MONTRÉAL – Resolute Forest Products reported a net loss for the quarter ended June 30, 2017, of US$74 million, compared to a net loss of US$42 million in the same period in 2016. Sales were US$858 million in the quarter, down $33 million, or four per cent, from the second quarter of 2016. Excluding special items, the company reported a net loss of US$3 million compared to net income, excluding special items, of $2 million in the second quarter of 2016.
“This quarter’s performance was a clear improvement from the first quarter,” said Richard Garneau, president and chief executive officer. “The results of our wood products segment were strong given higher prices associated with the U.S. imposition of trade barriers, while our market pulp segment recorded a solid performance despite production curtailments associated with annual outages. In tissue, the improvement in our profitability continued but remained short of expectations. Paper segments continued to be impacted by adverse market conditions, particularly in specialty grades.”
The company recorded an operating loss of US$47 million in the quarter, compared to an operating loss of US$6 million in the first quarter of 2017, while adjusted EBITDA increased by US$22 million over the same period, to US$83 million.
The company’s operating results were positively impacted by overall increases in pricing, particularly in the wood products and market pulp segments.
The wood products segment recorded operating income of US$45 million for the quarter, an improvement of US$25 million against the previous quarter. Despite market unpredictability from the imposition of countervailing and anti-dumping duties in the quarter, shipments increased, reaching 509 million board feet, the company reports. The average transaction price rose by US$36 per thousand board feet to US$386. The delivered cost went down by US$11 per thousand board feet, mostly resulting from improved log yields and better efficiency.
Garneau added: “Now that the uncertainty surrounding trade duties in lumber has started to dissipate, we expect market conditions to remain favorable.”