Brascade Corporation Announces its 2004 Year End Results.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- Brascade Corporation (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :BCA BCA Business Case Analysis BCA Building Code of Australia BCA Boeing Commercial Airplanes BCA Board of Contract Appeals BCA Boston Center for the Arts BCA Billiard Congress of America BCA Bureau of Criminal Apprehension BCA Breast Cancer Action .PR.B) today announced net income for the year ended December December: see month. 31, 2004 of $230.4 million, compared to $62.2 million for the year ended December 31, 2003. This significant improvement reflects stronger results from all areas of investment. Net income for the three months ended December 31, 2004 was $3.8 million compared to $33.8 million in the same period of 2003. Commencing with the fiscal year ended December 31, 2004, the company is reporting its financial results in U.S. dollars, since most of our revenues are denominated in that currency and a significant portion of our operations are based in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . All financial information throughout this release is stated in U.S. dollars unless otherwise indicated. Brascade Corporation is the successor company to Brascade Resources Inc., which amalgamated a·mal·ga·mate v. a·mal·ga·mat·ed, a·mal·ga·mat·ing, a·mal·ga·mates v.tr. 1. To combine into a unified or integrated whole; unite. See Synonyms at mix. 2. with a subsidiary of its parent, Brascan Corporation, on September September: see month. 13, 2004. Investment Results Mining and metal investments contributed $130.8 million for the year ended December 31, 2004, compared with $23.8 million in the year ended December 31, 2003. This improved performance reflects mainly higher metal prices and increased sales volumes in the copper and nickel nickel, metallic chemical element; symbol Ni; at. no. 28; at. wt. 58.69; m.p. about 1,453°C;; b.p. about 2,732°C;; sp. gr. 8.902 at 25°C;; valence 0, +1, +2, +3, or +4. businesses, offset slightly by the negative impact of a 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 on costs. Forest product investments contributed $70.9 million for the year ended December 31, 2004, up from $27.8 million in 2003. This improvement reflects strong prices and increased production of oriented o·ri·ent n. 1. Orient The countries of Asia, especially of eastern Asia. 2. a. The luster characteristic of a pearl of high quality. b. A pearl having exceptional luster. 3. strandboard, higher prices for pulp and lumber lumber, term for timber that has been cut into boards for use as a building material. The major steps in producing lumber involve logging (the felling and preparation of timber for shipment to sawmills), sawing the logs into boards, grading the boards according to and cost reductions, offset partly by higher fibre and energy costs. Corporate As previously announced, the company has joined Brascan in supporting a plan by its mining and metals affiliate, Noranda Noranda: see Rouyn-Noranda, Que., Canada. Inc., to combine with Noranda's subsidiary, Falconbridge Limited. The company also announced that together with Brascan it will support Noranda's substantial issuer bid, whereby Noranda plans to offer to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to 63.4 million of its common shares in exchange for $1.25 billion of new junior 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. of Noranda. As part of this plan, the company and Brascan have agreed to deposit all the Noranda common shares they own to the Issuer Bid. The company's Board of Directors declared the regular quarterly dividends on its Senior Preferred Shares, Series B payable on March 31, 2005 to shareholders of record on March 20, 2005. The company's investments are benefiting from higher metal and panelboard prices as well as 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. Brascade Corporation holds investments in the natural resources and property sectors. The common shares of Brascade are wholly owned by Brascan Corporation, an asset management company with a focus on property, power and other infrastructure assets. Edward C. Kress, Chairman and President, will be available at 416-363-9491 to answer any questions on the company's financial results. This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. concerning the company's business and operations. The Company cautions that, by their nature, forward-looking statements involve risk and uncertainty and the company's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors.
