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Abitibi-Price reports loss.

Abitibi-Price reports loss

Abitibi-Price has reported a loss of $3.7 million, or six cents per share, for the second quarter of this year.

That compares with earnings of $28.8 million, or 39 cents per share, in the same quarter of 1989.

The latest quarter includes a charge of $28.9 million for unusual items, largely the cost of staff reductions associated with the company's restructuring. Without that, the quarter would have shown before-tax earnings of $23.9 million and after-tax earnings of $14.1 million, or 20 cents per common share.

For the first half of 1990, the company reported a loss of $15 million, or 23 cents per common share, compared with net earnings of $55.1 million, or 74 cents per share, in 1989.

The first-half loss included unusual items of $42.6 million, consisting of the restructuring costs and a $13.7-million write-off of an old machine at the groundwood papers mill in Jonquiere, Que., and of the Jaffe retail office products business in Florida.

Without the unusual items, the first half would have shown before-tax earnings of $11.5 million, or 15 cents per common share.

"While the restructuring plan has had a markedly negative impact on 1990 earnings, the long-term effect will be increased profitability," said Bernd K. Koken, chairman and chief executive officer. "The company will be better positioned to compete in the increasingly competitive international market place."

Sales in the second quarter of 1990 were $803 million, compared with $830 million in 1989, while sales for the six months were $1.6 billion, virtually the same as last year.

The June 1 newsprint price increase, improving demand and the successful start-up of the Alabama newsprint mill were bright spots during an otherwise lacklustre quarter.

The improvement in demand, however, was due to a build-up of publishers' inventories, not increased consumption.
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Title Annotation:Forestry News
Publication:Northern Ontario Business
Date:Aug 1, 1990
Words:309
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