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ABITIBI-PRICE RECORDS LOSS OF $219 MILLION, AS CONTINUED OVERSUPPLY ERODES PAPER PRICES IN 1992

 TORONTO, Feb. 15 /PRNewswire/ -- Abitibi-Price, Inc. (NYSE: ABY), announced today due to severe price erosion, caused by continued oversupply of the company's paper products, contributed significantly to the 1992 loss from continuing operations of $200 million or $2.91 per common share. This compares with a loss of $58 million or $0.86 per share in 1991. Sales from continuing operations for 1992 were improved marginally to $1.7 billion, despite an almost 10 per cent increase in tonnes sold. Included in the loss from continuing operations, unusual charges in 1992 totalled $67 million, $60 million of which related to the permanent closure of the Thunder Bay newsprint mill.
 In the third quarter of 1992, the company reclassified a number of its non-core assets as discontinued. The operating loss and the loss on disposal of these discontinued businesses, when combined with the loss from continuing operations, resulted in an 1992 after-tax loss of $219 million or $3.19 per common share compared with an after-tax loss of $76 million or $1.12 per share in 1991.
 The company generated cash of $175 million, as proceeds from the sale of non-strategic assets and positive changes in working capital more than compensated for operating losses. A healthy balance sheet was maintained with debt to total capitalization ratio reduced further to 25 per cent.
 In the fourth quarter of 1992, a reduction in the oversupply and a decrease in discounts in the company's North American newsprint business were offset by continuing depressed prices for uncoated groundwood specialty products and softer offshore newsprint markets. A substantial boost in the company's investment in training, along with the translation of U.S. selling expenses at a lower value of the Canadian dollar, contributed to the loss from continuing operations for the quarter of $41 million on sales of $444 million compared to an operating loss of $30 million on sales of $380 million in the same period in 1991.
 Ron Oberlander, president of Abitibi-Price, said, ``We are encouraged by the turnaround for newsprint in the United States, where consumption increased by 2 per cent in 1992 compared to 1991 -- the first year over year increase since 1988. We expect this market to continue to improve in 1993 with an anticipated rise of 2-3 per cent in Canadian operating rates and a further price increase planned for March 1.''
 Sales and profitability from the company's offshore newsprint markets will continue to be hampered by regional oversupply and European currency devaluations.
 Despite increased sales volumes, the company's specialty groundwood paper operations continue to be plagued by a serious deterioration in prices due to overcapacity both in North America and Europe. Aggressive cost reduction programs and improvements to customer satisfaction continue in an increasingly competitive market. The company expects stronger markets towards the end of 1993.
 The sales and operating profit of the Office Products division exceeded 1991 results. In the Converted Products division, downward pressure on volume and selling prices resulted in operating losses for 1992. Both divisions are expected to be profitable in 1993 because of anticipated improvement in business conditions and operating efficiencies.
 Oberlander, in looking forward to 1993, added, ``This will be a pivotal year for Abitibi-Price as we continue to focus our resources on our core business -- the manufacture and marketing of groundwood papers. To become the finest we must deliver high-quality products and service at the lowest cost -- for the benefit of all our stakeholders.''
 Abitibi-Price, a major competitor in the global forest products industry, is a manufacturer and marketer of newsprint and uncoated groundwood papers. The company is a prominent distributor of office and information-processing products, as well as a converter of industrial goods and products for home, school and office use.
 SYMBOLS: A (Toronto, Montreal and Vancouver stock exchanges)
 ABY (New York Stock Exchange)
 ABITIBI-PRICE INC.
 CONSOLIDATED EARNINGS
 (unaudited)
 December 31
 (millions of
 Canadian dollars) 1992 1991 1992 1991
 Net sales $ 443.8 $ 379.7 $1,674.9 $1,654.8
 Cost of sales 430.0 363.2 1,627.0 1,482.7
 Selling and
 administrative
 expenses 33.8 23.3 105.6 102.3
 Depreciation and
 depletion 21.4 23.5 90.5 93.8
 485.2 410.0 1,823.1 1,678.8
 Operating loss
 from continuing
 operations (41.4) (30.3) (148.2) (24.0)
 Loss from newsprint
 joint ventures,
 before income taxes (15.0) (8.2) (49.7) (1.5)
 Interest expense
 - long-term (9.1) (8.4) (29.5) (29.0)
 - short-term (0.1) (1.8) (3.4) (7.2)
 Unusual items (5.7) (19.5) (66.9) (39.5)
 Other income
 and expense (1.7) 0.3 (11.5) 5.7
 Loss from
 continuing
 operations
 before income
 taxes (73.0) (67.9) (309.2) (95.5)
 Recovery of income
 taxes 21.8 26.5 109.3 37.8
 Loss from continuing
 operations (51.2) (41.4) (199.9) (57.7)
 Discontinued operations -
 Loss from
 discontinued
 operations, net of
 income tax (provision)
 recoveries of
 $(0.4), $8.9, $8.2 and
 $15.8, respectively (0.2) (6.7) (13.4) (18.2)
 Loss on disposal of
 discontinued
 operations, net of
 income tax
 recoveries of
 $5.7 and $28.1 (16.3) - (6.0) -
 Loss from
 discontinued
 operations (16.5) (6.7) (19.4) (18.2)
 Loss for the year (67.7) (48.1) (219.3) (75.9)
 Provision for
 dividends on
 preferred shares (0.4) (0.4) (1.6) (1.7)
 Loss attributable
 to common
 shareholders $ (68.1) $ (48.5) $ (220.9) $ (77.6)
 Per Common Share:
 Loss from
 continuing
 operations $ (0.75) $ (0.61) $ (2.91) $ (0.86)
 Loss (0.99) (0.70) (3.19) (1.12)
 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- 2/15/93
 /CONTACT: EilAeen A. Mercier, senior vice-president, finance, 416-369-6718 or Robert J. Tait, 416-369-6789, both for Abiti-Price/
 (ABY)


CO: Abitibi-Price Inc. ST: Ontario IN: PAP SU: ERN

JP -- NY034 -- 6605 02/15/93 16:43 EST
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Publication:PR Newswire
Date:Feb 15, 1993
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