Consolidated Statement of Operations
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Three months Twelve months
US$Millions, except per ended Dec. 31 ended Dec. 31
share amounts 2004 2003 2004 2003
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(Restated) (Restated)
Income
Equity income from Noranda Inc. $ 37.4 $ 17.3 $ 130.8 $ 23.8
Equity income from Norbord Inc. 14.5 15.7 79.3 27.8
Equity loss from Fraser
Papers Inc. (8.9) - (8.4) -
Foreign exchange gain (loss) (20.0) (0.5) (18.3) 5.6
Gain on sale of investment - - 66.0 -
Other income (loss) (7.5) 1.3 (0.2) 5.1
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15.5 33.8 249.2 62.3
Expenses
Interest expense 11.7 - 18.4 -
Corporate - - 0.4 0.1
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11.7 - 18.8 0.1
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Net income $ 3.8 $ 33.8 $ 230.4 $ 62.2
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Net income per common share $ 0.15 $ 1.02 $ 8.23 $ 1.24
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Consolidated Statement of Retained Earnings (Deficit)
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Three months Twelve months
ended Dec. 31 ended Dec. 31
US$Millions 2004 2003 2004 2003
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(Restated) (Restated)
Deficit, beginning of period $(994.6) $(142.1) $ (116.5) $(149.3)
Reorganization (Note 1) - - (1,080.1) -
Adjustment for change in
accounting policy (Note 2) - - - 1.7
Net income for the period 3.8 33.8 230.4 62.2
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(990.8) (108.3) (966.2) (85.4)
Preferred share dividends - 8.2 24.6 31.1
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Deficit, end of period $(990.8) $(116.5) $ (990.8) $(116.5)
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Consolidated Balance Sheet
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December 31 December 31
US$Millions 2004 2003
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(Restated)
Assets
Loans receivable $ 102.6 $ -
Securities 103.3 30.7
Investment in Noranda Inc. 821.8 714.5
Investment in Norbord Inc. 177.3 199.6
Investment in Fraser Papers Inc. 203.8 -
Investment in Canary Wharf Group, plc 524.8 -
Other assets 8.4 -
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$ 1,942.0 $ 944.8
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Liabilities
Accounts payable $ 2.2 $ 0.4
Term debt (Note 3) 291.7 -
Exchangeable debentures (Note 4) 206.7 -
Retractable preferred shares (Note 5) 1,865.7 -
Shareholders'equity (deficiency) (Note 6) (424.3) 944.4
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$ 1,942.0 $ 944.8
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge 1. On September 13, 2004, Brascade Resources Inc. ("Brascade Resources") amalgamated with 4250231 Canada Limited, a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Brascan Corporation ("Brascan"), to form Brascade Corporation (the "company"). At the date of amalgamation amalgamation /amal·ga·ma·tion/ (ah-mal´gah-ma´shun) trituration (3). amalgamation ( , Brascade Corporation became a mutual fund corporation under the Income Tax Act (Canada). At the time of the amalgamation, Brascade Resources owned approximately 25% of the common shares of Noranda Inc. ("Noranda"), 21% of the common shares of Fraser Papers Fraser Papers Inc. TSX: FPS is a Toronto, Ontario, Canada-based manufacturer of specialized printing, publishing, and converting papers, with customers in Canada and the US. It manages more than two million acres (8,000 km²) of forest, operates a tree nursery, and sawmills. Inc. ("Fraser Papers") and 21% of the common shares of Norbord Inc. ("Norbord"), and 4250231 Canada Limited owned approximately 21% of the common shares of Fraser Papers, 21% of the common shares of Norbord and 17% of the ordinary shares of Canary Wharf
Canary Wharf is a large business development in London, located on the Isle of Dogs in the London Borough of Tower Hamlets, centred on the old West India Docks in Group, plc. 4250231 Canada Limited acquired its interests in Fraser Papers and Norbord from Brascan immediately prior to the amalgamation. In conjunction with this amalgamation, Brascan became the sole holder of the company's common shares. The publicly traded Preferred Shares of Brascade Resources, Series B and Series C, were exchanged for Senior Preferred Shares of the company, Series B and Series A, respectively, having the same terms, except for the elimination of their general voting rights Voting rights The right to vote on matters that are put to a vote of security holders. For example the right to vote for directors. voting rights The type of voting and the amount of control held by the owners of a class of stock. and the addition of redemption rights at the option of the holders. At the time of the reorganization and amalgamation, Brascade Resources and 4250231 Canada Limited were controlled by Brascan and, accordingly, the accounts of the company are prepared on a continuity of interest basis with the assets and liabilities being combined at their carrying values Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. in the accounts of their predecessors, with the differences from exchange amounts being recorded as an adjustment to retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. (deficit). 2. ACCOUNTING POLICIES Reference is made to the most recently issued Annual Report of Brascade Resources, 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 2 to the Financial Statements included in that Report, and have been consistently applied in the preparation of these interim financial statements. The company places surplus cash on deposit with its major shareholder at market rates. These deposits are available on demand and are used by the company to fund its cash requirements. As the company does not maintain its own stand alone banking facilities, the statement of cash flows is reconciled to nil. Effective January 1, 2004, the company's equity accounted investees adopted the Canadian Institute of Chartered Accountants The Canadian Institute of Chartered Accountants (CICA) is the umbrella body for the Chartered Accountant profession in Canada and Bermuda. Membership of the CICA totals 70,000 Chartered Accountants and 8,500 students. ("CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) ") Handbook
This article is about reference works. For the subnotebook computer, see .
