DGAP-News: FORTRESS PAPER ANNOUNCES FIRST QUARTER 2010 RESULTS
(firmenpresse) - Fortress Paper Ltd. / Quarter Results
12.05.2010 11:24
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ForFor Immediate Release
For Immediate Release
FORTRESS PAPER ANNOUNCES FIRST QUARTER 2010 RESULTS
Vancouver, British Columbia, May 11, 2010 - couver, British Columbia,
May 11, 2010 - Fortress Paper Ltd. ('Fortress Paper' or the 'Company')
reported adjusted net income of $3.0 million for the first quarter of 2010
on sales of $50.3 million or adjusted earnings per share of $0.30. In the
first quarter of 2009 the Company reported adjusted net income of $2.5
million on sales of $46.6 million or adjusted earnings per share of $0.25.
For the fourth quarter of 2009 the Company reported adjusted net income of
$4.8 million on sales of $51.0 million or adjusted earnings per share of
$0.47.
Analysis of Specific Items Affecting Comparability of Net Income
(thousands of dollars, except per share figures,unaudited)EBITDA was $5.8 million or 11.5% of sales for the three months ended March
Q1 2010 Q4 2009 Q1 2009
Net income as reported 179 3,720 3,584
Foreign exchange loss 2,380 1,073 (1,055)
(gain)
Deferred expenses 476 - -
written off
Adjusted net income 3,035 4,793 2,529
Net income per share 0.02 0.35 0.35
(EPS), as reported
Impact of above item 0.28 0.12 (0.10)
per share
Adjusted net income per 0.30 0.47 0.25
share
31, 2010. For the three months ended March 31, 2009 EBITDA was $5.0
million or 10.8% of sales. EBITDA was $7.9 million or 15.4% of sales for
the three months ended December 31, 2009.
In the first quarter of 2010 the Dresden mill continued to experience
strong sales and earnings throughout the quarter. The Landqart mill
results reflected the product mix during the quarter. The banknote paper
machine remains full and the conversion of paper machine one from a
specialty paper machine to a banknote paper machine is on track. The
increase in EBITDA relative to the prior year comparative period was
partially due to the global financial and economic crisis which impacted
sales early in 2009.
EBITDA is defined as net income before interest, income taxes,
depreciation, amortization, non-operating income and expenses and stock
based compensation which the Company considers to be a key performance
indicator. EBITDA is not a generally accepted earnings measure and should
not be considered as an alternative to earnings or cash flows as determined
in accordance with Canadian generally accepted accounting principles. As
there is no standardized method of calculating EBITDA, the Company's use
for the term may not be comparable with similarly titled measures used by
other companies.
Chadwick Wasilenkoff, chief executive officer of Fortress Paper, states:
'This is an exciting time for the Company. The recently announced
acquisition of the Thurso mill will diversify our specialty product mix and
we believe will provide a significant financial contribution to Fortress's
growth aspirations. We plan to ramp up operations at the Thurso mill while
we immediately begin the conversion into a dissolving pulp operation. The
Dresden mill continues to perform extremely well, while the Landqart mill
is experiencing results which are reflective of the current product mix of
banknotes which offer lower margins.'
SelSelected Financial Information
ected Financial Information
The selected financial information presented herein is qualified in its
entirety by, and should be read in conjunction with, our audited
consolidated financial statements as at and for the year ended December 31,
2009 and the related notes thereon and our Management's Discussion and
Analysis filed on SEDAR.
Three Months Ended March 31, 2010
Selected Financial Information and Statistics
(thousands of dollars, except per share figures,unaudited)Operational Results
Q1 2010 Q4 2009 Q1 2009
Sales 50,304 51,049 46,623
EBITDA 5,808 7,885 5,032
Operating income 4,202 6,292 3,765
Net income 179 3,720 3,584
Basic EPS $0.02 $0.36 $0.35
Weighted average shares 10,234 10,234 10,234
outstanding basic
(thousands)
Diluted EPS $0.02 $0.35 $0.35
Weighted average shares 10,713 10,487 10,234
outstanding diluted
(thousands)
Shipments (tonnes)
Landqart mill 4,287 3,673 3,721
Dresden mill 12,099 11,618 9,002
Total 16,386 15,291 12,723
Landqart produces various security and specialty papers. Security paper
production includes banknote paper which results in varying degrees of
EBITDA margin depending on the complexity of the features included. During
2008 Landqart also started producing non-woven wallpaper base. Included in
Landqart's sales number for the quarter ended March 31, 2010 is
approximately 1,581 tonnes of non-woven wallpaper base. At the Landqart
mill the order log for security papers remains stable.
