|By PR Newswire||
|July 29, 2014 08:52 PM EDT||
RICHMOND, BC, July 29, 2014 /PRNewswire/ - Catalyst Paper (TSX:CYT) recorded adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the second quarter of $7.1 million compared to $25.7 million in the previous quarter. Strong operating performance was overshadowed by a planned maintenance outage at the Crofton pulp mill, higher power costs due to a hydroelectricity rate increase, a stronger Canadian dollar and lower transaction prices for pulp and all paper grades. Sales of $283.5 million exceeded the prior quarter by $9.6 million and reflected higher paper sales due in part to the delivery of shipments delayed by the Q1 container truck driver strike at Port Metro Vancouver.
Catalyst recorded a net loss of $6.3 million ($0.43 per common share) and a net loss before specific items of $13.6 in Q2. This compared to a net loss of $3.8 million ($0.26 per common share) and net earnings before specific items of $6.5 million the previous quarter. Free cash flow for the quarter was negative $8.6 million. Liquidity decreased $37.5 million from the prior quarter due to a lower borrowing base, debt redemption and buybacks in the quarter, the impact of the Crofton maintenance shut, and a scheduled interest payment.
Paper production volumes for the quarter were 3.5% higher than average production in 2013 and 2% higher than the first quarter of 2014 due to improved paper productivity. Two major debottlenecking initiatives were completed on the pulp mill during the scheduled maintenance outage to increase future pulp production.
"Our operating results were hampered by the cost and production impact of the recovery boiler shut, the hydroelectricity rate increase, and the strengthening Canadian dollar," said Catalyst President and CEO Joe Nemeth. "On the upside, we achieved a new record in paper productivity in the quarter, we're already seeing improved pulp production as a result of the debottlenecking work completed on the pulp mill, and our program to identify and implement opportunities for improvement is on track to realize significant benefits in 2014 and beyond."
On July 24, 2014, the Ministry of Energy and Mines and BC Hydro introduced a new energy efficiency program that provides a three-year funding injection of $100 million, with $45 million allocated to Catalyst Paper. The BC Hydro Power Smart program is aimed at reducing the energy intensity and improving the energy efficiency of thermal-mechanical pulping facilities in British Columbia. The program will benefit Catalyst Paper's three mills located in Crofton, Port Alberni and Powell River by funding 75% of the required capital investment on projects that will improve the energy efficiency of these mills. The first project at the Powell River mill is in the advanced stages of planning, has an expected cost of $25 million of which 75% will be covered by Power Smart funding, and will reduce the company's annual energy costs by approximately $5 million.
Catalyst redeemed the US$19.4 million outstanding balance on the Floating Rate Senior Secured Notes due 2016. The company repurchased US$5.0 million of its PIK Toggle Senior Secured Notes due 2017 on the open market.
North American demand decreased from the second quarter of 2013 for all paper grades except uncoated paper. Benchmark prices for coated and uncoated paper declined from the previous quarter while remaining flat for directory and newsprint. For NBSK pulp, the benchmark price decreased by 3.1% compared to Q1 due to short-term destocking in the quarter.
(In millions of Canadian dollars, except
where otherwise stated)
|Operating earnings (loss)||10.9||(3.9)||14.8||(87.8)||(79.5)||4.9||(12.0)||(1.2)|
|Depreciation and amortization||21.9||11.0||10.9||47.0||11.7||11.5||11.4||12.4|
|Adjusted EBITDA 1||32.8||7.1||25.7||46.1||19.1||16.4||(0.6)||11.2|
|- before restructuring costs 1||32.8||7.1||25.7||47.3||20.2||16.4||(0.5)||11.2|
Net earnings (loss) attributable to the
|- before specific items 1||(7.1)||(13.6)||6.5||(31.5)||1.7||(3.5)||(18.1)||(11.6)|
|Adjusted EBITDA margin1||5.9%||2.5%||9.4%||4.4%||7.0%||6.1%||(0.2%)||4.5%|
|- before restructuring costs 1||5.9%||2.5%||9.4%||4.5%||7.4%||6.1%||(0.2%)||4.5%|
Net earnings (loss) per share attributable to
the company's common shareholders
- basic and diluted from continuing
- basic and diluted from discontinued
|- before specific items 1||(0.49)||(0.94)||0.45||(2.17)||0.12||(0.24)||(1.25)||(0.80)|