Firms must recognize the ARO liability in the period it was acquired, generally acquisition. ". 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 section 3110, asset retirement obligations are recognized when incurred and recorded as liabilities at fair value. The amount of the liability is subject to re-measurement at each reporting period. The liability is accreted over time through periodic charges to earnings. In addition, the asset retirement cost is capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. as part of the asset's carrying value and amortized over the estimated life of the related asset. This change in accounting policy was applied retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin and, accordingly, the financial statements of prior periods were restated. As a result of this change, the cumulative impact from the adoption of this standard at January 1, 2003 was to decrease retained earnings by $7.0 million. Adoption of the new standard reduced net income by $2.5 million for the year ended December 31, 2003. 3. TERM DEBT The term debt is due to a common control company, bears interest at 6.5% and is due on June 30, 2009. 4. EXCHANGEABLE DEBENTURES On September 30, 2004, the company issued debentures ("Debentures") with a principal amount of C$255 million for net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of C$245 million, that are exchangeable for 20,000,000 Common Shares (the "Shares") of Norbord and will mature on September 30, 2029. Each C$1,000 principal amount of Debentures are exchangeable at any time prior to maturity at the option of the holder into 78.4314 Shares. The Debentures bear interest at a rate per annum Per annum Yearly. equal to the aggregate of 1.00% plus the Additional Interest Rate. The Additional Interest Rate in the first interest period will be 3.1459% and in each semi-annual interest period will be equal to the percentage per annum obtained by dividing (i) the product of (a) the amount of all cash dividends on the Norbord shares paid in respect of 78.4314 Shares during the immediately preceding interest period; and (b) the quotient quotient - The number obtained by dividing one number (the "numerator") by another (the "denominator"). If both numbers are rational then the result will also be rational. obtained by dividing 365 (366) by the number of days in the immediately preceding interest period; by (ii) the Offering Price of C$1,000; and multiplying mul·ti·ply 1 v. mul·ti·plied, mul·ti·ply·ing, mul·ti·plies v.tr. 1. To increase the amount, number, or degree of. 2. Mathematics To perform multiplication on. the quotient by 100. Interest will be payable semi annually on March 31st and September 30th in each year commencing March 31, 2005. The March 31, 2005 interest payment will represent accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. for the period from September 30, 2004 to but excluding March 31, 2005.
5. RETRACTABLE PREFERRED SHARES
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December 31 December 31
US$Millions, except number of shares 2004 2003
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6,846,504 Class 1 Senior Preferred
Shares, Series B (2003 - nil) $ 228.3 $ -
52,807,686 Class 2 Junior Preferred
Shares, Series A(2003 - nil) 1,637.4 -
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$ 1,865.7 $ -
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The retractable re·tract v. re·tract·ed, re·tract·ing, re·tracts v.tr. 1. To take back; disavow: refused to retract the statement. 2. preferred shares were issued effective September 13, 2004 at the time of the reorganization and amalgamation referred to in Note 1 and were approved by the company's shareholders. All of the shares were issued in exchange for shares already in existence. These shares are retractable at the option of the holder and, accordingly, are liabilities for accounting purposes.
6. SHAREHOLDERS' EQUITY
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December 31 December 31
US$Millions, except number of shares 2004 2003
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(Restated)
Nil Preferred shares, Series B
(2003 - 10,501,528) $ - $ 271.3
Nil Preferred shares, Series C
(2003 - 3,125,000) - 80.7
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- 352.0
25,000,003 Common shares (2003 - 66,999,326) 512.9 612.1
Contributed surplus - 32.3
Deficit (990.8) (116.5)
Cumulative translation adjustment 53.6 64.5
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$ (424.3) $ 944.4
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7. RESTATED COMPARATIVE FIGURES The financial statements of the company for the three months ended December 31, 2003 and the twelve months ended December 31, 2003 have been restated due to the adoption of the CICA Handbook section 3110 "Assets Retirement Obligation". The effect is to decrease previously reported net income for the three months ended December 31, 2003 by $1.1 million and to decrease previously reported net income for the twelve months ended December 31, 2003 by $2.5 million. Certain other comparative figures have been reclassified to conform with the basis of the presentation adopted subsequent to September 13, 2004. Brascade Corporation (TSX:BCA.PR.B) |
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