Repap Wisconsin, Inc. Reports Second Quarter Results
MONTREAL, July 28 /PRNewswire/ -- Repap Wisconsin Inc. today reported results for the
quarter ended June 30, 1997. Repap Wisconsin recorded a net loss of $21.2 million in the second
quarter of 1997, compared with a net loss of $2.2 million in the second quarter of 1996. The second
quarter of 1997 includes a $34.8 million non-cash provision in cost of sales relating to the write-off
of pulp receivables due from Skeena Cellulose Inc. and from Repap's Atholville pulp mill, both of
which have discontinued pulp production.
Revenues were $126.8 million, up 11 percent from $114.0 million realized in the second quarter of
1996. Higher volumes and substantially lower paper production costs more than offset the
unfavourable impact of lower paper prices resulting in an operating margin before the pulp provision
of $19.2 million in the second quarter of 1997, compared with $13.4 million in the second quarter of
1996. Compared with the first quarter of 1997, Repap Wisconsin's second quarter operating margin
before the pulp provision was up $6.0 million or 45 percent, reflecting primarily lower coated paper
production costs combined with higher prices and volumes.
Repap Wisconsin generated free cash flow from operations of $9.9 million in the second quarter of
1997. A reduction in working capital of $13.6 million resulted in cash flow from operations after
working capital changes of $23.5 million.
Repap Enterprises Inc. recently announced the planned sale of Repap USA Inc., of which Repap
Wisconsin is a subsidiary, to Consolidated Papers, Inc. of Wisconsin Rapids, Wisconsin. Repap
today announced that it has decided to submit the planned sale to the vote of its shareholders. It is
expected that the vote will be held at a special shareholders meeting in late September.
Commenting on the outlook, George S. Petty, Chairman and Chief Executive Officer, said, ``Coated
paper markets remain strong, with United States industry shipments for the first half of 1997 up
approximately 18 percent compared with 1996. Repap Wisconsin realized a record volume for a
second quarter, with coated paper shipments up 27 percent over the second quarter of 1996 and up
seven percent over a strong first quarter. Producer and consumer inventories appear to be in balance
and overall markets in equilibrium as we move into the seasonally strong third quarter.''
REPAP WISCONSIN, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions of U.S. dollars)
Quarter Ended
Jun. 30 Mar. 31 Jun. 30 Yr Over Yr Qtr Over Qtr
1996 1997 1997 % Change % Change
Revenues $ 114.0 $ 116.8 $ 126.8 11% 9%
Net sales 104.0 105.4 114.7 10% 9%
Cost of sales 85.0 86.5 90.0
Provision for loss
on pulp deals (1) --- --- 34.8
Selling, administra-
tive and research 5.6 5.7 5.5
Operating margin 13.4 13.2 (15.6) -216% -218%
Depreciation &
amortization 6.0 5.8 5.9
Operating profit 7.4 7.4 (21.5)
Interest expense
and amortization
of financing fees 10.3 10.3 10.3
Other expenses
(income) (0.2) --- (0.1)
Pre-tax income (loss) (2.7) (2.9) (31.7)
Provision for income
taxes (0.5) (0.9) (10.5)
Extraordinary loss
(gain) --- --- ---
Net income (loss) $ (2.2) $ (2.0) $ (21.2)
EBITDA (2) $ 14.0 $ 13.7 $ 19.8 41% 45%
Revolving credit
facility (period
end) $ 50.5 $ 53.6 $ 31.8
Capital expenditures $ 1.8 $ 3.1 $ 1.8
Cash from operations
before working
capital changes $ 4.1 $ 4.1 $ 9.9
Non-cash working
capital changes $ 6.4 $ (17.0) $ 13.6
Coated paper shipments
(000 tons) 109 129 138 27% 7%
REPAP WISCONSIN, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions of U.S. dollars)
Six Months Ended
Jun. 30 Jun. 30
1997 1997 % Change
Revenues $ 211.5 $ 243.6 15%
Net sales 193.3 220.1 14%
Cost of sales 157.3 176.5
Provision for loss
on pulp deals (1) --- 34.8
Selling, administra-
tive and research 11.2 11.2
Operating margin 24.8 (2.4) -110%
Depreciation &
amortization 11.4 11.7
Operating profit 13.4 (14.1)
Interest expense
and amortization
of financing fees 20.8 20.6
Other expenses
(income) (0.2) (0.1)
Pre-tax income (loss) (7.2) (34.6)
Provision for income
taxes (1.8) (11.4)
Extraordinary loss
(gain) --- ---
Net income (loss) $ (5.4) $ (23.2)
EBITDA (2) $ 25.7 $ 33.5
Revolving credit
facility (period
end) $ 50.5 $ 31.8
Capital expenditures $ 4.8 $ 4.9
Cash from operations
before working
capital changes $ 5.8 $ 14.0
Non-cash working
capital changes $ (14.5) $ (3.4)
Coated paper shipments
(000 tons) 193 267 38%
(1) Write-off of pulp receivables due from Skeena Cellulose Inc. and from Repap's Atholville
pulp mill, both of which have discontinued pulp production.
(2) EBITDA = Operating profit plus depreciation and amortization and the non-cash portion
of the charge for post-retirement benefits costs
(FASB 106)
SOURCE: Repap Wisconsin Inc.
Contact: Stephen C. Larson, President & COO, 514-846-1316, or Kathleen V. Cornish, Vice-President, Investor
Relations, 514-846-6220, both of Repap Wisconsin Inc. |
