Displaying items by tag: catalyst paper

Richard B. Evans, Chair of AbitibiBowater, today announced that David J. Paterson will step down as President and Chief Executive Officer on January 1, 2011, having successfully led the Company through the most far-reaching restructuring in its history. He will be succeeded by Richard Garneau, currently a member of the Board of Directors and the former President and Chief Executive Officer of Catalyst Paper Corporation.

David J. PatersonMr. Paterson has agreed to stay on in an executive advisory role through January 2011 and a non-executive advisory role through July 31, 2011, supporting a smooth transition and continued positive momentum for the Company. As announced yesterday, AbitibiBowater emerged from creditor protection as a lean, flexible and sustainable company, well-positioned for future growth.

"Throughout this time of transition, I have been inspired by the desire of all employees to create the right conditions to take AbitibiBowater back to profitability, build strong market presence, promote sustainability and position us for future success," said Mr. Paterson. "Today, after three years of very demanding work, the foundations for that success are clearly in place, and I feel it is the right time to turn my time and attention back to the other people in my life who inspire me - my wife and family."

"There is no doubt that Dave Paterson was the right person at the right time for AbitibiBowater," said Richard Evans. "He set an example through his dedication and hard work. He gave us a new vision and a drive to succeed, and motivated everyone to believe in our future. AbitibiBowater today is a testament to his commitment, and the Board and employees of the Company are extremely grateful to him for his decisive leadership."

Richard Garneau joined AbitibiBowater as a member of the Board of Directors in June 2010. Most recently, he served as President and Chief Executive Officer of Catalyst Paper Corporation from March 2007 to May 2010. Prior to his tenure at Catalyst, he held a variety of roles in the forest products industry. Upon graduating with a Degree in Administration from Laval University in Quebec in 1971, Mr. Garneau joined Ernst & Young and remains a member today of the Canadian Institute of Chartered Accountants.

"AbitibiBowater is a company with a long history, skilled and dedicated employees, and a determination to succeed as a profitable and sustainable enterprise," said Richard Garneau. "Dave Paterson and his team have laid the foundation for a future success story, and I'm excited for the opportunity to help write its next chapter."

AbitibiBowater is a global leader in the forest products industry, producing a diverse range of products, including newsprint, commercial printing and packaging papers, market pulp and wood products. The Company owns or operates 18 pulp and paper mills and 24 wood products facilities located in the United States, Canada and South Korea. Marketing its products in more than 70 countries, AbitibiBowater is also among the largest recyclers of old newspapers and magazines in North America, and has third-party certified 100% of its managed woodlands to sustainable forest management standards.

Published in Canadian News

Catalyst Paper has announced that it is permanently closing its Elk Falls paper mill near Campbell River, British Columbia in September. This facility has been indefinitely curtailed since February 2009.

“Today’s news is a disappointing outcome for mill employees and families, for the community, and for our business,” said Catalyst President and CEO Kevin J. Clarke. “The steep decline in commodity paper markets, coupled with uncompetitive labour and tax costs were contributing factors that could not be overcome.”

“Adaptation has always been the key to survival,” Clarke noted, “and the uncertainty regarding the future of this mill was detrimental to all our operations and had to come to an end. With this difficult decision behind us, we can now focus our sales and marketing strategies and production planning around mills that still have the potential to operate competitively which is a better basis to future-focus our business overall.”

In a related decision, Catalyst also announced the permanent closure of its paper recycling operation in Coquitlam, British Columbia. The facility, which supplied the company’s Crofton mill, was indefinitely idled in February due to reduced recycled pulp requirements, combined with higher cost and constrained availability of quality recovered paper. All employees were laid off at the time.

The associated asset impairment charge, including severance costs, is estimated at $302 million and will be reflected in the company’s second quarter results. Only a small number of employees will continue to be required to manage and decommission the facility resulting in approximately 100 Elk Falls employees being immediately impacted by the permanent closure.

The Elk Falls mill began operation in 1952, and at its peak, produced 784,000 tonnes of pulp, paper and kraft paper annually.

Catalyst Paper manufactures diverse specialty printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With five mills located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.0 million tonnes. The company is headquartered in Richmond,

British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is also ranked by Corporate Knights as one of the 50 Best Corporate Citizens in Canada.

Forward-Looking Statements

Certain matters set forth in this news release, including statements with respect to severance costs and asset impairment charges related to the shutdown of the Elk Falls paper mill, are forward looking. These forward-looking statements reflect management’s current views and are based on certain assumptions and courses of action, as well as other factors management believes are appropriate. Such forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in these statements, including those risks and uncertainties identified under the heading “Risks and uncertainties” in the management’s discussion and analysis contained in Catalyst’s first quarter 2010 interim report available at www.sedar.com.

