10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM    TO

COMMISSION FILE NUMBER: 001-33776

RESOLUTE FOREST PRODUCTS INC.

(Exact name of registrant as specified in its charter)

Delaware	98-0526415
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification number)

111 Robert-Bourassa Boulevard	Suite 5000	Montreal	Quebec	Canada	H3C 2M1
(Address of principal executive offices) (Zip Code)

(514) 875-2160

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of class	Trading Symbol	Name of exchange on which registered
Common Stock, par value $0.001 per share	RFP	New York Stock Exchange
		Toronto Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

    Yes ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

    Yes ☒    No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐ Accelerated Filer ☒ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

    Yes ☐    No ☒

As of July 30, 2021, there were 79,108,264 shares of Resolute Forest Products Inc. common stock, $0.001 par value, outstanding.

RESOLUTE FOREST PRODUCTS INC.

TABLE OF CONTENTS

	Page Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2021 and 2020	1
Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2021 and 2020	2
Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020	3
Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2021 and 2020	4
Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020	6
Notes to Unaudited Interim Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3. Quantitative and Qualitative Disclosures About Market Risk	46
Item 4. Controls and Procedures	46
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	47
Item 1A. Risk Factors	47
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	47
Item 6. Exhibits	48
SIGNATURES	49

PART I.    FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in millions of U.S. dollars, except per share amounts)

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Sales	$	1,140	$	612	$	2,013	$	1,301
Costs and expenses:
Cost of sales, excluding depreciation, amortization and distribution costs		566		464		1,088		988
Depreciation and amortization		40		40		81		82
Distribution costs		93		79		177		178
Selling, general and administrative expenses		36		32		82		66
Closure costs, impairment and other related charges		(1)		—		2		(2)
Net gain on disposition of assets		—		(9)		—		(9)
Operating income (loss)		406		6		583		(2)
Interest expense		(5)		(9)		(11)		(18)
Non-operating pension and other postretirement benefit credits		3		4		5		19
Other (expense) income, net		(49)		10		(94)		38
Income before income taxes		355		11		483		37
Income tax provision		(87)		(5)		(127)		(32)
Net income including noncontrolling interest		268		6		356		5
Net income attributable to noncontrolling interest		—		—		(1)		—
Net income attributable to Resolute Forest Products Inc.	$	268	$	6	$	355	$	5
Net income per share attributable to Resolute Forest Products Inc. common shareholders:
Basic	$	3.37	$	0.07	$	4.42	$	0.06
Diluted	$	3.34	$	0.07	$	4.39	$	0.06
Weighted-average number of Resolute Forest Products Inc. common shares outstanding:
Basic		79.5		88.1		80.4		88.1
Diluted		80.3		88.2		81.1		88.2

See accompanying notes to unaudited interim Consolidated Financial Statements.

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RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited, in millions of U.S. dollars)

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net income including noncontrolling interest	$	268	$	6	$	356	$	5
Other comprehensive income:
Unamortized prior service costs or credits
Change in unamortized prior service costs or credits		(2)		(1)		(3)		(16)
Income tax provision		—		—		—		—
Change in unamortized prior service costs or credits, net of tax		(2)		(1)		(3)		(16)
Unamortized actuarial losses
Change in unamortized actuarial losses		19		15		68		32
Income tax provision		(4)		(4)		(16)		(7)
Change in unamortized actuarial losses, net of tax		15		11		52		25
Foreign currency translation		—		—		—		(1)
Other comprehensive income, net of tax		13		10		49		8
Comprehensive income including noncontrolling interest		281		16		405		13
Comprehensive income attributable to noncontrolling interest		—		—		(1)		—
Comprehensive income attributable to Resolute Forest Products Inc.	$	281	$	16	$	404	$	13

See accompanying notes to unaudited interim Consolidated Financial Statements.

2

RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited, in millions of U.S. dollars, except per share amount)

	June 30, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	177	$	113
Accounts receivable, net:
Trade		309		230
Other		35		48
Inventories, net		492		462
Other current assets		53		47
Total current assets		1,066		900
Fixed assets, less accumulated depreciation of $1,681 and $1,604 as of June 30, 2021 and December 31, 2020, respectively		1,406		1,441
Amortizable intangible assets, less accumulated amortization of $36 and $33 as of June 30, 2021 and December 31, 2020, respectively		60		63
Goodwill		31		31
Deferred income tax assets		796		915
Operating lease right-of-use assets		54		60
Other assets		415		320
Total assets	$	3,828	$	3,730
Liabilities and equity
Current liabilities:
Accounts payable and other	$	520	$	369
Current portion of long-term debt		3		2
Current portion of operating lease liabilities		9		9
Total current liabilities		532		380
Long-term debt, net of current portion		300		559
Pension and other postretirement benefit obligations		1,482		1,562
Operating lease liabilities, net of current portion		50		55
Other liabilities		77		92
Total liabilities		2,441		2,648
Commitments and contingencies
Equity:
Resolute Forest Products Inc. shareholders’ equity:
Common stock, $0.001 par value. 121.0 million shares issued and 79.1 million shares outstanding as of June 30, 2021; 120.6 million shares issued and 80.8 million shares outstanding as of December 31, 2020		—		—
Additional paid-in capital		3,805		3,804
Deficit		(961)		(1,235)
Accumulated other comprehensive loss		(1,265)		(1,314)
Treasury stock at cost, 41.9 million shares and 39.8 million shares as of June 30, 2021 and December 31, 2020, respectively		(194)		(174)
Total Resolute Forest Products Inc. shareholders’ equity		1,385		1,081
Noncontrolling interest		2		1
Total equity		1,387		1,082
Total liabilities and equity	$	3,828	$	3,730

See accompanying notes to unaudited interim Consolidated Financial Statements.

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RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited, in millions of U.S. dollars)

	Three Months Ended June 30, 2021
	Resolute Forest Products Inc. Shareholders’ Equity
	Common Stock		Additional Paid-In Capital		Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Non-controlling Interest		Total Equity
Balance as of March 31, 2021	$	—	$	3,802	$	(1,148)	$	(1,278)	$	(191)	$	2	$	1,187
Share-based compensation, net of withholding taxes		—		1		—		—		—		—		1
Net income		—		—		268		—		—		—		268
Purchases of treasury stock (0.3 million shares) (Note 12)		—		—		—		—		(3)		—		(3)
Special dividend		—		2		(81)		—		—		—		(79)
Other comprehensive income, net of tax		—		—		—		13		—		—		13
Balance as of June 30, 2021	$	—	$	3,805	$	(961)	$	(1,265)	$	(194)	$	2	$	1,387
	Six Months Ended June 30, 2021
	Resolute Forest Products Inc. Shareholders’ Equity
	Common Stock		Additional Paid-In Capital		Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Non-controlling Interest		Total Equity
Balance as of December 31, 2020	$	—	$	3,804	$	(1,235)	$	(1,314)	$	(174)	$	1	$	1,082
Share-based compensation, net of withholding taxes		—		(1)		—		—		—		—		(1)
Net income		—		—		355		—		—		1		356
Purchases of treasury stock (2.1 million shares) (Note 12)		—		—		—		—		(20)		—		(20)
Special dividend		—		2		(81)		—		—		—		(79)
Stock unit awards vested (0.4 million shares), net of shares forfeited for employee withholding taxes		—		—		—		—		—		—		—
Other comprehensive income, net of tax		—		—		—		49		—		—		49
Balance as of June 30, 2021	$	—	$	3,805	$	(961)	$	(1,265)	$	(194)	$	2	$	1,387

4

RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited, in millions of U.S. dollars)

	Three Months Ended June 30, 2020
	Resolute Forest Products Inc. Shareholders’ Equity
	Common Stock		Additional Paid-In Capital		Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Non- controlling Interest		Total Equity
Balance as of March 31, 2020	$	—	$	3,804	$	(1,246)	$	(1,181)	$	(144)	$	1	$	1,234
Share-based compensation, net of withholding taxes		—		1		—		—		—		—		1
Net income		—		—		6		—		—		—		6
Purchases of treasury stock (0.3 million shares) (Note 12)		—		—		—		—		(1)		—		(1)
Other comprehensive income, net of tax		—		—		—		10		—		—		10
Balance as of June 30, 2020	$	—	$	3,805	$	(1,240)	$	(1,171)	$	(145)	$	1	$	1,250
	Six Months Ended June 30, 2020
	Resolute Forest Products Inc. Shareholders’ Equity
	Common Stock		Additional Paid-In Capital		Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Non- controlling Interest		Total Equity
Balance as of December 31, 2019	$	—	$	3,802	$	(1,245)	$	(1,179)	$	(144)		1		1,235
Share-based compensation, net of withholding taxes		—		3		—		—		—		—		3
Net income		—		—		5		—		—		—		5
Purchases of treasury stock (0.3 million shares) (Note 12)		—		—		—		—		(1)		—		(1)
Stock unit awards vested (0.7 million shares), net of shares forfeited for employee withholding taxes		—		—		—		—		—		—		—
Other comprehensive income, net of tax		—		—		—		8		—		—		8
Balance as of June 30, 2020	$	—	$	3,805	$	(1,240)	$	(1,171)	$	(145)	$	1	$	1,250

See accompanying notes to unaudited interim Consolidated Financial Statements.

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RESOLUTE FOREST PRODUCTS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in millions of U.S. dollars)

	Six Months Ended June 30,
	2021		2020
Cash flows from operating activities:
Net income including noncontrolling interest	$	356	$	5
Adjustments to reconcile net income including noncontrolling interest to net cash provided by operating activities:
Share-based compensation		3		4
Depreciation and amortization		81		82
Deferred income taxes		127		32
Net pension contributions and other postretirement benefit payments		(47)		(48)
Net gain on disposition of assets		—		(9)
(Gain) loss on translation of foreign currency denominated deferred income taxes		(24)		39
Loss (gain) on translation of foreign currency denominated pension and other postretirement benefit obligations		32		(47)
Net planned major maintenance payments		(9)		(2)
Changes in working capital:
Accounts receivable		(61)		50
Inventories		(30)		25
Other current assets		(2)		(7)
Accounts payable and other		36		(49)
Other, net		13		1
Net cash provided by operating activities		475		76
Cash flows from investing activities:
Cash invested in fixed assets		(47)		(37)
Acquisition of business, net of cash acquired		—		(172)
Disposition of assets		—		9
Increase in countervailing and anti-dumping duty cash deposits on softwood lumber		(89)		(32)
Other investing activities, net		3		5
Net cash used in investing activities		(133)		(227)
Cash flows from financing activities:
Net repayments under revolving credit facilities		—		(2)
Issuance of long-term debt		300		—
Proceeds from long-term debt		—		180
Repayments of debt		(557)		(1)
Purchases of treasury stock		(20)		(1)
Payments of financing fees		(7)		—
Other financing activities, net		2		—
Net cash (used in) provided by financing activities		(282)		176
Effect of exchange rate changes on cash and cash equivalents, and restricted cash		—		(1)
Net increase in cash and cash equivalents, and restricted cash	$	60	$	24
Cash and cash equivalents, and restricted cash:
Beginning of period	$	159	$	42
End of period	$	219	$	66
Cash and cash equivalents, and restricted cash at end of period:
Cash and cash equivalents	$	177	$	27
Restricted cash (included in “Other assets”)	$	42	$	39

See accompanying notes to unaudited interim Consolidated Financial Statements.

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RESOLUTE FOREST PRODUCTS INC.

Notes to Unaudited Interim Consolidated Financial Statements

Note 1. Organization and Basis of Presentation

Nature of operations

Resolute Forest Products Inc. (with its subsidiaries, either individually or collectively, unless otherwise indicated, referred to as “Resolute Forest Products,” “we,” “our,” “us,” “Parent,” or the “Company”) is incorporated in Delaware. We are a global leader in the forest products industry with a diverse range of products, including market pulp, tissue, wood products, and paper, which are marketed in over 50 countries. We own or operate some 40 facilities as well as power generation assets, in the U.S. and Canada.

Financial statements

Our unaudited interim consolidated financial statements and accompanying notes (or, the “Consolidated Financial Statements”) have been prepared in accordance with the requirements of the U.S. Securities and Exchange Commission (or, the “SEC”) for interim reporting. Under those rules, certain footnotes and other financial information that are normally required by U.S. generally accepted accounting principles (or, “GAAP”) may be condensed or omitted. In our opinion, all adjustments (consisting of normal recurring adjustments) necessary for the fair statement of the Consolidated Financial Statements have been made. All amounts are expressed in U.S. dollars, unless otherwise indicated. The results for the interim period ended June 30, 2021, are not necessarily indicative of the results to be expected for the full year. These Consolidated Financial Statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021. Certain prior period amounts in the notes to our Consolidated Financial Statements have been reclassified to conform to the 2021 presentation.

New accounting pronouncement adopted in 2021

ASU 2019-12 “Simplifying the Accounting for Income Taxes”

Effective January 1, 2021, we adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes,” issued by the Financial Accounting Standards Board (or, “FASB”) in 2019, which removes the specific exceptions to the general principles in ASC 740, “Income Taxes,” and clarifies certain aspects of the existing guidance. The adoption of this accounting guidance did not impact our Consolidated Financial Statements and disclosures.

Accounting pronouncement not yet adopted as of June 30, 2021

ASU 2020-04 “Reference Rate Reform”

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform,” amended in January by ASU 2021-01, “Reference Rate Reform - Scope,” which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. This update provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform. This update is effective as of March 12, 2020, through December 31, 2022. We are currently evaluating this accounting guidance and have not elected an adoption date. We do not expect this accounting guidance to materially impact our results of operations or financial position.

Note 2. Other (Expense) Income, Net

Other (expense) income, net for the three and six months ended June 30, 2021 and 2020, was comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Foreign exchange (loss) gain	$	(6)	$	(9)	$	(11)	$	14
(Loss) gain on commodity contracts (1)		(49)		—		(86)		4
Insurance recovery (2)		—		15		—		15
Miscellaneous income		6		4		3		5
	$	(49)	$	10	$	(94)	$	38

(1)    Principally related to lumber futures contracts; none of these contracts were outstanding as of June 30, 2021.

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RESOLUTE FOREST PRODUCTS INC.

Notes to Unaudited Interim Consolidated Financial Statements

(2)    We recorded $15 million as other income for the three and six months ended June 30, 2020, from the settlement of an insurance claim in connection with our acquisition of Atlas Paper Holdings, Inc. (or, “Atlas”) in 2015.

Note 3. Accumulated Other Comprehensive Loss

The change in our accumulated other comprehensive loss by component (net of tax) for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2021	$	(2)	$	(1,270)	$	(6)	$	(1,278)
Amounts reclassified from accumulated other comprehensive loss		(2)		15		—		13
Net current period other comprehensive (loss) income		(2)		15		—		13
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)
(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2020	$	(1)	$	(1,307)	$	(6)	$	(1,314)
Other comprehensive income before reclassifications (1)		—		22		—		22
Amounts reclassified from accumulated other comprehensive loss		(3)		30		—		27
Net current period other comprehensive (loss) income		(3)		52		—		49
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)

(1)    The indefinite idling of the Amos and Baie-Comeau (Quebec) mills triggered curtailment and remeasurement of the pension and other postretirement benefit (or, “OPEB”) obligations related to their plans as of March 31, 2021, resulting in a curtailment gain of $8 million and an actuarial gain of $22 million, totaling $30 million ($22 million net of tax).

(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2020	$	1	$	(1,175)	$	(7)	$	(1,181)
Amounts reclassified from accumulated other comprehensive loss		(1)		11		—		10
Net current period other comprehensive (loss) income		(1)		11		—		10
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)
(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2019	$	16	$	(1,189)	$	(6)	$	(1,179)
Other comprehensive loss before reclassifications		—		—		(1)		(1)
Amounts reclassified from accumulated other comprehensive loss		(16)		25		—		9
Net current period other comprehensive (loss) income		(16)		25		(1)		8
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)

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RESOLUTE FOREST PRODUCTS INC.

Notes to Unaudited Interim Consolidated Financial Statements

The reclassifications out of accumulated other comprehensive loss for the three and six months ended June 30, 2021 and 2020, were comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020		Affected Line in the Consolidated Statements of Operations
Unamortized Prior Service Costs or Credits
Amortization of prior service costs or credits	$	(2)	$	(1)	$	(2)	$	(2)	Non-operating pension and other postretirement benefit credits (1)
Curtailment gain		—		—		(1)		(14)	Non-operating pension and other postretirement benefit credits (1)
		—		—		—		—	Income tax provision
Net of tax		(2)		(1)		(3)		(16)
Unamortized Actuarial Losses
Amortization of actuarial losses		19		15		38		29	Non-operating pension and other postretirement benefit credits (1)
Other items		—		—		—		3
		(4)		(4)		(8)		(7)	Income tax provision
Net of tax		15		11		30		25
Total Reclassifications	$	13	$	10	$	27	$	9

(1)These items are included in the computation of net periodic benefit cost (credit) related to our pension and OPEB plans summarized in Note 9, “Employee Benefit Plans.”

Note 4. Net Income Per Share

The reconciliation of the basic and diluted net income per share for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except per share amounts)	2021		2020		2021		2020
Numerator:
Net income attributable to Resolute Forest Products Inc.	$	268	$	6	$	355	$	5
Denominator:
Weighted-average number of Resolute Forest Products Inc. common shares outstanding		79.5		88.1		80.4		88.1
Dilutive impact of nonvested stock unit awards and stock options		0.8		0.1		0.7		0.1
Diluted weighted-average number of Resolute Forest Products Inc. common shares outstanding		80.3		88.2		81.1		88.2
Net income per share attributable to Resolute Forest Products Inc. common shareholders:
Basic	$	3.37	$	0.07	$	4.42	$	0.06
Diluted	$	3.34	$	0.07	$	4.39	$	0.06

The weighted-average number of outstanding stock options and nonvested equity-classified restricted stock units, deferred stock units and performance stock units (collectively, “stock unit awards”) that were excluded from the calculation of diluted

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RESOLUTE FOREST PRODUCTS INC.

Notes to Unaudited Interim Consolidated Financial Statements

net income per share, as their impact would have been antidilutive, for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(Unaudited, in millions)	2021	2020	2021	2020
Stock options	0.4	0.9	0.5	0.9
Stock unit awards	—	0.9	—	0.9

Note 5. Inventories, Net

Inventories, net as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Raw materials	$	132	$	132
Work in process		55		46
Finished goods		138		120
Mill stores and other supplies		167		164
	$	492	$	462

Note 6. Other Assets

Other assets include countervailing and anti-dumping duty cash deposits on softwood lumber of $278 million and $54 million, respectively, as of June 30, 2021, and of $194 million and $49 million, respectively, as of December 31, 2020. See Note 11, “Commitments and Contingencies” for more information.

Note 7. Accounts Payable and Other

Accounts payable and other as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Trade accounts payable	$	300	$	251
Accrued compensation		69		76
Accrued interest		7		4
Pension and other postretirement benefit obligations		15		14
Special dividend payable (1)		79		—
Accrued provision related to Fibrek Inc. litigation (Note 11)		21		—
Income and other taxes payable		5		5
Other		24		19
	$	520	$	369

(1)    On June 10, 2021, we declared a special dividend of $1.00 per share ($79 million) on our common stock. See Note 12, “Share Capital,” for more information.

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Notes to Unaudited Interim Consolidated Financial Statements

Note 8. Long-Term Debt

Overview

Long-term debt, including current portion, as of June 30, 2021 and December 31, 2020, was comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
4.875% senior unsecured notes due 2026:
Principal amount	$	300	$	—
Deferred financing costs		(6)		—
Total 4.875% senior unsecured notes due 2026		294		—
5.875% senior unsecured notes due 2023:
Principal amount		—		375
Deferred financing costs		—		(2)
Unamortized discount		—		(1)
Total 5.875% senior unsecured notes due 2023		—		372
Senior secured credit facility - Term loans due 2030		—		180
Finance lease obligations		7		9
Other debt		2		—
Total debt		303		561
Less: Current portion of finance lease obligations and other debt		(3)		(2)
Long-term debt, net of current portion	$	300	$	559

Senior Unsecured Notes

2026 Notes

On February 2, 2021, we issued $300 million aggregate principal amount of 4.875% senior unsecured notes due 2026 (or, the “2026 Notes”) at an issue price of 100%, pursuant to an indenture as of that date (or, the “Indenture”). Upon their issuance, the 2026 Notes were recorded at their fair value of $300 million. Interest on the 2026 Notes is payable semi-annually on March 1 and September 1 of each year, beginning on September 1, 2021, until their maturity date of March 1, 2026. In connection with the issuance of the 2026 Notes, we incurred financing costs of $6 million, which were deferred and recorded as a reduction of the principal. Deferred financing costs are amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the notes.

The 2026 Notes are guaranteed by current and future wholly-owned U.S. subsidiaries that guarantee the ABL Credit Facility and the Senior Secured Credit Facility (each, as defined and discussed below). The notes are unsecured and effectively junior to indebtedness under each of the ABL Credit Facility, the Senior Secured Credit Facility, the Loan Facility and future secured indebtedness to the extent of the value of the collateral that secures such indebtedness. In addition, the notes are structurally subordinated to all existing and future indebtedness (including the Loan Facility) and other liabilities of our subsidiaries that do not guarantee the notes, including all our non-U.S. subsidiaries.

The terms of the Indenture impose certain restrictions, subject to a number of exceptions and qualifications, including limits on our ability to: incur additional indebtedness or issue certain preferred shares; make dividend payments on or make other distributions in respect of our capital stock or make other restricted payments; make certain investments; sell certain assets; create liens on assets; consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and enter into certain transactions with our affiliates.

In the event of specified change of control triggering events, we shall be required to offer to repurchase the 2026 Notes at 101% of the principal amount, plus accrued and unpaid interest.

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Notes to Unaudited Interim Consolidated Financial Statements

On or after March 1, 2023, we may redeem the notes at our option, in whole at any time or in part from time to time, at redemption prices equal to a percentage of the principal amount plus accrued and unpaid interest, as follows:

Year (beginning March 1)	Redemption Price
2023	102.438	%
2024	101.219	%
2025 and thereafter	100.000	%

The fair value of the 2026 Notes (Level 1) was $311 million as of June 30, 2021.

2023 Notes

We issued $600 million in aggregate principal amount of 5.875% senior unsecured notes due 2023 (or, the “2023 Notes”) on May 8, 2013. Upon their issuance, the 2023 Notes were recorded at their fair value of $594 million, which reflected a discount of $6 million that was being amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the 2023 Notes, resulting in an effective interest rate of 6%. Interest on the 2023 Notes was payable semi-annually beginning November 15, 2013. In connection with the issuance of the 2023 Notes, we incurred financing costs of $9 million, which were deferred and recorded as a reduction of the 2023 Notes. Deferred financing costs were amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the 2023 Notes.

On January 3, 2019, we repurchased $225 million in aggregate principal amount of the 2023 Notes, pursuant to a notes purchase agreement entered into on December 21, 2018, with certain noteholders, at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest.

On February 2, 2021, we placed the net proceeds from the issuance of the 2026 Notes together with additional cash, into trust for the benefit of the holders of the 2023 Notes to redeem all of the $375 million aggregate principal amount of the 2023 Notes (or, the “Redemption”) at a price of 100% of the aggregate principal amount thereof, plus accrued and unpaid interest to, but not including, the redemption date. The Redemption occurred on February 18, 2021. As a result of the repurchase, we recorded a net loss on extinguishment of debt of $3 million in “Other (expense) income, net” in our Consolidated Statement of Operations for the six months ended June 30, 2021.

The fair value of the 2023 Notes (Level 1) was $375 million as of December 31, 2020.

Senior Secured Credit Facility

On September 7, 2016, we entered into a senior secured credit facility for up to $185 million. This senior secured credit facility provided a term loan of $46 million with a maturity date of September 7, 2025, and a revolving credit facility of up to $139 million with a maturity date of September 7, 2022. On October 28, 2019, we entered into an amended and restated senior secured credit facility for up to $360 million, which provided a term loan facility of up to $180 million and a revolving credit facility of up to $180 million with a maturity date of October 28, 2025 for the latter, and repaid our $46 million term loan under the original senior secured credit facility. In March 2020, we borrowed $180 million in term loans for ten years, maturing in March 2030.

On April 19, 2021 (or, the “Effective Date”), we entered into a first amendment to the amended and restated senior secured credit facility (or, the “Senior Secured Credit Facility”). The amount available under the Senior Secured Credit Facility remains unchanged for up to $360 million and is comprised of a term loan facility of up to $180 million with a delayed draw period of up to three years and the choice of maturities of six to ten years from the date of drawing (or, the “Term Loan Facility”); and a six-year revolving credit facility of up to $180 million (or, the “Revolving Credit Facility”). On the Effective Date, we repaid our $180 million term loans under the amended and restated senior secured credit facility with a combination of proceeds of borrowings under the Revolving Credit Facility and cash on hand. The amendment then reinstated the full amount of the Term Loan Facility. There is also an uncommitted option to increase the Senior Secured Credit Facility by up to an additional $360 million, subject to certain terms and conditions.

The obligations under the Senior Secured Credit Facility continue to be guaranteed by certain material U.S. subsidiaries of the Company and remain secured by first priority liens on assets of our Calhoun (Tennessee) facility. Interest rates under the Senior Secured Credit Facility are based, at the Company’s election, on either a floating rate based on the LIBOR, or a base rate, in each case plus a spread over the index. In addition, loans under the Term Loan Facility can bear interest at a fixed rate plus a spread. For loans under the Term Loan Facility, the applicable spread ranges from 0.5% to 1.4% for base rate loans, from 1.5%

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Notes to Unaudited Interim Consolidated Financial Statements

to 2.4% for LIBOR rate loans, and from 1.7% to 2.1% for fixed rate loans. For the Revolving Credit Facility, the applicable spread ranges from 0.5% to 1.0% for base rate loans, and from 1.5% to 2.0% for LIBOR rate loans. The amended credit agreement contains customary covenants, representations and warranties, and events of default.

As of June 30, 2021, we had $180 million of availability under the Term Loan Facility and $180 million of availability under the Revolving Credit Facility, which were undrawn. The fair values of the term loans (Level 2) approximated their carrying values and were bearing interest at LIBOR plus a spread of 2.13% as of December 31, 2020.

ABL Credit Facility

On May 14, 2019, we entered into an amended senior secured asset-based revolving credit facility (or, the “ABL Credit Facility”) with an aggregate lender commitment of up to $500 million at any time outstanding, subject to borrowing base availability based on specified advance rates, eligibility criteria and customary reserves. The amended credit agreement provides for an extension of the maturity date to May 14, 2024.

Effective January 21, 2021, we reduced the commitment under the Canadian tranche of our senior secured asset-based revolving credit facility by $50 million, to $250 million, resulting in an aggregate commitment of $450 million, subject to borrowing base limitations. The obligations under the ABL Credit Facility are guaranteed by certain of our material subsidiaries.

As of June 30, 2021, we had $336 million of borrowing base availability under the ABL Credit Facility, which was undrawn except for $67 million of ordinary course letters of credit outstanding.

Loan Facility

On November 4, 2020, our Canadian subsidiary, Resolute FP Canada Inc., entered into a secured delayed draw term loan facility (or, the “Loan Facility”) with Investissement Québec as lender for up to C$220 million ($177 million as of June 30, 2021), subject to borrowing base availability based on 75% of the countervailing and anti-dumping duty deposits imposed by the U.S. Department of Commerce and collected by Customs and Border Protection Agency on U.S. imports of applicable softwood lumber products produced at sawmills of the Borrower and its affiliates located in the province of Quebec, Canada from April 28, 2017 to December 31, 2022. The Loan Facility will bear interest at a floating rate equal to 1.45% above the one month Canadian banker’s acceptance rate. The principal shall be repayable in monthly installments over a period of eight years after an interest only period of two years from the date of the first draw. The Loan Facility is subject to prepayment requirements under certain conditions and may be repaid earlier without premium or penalty, but subject to prepayment of accrued and unpaid interest. The Loan Facility provides for a maximum of ten draws and the fulfillment of certain conditions upon each draw. Borrowings are subject to certain restrictions.

As of June 30, 2021, we had C$220 million ($177 million) of borrowing base availability under the Loan Facility, which was undrawn.

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Notes to Unaudited Interim Consolidated Financial Statements

Note 9. Employee Benefit Plans

Pension and other postretirement benefit plans

The components of net periodic benefit costs (credits) relating to our pension and OPEB plans for the three and six months ended June 30, 2021 and 2020, were as follows:

Pension Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	34	$	36	$	67	$	74
Expected return on plan assets		(55)		(55)		(109)		(111)
Amortization of actuarial losses		20		17		41		32
Non-operating pension credits		(1)		(2)		(1)		(5)
Service cost		4		3		8		7
Net periodic benefit costs before special events		3		1		7		2
Other (gain) loss		—		—		(1)		3
	$	3	$	1	$	6	$	5

OPEB Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	1	$	1	$	2	$	2
Amortization of actuarial gains		(1)		(2)		(3)		(3)
Amortization of prior service credits		(2)		(1)		(2)		(2)
Non-operating other postretirement benefit credits		(2)		(2)		(3)		(3)
Service cost		—		1		—		1
Net periodic benefit credits before special events		(2)		(1)		(3)		(2)
Curtailment gain		—		—		—		(14)
	$	(2)	$	(1)	$	(3)	$	(16)

Defined contribution plans

Our expense for the defined contribution plans totaled $4 million for the three months ended June 30, 2021 and 2020, and $9 million and $8 million for the six months ended June 30, 2021 and 2020, respectively.

U.S. pension funding

The American Rescue Plan Act of 2021 includes provisions that allow for interest rate smoothing of pension funding deficits to minimize the impact of lower interest rates on liabilities. It also extends the amortization period for funding shortfalls from seven years to 15 years under the current rules. We estimate that the impact of the Act on our previously disclosed estimated contributions for 2021 will be a reduction of $13 million.

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Notes to Unaudited Interim Consolidated Financial Statements

Note 10. Income Taxes

The income tax provision attributable to income before income taxes differs from the amounts computed by applying the U.S. federal statutory income tax rate of 21% for the three and six months ended June 30, 2021 and 2020, as a result of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Income before income taxes	$	355	$	11	$	483	$	37
Income tax provision:
Expected income tax provision		(74)		(3)		(101)		(8)
Changes resulting from:
Valuation allowance on our U.S. operations		70		(7)		78		(16)
Foreign exchange		1		2		3		(10)
U.S. tax on non-U.S. earnings		(65)		—		(83)		—
State income taxes, net of federal income tax benefit		—		—		2		2
Foreign tax rate differences		(19)		(2)		(27)		(5)
Other, net (1)		—		5		1		5
	$	(87)	$	(5)	$	(127)	$	(32)

(1)    Includes $4 million for the three and six months ended June 30, 2020, related to the settlement of an insurance claim in connection with our acquisition of Atlas.

During the three and six months ended June 30, 2021, we used $70 million and $78 million, respectively, of deferred income tax assets that were fully reserved to offset mainly the tax implications relating to the global intangible low-taxed income inclusion, which is based on the U.S. system of taxation for non-U.S. earnings, whereby foreign earnings less a qualified deduction for foreign assets are included in U.S. taxable income.

Note 11. Commitments and Contingencies

Legal matters

We become involved in various legal proceedings, claims and governmental inquiries, investigations, and other disputes in the normal course of business, including matters related to contracts, commercial and trade disputes, taxes, environmental issues, activist damages, employment and workers’ compensation claims, grievances, human rights complaints, pension and benefit plans and obligations, health and safety, product safety and liability, asbestos exposure, financial reporting and disclosure obligations, corporate governance, Indigenous peoples’ claims, antitrust, governmental regulations, and other matters. Although the final outcome is subject to many variables and cannot be predicted with any degree of certainty, we regularly assess the status of the matters and establish provisions (including legal costs expected to be incurred) when we believe an adverse outcome is probable, and the amount can be reasonably estimated. Any recovery from litigation or settlement of claims that is a gain contingency is recognized if, and when, realized or realizable. Except as described below and for claims that cannot be assessed due to their preliminary nature, we believe that the ultimate disposition of these matters outstanding or pending as of June 30, 2021, will not have a material adverse effect on our Consolidated Financial Statements.

Asbestos-related lawsuits

We are involved in a number of asbestos-related lawsuits filed primarily in U.S. state courts, including certain cases involving multiple defendants. These lawsuits principally allege direct or indirect personal injury or death resulting from exposure to asbestos-containing premises. While we dispute the plaintiffs’ allegations and intend to vigorously defend these claims, the ultimate resolution of these matters cannot be determined at this time. These lawsuits frequently involve claims for unspecified compensatory and punitive damages, and we are unable to reasonably estimate a range of possible losses. However, unfavorable rulings, judgments or settlement terms could materially impact our Consolidated Financial Statements. Hearings for certain of these matters are scheduled to occur in the next twelve months.

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Notes to Unaudited Interim Consolidated Financial Statements

Countervailing duty and anti-dumping investigations on softwood lumber

On November 25, 2016, countervailing duty and anti-dumping petitions were filed with the U.S. Department of Commerce (or, “Commerce”) and the U.S. International Trade Commission (or, “ITC”) by certain U.S. softwood lumber products producers and forest landowners, requesting that the U.S. government impose countervailing and anti-dumping duties on Canadian-origin softwood lumber products exported to the U.S. One of our subsidiaries was identified in the petitions as being a Canadian exporting producer of softwood lumber products to the U.S. and was selected as a mandatory respondent to be investigated by Commerce in both the countervailing duty and anti-dumping investigations.

On April 24, 2017, Commerce announced its preliminary determination in the countervailing duty investigation and, as a result, after April 28, 2017, we were required to pay cash deposits to the U.S. Customs and Border Protection agency (or, “U.S. Customs”) at a rate of 12.82% for estimated countervailing duties on the vast majority of our U.S. imports of softwood lumber products produced at our Canadian sawmills. The preliminary rate remained in effect until August 26, 2017. Commerce changed the rate in its final affirmative determination on November 2, 2017, but the new rate did not take effect until December 28, 2017, following the ITC’s final affirmative determination and the publication by Commerce of a countervailing duty order. Until November 30, 2020, we were required to pay cash deposits to U.S. Customs at a rate of 14.70% for the vast majority of our U.S. imports of Canadian-produced softwood lumber products. On December 1, 2020, Commerce issued its final results in the countervailing duties first administrative review and established our new rate at 19.10% for countervailing duties. This rate applies until Commerce sets a new duty rate in subsequent administrative reviews, or a new rate may be set through a remand determination by a binational panel formed pursuant to the North American Free Trade Agreement or United States-Mexico-Canada Agreement, as the case may be (or, “Panel”) on appeal. On May 20, 2021, Commerce issued its preliminary rates in the countervailing duties second administrative review and established our new preliminary rate at 18.17% for countervailing duties. The preliminary rate will not take effect until the publication by Commerce of the final results. During the six months ended June 30, 2021, we made additional cash deposits of $84 million, bringing our total to $278 million.

On June 26, 2017, Commerce announced its preliminary determination in the anti-dumping investigation and, as a result, after June 30, 2017, we were required to pay cash deposits to U.S. Customs at a rate of 4.59% for estimated anti-dumping duties on the vast majority of our U.S. imports of softwood lumber products produced at our Canadian sawmills. On November 2, 2017, Commerce announced its final affirmative determination in the anti-dumping investigation and, as a result, from November 8, 2017 to November 29, 2020, we were required to pay cash deposits to U.S. Customs, at a rate of 3.20% for the vast majority of our U.S. imports of Canadian-produced softwood lumber products. On November 30, 2020, Commerce issued its final results in the anti-dumping first administrative review and established our new rate at 1.15% for anti-dumping duties. This rate applies until Commerce sets a duty rate in subsequent administrative reviews, or a new rate may be set through a remand determination by a Panel on appeal. On May 20, 2021, Commerce issued its preliminary rates in the anti-dumping second administrative review and established the new “all-others” preliminary rate at 12.05% for anti-dumping duties. The preliminary rate will not take effect until the publication by Commerce of the final results. During the six months ended June 30, 2021, we made additional cash deposits of $5 million, bringing our total to $54 million.

On April 1, 2019, Commerce published a notice initiating the administrative reviews of the countervailing duty and anti-dumping orders on softwood lumber products from Canada and we were selected as a mandatory respondent in these administrative reviews. On March 10, 2020, Commerce published a notice initiating the second administrative review of the countervailing duty and anti-dumping orders on softwood lumber products from Canada. We were selected as a mandatory respondent for the second administrative review of the countervailing duty order and we are in the process of responding to Commerce with the information required. On March 4, 2021, Commerce published a notice initiating the third administrative review of the countervailing duty and anti-dumping orders on softwood lumber products from Canada. We were selected as a mandatory respondent for the third administrative review of the countervailing duty order and we are in the process of responding to Commerce with the information required.

In parallel, on September 4, 2019, a Panel issued an interim decision upholding the affirmative final injury determinations of the ITC in both investigations of softwood lumber products from Canada. The Panel remanded the ITC to reconsider several findings and ordered the ITC to submit its redetermination on remand within 90 days from the date of the Panel interim decision. On December 19, 2019, the ITC issued its redetermination on remand that maintained the affirmative final injury determinations, and on May 22, 2020, the Panel issued its final decision and affirmed in its entirety the ITC’s injury determination on remand. On January 6, 2021, and January 19, 2021, we filed our complaints supporting Panel reviews of the final results in the countervailing and anti-dumping first administrative reviews.

In addition, on August 24, 2020, the World Trade Organization’s (or, “WTO”) dispute panel issued a report (or, the “Panel Report”) in the case brought by the government of Canada in “United States — Countervailing Measures on Softwood Lumber

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Notes to Unaudited Interim Consolidated Financial Statements

from Canada” (DS533), concluding, among other things, that Commerce acted inconsistently with the Agreement on Subsidies and Countervailing Measures on most of the matters. On September 28, 2020, the United States notified the WTO’s dispute settlement body of its decision to appeal the Panel Report.

We are not presently able to determine the ultimate resolution of these matters, but we believe it is not probable that we will ultimately be assessed with significant duties, if any, on our U.S. imports of Canadian-produced softwood lumber products. Accordingly, no contingent loss was recorded in respect of these petitions in our Consolidated Statements of Operations, and our cash deposits are recorded in “Other assets” in our Consolidated Balance Sheets.

Fibrek acquisition

Effective July 31, 2012, we completed the final step of the transaction pursuant to which we acquired the remaining 25.40% of the outstanding Fibrek Inc. shares, following the approval of Fibrek’s shareholders on July 23, 2012, and the issuance of a final order by the Quebec Superior Court in Canada (or, the “Quebec Superior Court”) approving the arrangement on July 27, 2012. Certain former shareholders of Fibrek exercised rights of dissent in respect of the transaction, asking for a judicial determination of the fair value of their claim under the Canada Business Corporations Act. On September 26, 2019, the Quebec Superior Court rendered a decision fixing the fair value of the shares of the dissenting shareholders at C$1.99 per share, or C$31 million in aggregate, plus interest and an additional indemnity, for a total then estimated at C$44 million payable in cash. We had previously accrued C$14 million for the payment of the dissenting shareholders’ claims. Following the court decision, we accrued an additional C$30 million ($23 million). Of the total amount of C$44 million, C$19 million ($14 million) was payable immediately and paid on October 2, 2019. The remaining balance of C$27 million as of June 30, 2021 and C$26 million as of December 31, 2020 ($21 million and $20 million as of June 30, 2021 and December 31, 2020, respectively), which includes accrued interest, is recorded in “Accounts payable and other” as of June 30, 2021, and in “Other liabilities” as of December 31, 2020, in our Consolidated Balance Sheets. We are appealing the decision, therefore the payment of any additional consideration and its timing will depend on the outcome of the appeal. On November 13, 2019, a legal hypothec in the amount of C$30 million was registered on our Saint-Félicien (Quebec) immovable and movable property to secure the payment of any additional amounts following the outcome of the appeal. The hearing in this matter is expected to occur in the next 12 months.

Partial wind-ups of pension plans

On June 12, 2012, we filed a motion for directives with the Quebec Superior Court, the court with jurisdiction in the creditor protection proceedings under the Companies’ Creditors Arrangement Act (Canada) (or, the “CCAA Creditor Protection Proceedings”), seeking an order to prevent pension regulators in each of Quebec, New Brunswick, and Newfoundland and Labrador from declaring partial wind-ups of pension plans relating to employees of former operations in New Brunswick, and Newfoundland and Labrador, or a declaration that any claim for accelerated reimbursements of deficits arising from a partial wind-up is a barred claim under the CCAA Creditor Protection Proceedings. We contend, among other things, that any such declaration, if issued, would be inconsistent with the Quebec Superior Court’s sanction order confirming the CCAA debtors’ CCAA Plan of Reorganization and Compromise, as amended, and the terms of our emergence from the CCAA Creditor Protection Proceedings. A partial wind-up would likely shorten the period in which any deficit within those plans, which could reach up to C$150 million ($121 million), would have to be funded if we do not obtain the relief sought. The hearing in this matter has not yet been scheduled but could occur in the next twelve months.

Environmental matters

We are subject to a number of federal or national, state, provincial, and local environmental laws, regulations, and orders in various jurisdictions. We believe our operations are in material compliance with current applicable environmental laws and regulations. Environmental regulations promulgated and orders issued in the future could require substantial additional expenditures for compliance and could have a material impact on us, in particular, and the industry in general.

We have environmental liabilities of $13 million and $15 million recorded as of June 30, 2021 and December 31, 2020, respectively, primarily related to environmental remediation, assessment, monitoring and management related to closed or idled sites. The amount of these liabilities represents management’s estimate of the ultimate settlement based on an assessment of relevant factors and assumptions and could be affected by changes in facts or assumptions not currently known to management for which the outcome cannot be reasonably estimated at this time.

We also have asset retirement obligations of $27 million and $25 million recorded as of June 30, 2021 and December 31, 2020, respectively, primarily consisting of liabilities associated with landfills, sludge basins and the dismantling of retired assets.

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Notes to Unaudited Interim Consolidated Financial Statements

These liabilities are included in “Accounts payable and other” and “Other liabilities” in our Consolidated Balance Sheets.

Note 12. Share Capital

Treasury stock

On March 2, 2020, our board of directors authorized a share repurchase program of up to 15% of our common stock, for an aggregate consideration of up to $100 million. During the three and six months ended June 30, 2021, we repurchased 343,894 shares at an average price of $11.21 for a total of $3 million and 2,092,348 shares at an average price of $9.78 for a total of $20 million, respectively. We repurchased 253,898 shares at an average price of $2.09 for a total of $1 million during the three and six months ended June 30, 2020.

Dividends

We declared a special dividend of $1.00 per share ($79 million) on our common stock during the three and six months ended June 30, 2021, which was recorded in “Accounts payable and other” in our Consolidated Balance Sheet as of June 30, 2021. The dividend was paid to shareholders on July 7, 2021. We did not declare or pay any dividends on our common stock during the three and six months ended June 30, 2020.

Under some of our compensation plans, participants are credited additional units when a dividend is declared. The impact of the special dividend was as follows: for the three and six months ended June 30, 2021, $3 million was recognized as a compensation expense, and $2 million as an increase in deficit and in additional paid-in capital; and $3 million as an increase in liabilities as of June 30, 2021.

Note 13. Segment Information

We manage our business based on the products we manufacture. Accordingly, our reportable segments correspond to our principal product lines: market pulp, tissue, wood products, and paper.

None of the income or loss items following “Operating income (loss)” in our Consolidated Statements of Operations are allocated to our segments, since those items are reviewed separately by management. For the same reason, closure costs, impairment and other related charges, gains and losses on disposition of assets, as well as other discretionary charges or credits are not allocated to our segments. We allocate depreciation and amortization expense to our segments, although the related fixed assets and amortizable intangible assets are not allocated to segment assets. Additionally, all selling, general and administrative expenses are allocated to our segments, with the exception of certain discretionary charges and credits, which we present under “corporate and other.”

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Notes to Unaudited Interim Consolidated Financial Statements

Information about certain segment data for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Market Pulp (1)		Tissue		Wood Products (2)		Paper		Segment Total		Corporate and Other		Total
Sales
Second quarter
2021	$	199	$	35	$	664	$	242	$	1,140	$	—	$	1,140
2020	$	161	$	44	$	199	$	208	$	612	$	—	$	612
First six months
2021	$	375	$	77	$	1,094	$	467	$	2,013	$	—	$	2,013
2020	$	338	$	93	$	373	$	497	$	1,301	$	—	$	1,301
Depreciation and amortization
Second quarter
2021	$	6	$	4	$	10	$	16	$	36	$	4	$	40
2020	$	6	$	5	$	10	$	16	$	37	$	3	$	40
First six months
2021	$	12	$	9	$	21	$	31	$	73	$	8	$	81
2020	$	12	$	9	$	21	$	33	$	75	$	7	$	82
Operating income (loss)
Second quarter
2021	$	30	$	(7)	$	405	$	(7)	$	421	$	(15)	$	406
2020	$	10	$	(2)	$	15	$	(12)	$	11	$	(5)	$	6
First six months
2021	$	34	$	(9)	$	626	$	(31)	$	620	$	(37)	$	583
2020	$	7	$	—	$	20	$	(15)	$	12	$	(14)	$	(2)

(1)Inter-segment sales were $8 million and $7 million for the three months ended June 30, 2021 and 2020, and $15 million and $14 million for the six months ended June 30, 2021 and 2020, respectively. These inter-segment sales, which were transacted at either the lowest market price of the previous month or cost, were excluded from market pulp sales.

(2)Wood products sales to our joint ventures, which are transacted at arm’s length negotiated prices, were $20 million and $5 million for the three months ended June 30, 2021 and 2020, respectively, and $33 million and $10 million for the six months ended June 30, 2021 and 2020, respectively.

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ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis is intended to help the reader understand Resolute Forest Products, our results of operations, cash flows and financial condition. The discussion is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and the accompanying notes (or, the “Consolidated Financial Statements”) contained in Item 1, “Financial Statements,” of this Quarterly Report on Form 10-Q (or, “Form 10-Q”).

When we refer to “Resolute Forest Products,” “Resolute,” “we,” “our,” “us” or the “Company,” we mean Resolute Forest Products Inc. with its subsidiaries, either individually or collectively, unless otherwise indicated.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION AND USE OF THIRD-PARTY DATA

Statements in this Form 10-Q that are not reported financial results or other historical information of Resolute Forest Products are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. They include, for example, statements relating to the impact of the novel coronavirus (or, “COVID-19”) pandemic and resulting economic conditions on our business, results of operations and market price of our securities, and to our: efforts and initiatives to reduce costs, increase revenues, and improve profitability; business and operating outlook; future pension obligations; assessment of market conditions; growth strategies and prospects, and the growth potential of the Company and the industry in which we operate; liquidity; future cash flows, including as a result of the changes to our pension funding obligations; estimated capital expenditures; and strategies for achieving our goals generally. Forward-looking statements may be identified by the use of forward-looking terminology such as the words “should,” “would,” “could,” “will,” “may,” “expect,” “believe,” “see,” “anticipate,” “continue,” “attempt,” “project,” “progress,” “build,” “pursue,” “plan,” “grow,” “allow,” “look,” “enhance” and other terms with similar meaning indicating possible future events or potential impact on our business or Resolute Forest Products’ shareholders.

The reader is cautioned not to place undue reliance on these forward-looking statements, which are not guarantees of future performance. These statements are based on management’s current assumptions, beliefs, and expectations, all of which involve a number of business risks and uncertainties that could cause actual results to differ materially. The potential risks and uncertainties that could cause our actual future financial condition, results of operations, and performance to differ materially from those expressed or implied in this Form 10-Q include, but are not limited to, the impact of: the COVID-19 pandemic on our business and resulting economic conditions; developments in non-print media, including changes in consumer habits, and the effectiveness of our responses to these developments; intense competition in the forest products industry; any inability to offer products certified to globally recognized forestry management and chain of custody standards; any inability to successfully implement our strategies to increase our earnings power; the possible failure to successfully integrate acquired businesses with ours or to realize the anticipated benefits of acquisitions, such as our entry into wood manufacturing in the U.S., and tissue production and sales, or divestitures or other strategic transactions or projects, including loss of synergies following business divestitures; uncertainty or changes in political or economic conditions in the U.S., Canada or other countries in which we sell our products, including the effects of pandemics; global economic conditions; the highly cyclical nature of the forest products industry; any difficulties in obtaining timber or wood fiber at favorable prices, or at all; changes in the cost of purchased energy and other raw materials; physical, financial and regulatory risks associated with global, regional, and local weather conditions, and climate change; any disruption in operations or increased labor costs due to labor disputes or occupational health and safety issues; difficulties in our employee relations or in employee attraction or retention; disruptions to our supply chain, operations, or the delivery of our products, including due to public health epidemics; disruptions to our information technology systems including cybersecurity and privacy incidents; risks related to the operation and transition of legacy system applications; negative publicity, even if unjustified; currency fluctuations; any increase in the level of required contributions to our pension plans, including as a result of any increase in the amount by which they are underfunded; our ability to maintain adequate capital resources to provide for all of our substantial capital requirements; the terms of our outstanding indebtedness, which could restrict our current and future operations; changes relating to the London Interbank Offered Rate (or, the “LIBOR”), which could impact our borrowings under our credit facilities; losses that are not covered by insurance; any shutdown of machines or facilities, restructuring of operations or sale of assets resulting in any additional closure costs and long-lived asset or goodwill impairment or accelerated depreciation charges; any need to record additional valuation allowances against our recorded deferred income tax assets; our exports from one country to another country becoming or remaining subject to duties, cash deposit requirements, border taxes, quotas, or other trade remedies or restrictions; countervailing and anti-dumping duties on imports to the U.S. of the vast majority of our softwood lumber products produced at our Canadian sawmills; any failure to comply with laws or regulations generally; any additional environmental or health and safety liabilities; any violation of trade laws, export controls, or other laws relating to our international sales and operations; adverse outcomes of legal proceedings, claims and governmental inquiries, investigations, and other disputes in which we are involved; the actions of holders of a significant percentage of our common stock; and the potential risks and uncertainties set

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forth under Part I, Item 1A, “Risk Factors,” of our annual report on Form 10-K for the year ended December 31, 2020, filed with the U.S. Securities and Exchange Commission (or, the “SEC”) on March 1, 2021 (or, the “2020 Annual Report”), which have been heightened by the COVID-19 pandemic, including related governmental responses and economic impacts, market disruptions and resulting changes in consumer habits.

All forward-looking statements in this Form 10-Q are expressly qualified by the cautionary statements contained or referred to in this section and in our other filings with the SEC and the Canadian securities regulatory authorities. We disclaim any obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

Market and industry data

The information on industry and general economic conditions in this Form 10-Q was derived from third-party sources and trade publications we believe to be widely accepted and accurate. We have not independently verified the information and cannot assure you of its accuracy.

OVERVIEW

Resolute Forest Products is a global leader in the forest products industry with a diverse range of products, including market pulp, tissue, wood products, and paper, which are marketed in over 50 countries. The Company owns or operates some 40 facilities, as well as power generation assets, in the U.S. and Canada. We produce lumber in the U.S. and Canada, and we are the largest producer of wood products east of the Canadian Rockies, the largest producer of uncoated mechanical papers in North America, and a competitive pulp producer in North America. We are also a leading global producer of newsprint and an emerging tissue producer. Resolute has third-party certified 100% of its managed woodlands to internationally recognized sustainable forest management standards.

We report our activities in four business segments: market pulp, tissue, wood products, and paper. We believe an integrated approach across these segments maximizes value creation for our Company and stakeholders.

We are guided by our vision and values, focusing on safety, sustainability, profitability, accountability, and teamwork. We believe we can be distinguished by the following competitive strengths:

•Competitive cost structure combined with diversified and integrated asset base

–large-scale and cost-effective operations, including significant internal energy production from cogeneration and hydroelectric facilities, which support our value proposition;

–control over fiber transformation chain from standing timber to end-product for the majority of our offering;

–nearly 100% of our products sourced from high-quality virgin fiber;

–harvesting rights for the majority of fiber needs in Canada; and

–sophisticated logistics capabilities to meet demanding customer expectations.

•Solid balance sheet

–favorable pricing and flexibility under borrowing agreements together with our liquidity levels support our ability to weather challenging market cycles and to execute our transformation strategy;

–significant tax assets to defer cash income taxes and provide synergies to execute this strategy; and

–customers benefit from a financially stable and reliable business partner in a challenging industry.

•Seasoned management team

–deep industry expertise, with influential leaders in forestry, operations, environmental risk management and public policy;

–culture of accountability, encouraging transparency and straightforwardness; and

–core identity tied to renewable resources we harvest in a truly sustainable manner.

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Our Business

For information relating to our products, strategy and highlights, sustainable development and performance, and power generation assets, refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview – Our Business” in our 2020 Annual Report.

Second Quarter Overview

Impact of the COVID-19 pandemic

We have sustained operations across all of our business segments through the COVID-19 pandemic, but we had to take certain measures in the face of the dramatic reduction in economic activity, particularly for marketing-dependent products like newspapers, inserts, flyers and commercial paper. In March 2021, the Company announced the indefinite idling of its Amos and Baie-Comeau (Quebec) paper mills, which had been temporarily idled since spring 2020, as a result of market conditions and the impacts of the pandemic, reducing the run-rate newsprint capacity by 25% (equivalent to 43,000 metric tons per month).

Dividends

We declared a special dividend of $1.00 per share ($79 million) on our common stock in the current quarter, which was recorded in “Accounts payable and other” in our Consolidated Balance Sheet as of June 30, 2021. The dividend was paid to shareholders on July 7, 2021.

Amendment to Senior Secured Credit Facility

On April 19, 2021, we amended the Senior Secured Credit Facility agreement in order to repay the $180 million of pre-amended term loans, extend the maturity date of the revolving credit facility from 2025 to 2027, reduce the spread on the term loan facility by up to 10 basis points, and reinstate in full the $180 million Term Loan Facility. See below under “Liquidity and Capital Resources – Capital Resources” for more information.

Three months ended June 30, 2021 vs. June 30, 2020

Our operating income was $406 million in the quarter, compared to an operating income of $6 million in the second quarter of 2020. Excluding special items, our operating income was $405 million, compared to an operating loss of $3 million in the year-ago period. Special items are described below.

Our net income in the quarter was $268 million, or $3.34 per diluted share, compared to a net income of $6 million, or $0.07 per diluted share, in the year-ago period. Our net income in the quarter, excluding special items, was $300 million, or $3.74 per diluted share, compared to a net loss of $22 million, or $0.25 per share, in the year-ago period.

Three Months Ended June 30, 2021	Operating Income		Net Income		EPS
(Unaudited, in millions, except per share amounts)
GAAP, as reported	$	406	$	268	$	3.34
Adjustments for special items:
Closure costs, impairment and other related charges		(1)		(1)		(0.01)
Non-operating pension and other postretirement benefit credits		—		(3)		(0.04)
Other expense, net		—		49		0.61
Income tax effect of special items		—		(13)		(0.16)
Adjusted for special items (1)	$	405	$	300	$	3.74

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Three Months Ended June 30, 2020	Operating Income (Loss)		Net Income (Loss)		EPS
(Unaudited, in millions, except per share amounts)
GAAP, as reported	$	6	$	6	$	0.07
Adjustments for special items:
Net gain on disposition of assets		(9)		(9)		(0.10)
Non-operating pension and other postretirement benefit credits		—		(4)		(0.05)
Other income, net		—		(10)		(0.11)
Income tax effect of special items		—		(5)		(0.06)
Adjusted for special items (1)	$	(3)	$	(22)	$	(0.25)

(1)Operating income (loss), net income (loss) and net income (loss) per share (or, “EPS”), in each case as adjusted for special items, are not financial measures recognized under U.S. generally accepted accounting principles (or, “GAAP”). We calculate operating income (loss), as adjusted for special items, as operating income (loss) from our Consolidated Statements of Operations, adjusted for items such as closure costs, impairment, and other related charges, and gains and losses on disposition of assets that are excluded from our segment’s performance from GAAP operating income (loss). We calculate net income (loss), as adjusted for special items, as net income (loss) from our Consolidated Statements of Operations, adjusted for the same special items applied to operating income (loss), in addition to non-operating pension and other postretirement benefit (or, “OPEB”) costs and credits, other income and expense, net, and the income tax effect of the special items. EPS, as adjusted for special items, is calculated as net income (loss), as adjusted for special items, per diluted share. We believe that using these non-GAAP measures is useful because they are consistent with the indicators management uses internally to measure the Company’s performance, and it allows the reader to compare our operations and financial performance from period to period. Operating income (loss), net income (loss) and EPS, in each case as adjusted for special items, 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.

Six months ended June 30, 2021 vs. June 30, 2020

Our operating income was $583 million in the first half of the year, compared to operating loss of $2 million in the year-ago period. Excluding special items, our operating income was $585 million, compared to operating loss of $13 million in the year-ago period. Special items are described below.

Our net income in the first half of the year was $355 million, or $4.39 per diluted share, compared to net income of $5 million, or $0.06 per diluted share, in the year-ago period. Our net income in the period, excluding special items, was $419 million, or $5.18 per diluted share, compared to net loss of $51 million, or $0.57 per share, in the year-ago period.

Six Months Ended June 30, 2021	Operating Income		Net Income		EPS
(Unaudited, in millions, except per share amounts)
GAAP, as reported	$	583	$	355	$	4.39
Adjustments for special items:
Closure costs, impairment and other related charges		2		2		0.02
Non-operating pension and other postretirement benefit credits		—		(5)		(0.06)
Other expense, net		—		94		1.16
Income tax effect of special items		—		(27)		(0.33)
Adjusted for special items (1)	$	585	$	419	$	5.18

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Six Months Ended June 30, 2020	Operating Loss		Net Income (Loss)		EPS
(Unaudited, in millions, except per share amounts)
GAAP, as reported	$	(2)	$	5	$	0.06
Adjustments for special items:
Closure costs, impairment and other related charges		(2)		(2)		(0.02)
Net gain on disposition of assets		(9)		(9)		(0.10)
Non-operating pension and other postretirement benefit credits		—		(19)		(0.22)
Other income, net		—		(38)		(0.43)
Income tax effect of special items		—		12		0.14
Adjusted for special items (1)	$	(13)	$	(51)	$	(0.57)

(1)    Operating income (loss), net income (loss) and EPS, in each case as adjusted for special items, are non-GAAP financial measures. For more information on the calculation and reasons we include these measures, see note 1 under “Overview – Second Quarter Overview” above.

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RESULTS OF OPERATIONS

Consolidated Results

Selected financial information

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except per share amounts)	2021		2020		2021		2020
Sales	$	1,140	$	612	$	2,013	$	1,301
Operating income (loss) per segment:
Market pulp	$	30	$	10	$	34	$	7
Tissue		(7)		(2)		(9)		—
Wood products		405		15		626		20
Paper		(7)		(12)		(31)		(15)
Segment total		421		11		620		12
Corporate and other		(15)		(5)		(37)		(14)
Operating income (loss)	$	406	$	6	$	583	$	(2)
Net income attributable to Resolute Forest Products Inc.	$	268	$	6	$	355	$	5
Net income per common share attributable to Resolute Forest Products Inc. common shareholders:
Basic	$	3.37	$	0.07	$	4.42	$	0.06
Diluted	$	3.34	$	0.07	$	4.39	$	0.06
Adjusted EBITDA (1)	$	445	$	37	$	666	$	69

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Cash and cash equivalents	$	177	$	113
Total assets	$	3,828	$	3,730

(1)Earnings before interest expense, income taxes, and depreciation and amortization (or, “EBITDA”) and adjusted EBITDA are not financial measures recognized under GAAP. EBITDA is calculated as net income (loss) including noncontrolling interest 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 closure costs, impairment and other related charges, gains and losses on disposition of assets, non-operating pension and OPEB costs and credits, and other income and expense, net. 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 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.

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	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net income including noncontrolling interest	$	268	$	6	$	356	$	5
Interest expense		5		9		11		18
Income tax provision		87		5		127		32
Depreciation and amortization		40		40		81		82
EBITDA	$	400	$	60	$	575	$	137
Closure costs, impairment and other related charges		(1)		—		2		(2)
Net gain on disposition of assets		—		(9)		—		(9)
Non-operating pension and other postretirement benefit credits		(3)		(4)		(5)		(19)
Other expense (income), net		49		(10)		94		(38)
Adjusted EBITDA	$	445	$	37	$	666	$	69

Three months ended June 30, 2021 vs. June 30, 2020

Operating income variance analysis

Sales

Sales increased by $528 million compared to the year-ago period, to $1,140 million. Pricing had a favorable impact of $500 million, mainly as a result of an increase in the average transaction price for wood products, market pulp and paper, up by 202%, 27%, and 7% respectively. Higher volume increased sales by $25 million, mainly reflecting higher shipments of wood products and paper, partly offset by lower shipments of market pulp and tissue.

Cost of sales, excluding depreciation, amortization and distribution costs

Cost of sales, excluding depreciation, amortization and distribution costs (or, “COS”) increased by $102 million compared to the year-ago period. After removing the effects of higher volume and the stronger Canadian dollar, COS increased by $53 million, largely reflecting:

•higher fiber costs ($27 million), mainly reflecting higher log costs for the wood products segment, partly offset by lower chips costs in the market pulp and paper segment;

•unfavorable maintenance costs ($14 million) as a result of the timing of scheduled outages and the scope of maintenance work; and

•higher energy prices ($8 million).

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Distribution costs

After removing the effect of higher volume and the stronger Canadian dollar, distribution costs increased by $4 million, mainly due to higher freight rates.

Selling, general and administrative expenses

SG&A expenses increased by $4 million in the quarter compared to the same period last year, mainly due to higher incentive plan expense, which is based on company performance, and higher stock-based compensation expense.

Net gain on disposition of assets

See the corresponding variance analysis under “Corporate and Other” below.

Net income variance analysis

Non-operating pension and other postretirement benefit credits

We recorded non-operating pension and OPEB credits of $3 million in the quarter, compared to $4 million in the year-ago period. The difference mainly reflects: higher amortization of actuarial losses in the current period ($4 million); partly offset by lower interest cost ($2 million) in the current period and higher amortization of prior service credits ($1 million).

Other (expense) income, net

We recorded other expense, net of $49 million in the quarter, compared to other income, net of $10 million in the year-ago period. The difference mainly reflects a loss on commodity contracts of $49 million principally related to lumber futures contracts and a foreign exchange loss of $6 million in the current period, compared to a favorable insurance claim settlement of $15 million related to our acquisition of Atlas Paper Holdings Inc. (or “Atlas”) in 2015 and a foreign exchange loss of $9 million in the year-ago period. There were no lumber future contracts outstanding as of June 30, 2021.

Interest expense

Interest expense was $4 million lower in the quarter compared to the year-ago period, as a result of the refinancing of the 2023 Notes at a lower interest rate and lower debt level.

Income taxes

We recorded an income tax provision of $87 million in the quarter on income before income taxes of $355 million, compared to an expected income tax provision of $74 million based on the U.S. federal statutory income tax rate of 21%. The difference mainly reflects: U.S. tax on non-U.S. earnings ($65 million); and foreign tax rate differences ($19 million); partly offset by a decrease in our valuation allowance related to our U.S. operations ($70 million) where we recognize a full valuation allowance against our net deferred income tax assets.

The $70 million decrease in our valuation allowance for the three months ended June 30, 2021, is to offset mainly the tax implications relating to the global intangible low-taxed income (or, “GILTI”) inclusion, which is based on the U.S. system of taxation for non-U.S. earnings, whereby foreign earnings less a qualified deduction for foreign assets are included in U.S. taxable income.

In the second quarter of 2020, we recorded an income tax provision of $5 million, on income before income taxes of $11 million, compared to an expected income tax provision of $3 million, based on the U.S. federal statutory income tax rate of 21%. The difference mainly reflects: an increase to our valuation allowance related to our U.S. operations ($7 million) where we recognize a valuation allowance against virtually all of our net deferred income tax assets; partially offset by other items ($5 million), mainly related to the settlement of an insurance claim in connection with our acquisition of Atlas.

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Six months ended June 30, 2021 vs. June 30, 2020

Operating income (loss) variance analysis

Sales

Sales increased by $712 million compared to the year-ago period, to $2,013 million. Pricing had a favorable impact of $753 million, mainly as a result of an increase in the average transaction price for wood products, market pulp, and paper up by 165%, 19% and 3% respectively. Lower volume reduced sales by $45 million, mainly reflecting lower shipments in paper ($45 million), market pulp ($22 million) and tissue ($17 million), partly offset by higher shipments of wood products ($39 million).

Cost of sales, excluding depreciation, amortization and distribution costs

COS increased by $100 million in the period. After removing the effects of lower volume and the stronger Canadian dollar, COS increased by $89 million, largely reflecting:

•higher fiber costs ($40 million), mainly reflecting higher log costs for the wood products segment, partly offset by lower chips costs in the market pulp and paper segment;

•unfavorable maintenance costs ($19 million) as a result of the timing of scheduled outages and the scope of maintenance work;

•higher energy prices ($12 million);

•higher expenses related to a process improvement project ($10 million); and

•higher labor expense ($8 million), mainly due to higher compensation expense.

Selling, general and administrative expenses

SG&A expenses increased by $16 million in the first half of 2021, compared to the same period last year, mainly due to higher incentive plan expense, which is based on company performance, and higher stock-based compensation expense, partly offset by lower corporate expenses.

Closure costs, impairment and other related charges

In the first half of 2021, we recorded closure costs, impairment and other related charges of $2 million, related to the

indefinite idling of our Amos and Baie-Comeau paper mills. This compares to the reversal of $2 million of closure costs, impairment and other related charges in the year-ago period, related to the indefinite idling of our paper mill at Augusta (Georgia).

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Net gain on disposition of assets

See the corresponding variance analysis under “Corporate and Other” below.

Net income variance analysis

Non-operating pension and other postretirement benefit credits

We recorded non-operating pension and OPEB credits of $5 million in the first half of 2021, compared to $19 million in the year-ago period. The difference mainly reflects: an OPEB curtailment credit related to the indefinite idling of our Augusta mill in the prior period ($14 million); higher amortization of actuarial losses ($9 million); and lower expected return on plan assets ($2 million); partly offset by lower interest cost ($7 million) and a pension special termination benefit cost related to the indefinite idling of our Augusta mill in the prior period ($3 million).

Interest expense

Interest expense was $7 million lower in the first half compared to the year-ago period, as a result of the refinancing of the 2023 Notes at a lower interest rate and lower debt level.

Other income (expense), net

We recorded other expense, net of $94 million in the first half of 2021, compared to other income, net of $38 million in the year-ago period. The difference mainly reflects a loss on commodity contracts of $86 million principally related to lumber futures contracts and a foreign exchange loss of $11 million in the current period, compared to a favorable insurance claim settlement of $15 million related to our acquisition of Atlas in 2015, a gain on commodity contracts of $4 million and a foreign exchange gain of $14 million in the year-ago period. There were no lumber future contracts outstanding as of June 30, 2021.

Income taxes

We recorded an income tax provision of $127 million in the period, on income before income taxes of $483 million, compared to an expected income tax provision of $101 million based on the U.S. federal statutory income tax rate of 21%. The difference mainly reflects: U.S. tax on non-U.S. earnings ($83 million); and foreign tax rate differences ($27 million); partly offset by a net decrease in our valuation allowance related to our U.S. operations ($78 million) where we recognize a full valuation allowance against our net deferred income tax assets, and foreign exchange items ($3 million).

The $78 million net decrease in our valuation allowance for the six months ended June 30, 2021, is to offset mainly the tax implications relating to the GILTI inclusion, which is based on the U.S. system of taxation for non-U.S. earnings, whereby foreign earnings less a qualified deduction for foreign assets are included in U.S. taxable income.

In the first half of 2020, we recorded an income tax provision of $32 million, on income before income taxes of $37 million, compared to an expected income tax provision of $8 million based on the U.S. federal statutory income tax rate of 21%. The difference mainly reflects: an increase to our valuation allowance related to our U.S. operations ($16 million) where we recognize a valuation allowance against virtually all of our net deferred income tax assets; foreign exchange items ($10 million); and state and foreign tax rate differences ($3 million); partially offset by other items ($5 million), mainly related to the settlement of an insurance claim in connection with our acquisition of Atlas.

Segment Earnings

We manage our business based on the products we manufacture. Our reportable segments correspond to our principal product lines: market pulp, tissue, wood products, and paper.

We do not allocate any of the income or loss items following “operating income (loss)” in our Consolidated Statements of Operations to our segments because those items are reviewed separately by management. Similarly, we do not allocate to the segments: closure costs, impairment and other related charges; gains and losses on disposition of assets; as well as other discretionary charges or credits.

We allocate depreciation and amortization expense to our segments, although the related fixed assets and amortizable intangible assets are not allocated to segment assets. Additionally, all SG&A expenses are allocated to our segments, with the exception of certain discretionary charges and credits, which we present under “corporate and other.”

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MARKET PULP

Highlights

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except where otherwise stated)	2021		2020		2021		2020
Sales	$	199	$	161	$	375	$	338
Operating income (1)	$	30	$	10	$	34	$	7
EBITDA (2)	$	36	$	16	$	46	$	19
(In thousands of metric tons)
Shipments		253		258		525		561
Downtime		23		33		48		33

	June 30,
(Unaudited, in thousands of metric tons)	2021		2020
Finished goods inventory		63		87

(1)Net income including noncontrolling interest is equal to operating income in this segment.

(2)EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “Results of Operations – Consolidated Results – Selected financial information” above.

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net income including noncontrolling interest	$	30	$	10	$	34	$	7
Depreciation and amortization		6		6		12		12
EBITDA	$	36	$	16	$	46	$	19

Industry trends

World demand for chemical pulp decreased by 1.8% in the first five months of 2021 compared to the year-ago period, with Western Europe decreasing by 0.1%, while China increased by 2.4% and North America was stable. World capacity decreased by 1.1% compared to the year-ago period.

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World demand for softwood pulp fell by 4.7% in the first five months of 2021, reflecting an increase of 1.0% in China and a decrease of 2.3% and 5.2% in Western Europe and North America, respectively. The operating rate was 89%.

In the same period, world demand for hardwood pulp fell by 1.3%, although shipments to Western Europe, North America and China were up by 0.9%, 4.8% and 1.3%, respectively. The operating rate was 93%.

Three months ended June 30, 2021 vs. June 30, 2020

Operating income variance analysis

Sales

Sales were $38 million higher, or 24%, in the quarter to $199 million mostly due to an increase in pricing of $42 million, reflecting an increase in the average transaction price of $168 per metric ton, or 27%, due to a price increase across all pulp grades.

Cost of sales, excluding depreciation, amortization and distribution costs

COS increased by $14 million compared to the year-ago period. After removing the effects of lower volume and the stronger Canadian dollar, COS increased by $9 million, largely reflecting higher energy prices ($6 million) and unfavorable maintenance costs ($3 million) as a result of the timing of scheduled outages and the scope of maintenance work; partly offset by lower fiber costs ($4 million).

31

Six months ended June 30, 2021 vs. June 30, 2020

Operating income variance analysis

Sales

Sales were $37 million higher, or 11%, to $375 million in the first half of the year. Pricing had a favorable impact of $59 million, reflecting an increase in the average transaction price of $113 per metric ton, or 19%, due to a price increase across all pulp grades. Lower volume reduced sales by $22 million, mainly reflecting lower shipments due to a planned outage and logistic constraints.

Cost of sales, excluding depreciation, amortization and distribution costs

After adjusting for the effects of lower volume and the stronger Canadian dollar, manufacturing costs increased by $10 million, reflecting:

•higher energy prices ($8 million);

•unfavorable maintenance costs ($4 million) as a result of the timing of scheduled outages and the scope of maintenance work; and

•higher expenses related to a process improvement project ($4 million);

partly offset by lower chips costs ($7 million).

32

TISSUE

Highlights

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except where otherwise stated)	2021		2020		2021		2020
Sales	$	35	$	44	$	77	$	93
Operating loss (1)	$	(7)	$	(2)	$	(9)	$	—
EBITDA (2)	$	(3)	$	3	$	—	$	9
(In thousands of short tons)
Shipments (3)		19		24		42		52
Downtime		7		2		7		2

	June 30,
(Unaudited, in thousands of short tons)	2021		2020
Finished goods inventory (3)		8		5

(1)Net loss including noncontrolling interest is equal to operating loss in this segment.

