West Fraser ("WFT") Announces First Quarter Results
(firmenpresse) - VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 04/30/12 -- West Fraser Timber Co. Ltd. (TSX: WFT) today reported a loss of $17 million or $0.39 per share on sales of $681 million in the first quarter of 2012. These results compare with previous periods as follows:
Operational Results
In the quarter our lumber operations generated an operating loss of $29 million and EBITDA of negative $6 million. The improvement over the prior quarter was smaller than anticipated due to continued weakness in offshore prices for low-grade SPF lumber.
The panel segment, which includes plywood, LVL and MDF, generated $1 million of operating earnings and EBITDA of $5 million in the quarter, a marginal increase over the prior quarter.
Pulp and paper operations generated operating earnings in the quarter of $17 million and EBITDA of $30 million. The improvement over the prior quarter occurred despite the decline in pulp prices as the previous quarter's results were negatively affected by the Hinton Pulp maintenance shutdown.
Outlook
Low-grade SPF lumber prices strengthened late in the quarter returning to a more normalized level compared to the SPF 2&Better benchmark price. Lumber productivity and cost improvements are expected to be realized over the next few quarters as various major capital projects are completed.
Hank Ketcham said, "Although there are some improvements in our markets, we will continue to monitor capital spending and focus on maintaining a strong balance sheet as the North American and Asian economies remain fragile."
Management's Discussion & Analysis ("MD&A")
The Company's MD&A is available on the Company's website: and on the System for Electronic Document Analysis and Retrieval at under the Company's profile.
Normal Course Issuer Bid
The Company announced on May 20, 2011 a normal course issuer bid ("NCIB") under which it is authorized to acquire up to 2,002,879 Common shares for cancellation from June 1, 2011 until expiry of the bid on May 31, 2012. To date, no Common shares have been acquired under this NCIB. The Company announces that it intends to apply to the Toronto Stock Exchange (the "TSX") for approval to renew the NCIB for another year to purchase for cancellation up to 5% of its issued and outstanding Common shares. The renewal of the NCIB is subject to TSX approval and, if approved, will be conducted in accordance with the TSX rules. Full details of the renewed NCIB will be announced upon receipt of TSX approval.
The Company
West Fraser is an integrated wood products company producing lumber, wood chips, LVL, MDF, plywood, pulp and newsprint. The Company has operations in western Canada and the southern United States.
Forward-Looking Statements
This news release contains historical information, descriptions of current circumstances and statements about potential future developments. The latter, which are forward-looking statements and are included under the heading "Outlook", are presented to provide reasonable guidance to the reader but their accuracy depends on a number of assumptions and is subject to various risks and uncertainties. Actual outcomes and results will depend on a number of factors that could affect the ability of the Company to execute its business plans, including those matters described in the 2011 annual Management's Discussion & Analysis under "Risks and Uncertainties", and may differ materially from those anticipated or projected. Accordingly, readers should exercise caution in relying upon forward-looking statements and the Company undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, except as required by applicable securities laws.
Conference Call
Investors are invited to listen to the quarterly conference call on Tuesday, May 1, 2012 at 8:30 a.m. Pacific Time (11:30 a.m. Eastern Time) by dialing 1-800-952-6845 (toll-free North America). The call may also be accessed through West Fraser's website at .
West Fraser shares trade on the Toronto Stock Exchange under the symbol: "WFT".
West Fraser Timber Co. Ltd.
Notes to Condensed Consolidated Interim Financial Statements
(figures are in millions of dollars except where indicated - unaudited)
1. Nature of operations
West Fraser is an integrated wood products company producing lumber, wood chips, LVL, MDF, plywood, pulp and newsprint and is listed on the Toronto Stock Exchange under the symbol WFT. Its executive office is located at 858 Beatty Street, Suite 501, Vancouver, British Columbia. The Company was formed by articles of amalgamation under the Business Corporations Act (British Columbia) and is registered in British Columbia, Canada.
2. Basis of presentation and statement of compliance
These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting as issued by the International Accounting Standards Board and using the same accounting policies and methods of their application as the December 31, 2011 annual financial statements. These condensed consolidated interim financial statements should be read in conjunction with the Company's 2011 annual financial statements.
3. Inventories
Inventories at March 31, 2012 were written down by $19.8 million (December 31, 2011 - $14.9 million; March 31, 2011 - $3.9 million) to reflect net realizable value being lower than cost.
