<B>Fort James Reports Quarterly Figures</B>

Fort James Corp. announced first quarter 2000 net earnings of $96.4 million. This compares to net earnings before unusual and non-recurring items of $117.6 million reported in the first quarter of 1999. Net sales for the first quarter increased modestly to $1,676.6 million vs $1,669.0 million in 1999. Excluding the effects of currency translation and divested operations, net sales increased 4 percent.

Income from operations declined to $187.2 million in the first quarter of 2000 from $236.4 million in 1999. The decline was principally attributable to reduced earnings in the Tissue - North America and Tissue - Europe businesses, driven by escalating costs in key raw materials, partially offset by increased earnings in the Communications Papers and Fiber businesses.

Sales for the Tissue - North America business increased 2 percent in the first quarter of 2000 to $913.2 million compared to $899.4 million a year ago. Despite the increase in sales, first quarter 2000 income from operations declined to $144.1 million, compared to $192.1 million in 1999.

"As we had anticipated, inflationary pressures in raw material costs affected our first-quarter results," said Miles L. Marsh, chairman and CEO of Fort James. "However, there are reasons to be encouraged. Sales and volumes were strong, indicating continued consumer confidence in our product line. Price increases on many of our products began to take effect during the first quarter, and we have announced additional price increases that are scheduled to take effect during the second quarter. We also are making progress toward resolving the distribution issues that affected our performance last year, and our cost reduction initiatives continue to show results.

"At the same time, our strategic decisions to sell the Marathon pulp mill and close the company's groundwood paper business decrease the company's exposure to commodity paper products and allow us to focus more closely on our core consumer businesses. Finally, current market conditions have allowed us to accelerate our stock purchase program. We continue to believe that results will improve as the year continues."