|(In thousands of tonnes)|
1 Refer to section 6, Non-GAAP measures in Management's Discussion and Analysis (MD&A).
The decline in demand for coated and uncoated mechanical paper is expected to continue for the remainder of the year. Demand for directory paper will continue to decrease due to electronic substitution. While newsprint demand is expected to continue to contract as circulation and page counts fall, the North American market is expected to remain stable due to pending newsprint machine conversions.
Global pulp inventories are very low and this may put upward pressure on future pulp pricing. However, China's seasonally low demand and tight monetary policy are expected to negatively impact the softwood pulp market. Pulp is therefore expected to trade in a narrow range for the balance of the year.
The Power Smart Program will result in improved energy efficiency and will partly mitigate the impact of energy cost rate increases. Discussions will continue with key stakeholders on a suite of potential initiatives to further mitigate the impact of energy rate escalation.
Third quarter earnings will reflect a scheduled total mill outage at Powell River and power boiler shuts at all three mills.
Further Quarterly Results Materials
This release, along with the full annual Management Discussion & Analysis, Financial Statements and accompanying notes are available on our web site at www.catalystpaper.com/Investors. This material 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 three mills, located in British Columbia, Catalyst has a combined annual production capacity of 1.5 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and is ranked by Corporate Knights magazine as one of the 50 Best Corporate Citizens in Canada.
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 contained in Catalyst's annual report for the year ended December 31, 2013 available on the company's website at www.catalystpaper.com/investors and at www.sedar.com.
SOURCE Catalyst Paper Corporation
As organizations shift towards IT-as-a-service models, the need for managing & protecting data residing across physical, virtual, and now cloud environments grows with it. CommVault can ensure protection & E-Discovery of your data - whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise.
Nov. 29, 2015 06:00 PM EST Reads: 230
Today air travel is a minefield of delays, hassles and customer disappointment. Airlines struggle to revitalize the experience. GE and M2Mi will demonstrate practical examples of how IoT solutions are helping airlines bring back personalization, reduce trip time and improve reliability. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Dr. Sarah Cooper, M2Mi’s VP Business Development and Engineering, explored the IoT cloud-based platform technologies driving t...
Nov. 29, 2015 06:00 PM EST Reads: 439
In his General Session at DevOps Summit, Asaf Yigal, Co-Founder & VP of Product at Logz.io, explored the value of Kibana 4 for log analysis and provided a hands-on tutorial on how to set up Kibana 4 and get the most out of Apache log files. He examined three use cases: IT operations, business intelligence, and security and compliance. Asaf Yigal is co-founder and VP of Product at log analytics software company Logz.io. In the past, he was co-founder of social-trading platform Currensee, which...
Nov. 29, 2015 04:00 PM EST Reads: 251
The Internet of Things (IoT) is growing rapidly by extending current technologies, products and networks. By 2020, Cisco estimates there will be 50 billion connected devices. Gartner has forecast revenues of over $300 billion, just to IoT suppliers. Now is the time to figure out how you’ll make money – not just create innovative products. With hundreds of new products and companies jumping into the IoT fray every month, there’s no shortage of innovation. Despite this, McKinsey/VisionMobile data...
Nov. 29, 2015 02:00 PM EST Reads: 485
Just over a week ago I received a long and loud sustained applause for a presentation I delivered at this year’s Cloud Expo in Santa Clara. I was extremely pleased with the turnout and had some very good conversations with many of the attendees. Over the next few days I had many more meaningful conversations and was not only happy with the results but also learned a few new things. Here is everything I learned in those three days distilled into three short points.
