Printer Friendly

FLETCHER CHALLENGE CANADA REPORTS RESULTS

 FLETCHER CHALLENGE CANADA REPORTS RESULTS
 VANCOUVER, British Columbia, Feb. 6 /PRNewswire/ -- Fletcher


Challenge Canada Ltd. (Toronto, Montreal, Vancouver: FCC.A) today reported a net loss for 1991 of $26.3 million, or 44 cents per common share. These results compare with 1990 net earnings of $54.9 million or 92 cents per common share. Both years benefitted from gains on the sales of certain of the company's non-strategic assets. Net sales for 1991 declined to $1 billion from $1.2 billion in the previous year.
 In 1991, a net after-tax gain of $35.3 million from the sale of company assets contributed substantially to the annual and fourth quarter results. Assets sold included the company's 45 percent interest in Donohue St-Felicien Inc., the sale of the Hammond sawmill and released assets, and the sale of the former Victoria sawmill property.
 In 1990, the company's results included an after-tax gain of $21 million in the second quarter from the sale of its oriented strand board plant in Minnesota and a fourth quarter net gain of $7.8 million from the utilization of previously acquired tax losses.
 The company's fourth quarter net earnings of $17.2 million, or 28 cents per common share, compares with a loss of $1.8 million, or 3 cents per common share, reported for the same period a year ago. Net sales in the last three months of 1991 were $250 million, down substantially from sales of $324 million in 1990.
 Ian Donald, president and chief executive officer, said reduced demand and weak prices for most of the company's principal products made 1991 one of the most difficult years in Fletcher Challange Canada Ltd.'s history.
 "Declining kraft pulp markets had the most significant impact on our results as list prices for northern bleached softwood kraft pulp fell by US$250 per ton during the year," Donald said.
 Donald said the soft newsprint demand, combined with excess supply in the marketplace, led to production curtailments and depressed prices through widespread discounting.
 "Poor markets for lightweight coated paper in the U.S. also resulted from excess supply and much lower consumption due to a slump in print advertising levels.
 "With U.S. housing starts at a 45-year low of 1 million units, despite lower interest rates, demand for wood products was extremely weak in North America. Oversupply continued to be a major factor in North America and Japan, while demand was also depressed by the weak performance of many European economies."
 Donald said the company expects 1992 to produce some modest improvements in its market areas, but cautioned that the rate of recovery is likely to be slow.
 "We are encouraged by some modest increases in pulp prices which began to materialize at year end and which hopefully signal the end of this very protracted downcycle.
 "With our major capital program largely behind us and additional capacity in pulp, lightweight coated paper and recycled newsprint to bring to market as the economic recovery continues, we are competitively positioned to see our financial condition respond."
 FLETCHER CHALLENGE CANADA LTD.
 Consolidated Supplemental
 Information Three Months Ended 12 Months Ended
 Dec. 31, Dec. 31,
 (in millions of dollars) 1991 1990 1991 1990
 unaudited
 Earnings
 Net Sales $250.0 $323.9 $1,037.6 $1,160.4
 Cost of products sold 240.4 298.5 959.6 998.7
 Depreciation, depletion &
 amortization 23.3 19.8 88.7 69.6
 Selling & administrative 16.2 19.4 66.1 75.8
 Total 279.9 337.7 1,114.4 1,144.1
 (29.9) (13.8) (76.8) 16.3
 Earnings from associate
 companies before
 income taxes 0.7 7.6 7.8 37.2
 Operating earnings (loss) (29.2) (6.2) (69.0) 53.5
 Interest expense 17.6 13.8 58.2 28.7
 Gain on disposal of fixed
 assests and investments 58.1 0.8 58.8 28.9
 Investment & other income 1.7 12.3 12.1 27.4
 Earnings (loss) before
 income taxes 13.0 (6.9) (56.3) 81.1
 Income taxes (recovery) (4.2) (5.1) (30.0) 26.2
 Net earnings (loss) $17.2 ($1.8) ($26.3) $54.9
 Net earnings (loss) per
 common share (in dollars)$ 0.28 ($0.03) ($0.44) $0.92
 Number of shares
 outstanding (000) 60,186 59,976
 Other Information

 Cash flow from operations ($19.9) $54.7 ($28.9) $131.8
 Additions to fixed assets $32.8 $80.9 $176.4 $247.6
 Ratio of debt to equity 0.69 0.58
 Product Shipments
 Three Months Ended 12 Months Ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 Newsprint - M tonnes 76 129 342 451
 Market kraft pulp - M tonnes 112 90 383 324
 Lightweight coated paper
 - M short tons (a) 98 107 396 283
 Lumber - MMBM 176 244 745 888
 Panels - MMSF 3/8'' (b) - 17 9 270
 (a) Excludes 99 M short tons shipped while Blandin's No. 6 paper
 machine was in start-up phase until Sept. 30, 1990.
 (b) Includes shipments from Blandin's oriented strand board mill of
 176 MMSF in 1990. This facility was sold in June 1990.
 Includes shipments of 94 MMSF (17MMSF in the fourth quarter)
 from Delta Plywood in 1990. This facility ceased operations in
 February 1991.
 -0- 2/6/92
 /CONTACT: John Graf, VP and treasurer, 604-654-4383, or Stuart Clugston, director-communications, 604-654-4463, both of Fletcher Challenge Canada/
 (FCC.A) CO: Fletcher Challenge Canada Ltd. ST: British Columbia IN: PAP SU: ERN


AL-JL -- LA025 -- 7819 02/06/92 14:46 EST
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Feb 6, 1992
Words:920
Previous Article:MOMENTUM FOR ROLL-UP REFORM BUILDS AS BENTSEN BECOMES 51ST SENATE CO-SPONSOR
Next Article:GREEN MOUNTAIN POWER REPORTS 1991 OPERATING RESULTS
Topics:


Related Articles
FLETCHER CHALLENGE CANADA ANNOUNCED RETIREMENT
FLETCHER CHALLENGE CANADA ANNOUNCES MOVE OF PRESIDENT
FLETCHER CHALLENGE CANADA LTD. ANNOUNCES RESULTS
FLETCHER CHALLENGE CANADA ANNOUNCES SALE OF LUMBER AND PLYWOOD OPERATIONS AT KELOWNA AND ARMSTRONG
FLETCHER CHALLENGE CANADA LTD. ANNOUNCES LOSS
FLETCHER CHALLENGE CANADA LTD. TO ACQUIRE ASSETS OF CROWN FOREST INDUSTRIES LTD.
FLETCHER CHALLENGE CANADA LIMITED ANNOUNCES EARNINGS
Fletcher Challenge US$300 Million Commercial Paper Program Rated A-2
Control block in Fletcher Challenge Canada transfers to Norway's Norske Skog following parent company's sale of its paper division.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters