The paper plant boosts earnings for Wausau-Mosinee.
JAY – In some respects, not much changes at the 115-year-old Otis mill: The economic future seems always cloudy, and workers turn out quality products.
They watch the industry lurch ahead and fall back.
They feel the squeeze around them on the map, from Baileyville to Millinocket, across the borders into the White Mountains and Quebec. They raise families, pay bills and keep the machines running.
And for that, their contributions were recognized on Tuesday by the president and CEO of Wausau-Mosinee Paper Corp., the mill’s owner. The firm’s specialty paper group – consisting of the Otis mill and two in Wisconsin – recorded a $1.5 million operating profit for the first quarter of 2003, compared with a $900,000 loss one year ago.
Shipments within the specialty group increased by 11 percent for the quarter, according to the corporate earnings report. It was welcome news in a still-faltering sector.
“These improvements reflect the specialty paper group’s growing ability to identify profitable market opportunities,” said President and CEO Thomas J. Howatt, who praised the mills for their ability to reduce controllable costs.
About 270 people work at the Otis mill, producing 70,000 tons of specialty papers each year on two machines.
“Most notably, the group achieved its third consecutive quarter of profitability despite continued sluggish demand,” Howatt said.
Overall, Wausau-Mosinee saw earnings of $1.3 million, or $.03 per share, compared with $3.4 million, or $.07 per share, during the first quarter of 2002. Net sales increased 6 percent to $239.8 million. Howatt pointed to sharp increases in energy, market pulp and wastepaper prices as dictating the pace of growth.
Last year was not a friendly one for forest and paper companies. The largest 100 of them saw net earnings drop by more than 20 percent in 2002, from $6.8 billion to $5.2 billion, according to PricewaterhouseCoopers.
“Though far from satisfied with our first-quarter earnings, we are pleased that the market share gains and bottom-line benefits achieved through our internal initiatives were able to offset much of the higher energy and fiber costs,” Howatt said.
Headquartered in Wisconsin, Wausau-Mosinee employs more than 3,000 people at 11 locations, all east of the Mississippi River. It purchased the Otis mill in 1997. Previous owners included International Paper, Weyerhauser, James River and Rexam Inc.
While work has rarely stopped since Hugh Chisholm built the mill in 1888, the products changed over time. In the late 1800s, Otis was noted as the largest newsprint mill in the country, according to the Maine Pulp & Paper Association.
Owners gradually shifted from bulk commodity paper to specialty products and niche markets. The chief product now is backing paper used as a base for “peel-and-stick” pressure sensitive labels.
“These highly engineered backing papers are designed for high-speed labeling machines, which apply labels on consumer products such as shampoo and deodorant,” according to the firm’s Web site.
“At Otis, the talented employees have developed a paper that is compatible with UV cured silicones,” the site says. “UV cure coating is one of the fastest growing technologies, and the paper developed at Otis is the first to work with all UV curable systems.”
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