Domtar 8K Results of Operations and Financial Condition | UFS 25 Oct 19

Exhibit 99.1

234 Kingsley Park Drive

Fort Mill, South Carolina 29715

News Release

TICKER SYMBOL

Investor RELATIONS

MEDIA RELATIONS

(NYSE: UFS) (TSX: UFS)

Nicholas Estrela

Director

Investor Relations

Tel.: 514-848-5049

David Struhs

Vice-President

Corporate Services and Sustainability

Tel.: 803-802-8031

DOMTAR CORPORATION REPORTS PRELIMINARY THIRD QUARTER 2019 FINANCIAL RESULTS

Lower maintenance and raw material costs drive improved results

(All financial information is in U.S. dollars, and all earnings per share results are diluted, unless otherwise noted).

•	Third quarter 2019 net earnings of $0.32 per share; earnings before items¹ of $0.89 per share

•	Announced reduction of 204,000 tons of uncoated freesheet capacity in Paper

•	$137 million of share repurchases

Fort Mill, SC, October 25, 2019 – Domtar Corporation (NYSE: UFS) (TSX: UFS) today reported net earnings of $20 million ($0.32 per share) for the third quarter of 2019 compared to net earnings of $18 million ($0.28 per share) for the second quarter of 2019 and net earnings of $99 million ($1.57 per share) for the third quarter of 2018. Sales for the third quarter of 2019 were $1.3 billion.

Excluding items listed below, the Company had earnings before items¹ of $55 million ($0.89 per share) for the third quarter of 2019 compared to earnings before items¹ of $36 million ($0.57 per share) for the second quarter of 2019 and earnings before items¹ of $92 million ($1.46 per share) for the third quarter of 2018.

ITEMS

Description	Segment	Line item	Amount	After tax effect	EPS impact (per share)
			(in millions)
Third quarter 2019

● Paper machine closures	Pulp and Paper	Impairment of long-lived assets	$32	$25	$0.40

● Paper machine closures	Pulp and Paper	Closure and restructuring costs	$5	$4	$0.07

● Margin improvement plan	Personal Care	Impairment of long-lived assets	$1	$1	$0.02

● Margin improvement plan	Personal Care	Closure and restructuring costs	$6	$5	$0.08

¹	Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix.

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Description	Segment	Line item	Amount	After tax effect	EPS impact (per share)
			(in millions)
Second quarter 2019

● Margin improvement plan	Personal Care	Impairment of long-lived assets	$15	$12	$0.19

● Margin improvement plan	Personal Care	Closure and restructuring costs	$8	$6	$0.10

Third quarter 2018

● U.S. Tax Reform	Corporate	Income tax benefit	$7	$7	$0.11

QUARTERLY REVIEW

“Our results in Paper improved with lower maintenance and raw material costs offsetting market related downtime costs. Our paper machines ran well and cost performance was strong, resulting in a 300 basis point margin expansion for this business,” said John D. Williams, President and Chief Executive Officer. “In Pulp, downward price adjustments continued in most regions but we are seeing increasing signs of improvement in supply and demand fundamentals.”

Mr. Williams added, “In Personal Care, EBITDA and margin performance were one of the best in several quarters as we continue to make excellent progress in executing our business plan, with a strong focus on commercial initiatives, cost performance and delivering on our margin improvement plan.”

Operating income was $29 million in the third quarter of 2019 compared to operating income of $34 million in the second quarter of 2019. Depreciation and amortization totaled $72 million in the third quarter of 2019.

Operating income before items¹ was $73 million in the third quarter of 2019 compared to an operating income before items¹ of $57 million in the second quarter of 2019.


(In millions of dollars)	3Q 2019			2Q 2019

Sales	$	1,283		$	1,317
Operating income (loss)
Pulp and Paper segment		31			62
Personal Care segment		2			(18	)
Corporate		(4	)		(10	)
Total operating income		29			34
Operating income before items¹		73			57
Depreciation and amortization		72			74

¹	Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix.

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The decrease in operating income in the third quarter of 2019 was the result of lower selling prices in pulp, market-related downtime costs and the Espanola outage. These factors were partially offset by lower maintenance and raw material costs, lower selling, general and administrative expenses and lower freight, fixed and other costs.

When compared to the second quarter of 2019, manufactured paper shipments were down 1% and pulp shipments increased 12%. The shipment-to-production ratio for paper was 103% in the third quarter of 2019, compared to 98% in the second quarter of 2019. Paper inventories decreased by 19,000 tons, and pulp inventories decreased by 9,000 metric tons when compared to the second quarter of 2019.

LIQUIDITY AND CAPITAL

Cash flow from operating activities amounted to $108 million and capital expenditures were $56 million, resulting in free cash flow¹ of $52 million for the third quarter of 2019. Domtar’s net debt-to-total capitalization ratio¹ stood at 26% at September 30, 2019 compared to 22% at June 30, 2019.

OUTLOOK

For the fourth quarter, maintenance is expected to be higher while Paper is expected to be negatively impacted in part by a seasonally unfavorable mix. We anticipate some volatility in softwood and fluff pulp markets while Personal Care is expected to benefit from our margin improvement plan and increased sales driven by a stronger order book.

EARNINGS CONFERENCE CALL

The Company will hold a conference call today at 11:00 a.m. (ET) to discuss its third quarter 2019 financial results. Financial analysts are invited to participate in the call by dialing 1 (866) 548-4713 (toll free - North America) or 1 (323) 794-2093 (International) at least 10 minutes before start time, while media and other interested individuals are invited to listen to the live webcast on the Domtar Corporation website at www.domtar.com.

The Company will release its fourth quarter 2019 earnings results on February 7, 2020 before markets open, followed by a conference call at 10:00 a.m. (ET) to discuss results. The date is tentative and will be confirmed approximately three weeks prior to the official earnings release date.

¹	Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix.

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About Domtar

Domtar is a leading provider of a wide variety of fiber-based products including communication, specialty and packaging papers, market pulp and absorbent hygiene products. With approximately 10,000 employees serving more than 50 countries around the world, Domtar is driven by a commitment to turn sustainable wood fiber into useful products that people rely on every day. Domtar’s annual sales are approximately $5.5 billion, and its common stock is traded on the New York and Toronto Stock Exchanges. Domtar’s principal executive office is in Fort Mill, South Carolina. To learn more, visit www.domtar.com.

Forward-Looking Statements

Statements in this release about our plans, expectations and future performance, including the statements by Mr. Williams and those contained under “Outlook,” are “forward-looking statements.” Actual results may differ materially from those suggested by these statements for a number of reasons, including changes in customer demand and pricing, changes in manufacturing costs, future acquisitions and divestitures, including facility closings, and the other reasons identified under “Risk Factors” in our Form 10-K for 2018 as filed with the SEC and as updated by subsequently filed Form 10-Qs. Except to the extent required by law, we expressly disclaim any obligation to update or revise these forward-looking statements to reflect new events or circumstances or otherwise.

- (30) -

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Domtar Corporation

Highlights

(In millions of dollars, unless otherwise noted)

