Resolute Forest Products

Environmental Highlights

1. Environmental data is for pulp and paper mills only, except for environmental incidents and ISO 14001 certification, both of which also include sawmills and woodland operations. Data includes Ponderay Newsprint Company (Washington), an unconsolidated partnership in which we have a 40% interest.
2. Scope 1 includes "direct emissions," which come from sources owned or controlled by the company, such as the combustion of fuel at the mill to generate heat to dry paper or to create electricity.
3. Scope 2 encompasses "indirect emissions" (the result of company activities occurring at sources owned or controlled by another company) associated with the production of purchased electricity or steam. Scope 2 emissions physically occur at the facility where electricity or steam is generated. Resolute’s electricity suppliers provide us with their grid emission factors, which the company then includes in its scope 2 emissions data.
4. Represents purchased electricity, minus actual external sales of electricity produced from cogeneration facilities.
5. Resolute returns more than 97% of the water it withdraws. The balance remains within products or evaporates during the manufacturing process.
6. Includes waste used beneficially and for on-site energy recovery.
7. 100% of the woodlands managed by Resolute Forest Products are third-party certified to one of two internationally recognized forest management standards: Sustainable Forestry Initiative^® (SFI^®) or Forest Stewardship Council^® (FSC^®).
8. In its financial statements, the company is required to record accidental releases of hazardous substances significant enough to risk damage to human and environmental health, or that have potential liability and reputational consequences. Between 2012 and 2018, Resolute recorded no such incidents.
9. Material environmental contingencies are disclosed in the footnotes to the company’s consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018. Certain additional proceedings are also disclosed under the heading “Item 3 – Legal Proceedings” in the Form 10-K.
10. Includes 15 ISO 14001-certified pulp, paper and tissue mills, 19 wood products facilities, 1 hydroelectric generation and transmission network and 7 woodlands operations.
11. Includes 18 pulp, paper and tissue mills, 19 wood products facilities, 1 hydroelectric generation and transmission network and 7 woodlands operations.

Social Highlights

1. The lost time incident rate is calculated by multiplying the number of incidents that were lost time cases by 200,000, divided by total number of hours worked.
2. The total incident rate is calculated by multiplying the number of recordable incident cases by 200,000, divided by total number of hours worked.
3. The severity rate is calculated by adding the number of workdays lost to the number of restricted workdays due to injury, multiplied by 200,000 hours worked, divided by total number of hours worked.
4. Employees who leave the organization due to dismissal, retirement or death in service.

Financial Highlights

1. Year ended December 31 (in millions, except per share amounts).
2. Earnings before interest expense, income taxes, and depreciation and amortization, or “EBITDA,” and adjusted EBITDA are not financial measures recognized under U.S. generally accepted accounting principles, or “GAAP.” EBITDA is calculated as net income (loss) including noncontrolling interests from the Consolidated Statements of Operations, adjusted for interest expense, income taxes, and depreciation and amortization. Adjusted EBITDA means EBITDA, excluding special items, such as foreign exchange gains and losses, closure costs, impairment and other related charges, inventory write-downs related to closures, start-up costs, gains and losses on disposition of assets, non-operating pension and other postretirement benefit, or “OPEB,” costs and credits, and other charges or credits. We believe that using non-GAAP measures such as EBITDA and adjusted EBITDA is useful because they are consistent with the indicators management uses internally to measure the company’s performance, and it allows the reader to more easily compare our operations and financial performance from period to period. EBITDA and adjusted EBITDA are internal measures and, therefore, may not be comparable to those of other companies. These non-GAAP measures should not be viewed as substitutes to financial measures determined under GAAP.