<B>More Upbeat News for Paper Companies</B>

>Repap Enterprises Inc. reported its results of operations for the second quarter ended June 30, 2000. Continuing strong operating performance and solid shipments in all product lines as well as higher prices for coated paper and pulp resulted in improved financial results. Earnings before taxes and interest increased by 16% to $49.3 million compared to $42.6 million in the first quarter of 2000 and by 78% from the second quarter 1999 EBITDA of $27.7 million. Repap reported a net income of $0.6 million in the second quarter compared to a loss of $12.5 million in the first quarter of 2000 and a loss of $13.5 million in the second quarter of 1999.

Revenues were $183.7 million, up 29% or $41.3 million from revenues of $142.4 million in the second quarter of 1999. The increase in revenues is attributable to improved coated paper and pulp markets. Shipments of paper increased 12,000 tons or 11% over the second quarter of 1999 and corresponding revenues increased by $32.6 million or 26% to $157.0 million over the same period last year. Pulp shipments increased 10,000 metric tons or 63% over the second quarter of 1999 and revenues increased by $8.1 million or 65% to $20.5 million over the same period. Lumber revenues were relatively flat at $6.2 million.

Cascades Inc. announces that it has doubled its net earnings for the second quarter principally due to the strong performance of its packaging products. Net earnings totaled $24 million, compared with $12 million for the corresponding quarter in 1999. Net earnings for the second quarter were more than twice those recorded during the first quarter 2000, at $11 million. Net sales increased by 13%, from $635 million during the second quarter of 1999 to $717 million during the same period in 2000. Net earnings before interest, taxes, depreciation and amortization amounted to $89 million for the quarter ended June 30, 2000, compared with $80 million one year ago.

Excluding unusual items, net earnings for the second quarter of 2000 were $22 million, compared with $16 million in the prior year. 

Laurent Lemaire, president and CEO, stated: ``These results are very encouraging. The productivity gains achieved at the majority of our mills allowed us to profit from selling price increases of our various recycled fiber based products, the average cost having stabilized during the quarter. Recent decreases in the price of waste papers will put an end to the absorption of price increases of its raw materials.''

Gaylord Container Corp. reported a profit of $0.4 million for the third quarter of fiscal 2000 ended June 30. This compares to a net loss of $8.0 million in the third quarter of fiscal 1999.

Net sales increased to $299 million in the third quarter of fiscal 2000, compared to $229 million in the year-earlier period. The consolidation of S&G Packaging accounted for approximately 60 percent of this increase. The company reported operating earnings of $23.3 million for the fiscal third quarter, a 120% gain over last year's third quarter results. During the quarter, Gaylord took approximately 25,000 tons of mill downtime, the vast majority of which was market-related.

Commenting on the third fiscal quarter, Gaylord's chairman and CEO Marvin Pomerantz said, ``Higher average selling prices for all of our products partly offset by reduced mill volumes and higher recovered fiber costs were primary contributors to the company's improved performance compared to the same quarter last year.''

Looking ahead, Pomerantz remarked, ``Gaylord's demand and prices for corrugated and other brown paper packaging remains solid as the company enters the summer season. Nevertheless, as the US economy slows, Gaylord continues to monitor market conditions carefully in order to match its primary production to demand for its converted products.'' Depending upon market conditions, the company could accumulate as much or more mill downtime in the upcoming quarter as it took during the third fiscal quarter.

Production of containerboard decreased to 317,000 tons for the third quarter of fiscal 2000 compared to 332,000 tons in the fiscal 1999 third quarter. Unbleached kraft paper production increased to 68,000 tons versus 66,000 tons for the same quarter in fiscal 1999. Corrugated shipments for the third quarter were unchanged from the 3.9 billion square feet reported during the year-ago quarter.