Left to Right: Arnold M. Nemirow, Chairman, President and Chief Executive Officer, is pictured with Nova Scotia’s Premier, John Hamm, and Boisfeuillet Jones, Jr., Publisher and Chief Executive Officer of The Washington Post Company. The Mersey mill in Liverpool, Nova Scotia, celebrated its 75th anniversary in 2004. The occasion was used to announce that Bowater would dedicate 1,186 acres of old growth Acadian forest to conservation under the company’s Unique Areas program.

Bowater Mills Provide Flexibility
for Changing Markets

Customer needs for coated and uncoated specialty papers are constantly changing and growing. For several years, Bowater has worked to enhance its product offering. Now the company is moving toward a well-balanced portfolio of products, offering an increasing assortment of value-added grades. Bowater is the only manufacturer headquartered in North America that offers the full spectrum of mechanical grades ranging from newsprint to coated paper.

Through acquisitions and product innovation, we have developed a flexible manufacturing platform with the capability to quickly meet the changing needs of our customers.

In 2004, new coated and specialty grades were developed to address the growing demand for inserts, circulars and flyers. Our paper products now include 10 major grades, from just three major grade offerings five years ago. Today, newsprint represents 42% of our overall sales compared to 55% just five years ago. Higher value coated and specialty papers now comprise 28% of our sales with the balance from market pulp and lumber. We have accomplished the development of a flexible production platform through the dedicated work of our employees. Throughout the company, they remain focused on improving our competitive position.