(2)EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “Results of Operations – Consolidated Results – Selected financial information” above.

(3)Tissue converted products, which are measured in cases, are converted to short tons.

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net loss including noncontrolling interest	$	(7)	$	(2)	$	(9)	$	—
Depreciation and amortization		4		5		9		9
EBITDA	$	(3)	$	3	$	—	$	9

Industry trends

Total U.S. tissue consumption fell by 6.9% in the first half of 2021, compared to the year-ago period. Converted product shipments decreased by 8.7%, where at-home shipments decreased by 11.9%, and away-from-home shipments decreased by 0.6%.

33

U.S. parent roll production fell by 6.0% in the first half of 2021, and the average industry production-to-capacity ratio decreased to 91%, down from 97% in the year-ago period.

Three months ended June 30, 2021 vs. June 30, 2020

Operating loss variance analysis

Sales

Sales were $9 million lower, or 20%, to $35 million in the quarter, mainly due to a decrease in shipments by 5,000 short tons related to the prior year quarter strong volume in at-home products related to the start of the pandemic.

Cost of sales, excluding depreciation, amortization and distribution costs

After removing the effect of lower volume, our manufacturing costs increased by $3 million compared to the year-ago period, mainly due to unfavorable maintenance costs as a result of the timing of scheduled outages and the scope of maintenance work, and costs to ramp-up the Hagerstown (Maryland) converting facility acquired in the fourth quarter of 2020.

34

Six months ended June 30, 2021 vs. June 30, 2020

Operating loss variance analysis

Sales

Sales were $16 million lower, or 17%, to $77 million in the first half of the year, mainly due to a decrease in shipments of 10,000 short tons, principally in away-from-home products due to the ongoing pandemic, and an unfavorable product mix.

Cost of sales, excluding depreciation, amortization and distribution costs

After removing the effect of lower volume, our manufacturing costs increased by $6 million compared to the year-ago period, mainly due to higher expenses related to a process improvement project, unfavorable maintenance costs as a result of the timing of scheduled outages and the scope of maintenance work, and costs to ramp-up the Hagerstown (Maryland) converting facility acquired in the fourth quarter of 2020.

35

WOOD PRODUCTS

Highlights

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except where otherwise stated)	2021		2020		2021		2020
Sales	$	664	$	199	$	1,094	$	373
Operating income (1)	$	405	$	15	$	626	$	20
EBITDA (2)	$	415	$	25	$	647	$	41
(In millions board feet)
Shipments (3)		575		521		1,067		964
Downtime		35		73		65		168

	June 30,
(Unaudited, in millions board feet)	2021		2020
Finished goods inventory (3)		124		119

(1)Net income including noncontrolling interest is equal to operating income in this segment.

(2)EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “Results of Operations – Consolidated Results – Selected financial information” above.

(3)Includes wood pellets measured by mass, converted to board feet using a density-based conversion ratio.

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net income including noncontrolling interest	$	405	$	15	$	626	$	20
Depreciation and amortization		10		10		21		21
EBITDA	$	415	$	25	$	647	$	41

Industry trends

U.S. housing starts were 1.6 million on a seasonally adjusted basis in the first six months of 2021, up 23.2% from the same period last year, which reflects a 28.8% increase in single-family starts and an increase of 11.0% in multi-family starts.

36

2x4 – Random Length (or “RL”) #1-2 Kiln Dried Great Lakes (or “KD GL”) price rose by 170.1% in the first six months of 2021 compared to the year ago period, and the 2x4x8 Stud KD GL price rose by 167.5%. The 2x4 – RL #2 KD Southern Pine (Eastside) price increased by 174.9%, and the 2x4 – RL #2 KD Southern Pine (Westside) price was up by 186.7%.

Three months ended June 30, 2021 vs. June 30, 2020

Operating income variance analysis

Sales

Sales were $465 million higher, or 234%, to $664 million in the quarter, due to the stronger market conditions. Pricing contributed to a $445 million increase in sales, reflecting the increase of the average transaction price by $773 per thousand board feet, or 202%, and volume increased sales by $20 million due to an increase in shipments of 54 million board feet, or 10%.

Cost of sales, excluding depreciation, amortization and distribution costs

After removing the COS related to the higher volume and the stronger Canadian dollar, manufacturing costs increased by $43 million, mainly due to higher fiber costs ($35 million) primarily reflecting higher log costs, and unfavorable maintenance costs ($6 million) as a result of the scope of maintenance work.

37

Six months ended June 30, 2021 vs. June 30, 2020

Operating income variance analysis

Sales

Sales were $721 million higher, or 193%, to $1,094 million in the first half of the year, due to the stronger market condition. Pricing contributed to a $682 million increase in sales, reflecting a rise in the average transaction price of $639 per thousand board feet, or 165%, and volume increased sales by $39 million due to an increase in shipments of 103 million board feet, or 11%.

Cost of sales, excluding depreciation, amortization and distribution costs

After adjusting for the effect of higher volume and the stronger Canadian dollar, manufacturing costs increased by $66 million, reflecting:

•higher fiber costs ($54 million), primarily reflecting higher log costs;

•unfavorable maintenance costs ($7 million) as a result of the scope of maintenance work; and

•higher labor expense ($3 million), mainly due to higher compensation expense.

38

PAPER

Highlights

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except where otherwise stated)	2021		2020		2021		2020
Sales	$	242	$	208	$	467	$	497
Operating loss (1)	$	(7)	$	(12)	$	(31)	$	(15)
EBITDA (2)	$	9	$	4	$	—	$	18
(In thousands of metric tons)
Shipments		382		350		760		832
Downtime		35		178		193		200

	June 30,
(Unaudited, in thousands of metric tons)	2021		2020
Finished goods inventory		72		130

(1)Net loss including noncontrolling interest is equal to operating loss in this segment.

(2)EBITDA, a non-GAAP financial measure, is reconciled below. For more information on the calculation and reasons we include this measure, see note 1 under “Results of Operations – Consolidated Results – Selected financial information” above.

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net loss including noncontrolling interest	$	(7)	$	(12)	$	(31)	$	(15)
Depreciation and amortization		16		16		31		33
EBITDA	$	9	$	4	$	—	$	18

Industry trends

North American newsprint demand fell by 14.3% in the first five months of the year compared to the same period last year. Demand from newspaper publishers fell by 22.8%, while demand from commercial printers declined by 0.1%. The North American shipment-to-capacity ratio was 91%, compared to 83% in the year-ago-period.

39

Global demand for newsprint fell by 12.3% in the first five months of 2021, with North America down by 14.3%, Western Europe down by 9.2%, and Asia down by 13.3%. Accordingly, the global operating rate increased to 84%, up from 74% in the year-ago period.

North American demand for uncoated mechanical papers rose by 0.2% in the first half of 2021, compared to the year-ago period, reflecting a 3.8% drop in supercalendered grades, and a 3.4% increase in standard grades. Accordingly, the shipment-to-capacity ratio for all uncoated mechanical papers increased to 87%, compared to 72% in the year-ago period.

40

Three months ended June 30, 2021 vs. June 30, 2020

Operating loss variance analysis

Sales

Sales increased by $34 million, or 16%, to $242 million in the quarter. Higher volume increased sales by $17 million, mainly due to an increase in shipments of 32,000 metric tons, or 9%, mainly reflecting a recovery from the lower demand levels since the onset of the pandemic in the prior year quarter. Pricing contributed to a $14 million increase in sales, reflecting a rise in the average transaction price of $44 per metric ton, or 7%.

Cost of sales, excluding depreciation, amortization and distribution costs

After adjusting for the effects of higher volume and the stronger Canadian dollar, manufacturing costs decreased by $2 million, reflecting lower chips costs ($5 million); partly offset by an unfavorable maintenance costs ($4 million) as a result of the timing of scheduled outages and the scope of maintenance work.

41

Six months ended June 30, 2021 vs. June 30, 2020

Operating loss variance analysis

Sales

Sales decreased by $30 million, or 6%, to $467 million in the first half of the year. Lower volume decreased sales by $45 million, due to a decrease in shipments of 72,000 metric tons, or 9%, mainly reflecting lower demand levels since the onset of the pandemic and our resulting capacity adjustments. Pricing contributed to a $11 million increase in sales, reflecting a rise in the average transaction price of $19 per metric ton, or 3%.

Cost of sales, excluding depreciation, amortization and distribution costs

Manufacturing costs increased by $9 million after adjusting for the effects of lower volume and the stronger Canadian dollar, reflecting:

•unfavorable maintenance costs ($7 million) as a result of the timing of scheduled outages and the scope of maintenance work;

•higher energy prices ($4 million);

•higher expenses related to a process improvement project ($4 million);

•higher labor expense ($3 million), mainly due to higher compensation expense;

partly offset by lower chips costs ($8 million).

42

Corporate and Other

Highlights

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Cost of sales, excluding depreciation, amortization and distribution costs	$	(2)	$	(2)	$	(2)	$	(4)
Depreciation and amortization		(4)		(3)		(8)		(7)
Selling, general and administrative expenses		(10)		(9)		(25)		(14)
Closure costs, impairment and other related charges		1		—		(2)		2
Net gain on disposition of assets		—		9		—		9
Operating loss		(15)		(5)		(37)		(14)
Interest expense		(5)		(9)		(11)		(18)
Non-operating pension and other postretirement benefit credits		3		4		5		19
Other (expense) income, net		(49)		10		(94)		38
Income tax provision		(87)		(5)		(127)		(32)
Net loss including noncontrolling interest	$	(153)	$	(5)	$	(264)	$	(7)

The table below shows the reconciliation of net loss including noncontrolling interest to EBITDA and adjusted EBITDA, which are non-GAAP financial measures. For more information on the calculation and reasons we include these measures, see note 1 under “Results of Operations – Consolidated Results – Selected financial information” above.

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Net loss including noncontrolling interest	$	(153)	$	(5)	$	(264)	$	(7)
Interest expense		5		9		11		18
Income tax provision		87		5		127		32
Depreciation and amortization		4		3		8		7
EBITDA		(57)		12		(118)		50
Closure costs, impairment and other related charges		(1)		—		2		(2)
Net gain on disposition of assets		—		(9)		—		(9)
Non-operating pension and other postretirement benefit credits		(3)		(4)		(5)		(19)
Other expense (income), net		49		(10)		94		(38)
Adjusted EBITDA	$	(12)	$	(11)	$	(27)	$	(18)

Three and six months ended June 30, 2021 vs. June 30, 2020

Net gain on disposition of assets

We recorded a net gain of $9 million on the disposition of the Augusta mill in the year-ago period.

43

LIQUIDITY AND CAPITAL RESOURCES

Capital Resources

We rely on cash and cash equivalents, cash flows provided by operations, and our credit facilities to: fund our operations; make pension contributions; and to finance our working capital, capital expenditures, duty cash deposits and opportunities for our growth and transformation strategy. In addition, from time to time we may use available cash to reduce debt and to return capital to shareholders, including through share repurchases or special dividends. As of June 30, 2021, we had cash and cash equivalents of $177 million and availability of $873 million under our credit facilities.

Based on our current projections, we expect to have sufficient financial resources available to finance our business plan, make pension contributions, meet working capital and duty cash deposit requirements, and maintain an appropriate level of capital spending.

Based on market conditions, we may seek to repay or refinance our outstanding indebtedness as we continue to focus on reducing costs and enhancing our flexibility.

Senior Secured Credit Facility

On April 19, 2021, we entered into a first amendment to the amended and restated senior secured credit facility (or, the “Senior Secured Credit Facility”) entered into on October 28, 2019. The amount available remains unchanged for up to $360 million and is comprised of a term loan facility of up to $180 million with a delayed draw period of up to three years and the choice of maturities of six to ten years from the date of drawing (or, the “Term Loan Facility”); and a six-year revolving credit facility of up to $180 million (or, the “Revolving Credit Facility”). On the effective date of the amendment, we repaid our $180 million of term loans under the amended and restated senior secured credit facility with a combination of proceeds of borrowings under the Revolving Credit Facility and cash on hand. Interest rates under the Senior Secured Credit Facility are based, at the Company’s election, on either a floating rate based on the LIBOR, or a base rate, in each case plus a spread over the index. In addition, loans under the Term Loan Facility can bear interest at a fixed rate plus a spread. For more information, see Note 8, “Long-Term Debt,” to our Consolidated Financial Statements.

Flow of Funds

Summary of cash flows

A summary of cash flows for the six months ended June 30, 2021 and 2020, was as follows:

	Six Months Ended June 30,
(Unaudited, in millions)	2021		2020
Net cash provided by operating activities	$	475	$	76
Net cash used in investing activities		(133)		(227)
Net cash (used in) provided by financing activities		(282)		176
Effect of exchange rate changes on cash and cash equivalents, and restricted cash		—		(1)
Net increase in cash and cash equivalents, and restricted cash	$	60	$	24

Six months ended June 30, 2021 vs. June 30, 2020

Net cash provided by operating activities

We generated $475 million of cash from operating activities in the first half of 2021, compared to $76 million in the year-ago period. The increase is primarily driven by higher profitability partly offset by an unfavorable working capital variance in the current period.

Net cash used in investing activities

We used $133 million of cash in investing activities in the current period, compared to $227 million in the year-ago period. The difference mostly reflects the acquisition of the U.S. Sawmill Business, net of cash acquired, in the year-ago period ($172 million); partly offset by higher countervailing and anti-dumping duty cash deposits in the current period ($57 million).

44

Net cash (used in) provided by financing activities

Net cash used in financing activities was $282 million in the first half of 2021, compared to cash provided by financing activities of $176 million in the year-ago period. The difference mostly reflects the repayment of the 2023 Notes of $375 million partly offset by the issuance of the 2026 Notes of $300 million, as well as the repayment of $180 million in term loans in the current period; compared to drawing of $180 million in term loans in the year-ago period. In the current period, we also repurchased $20 million of shares. The borrowings under the Revolving Credit Facility used to repay the $180 million term loan were also repaid during the quarter.

2021 outlook

To support the company’s continued growth, we have increased our expected capital expenditures from $95 million to $125 million, which includes a portion of the $22 million to modernize equipment at the Senneterre (Quebec) sawmill; $13 million to increase capacity at the Thunder Bay / Fort William First Nation (Ontario) sawmill; and $15 million to support fiber optimization and overall efficiency at the Glenwood (Arkansas) and Cross City (Florida) sawmills. The additional $50 million in wood products investments over a two year period will serve to generate additional value from our wood products segment across market cycles. We anticipate completing all the projects by the end of 2022.

Employee Benefit Plans

The American Rescue Plan Act of 2021 includes provisions that allow for interest rate smoothing of pension funding deficits to minimize the impact of lower interest rates on liabilities. It also extends the amortization period for funding shortfalls from seven years to 15 years under the current rules. We estimate that the impact of the Act on our previously disclosed estimated contributions for 2021 will be a reduction of $13 million.

Share Repurchase Program

On March 2, 2020, our board of directors authorized a share repurchase program of up to 15% of our common stock, for an aggregate consideration of up to $100 million. During the three and six months ended June 30, 2021, we repurchased 343,894 shares at an average price of $11.21 for a total of $3 million and 2,092,348 shares at an average price of $9.78 for a total of $20 million, respectively. Since the beginning of this share repurchase program, we have repurchased 9 million shares for a total cost of $50 million, representing 10% of our common stock. We repurchased 253,898 shares at an average price of $2.09 for a total of $1 million during the three and six months ended June 30, 2020.

Dividends

On June 10, 2021, we declared a special dividend of $1.00 per share ($79 million) on our common stock, paid on July 7, 2021 for holders of record at the close of business on June 28, 2021.

45

RESOLUTE FOREST PRODUCTS INC.

ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information relating to quantitative and qualitative disclosures about market risk is disclosed in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” in our 2020 Annual Report. We are supplementing our exposure to market risk as previously disclosed in our 2020 Annual Report with the additional information on market risk set forth below. This supplemental market risk information should be read in conjunction with the other market risks described in our 2020 Annual Report.

Prices, sales volume and margins for our products have historically been cyclical and subject to changes as a result of economic and market shifts, fluctuations in capacity, and movements in foreign currency exchange rates. In order to mitigate these risks and to protect the Company’s earnings and cash flows from adverse fluctuations of market risks, from time to time, we enter into derivative financial transactions, in compliance with our financial risk management policy, which forbids speculative purposes.

For more information on loss related to lumber futures contracts recorded during the current quarter, please see Note 2, “Other (Expense) Income, Net,” to our Consolidated Financial Statements.

ITEM 4.    CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures:

We have evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a–15(e) and 15d–15(e) of the Securities Exchange Act of 1934, as of June 30, 2021. Based on that evaluation, the President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of such date in recording, processing, summarizing and timely reporting information required to be disclosed in our reports to the SEC.

(b) Changes in Internal Control over Financial Reporting:

In connection with the evaluation of internal control over financial reporting, there were no changes during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

46

RESOLUTE FOREST PRODUCTS INC.

PART II.    OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

In addition to the legal proceedings presented under Part I, Item 3, “Legal Proceedings,” in our 2020 Annual Report, see the description of our material pending legal proceedings in Note 11, “Commitments and Contingencies – Legal matters,” to our Consolidated Financial Statements, which is incorporated in this “Item 1 – Legal Proceedings” by reference.

ITEM 1A.    RISK FACTORS

In addition to the other information set forth in this Form 10-Q, you should carefully consider the risk factors set forth under Part I, Item 1A, “Risk Factors” in our 2020 Annual Report, which could materially affect our business, financial condition or future results. There have been no material changes to the risk factors previously disclosed in our 2020 Annual Report.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth information about our stock repurchases for the three months ended June 30, 2021:

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (1)
April 1 to April 30		343,894	$	11.21		343,894	$	50,000,192
May 1 to May 31		—		—		—		50,000,192
June 1 to June 30		—		—		—		50,000,192
Total		343,894	$	11.21		343,894	$	50,000,192

(1)$100 million share repurchase program launched in 2020. For more information, see Note 12, “Share Capital,” to our Consolidated Financial Statements.

47

RESOLUTE FOREST PRODUCTS INC.

ITEM 6.    EXHIBITS

Exhibit No.	Description
†10.1	2021 Resolute Forest Products Inc. Short-Term Incentive Plan - U.S.
†10.2	2021 Resolute Forest Products Inc. Short-Term Incentive Plan - Canada / International.
31.1	Certification of President and Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of President and Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Senior Vice President and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	XBRL Instance Document.
101.SCH*	XBRL Taxonomy Extension Schema Document.
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document.

†

This is a management contract or compensatory plan or arrangement.

*

Interactive data files furnished with this Form 10-Q, which represent the following materials from this Form 10-Q formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Changes in Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to Unaudited Interim Consolidated Financial Statements. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document.

48

RESOLUTE FOREST PRODUCTS INC.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

RESOLUTE FOREST PRODUCTS INC.
By	/s/ Sylvain A. Girard
	Sylvain A. Girard
	Senior Vice President and Chief Financial Officer
By	/s/ Daniel Viboux
	Daniel Viboux
	Vice President and Chief Accounting Officer

Date: August 9, 2021

49

EX-10.1

Exhibit 10.1

2021 Short-Term Incentive Plan

United States

Purpose	As a means of rewarding employees for their contribution towards the success of the Company, a 2021 Short-Term Incentive Plan (STIP) has been adopted. The STIP is designed to link a portion of employees’ total compensation to the attainment of specific, measurable, and bottom-line oriented key company performance indicators as well as to recognize and reward individual performance.
Eligibility	The Plan applies to non-unionized, regular, salaried, employees of the Pulp and Paper Group and Wood Products Group working in the United States. Eligibility for or receipt of incentive pay should not be considered as automatic, retroactive or precedent based.
Performance Period	The STIP is tied to the performance of the Company, its divisions and its employees over the period from January 1, 2021 to December 31, 2021.
Plan Design	The STIP is designed to reflect the different employee accountabilities and diversity of positions. In order to tie incentive payouts to employee performance and the achievement of key performance indicators, the STIP’s design is adapted to all groups of employees: Operations, Sales and Corporate.
	The amount of award that employees are eligible to receive is expressed as a certain percentage of their base salary (eligible earnings in the case of non-exempt salaried employees). Base salary is the rate in effect at December 31, 2021. The Company determines the threshold, target and maximum incentive payouts for participants, which vary per grade level. Immediate managers are responsible to inform their employees of their respective threshold, target and maximum incentive award payouts.
Discretionary Plan and Plan Administration	•Incentive payouts are within the complete and sole discretion of the Company. •Before awards are paid, the Company determines and approves achievement of Company performance metrics, individual performance of each eligible employee as well as each payable award, subject to the overall maximum incentive payout described below under “Maximum and Minimum Payout”.
	•The Company has the right to adjust any or all awards; this includes the right to eliminate any or all awards for any year despite achievement of performance metrics, even if such decision is made after the end of the performance period.
	•The Company may modify, suspend, amend or terminate the STIP at any time. •Any payment made under this plan is subject to the Company's recoupment policy.
	•With respect to any employee, the Company reserves the right to reduce or even cancel incentive awards in the event an employee has demonstrated an inadequate level of performance, whether or not the applicable performance metrics have been met.
	•Adjustments may be made to the financial metrics for closure costs, impairment charges and other related charges, severance costs, net loss or gain on the disposition of assets, strategic capital expenditures and similar items.
	•Adjustments may be made to the productivity and the cost metrics for specific reasons such as market downtime, major variation in grade mix, major changes in input price, restructuring or reorganization costs, and similar items.
	•Any adjustment to the performance metrics has to be formally approved before implementation.
	•Awards under the STIP are to be paid in a lump sum no later than March 15, 2022.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20211/7

2021 Short-Term Incentive Plan

United States

Company Performance Metrics & Weighting	Eighty-five percent (85%) of the incentive payout is calculated based on the performance of the Company and its divisions. The table below contains corporate and divisional performance metrics. Company Performance Metrics1
	Criteria		Threshold	Target	Exceeding Target
	Income from operations – Resolute		$152.6M (80% of budget)	$190.7M (budget)	$228.9M (120% of budget)
	Productivity – tons/day or board feet/hour basis (average)2		95% of budget	budget	102% of budget
	Fixed costs2		+2% of budget	budget	-3% of budget
	Usage of variable components2		+2% of budget	budget	-3% of budget
	SG&A costs3		$121.2 M (+2% of budget)	$118.8 M (budget)	$115.2 M (-3% of budget)
	Pulp and paper sales – Profit per metric ton4		80% of budget	budget	120% of budget
	Pulp and paper sales – Improvement of account receivable collection time	Improvement of payment terms	0.80%	1.30%	1.80%
		Improvement of DSO5	0.80%	1.30%	1.80%
	Safety – OSHA rate6		0.70	0.60	≤ 0.50
	Safety – Severity rate7		20	16	≤ 14
	Number of Class 1 & 2 environmental incidents8		17	15	≤ 12

1.Expressed in U.S. dollars.

2.For woodland operations, these metrics will be replaced by fiber cost delivered to the mill.

3.Excluding incentive and equity compensation costs.

4.Performance metrics differ for the Wood Products sales force and the division of Hydro-Saguenay.

5.Improvement of the days sales outstanding.

6.The frequency of safety incidents is the OSHA incident rate measured by the number of recordable incidents (lost time plus temporary assignments or restricted work plus medical treatments), multiplied by 200,000 and divided by the total number of hours worked. The calculation methodology for the mills/divisions varies from the calculation methodology for corporate employees.

7.The severity of safety incidents is measured by the number of days lost due to lost time incidents and incidents resulting in temporary assignments or restricted work, multiplied by 200,000 and divided by the total number of hours worked. . The calculation methodology for the mills/divisions varies from the calculation methodology for corporate employees.

