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Verso Paper Corp. Reports Preliminary Results For Fourth Quarter And Year Ended December 31, 2011, And Announces Plan To Report Final Results And Host Conference Call On March 7, 2012

Verso Paper Corp. (NYSE: VRS) today announced preliminary results for the fourth quarter and the year ended December 31, 2011. Verso estimates the following results:

  • For the three-month period ended December 31, 2011, we expect Adjusted EBITDA to be within the range of $45 million to $50 million, and for the year ended December 31, 2011, we expect Adjusted EBITDA to be within the range of $200 million to $205 million.
  • Adjusted EBITDA for the three-month period ended December 31, 2011, excludes charges from special items of approximately $45 million primarily related to the shut-down of three paper machines, goodwill impairment, and hedging transactions. Adjusted EBITDA for the year ended December 31, 2011, excludes charges from special items of approximately $80 million primarily related to net losses on debt refinancing, the shut-down of three paper machines, goodwill impairment, and hedging transactions.
  • For the three-month period ended December 31, 2011, we expect operating income before items to be within the range of $14 million to $19 million. Including approximately $52 million of charges primarily related to the paper machine shut-downs, goodwill impairment and hedging transactions we expect operating losses within the range of $38 million to $33 million for the quarter. For the year ended December 31, 2011, we expect operating income before items to be within the range of $74 million to $79 million. Including approximately $60 million of charges primarily related to the paper machine shut-downs, goodwill impairment and hedging transactions we expect operating income within the range of $14 million to $19 million for 2011.
  • Cash and total debt at December 31, 2011 were approximately $95 million and $1.2 billion, respectively. At December 31, 2011, our existing $200 million revolving credit facility had no amounts outstanding, approximately $41 million in letters of credit issued, and approximately $159 million available for future borrowing.
  • Capital expenditures for the three-month period ended December 31, 2011, are expected to be approximately $23 million.

Conference Call

Verso intends to release its financial results for the fourth quarter and the year ended December 31, 2011, in a news release to be issued before the market opens on Wednesday, March 7, 2012. Management will host a conference call at 9 a.m. (Eastern Time) on Wednesday, March 7, 2012, to discuss the fourth quarter and year-end results. Analysts and investors may participate in the live conference call by dialing 719-325-4795 or, within the U.S. and Canada only, 877-591-4959, access code 5749765. To register, please dial in 10 minutes before the conference call begins. The conference call and presentation materials will be made available on Verso’s website at www.versopaper.com/investorrelations by navigating to the Events page, or at http://investor.versopaper.com/eventdetail.cfm?EventID=108162. The earnings release and Verso’s annual report on Form 10-K for the year ended December 31, 2011, will be made available on Verso's website at www.versopaper.com/investorrelations by navigating to the Financial Information page. A telephonic replay of the conference will be accessible at 719-457-0820 or, within the U.S. and Canada only, 888-203-1112, access code 5749765. This replay will be available starting on March 7, 2012, at 12:00 p.m. (Eastern Time) and will remain available for 14 days.

Reconciliation of Estimated Operating Income to Estimated Adjusted EBITDA

The agreements governing our debt contain financial and other restrictive covenants that limit our ability to take certain actions, such as incurring additional debt or making acquisitions. Although we do not expect to violate any of the provisions in the agreements governing our outstanding indebtedness, these covenants can result in limiting our long-term growth prospects by hindering our ability to incur future indebtedness or grow through acquisitions.

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