Domtar cutting 790 jobs
The strong Canadian dollar is being blamed for big cuts at Domtar. The forest products company has announced it will shut down its pulp mill in Cornwall, Ont., and eliminate 790 jobs by the end of 2005.
The Cornwall shutdown, which also includes the paper machine and sheeter located at the plant, will eliminate about 390 jobs, effective March 8, 2005.
The remaining 400 jobs will be eliminated from the company's other Canadian and U.S. operations, including management, by the end of next year.
"Domtar must take the necessary steps to face worldwide competition," company president and CEO Raymond Royer said Thursday.
"The Cornwall decision as well as the reduction of a further 400 positions will contribute to our previously announced objective of improving our profitability by $200 million," he said.
On Oct. 28, Domtar reported a third-quarter profit of $29 million (13 cents a share) compared with $3 million (1 cent a share) in the third quarter of 2003. The company's revenue for the quarter improved to $1.34 billion, up from $1.27 billion last year.
At the time the quarterly results were released, Royer said the rise of the loonie against the weakened U.S. dollar had cost Domtar about $140 million in operating profits in the first three quarters of its fiscal year.