Document jgjMLgVrD65pwQaB0jO1mqkV2

SGP 0032603 37TH ANNUAL REPORT FOR THe YEAR ENOEO DECEMBER St. 1883 V-1 -\f: GEORBIA-PACIFIC CORPORATION s CONTENTS! 2 Highlight* 3 LattartoStoekholdem 7 Financial fMaw 9 Timber 14 Manutaeturfng 19 RjMuich and Davslopmant 20 Markettng/Clstributloo/Pnxfiicta 23 8MamantarConsafldstodloeoaia 24 Consolidated Bateice Stott 26 Statements of Consofldated Surplus 27 Accountants'Letter 28 Racoid of Oparattons 30 Summary of Consofldtted Financial Condition 4 Kraft Pulp, Paperand Contalnartxjand Demand 4 Plywood Dtmand 4 Ctamkafa and Chemical Products Dtmand 4 Natural Qas and Oat Liquids Demand 6 Tan Years of 8alas Growth 6 Capital Expesdituras for NewPlants A Equipment and Depredation 6 Assets Employed In the Business 6 Fund* Provided and Their Dtoot&ion for 1963 MAN Intide Back Cover MajorGeorgia-Pacific Locations Genual Omcea and WBmgur Divhmp Headquahers EquBaHa Bonding, Porttrad 4. Oregon New You Executive Office 373 Park Avenue, Nttr York 23, Nee York Cnoaam Dtnsnii HeaDQUABTEU Croaett, Arkansai NgETHEASTESN DIVISION HEADQUAITEU 777 Summer Street, Stamford, Connection Puget Sound Division HenDquiuaats tOO laurel Street, Beltmgham,Washington Southern Division HunqiMtrau Southern Finance BmUiag, Augusta. Georgia X. i>! H C> O) LH SGP 0032604  TIMBER ; j , ^ Ownership of limber and tiinhcrlands .is one of Georgia-Pacific's great strengths. During 1963 the Corporation added 325.000 acres of new timberiands. The Corporation's outright ownership of timber now totals about 2.5 million acres, supporting approx imately 20 billion board feet of timber in the United States and over 2 billion board feet in Canada. In addition to the lands owned jn fee. the Corporation has cutting rights to about 2 billion board feet of timber in the Republic of the Philippines. Ketchikan Pulp Company. 50% owned by Gcorgia-Pacilic. has cutting rights in Alaska's Tongttss \'ational Forest covering over X billion board feel of timber. Timber supply from the Cor poration's own lands is supplemented by purchases of public and other timber when it appears advantageous to buy on the open market. Timberiands are operated to provide a perpetual supply of raw material for all exist ing plants. More timber is being grown each year than is required for production. Mod ernization. new plants altd integration have resulted in the operations returning more profit--but using less limber. Lands arc scientifically managed under a Corporate policy of "dynamic conservation." Its purpose is to grow the most timber possi- G ;a T >; H O O) SGP 0032605 Zip a 10 bio per acre perpetually and to harvest this fiber at the peak of its productivity. By doing this the Corporation can produce several crops on ccnaiif Motherlands in the same time it took Nature to produce just one. Douglas lir timbcrlands arc "clear cut" in patches so all the trees on a setting are har vested at one lime. The logged land is im mediately prepared for seeding or handplant ing with seedlings. All other kinds of timber are harvested "selectively" with only certain ripe trees being removed and the younger growth left to mature and to seed the land. A two-year supply of tree food is placed in the ground with each handplantcd seedling, assuring fast, strong growth in the crucial early years. Studies in forest genetics arc pro gressing to produce a superior strain of trees. Natural resources other than timber exist in certain areas owned by Georgia-Pacific and the Corporation twits the underlying mineral rights on practically all its fee lands. On itstintberlands the Corporation has 209 operating natural gits wells. Gcorgia-Pacilic leases the rights to explore, drill for. produce and market natural gas and oil to various companies on a royalty basis. The Corporation also owns deposits of (jdtmui'PitriJir Dnn^ka fir router in Washinuuw Sitrtf. o iO' X O CD SGP 0032606 luol) L'lado i'ili::iim-,ii' .o.ii. oMimalod al .iK'a" 'M..(iiMi.tiitti tccnvor.il'!.- i.'ns^ Ihiv v-o.i! i- iw.i ::..ii:ilv t.n 'i.vipi.