At the Dresden mill, the wallpaper base market experienced continued
strength throughout the quarter. Sales tonnage has increased relative to
the prior year comparative periods and profitability remains solid.
Subsequent Events
On April 30, 2010 the Company completed the purchase of a northern bleached
hardwood kraft pulp mill located in Thurso, Quebec from Fraser Papers Inc.
through a wholly-owned subsidiary, Fortress Specialty Cellulose Inc.
('Fortress Specialty Cellulose'), for the net proceeds of approximately
$1.2 million. The Company has announced the intention of converting this
mill into a specialty cellulose (dissolving pulp) operation and to build a
biomass-based cogeneration plant. The valuation of this acquisition for
accounting purposes and the effect on the financial statements of the
Company are still being determined.
Concurrent with this acquisition the Company finalized $102.4 million in
project financing with a term of 10 years secured by the assets of Fortress
Specialty Cellulose. Interest will be calculated at a fixed rate of 5.0%
per annum for the first five years, followed by a rate of up to 5.5% for
the remaining 5 years.
Also concurrent with this acquisition Fortress Paper issued a $15 million
convertible debenture to a financial institution. The convertible debt
matures in five years with an interest rate of 7% per annum. The debenture
is convertible, in whole or in part, at the option of the holder into
common shares of Fortress Paper at any time at a conversion price equal to
$20.00 per share. Fortress Paper can redeem the debenture, in whole or in
part, at any point after two years at a conversion price of not less than
$25.00 per share.
The Company
Fortress Paper is a leading international producer of security and other
specialty papers. The Company operates two paper mills, the Landqart mill
located in Switzerland and the Dresden mill located in Germany. The
Company's security papers include banknote, passport and visa papers and
its specialty papers include non-woven wallpaper base products, and graphic
and technical papers. As an extension of its security papers business, the
Landqart mill has been actively developing and marketing innovative
paper-based security products.
Conference Call
A conference call to discuss the financial results for the first quarter
2010 will be held on May 12, 2010 at 8:00 a.m. (PST). To attend the
conference call, please dial one of the following numbers:
North America: 1-877-353-9586
International: 1-403-532-8075
Participant pass code: 90198#
A replay of the conference call will be available for 7 days. To access the
replay, listeners may dial 1-877-245-4531 from North America or
403-205-4531 International. The pass code to access the replay is 347381#.
Forward-Looking Statements
Some information in this news release contains forward-looking statements
that reflect the current views and/or expectations of the Company with
respect to its performance, business and future events, including its
intention to convert the Thurso Mill into a specialty cellulose (dissolving
pulp) operation; its plans to build a biomass based cogeneration plan; and
the anticipated results. Forward-looking statements are not guarantees of
future performance and involve risks, uncertainties and assumptions which
are difficult to predict. Investors are cautioned that all forward-looking
statements involve risks and uncertainties including, without limitation,
that the Corporation will not obtain the necessary financing to complete
its business plan in respect of the Thurso Mill; that it will be unable to
implement its business plan in respect of the Thurso Mill as planned or at
all; that the specialty cellulose operation and cogeneration plant will not
be successful or profitable; and those risks relating to changes in the
market, potential downturns in economic conditions, fluctuations in the
price and supply of raw materials, foreign exchange fluctuations, labour
relations, regulatory requirements, reputation, competition, dependence on
major customers, and other risk factors listed from time to time in the
Corporation's public filings. These risks, as well as others, could cause
actual results and events to vary significantly. Accordingly, readers
should not place undue reliance on forward-looking statements and
information, which are qualified in their entirety by this cautionary
statement. Fortress Paper does not undertake any obligations to release
publicly any revisions for updating any voluntary forward-looking
statements, except as required by applicable securities law.
For further information please contact:
Mr. Chadwick Wasilenkoff, Chief Executive Officer
Fortress Paper Ltd.
604-904-2328 (info(at)fortresspaper.com)
Not for distribution to United States newswire services or for
dissemination in the United States.
12.05.2010 11:24 Ad hoc announcement, Financial News and Media Release distributed by DGAP. Medienarchiv atwww.dgap-medientreff.deandwww.dgap.de---------------------------------------------------------------------------Unternehmensinformation / Kurzprofil:
Datum: 12.05.2010 - 11:24 Uhr
Sprache: Deutsch
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