Brascade Announces 2003 Second Quarter Results.Business Editors TORONTO--(BUSINESS WIRE)--Aug. 13, 2003 Brascade Resources Inc. today reported a net loss of $23.4 million for the six months ended June June: see month. 30, 2003, compared to net income of $17.3 million in the same period in 2002. Operations Mining and metal operations lost $27.2 million in the first half of 2003, down from a contribution of $9.6 million in the same period in 2002. This reflected an additional restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. related to Noranda's magnesium magnesium (măgnē`zēəm, –zhəm), metallic chemical element; symbol Mg; at. no. 12; at. wt. 24.305; m.p. about 648.8°C;; b.p. about 1,090°C;; sp. gr. 1.738 at 20°C;; valence +2. business in the first quarter, as well as the impact of higher energy prices, the stronger Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents and the labour strike at the Horne Horne , Lena Born 1917. American singer and actress. She has performed in Broadway musicals, television productions, and films, including Stormy Weather (1943). Noun 1. smelter which was settled in early May. In July July: see month. , Noranda Noranda: see Rouyn-Noranda, Que., Canada. announced a recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. plan that includes the issuance of up to $600 million common shares, reduction of the quarterly dividend from $0.20 to $0.12, conversion to US dollar reporting and the issuance of US$300 million of debt. Forest product operations broke even in the first half of 2003, down from a contribution of $4.3 million in the same period last year due mainly to a restructuring charge during the second quarter at Nexfor's pulp and paper operations. Nexfor's operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before before the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). change improved as higher returns from OSB OSB abbr. Order of Saint Benedict operations more than offset continued weakness in the pulp and paper business caused by lower prices and higher energy costs. Corporate and Outlook The company's Board of Directors declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. the regular quarterly dividends on its Series B and C preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. payable on September September: see month. 30, 2003 to shareholders of record on September 20, 2003. The company's affiliates are beginning to benefit from the productivity improvement and cost containment cost containment, n the features of a dental benefits program or of the administration of the program designed to reduce or eliminate certain charges to the plan. measures taken over the past two years. These initiatives, along with Noranda's recapitalization plan, should lead to improvements in our affiliates' earnings as product prices rebound rebound (rē´bownd), n/v 1. a recovery from illness. n 2. an outbreak of fresh reflex activity after withdrawal of a stimulus rebound adjective . Brascade Resources Inc. is a natural resources investment company with interests in the mining and forest products sectors. Brascan Corporation owns 99.9% of the common shares of Brascade.
FINANCIAL STATEMENTS
Statement of Operations (unaudited)
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Three months ended Six months ended
June 30 June 30
millions, except per share
amounts 2003 2002 2003 2002
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Income
Equity income (loss) from
Noranda Inc. $ (8.0) $ 11.0 $ (27.2) $ 9.6
Equity income from Nexfor
Inc. - 3.7 - 4.3
Other income 2.0 1.8 3.9 3.5
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(6.0) 16.5 (23.3) 17.4
Expenses
Corporate - - 0.1 0.1
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Net income (loss) $ (6.0) $ 16.5 $ (23.4) $ 17.3
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Net income (loss) per
common share (Note 2) $ (0.25) $ 0.09 $ (0.67) $ (0.06)
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Statement of Retained Earnings (Deficit) (unaudited)
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Three months ended Six months ended
June 30 June 30
millions 2003 2002 2003 2002
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Retained earnings
(deficit), beginning of
period $(263.2) $ (0.6) $(235.1) $ 9.3
Net income (loss) for the
period (6.0) 16.5 (23.4) 17.3
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(269.2) 15.9 (258.5) 26.6
Preferred share dividends 10.9 10.9 21.6 21.6
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Retained earnings
(deficit), end of period $(280.1) $ 5.0 $(280.1) $ 5.0
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Balance Sheet (unaudited)
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June 30 December 31
millions 2003 2002
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Assets
Loans and securities $ 55.5 $ 73.3
Investment in Noranda Inc. 765.8 793.0
Investment in Nexfor Inc. 273.8 273.8
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$ 1,095.1 $ 1,140.1
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Liabilities
Accounts payable $ 0.5 $ 0.5
Shareholders'equity (Note 3) 1,094.6 1,139.6
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$ 1,095.1 $ 1,140.1
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Statement of Cash Flows (unaudited)
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Three months Six months
ended June 30 ended June 30
millions 2003 2002 2003 2002
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Dividends received $ 17.4 $ 16.7 $ 34.6 $ 33.4
Other income received
net of expenses paid 2.0 1.8 3.8 3.4
Investment in Noranda Inc.
and Nexfor Inc. (17.4) (3.1) (34.6) (6.1)
Preferred dividends paid (10.9) (10.9) (21.6) (21.6)
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Loans and securities
Increase (Decrease) (8.9) 4.5 (17.8) 9.1
Balance, beginning of period 64.4 87.4 73.3 82.8
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Balance, end of period $ 55.5 $ 91.9 $ 55.5 $ 91.9
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NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF ACCOUNTING POLICIES Reference is made to the most recently issued Annual Report of Brascade Resources Inc. (the "company"), which includes information necessary or useful for understanding the company's businesses and financial statement presentation. In particular, the company's significant accounting policies and practices are presented as Note 1 to the Financial Statements included in that Report, and have been consistently applied in the preparation of these interim financial statements. The interim financial statements are unaudited and follow the accounting policies summarized in the notes to the annual financial statements. Financial information in this release reflects any adjustments (consisting only of normal recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. adjustments) that are, in the opinion of management, necessary to a fair statement of results for the interim periods in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . The results reported in these financial statements should not be regarded as necessarily indicative of results that may be expected for the entire year. Certain prior period amounts have been reclassified to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the current period's presentation. 2. NET LOSS PER COMMON SHARE Net loss per common share is after payment of preferred share dividends. 3. SHAREHOLDERS' EQUITY Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares.
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June 30 December 31
millions,
except number of shares 2003 2002
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10,501,528 Preferred shares Series B
(2002 - 10,501,528) $ 420.1 $ 420.1
3,125,000 Preferred shares Series C
(2002 - 3,125,000) 125.0 125.0
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545.1 545.1
66,999,326 Common shares
(2002 - 66,999,326) 779.6 779.6
Contributed surplus 50.0 50.0
Retained earnings
(deficit) (280.1) (235.1)
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$ 1,094.6 $1,139.6
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