8.Performance is based on the results of the Company, provided that i) pulp and paper mill employees will not be entitled to a payout for the environmental metric if the number of Class 1 & 2 incidents recorded at their respective mill is 4 or.greater and ii) employees of other facilities and divisions will not be entitled to a payout for the environmental metric if the number of Class 1 & 2 incidents recorded at their respective facility or division is 2 or greater.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20212/7

2021 Short-Term Incentive Plan

United States

Company performance weighting
Weighting	Pulp and Paper Mills	Wood Products Divisions	Sales1	Corporate
Income from operations (RFP)	25%	25%	35%	40%
Productivity – tons/day or board feet/hour basis (mill/division) (RFP)2	25%	25%	7%	7%
Fixed costs (mill/division) (RFP)2	12.5%	12.5%	4%	4%
Usage of variable components (mill/division) (RFP)2	12.5%	12.5%	4%	4%
SG&A costs (RFP)			5%	20%
Profit per metric ton			15%
Monthly days sales outstanding – terms			2.5%
Monthly days sales outstanding – days			2.5%
Safety – OSHA (mill/division) (RFP)3	15% (mill)	15% (division)	15% (RFP)	15% (RFP)
Safety – Severity (mill/division) (RFP)3	5% (mill)	5% (division)	5% (RFP)	5% (RFP)
Environmental incidents (RFP)4,5	5%	5%	5% (RFP)	5% (RFP)

1.Weighting and performance metrics differ for the Wood Products sales force and the division of Hydro-Saguenay.

2.Average operations’ payout for corporate employees.

3.Weighted average of divisions’ results, including corporate employees.

4.See note 8 of the previous table.

5.Weighted average of divisions’ results.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20213/7

2021 Short-Term Incentive Plan

United States

Individual Performance Component Fifteen percent (15%) of the incentive payout is calculated based the individual performance of each eligible employee. An Individual Performance Component has been created to better align short-term incentive awards with each eligible employee’s performance. The individual performance payout for each employee will be determined based on each employee’s individual contribution during the performance period, as assessed by management, exercising managerial judgment and subject to the availability of funds in the pool. The individual performance payout can fall in the range of 0% to 30%. In establishing the individual performance payout for each employee, managers consider the following elements during the performance period: Except for the Executive Team (President and Chief Executive Officer and Senior Vice Presidents), the individual performance pool is set at 15% of eligible employees’ incentive targets. However, if the actual achievement of performance metrics by a mill or a division exceeds 100%, the available pool will increase to correspond to 15% of eligible employees’ incentive targets multiplied by the actual performance payout of such mill or division. The portion of the award attributed to individual performance will be calculated as follows:

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20214/7

2021 Short-Term Incentive Plan

United States

	For the Executive Team, the individual performance pool is set at 15% of their incentive targets multiplied by the actual achievement of Corporate performance measures. The portion of the award attributed to individual performance will be calculated as follows:
Maximum and Minimum Payout	The overall maximum incentive payout under the STIP payable 1) to the members of the Executive Team and 2) to the employees in grades 25 and above for the Company performance portion of the incentive payout, cannot exceed 5% of the free cash flow (FCF) generated by the Company in 2021 (maximum available envelope). If the total amount determined based on actual achievement of performance metrics exceeds the maximum available envelope, the incentive awards payable 1) to the members of the Executive Team and 2) to the employees in grades 25 and above for the Company performance portion of the incentive payout, are reduced on a prorata basis. If the total payout determined based on actual achievement of performance metrics is lower than the maximum available envelope, the excess envelope is not distributed to participants.
Cash Flow Measure	For purpose of the STIP, free cash flow is defined as net cash provided by operating activities, less maintenance, safety and environmental capital expenditures, adjusted for:
	•Cash reorganization and restructuring costs •Optional pension contributions towards past service •Other special items
Final Payout Calculation for employees in grades 24 and below
Final Payout Calculation for employees in grades 25 and above

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20215/7

2021 Short-Term Incentive Plan

United States

Final Payout Calculation for Executive Team
Administrative Guidelines	New Hires Employees hired into a regular position on or before September 30, 2021 are eligible to participate in the STIP on a prorated basis, effective upon their date of hire. Employees hired into a regular position on or after October 1, 2021 are not eligible for participation in the STIP.
	Promotion or Status Changes
	•If an employee is promoted or demoted to a position covered by a different incentive payout level, any incentive payout calculation will be prorated for time spent in respective positions. In either case, the base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021.
	•If an employee is transferred internally, any incentive payout calculation will be prorated for time spent in respective locations or groups. The base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021.
	•If an employee’s status changes from temporary salaried, unionized salaried or hourly to regular non-unionized salaried (and vice versa) during the performance period, the employee will be eligible to participate for time spent as a regular non-unionized salaried employee, and any incentive payout calculation will be prorated for time spent as a regular non-unionized salaried employee. The base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021. •If an employee’s status changes between non-exempt and exempt during the year, the incentive payout will be calculated based on eligible earnings for time spent as a non-exempt employee and on the base salary as of December 31, 2021 for time spent as an exempt employee.
	Termination •An employee who retires or who dies during the performance period will be entitled to receive a prorated incentive payout, based on actual achievement for time as an active eligible employee, if and when the Board approves the incentive payouts and does not otherwise cancel payment. For the purpose of this plan, employees are deemed to retire if they are age 58 or above on their last day of active work and have completed at least 2 years of continuous service. Nevertheless, employees who hand in their resignation to start new employment within 3 months of their last day of work are considered to have resigned and not deemed to retire. Notwithstanding the above, the Company reserves the right, at its discretion, to make the final decision on award eligibility.
	•Employees who are involuntarily terminated and whose last day of active work is on or before June 30, 2021 will not be entitled to receive an incentive payout, unless they are deemed to retire pursuant to the previous paragraph.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20216/7

2021 Short-Term Incentive Plan

United States

•An employee who is involuntarily terminated and whose last day of active work is on or after July 1, 2021 will be entitled to receive a prorata amount of an incentive payout, based on actual achievement for time as an active eligible employee, if and when the Board approves the incentive payouts and does not otherwise cancel payment.

•Employees who hand in their resignation before payment is made will not be eligible to receive an award.

•Notwithstanding anything to the contrary, employees who are terminated for cause, as determined at the discretion of the Company or their specific employer, whether during the performance period or after the performance period and before actual payouts, will not receive an award.

Leaves

•Leave without pay: The length of the leave is not included in the calculation of any incentive payout.

•Short-term absence due to illness: The length of the absence is included in the calculation of the incentive payout if it is a bona fide absence pursuant to the disability medical leave procedure.

•Long-term absence due to illness (time on long-term disability): The length of the absence is not included in the calculation of the incentive payout.

Approved by:

/s/ Remi G. Lalonde

Remi G. Lalonde

President and Chief Executive Officer

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 20217/7

EX-10.2

Exhibit 10.2

2021 Short-Term Incentive Plan

Canada/International

Purpose	As a means of rewarding employees for their contribution towards the success of the Company, a 2021 Short-Term Incentive Plan (STIP) has been adopted. The STIP is designed to link a portion of employees’ total compensation to the attainment of specific, measurable, and bottom-line oriented key company performance indicators as well as to recognize and reward individual performance.
Eligibility	The Plan applies to non-unionized, regular, salaried employees working in Canada and in other countries, except the United States. Eligibility for or receipt of incentive pay should not be considered as automatic, retroactive or precedent-based.
Performance Period	The STIP is tied to the performance of the Company, its divisions and its employees over the period from January 1, 2021 to December 31, 2021.
Plan Design	The STIP is designed to reflect the different employee accountabilities and diversity of positions. In order to tie incentive payouts to employee performance and the achievement of key performance indicators, the STIP’s design is adapted to all groups of employees: Operations, Sales and Corporate.
	The amount of award that employees are eligible to receive is expressed as a certain percentage of their base salary. Base salary is the rate in effect at December 31, 2021. The Company determines the threshold, target and maximum incentive payouts for participants, which vary per grade level. Immediate managers are responsible to inform their employees of their respective threshold, target and maximum incentive award payouts.
Discretionary Plan and Plan Administration	•Incentive payouts are within the complete and sole discretion of the Company. •Before awards are paid, the Company determines and approves achievement of Company performance metrics, individual performance of each eligible employee as well as each payable award, subject to the overall maximum incentive payout described below under “Maximum and Minimum Payout”.
	•The Company has the right to adjust any or all awards; this includes the right to eliminate any or all awards for any year despite achievement of performance metrics, even if such decision is made after the end of the performance period.
	•The Company may modify, suspend, amend or terminate the STIP at any time. •Any payment made under this plan is subject to the Company's recoupment policy.
	•With respect to any employee, the Company reserves the right to reduce or even cancel incentive awards in the event an employee has demonstrated an inadequate level of performance, whether or not the applicable performance metrics have been met.
	•Adjustments may be made to the financial metrics for closure costs, impairment charges and other related charges, severance costs, net loss or gain on the disposition of assets, strategic capital expenditures and similar items.
	•Adjustments may be made to the productivity and the cost metrics for specific reasons such as market downtime, major variation in grade mix, major changes in input price, restructuring or reorganization costs, and similar items.
	•Any adjustment to the performance metrics has to be formally approved before implementation.
	•Awards under the STIP are to be paid in a lump sum no later than March 15, 2022.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    1/7

2021 Short-Term Incentive Plan

Canada/International

Company Performance Metrics & Weighting	Eighty-five percent (85%) of the incentive payout is calculated based on the performance of the Company and its divisions. The table below contains corporate and divisional performance metrics. Company Performance Metrics1
	Criteria		Threshold	Target	Exceeding Target
	Income from operations – Resolute		$152.6M (80% of budget)	$190.7M (budget)	$228.9M (120% of budget)
	Productivity - tons/day or board feet/hour basis (average)2		95% of budget	budget	102% of budget
	Fixed costs2		+2% of budget	budget	-3% of budget
	Usage of variable components2		+2% of budget	budget	-3% of budget
	SG&A costs3		$121.2M (+2% of budget)	$118.8M  (budget)	$115.2M (-3% of budget)
	Pulp and paper sales – Profit per metric ton4		80% of budget	budget	120% of budget
	Pulp and paper sales – Improvement of account receivable collection time	Improvement of payment terms	0.008	0.013	0.018
		Improvement of DSO5	0.008	0.013	0.018
	Safety – OSHA rate6		0.7	0.6	≤ 0.50
	Safety – Severity rate7		20	16	≤ 14
	Number of Class 1 & 2 environmental incidents8		17	15	≤ 12

1.Expressed in U.S. dollars.

2.For woodland operations, these metrics will be replaced by fiber cost delivered to the mill.

3.Excluding incentive and equity compensation costs.

4.Performance metrics differ for the Wood Products sales force and the division of Hydro-Saguenay.

5.Improvement of the days sales outstanding.

6.The frequency of safety incidents is the OSHA incident rate measured by the number of recordable incidents (lost time plus temporary assignments or restricted work plus medical treatments), multiplied by 200,000 and divided by the total number of hours worked. The calculation methodology for the mills/divisions varies from the calculation methodology for corporate employees.

7.The severity of safety incidents is measured by the number of days lost due to lost time incidents and incidents resulting in temporary assignments or restricted work, multiplied by 200,000 and divided by the total number of hours worked. . The calculation methodology for the mills/divisions varies from the calculation methodology for corporate employees.

8.Performance is based on the results of the Company, provided that i) pulp and paper mill employees will not be entitled to a payout for the environmental metric if the number of Class 1 & 2 incidents recorded at their respective mill is 4 or.greater and ii) employees of other facilities and divisions will not be entitled to a payout for the environmental metric if the number of Class 1 & 2 incidents recorded at their respective facility or division is 2 or greater.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    2/7

2021 Short-Term Incentive Plan

Canada/International

Company Performance Weighting

Weighting	Pulp and Paper Mills	Wood Products Divisions	Sales1	Corporate
Income from operations (RFP)	25%	25%	35%	40%
Productivity – tons/day or board feet/hour basis (mill/division) (RFP)2	25%	25%	7%	7%
Fixed costs (mill/division) (RFP)2	12.5%	12.5%	4%	4%
Usage of variable components (mill/division) (RFP)2	12.5%	12.5%	4%	4%
SG&A costs (RFP)			5%	20%
Profit per metric ton			15%
Monthly days sales outstanding – terms			2.5%
Monthly days sales outstanding – days			2.5%
Safety – OSHA (mill/division) (RFP)3	15% (mill)	15% (division)	15% (RFP)	15% (RFP)
Safety – Severity (mill/division) (RFP)3	5% (mill)	5% (division)	5% (RFP)	5% (RFP)
Environmental incidents (RFP)4,5	5%	5%	5% (RFP)	5% (RFP)

1.Weighting and performance metrics differ for the Wood Products sales force and the division of Hydro-Saguenay.

2.Average operations’ payout for corporate employees.

3.Weighted average of divisions’ results, including corporate employees.

4.See note 8 of the previous table.

5.Weighted average of divisions’ results.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    3/7

2021 Short-Term Incentive Plan

Canada/International

Individual Performance Component	Fifteen percent (15%) of the incentive payout is calculated based the individual performance of each eligible employee. An Individual Performance Component has been created to better align short-term incentive awards with each eligible employee’s performance. The individual performance payout for each employee will be determined based on each employee’s individual contribution during the performance period, as assessed by management, exercising managerial judgment and subject to the availability of funds in the pool. The individual performance payout can fall in the range of 0% to 30%. In establishing the individual performance payout for each employee, managers consider the following elements during the performance period:
	Except for the Executive Team (President and Chief Executive Officer and Senior Vice Presidents), the individual performance pool is set at 15% of eligible employees’ incentive targets. However, if the actual achievement of performance metrics by a mill or a division exceeds 100%, the available pool will increase to correspond to 15% of eligible employees’ incentive targets multiplied by the actual performance payout of such mill or division. The portion of the award attributed to individual performance will be calculated as follows:

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    4/7

2021 Short-Term Incentive Plan

Canada/International

	For the Executive Team, the individual performance pool is set at 15% of their incentive targets multiplied by the actual achievement of Corporate performance measures. The portion of the award attributed to individual performance will be calculated as follows:
Maximum and Minimum Payout	The overall maximum incentive payout under the STIP payable 1) to the members of the Executive Team and 2) to the employees in grades 25 and above for the Company performance portion of the incentive payout, cannot exceed 5% of the free cash flow (FCF) generated by the Company in 2021 (maximum available envelope). If the total amount determined based on actual achievement of performance metrics exceeds the maximum available envelope, the incentive awards payable 1) to the members of the Executive Team and 2) to the employees in grades 25 and above for the Company performance portion of the incentive payout, are reduced on a prorata basis. If the total payout determined based on actual achievement of performance metrics is lower than the maximum available envelope, the excess envelope is not distributed to participants. There is no minimum payout under the STIP.
Cash Flow Measure	For purpose of the STIP, free cash flow is defined as net cash provided by operating activities, less maintenance, safety and environmental capital expenditures, adjusted for:
	•Cash reorganization and restructuring costs •Optional pension contributions towards past service •Other special items
Final Payout Calculation for employees in grades 24 and below
Final Payout Calculation for employees in grades 25 and above

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    5/7

2021 Short-Term Incentive Plan

Canada/International

Final Payout Calculation for Executive Team
Vacation	Any payment made pursuant to the STIP is deemed to include any and all vacation pay that may be owed pursuant to applicable minimum employment standards.

Administrative Guidelines	New Hires Employees hired into a regular position on or before September 30, 2021 are eligible to participate in the STIP on a prorated basis, effective upon their date of hire. Employees hired into a regular position on or after October 1, 2021 are not eligible for participation in the STIP.
	Promotion or Status Changes
	•If an employee is promoted or demoted to a position covered by a different incentive payout level, any incentive payout calculation will be prorated for time spent in respective positions. In either case, the base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021.
	•If an employee is transferred internally, any incentive payout calculation will be prorated for time spent in respective locations or groups. The base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021.
	•If an employee’s status changes from temporary salaried, unionized salaried or hourly to regular non-unionized salaried (and vice versa) during the performance period, the employee will be eligible to participate for time spent as a regular non-unionized salaried employee, and any incentive payout calculation will be prorated for time spent as a regular non-unionized salaried employee. The base salary rate used to determine the prorated incentive payout will be the base salary rate in effect at December 31, 2021.
	Termination •An employee who retires or who dies during the performance period will be entitled to receive a prorated incentive payout, based on actual achievement for time as an active eligible employee, if and when the Board approves the incentive payouts and does not otherwise cancel payment. For the purpose of this plan, employees are deemed to retire if they are age 57 or above on their last day of active work and have completed at least 2 years of continuous service. Nevertheless, employees who hand in their resignation to start new employment within 3 months of their last day of work are considered to have resigned and not deemed to retire. Notwithstanding the above, the Company reserves the right, at its discretion, to make the final decision on award eligibility.
	•Employees who are involuntarily terminated and whose last day of active work is on or before June 30, 2021 will not be entitled to receive an incentive payout, unless they are deemed to retire pursuant to the previous paragraph.

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    6/7

2021 Short-Term Incentive Plan

Canada/International

•An employee who is involuntarily terminated and whose last day of active work is on or after July 1, 2021 will be entitled to receive a prorata amount of an incentive payout, based on actual achievement for time as an active eligible employee, if and when the Board approves the incentive payouts and does not otherwise cancel payment.

•Employees who hand in their resignation before payment is made will not be eligible to receive an award.

•Notwithstanding anything to the contrary, employees who are terminated for cause, as determined at the discretion of the Company or their specific employer, whether during the performance period or after the performance period and before actual payouts, will not receive an award.

Leaves

•Maternity/parental/adoption leave: The length of the leave is not included in the calculation of any incentive payout.

•Leave without pay: The length of the leave is not included in the calculation of any incentive payout.

•Short-term absence due to illness: The length of the absence is included in the calculation of the incentive payout if it is a bona fide absence pursuant to the disability medical leave procedure.

•Long-term absence due to illness (time on long-term disability): The length of the absence is not included in the calculation of the incentive payout.

Approved by:

/s/ Remi G. Lalonde

Remi G. Lalonde

President and Chief Executive Officer

This plan text replaces and supersedes any and all prior versions and summary fact sheet. It is gender neutral and the masculine form is used only to facilitate its reading.

May 2021                                                    7/7

EX-31.1

EXHIBIT 31.1

Certification

I, Remi G. Lalonde, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarterly period ended June 30, 2021 of RESOLUTE FOREST PRODUCTS INC.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2021

/s/ Remi G. Lalonde

Remi G. Lalonde

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification

I, Sylvain A. Girard, certify that:

1.I have reviewed this quarterly report on Form 10-Q for the quarterly period ended June 30, 2021 of RESOLUTE FOREST PRODUCTS INC.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2021

/s/ Sylvain A. Girard

Sylvain A. Girard

Senior Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of RESOLUTE FOREST PRODUCTS INC. (the “Company”), hereby certifies, to such officer’s knowledge, that the Company’s quarterly report on Form 10‑Q for the quarter ended June 30, 2021 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 9, 2021	/s/ Remi G. Lalonde
	Name: Remi G. Lalonde
	Title: President and Chief Executive Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Resolute Forest Products Inc. and will be retained by Resolute Forest Products Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

EXHIBIT 32.2

Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of RESOLUTE FOREST PRODUCTS INC. (the “Company”), hereby certifies, to such officer’s knowledge, that the Company’s quarterly report on Form 10‑Q for the quarter ended June 30, 2021 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 9, 2021	/s/ Sylvain A. Girard
	Name: Sylvain A. Girard
	Title: Senior Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Resolute Forest Products Inc. and will be retained by Resolute Forest Products Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and is not being filed as part of the Report or as a separate disclosure document.

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Cover Page - shares	6 Months Ended
	Jun. 30, 2021	Jul. 30, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Entity File Number	001-33776
Entity Registrant Name	RESOLUTE FOREST PRODUCTS INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	98-0526415
Entity Address, Address Line One	111 Robert-Bourassa Boulevard
Entity Address, Address Line Two	Suite 5000
Entity Address, City	Montreal
Entity Address, Province	QC
Entity Address, Country	CA
Entity Address, Postal Zip Code	H3C 2M1
City Area Code	514
Local Phone Number	875-2160
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	RFP
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		79,108,264
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001393066
Current Fiscal Year End Date	--12-31

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CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Sales	$ 1,140	$ 612	$ 2,013	$ 1,301
Costs and expenses:
Depreciation and amortization	40	40	81	82
Selling, general and administrative expenses	36	32	82	66
Closure costs, impairment and other related charges	(1)	0	2	(2)
Net gain on disposition of assets	0	(9)	0	(9)
Operating income (loss)	406	6	583	(2)
Interest expense	(5)	(9)	(11)	(18)
Non-operating pension and other postretirement benefit credits	3	4	5	19
Other (expense) income, net	(49)	10	(94)	38
Income before income taxes	355	11	483	37
Income tax provision	(87)	(5)	(127)	(32)
Net income including noncontrolling interest	268	6	356	5
Net income attributable to noncontrolling interest	0	0	(1)	0
Net income attributable to Resolute Forest Products Inc.	$ 268	$ 6	$ 355	$ 5
Net income per share attributable to Resolute Forest Products Inc. common shareholders:
Basic (USD per share)	$ 3.37	$ 0.07	$ 4.42	$ 0.06
Diluted (USD per share)	$ 3.34	$ 0.07	$ 4.39	$ 0.06
Weighted-average number of Resolute Forest Products Inc. common shares outstanding:
Basic (shares)	79.5	88.1	80.4	88.1
Diluted (shares)	80.3	88.2	81.1	88.2
Product
Costs and expenses:
Cost of sales, excluding depreciation and amortization	$ 566	$ 464	$ 1,088	$ 988
Distribution costs
Costs and expenses:
Cost of sales, excluding depreciation and amortization	$ 93	$ 79	$ 177	$ 178

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Statement of Comprehensive Income [Abstract]
Net income including noncontrolling interest	$ 268	$ 6	$ 356	$ 5
Unamortized prior service costs or credits
Change in unamortized prior service costs or credits	(2)	(1)	(3)	(16)
Income tax provision	0	0	0	0
Change in unamortized prior service costs or credits, net of tax	(2)	(1)	(3)	(16)
Unamortized actuarial losses
Change in unamortized actuarial losses	19	15	68	32
Income tax provision	(4)	(4)	(16)	(7)
Change in unamortized actuarial losses, net of tax	15	11	52	25
Foreign currency translation	0	0	0	(1)
Net current period other comprehensive (loss) income	13	10	49	8
Comprehensive income including noncontrolling interest	281	16	405	13
Comprehensive income attributable to noncontrolling interest	0	0	(1)	0
Comprehensive income attributable to Resolute Forest Products Inc.	$ 281	$ 16	$ 404	$ 13

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CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 177	$ 113
Accounts receivable, net:
Trade	309	230
Other	35	48
Inventories, net	492	462
Other current assets	53	47
Total current assets	1,066	900
Fixed assets, net	1,406	1,441
Amortizable intangible assets, net	60	63
Goodwill	31	31
Deferred income tax assets	796	915
Operating lease right-of-use assets	54	60
Other assets	415	320
Total assets	3,828	3,730
Current liabilities:
Accounts payable and other	520	369
Current portion of long-term debt	3	2
Current portion of operating lease liabilities	9	9
Total current liabilities	532	380
Long-term debt, net of current portion	300	559
Pension and other postretirement benefit obligations	1,482	1,562
Operating lease liabilities, net of current portion	50	55
Other liabilities	77	92
Total liabilities	2,441	2,648
Commitments and contingencies
Resolute Forest Products Inc. shareholders’ equity:
Common stock, $0.001 par value. 121.0 million shares issued and 79.1 million shares outstanding as of June 30, 2021; 120.6 million shares issued and 80.8 million shares outstanding as of December 31, 2020	0	0
Additional paid-in capital	3,805	3,804
Deficit	(961)	(1,235)
Accumulated other comprehensive loss	(1,265)	(1,314)
Treasury stock at cost, 41.9 million shares and 39.8 million shares as of June 30, 2021 and December 31, 2020, respectively	(194)	(174)
Total Resolute Forest Products Inc. shareholders’ equity	1,385	1,081
Noncontrolling interest	2	1
Total equity	1,387	1,082
Total liabilities and equity	$ 3,828	$ 3,730

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CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) shares in Millions, $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Accumulated depreciation on fixed assets	$ 1,681	$ 1,604
Accumulated amortization on intangible assets	$ 36	$ 33
Common stock, par value (USD per share)	$ 0.001	$ 0.001
Common stock issued (shares)	121.0	120.6
Common stock outstanding (shares)	79.1	80.8
Treasury stock (shares)	41.9	39.8