For more information:

Lyn Brown
Vice-President, Corporate Relations
604-247-4713

Published in Canadian News
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Catalyst Paper (TSX:CTL) has recorded a net loss attributable to the company of $44.1 million ($0.12 per common share) on sales of $273.3 million for the first quarter of 2010. The net loss increased from $35.8 million in the preceding quarter ($0.09 per common share), due to declining specialty printing paper prices and additional production curtailment. Higher restructuring, input and maintenance costs further impacted Q1 results.

Before specific items, Catalyst posted a net loss attributable to the company of $37.6 million ($0.10 per common share), in contrast to $21.8 million in the fourth quarter of 2009 ($0.06 per common share). Specific items after-tax included restructuring costs of $10.1 million and bond exchange-related costs of $5.9 million, offset by a foreign exchange gain on long-term debt of $11.7 million.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the first quarter were negative $16.2 million, compared with positive EBITDA of $14.1 million in the preceding quarter. Before specific items, EBITDA deteriorated to negative $2.1 million from positive $15.5 million in the prior quarter. The Q1 operating loss of $48.9 million, compared to a $41.1 million loss in Q4, reflected lower EBITDA.

“We saw some recovery in print advertising from the very low levels of a year ago and as a consequence, paper demand is up slightly,” said President and CEO Richard Garneau. “Pulp strengthened as various events combined to drive price recovery and we could see a more extended pulp up-cycle. Markets for all products going forward will be influenced by industry re-start decisions and operating rates.”

Paper demand remained well below pre-recession levels, and benchmark prices dropped further for coated, uncoated and directory grades. North American newsprint consumption continued to decline, and although offshore exports helped boost the benchmark price over the preceding quarter, it remained well below the level of a year ago. Continued pulp price recovery was driven in part by production interruptions in Chile and other regions, and in late March the company announced it would restart the second pulp line at Crofton in the second quarter.

In light of weak paper markets, the three paper machines at the Elk Falls division remained indefinitely curtailed. The No. 1 newsprint machine at Crofton, seasonally curtailed in December, was indefinitely idled in January, and as a result, the Paper Recycling division, which supplied de-inked pulp to Crofton, was curtailed in February. Total first-quarter production curtailments represented 14 per cent of specialty paper capacity, 52 per cent of newsprint capacity, and 36 per cent of market pulp capacity.
Restructuring costs during the quarter increased due to severance of some 300 employees who became eligible for and elected this option. Most had been laid off as a result of the Elk Falls curtailment. In light of some progress in tax-related discussions with Campbell River, Catalyst put forward a proposed restart plan for two specialty machines at Elk Falls to the hourly workforce based, in part, on achieving competitive labour costs at that mill.

Changes to post-retirement and benefit plans for salaried employees and retirees were implemented in the quarter, with expected annualized savings of $8 million.

Milestones reached in the company’s ongoing drive for more equitable and sustainable municipal tax treatment included an agreement in principle with the City of Powell River signed subsequent to quarter-end. The agreement entailed reduced taxation and pursuit of joint arrangements to meet municipal infrastructure needs that, when implemented, will bring the Powell River mill’s annual property tax cost down to $1.5 million. Catalyst is also seeking leave to appeal to the Supreme Court of Canada, following the April 22nd dismissal of its appeal concerning the North Cowichan 2009 tax bylaw by the Court of Appeal for British Columbia. In its decision, the court declined to strike down the tax bylaw, calling the “extreme imbalance” perpetuated by the District of North Cowichan a political problem requiring a policy decision by elected officials. The company accrued for this eventuality and has paid $15 million in outstanding 2009 property taxes, penalties and interest owing to the four municipalities where its mills are located.

“This appeal court decision, while disappointing, simply reinforces that solving the problem of unsustainable Class 4 tax rates rests with governments in BC. Until corrective steps are taken, major industry jobs and capital investments in this province will continue to be at risk,” said Mr. Garneau.

Catalyst completed the exchange of US$318.7 million of its 8.625 per cent senior notes due June 2011, for US$280.4 million of new 11 per cent senior secured notes due December 2016. As of quarter-end, US$35.5 million of the 2011 notes remained outstanding. Catalyst received credit-rating downgrades during the quarter from Moody’s and Standard and Poor’s.

Slow improvement in North American print advertising is expected over the balance of 2010, with minor recovery in coated and uncoated demand and pricing. Price increases to take effect April 1, May 15 and June 1, 2010 have been announced for coated, soft-calendared and high bright uncoated products. Price increases for pulp and newsprint have also been announced for Q2. Demand for directory is likely to contract though pricing is expected to be steady.

