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FLETCHER CHALLENGE CANADA LTD. ANNOUNCES RESULTS

 FLETCHER CHALLENGE CANADA LTD. ANNOUNCES RESULTS
 VANCOUVER, British Columbia, July 22 /PRNewswire/ -- Fletcher


Challenge Canada Ltd. today reported a net loss of $44.4 million, or 70 cents per common share for the first six months of 1992.
 The results compare with a net loss of $27.2 million, or 45 cents per common share, for the same period of 1991. Sales for six months declined to $456 million from $536 million a year ago.
 The company recorded a net loss of $20.1 million, or 30 cents per common share, on sales of $226 million for the three months ended June 30, 1992. The quarterly results compare with a net loss of $16.5 million, or 27 cents per common share, and sales of $270 million for same period in 1991.
 Company President Doug Whitehead said earnings continued to be severely impacted by depressed prices for pulp and paper.
 "While prices for newsprint and lightweight coated paper remain at low levels, we are encouraged by the upward trend in market pulp prices," Whitehead said.
 He noted pulp prices had risen by U.S. $60 per ton during the first six months but still remained U.S. $20 below where they were a year ago. Newsprint prices continued to deteriorate during the quarter and were down more than U.S. $100 from a year ago, he said.
 Whitehead said the company's operating rates and sales volumes improved as customers increased orders to prepare for the industrywide strike in British Columbia which shut down the company's pulp and paper mills June 15.
 Production losses resulting from the pulp and paper strike did not have a significant impact on the company's results.
 Lightweight coated paper markets for the company's U.S. subsidiary, Blandin Paper Co., continued to be affected by excess capacity and reduced levels of magazine and catalogue advertising. Production at Blandin was curtailed for 10 days during the quarter to keep inventories in line with reduced demand.
 Lumber markets remained mixed during the quarter with low demand in the United Kingdom and oversupply in Asia. An increase in the annualized rate of U.S. housing starts to 1.2 million units helped improve lumber markets in North America.
 Whitehead said that the company is committed to take the tough actions necessary to become internationally competitive.
 "We will continue to focus on cash conservation and cost reduction initiatives such as the recent restructuring of our Vancouver Island logging operations." The six-month loss included restructuring expenses of $4.6 million after tax.
 "From a marketing standpoint, we will continue to develop value- added specialty grades of printing papers to lower our exposure to newsprint."
 The company's recent $250 million share issue lowered its debt to equity ratio to .39-to-1, he said. However, because of the timing of the issue, the full benefits of interest expense reduction were not evident in the results for the quarter.
 Noting that capital expenditures for the period were $14.7 million compared with $112.7 million in the first six months of 1991, Whitehead said the company's major upgrading program is now complete.
 "We now have quality production facilities in place which are technically superior and environmentally responsible. This will be an enormous benefit to our company as markets recover."
 FLETCHER CHALLENGE CANADA LTD.
 Interim Report
 Consolidated Supplemental Information
 For the six-month fiscal year ended, June 30, 1992
 (In millions of dollars)
 (Unaudited)
 Three Months Ended Six Months Ended
 June 30, June 30,
 1992 1991 1992 1991
 Earnings:
 Net sales $225.9 $269.5 $455.7 $536.0
 Cost of products sold 208.6 253.1 418.9 492.2
 Depreciation, depletion &
 amortization 22.1 20.8 45.8 42.4
 Selling & administrative 15.3 16.4 32.4 33.0
 Subtotal 246.0 290.3 497.1 567.6
 Total (20.1) (20.8) (41.4) (31.6)
 Earnings from associate
 companies before income
 taxes --- 1.6 --- 6.5
 Operating loss (20.1) (19.2) (41.4) (25.1)
 Interest expense 13.3 12.8 28.9 25.8
 Gain on disposal of
 fixed assets 0.1 0.4 0.3 0.8
 Investment & other
 income (expense) (0.5) 4.9 (2.3) 6.7
 Loss before income taxes (33.8) (26.7) (72.3) (43.4)
 Income taxes (recovery) (13.7) (10.2) (27.9) (16.2)
 Net loss ($20.1) ($16.5) ($44.4) ($27.2)
 Net loss per weighted
 average common share
 (in dollars) ($0.30) ($0.27) ($0.70) ($0.45)
 Weighted average shares
 outstanding (000) 67,602 60,057 63,894 60,033
 Period ending shares
 outstanding (000) 77,058 60,086 77,058 60,086
 Other Information:
 Cash generated from
 (applied to) operations ($18.8) $5.8 ($33.9) $20.9
 Additions to fixed assets $6.4 $65.9 $14.7 $112.7
 Ratio of debt to equity 0.39 0.71
 Product Shipments:
 Three Months Ended Six Months Ended
 June 30, June 30,
 1992 1991 1992 1991
 Newsprint - M tons 102 79 186 183
 Market kraft pulp
 - M tons(a) 84 72 177 139
 Lightweight coated paper
 - M short tons 97 97 201 197
 Lumber - MMBM 157 224 310 384
 (a) Excludes shipments to
 Blandin - M tons 15 17 33 35
 Effective Jan. 1, 1992, the board of directors approved a change of the company's fiscal year end to June 30. This has resulted in a six-month fiscal year as reported herein.
 -0- 7/22/92
 /CONTACT: John Graf, VP-treasurer, 604-654-4383 or Stuart Clugston, 604-654-4463, both of Fletcher Challenge Canada/
 (FCC.) CO: Fletcher Challenge Canada Ltd. ST: British Columbia IN: PAP SU: ERN


EH -- LA027 -- 2204 07/22/92 19:43 EDT
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