{

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30,			September 30,			September 30,			September 30,
	2019			2018			2019			2018
	(Unaudited)
	$			$			$			$
Selected Segment Information
Sales
Pulp and Paper		1,071			1,146			3,314			3,369
Personal Care		227			237			711			746
Total for reportable segments		1,298			1,383			4,025			4,115
Intersegment sales		(15	)		(16	)		(49	)		(50	)
Consolidated sales		1,283			1,367			3,976			4,065
Depreciation and amortization						��
Pulp and Paper		56			58			171			180
Personal Care		16			17			48			53
Total for reportable segments		72			75			219			233
Impairment of long-lived assets - Pulp and Paper		32			—			32			—
Impairment of long-lived assets - Personal Care		1			—			26			—
Consolidated depreciation and amortization and impairment of long-lived assets		105			75			277			233
Operating income (loss)
Pulp and Paper		31			135			237			290
Personal Care		2			(3	)		(24	)		7
Corporate		(4	)		(18	)		(35	)		(44	)
Consolidated operating income		29			114			178			253
Interest expense, net		12			15			38			47
Non-service components of net periodic benefit cost		(2	)		(4	)		(7	)		(13	)
Earnings before income taxes and equity loss		19			103			147			219
Income tax (benefit) expense		(1	)		3			28			22
Equity loss, net of taxes		—			1			1			1
Net earnings		20			99			118			196
Per common share (in dollars)
Net earnings
Basic		0.33			1.57			1.89			3.12
Diluted		0.32			1.57			1.88			3.11
Weighted average number of common shares outstanding (millions)
Basic		61.5			62.9			62.5			62.8
Diluted		61.7			63.2			62.7			63.1
Cash flows from operating activities		108			70			282			337
Additions to property, plant and equipment		56			49			157			111

Domtar Corporation

Consolidated Statements of Earnings

(In millions of dollars, unless otherwise noted)

	Three months ended			Three months ended			Nine months ended			Nine months ended
	September 30,			September 30,			September 30,			September 30,
	2019			2018			2019			2018
	(Unaudited)
	$			$			$			$

Sales		1,283			1,367			3,976			4,065
Operating expenses
Cost of sales, excluding depreciation and amortization		1,041			1,059			3,172			3,239
Depreciation and amortization		72			75			219			233
Selling, general and administrative		94			115			322			343
Impairment of long-lived assets		33			—			58			—
Closure and restructuring costs		11			—			23			—
Other operating loss (income), net		3			4			4			(3	)
		1,254			1,253			3,798			3,812
Operating income		29			114			178			253
Interest expense, net		12			15			38			47
Non-service components of net periodic benefit cost		(2	)		(4	)		(7	)		(13	)
Earnings before income taxes and equity loss		19			103			147			219
Income tax (benefit) expense		(1	)		3			28			22
Equity loss, net of taxes		—			1			1			1
Net earnings		20			99			118			196
Per common share (in dollars)
Net earnings
Basic		0.33			1.57			1.89			3.12
Diluted		0.32			1.57			1.88			3.11
Weighted average number of common shares outstanding (millions)
Basic		61.5			62.9			62.5			62.8
Diluted		61.7			63.2			62.7			63.1

Domtar Corporation

Consolidated Balance Sheets at

(In millions of dollars)


	September 30,			December 31,
	2019			2018
	(Unaudited)
	$			$
Assets
Current assets
Cash and cash equivalents		98			111
Receivables, less allowances of $8 and $6		618			670
Inventories		798			762
Prepaid expenses		33			24
Income and other taxes receivable		53			22
Total current assets		1,600			1,589
Property, plant and equipment, net		2,499			2,605
Operating lease right-of-use assets		77			—
Intangible assets, net		568			597
Other assets		140			134
Total assets		4,884			4,925
Liabilities and shareholders' equity
Current liabilities
Bank indebtedness		1			—
Trade and other payables		646			757
Income and other taxes payable		28			25
Operating lease liabilities due within one year		26			—
Long-term debt due within one year		1			1
Total current liabilities		702			783
Long-term debt		938			853
Operating lease liabilities		68			—
Deferred income taxes and other		479			476
Other liabilities and deferred credits		258			275
Shareholders' equity
Common stock		1			1
Additional paid-in capital		1,842			1,981
Retained earnings		1,058			1,023
Accumulated other comprehensive loss		(462	)		(467	)
Total shareholders' equity		2,439			2,538
Total liabilities and shareholders' equity		4,884			4,925

Domtar Corporation

Consolidated Statements of Cash Flows

(In millions of dollars)

	For the nine months ended
	September 30, 2019			September 30, 2018
	(Unaudited)
	$			$
Operating activities
Net earnings		118			196
Adjustments to reconcile net earnings to cash flows from operating activities
Depreciation and amortization		219			233
Deferred income taxes and tax uncertainties		1			3
Impairment of long-lived assets		58			—
Net gains on disposals of property, plant and equipment		—			(4	)
Stock-based compensation expense		7			7
Equity loss, net		1			1
Changes in assets and liabilities
Receivables		50			(7	)
Inventories		(34	)		(23	)
Prepaid expenses		(4	)		(4	)
Trade and other payables		(111	)		(6	)
Income and other taxes		(27	)		(16	)
Difference between employer pension and other post-retirement contributions and pension and other post-retirement expense		(3	)		(46	)
Other assets and other liabilities		7			3
Cash flows from operating activities		282			337
Investing activities
Additions to property, plant and equipment		(157	)		(111	)
Proceeds from disposals of property, plant and equipment		1			4
Other		—			(6	)
Cash flows used for investing activities		(156	)		(113	)
Financing activities
Dividend payments		(83	)		(81	)
Stock repurchase		(139	)		—
Net change in bank indebtedness		2			—
Change in revolving credit facility		45			—
Proceeds from receivables securitization facility		150			—
Repayments of receivables securitization facility		(110	)		(25	)
Repayments of long-term debt		(1	)		—
Other		(1	)		1
Cash flows used for financing activities		(137	)		(105	)
Net (decrease) increase in cash and cash equivalents		(11	)		119
Impact of foreign exchange on cash		(2	)		(2	)
Cash and cash equivalents at beginning of period		111			139
Cash and cash equivalents at end of period		98			256
Supplemental cash flow information
Net cash payments for:
Interest		39			48
Income taxes		55			40

Domtar Corporation

Quarterly Reconciliation of Non-GAAP Financial Measures

(In millions of dollars, unless otherwise noted)

The following table sets forth certain non-U.S. generally accepted accounting principles (“GAAP”) financial metrics identified in bold as “Earnings before items”, “Earnings before items per diluted share”, “EBITDA”, “EBITDA margin”, “EBITDA before items”, “EBITDA margin before items”, “Free cash flow”, “Net debt” and “Net debt-to-total capitalization”. Management believes that the financial metrics are useful to understand our operating performance and benchmark with peers within the industry. The Company calculates “Earnings before items” and “EBITDA before items” by excluding the after-tax (pre-tax) effect of specified items. These metrics are presented as a complement to enhance the understanding of operating results but not in substitution for GAAP results.

				2019												2018
				Q1			Q2			Q3			YTD			Q1			Q2			Q3			Q4			Year
Reconciliation of "Earnings before items" to Net earnings
		Net earnings	($)		80			18			20			118			54			43			99			87			283
	(+)	Impairment of long-lived assets	($)		8			12			26			46			—			—			—			5			5
	(+)	Closure and restructuring costs	($)		3			6			9			18			—			—			—			6			6
	(+)	Litigation settlement	($)		—			—			—			—			2			—			—			—			2
	(-)	Net gains on disposals of property, plant and equipment	($)		—			—			—			—			(1	)		(2	)		—			—			(3	)
	(-)	U.S. Tax Reform	($)		—			—			—			—			—			—			(7	)		5			(2	)
	(=)	Earnings before items	($)		91			36			55			182			55			41			92			103			291
	(/)	Weighted avg. number of common shares outstanding (diluted)	(millions)		63.2			63.3			61.7			62.7			62.9			63.2			63.2			63.0			63.1
	(=)	Earnings before items per diluted share	($)		1.44			0.57			0.89			2.90			0.87			0.65			1.46			1.63			4.61