4. Long-term debt and operating loans
Long-term debt
Operating loans
The Company has $530 million in revolving lines of credit, of which $51.2 million (net of deferred charges of $5.4 million) was drawn as at March 31, 2012 (December 31, 2011 - nil). Deferred financing costs of $5.7 million are included in other assets at December 31, 2011. As at March 31, 2012, letters of credit in the amount of $35.3 million have been issued under these facilities.
The $500 million committed facility, the $25 million demand line of credit dedicated to letters of credit facility and the US$300 million senior notes are secured by the Company's assets. A $5 million line of credit, which is available to a joint venture, is secured by the joint venture's current assets.
5. Other liabilities
6. Employee future benefits
The Company maintains defined benefit and defined contribution pension plans covering a majority of its employees. The defined benefit plans provide pension benefits based either on length of service or on earnings and length of service. Total pension expense for the defined benefit plans is $9.0 million for the three months ended March 31, 2012 (three months ended March 31, 2011 - $8.4 million). The Company also provides group life insurance, medical and extended health benefits to certain employee groups.
The status of the defined benefit pension plans and other benefit plans, in aggregate, is as follows:
The significant assumptions used to determine the period end benefit obligations are as follows:
The change in the discount rate on obligations and the difference between the actual rate of return and the expected rate of return on plan assets generated an actuarial gain (loss) on employee future benefits, included in comprehensive earnings, as follows:
7. Other income (expense)
8. Tax provision
The Company's effective tax rate on earnings from continuing operations is as follows:
9. Discontinued operation
The Company permanently closed its linerboard and kraft paper mill, located in Kitimat, B.C. in January 2010 and the windup was substantially completed in December 2011.
10. Earnings per share
Basic earnings per share is calculated based on earnings available to Common shareholders, as set out below, using the weighted average number of Common shares and Class B Common shares outstanding.
Diluted earnings per share is calculated based on earnings available to Common shareholders adjusted to remove the actual share option expense (recovery) charged to earnings and after deducting a notional charge for share option expense assuming the use of the equity settled method, as set out below. The diluted weighted average number of shares is calculated using the treasury stock method. When earnings available to Common shareholders for diluted earnings per share are greater than earnings available to Common shareholders for basic earnings per share, the calculation is anti-dilutive and diluted earnings per share are deemed to be the same as basic earnings per share.
11. Green Transformation Program
In 2009 the Government of Canada confirmed an allocation of credits totalling $88 million to the Company under the Pulp and Paper Green Transformation Program (the "GT Program"). The GT Program provides funding for capital projects that improve the energy efficiency or environmental performance of Canadian pulp and paper mills. Credits may be used until the GT Program end date of March 31, 2012. For the three months ended March 31, 2012, the Company received $15.6 million under the GT Program (year ended December 31, 2011 - $36.9 million; year ended December 31, 2010 - $1.6 million). At March 31, 2012, $34.3 million is included in accounts receivable related to expenditures under the GT Program.
12. Segmented information
The geographic distribution of external sales is as follows:
13. Contingency
On January 18, 2011 the United States initiated arbitration with Canada under the Softwood Lumber Agreement ("SLA") over its concern that the province of British Columbia ("B.C.") has misapplied or altered its timber pricing rules and as a result has charged too low a price for certain timber harvested on public lands in the B.C. interior. In August 2011 the United States filed a detailed statement of case with the arbitration panel and the parties exchanged pleadings in the fourth quarter of 2011. A hearing before the arbitration panel took place in February 2012 and a final decision is expected in the second half of 2012.
The Company believes that Canada and B.C. are complying with their obligations under the SLA and intends to cooperate fully with the B.C. and Canadian governments in defending this claim. The results of the arbitration process are not determinable at this point in time and accordingly no provision has been recorded by the Company.
Contacts:
West Fraser Timber Co. Ltd.
Larry Hughes
Vice President, Finance and Chief Financial Officer
(604) 895-2700
West Fraser Timber Co. Ltd.
Rodger Hutchinson
Vice President, Corporate Controller
(604) 895-2700
(604) 681-6061 (FAX)
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Datum: 30.04.2012 - 15:01 Uhr
Sprache: Deutsch
News-ID 1108731
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Forest and Paper Products
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