Exhibit 99.1
WAUSAU-MOSINEE PAPER CORPORATION
REPORTS SUBSTANTIAL INCREASE IN
FIRST-QUARTER EARNINGS
MOSINEE, WI APRIL 26, 2004 Wausau-Mosinee Paper Corporation (NYSE:WMO) today
reported first-quarter earnings of $3.5 million, or $0.07 per share, up
substantially from year-ago earnings of $1.3 million, or $0.03 per share. Net
sales rose 5 percent to $251.8 million, and shipments increased 2 percent to
215,000 tons.
"Increased first-quarter earnings principally reflect product mix improvement
and volume gains driven by successful product development efforts and our
strong service platform," explained Thomas J. Howatt, president and chief
executive officer. "All three of our business segments posted strong increases
in operating profit despite higher fiber costs and continuing high energy
prices."
Specialty Paper reported its seventh consecutive quarter of year-over-year
profit improvement and its highest quarterly net sales total since the second
quarter of 2000. Operating profits more than doubled to $3.5 million, from
$1.5 million the year before, and net sales increased 9 percent. "Specialty
Paper's profit improvement was driven by new-business development, select
selling price increases and strong operations," Mr. Howatt said. "Revenues
from products developed within the past three years continued to exceed 40
percent during the quarter, which helped reduce shipments of lower-priced
noncore products by 50 percent compared to last year."
Printing & Writing reported first-quarter operating profits of $2.6 million, up
substantially from $1.5 million for the same period last year. Net sales were
up 2 percent as premium shipments increased 9 percent. "Margins for uncoated
printing papers remain well below expectations due to three years of declining
demand. We believe, however, that a combination of product breadth, benchmark
service and a focus on the growth segments of the market will provide superior
returns over the long term," said Mr. Howatt.
Towel & Tissue's first-quarter net sales rose 4 percent, and operating profits
increased 32 percent to $5.3 million, from $4.0 million in the prior year,
reflecting market share gains and successful cost-reduction efforts.
"Innovative product offerings, such as our recently introduced
EcoSoft<trademark> Green Seal<reg-trade-mark>1 certified products, have driven
growth in our target markets and improved profitability. This focus on premium
products, coupled with excellent service, delivers value to our customers and
helps us gain market share," Mr. Howatt added.
Looking to the second quarter, Mr. Howatt said, "The benefits of an improving
economy have been slow to reach most segments of the paper industry. While we
continue to benefit from product development successes and select selling price
increases, we expect that historically high energy prices and increasing fiber
costs will mitigate a portion of the benefit. Ultimately, we expect second-
quarter earnings to represent a solid improvement over the first quarter with
results in the range of current analysts' estimates of $0.11 per share to
$0.13 per share."
Wausau-Mosinee's first-quarter conference call is scheduled for 11:00 a.m.
(EDT) on Tuesday, April 27, and can be accessed through the Company's web site
at www.wausaumosinee.com under "Investor Information." A replay of the webcast
will be available at the same site through May 6.
1Green Seal<reg-trade-mark> is a registered trademark of Green Seal, Inc., in
Washington, D.C. and is used by permission.
Wausau-Mosinee Paper Corporation produces fine printing and writing papers,
technical specialty papers, and "away-from-home" towel and tissue products.
SAFE HARBOR UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: The
matters discussed in this news release concerning the Company's future
performance or anticipated financial results are forward-looking statements and
are made pursuant to the safe harbor provisions of the Securities Reform Act of
1995. Such statements involve risks and uncertainties which may cause results
to differ materially from those set forth in these statements. Among other
things, these risks and uncertainties include the strength of the economy and
demand for paper products, increases in raw material and energy prices,
manufacturing problems at Company facilities, and other risks and assumptions
described in Item 1 of the Company's Form 10-K for the year ended December 31,
2003. The Company assumes no obligation to update or supplement forward-
looking statements that become untrue because of subsequent events.
(tables follow)
WAUSAU-MOSINEE PAPER CORPORATION
INTERIM REPORT - QUARTER ENDED MARCH 31, 2004
(in thousands, except share amounts)
CONDENSED CONSOLIDATED STATEMENTS Three Months
OF OPERATIONS (UNAUDITED) Ended March 31,
2004 2003
Net Sales $ 251,815 $ 239,826
Cost of Sales 225,117 218,947
Gross Profit 26,698 20,879
Selling & Administrative Expense 18,884 16,244
Operating Profit 7,814 4,635
Interest Expense (2,527) (2,501)
Other Income/(Expense), Net 194 (14)
Earnings Before Income Taxes 5,481 2,120
Provision for Income Taxes 2,029 785
Net Earnings $ 3,452 $ 1,335
Net Earnings Per Share (Basic & Diluted) $ 0.07 $ 0.03
Weighted Average Shares Outstanding (Basic) 51,617,395 51,536,891
CONDENSED CONSOLIDATED BALANCE SHEETS (NOTE 1) March 31, December 31,
2004 2003
Current Assets $267,947 $251,418
Property, Plant & Equipment, Net 555,708 565,722
Other Assets 41,034 40,960
Total Assets $864,689 $858,100
Current Liabilities $119,985 $115,004
Long-term Debt 161,964 162,174
Other Liabilities 227,880 230,606
Stockholders' Equity 354,860 350,316
Total Liabilities & Stockholders' Equity $864,689 $858,100
CONDENSED CONSOLIDATED STATEMENTS Three Months
OF CASH FLOW (UNAUDITED) Ended March 31,
2004 2003
Cash Provided by Operating Activities $14,031 $14,508
Cash Used in Investing Activities:
Capital Expenditures (3,937) (4,669)
Acquisition of Business 0 (8,413)
(3,937) (13,082)
Cash Provided by (Used in) Financing Activities:
Net Borrowings Under Credit Agreements 0 3,030
Payments Under Capital Lease Obligation (28) 0
Dividends Paid (4,382) (4,381)
Proceeds from Stock Option Exercises 1,087 0
(3,323) (1,351)
Net Increase in Cash $ 6,771 $ 75
Note 1 -Balance sheet amounts at March 31, 2004 are unaudited. The December
31, 2003 amounts are derived from audited financial statements.
Note 2 -Effective March 3, 2003, the Company acquired certain assets of a
laminated papers producer. The acquisition is being accounted for as a
purchase business combination and, accordingly, the purchase price has
been allocated using the fair values of the acquired receivables,
inventory, machinery and equipment, and identifiable intangible assets.
No goodwill was recorded as a result of this acquisition.
Note 3- Interim Segment Information
The Company's operations are classified into three principal reportable
segments: the Printing & Writing Group, the Specialty Paper Group, and
the Towel & Tissue Group, each providing different products. Separate
management of each segment is required because each business unit is
subject to different marketing, production and technology strategies.
Printing & Writing produces a broad line of premium printing and
writing grades at manufacturing facilities in Brokaw, Wisconsin; and
Groveton, New Hampshire. Printing & Writing also includes two
converting facilities that produce laminated roll wrap and related
specialty finishing and packaging products, and a converting facility
that converts printing and writing grades. Specialty Paper produces
specialty papers at its manufacturing facilities in Rhinelander,
Wisconsin; Mosinee, Wisconsin; and Jay, Maine. Towel & Tissue produces
a complete line of towel and tissue products that are marketed along
with soap and dispensing systems for the "away-from-home" market.
Towel & Tissue operates a paper mill in Middletown, Ohio, and a
converting facility in Harrodsburg, Kentucky.
Sales, operating profit, and asset information by segment is as
follows:
(in thousands, except ton data) March 31, December 31,
2004 2003
Segment Assets (Note 1)
Printing & Writing $287,628 $283,711
Specialty Paper 334,049 334,079
Towel & Tissue 162,824 165,199
Corporate & Unallocated* 80,188 75,111
$864,689 $858,100
Three Months
Ended March 31,
2004 2003
Net Sales External Customers (unaudited)
Printing & Writing $100,101 $ 98,377
Specialty Paper 100,931 92,458
Towel & Tissue 50,783 48,991
$251,815 $239,826
Operating Profit (unaudited)
Printing & Writing $ 2,551 $ 1,486
Specialty Paper 3,451 1,512
Towel & Tissue 5,301 4,031
Total Reportable Segment Operating Profit 11,303 7,029
Corporate & Eliminations (3,489) (2,394)
Interest Expense (2,527) (2,501)
Other Income/(Expense), Net 194 (14)
Earnings Before Income Taxes $ 5,481 $ 2,120
Depreciation, Depletion and Amortization (unaudited)
Printing & Writing $ 4,176 $ 4,158
Specialty Paper 6,025 6,122
Towel & Tissue 4,496 4,582
Corporate & Unallocated 285 183
$ 14,982 $ 15,045
Tons Sold (unaudited)
Printing & Writing 92,240 88,731
Specialty Paper 87,585 87,675
Towel & Tissue 35,423 34,350
215,248 210,756
<FN>
* Segment assets do not include intersegment accounts receivable, cash,
deferred tax assets and certain other assets which are not
identifiable with the segments.