Reconciliation of "EBITDA" and "EBITDA before items" to Net earnings
		Net earnings	($)		80			18			20			118			54			43			99			87			283
	(+)	Equity loss, net of taxes	($)		1			—			—			1			—			—			1			1			2
	(+)	Income tax expense (benefit)	($)		24			5			(1	)		28			11			8			3			35			57
	(+)	Interest expense, net	($)		13			13			12			38			16			16			15			15			62
	(+)	Depreciation and amortization	($)		73			74			72			219			79			79			75			75			308
	(+)	Impairment of long-lived assets	($)		10			15			33			58			—			—			—			7			7
	(-)	Net gains on disposals of property, plant and equipment	($)		—			—			—			—			(1	)		(3	)		—			—			(4	)
	(=)	EBITDA	($)		201			125			136			462			159			143			193			220			715
	(/)	Sales	($)		1,376			1,317			1,283			3,976			1,345			1,353			1,367			1,390			5,455
	(=)	EBITDA margin	(%)		15	%		9	%		11	%		12	%		12	%		11	%		14	%		16	%		13	%
		EBITDA	($)		201			125			136			462			159			143			193			220			715
	(+)	Closure and restructuring costs	($)		4			8			11			23			—			—			—			8			8
	(+)	Litigation settlement	($)		—			—			—			—			2			—			—			—			2
	(=)	EBITDA before items	($)		205			133			147			485			161			143			193			228			725
	(/)	Sales	($)		1,376			1,317			1,283			3,976			1,345			1,353			1,367			1,390			5,455
	(=)	EBITDA margin before items	(%)		15	%		10	%		11	%		12	%		12	%		11	%		14	%		16	%		13	%

Domtar Corporation

Quarterly Reconciliation of Non-GAAP Financial Measures

(In millions of dollars, unless otherwise noted)

				2019												2018
				Q1			Q2			Q3			YTD			Q1			Q2			Q3			Q4			Year
Reconciliation of "Free cash flow" to Cash flows from operating activities
		Cash flows from operating activities	($)		55			119			108			282			90			177			70			217			554
	(-)	Additions to property, plant and equipment	($)		(46	)		(55	)		(56	)		(157	)		(25	)		(37	)		(49	)		(84	)		(195	)
	(=)	Free cash flow	($)		9			64			52			125			65			140			21			133			359

"Net debt-to-total capitalization" computation
		Bank indebtedness	($)		3			3			1						—			1			—			—
	(+)	Long-term debt due within one year	($)		1			1			1						1			1			1			1
	(+)	Long-term debt	($)		853			824			938						1,103			1,103			1,103			853
	(=)	Debt	($)		857			828			940						1,104			1,105			1,104			854
	(-)	Cash and cash equivalents	($)		(94	)		(93	)		(98	)					(152	)		(264	)		(256	)		(111	)
	(=)	Net debt	($)		763			735			842						952			841			848			743
	(+)	Shareholders' equity	($)		2,608			2,619			2,439						2,493			2,458			2,553			2,538
	(=)	Total capitalization	($)		3,371			3,354			3,281						3,445			3,299			3,401			3,281
		Net debt	($)		763			735			842						952			841			848			743
	(/)	Total capitalization	($)		3,371			3,354			3,281						3,445			3,299			3,401			3,281
	(=)	Net debt-to-total capitalization	(%)		23	%		22	%		26	%					28	%		25	%		25	%		23	%

“Earnings before items”, “Earnings before items per diluted share”, “EBITDA”, “EBITDA margin”, “EBITDA before items”, “EBITDA margin before items”, “Free cash flow”, “Net debt” and “Net debt-to-total capitalization” have no standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation or as a substitute for Net earnings or any other earnings statement, cash flow statement or balance sheet financial information prepared in accordance with GAAP. It is important for readers to understand that certain items may be presented in different lines by different companies on their financial statements, thereby leading to different measures for different companies.

Domtar Corporation

Quarterly Reconciliation of Non-GAAP Financial Measures – By Segment 2019

(In millions of dollars, unless otherwise noted)

The following table sets forth certain non-U.S. generally accepted accounting principles (“GAAP”) financial metrics identified in bold as “Operating income (loss) before items”, “EBITDA before items” and “EBITDA margin before items” by reportable segment. Management believes that the financial metrics are useful to understand our operating performance and benchmark with peers within the industry. The Company calculates the segmented “Operating income (loss) before items” by excluding the pre-tax effect of specified items. These metrics are presented as a complement to enhance the understanding of operating results but not in substitution for GAAP results.

				Pulp and Paper					Personal Care					Corporate					Total
				Q1'19	Q2'19	Q3'19	Q4'19	YTD	Q1'19	Q2'19	Q3'19	Q4'19	YTD	Q1'19	Q2'19	Q3'19	Q4'19	YTD	Q1'19	Q2'19	Q3'19	Q4'19	YTD
Reconciliation of Operating income (loss) to "Operating income (loss) before items"
		Operating income (loss)	($)	144	62	31	—	237	(8)	(18)	2	—	(24)	(21)	(10)	(4)	—	(35)	115	34	29	—	178
	(+)	Impairment of long-lived assets	($)	—	—	32	—	32	10	15	1	—	26	—	—	—	—	—	10	15	33	—	58
	(+)	Closure and restructuring costs	($)	—	—	5	—	5	4	8	6	—	18	—	—	—	—	—	4	8	11	—	23
	(=)	Operating income (loss) before items	($)	144	62	68	—	274	6	5	9	—	20	(21)	(10)	(4)	—	(35)	129	57	73	—	259

Reconciliation of "Operating income (loss) before items" to "EBITDA before items"
		Operating income (loss) before items	($)	144	62	68	—	274	6	5	9	—	20	(21)	(10)	(4)	—	(35)	129	57	73	—	259
	(+)	Non-service components of net periodic benefit cost	($)	3	3	2	—	8	—	—	—	—	—	—	(1)	—	—	(1)	3	2	2	—	7
	(+)	Depreciation and amortization	($)	57	58	56	—	171	16	16	16	—	48	—	—	—	—	—	73	74	72	—	219
	(=)	EBITDA before items	($)	204	123	126	—	453	22	21	25	—	68	(21)	(11)	(4)	—	(36)	205	133	147	—	485
	(/)	Sales	($)	1,147	1,096	1,071	—	3,314	247	237	227	—	711	—	—	—	—	—	1,394	1,333	1,298	—	4,025
	(=)	EBITDA margin before items	(%)	18%	11%	12%	—	14%	9%	9%	11%	—	10%	—	—	—	—	—	15%	10%	11%	—	12%

“Operating income (loss) before items”, “EBITDA before items” and “EBITDA margin before items” have no standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation or as a substitute for Operating income (loss) or any other earnings statement, cash flow statement or balance sheet financial information prepared in accordance with GAAP. It is important for readers to understand that certain items may be presented in different lines by different companies on their financial statements, thereby leading to different measures for different companies.

Domtar Corporation

Quarterly Reconciliation of Non-GAAP Financial Measures – By Segment 2018

(In millions of dollars, unless otherwise noted)

				Pulp and Paper					Personal Care					Corporate					Total
				Q1'18	Q2'18	Q3'18	Q4'18	Year	Q1'18	Q2'18	Q3'18	Q4'18	Year	Q1'18	Q2'18	Q3'18	Q4'18	Year	Q1'18	Q2'18	Q3'18	Q4'18	Year
Reconciliation of Operating income (loss) to "Operating income (loss) before items"
		Operating income (loss)	($)	76	79	135	148	438	8	2	(3)	(12)	(5)	(7)	(19)	(18)	(3)	(47)	77	62	114	133	386
	(+)	Impairment of long-lived assets	($)	—	—	—	—	—	—	—	—	7	7	—	—	—	—	—	—	—	—	7	7
	(-)	Net gains on disposals of property, plant and equipment	($)	(1)	(3)	—	—	(4)	—	—	—	—	—	—	—	—	—	—	(1)	(3)	—	—	(4)
	(+)	Closure and restructuring costs	($)	—	—	—	—	—	—	—	—	8	8	—	—	—	—	—	—	—	—	8	8
	(+)	Litigation settlement	($)	—	—	—	—	—	—	—	—	—	—	2	—	—	—	2	2	—	—	—	2
	(=)	Operating income (loss) before items	($)	75	76	135	148	434	8	2	(3)	3	10	(5)	(19)	(18)	(3)	(45)	78	59	114	148	399

