Cascades Inc. a manufacturer of green packaging and tissue paper products, disclosed its unaudited financial results for the three month period ended March 31, 2014.
Mario Plourde, president and chief executive officer, commented, “Exceptionally harsh weather conditions in North America resulted in higher operating costs and lower shipments. Compared to the last quarter, these factors negatively impacted our first quarter results which represent, nevertheless, an 18 percent EBITDA improvement compared to the same period last year.
“Sequentially, all our North American groups are showing lower results. The Containerboard Group suffered from a 14 day interruption of operations at its Trenton mill as a result of an equipment failure. The Specialty Products Group incurred higher energy and raw material costs. As for the Tissue Papers Group, it was also impacted by a more competitive market and a decrease in volumes in the away-from-home market and retail in Canada. On the positive side, results for the Boxboard Europe Group improved over the last quarter due to higher shipments and energy credits amounting to $5 million during the first quarter. Finally, the productivity of the Greenpac mill continues to improve gradually and produced to capacity for a few days in April.”
Plourde added, “Despite the shortfall in the results for the first quarter, we are still confident in our ability to do better this year than we did in 2013. The recent decrease of recycled fibre costs confirms our views that input costs should remain reasonable. Aside from Europe where the competitive environment is expected to be challenging for recovered grades, our Packaging Products activities should continue to improve. In the tissue sector, we will face headwinds caused by additional capacity and lower demand from major retailers in the U.S.
“Finally, our debt to EBITDA ratio remained relatively stable during the quarter despite a weak Canadian dollar environment and seasonal working capital requirements and should continue to improve during the course of the year.”
In comparison with the same period last year, sales increased by 4 percent to $994 million as favorable exchange rates and higher average selling prices, particularly in the Containerboard Group, more than offset lower volumes for the Tissue Papers Group. Operating income, excluding specific items, increased from $24 million in Q1 2013 to $34 million in the first quarter of 2014.
Net earnings excluding specific items amounted to $1 million ($0.01 per share) in the first quarter of 2014 compared to a net loss of $4 million ($0.04 per share) for the same period in 2013. Including specific items, the net loss amounted to $1 million ($0.01 per share) in the first quarter of 2014 compared to a net loss of $8 million ($0.09 per share) in the same quarter in 2013.
Published in the June 2014 Edition of American Recycler News