Nov. 29, 2015 01:00 PM EST Reads: 352
Culture is the most important ingredient of DevOps. The challenge for most organizations is defining and communicating a vision of beneficial DevOps culture for their organizations, and then facilitating the changes needed to achieve that. Often this comes down to an ability to provide true leadership. As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership ab...
Nov. 29, 2015 01:00 PM EST Reads: 414
DevOps is about increasing efficiency, but nothing is more inefficient than building the same application twice. However, this is a routine occurrence with enterprise applications that need both a rich desktop web interface and strong mobile support. With recent technological advances from Isomorphic Software and others, rich desktop and tuned mobile experiences can now be created with a single codebase – without compromising functionality, performance or usability. In his session at DevOps Su...
Nov. 29, 2015 12:45 PM EST Reads: 419
As organizations realize the scope of the Internet of Things, gaining key insights from Big Data, through the use of advanced analytics, becomes crucial. However, IoT also creates the need for petabyte scale storage of data from millions of devices. A new type of Storage is required which seamlessly integrates robust data analytics with massive scale. These storage systems will act as “smart systems” provide in-place analytics that speed discovery and enable businesses to quickly derive meaningf...
Nov. 29, 2015 12:30 PM EST Reads: 425
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
Nov. 29, 2015 12:00 PM EST Reads: 527
In his General Session at 17th Cloud Expo, Bruce Swann, Senior Product Marketing Manager for Adobe Campaign, explored the key ingredients of cross-channel marketing in a digital world. Learn how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects).
Nov. 29, 2015 11:45 AM EST Reads: 327
The buzz continues for cloud, data analytics and the Internet of Things (IoT) and their collective impact across all industries. But a new conversation is emerging - how do companies use industry disruption and technology enablers to lead in markets undergoing change, uncertainty and ambiguity? Organizations of all sizes need to evolve and transform, often under massive pressure, as industry lines blur and merge and traditional business models are assaulted and turned upside down. In this new da...
Nov. 29, 2015 11:30 AM EST Reads: 275
In recent years, at least 40% of companies using cloud applications have experienced data loss. One of the best prevention against cloud data loss is backing up your cloud data. In his General Session at 17th Cloud Expo, Sam McIntyre, Partner Enablement Specialist at eFolder, presented how organizations can use eFolder Cloudfinder to automate backups of cloud application data. He also demonstrated how easy it is to search and restore cloud application data using Cloudfinder.
Nov. 29, 2015 10:00 AM EST Reads: 203
The Internet of Everything is re-shaping technology trends–moving away from “request/response” architecture to an “always-on” Streaming Web where data is in constant motion and secure, reliable communication is an absolute necessity. As more and more THINGS go online, the challenges that developers will need to address will only increase exponentially. In his session at @ThingsExpo, Todd Greene, Founder & CEO of PubNub, exploreed the current state of IoT connectivity and review key trends and t...
Nov. 29, 2015 09:45 AM EST Reads: 453
Two weeks ago (November 3-5), I attended the Cloud Expo Silicon Valley as a speaker, where I presented on the security and privacy due diligence requirements for cloud solutions. Cloud security is a topical issue for every CIO, CISO, and technology buyer. Decision-makers are always looking for insights on how to mitigate the security risks of implementing and using cloud solutions. Based on the presentation topics covered at the conference, as well as the general discussions heard between sessi...
Nov. 29, 2015 09:15 AM EST Reads: 345
We all know that data growth is exploding and storage budgets are shrinking. Instead of showing you charts on about how much data there is, in his General Session at 17th Cloud Expo, Scott Cleland, Senior Director of Product Marketing at HGST, showed how to capture all of your data in one place. After you have your data under control, you can then analyze it in one place, saving time and resources.
Nov. 29, 2015 08:45 AM EST Reads: 223