Catalyst expects to maintain capital spending, which was $3.2 million in the first quarter, at basic maintenance levels throughout 2010. However, $18 million in available Canadian federal government Green Transformation Program credits will be applied toward development of two capital-project proposals that deliver energy-efficiency and cost-reduction benefits.

Selected Financial Highlights

  2010 2009¹
  Q1 TOTAL Q4 Q3 Q2 Q1
Sales $273.3 $1,223.5 $295.0 $266.9 $300.7 $360.9
Operating earnings (loss) (48.9) (40.8) (41.1) (10.0) (21.5) 31.8
EBITDA 2 (16.2) 123.2 14.1 25.9 14.3 68.9
– before specific items 2 (2.1) 141.1 15.5 25.9 26.6 73.1
Net earnings (loss)attributable to the Company (44.1) (4.4) (35.8) 13.2 (1.9) 20.1
before specific items 2 (37.6) (58.8) (21.8) (19.8) (25.6) 8.4
EBITDA margin2 (5.9%) 10.1% 4.8% 9.7% 4.8% 19.1%
– before specific items 2 (0.8%) 11.5% 5.3% 9.7% 8.8% 20.3%
Net earnings (loss) per share attributable to the Company’s common shareholders (in dollars) basic and diluted (0.12) (0.01) (0.09) 0.03 (0.01) 0.06
– before specific items 2 (0.10) (0.15) (0.06) (0.05) (0.06) 0.02
  • 1 Effective January 1, 2010, the Company changed its policy with respect to certain of its derivative financial instruments and translation of foreign currency-denominated working capital balances. The new policies are considered preferable as they increase transparency of the economic hedging activity. Prior period comparative information has been restated to reflect this change of policy. Refer to the Company’s interim consolidated financial statements for the three month period ended March 31, 2010, Note 3, “significant accounting policies” for further details.
  • 2 EBITDA, EBITDA before specific items, EBITDA margin, EBITDA margin before specific items, net earnings (loss) attributable to the Company before specific items, and net earnings (loss) per share attributable to the Company’s common shareholders before specific items are non-GAAP measures. EBITDA margin and EBITDA margin before specific items are defined as EBITDA and EBITDA before specific items as a percentage of sales and adjusted sales, respectively. Refer to the Q1, 2010 Management Discussion and Analysis – Section 8, “Non-GAAP Measures” for further details.

The search for a successor to President and CEO Richard Garneau, whose term will conclude at the end of May, 2010, remains underway.

Further Quarterly Results Materials

This release, a summary slide presentation, and full quarterly report (MD&A, financial statements and accompanying notes) are available on our web site at www.catalystpaper.com/Investors. The full quarterly report is also filed with SEDAR in Canada and EDGAR in the United States.

Catalyst Paper manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six facilities located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is ranked by Corporate Knights magazine as one of the 50 Best Corporate Citizens in Canada.

Richard Garneau, president and CEO and Brian Baarda, vice-president, finance and CFO will hold a conference call on Thursday, April 29, 2010 at 11 a.m. ET, 8 a.m. PT to present the company’s first quarter results. Financial analysts and institutional investors are invited to dial 1-888-231-8191 (North America) or 1-647-427-7450 (Toronto / International) reservation number 69114814. Media and other interested people may join the live webcast by clicking here.

Forward-Looking Statement

Certain matters in this news release, including statements with respect to general economic and market conditions, demand for products, pricing expectations, anticipated cost savings and capital expenditures, are forward looking.  These forward-looking statements reflect management’s current views and are based on certain assumptions including assumptions as to future economic conditions, demand for products, levels of advertising, product pricing, ability to achieve operating and labour cost reductions, currency fluctuations, production flexibility and related courses of action, as well as other factors management believes are appropriate.  Such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in these statements, including those risks and uncertainties identified under the heading “Risks and uncertainties” in Catalyst’s management’s discussion and analysis in the interim report for the quarter ended March 31, 2010 and available at www.sedar.com.

Investors:
Brian Baarda
Vice-President, Finance & CFO
604-247-4710

Peter Staiger
Vice-President & Treasurer
604-247-4372

Media:
Lyn Brown
Vice-President, Corporate Relations
604-247-4713

Published in North American News
Tagged under

catalyst logoCatalyst Paper and the City of Powell River have inked an agreement in principle to achieve the twin objectives of reducing the Class 4 property tax rate paid by the company's Powell River mill while assisting the City in reducing significantly its capital expenditures for future municipal service infrastructure.

"Council committed to looking for solutions to the major industry property tax in Powell River,"
said Mayor Stewart Alsgard. "We have held frank, realistic discussions with Catalyst culminating in a very positive outcome that reflects the needs of the community and provides for a way forward under challenging circumstances."

