Printer Friendly

ABITIBI-PRICE MAINTAINS ITS BALANCE SHEET AND CASH FLOW IN A TOUGH YEAR

ABITIBI-PRICE MAINTAINS ITS BALANCE SHEET AND CASH FLOW IN A TOUGH YEAR
 TORONTO, Feb. 18 /PRNewswire/ -- Despite very soft markets and severe pricing pressures in 1991, Abitibi-Price maintained a healthy balance sheet and increased its cash position by $100 million. Cash flow was positively affected by the sale of non-strategic assets and a serious commitment to cost reductions and operating efficiencies. The debt to total capitalization ratio at December 31, 1991 was maintained at a low 30 percent.
 In 1991, the company reported a loss of $75.9 million or $1.12 per common share compared with a loss of $50.4 million or $0.76 per share in 1990 following a $5.8 million prior period adjustment. Sales for 1991 declined to $2.8 billion from $3.1 billion the previous year.
 Unusual charges in 1991 totalled $44.4 million reflecting restructuring and downsizing costs throughout the company. Almost half of these charges related to the closure of a small paper coating operation in Georgetown, Ontario, and the idling of a newsprint mill in Thunder Bay, Ontario. Unusual charges in 1990 were $54.1 million.
 The recession reduced consumption and continued oversupply depressed pricing for many of our products in the fourth quarter. Sales in that quarter were $652.1 million compared to $743.3 million in the same period in 1990. Unusual charges of $24.4 million taken in the fourth quarter resulted in a loss of $48.1 million or $0.70 per share compared with a 1990 loss $34.7 million or $0.51 per share.
 In its newsprint operations, the company achieved substantial operating improvements, basically bringing costs into line with reductions in production volume. However, as new mills across the industry became fully productive, and insufficient capacity was retired to offset this new production, prices declined.
 Newsprint markets will remain poor In 1992, resulting in a need for further reduction in manufacturing costs.
 Our groundwood operations also experienced pricing pressures in 1991. However, demand was firm at the higher end of our product range, and these machines ran at or near full capacity. The Alma, Quebec, directory papers mill moved quickly to meet the recycling requirements set by the Yellow Pages Publishers Association calling for 10 percent recycled content by the end of 1992.
 The distribution companies within the Diversified Group continued to be profitable during 1991 despite the tough economy. In the office products and Industrial products divisions, new marketing strategies improved profitability, a trend which we expect to continue in 1992.
 The building products group suffered a small loss in 1991, as a result of severely depressed conditions in the U.S. housing market.
 The operating loss at Provincial Papers, our coated papers operation, offset the slight operating profit earned by the rest of the company. Very soft markets have depressed prices and have hurt the excellent turnaround effort by the employees, who are producing consistently high-quality paper and finding cost reductions. The turnaround of Provincial remains one of our top priorities.
 Our outlook for 1992 is for another difficult year, but we recognize that our healthy balance sheet and our commitment to ongoing cost improvements will position us for recovery when the economy improves.
 Abitibi-Price, a world-class competitor in the forest industry, is a producer of newsprint, uncoated groundwood papers, coated papers and building products. The company is a major converter and distributor of paper and other information-related products.
 ABITIBI-PRICE,
 Consolidated Earnings
 (Unaudited, in millions of Canadian dollars)
 Periods ended: Three months Year Ended
 Dec. 31: 1991 1990 1991 1990
 Net Sales $ 652.1 $ 743.3 $ 2,800.5 $ 3,088.0
 Cost of sales 607.2 682.0 2,493.6 2,684.5
 Selling and
 administrative
 expenses 49.8 68.0 233.7 264.0
 Depreciation
 and depletion 28.3 28.2 113.1 113.3
 Total 685.3 778.2 2,840.4 3,061.8
 Operating profit
 (loss) (33.2) (34.9) (39.9) 26.2
 Income (loss) from
 newsprint joint ventures,
 before income
 taxes (8.2) (2.8) (1.5) (9.4)
 Interest expense
 - long-term (9.0) (8.2) (35.0) (34.2)
 short-term (2.7) (5.2) (12.7) (21.6)
 Unusual items (24.4) (11.5) (44.4) (54.1)
 Other income and
 expense - net (6.1) 4.1 4.0 13.8
 Total (83.6) (58.5) (129.5) (79.3)
 Income taxes 35.5 23.8 53.6 28.9
 Loss for the year (48.1) (34.7) (75.9) (50.4)
 Provision for dividends
 on preferred shares (0.4) (0.5) (1.7) (2.2)
 Loss attributable to
 common
 shareholders $ (48.5) $ (35.2) $ (77.6) $ (52.6)
 Per common share:
 Loss $ (0.70) $ (0.51) $ (1.12) $ (0.76)
 Dividends
 declared $ 0.125 $ 0.125 $ 0.50 $ 0.50
 Weighted average
 number of common
 shares outstanding
 (millions) 69.3 69.3 69.3 69.3
 -0- 2/18/92
 /CONTACT: Robert G. Lawrie, senior vice president, counsel- compliance and communication, 416-369-6761; or Eileen Mercier, senior vice president and chief financial officer, 416-369-6718, or Robert J. Tait, manager-investor relations, 416-369-6789, all of Abitibi-Price/
 (ABY) CO: Abitibi-Price ST: IN: PAP SU: ERN


TS -- NY003 -- 9702 02/18/92 06:27 EST
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Feb 18, 1992
Words:869
Previous Article:USS/KOBE STEEL COMPANY BOARD APPROVES MULTI-MILLION DOLLAR MODERNIZATION PROJECT
Next Article:LARGE TYPE CATALOG OF COMFORTING PRODUCTS AND HELPFUL GADGETS AVAILABLE FROM COMFORT HOUSE
Topics:


Related Articles
ABITIBI-PRICE MAINTAINS ITS BALANCE SHEET AND CASH FLOW IN A TOUGH YEAR
Abitibi-Price Reports Stronger Outlook Despite First Quarter Loss
Abitibi-Consolidated Reports Earnings of $9 Million from Continuing Operations, Before Restructuring and Unusual Items.
ABITIBI-CONSOLIDATED REPORTS NET LOSS OF $35 MILLION; CONTINUES TO LOWER COSTS AND STRENGTHEN POSITION.
ABITIBI-CONSOLIDATED REPORTS THIRD QUARTER NET LOSS OF $37 MILLION; CONTINUES TO LOWER COSTS AND BALANCE SUPPLY.
ABITIBI-CONSOLIDATED REPORTS A NET LOSS OF $5 MILLION IN THE FOURTH QUARTER - AN IMPROVEMENT OF $32 MILLION OVER THIRD QUARTER.
Abitibi-Consolidated Cost Reductions Contribute to After-Tax Earnings of $6 Million in the First Quarter.
Abitibi-Consolidated Earnings up 20%; Donohue Acquisition Immediately Accretive.
Abitibi-Consolidated Third Quarter Earnings Up 77% to $108 Million.
Abitibi-Consolidated earns $147 Million in the fourth quarter and $367 million for the year.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters