Forest products sector improved, PwC

Aggregate
sales revenues for the largest 100 forest, paper and packaging
companies increased by 9% to US$339.1 billion in 2010 from US$310.8
billion in 2009, reflecting a full year of both volume and sales price
increases which began in late 2009.

The market recovery for forest and paper products also led to an
improvement in net income, with the 100 largest firms posting aggregate
profits of US$18.3 billion, over 3 times the 2009 profits of US$5.1
billion.

"The extent of the recovery was uneven across sectors and countries,"
said Bruce McIntyre, leader of PwC Canada's Forest, Paper and Packaging
industry practice. "Input costs rose strongly, and export-oriented
companies based in strong currency countries such as Canada did not
perform as well due to continued US dollar weakness during 2010."

The annual PwC Global Forest, Paper and Packaging survey, now in its 14^th year, summarizes the publicly available year-over-year financial
information of the PwC Top 100―the 100 largest forest, paper and
packaging companies in the world, ranked by sales revenue.

The composition of the PwC Top 100 remained relatively stable. For the
second year emerging market participation in the PwC Top 100 stalled,
although those represented generally moved up the list. There were 11
Canadian forest, paper and packaging companies on the 2010 PwC Top 100
list – six from the West and five from the East. Two of these 11
companies, Interfor and Western Forest Products, were new to the list
in 2010.

Canadian forest, paper and packaging producers in the 2010 PwC Top 100
list recorded sales revenue growth of 16% to US$26 billion from US$22
billion in 2009, in large part due to strengthening markets. Combined
net earnings for the 11 Canadian companies in the list swung from a
loss of US$2.0 billion in 2009 to positive net earnings of US$3.3
billion in 2010.

McIntyre added: "The improvement trend in the forest products sector
during 2010 continued into the second quarter of 2011, although weaker
prices and challenging economic conditions in key markets contributed
to mixed results in the third quarter."

A copy of the 2011 PwC Global Forest, Paper and Packaging Industry
Survey is available for download at: www.pwc.com/fpp