Donohue Posts Sales of $407 Million and Net Earnings of $22.6 Million for First Quarter in 1997.MONTREAL--(BUSINESS WIRE)--April 22, 1997--DONOHUE (ME,TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). DHC DHC Dihydrocodeine DHC District Heating and Cooling DHC Dark Horse Comics DHC Dynein Heavy Chain DHC DeHavilland Canada (aircraft) DHC Discovery Health Channel DHC Drop Head Coupe .A., ME, TSE DHC.B.) Donohue Inc. announced today that its net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the first quarter ended March 31, 1997, were $407 million, up 20 percent from net sales of $340.2 million in the first quarter of 1996. The Company posted net earnings of $22.6 million or $0.25 per share for the quarter, compared with $53.2 million or $0.65 per share a year earlier. The increase in sales is largely due to the fact that the 1996 first quarter results included only one month of sales from QUNO QUNO Quaker United Nations Office Corporation, because the acquisition was concluded only on March 1 of that year. The decline in net earnings is primarily attributable to the sharp drop in prices for newsprint and market pulp, which account for 68 percent of the Company's total sales volume. The lower newsprint and market pulp prices in relation to the corresponding period in 1996 were only partially offset by increased lumber prices. "Soft newsprint prices have reduced our profitability despite the significant increase in our sales volumes," said Donohue's President and Chief Executive Officer, Michel Desbiens. "Despite continuing unfavourable economic conditions for the pulp and paper industry The global pulp and paper industry is dominated by North American (United States, Canada), northern European (Finland, Sweden) and East Asian countries (such as Japan). Australasia and Latin America also have significant pulp and paper industries. , we are satisfied with Donohue's first quarter results, which have helped us sustain our leading position," continued Mr. Desbiens. There are signs of a recovery in the newsprint sector, where prices started moving up on March 1. Stocks at daily newspapers have returned to normal, and the Company is confident there will be an upswing in the market by the end of 1997. Even if the pulp market remains sluggish, the Company anticipates a gradual improvement in demand in the sector over the coming months. The lumber market remained active throughout the quarter, bolstered by very low mortgage rates which helped sustain high levels of housing starts in the United States and triggered a resurgence in residential construction in Canada. However, the increase in Quebec stumpage stump·age n. 1. Standing timber regarded as a commodity. 2. The value of standing timber. 3. The right to cut standing timber. stumpage 1. fees on April 1, combined with the quotas imposed a year ago on U.S. lumber exports, will somewhat reduce Donohue's profitability in this sector. The Directors of the Company declared quarterly dividends of 14 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on Class A subordinate voting shares Voting Shares Shares that give the stockholder the right to vote on matters of corporate policy making as well as who will compose the members of the board of directors. Notes: Different classes of shares, such as preferred stock, sometimes don't allow for voting rights. and on Class B shares, payable on June 2, 1997, to shareholders of record as at May 20, 1997. The Directors also declared quarterly dividends of 39.0625 cents on 6 1/4 percent 1967 Series 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. , to be paid on August 1, 1997, to shareholders of record as at July 18, 1997. Donohue Inc. is a major Canadian integrated forest products company that undertakes forest management operations to secure its fibre supply, and produces and markets newsprint, pulp and lumber. Donohue is the largest newsprint producer in Canada and the third largest in North America. Its facilities are among the most modern in the Canadian forest products industry. Donohue's Class A subordinate voting shares and Class B shares are traded on the Montreal and Toronto Stock Exchanges. The Company is a subsidiary of Quebecor Inc. CONTACT: Donohue Inc. Claude Helie, 514/847-7700, ext. 2625 or Donohue Inc. Andre Dupras, 514/847-7700, ext. 2804 |
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