viewResolute Forest Products

Resolute closes paper machine at Alma mill; capacity reduced, 85 jobs eliminated


Resolute Forest Products (NYSE:RFP) (TSE:RFP) is permanently shutting down its #9 paper machine at its mill in Alma, Quebec, resulting in about 85 lost jobs and a reduction of 75,000 metric tons of annual production capacity.

The company said its decision to reduce its production capacity for specialty papers is driven by market weakness, exacerbated by fiber cost issues in Quebec, as well as ongoing "misinformation campaigns" by Greenpeace and other environmentalist groups.

"Greenpeace's ill-founded attacks misrepresent the company's forest management practices and cast unwarranted doubt on Resolute's compliance with Quebec's Loi sur l'aménagement durable du territoire forestier and our sustainability leadership," said president and chief executive officer Richard Garneau.

Shares in Toronto rose 0.9 percent to C$22.14 as of 10:30am ET on Friday, extending year-to-date gains to 8 percent.

"Quebec's forest management regime is among the best in the world, and the government ensures strict compliance. The regime deserves to be respected and upheld, and we are calling upon the Quebec government to continue to defend its standards and to refute these unjustified and unfounded attacks," continued Garneau.

The CEO said these campaigns have further destabilized the industry and have triggered socioeconomic consequences for the communities that depend on the boreal forest to make a living.

The Alma paper mill employs about 340 people in total, and has annual production capacity of 350,000 metric tons of specialty papers, across three different machines. Machine #9 will close at the beginning of April, Resolute said.

The company will work with union representatives and government officials to respond to the needs of the affected staff, it added.

Quick facts: Resolute Forest Products

Price: 3.07 CAD

Market: TSX
Market Cap: $268.19 m

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