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited) - USD ($) $ in Millions	Total	Common Stock	Additional Paid-In Capital	Deficit	Accumulated Other Comprehensive Loss	Treasury Stock	Non-controlling Interest
Balance at beginning of period at Dec. 31, 2019	$ 1,235	$ 0	$ 3,802	$ (1,245)	$ (1,179)	$ (144)	$ 1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation, net of withholding taxes	3		3
Net income	5			5			0
Purchases of treasury stock	(1)					(1)
Special dividend	0
Stock unit awards vested, net of shares forfeited for employee withholding taxes	0
Other comprehensive income, net of tax	8				8		0
Balance at end of period at Jun. 30, 2020	1,250	0	3,805	(1,240)	(1,171)	(145)	1
Balance at beginning of period at Mar. 31, 2020	1,234	0	3,804	(1,246)	(1,181)	(144)	1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation, net of withholding taxes	1		1
Net income	6			6			0
Purchases of treasury stock	(1)					(1)
Special dividend	0
Other comprehensive income, net of tax	10				10		0
Balance at end of period at Jun. 30, 2020	1,250	0	3,805	(1,240)	(1,171)	(145)	1
Balance at beginning of period at Dec. 31, 2020	1,082	0	3,804	(1,235)	(1,314)	(174)	1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation, net of withholding taxes	(1)		(1)
Net income	356			355			1
Purchases of treasury stock	(20)					(20)
Special dividend	(79)		2	(81)
Stock unit awards vested, net of shares forfeited for employee withholding taxes	0
Other comprehensive income, net of tax	49				49		0
Balance at end of period at Jun. 30, 2021	1,387	0	3,805	(961)	(1,265)	(194)	2
Balance at beginning of period at Mar. 31, 2021	1,187	0	3,802	(1,148)	(1,278)	(191)	2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation, net of withholding taxes	1		1
Net income	268			268			0
Purchases of treasury stock	(3)					(3)
Special dividend	(79)		2	(81)
Other comprehensive income, net of tax	13				13		0
Balance at end of period at Jun. 30, 2021	$ 1,387	$ 0	$ 3,805	$ (961)	$ (1,265)	$ (194)	$ 2

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited) (Parenthetical) - shares	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Treasury stock acquired (shares)	2,092,348	253,898
Common Stock
Stock unit awards vested, net of shares forfeited for employee withholding taxes (shares)	400,000	700,000

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Cash flows from operating activities:
Net income including noncontrolling interest	$ 356	$ 5
Adjustments to reconcile net income including noncontrolling interest to net cash provided by operating activities:
Share-based compensation	3	4
Depreciation and amortization	81	82
Deferred income taxes	127	32
Net pension contributions and other postretirement benefit payments	(47)	(48)
Net gain on disposition of assets	0	(9)
(Gain) loss on translation of foreign currency denominated deferred income taxes	(24)	39
Loss (gain) on translation of foreign currency denominated pension and other postretirement benefit obligations	32	(47)
Net planned major maintenance payments	(9)	(2)
Changes in working capital:
Accounts receivable	(61)	50
Inventories	(30)	25
Other current assets	(2)	(7)
Accounts payable and other	36	(49)
Other, net	13	1
Net cash provided by operating activities	475	76
Cash flows from investing activities:
Cash invested in fixed assets	(47)	(37)
Acquisition of business, net of cash acquired	0	(172)
Disposition of assets	0	9
Increase in countervailing and anti-dumping duty cash deposits on softwood lumber	(89)	(32)
Other investing activities, net	3	5
Net cash used in investing activities	(133)	(227)
Cash flows from financing activities:
Net repayments under revolving credit facilities	0	(2)
Issuance of long-term debt	300	0
Proceeds from long-term debt	0	180
Repayments of debt	(557)	(1)
Purchases of treasury stock	(20)	(1)
Payments of financing fees	(7)	0
Other financing activities, net	2	0
Net cash (used in) provided by financing activities	(282)	176
Effect of exchange rate changes on cash and cash equivalents, and restricted cash	0	(1)
Net increase (decrease) in cash and cash equivalents, and restricted cash	60	24
Cash and cash equivalents, and restricted cash:
Beginning of period	159	42
End of period	219	66
Cash and cash equivalents, and restricted cash at end of period:
Cash and cash equivalents	177	27
Restricted cash (included in “Other assets”)	$ 42	$ 39

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Organization and Basis of Presentation

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Basis of Presentation

Note 1. Organization and Basis of Presentation

Nature of operations

Resolute Forest Products Inc. (with its subsidiaries, either individually or collectively, unless otherwise indicated, referred to as “Resolute Forest Products,” “we,” “our,” “us,” “Parent,” or the “Company”) is incorporated in Delaware. We are a global leader in the forest products industry with a diverse range of products, including market pulp, tissue, wood products, and paper, which are marketed in over 50 countries. We own or operate some 40 facilities as well as power generation assets, in the U.S. and Canada.

Financial statements

Our unaudited interim consolidated financial statements and accompanying notes (or, the “Consolidated Financial Statements”) have been prepared in accordance with the requirements of the U.S. Securities and Exchange Commission (or, the “SEC”) for interim reporting. Under those rules, certain footnotes and other financial information that are normally required by U.S. generally accepted accounting principles (or, “GAAP”) may be condensed or omitted. In our opinion, all adjustments (consisting of normal recurring adjustments) necessary for the fair statement of the Consolidated Financial Statements have been made. All amounts are expressed in U.S. dollars, unless otherwise indicated. The results for the interim period ended June 30, 2021, are not necessarily indicative of the results to be expected for the full year. These Consolidated Financial Statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021. Certain prior period amounts in the notes to our Consolidated Financial Statements have been reclassified to conform to the 2021 presentation.

New accounting pronouncement adopted in 2021

ASU 2019-12 “Simplifying the Accounting for Income Taxes”

Effective January 1, 2021, we adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes,” issued by the Financial Accounting Standards Board (or, “FASB”) in 2019, which removes the specific exceptions to the general principles in ASC 740, “Income Taxes,” and clarifies certain aspects of the existing guidance. The adoption of this accounting guidance did not impact our Consolidated Financial Statements and disclosures.

Accounting pronouncement not yet adopted as of June 30, 2021

ASU 2020-04 “Reference Rate Reform”

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform,” amended in January by ASU 2021-01, “Reference Rate Reform - Scope,” which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. This update provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform. This update is effective as of March 12, 2020, through December 31, 2022. We are currently evaluating this accounting guidance and have not elected an adoption date. We do not expect this accounting guidance to materially impact our results of operations or financial position.

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Other (Expense) Income, Net

6 Months Ended

Jun. 30, 2021

Other Income and Expenses [Abstract]

Other (Expense) Income, Net

Note 2. Other (Expense) Income, Net

Other (expense) income, net for the three and six months ended June 30, 2021 and 2020, was comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Foreign exchange (loss) gain	$	(6)	$	(9)	$	(11)	$	14
(Loss) gain on commodity contracts (1)		(49)		—		(86)		4
Insurance recovery (2)		—		15		—		15
Miscellaneous income		6		4		3		5
	$	(49)	$	10	$	(94)	$	38

(1)    Principally related to lumber futures contracts; none of these contracts were outstanding as of June 30, 2021.

(2)    We recorded $15 million as other income for the three and six months ended June 30, 2020, from the settlement of an insurance claim in connection with our acquisition of Atlas Paper Holdings, Inc. (or, “Atlas”) in 2015.

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Accumulated Other Comprehensive Loss

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Accumulated Other Comprehensive Loss

Note 3. Accumulated Other Comprehensive Loss

The change in our accumulated other comprehensive loss by component (net of tax) for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2021	$	(2)	$	(1,270)	$	(6)	$	(1,278)
Amounts reclassified from accumulated other comprehensive loss		(2)		15		—		13
Net current period other comprehensive (loss) income		(2)		15		—		13
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)
(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2020	$	(1)	$	(1,307)	$	(6)	$	(1,314)
Other comprehensive income before reclassifications (1)		—		22		—		22
Amounts reclassified from accumulated other comprehensive loss		(3)		30		—		27
Net current period other comprehensive (loss) income		(3)		52		—		49
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)

(1)    The indefinite idling of the Amos and Baie-Comeau (Quebec) mills triggered curtailment and remeasurement of the pension and other postretirement benefit (or, “OPEB”) obligations related to their plans as of March 31, 2021, resulting in a curtailment gain of $8 million and an actuarial gain of $22 million, totaling $30 million ($22 million net of tax).

(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2020	$	1	$	(1,175)	$	(7)	$	(1,181)
Amounts reclassified from accumulated other comprehensive loss		(1)		11		—		10
Net current period other comprehensive (loss) income		(1)		11		—		10
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)
(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2019	$	16	$	(1,189)	$	(6)	$	(1,179)
Other comprehensive loss before reclassifications		—		—		(1)		(1)
Amounts reclassified from accumulated other comprehensive loss		(16)		25		—		9
Net current period other comprehensive (loss) income		(16)		25		(1)		8
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)

The reclassifications out of accumulated other comprehensive loss for the three and six months ended June 30, 2021 and 2020, were comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020		Affected Line in the Consolidated Statements of Operations
Unamortized Prior Service Costs or Credits
Amortization of prior service costs or credits	$	(2)	$	(1)	$	(2)	$	(2)	Non-operating pension and other postretirement benefit credits (1)
Curtailment gain		—		—		(1)		(14)	Non-operating pension and other postretirement benefit credits (1)
		—		—		—		—	Income tax provision
Net of tax		(2)		(1)		(3)		(16)
Unamortized Actuarial Losses
Amortization of actuarial losses		19		15		38		29	Non-operating pension and other postretirement benefit credits (1)
Other items		—		—		—		3
		(4)		(4)		(8)		(7)	Income tax provision
Net of tax		15		11		30		25
Total Reclassifications	$	13	$	10	$	27	$	9

(1)These items are included in the computation of net periodic benefit cost (credit) related to our pension and OPEB plans summarized in Note 9, “Employee Benefit Plans.”

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Net Income Per Share

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Net Income Per Share

Note 4. Net Income Per Share

The reconciliation of the basic and diluted net income per share for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except per share amounts)	2021		2020		2021		2020
Numerator:
Net income attributable to Resolute Forest Products Inc.	$	268	$	6	$	355	$	5
Denominator:
Weighted-average number of Resolute Forest Products Inc. common shares outstanding		79.5		88.1		80.4		88.1
Dilutive impact of nonvested stock unit awards and stock options		0.8		0.1		0.7		0.1
Diluted weighted-average number of Resolute Forest Products Inc. common shares outstanding		80.3		88.2		81.1		88.2
Net income per share attributable to Resolute Forest Products Inc. common shareholders:
Basic	$	3.37	$	0.07	$	4.42	$	0.06
Diluted	$	3.34	$	0.07	$	4.39	$	0.06

The weighted-average number of outstanding stock options and nonvested equity-classified restricted stock units, deferred stock units and performance stock units (collectively, “stock unit awards”) that were excluded from the calculation of diluted

net income per share, as their impact would have been antidilutive, for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(Unaudited, in millions)	2021	2020	2021	2020
Stock options	0.4	0.9	0.5	0.9
Stock unit awards	—	0.9	—	0.9

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Inventories, Net

6 Months Ended

Jun. 30, 2021

Inventory Disclosure [Abstract]

Inventories, Net

Note 5. Inventories, Net

Inventories, net as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Raw materials	$	132	$	132
Work in process		55		46
Finished goods		138		120
Mill stores and other supplies		167		164
	$	492	$	462

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Other Assets

6 Months Ended

Jun. 30, 2021

Other Assets [Abstract]

Other Assets

Note 6. Other Assets

Other assets include countervailing and anti-dumping duty cash deposits on softwood lumber of $278 million and $54 million, respectively, as of June 30, 2021, and of $194 million and $49 million, respectively, as of December 31, 2020. See Note 11, “Commitments and Contingencies” for more information.

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Accounts Payable and Other

6 Months Ended

Jun. 30, 2021

Payables and Accruals [Abstract]

Accounts Payable and Other

Note 7. Accounts Payable and Other

Accounts payable and other as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Trade accounts payable	$	300	$	251
Accrued compensation		69		76
Accrued interest		7		4
Pension and other postretirement benefit obligations		15		14
Special dividend payable (1)		79		—
Accrued provision related to Fibrek Inc. litigation (Note 11)		21		—
Income and other taxes payable		5		5
Other		24		19
	$	520	$	369

(1)    On June 10, 2021, we declared a special dividend of $1.00 per share ($79 million) on our common stock. See Note 12, “Share Capital,” for more information.

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Long-Term Debt

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Long-term Debt

Note 8. Long-Term Debt

Overview

Long-term debt, including current portion, as of June 30, 2021 and December 31, 2020, was comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
4.875% senior unsecured notes due 2026:
Principal amount	$	300	$	—
Deferred financing costs		(6)		—
Total 4.875% senior unsecured notes due 2026		294		—
5.875% senior unsecured notes due 2023:
Principal amount		—		375
Deferred financing costs		—		(2)
Unamortized discount		—		(1)
Total 5.875% senior unsecured notes due 2023		—		372
Senior secured credit facility - Term loans due 2030		—		180
Finance lease obligations		7		9
Other debt		2		—
Total debt		303		561
Less: Current portion of finance lease obligations and other debt		(3)		(2)
Long-term debt, net of current portion	$	300	$	559

Senior Unsecured Notes

2026 Notes

On February 2, 2021, we issued $300 million aggregate principal amount of 4.875% senior unsecured notes due 2026 (or, the “2026 Notes”) at an issue price of 100%, pursuant to an indenture as of that date (or, the “Indenture”). Upon their issuance, the 2026 Notes were recorded at their fair value of $300 million. Interest on the 2026 Notes is payable semi-annually on March 1 and September 1 of each year, beginning on September 1, 2021, until their maturity date of March 1, 2026. In connection with the issuance of the 2026 Notes, we incurred financing costs of $6 million, which were deferred and recorded as a reduction of the principal. Deferred financing costs are amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the notes.

The 2026 Notes are guaranteed by current and future wholly-owned U.S. subsidiaries that guarantee the ABL Credit Facility and the Senior Secured Credit Facility (each, as defined and discussed below). The notes are unsecured and effectively junior to indebtedness under each of the ABL Credit Facility, the Senior Secured Credit Facility, the Loan Facility and future secured indebtedness to the extent of the value of the collateral that secures such indebtedness. In addition, the notes are structurally subordinated to all existing and future indebtedness (including the Loan Facility) and other liabilities of our subsidiaries that do not guarantee the notes, including all our non-U.S. subsidiaries.

The terms of the Indenture impose certain restrictions, subject to a number of exceptions and qualifications, including limits on our ability to: incur additional indebtedness or issue certain preferred shares; make dividend payments on or make other distributions in respect of our capital stock or make other restricted payments; make certain investments; sell certain assets; create liens on assets; consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and enter into certain transactions with our affiliates.

In the event of specified change of control triggering events, we shall be required to offer to repurchase the 2026 Notes at 101% of the principal amount, plus accrued and unpaid interest.

On or after March 1, 2023, we may redeem the notes at our option, in whole at any time or in part from time to time, at redemption prices equal to a percentage of the principal amount plus accrued and unpaid interest, as follows:

Year (beginning March 1)	Redemption Price
2023	102.438	%
2024	101.219	%
2025 and thereafter	100.000	%

The fair value of the 2026 Notes (Level 1) was $311 million as of June 30, 2021.

2023 Notes

We issued $600 million in aggregate principal amount of 5.875% senior unsecured notes due 2023 (or, the “2023 Notes”) on May 8, 2013. Upon their issuance, the 2023 Notes were recorded at their fair value of $594 million, which reflected a discount of $6 million that was being amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the 2023 Notes, resulting in an effective interest rate of 6%. Interest on the 2023 Notes was payable semi-annually beginning November 15, 2013. In connection with the issuance of the 2023 Notes, we incurred financing costs of $9 million, which were deferred and recorded as a reduction of the 2023 Notes. Deferred financing costs were amortized to “Interest expense” in our Consolidated Statements of Operations using the interest method over the term of the 2023 Notes.

On January 3, 2019, we repurchased $225 million in aggregate principal amount of the 2023 Notes, pursuant to a notes purchase agreement entered into on December 21, 2018, with certain noteholders, at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest.

On February 2, 2021, we placed the net proceeds from the issuance of the 2026 Notes together with additional cash, into trust for the benefit of the holders of the 2023 Notes to redeem all of the $375 million aggregate principal amount of the 2023 Notes (or, the “Redemption”) at a price of 100% of the aggregate principal amount thereof, plus accrued and unpaid interest to, but not including, the redemption date. The Redemption occurred on February 18, 2021. As a result of the repurchase, we recorded a net loss on extinguishment of debt of $3 million in “Other (expense) income, net” in our Consolidated Statement of Operations for the six months ended June 30, 2021.

The fair value of the 2023 Notes (Level 1) was $375 million as of December 31, 2020.

Senior Secured Credit Facility

On September 7, 2016, we entered into a senior secured credit facility for up to $185 million. This senior secured credit facility provided a term loan of $46 million with a maturity date of September 7, 2025, and a revolving credit facility of up to $139 million with a maturity date of September 7, 2022. On October 28, 2019, we entered into an amended and restated senior secured credit facility for up to $360 million, which provided a term loan facility of up to $180 million and a revolving credit facility of up to $180 million with a maturity date of October 28, 2025 for the latter, and repaid our $46 million term loan under the original senior secured credit facility. In March 2020, we borrowed $180 million in term loans for ten years, maturing in March 2030.

On April 19, 2021 (or, the “Effective Date”), we entered into a first amendment to the amended and restated senior secured credit facility (or, the “Senior Secured Credit Facility”). The amount available under the Senior Secured Credit Facility remains unchanged for up to $360 million and is comprised of a term loan facility of up to $180 million with a delayed draw period of up to three years and the choice of maturities of six to ten years from the date of drawing (or, the “Term Loan Facility”); and a six-year revolving credit facility of up to $180 million (or, the “Revolving Credit Facility”). On the Effective Date, we repaid our $180 million term loans under the amended and restated senior secured credit facility with a combination of proceeds of borrowings under the Revolving Credit Facility and cash on hand. The amendment then reinstated the full amount of the Term Loan Facility. There is also an uncommitted option to increase the Senior Secured Credit Facility by up to an additional $360 million, subject to certain terms and conditions.

The obligations under the Senior Secured Credit Facility continue to be guaranteed by certain material U.S. subsidiaries of the Company and remain secured by first priority liens on assets of our Calhoun (Tennessee) facility. Interest rates under the Senior Secured Credit Facility are based, at the Company’s election, on either a floating rate based on the LIBOR, or a base rate, in each case plus a spread over the index. In addition, loans under the Term Loan Facility can bear interest at a fixed rate plus a spread. For loans under the Term Loan Facility, the applicable spread ranges from 0.5% to 1.4% for base rate loans, from 1.5%

to 2.4% for LIBOR rate loans, and from 1.7% to 2.1% for fixed rate loans. For the Revolving Credit Facility, the applicable spread ranges from 0.5% to 1.0% for base rate loans, and from 1.5% to 2.0% for LIBOR rate loans. The amended credit agreement contains customary covenants, representations and warranties, and events of default.

As of June 30, 2021, we had $180 million of availability under the Term Loan Facility and $180 million of availability under the Revolving Credit Facility, which were undrawn. The fair values of the term loans (Level 2) approximated their carrying values and were bearing interest at LIBOR plus a spread of 2.13% as of December 31, 2020.

ABL Credit Facility

On May 14, 2019, we entered into an amended senior secured asset-based revolving credit facility (or, the “ABL Credit Facility”) with an aggregate lender commitment of up to $500 million at any time outstanding, subject to borrowing base availability based on specified advance rates, eligibility criteria and customary reserves. The amended credit agreement provides for an extension of the maturity date to May 14, 2024.

Effective January 21, 2021, we reduced the commitment under the Canadian tranche of our senior secured asset-based revolving credit facility by $50 million, to $250 million, resulting in an aggregate commitment of $450 million, subject to borrowing base limitations. The obligations under the ABL Credit Facility are guaranteed by certain of our material subsidiaries.

As of June 30, 2021, we had $336 million of borrowing base availability under the ABL Credit Facility, which was undrawn except for $67 million of ordinary course letters of credit outstanding.

Loan Facility

On November 4, 2020, our Canadian subsidiary, Resolute FP Canada Inc., entered into a secured delayed draw term loan facility (or, the “Loan Facility”) with Investissement Québec as lender for up to C$220 million ($177 million as of June 30, 2021), subject to borrowing base availability based on 75% of the countervailing and anti-dumping duty deposits imposed by the U.S. Department of Commerce and collected by Customs and Border Protection Agency on U.S. imports of applicable softwood lumber products produced at sawmills of the Borrower and its affiliates located in the province of Quebec, Canada from April 28, 2017 to December 31, 2022. The Loan Facility will bear interest at a floating rate equal to 1.45% above the one month Canadian banker’s acceptance rate. The principal shall be repayable in monthly installments over a period of eight years after an interest only period of two years from the date of the first draw. The Loan Facility is subject to prepayment requirements under certain conditions and may be repaid earlier without premium or penalty, but subject to prepayment of accrued and unpaid interest. The Loan Facility provides for a maximum of ten draws and the fulfillment of certain conditions upon each draw. Borrowings are subject to certain restrictions.

As of June 30, 2021, we had C$220 million ($177 million) of borrowing base availability under the Loan Facility, which was undrawn.

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Employee Benefit Plans

6 Months Ended

Jun. 30, 2021

Retirement Benefits [Abstract]

Employee Benefit Plans

Note 9. Employee Benefit Plans

Pension and other postretirement benefit plans

The components of net periodic benefit costs (credits) relating to our pension and OPEB plans for the three and six months ended June 30, 2021 and 2020, were as follows:

Pension Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	34	$	36	$	67	$	74
Expected return on plan assets		(55)		(55)		(109)		(111)
Amortization of actuarial losses		20		17		41		32
Non-operating pension credits		(1)		(2)		(1)		(5)
Service cost		4		3		8		7
Net periodic benefit costs before special events		3		1		7		2
Other (gain) loss		—		—		(1)		3
	$	3	$	1	$	6	$	5

OPEB Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	1	$	1	$	2	$	2
Amortization of actuarial gains		(1)		(2)		(3)		(3)
Amortization of prior service credits		(2)		(1)		(2)		(2)
Non-operating other postretirement benefit credits		(2)		(2)		(3)		(3)
Service cost		—		1		—		1
Net periodic benefit credits before special events		(2)		(1)		(3)		(2)
Curtailment gain		—		—		—		(14)
	$	(2)	$	(1)	$	(3)	$	(16)

Defined contribution plans

Our expense for the defined contribution plans totaled $4 million for the three months ended June 30, 2021 and 2020, and $9 million and $8 million for the six months ended June 30, 2021 and 2020, respectively.

U.S. pension funding

The American Rescue Plan Act of 2021 includes provisions that allow for interest rate smoothing of pension funding deficits to minimize the impact of lower interest rates on liabilities. It also extends the amortization period for funding shortfalls from seven years to 15 years under the current rules. We estimate that the impact of the Act on our previously disclosed estimated contributions for 2021 will be a reduction of $13 million.

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Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Note 10. Income Taxes

The income tax provision attributable to income before income taxes differs from the amounts computed by applying the U.S. federal statutory income tax rate of 21% for the three and six months ended June 30, 2021 and 2020, as a result of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Income before income taxes	$	355	$	11	$	483	$	37
Income tax provision:
Expected income tax provision		(74)		(3)		(101)		(8)
Changes resulting from:
Valuation allowance on our U.S. operations		70		(7)		78		(16)
Foreign exchange		1		2		3		(10)
U.S. tax on non-U.S. earnings		(65)		—		(83)		—
State income taxes, net of federal income tax benefit		—		—		2		2
Foreign tax rate differences		(19)		(2)		(27)		(5)
Other, net (1)		—		5		1		5
	$	(87)	$	(5)	$	(127)	$	(32)

(1)    Includes $4 million for the three and six months ended June 30, 2020, related to the settlement of an insurance claim in connection with our acquisition of Atlas.