- tliiclion AppriAiii.iloiv Tic. >! ino rc'orvc' arv provtHl} ink!.: lc..-'.- in .iln'ia 2>> .ip.miyv. mIki pjv .1 vi jIiv wIikIi t. ..J iii'tcd upward a' ni.iil.ci p:iio- rive-. (1.-!j:i.i-P.iviik li.i' in.iJ.- iiv timlvilan.!. .iv.iil.i!<!c i!k- pni'l'c t-*r I.M.- In pr.'vidiim poci, I ;c. rcali.'ii .no.!'. U.01 12<.(MU> lislsoinion, a.iiHor' r.ii.01' va'i'por' and hiIh"' I'Ov! <'.;'*r.ili.`ii '.iiiil' ;n;_* ilto vo.tr (ic.'t.'M-P.iO'lic'v iimlvr -iini imil'crl.mvS OOIIIIIIUO (' 'lnro.ivo II) V.illlO. Q sO I o 0) SGP 0032607 1 \. I M ij i ! i r* * i* i i i ) manufacturing The year 1963 was very significant for Georgia-Pacific in Ihe development of more efficient manufacturing facilities in the fields of pulp, paper, chemicals and plywood. New areas of pulp and paper manufacture included high grade sulphite pulp, a complete line of fine printing and commercial papers and a wide range of household tissue prod ucts. The addition of tissue manufacture on the West Coast makes Georgia-Pacific one of the few companies with national produc tion and distribution of a full line of house hold tissues. Chemical products were expanded to include ethyl alcohol and a wide variety of chemicals used in agriculture. petroleum exploration, adbesivbs. cement dispersion and production of vanillin. To supplement existing pulp and paper facilities. Georgia-Pacific completed con struction of an 85-ton-a-day household tissue mill at Crossett. Arkansas, and has virtually completed the expansion of the Kraft paper and containerboard mill at Toledo. Oregon from 600 tons to 900 tons a day capacity. Construction is underway on two 500-ton-aday bleached kraft pulp mills, one at Samoa (Eureka), California, and the other at Woodland. Maine. These latter mills repre sent two innovations-the first use of redwood "waste" fiber for pulp at Samoa and * n Q iO X ^i H O 0> Tkm GrtuyfaJ'aaftc plptoad plants at Sprintfield. Oman produce rtbtr-Pfr and Datmlta fir panels. SGP 0032608 ZIO 2 P3g siS is the first use of hardwodd for pulp in the W oodland area. Output of the Samoa mill will go to domestic and export markets tvhilc that of the Woodland mill will be used by paper mills of the Corporation's Northeast ern Division. An 8S-ton-a-day paper towel ing mill at Bellingham. Washington, with attendant pulp facilities, and a paper bag plant at Crossed will be Started this year. The Corporation developed the nation's first Southern pine plywood plant at Fordycc. Arkansas. The new pldnl. now in operation, will have an annual capacity of 90 million square feet and is integrated with the Cros sed. Arkansas operations. ,ViVir "/ Grttrtfti-Pitrifir chemical plant at Coos Bay, On Afnal inr of BHlutuhant. Washington ptrip. tissue <nul tHcwtcal plants. G iO X 0) SGP 0032609 16 At year end. construction was well along on a new. automated redwood lumber mill at Samoa. California. Completed during the year was construction of a formaldehyde plant and a hardboard tempering plant at Coos Bay. Oregon; expansion of Iht corru gated container plant at Modesto. California: construction of a Philippine mahogany ve neer mill at Lumen Buy. Repubjic of the Philippines and a new. all-electric lumber mill near New Richmond. West Virginia. The current plant census, including those already under construction, is eighty-one plants. Seventy-eight of these arc in the United States: two are in Canada and one in the Republic of the Philippines. Fittest prefinished /wrrfiifW ptyuuntds are prmhtced <u Savannah. Gcorfta. Stmioa Eurrka. California plant area mf/f *c*i 50Q-u*n~a-ita* kratt pulp unit me *ilt >ifcd hnci m lorrcntuml: phn inn! plant, r.-JurW tawmin. renter tJittreJ hnei. and onumat rcJun.ni wmnuU in fotrkvnnmd. 