Under the agreement, the City has committed that the company's annual property taxes payable to the City will not exceed $2.25 million for five years. In addition, the City and Catalyst agreed to jointly pursue environmental permit amendments and related arrangements that would enable a 20-year service agreement valued at $750,000 annually in the first five years, under which Catalyst will treat the City's liquid waste using the mill's effluent system and burn the City's bio-solids in the mill's waste wood boiler.

"We saw that we both had a cost problem associated with municipal services. And we came to a shared conclusion that, going forward, the City's circumstances could be addressed more cost-efficiently by making our mill infrastructure available for municipal use," said Richard Garneau, Catalyst president and chief executive officer. "Cooperation and flexibility helped us take a big step toward the $1.5 million property tax goal, and together the City and Catalyst were able to find a solution that's right for Powell River."

The agreement will see Catalyst drop its legal appeal of the City's 2009 municipal tax levy and pay into trust $2.5 million in outstanding 2009 municipal property taxes including penalties and interest, pending the City's completion of arrangements for implementing its 2010 business plan with the provincial government. Related commitments by the company include sale to the City of the mill's unoccupied administration office building and associated lands for a nominal price, and a four-year mortgage extension to PRSC LLP, a three-way partnership with the City and Tla'Amin First Nation formed in 2006 to facilitate local economic diversification through land sales.

The City and Catalyst will also explore a variety of joint economic development initiatives and a revenue upside contribution arrangement, capped at $500,000 annually, based on the Powell River paper mill's ability to achieve a return on capital employed in excess of 10%.

Catalyst Paper manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six facilities located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is ranked by Corporate Knights magazine as one of the 50 Best Corporate Citizens in Canada.

Located on the Sunshine coast 125 km north of Vancouver, Powell River is a vibrant and progressive community of approximately 13,500 with access to Vancouver, Vancouver Island and the Sechelt Peninsula. Powell River has an extensive variety of recreational activities and festivals, excellent schools, a modern multi-purpose recreational complex, golf course, new hospital and an active arts community. With something for everyone, Powell River has a high quality of life in a natural and beautiful environment.

For more information:

Lyn Brown
Vice President, Corporate Relations
Catalyst Paper Corporation
604-247-4713

Stan Westby, CA
Chief Administrative Officer
City of Powell River
604-485-8618

Published in Financial News

Catalyst Paper announced that it will restart the second line of pulp production at its Crofton NBSK kraft mill in early May, taking advantage of a stronger market. The first line of pulp production was restarted in October 2009 following a seven-month curtailment of the entire kraft mill due to weak pulp demand and pricing.

“We have adequate fibre supply and sales to support the additional volume which allows us to take advantage of the current uptick in pricing,” said Richard Garneau, president and chief executive officer. “We’ll run as long as the economics are positive and will be keeping a very close watch on the order file and inventory levels.”

Restart of Crofton’s second line of production will add 165,000 tonnes of pulp capacity on an annualized basis. All Crofton pulp mill employees who are currently on layoff will be recalled.

Catalyst Paper manufactures diverse specialty printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six facilities located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is ranked by Corporate Knights magazine as one of the 50 Best Corporate Citizens in Canada.

For more information:

Lyn Brown
Vice-President, Corporate Relations
604-247-4713

Published in European News

Catalyst Paper on the 9th March announced that it resubmitted a proposal to the union that could allow for the restart of the Elk Falls paper mill at a labour cost, all in, of approximately $40 per hour. This reflects current market realities and includes changes to wages and benefits similar to those already implemented with management and staff employees. The company also indicated that, to date, 63 per cent of eligible hourly workers at the Elk Falls operation have elected the severance option arising from indefinite curtailment of the mill since February 2009.

catalyst logo"With a competitive cost structure, there could be a future for Elk Falls mill and to that end we presented employees with a proposal that could lead to the restart of two specialty paper machines at the mill," said Richard Garneau, president and chief executive officer. "Nonetheless, we also recognize that electing to take severance is a personal choice.

"We hope the remaining employees want and will be given the chance to return to work and to continue to live in the community. We appreciate the Campbell River Mayor has shown strong commitment to preserving jobs through an agreement in principle that would address Class 4 property tax sustainability. And, while there are no guarantees that we will be able to overcome fibre supply shortages or acquire the customer orders necessary to restart, we know the outcome for this mill and community if nothing is done," he added.

Hourly employees at Elk Falls are represented by Communications, Energy and Paperworkers Union of Canada (CEP) locals 630 and 1123. Approximately 225 hourly workers have taken this option with an average severance payout of $57,000 per employee.

Catalyst Paper manufactures diverse specialty printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six mills located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is also ranked by Corporate Knights as one of the 50 Best Corporate Citizens in Canada.

Published in Canadian News
Tagged under
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