During the three and six months ended June 30, 2021, we used $70 million and $78 million, respectively, of deferred income tax assets that were fully reserved to offset mainly the tax implications relating to the global intangible low-taxed income inclusion, which is based on the U.S. system of taxation for non-U.S. earnings, whereby foreign earnings less a qualified deduction for foreign assets are included in U.S. taxable income.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 11. Commitments and Contingencies

Legal matters

We become involved in various legal proceedings, claims and governmental inquiries, investigations, and other disputes in the normal course of business, including matters related to contracts, commercial and trade disputes, taxes, environmental issues, activist damages, employment and workers’ compensation claims, grievances, human rights complaints, pension and benefit plans and obligations, health and safety, product safety and liability, asbestos exposure, financial reporting and disclosure obligations, corporate governance, Indigenous peoples’ claims, antitrust, governmental regulations, and other matters. Although the final outcome is subject to many variables and cannot be predicted with any degree of certainty, we regularly assess the status of the matters and establish provisions (including legal costs expected to be incurred) when we believe an adverse outcome is probable, and the amount can be reasonably estimated. Any recovery from litigation or settlement of claims that is a gain contingency is recognized if, and when, realized or realizable. Except as described below and for claims that cannot be assessed due to their preliminary nature, we believe that the ultimate disposition of these matters outstanding or pending as of June 30, 2021, will not have a material adverse effect on our Consolidated Financial Statements.

Asbestos-related lawsuits

We are involved in a number of asbestos-related lawsuits filed primarily in U.S. state courts, including certain cases involving multiple defendants. These lawsuits principally allege direct or indirect personal injury or death resulting from exposure to asbestos-containing premises. While we dispute the plaintiffs’ allegations and intend to vigorously defend these claims, the ultimate resolution of these matters cannot be determined at this time. These lawsuits frequently involve claims for unspecified compensatory and punitive damages, and we are unable to reasonably estimate a range of possible losses. However, unfavorable rulings, judgments or settlement terms could materially impact our Consolidated Financial Statements. Hearings for certain of these matters are scheduled to occur in the next twelve months.

Countervailing duty and anti-dumping investigations on softwood lumber

On November 25, 2016, countervailing duty and anti-dumping petitions were filed with the U.S. Department of Commerce (or, “Commerce”) and the U.S. International Trade Commission (or, “ITC”) by certain U.S. softwood lumber products producers and forest landowners, requesting that the U.S. government impose countervailing and anti-dumping duties on Canadian-origin softwood lumber products exported to the U.S. One of our subsidiaries was identified in the petitions as being a Canadian exporting producer of softwood lumber products to the U.S. and was selected as a mandatory respondent to be investigated by Commerce in both the countervailing duty and anti-dumping investigations.

On April 24, 2017, Commerce announced its preliminary determination in the countervailing duty investigation and, as a result, after April 28, 2017, we were required to pay cash deposits to the U.S. Customs and Border Protection agency (or, “U.S. Customs”) at a rate of 12.82% for estimated countervailing duties on the vast majority of our U.S. imports of softwood lumber products produced at our Canadian sawmills. The preliminary rate remained in effect until August 26, 2017. Commerce changed the rate in its final affirmative determination on November 2, 2017, but the new rate did not take effect until December 28, 2017, following the ITC’s final affirmative determination and the publication by Commerce of a countervailing duty order. Until November 30, 2020, we were required to pay cash deposits to U.S. Customs at a rate of 14.70% for the vast majority of our U.S. imports of Canadian-produced softwood lumber products. On December 1, 2020, Commerce issued its final results in the countervailing duties first administrative review and established our new rate at 19.10% for countervailing duties. This rate applies until Commerce sets a new duty rate in subsequent administrative reviews, or a new rate may be set through a remand determination by a binational panel formed pursuant to the North American Free Trade Agreement or United States-Mexico-Canada Agreement, as the case may be (or, “Panel”) on appeal. On May 20, 2021, Commerce issued its preliminary rates in the countervailing duties second administrative review and established our new preliminary rate at 18.17% for countervailing duties. The preliminary rate will not take effect until the publication by Commerce of the final results. During the six months ended June 30, 2021, we made additional cash deposits of $84 million, bringing our total to $278 million.

On June 26, 2017, Commerce announced its preliminary determination in the anti-dumping investigation and, as a result, after June 30, 2017, we were required to pay cash deposits to U.S. Customs at a rate of 4.59% for estimated anti-dumping duties on the vast majority of our U.S. imports of softwood lumber products produced at our Canadian sawmills. On November 2, 2017, Commerce announced its final affirmative determination in the anti-dumping investigation and, as a result, from November 8, 2017 to November 29, 2020, we were required to pay cash deposits to U.S. Customs, at a rate of 3.20% for the vast majority of our U.S. imports of Canadian-produced softwood lumber products. On November 30, 2020, Commerce issued its final results in the anti-dumping first administrative review and established our new rate at 1.15% for anti-dumping duties. This rate applies until Commerce sets a duty rate in subsequent administrative reviews, or a new rate may be set through a remand determination by a Panel on appeal. On May 20, 2021, Commerce issued its preliminary rates in the anti-dumping second administrative review and established the new “all-others” preliminary rate at 12.05% for anti-dumping duties. The preliminary rate will not take effect until the publication by Commerce of the final results. During the six months ended June 30, 2021, we made additional cash deposits of $5 million, bringing our total to $54 million.

On April 1, 2019, Commerce published a notice initiating the administrative reviews of the countervailing duty and anti-dumping orders on softwood lumber products from Canada and we were selected as a mandatory respondent in these administrative reviews. On March 10, 2020, Commerce published a notice initiating the second administrative review of the countervailing duty and anti-dumping orders on softwood lumber products from Canada. We were selected as a mandatory respondent for the second administrative review of the countervailing duty order and we are in the process of responding to Commerce with the information required. On March 4, 2021, Commerce published a notice initiating the third administrative review of the countervailing duty and anti-dumping orders on softwood lumber products from Canada. We were selected as a mandatory respondent for the third administrative review of the countervailing duty order and we are in the process of responding to Commerce with the information required.

In parallel, on September 4, 2019, a Panel issued an interim decision upholding the affirmative final injury determinations of the ITC in both investigations of softwood lumber products from Canada. The Panel remanded the ITC to reconsider several findings and ordered the ITC to submit its redetermination on remand within 90 days from the date of the Panel interim decision. On December 19, 2019, the ITC issued its redetermination on remand that maintained the affirmative final injury determinations, and on May 22, 2020, the Panel issued its final decision and affirmed in its entirety the ITC’s injury determination on remand. On January 6, 2021, and January 19, 2021, we filed our complaints supporting Panel reviews of the final results in the countervailing and anti-dumping first administrative reviews.

In addition, on August 24, 2020, the World Trade Organization’s (or, “WTO”) dispute panel issued a report (or, the “Panel Report”) in the case brought by the government of Canada in “United States — Countervailing Measures on Softwood Lumber

from Canada” (DS533), concluding, among other things, that Commerce acted inconsistently with the Agreement on Subsidies and Countervailing Measures on most of the matters. On September 28, 2020, the United States notified the WTO’s dispute settlement body of its decision to appeal the Panel Report.

We are not presently able to determine the ultimate resolution of these matters, but we believe it is not probable that we will ultimately be assessed with significant duties, if any, on our U.S. imports of Canadian-produced softwood lumber products. Accordingly, no contingent loss was recorded in respect of these petitions in our Consolidated Statements of Operations, and our cash deposits are recorded in “Other assets” in our Consolidated Balance Sheets.

Fibrek acquisition

Effective July 31, 2012, we completed the final step of the transaction pursuant to which we acquired the remaining 25.40% of the outstanding Fibrek Inc. shares, following the approval of Fibrek’s shareholders on July 23, 2012, and the issuance of a final order by the Quebec Superior Court in Canada (or, the “Quebec Superior Court”) approving the arrangement on July 27, 2012. Certain former shareholders of Fibrek exercised rights of dissent in respect of the transaction, asking for a judicial determination of the fair value of their claim under the Canada Business Corporations Act. On September 26, 2019, the Quebec Superior Court rendered a decision fixing the fair value of the shares of the dissenting shareholders at C$1.99 per share, or C$31 million in aggregate, plus interest and an additional indemnity, for a total then estimated at C$44 million payable in cash. We had previously accrued C$14 million for the payment of the dissenting shareholders’ claims. Following the court decision, we accrued an additional C$30 million ($23 million). Of the total amount of C$44 million, C$19 million ($14 million) was payable immediately and paid on October 2, 2019. The remaining balance of C$27 million as of June 30, 2021 and C$26 million as of December 31, 2020 ($21 million and $20 million as of June 30, 2021 and December 31, 2020, respectively), which includes accrued interest, is recorded in “Accounts payable and other” as of June 30, 2021, and in “Other liabilities” as of December 31, 2020, in our Consolidated Balance Sheets. We are appealing the decision, therefore the payment of any additional consideration and its timing will depend on the outcome of the appeal. On November 13, 2019, a legal hypothec in the amount of C$30 million was registered on our Saint-Félicien (Quebec) immovable and movable property to secure the payment of any additional amounts following the outcome of the appeal. The hearing in this matter is expected to occur in the next 12 months.

Partial wind-ups of pension plans

On June 12, 2012, we filed a motion for directives with the Quebec Superior Court, the court with jurisdiction in the creditor protection proceedings under the Companies’ Creditors Arrangement Act (Canada) (or, the “CCAA Creditor Protection Proceedings”), seeking an order to prevent pension regulators in each of Quebec, New Brunswick, and Newfoundland and Labrador from declaring partial wind-ups of pension plans relating to employees of former operations in New Brunswick, and Newfoundland and Labrador, or a declaration that any claim for accelerated reimbursements of deficits arising from a partial wind-up is a barred claim under the CCAA Creditor Protection Proceedings. We contend, among other things, that any such declaration, if issued, would be inconsistent with the Quebec Superior Court’s sanction order confirming the CCAA debtors’ CCAA Plan of Reorganization and Compromise, as amended, and the terms of our emergence from the CCAA Creditor Protection Proceedings. A partial wind-up would likely shorten the period in which any deficit within those plans, which could reach up to C$150 million ($121 million), would have to be funded if we do not obtain the relief sought. The hearing in this matter has not yet been scheduled but could occur in the next twelve months.

Environmental matters

We are subject to a number of federal or national, state, provincial, and local environmental laws, regulations, and orders in various jurisdictions. We believe our operations are in material compliance with current applicable environmental laws and regulations. Environmental regulations promulgated and orders issued in the future could require substantial additional expenditures for compliance and could have a material impact on us, in particular, and the industry in general.

We have environmental liabilities of $13 million and $15 million recorded as of June 30, 2021 and December 31, 2020, respectively, primarily related to environmental remediation, assessment, monitoring and management related to closed or idled sites. The amount of these liabilities represents management’s estimate of the ultimate settlement based on an assessment of relevant factors and assumptions and could be affected by changes in facts or assumptions not currently known to management for which the outcome cannot be reasonably estimated at this time.

We also have asset retirement obligations of $27 million and $25 million recorded as of June 30, 2021 and December 31, 2020, respectively, primarily consisting of liabilities associated with landfills, sludge basins and the dismantling of retired assets.

These liabilities are included in “Accounts payable and other” and “Other liabilities” in our Consolidated Balance Sheets.

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Share Capital

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Share Capital

Note 12. Share Capital

Treasury stock

On March 2, 2020, our board of directors authorized a share repurchase program of up to 15% of our common stock, for an aggregate consideration of up to $100 million. During the three and six months ended June 30, 2021, we repurchased 343,894 shares at an average price of $11.21 for a total of $3 million and 2,092,348 shares at an average price of $9.78 for a total of $20 million, respectively. We repurchased 253,898 shares at an average price of $2.09 for a total of $1 million during the three and six months ended June 30, 2020.

Dividends

We declared a special dividend of $1.00 per share ($79 million) on our common stock during the three and six months ended June 30, 2021, which was recorded in “Accounts payable and other” in our Consolidated Balance Sheet as of June 30, 2021. The dividend was paid to shareholders on July 7, 2021. We did not declare or pay any dividends on our common stock during the three and six months ended June 30, 2020.

Under some of our compensation plans, participants are credited additional units when a dividend is declared. The impact of the special dividend was as follows: for the three and six months ended June 30, 2021, $3 million was recognized as a compensation expense, and $2 million as an increase in deficit and in additional paid-in capital; and $3 million as an increase in liabilities as of June 30, 2021.

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Segment Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

Note 13. Segment Information

We manage our business based on the products we manufacture. Accordingly, our reportable segments correspond to our principal product lines: market pulp, tissue, wood products, and paper.

None of the income or loss items following “Operating income (loss)” in our Consolidated Statements of Operations are allocated to our segments, since those items are reviewed separately by management. For the same reason, closure costs, impairment and other related charges, gains and losses on disposition of assets, as well as other discretionary charges or credits are not allocated to our segments. We allocate depreciation and amortization expense to our segments, although the related fixed assets and amortizable intangible assets are not allocated to segment assets. Additionally, all selling, general and administrative expenses are allocated to our segments, with the exception of certain discretionary charges and credits, which we present under “corporate and other.”

Information about certain segment data for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Market Pulp (1)		Tissue		Wood Products (2)		Paper		Segment Total		Corporate and Other		Total
Sales
Second quarter
2021	$	199	$	35	$	664	$	242	$	1,140	$	—	$	1,140
2020	$	161	$	44	$	199	$	208	$	612	$	—	$	612
First six months
2021	$	375	$	77	$	1,094	$	467	$	2,013	$	—	$	2,013
2020	$	338	$	93	$	373	$	497	$	1,301	$	—	$	1,301
Depreciation and amortization
Second quarter
2021	$	6	$	4	$	10	$	16	$	36	$	4	$	40
2020	$	6	$	5	$	10	$	16	$	37	$	3	$	40
First six months
2021	$	12	$	9	$	21	$	31	$	73	$	8	$	81
2020	$	12	$	9	$	21	$	33	$	75	$	7	$	82
Operating income (loss)
Second quarter
2021	$	30	$	(7)	$	405	$	(7)	$	421	$	(15)	$	406
2020	$	10	$	(2)	$	15	$	(12)	$	11	$	(5)	$	6
First six months
2021	$	34	$	(9)	$	626	$	(31)	$	620	$	(37)	$	583
2020	$	7	$	—	$	20	$	(15)	$	12	$	(14)	$	(2)

(1)Inter-segment sales were $8 million and $7 million for the three months ended June 30, 2021 and 2020, and $15 million and $14 million for the six months ended June 30, 2021 and 2020, respectively. These inter-segment sales, which were transacted at either the lowest market price of the previous month or cost, were excluded from market pulp sales.

(2)Wood products sales to our joint ventures, which are transacted at arm’s length negotiated prices, were $20 million and $5 million for the three months ended June 30, 2021 and 2020, respectively, and $33 million and $10 million for the six months ended June 30, 2021 and 2020, respectively.

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Organization and Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Financial statements

Financial statements

Our unaudited interim consolidated financial statements and accompanying notes (or, the “Consolidated Financial Statements”) have been prepared in accordance with the requirements of the U.S. Securities and Exchange Commission (or, the “SEC”) for interim reporting. Under those rules, certain footnotes and other financial information that are normally required by U.S. generally accepted accounting principles (or, “GAAP”) may be condensed or omitted. In our opinion, all adjustments (consisting of normal recurring adjustments) necessary for the fair statement of the Consolidated Financial Statements have been made. All amounts are expressed in U.S. dollars, unless otherwise indicated. The results for the interim period ended June 30, 2021, are not necessarily indicative of the results to be expected for the full year. These Consolidated Financial Statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 1, 2021. Certain prior period amounts in the notes to our Consolidated Financial Statements have been reclassified to conform to the 2021 presentation.

New accounting pronouncements adopted and Accounting pronouncement not yet adopted

New accounting pronouncement adopted in 2021

ASU 2019-12 “Simplifying the Accounting for Income Taxes”

Effective January 1, 2021, we adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes,” issued by the Financial Accounting Standards Board (or, “FASB”) in 2019, which removes the specific exceptions to the general principles in ASC 740, “Income Taxes,” and clarifies certain aspects of the existing guidance. The adoption of this accounting guidance did not impact our Consolidated Financial Statements and disclosures.

Accounting pronouncement not yet adopted as of June 30, 2021

ASU 2020-04 “Reference Rate Reform”

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform,” amended in January by ASU 2021-01, “Reference Rate Reform - Scope,” which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. This update provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform. This update is effective as of March 12, 2020, through December 31, 2022. We are currently evaluating this accounting guidance and have not elected an adoption date. We do not expect this accounting guidance to materially impact our results of operations or financial position.

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Other (Expense) Income, Net (Tables)

6 Months Ended

Jun. 30, 2021

Other Income and Expenses [Abstract]

Schedule of Other (Expense) Income, Net

Other (expense) income, net for the three and six months ended June 30, 2021 and 2020, was comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Foreign exchange (loss) gain	$	(6)	$	(9)	$	(11)	$	14
(Loss) gain on commodity contracts (1)		(49)		—		(86)		4
Insurance recovery (2)		—		15		—		15
Miscellaneous income		6		4		3		5
	$	(49)	$	10	$	(94)	$	38

(1)    Principally related to lumber futures contracts; none of these contracts were outstanding as of June 30, 2021.

(2)    We recorded $15 million as other income for the three and six months ended June 30, 2020, from the settlement of an insurance claim in connection with our acquisition of Atlas Paper Holdings, Inc. (or, “Atlas”) in 2015.

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Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Loss by Component (Net of Tax)

The change in our accumulated other comprehensive loss by component (net of tax) for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2021	$	(2)	$	(1,270)	$	(6)	$	(1,278)
Amounts reclassified from accumulated other comprehensive loss		(2)		15		—		13
Net current period other comprehensive (loss) income		(2)		15		—		13
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)
(Unaudited, in millions)	Unamortized Prior Service Costs		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2020	$	(1)	$	(1,307)	$	(6)	$	(1,314)
Other comprehensive income before reclassifications (1)		—		22		—		22
Amounts reclassified from accumulated other comprehensive loss		(3)		30		—		27
Net current period other comprehensive (loss) income		(3)		52		—		49
Balance as of June 30, 2021	$	(4)	$	(1,255)	$	(6)	$	(1,265)

(1)    The indefinite idling of the Amos and Baie-Comeau (Quebec) mills triggered curtailment and remeasurement of the pension and other postretirement benefit (or, “OPEB”) obligations related to their plans as of March 31, 2021, resulting in a curtailment gain of $8 million and an actuarial gain of $22 million, totaling $30 million ($22 million net of tax).

(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of March 31, 2020	$	1	$	(1,175)	$	(7)	$	(1,181)
Amounts reclassified from accumulated other comprehensive loss		(1)		11		—		10
Net current period other comprehensive (loss) income		(1)		11		—		10
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)
(Unaudited, in millions)	Unamortized Prior Service Credits		Unamortized Actuarial Losses		Foreign Currency Translation		Total
Balance as of December 31, 2019	$	16	$	(1,189)	$	(6)	$	(1,179)
Other comprehensive loss before reclassifications		—		—		(1)		(1)
Amounts reclassified from accumulated other comprehensive loss		(16)		25		—		9
Net current period other comprehensive (loss) income		(16)		25		(1)		8
Balance as of June 30, 2020	$	—	$	(1,164)	$	(7)	$	(1,171)

Schedule of Reclassifications Out of Accumulated Other Comprehensive Loss

The reclassifications out of accumulated other comprehensive loss for the three and six months ended June 30, 2021 and 2020, were comprised of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020		Affected Line in the Consolidated Statements of Operations
Unamortized Prior Service Costs or Credits
Amortization of prior service costs or credits	$	(2)	$	(1)	$	(2)	$	(2)	Non-operating pension and other postretirement benefit credits (1)
Curtailment gain		—		—		(1)		(14)	Non-operating pension and other postretirement benefit credits (1)
		—		—		—		—	Income tax provision
Net of tax		(2)		(1)		(3)		(16)
Unamortized Actuarial Losses
Amortization of actuarial losses		19		15		38		29	Non-operating pension and other postretirement benefit credits (1)
Other items		—		—		—		3
		(4)		(4)		(8)		(7)	Income tax provision
Net of tax		15		11		30		25
Total Reclassifications	$	13	$	10	$	27	$	9

(1)These items are included in the computation of net periodic benefit cost (credit) related to our pension and OPEB plans summarized in Note 9, “Employee Benefit Plans.”

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Net Income Per Share (Tables)

6 Months Ended

Jun. 30, 2021

Earnings Per Share [Abstract]

Schedule of Reconciliation of Basic and Diluted Net Income (Loss) per Share

The reconciliation of the basic and diluted net income per share for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions, except per share amounts)	2021		2020		2021		2020
Numerator:
Net income attributable to Resolute Forest Products Inc.	$	268	$	6	$	355	$	5
Denominator:
Weighted-average number of Resolute Forest Products Inc. common shares outstanding		79.5		88.1		80.4		88.1
Dilutive impact of nonvested stock unit awards and stock options		0.8		0.1		0.7		0.1
Diluted weighted-average number of Resolute Forest Products Inc. common shares outstanding		80.3		88.2		81.1		88.2
Net income per share attributable to Resolute Forest Products Inc. common shareholders:
Basic	$	3.37	$	0.07	$	4.42	$	0.06
Diluted	$	3.34	$	0.07	$	4.39	$	0.06

Schedule of Outstanding Weighted-Average Stock Options and Nonvested Equity-Classified RSUs, DSUs and PSUs

The weighted-average number of outstanding stock options and nonvested equity-classified restricted stock units, deferred stock units and performance stock units (collectively, “stock unit awards”) that were excluded from the calculation of diluted

net income per share, as their impact would have been antidilutive, for the three and six months ended June 30, 2021 and 2020, was as follows:

	Three Months Ended June 30,		Six Months Ended June 30,
(Unaudited, in millions)	2021	2020	2021	2020
Stock options	0.4	0.9	0.5	0.9
Stock unit awards	—	0.9	—	0.9

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Inventories, Net (Tables)

6 Months Ended

Jun. 30, 2021

Inventory Disclosure [Abstract]

Schedule of Inventories, Net

Inventories, net as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Raw materials	$	132	$	132
Work in process		55		46
Finished goods		138		120
Mill stores and other supplies		167		164
	$	492	$	462

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Accounts Payable and Other (Tables)

6 Months Ended

Jun. 30, 2021

Payables and Accruals [Abstract]

Schedule of Accounts Payable and Other

Accounts payable and other as of June 30, 2021 and December 31, 2020, were comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
Trade accounts payable	$	300	$	251
Accrued compensation		69		76
Accrued interest		7		4
Pension and other postretirement benefit obligations		15		14
Special dividend payable (1)		79		—
Accrued provision related to Fibrek Inc. litigation (Note 11)		21		—
Income and other taxes payable		5		5
Other		24		19
	$	520	$	369

(1)    On June 10, 2021, we declared a special dividend of $1.00 per share ($79 million) on our common stock. See Note 12, “Share Capital,” for more information.

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Long-Term Debt (Tables)

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Schedule of Long-Term Debt, including Current Portion

Long-term debt, including current portion, as of June 30, 2021 and December 31, 2020, was comprised of the following:

(Unaudited, in millions)	June 30, 2021		December 31, 2020
4.875% senior unsecured notes due 2026:
Principal amount	$	300	$	—
Deferred financing costs		(6)		—
Total 4.875% senior unsecured notes due 2026		294		—
5.875% senior unsecured notes due 2023:
Principal amount		—		375
Deferred financing costs		—		(2)
Unamortized discount		—		(1)
Total 5.875% senior unsecured notes due 2023		—		372
Senior secured credit facility - Term loans due 2030		—		180
Finance lease obligations		7		9
Other debt		2		—
Total debt		303		561
Less: Current portion of finance lease obligations and other debt		(3)		(2)
Long-term debt, net of current portion	$	300	$	559

Schedule of Debt Redemption Prices

On or after March 1, 2023, we may redeem the notes at our option, in whole at any time or in part from time to time, at redemption prices equal to a percentage of the principal amount plus accrued and unpaid interest, as follows:

Year (beginning March 1)	Redemption Price
2023	102.438	%
2024	101.219	%
2025 and thereafter	100.000	%

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Employee Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2021

Retirement Benefits [Abstract]

Schedule of Components of Net Periodic Benefit Cost Relating to Pension and OPEB Plans

The components of net periodic benefit costs (credits) relating to our pension and OPEB plans for the three and six months ended June 30, 2021 and 2020, were as follows:

Pension Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	34	$	36	$	67	$	74
Expected return on plan assets		(55)		(55)		(109)		(111)
Amortization of actuarial losses		20		17		41		32
Non-operating pension credits		(1)		(2)		(1)		(5)
Service cost		4		3		8		7
Net periodic benefit costs before special events		3		1		7		2
Other (gain) loss		—		—		(1)		3
	$	3	$	1	$	6	$	5

OPEB Plans:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Interest cost	$	1	$	1	$	2	$	2
Amortization of actuarial gains		(1)		(2)		(3)		(3)
Amortization of prior service credits		(2)		(1)		(2)		(2)
Non-operating other postretirement benefit credits		(2)		(2)		(3)		(3)
Service cost		—		1		—		1
Net periodic benefit credits before special events		(2)		(1)		(3)		(2)
Curtailment gain		—		—		—		(14)
	$	(2)	$	(1)	$	(3)	$	(16)

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Schedule of Reconciliation of Statutory Tax Benefit (Provision) to Income Tax Benefit (Provision)

The income tax provision attributable to income before income taxes differs from the amounts computed by applying the U.S. federal statutory income tax rate of 21% for the three and six months ended June 30, 2021 and 2020, as a result of the following:

	Three Months Ended June 30,				Six Months Ended June 30,
(Unaudited, in millions)	2021		2020		2021		2020
Income before income taxes	$	355	$	11	$	483	$	37
Income tax provision:
Expected income tax provision		(74)		(3)		(101)		(8)
Changes resulting from:
Valuation allowance on our U.S. operations		70		(7)		78		(16)
Foreign exchange		1		2		3		(10)
U.S. tax on non-U.S. earnings		(65)		—		(83)		—
State income taxes, net of federal income tax benefit		—		—		2		2
Foreign tax rate differences		(19)		(2)		(27)		(5)
Other, net (1)		—		5		1		5
	$	(87)	$	(5)	$	(127)	$	(32)

(1)    Includes $4 million for the three and six months ended June 30, 2020, related to the settlement of an insurance claim in connection with our acquisition of Atlas.

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

Information about certain segment data for the three and six months ended June 30, 2021 and 2020, was as follows:

(Unaudited, in millions)	Market Pulp (1)		Tissue		Wood Products (2)		Paper		Segment Total		Corporate and Other		Total
Sales
Second quarter
2021	$	199	$	35	$	664	$	242	$	1,140	$	—	$	1,140
2020	$	161	$	44	$	199	$	208	$	612	$	—	$	612
First six months
2021	$	375	$	77	$	1,094	$	467	$	2,013	$	—	$	2,013
2020	$	338	$	93	$	373	$	497	$	1,301	$	—	$	1,301
Depreciation and amortization
Second quarter
2021	$	6	$	4	$	10	$	16	$	36	$	4	$	40
2020	$	6	$	5	$	10	$	16	$	37	$	3	$	40
First six months
2021	$	12	$	9	$	21	$	31	$	73	$	8	$	81
2020	$	12	$	9	$	21	$	33	$	75	$	7	$	82
Operating income (loss)
Second quarter
2021	$	30	$	(7)	$	405	$	(7)	$	421	$	(15)	$	406
2020	$	10	$	(2)	$	15	$	(12)	$	11	$	(5)	$	6
First six months
2021	$	34	$	(9)	$	626	$	(31)	$	620	$	(37)	$	583
2020	$	7	$	—	$	20	$	(15)	$	12	$	(14)	$	(2)

(1)Inter-segment sales were $8 million and $7 million for the three months ended June 30, 2021 and 2020, and $15 million and $14 million for the six months ended June 30, 2021 and 2020, respectively. These inter-segment sales, which were transacted at either the lowest market price of the previous month or cost, were excluded from market pulp sales.

(2)Wood products sales to our joint ventures, which are transacted at arm’s length negotiated prices, were $20 million and $5 million for the three months ended June 30, 2021 and 2020, respectively, and $33 million and $10 million for the six months ended June 30, 2021 and 2020, respectively.

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Organization and Basis of Presentation - Narrative (Details)	Jun. 30, 2021 country site
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of countries products are marketed in (approximate) | country	50
Number of manufacturing facilities (approximate) | site	40

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Other (Expense) Income, Net - Summary (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Other Income and Expenses [Abstract]
Foreign exchange (loss) gain	$ (6)	$ (9)	$ (11)	$ 14
(Loss) gain on commodity contracts	(49)	0	(86)	4
Insurance recovery	0	15	0	15
Miscellaneous income	6	4	3	5
Other (expense) income, net	$ (49)	10	$ (94)	38
Accrued legal costs		$ 15		$ 15

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Accumulated Other Comprehensive Loss - Accumulated Other Comprehensive Loss by Component (Net of Tax) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at beginning of period	$ 1,187	$ 1,234	$ 1,082	$ 1,235
Other comprehensive income before reclassifications			22	(1)
Amounts reclassified from accumulated other comprehensive loss	13	10	27	9
Net current period other comprehensive (loss) income	13	10	49	8
Balance at end of period	1,387	1,250	1,387	1,250
Curtailment gain	8
Curtailment and actuarial gain, before tax	30
Curtailment and actuarial gain, net of tax	22
Total
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at beginning of period	(1,278)	(1,181)	(1,314)	(1,179)
Balance at end of period	(1,265)	(1,171)	(1,265)	(1,171)
Unamortized Prior Service Costs
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at beginning of period	(2)	1	(1)	16
Other comprehensive income before reclassifications			0	0
Amounts reclassified from accumulated other comprehensive loss	(2)	(1)	(3)	(16)
Net current period other comprehensive (loss) income	(2)	(1)	(3)	(16)
Balance at end of period	(4)	0	(4)	0
Unamortized Actuarial Losses
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at beginning of period	(1,270)	(1,175)	(1,307)	(1,189)
Other comprehensive income before reclassifications			22	0
Amounts reclassified from accumulated other comprehensive loss	15	11	30	25
Net current period other comprehensive (loss) income	15	11	52	25
Balance at end of period	(1,255)	(1,164)	(1,255)	(1,164)
Actuarial gain	22
Foreign Currency Translation
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at beginning of period	(6)	(7)	(6)	(6)
Other comprehensive income before reclassifications			0	(1)
Amounts reclassified from accumulated other comprehensive loss	0	0	0	0
Net current period other comprehensive (loss) income	0	0	0	(1)
Balance at end of period	$ (6)	$ (7)	$ (6)	$ (7)

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Accumulated Other Comprehensive Loss - Reclassifications Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items]
Curtailment gain	$ (8)
Income tax provision	(87)	$ (5)	$ (127)	$ (32)
Total reclassification, net of tax	268	6	355	5
Amounts Reclassified from Accumulated Other Comprehensive Loss
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items]
Total reclassification, net of tax	13	10	27	9
Unamortized Prior Service Costs | Amounts Reclassified from Accumulated Other Comprehensive Loss
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items]
Amortization of prior service costs or credits	(2)	(1)	(2)	(2)
Curtailment gain	0	0	(1)	(14)
Income tax provision	0	0	0	0
Total reclassification, net of tax	(2)	(1)	(3)	(16)
Unamortized Actuarial Losses | Amounts Reclassified from Accumulated Other Comprehensive Loss
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items]
Amortization of actuarial losses	(19)	(15)	(38)	(29)
Other items	0	0	0	3
Income tax provision	(4)	(4)	(8)	(7)
Total reclassification, net of tax	$ 15	$ 11	$ 30	$ 25

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Net Income Per Share - Schedule of Weighted-Average Outstanding Stock Options and Nonvested Equity-Classified RSUs, DSUs and PSUs (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Earnings Per Share [Abstract]
Net income attributable to Resolute Forest Products Inc.	$ 268	$ 6	$ 355	$ 5
Basic weighted-average number of Resolute Forest Products Inc. common shares outstanding (shares)	79.5	88.1	80.4	88.1
Dilutive impact of nonvested stock unit awards and stock options (shares)	0.8	0.1	0.7	0.1
Diluted weighted-average number of Resolute Forest Products Inc. common shares outstanding (shares)	80.3	88.2	81.1	88.2
Basic (USD per share)	$ 3.37	$ 0.07	$ 4.42	$ 0.06
Diluted (USD per share)	$ 3.34	$ 0.07	$ 4.39	$ 0.06
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	0.4	0.9	0.5	0.9
Stock unit awards
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (shares)	0.0	0.9	0.0	0.9

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Inventories, Net - Summary (Details) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Raw materials	$ 132	$ 132
Work in process	55	46
Finished goods	138	120
Mill stores and other supplies	167	164
Inventories, net	$ 492	$ 462

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Other Assets - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2021	Dec. 31, 2020
Other Assets [Abstract]
Accumulated countervailing cash deposits made on softwood lumber exports	$ 278	$ 194
Accumulated anti-dumping cash deposits made on softwood lumber exports	$ 54	$ 49

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Accounts Payable and Other - Summary (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended		6 Months Ended
	Jun. 10, 2021	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Payables and Accruals [Abstract]
Trade accounts payable		$ 300		$ 300		$ 251
Accrued compensation		69		69		76
Accrued interest		7		7		4
Pension and other postretirement benefit obligations		15		15		14
Special dividend payable		79		79		0
Accrued provision related to Fibrek Inc. litigation (Note 11)		21		21		0
Income and other taxes payable		5		5		5
Other		24		24		19
Accounts payable and accrued liabilities		520		520		$ 369
Common stock, dividends declared (USD per share)	$ 1.00
Common stock, dividends paid	$ 79	$ 79	$ 0	$ 79	$ 0

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Long-Term Debt - Long Term Debt, including Current Portion (Details) - USD ($) $ in Millions	Jun. 30, 2021	Feb. 02, 2021	Dec. 31, 2020	May 08, 2013
Debt Instrument [Line Items]
Finance lease obligations	$ 7		$ 9
Other debt	2		0
Total debt	303		561
Less: Current portion of finance lease obligations and other debt	(3)		(2)
Long-term debt, net of current portion	300		559
Senior Notes | Senior Notes due 2026
Debt Instrument [Line Items]
Principal amount	300		0
Deferred financing costs	(6)		0
Net carrying amount	294		0
Interest rate of notes (as a percent)		4.875%
Senior Notes | Senior Notes due 2023
Debt Instrument [Line Items]
Principal amount	0		375
Deferred financing costs	0		(2)
Unamortized discount	0		(1)
Net carrying amount	0		372
Interest rate of notes (as a percent)				5.875%
Secured Debt | Term Loans due 2030
Debt Instrument [Line Items]
Net carrying amount	$ 0		$ 180

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Long-Term Debt - Senior Unsecured Notes (Details) - Senior Notes - USD ($)		6 Months Ended
	Feb. 02, 2021	Jun. 30, 2021	Dec. 31, 2020	Jan. 03, 2019	May 08, 2013
Senior Notes due 2026
Debt Instrument [Line Items]
Principal amount of debt	$ 300,000,000
Interest rate of notes (as a percent)	4.875%
Issue price (as a percent)	100.00%
Fair value of senior notes	$ 300,000,000	$ 311,000,000
Deferred financing costs	$ 6,000,000
Redemption price (as a percent)		101.00%
Senior Notes due 2023
Debt Instrument [Line Items]
Principal amount of debt					$ 600,000,000
Interest rate of notes (as a percent)					5.875%
Fair value of senior notes		$ 375,000,000	$ 375,000,000		$ 594,000,000
Deferred financing costs					9,000,000
Redemption price (as a percent)	100.00%
Unamortized discount					$ 6,000,000
Effective interest rate of debt (as a percent)					6.00%
Debt Instrument, repurchased face amount				$ 225,000,000
Purchase price to principal amount (as a percent)				100.00%
Loss on extinguishment of debt		$ 3,000,000

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Long-Term Debt - Redemption Price (Details) - Senior Notes - Senior Notes due 2026	6 Months Ended
	Jun. 30, 2021
Debt Instrument [Line Items]
Redemption price (as a percent)	101.00%
2023
Debt Instrument [Line Items]
Redemption price (as a percent)	102.438%
2024
Debt Instrument [Line Items]
Redemption price (as a percent)	101.219%
2025 and thereafter
Debt Instrument [Line Items]
Redemption price (as a percent)	100.00%

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Long-Term Debt - Senior Secured Credit Facility (Details) - USD ($)				12 Months Ended
	Apr. 19, 2021	Mar. 02, 2020	Oct. 28, 2019	Dec. 31, 2020	Jun. 30, 2021	Sep. 07, 2016
Senior Secured Credit Facility
Debt Instrument [Line Items]
Principal amount of debt			$ 360,000,000			$ 185,000,000
Senior Secured Credit Facility | Secured Debt
Debt Instrument [Line Items]
Principal amount of debt			180,000,000			46,000,000
Repayment of debt			46,000,000
Available credit facility borrowing capacity					$ 180,000,000
Senior Secured Credit Facility | Secured Debt | Term Loan Facility
Debt Instrument [Line Items]
Principal amount of debt		$ 180,000,000
Debt instrument, term		10 years
Senior Secured Credit Facility | Line of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity of credit facility			$ 180,000,000			$ 139,000,000
Available credit facility borrowing capacity					$ 180,000,000
Senior Secured Credit Facility | Line of Credit | LIBOR
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)				2.13%
Amended Senior Secured Credit Facility
Debt Instrument [Line Items]
Principal amount of debt	$ 360,000,000
Amended Senior Secured Credit Facility | Secured Debt
Debt Instrument [Line Items]
Principal amount of debt	$ 180,000,000
Delay draw period of debt instrument	3 years
Amended Senior Secured Credit Facility | Secured Debt | Term Loan Facility
Debt Instrument [Line Items]
Repayment of debt	$ 180,000,000
Amended Senior Secured Credit Facility | Secured Debt | Minimum
Debt Instrument [Line Items]
Debt instrument, term	6 years
Interest rate for fixed rate loans (as a percent)	1.70%
Amended Senior Secured Credit Facility | Secured Debt | Maximum
Debt Instrument [Line Items]
Debt instrument, term	10 years
Interest rate for fixed rate loans (as a percent)	2.10%
Amended Senior Secured Credit Facility | Secured Debt | LIBOR | Minimum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	1.50%
Amended Senior Secured Credit Facility | Secured Debt | LIBOR | Maximum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	2.40%
Amended Senior Secured Credit Facility | Secured Debt | Base Rate | Minimum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	0.50%
Amended Senior Secured Credit Facility | Secured Debt | Base Rate | Maximum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	1.40%
Amended Senior Secured Credit Facility | Line of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity of credit facility	$ 180,000,000
Debt instrument, term	6 years
Uncommitted ability to increase borrowing capacity, maximum	$ 360,000,000
Amended Senior Secured Credit Facility | Line of Credit | LIBOR | Minimum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	1.50%
Amended Senior Secured Credit Facility | Line of Credit | LIBOR | Maximum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	2.00%
Amended Senior Secured Credit Facility | Line of Credit | Base Rate | Minimum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	0.50%
Amended Senior Secured Credit Facility | Line of Credit | Base Rate | Maximum
Debt Instrument [Line Items]
Interest rate margin applicable to borrowings (as a percent)	1.00%

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Long-Term Debt - ABL Credit Facility (Details) - Revolving Credit Facility - USD ($)	Jan. 21, 2021	Jun. 30, 2021	May 14, 2019
Line of Credit Facility [Line Items]
Maximum borrowing capacity of credit facility	$ 450,000,000		$ 500,000,000
Available credit facility borrowing capacity		$ 336,000,000
Letters of credit amount outstanding		$ 67,000,000
Canadian Tranche of Senior Secured Asset-Based Revolving Credit Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity of credit facility	250,000,000
Increase (decrease) in borrowings	$ 50,000,000

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Long-Term Debt - Loan Facility (Details) - Loan Facility	Nov. 04, 2020 CAD ($) draw	Jun. 30, 2021 USD ($)	Jun. 30, 2021 CAD ($)
Line of Credit Facility [Line Items]
Maximum borrowing capacity of credit facility	$ 220,000,000	$ 177,000,000
Maximum borrowing capacity, proportion representing countervailing and anti-dumping duty deposits (as a percent)	75.00%
Period of repayment in consecutive monthly installments	8 years
Interest-only payment period	2 years
Number of draws available	10
Available credit facility borrowing capacity		$ 177,000,000	$ 220,000,000
Canadian Banker's Acceptance Rate
Line of Credit Facility [Line Items]
Interest rate margin applicable to borrowings (as a percent)	1.45%

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Employee Benefit Plans - Components of Net Periodic Benefit Cost Relating to Pension and OPEB Plans (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Defined Benefit Plan Disclosure [Line Items]
Non-operating pension and other postretirement benefit costs (credits)	$ (3)	$ (4)	$ (5)	$ (19)
Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Interest cost	34	36	67	74
Expected return on plan assets	(55)	(55)	(109)	(111)
Amortization of actuarial (gains) losses	20	17	41	32
Non-operating pension and other postretirement benefit costs (credits)	(1)	(2)	(1)	(5)
Service cost	4	3	8	7
Net periodic benefit costs (credits) before special events	3	1	7	2
Other (gain) loss and curtailment gain	0	0	(1)	3
Net periodic benefit cost	3	1	6	5
OPEB Plans
Defined Benefit Plan Disclosure [Line Items]
Interest cost	1	1	2	2
Amortization of actuarial (gains) losses	(1)	(2)	(3)	(3)
Amortization of prior service credits	(2)	(1)	(2)	(2)
Non-operating pension and other postretirement benefit costs (credits)	(2)	(2)	(3)	(3)
Service cost	0	1	0	1
Net periodic benefit costs (credits) before special events	(2)	(1)	(3)	(2)
Other (gain) loss and curtailment gain	0	0	0	(14)
Net periodic benefit cost	$ (2)	$ (1)	$ (3)	$ (16)

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Employee Benefit Plans - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Retirement Benefits [Abstract]
Expense for the defined contribution plans	$ 4	$ 4	$ 9	$ 8
Reduction in estimated contributions due to the Act	$ (13)		$ (13)

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Income Taxes - Reconciliation of Statutory Tax Benefit (Provision) to Income Tax Benefit (Provision) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Income Tax Disclosure [Abstract]
Income before income taxes	$ 355	$ 11	$ 483	$ 37
Income tax provision:
Expected income tax provision	(74)	(3)	(101)	(8)
Changes resulting from:
Valuation allowance on our U.S. operations	70	(7)	78	(16)
Foreign exchange	1	2	3	(10)
U.S. tax on non-U.S. earnings	(65)	0	(83)	0
State income taxes, net of federal income tax benefit	0	0	2	2
Foreign tax rate differences	(19)	(2)	(27)	(5)
Other, net	0	5	1	5
Income tax provision	(87)	(5)	(127)	(32)
Effective income tax rate reconciliation nondeductible expense insurance recovery amount		$ 4		$ 4
Deferred income tax assets used	$ 70		$ 78

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Commitments and Contingencies - Narrative (Details) $ / shares in Units, $ in Millions, $ in Millions			6 Months Ended
	May 20, 2021	Apr. 28, 2017	Jun. 30, 2021 USD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2021 CAD ($) $ / shares	Dec. 31, 2020 USD ($)	Dec. 31, 2020 CAD ($)	Dec. 01, 2020	Nov. 30, 2020	Nov. 13, 2019 CAD ($)	Nov. 02, 2017	Jun. 30, 2017	Jul. 31, 2012
Loss Contingencies [Line Items]
Preliminary countervailing duty rate on certain Canadian softwood lumber imported to the U.S. market (as a percent)	18.17%	12.82%
Final determination countervailing duty rate on certain Canadian softwood lumber imported to the U.S. market (as a percent)								19.10%			14.70%
Additional countervailing cash deposits made on softwood lumber exports			$ 84
Accumulated countervailing cash deposits made on softwood lumber exports			278			$ 194
Preliminary anti-dumping rate on certain Canadian softwood lumber imported to the U.S. market (as a percent)												4.59%
Final determination anti-dumping rate on certain Canadian softwood lumber imported to the U.S. market (as a percent)	12.05%								1.15%		3.20%
Additional anti-dumping cash deposits made on softwood lumber exports			5
Accumulated anti-dumping cash deposits made on softwood lumber exports			54			49
Other liabilities			77			92
Legal hypothec on immovable and movable property										$ 30
Maximum deficit from partial wind-up of pension plans to be funded			121	$ 150
Environmental liabilities			13			15
Asset retirement obligations			27			25
Fibrek
Loss Contingencies [Line Items]
Proportion of outstanding shares acquired (as a percent)													25.40%
Determined per share fair value of dissenting shareholders' shares | $ / shares					$ 1.99
Determined fair value of dissenting shareholders' shares					$ 31
Determined fair value of dissenting shareholders' shares including interest and indemnity					44
Amount accrued to be contingently distributed							$ 14
Change in amount of contingent consideration			23	$ 30
Amount paid, contingent consideration, business combination			14		19
Softwood Lumber Duties Investigations
Loss Contingencies [Line Items]
Contingent loss recorded			0
Fibrek
Loss Contingencies [Line Items]
Other liabilities			$ 21		$ 27	$ 20	$ 26

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Share Capital - Narrative (Details) - USD ($)		3 Months Ended		6 Months Ended
	Jun. 10, 2021	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Mar. 02, 2020
Dividends Payable [Line Items]
Share repurchase program, authorized maximum percentage of common stock to be repurchased (as a percent)						15.00%
Share repurchase program, authorized amount						$ 100,000,000
Share repurchase program, stock repurchased (shares)		343,894	253,898	2,092,348	253,898
Average price of treasury stock acquired (USD per share)		$ 11.21	$ 2.09	$ 9.78	$ 2.09
Share repurchase program, aggregate purchase price		$ 3,000,000	$ 1,000,000	$ 20,000,000	$ 1,000,000
Common stock, dividends declared (USD per share)	$ 1.00
Common stock, dividends paid	$ 79,000,000	79,000,000	$ 0	79,000,000	$ 0
Dividend Declared
Dividends Payable [Line Items]
Stock-based compensation expense		3,000,000		3,000,000
Increase in deficit		2,000,000		2,000,000
Increase in additional paid-in capital		2,000,000		2,000,000
Increase in liabilities		$ 3,000,000		$ 3,000,000

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Segment Information - Segment Reporting Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Segment Reporting Information [Line Items]
Sales	$ 1,140	$ 612	$ 2,013	$ 1,301
Depreciation and amortization	40	40	81	82
Operating income (loss)	406	6	583	(2)
Operating segments | Market Pulp
Segment Reporting Information [Line Items]
Sales	199	161	375	338
Depreciation and amortization	6	6	12	12
Operating income (loss)	30	10	34	7
Operating segments | Tissue
Segment Reporting Information [Line Items]
Sales	35	44	77	93
Depreciation and amortization	4	5	9	9
Operating income (loss)	(7)	(2)	(9)	0
Operating segments | Wood Products
Segment Reporting Information [Line Items]
Sales	664	199	1,094	373
Depreciation and amortization	10	10	21	21
Operating income (loss)	405	15	626	20
Joint venture sales	20	5	33	10
Operating segments | Paper
Segment Reporting Information [Line Items]
Sales	242	208	467	497
Depreciation and amortization	16	16	31	33
Operating income (loss)	(7)	(12)	(31)	(15)
Operating segments | Segment Total
Segment Reporting Information [Line Items]
Sales	1,140	612	2,013	1,301
Depreciation and amortization	36	37	73	75
Operating income (loss)	421	11	620	12
Corporate and Other | Corporate and Other
Segment Reporting Information [Line Items]
Sales	0	0	0	0
Depreciation and amortization	4	3	8	7
Operating income (loss)	(15)	(5)	(37)	(14)
Intersegment eliminations | Market Pulp
Segment Reporting Information [Line Items]
Sales	$ 8	$ 7	$ 15	$ 14