0) SGP 0032610 GCHAT 06 RESEARCH AND DEVELOPMENT Georgia-Pacific research scientists have found ways to convert wood and wood fiber into new and better products. Development of chemicals from wood waste and pulp mill liquors has been one of Georgia-Pacific's mdin objectives in its re search program. The Corporation's joint project with a major chemical company on the cooperative development of food prod ucts and an accompahying group of by-prod uct chemicals from waste sawdust and bark is now at the pilot plant stage. Definite con clusions about commercialization of the process have not been made yet The project continues to show promise and final answers should be forthcoming in the near future. Chemical products in commercial produc tion are lignosulfonate, formaldehyde, resins, alcohol, soil additives, charcoal, tall oil, tur pentine and acetic acid. Continuing pilot plant operations and development are ex pected to lead to further profitable products. in 1963 most of Georgia-Pacific's research activities were decentralized and more closely aligned with key manufacturing facilities. Decentralized research on paper and paper products, laminates, chemicals and wood by products is bringing more practical results in a shorter time. Resulting products can be brought to market much sooner. Intriguing new products will continue to flow from Georgia-Pacific's research effort. Researchers mwfc in Oregon pilot plant, determining mast profitable means of extnuimg valuable dienucnb fnmt waste wood fiber. 1 SGP 0032611 MARKETING / DISTRIBUTION / PRODUCTS Distributing and marketing Georgia-Pacific's long list of forest products requires an aggressive and varied program in order to meet the challenge of strong com petition. A nationwide distribution system of 51 Corporation-owned sales offices and 82 distribution centers is responsiblefor market ing the tremendous annual output of paper and paper products, building materials and chemicals. Located in major market areas and at mill sites, these sales centers serve ap proximately 30,000 dealer and industrial ac counts using the various products. During 1963 nine distribution centers for building materials were replaced with new, efficiency- oriented structures. Aggregate floor space of such Corporation-owned centers now totals over 2,100,000 square feet. Export and import activities are important in the Corporation's sales picture with export gaining increasing emphasis. Representatives for Georgia-Pacific are located in 40 freeworld nations. The growing use of paper in overseas markets is causing a sharp increase of pulp and paperexports by Georgia-Pacific. Substantial investments in advertising and sales promotion have been made during 1963 and ate planned for 1964 and the future. These investments are designed to increase sales of high profit products and to launch GCHAT 06 D %g COb SGP 0032612 upgrade our profils. Advertising and merchandising emphasis during the year have been directed mainly at plywood of all kinds, including factory fin ished hardwoods, Fiber-Ply, overlaid panels; paper and paper products, including kraft paper and containerboard, grocer bags and sacks, corrugated containers, fine printing and offset papers, bleached foodboard, news print and household tissues. Also subject to some hard-hitting campaigns were hardboard, fiakeboard and particleboard, red wood lumber and specialties. Southern lum ber products, charcoal and chemicals. Portaged Georgia-Pacific building products art at- snawr "to and Gcortfa'Pacifrc paper and paper products are sold nationally and throughout the free world. Tirt hundred tad nine active veils tap natural gas resources under Georgia-Pacific limherlautls. Ocw/ deposits of 256 million urns underlie some of these funds and are worked under lease arrangements. Exclusixe Georgia-Pottfic ittlatd paneling sets a drainane mood. o iO X 0> tf 1 SGP 0032613 These household tissue produets are produced fry Georgia-Pacific and marketed Inun coast to coast. Georgia-Pacific forest products arc shipped abroad to ftmy free-world uarituts. Here lumber (on deck! and plywood and bleached pulp are cn route to foreign destinations. zp g P.3 g ?|S <o 3. H iS?8 tZ 3^. a3%^2 d r Q iO I 0) yi SGP 0032614 AJOR LOCATIONS iP Ail fir <3 \ P M P \.j* ft '***'' \ **: i :'ri ' l . .* tejsw 0 LEGEND A mBBUAHOS * PUNTS > salts & asmwon cmm || Atmmismme omccs :0 , I: 5 ro. o> C3 i -C On SGP 0032615