufacturing operations, including a network of 10 plants located offsite from its paper making operations. As of December 31, 2016, it had approximately 77% of its paper production capacity in the United States and the remaining 23% in Canada. It produces and markets pulp at its pulp and paper mills in Ashdown, Espanola, Hawesville, Windsor, Marlboro and Nekoosa. It also produces papergrade, fluff and specialty pulps at its three stand-alone pulp mills in Kamloops, Dryden and Plymouth. As of December 31, 2016, it had approximately 56% of its trade pulp production capacity in the United States, and the remaining 44% in Canada. The manufacturing of pulp and paper requires wood fiber, chemicals and energy.
The fiber used by its pulp and paper mills in the United States is hardwood and softwood. The mills obtain fiber from a range of sources, which includes a combination of supply contracts, wood lot management arrangements, advance stumpage purchases and spot market purchases. The fiber used at its Windsor pulp and paper mill is hardwood originating from a range of sources, including purchases on the open market in Canada and the United States, contracts with Quebec wood producers' marketing boards, public lands where it has wood supply allocations and from Domtar's private lands. The softwood and hardwood fiber for its Espanola pulp and paper mill and the softwood fiber for its Dryden pulp mill, are obtained from third parties, directly or indirectly from public lands and through designated wood supply allocations for the pulp mills. The fiber used at its Kamloops pulp mill is all softwood, originating mostly from third-party sawmill operations in the southern-interior part of British Columbia.
The Company uses various chemical compounds in its pulp and paper manufacturing facilities that it purchases, primarily on a central basis, through contracts. For pulp manufacturing, it uses various chemicals, including caustic soda, sodium chlorate, sulfuric acid, lime and peroxide. For paper manufacturing, it also uses several chemical products, including starch, precipitated calcium carbonate, optical brighteners, dyes and aluminum sulfate. The Company's energy sources include biomass, natural gas and electricity. It owns cogenerating assets at all of its integrated pulp and paper mills, as well as hydro assets at three locations: Espanola, Nekoosa and Rothschild.
The Company's uncoated freesheet papers are categorized into communication and specialty and packaging papers. Communication papers are further categorized into business and commercial printing and publishing papers. Its business papers include copy and electronic imaging papers, which are used with inkjet and laser printers, photocopiers and plain-paper fax machines, as well as computer papers, preprinted forms and digital papers. These products are primarily for office and home use. Its commercial printing and publishing papers include uncoated freesheet papers, such as offset papers and opaques. These uncoated freesheet grades are used in sheet and roll fed offset presses across the spectrum of commercial printing end-uses, including digital printing. Its publishing papers include tradebook and lightweight uncoated papers used primarily in book publishing applications, such as textbooks, dictionaries, catalogs, magazines, hard cover novels and financial documents. These products also include base papers that are converted into finished products, such as envelopes, tablets, business forms and data processing/computer forms.
It also produces paper for various specialty and packaging markets. These products consist primarily of thermal printing, flexible packaging, food packaging, medical packaging, medical gowns and drapes, sandpaper backing, carbonless printing, labels, and other coating and laminating applications. It also manufacture papers for industrial and specialty applications, including carrier papers, treated papers, security papers and specialized printing and converting applications. It sells business papers primarily to paper stationers, merchants, office equipment manufacturers and retail outlets. It distributes uncoated commercial printing and publishing papers to end users and commercial printers, mainly through paper merchants, as well as selling directly to converters. It sells its specialty and packaging papers mainly to converters, who apply a further production process, such as coating, laminating, folding or waxing to its papers before selling them to a range of specialized end users. Its pulp products include softwood, fluff and hardwood kraft. Its pulp is used in a range of end products, such as diapers and personal hygiene products, bathroom and facial tissue, specialty and packaging papers, customers who make printing and writing grades, building products and electrical insulating papers.
The Personal Care business consists of the design, manufacturing, marketing and distribution of absorbent hygiene products, including both adult incontinence and infant diaper products. It is a suppliers of adult incontinence products sold into North America and Europe, servicing institutional and consumer channels, marketed primarily under its Attends, IncoPack, Indasec and Reassure brands, in addition to its customers' brands. As of December 31, 2016, the Company operated six manufacturing facilities, with each having the ability to produce multiple product categories. At the Jesup facility, it has research and development capabilities and production lines, which manufacture airlaid and ultrathin laminated absorbent cores and it also has research and development activities in its divisional office in Raleigh, North Carolina. It operates in the United States and in Europe.
234 Kingsley Park Drive
FORT MILL SC 29715