Reconciliation of "Operating income (loss) before items" to "EBITDA before items"
		Operating income (loss) before items	($)	75	76	135	148	434	8	2	(3)	3	10	(5)	(19)	(18)	(3)	(45)	78	59	114	148	399
	(+)	Non-service components of net periodic benefit cost	($)	4	6	4	5	19	—	—	—	—	—	—	(1)	—	—	(1)	4	5	4	5	18
	(+)	Depreciation and amortization	($)	61	61	58	58	238	18	18	17	17	70	—	—	—	—	—	79	79	75	75	308
	(=)	EBITDA before items	($)	140	143	197	211	691	26	20	14	20	80	(5)	(20)	(18)	(3)	(46)	161	143	193	228	725
	(/)	Sales	($)	1,100	1,123	1,146	1,154	4,523	262	247	237	254	1,000	—	—	—	—	—	1,362	1,370	1,383	1,408	5,523
	(=)	EBITDA margin before items	(%)	13%	13%	17%	18%	15%	10%	8%	6%	8%	8%	—	—	—	—	—	12%	10%	14%	16%	13%

Domtar Corporation

Supplemental Segmented Information

(In millions of dollars, unless otherwise noted)

		2019												2018
		Q1			Q2			Q3			YTD			Q1			Q2			Q3			Q4			Year
Pulp and Paper Segment
Sales	($)		1,147			1,096			1,071			3,314			1,100			1,123			1,146			1,154			4,523
Operating income	($)		144			62			31			237			76			79			135			148			438
Depreciation and amortization	($)		57			58			56			171			61			61			58			58			238
Impairment of long-lived assets	($)		—			—			32			32			—			—			—			—			—
Paper
Paper Production	('000 ST)		757			697			653			2,107			739			739			743			757			2,978
Paper Shipments - Manufactured	('000 ST)		736			681			672			2,089			769			754			727			721			2,971
Communication Papers	('000 ST)		615			567			563			1,745			640			615			596			595			2,446
Specialty and Packaging Papers	('000 ST)		121			114			109			344			129			139			131			126			525
Paper Shipments - Sourced from 3rd parties	('000 ST)		23			21			25			69			28			26			30			25			109
Paper Shipments - Total	('000 ST)		759			702			697			2,158			797			780			757			746			3,080
Pulp
Pulp Shipments^(a)	('000 ADMT)		349			370			416			1,135			374			377			390			395			1,536
Pulp Shipments mix^(b):
Hardwood Kraft Pulp	(%)		2	%		2	%		5	%		3	%		4	%		3	%		3	%		3	%		4	%
Softwood Kraft Pulp	(%)		53	%		56	%		55	%		55	%		58	%		56	%		56	%		55	%		56	%
Fluff Pulp	(%)		45	%		42	%		40	%		42	%		38	%		41	%		41	%		42	%		40	%

Personal Care Segment
Sales	($)		247			237			227			711			262			247			237			254			1,000
Operating (loss) income	($)		(8	)		(18	)		2			(24	)		8			2			(3	)		(12	)		(5	)
Depreciation and amortization	($)		16			16			16			48			18			18			17			17			70
Impairment of long-lived assets	($)		10			15			1			26			—			—			—			7			7

Average Exchange Rates	$US / $CAN		1.329			1.337			1.321			1.329			1.264			1.290			1.307			1.321			1.296
	$CAN / $US		0.752			0.748			0.757			0.752			0.791			0.775			0.765			0.757			0.772
	€ / $US		1.136			1.124			1.111			1.124			1.229			1.192			1.163			1.141			1.181

^(a) Figures represent Pulp Shipments to third parties.

^(b) Percentages include Pulp Shipments to our Personal Care segment.

Note: the term “ST” refers to a short ton and the term “ADMT” refers to an air dry metric ton.

Domtar (UFS) 8-KResults of Operations and Financial Condition