Domtar is reporting a quarterly net profit of $124 million in its 4th quarter of 2009. In comparison, Domtar reported a net loss of $676 million in its 4th quarter of 2008.

In the 4th quarter of 2009, Domtar received a tax credit of $162 million through alternative bio fuel mixture programs.

“We had improved pricing for our products in the fourth quarter when compared to the third quarter. In Papers, we recorded another solid performance despite it being a seasonally slower period, with lower volumes and higher maintenance costs. Our paper inventories were reduced for a fifth consecutive quarter contributing to cash flow,” said John D. Williams, President and Chief Executive Officer.

“We also moved forward with the Canadian Pulp and Paper Green Transformation Program submitting numerous projects to Natural Resources Canada during the quarter. We completed the environmental assessment for one project while six others are currently undergoing their assessments,” added Mr. Williams.

Domtar has recorded net earnings of $310 million ($7.18 per share) for its fiscal year of 2009, compared to a net loss of $573 million ($13.33 per share) for fiscal year 2008.

Commenting on the 2009 performance, Mr. Williams said, “While we faced a high level of lack-of-order downtime and a steep decline in pulp prices in the first half of the year, we benefited from stable prices in papers and kept our inventories low. Meanwhile, our efforts to reduce working capital and lower fixed costs proved to be a catalyst for the second half of 2009. The sustained focus on customers, costs, and cash helped us deliver a stronger company to our shareholders and to start 2010 with optimism.”

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Domtar Corporation reports preliminary fourth quarter and fiscal year 2009 financial results (Domtar)