Robert, not sure if you posted this about lumber industry:
Tuesday July 20, 9:23 pm Eastern Time
Company Press Release
Riverside Forest Products Announces Financial Results for the 3 months Ended June 30, 1999
KELOWNA, BRITISH COLUMBIA--Riverside Forest Products experienced net earnings for the third quarter of fiscal 1999 of $13 million or $1.42 per share compared to a net loss of $2,964,000 or $0.32 per share for the quarter ended June 30, 1998. Net sales for the quarter were $144.8 million compared to $111.2 million for the quarter ended June 30, 1998.
The Company's net earnings for the nine months ended June 30, 1999 was $21.9 million or $2.38 per share compared to a net loss of $14 million or $1.52 per share for the nine months ended June 30, 1998. Earnings before interest, taxes, depreciation and amortization were $68.4 million for the nine months ended June 30, 1999, compared to $5.4 million for the nine months ended June 30, 1998. Net sales were $397.3 million for the nine months ended June 30, 1999 compared to $320.6 million for the same period in 1998.
The Company's sales dollars and volumes for the periods indicated below were as follows:
3 months 6 months 9 months 9 months
ended ended ended ended
June 30, March 31, June 30, June 30,
1999 1999 1999 1998
--------------------------------------------------------------
Sales ($000)
Stud lumber $ 51,936 $ 94,658 $ 146,594 $ 131,248
Dimension lumber 22,858 40,850 63,708 52,594
Plywood 42,784 71,378 114,162 76,406
Veneer 7,468 11,628 19,096 12,116
Wood chips 12,881 27,083 39,964 31,148
Other products 6,878 6,894 13,772 17,125
--------- --------- --------- --------
$ 144,805 $ 252,491 $ 397,296 $ 320,637
--------- --------- --------- --------
--------- --------- --------- --------
Sales volumes
Stud lumber (mfbm) 118,414 229,996 348,410 319,849
Random length lumber
(mfbm) 47,448 95,424 142,872 125,063
Plywood (msf) 106,638 200,955 307,593 238,983
Veneer (msf) 26,812 50,247 77,059 61,335
Wood chips (bdu) 152,503 315,384 467,887 385,665
Net mill sales realizations for lumber and panel products continued to improve through the quarter as consumption in the North American market place outpaced supply for building materials.
During the quarter the Company generated $16.4 million cash from operations, before changes to non-cash working capital, compared to utilizing $2.8 million for the same quarter a year ago. This brings the cash generated from operations, before changes to non-cash working capital, for the nine months ended June 30, 1999 to $50.2 million compared to $6.6 million for the same period in 1998. The Company spent $3.0 million on capital additions bringing total capital expenditures for the year to date to $6.2 million.
Consistent with the Company's strategy of strengthening and ''recession proofing'' the balance sheet when profitability dictates, long term debt was reduced to US $82 million (approximately $121 million Canadian) on May 27, 1999 when the Company made a prepayment of US $20 million. The prepayment included a prepayment penalty of approximately US $650,000 and a realized foreign exchange loss of $2 million, which have been included in interest expense for the quarter. The first payment on the debt in the amount of US $3.5 million will now be due May 30, 2001. The Company also negotiated a two-year committed revolving loan facility to a maximum of US $25 million, available for the period from May 27, 1999 to June 30, 2001.
Working capital as at June 30, 1999 amounts to $94.2 million compared to $72.9 million as at June 30, 1998. Shareholders' equity amounts to $152.7 million, which is equivalent to $16.60 per share ($124.7 million and $13.55 book value per share for the respective period in the last fiscal year). The ratio of long-term debt to long-term debt plus equity is 44.2 percent (52.9 percent at June 30, 1998).
The Company has adopted a shareholder rights plan in order to address the Board's concern that in the context of an unsolicited takeover bid, Canadian securities legislation does not assure fair treatment of shareholders or allow sufficient time for shareholders and the Board to consider the bid fully or for the Board to seek alternatives to the bid, if appropriate. The rights plan, which is effective immediately for a term of 10 years, is subject to shareholder ratification at the Company's next annual general meeting and every three years thereafter. The plan has not been adopted in response to an anticipated takeover bid, but as a general planning measure. A complete copy of the plan is available from the Company on request.
As a result of four straight quarters of positive earnings for the period ended June 30, 1999, being $28 million or $3.05 per share, the Board of Directors has decided to re-instate the payment of dividends. Accordingly the Board of Directors has declared a quarterly dividend of $0.06 per share on the common shares of the Company payable August 10, 1999 to shareholders of record August 2, 1999.
The current strength of the lumber and plywood markets in North America is expected to continue through the quarter. Strong demand for our products in North America and improvements in Japanese consumption will provide excellent trading opportunities.
Gordon W. Steele, Chairman, President and Chief Executive Officer
Kelowna, B.C., July, 1999
Riverside Forest Products Limited
Consolidated Statement of Earnings
(in thousands of dollars) Unaudited
--------------------------------------------------------------
3 months ended June 30 9 months ended June 30
1999 1998 1999 1998
----------- ---------- ---------- --------
Net Sales $ 144,805 $ 111,188 $ 397,296 $ 320,637
Cost of products
Sold 108,647 104,384 320,644 308,308
Selling and
Administration 5,143 3,200 12,761 9,635
Other income (1,464) (876) (4,464) (2,748)
---------------------------------------------
Earnings before
interest, taxes,
depreciation and
amortization 32,479 4,480 68,355 5,442
Depreciation and
Amortization 6,154 5,794 18,611 17,709
Amortization of
unrealized
foreign exchange
loss (1,800) - (600) -
Interest on long
term debt 5,884 2,756 12,188 8,268
------------------------------------------
Earnings (loss)
before income taxes 22,241 (4,070) 38,156 (20,535)
Income taxes
(recoverable) 9,235 (1,106) 16,280 (6,531)
------------------------------------------
Net Earnings (Loss)$ 13,006 $ (2,964) $ 21,876 $ (14,004)
------------------------------------------
Number of common
shares outstanding 9,199,493 9,199,493 9,199,493 9,199,493
Net Earnings (loss)
per common share $ 1.42 $ (0.32) $ 2.38 $ (1.52)
------------------------------------------
------------------------------------------
Consolidated Balance Sheet
As at June 30
--------------------------------------------------------------
(in thousands of dollars) Unaudited
1999 1998
------------------------------
Assets
Current assets $ 166,437 $ 122,971
Long-term investments 1,137 2,219
Capital assets 199,862 215,118
Deferred unrealized foreign
exchange loss 5,969 -
Deferred financing costs 2,714 2,473
------------------------------
$ 376,119 $ 342,781
------------------------------
Liabilities
Current liabilities $ 72,285 $ 50,099
Reforestation obligation 10,839 15,808
Long-term debt 120,868 139,944
Other long-term liabilities 4,036 4,066
Deferred income taxes 15,361 8,168
Shareholders' equity 152,730 124,696
------------------------------
$ 376,119 $ 342,781
------------------------------
------------------------------
Consolidated Statement of Changes in Financial Position
(in thousands of dollars) Unaudited
--------------------------------------------------------------
3 months ended June 30 9 months ended June 30
1999 1998 1999 1998
---------------------------------------------
Funds Provided by (Used for)
Operations
Net earnings
(loss) $ 13,006 $ (2,964) $ 21,876 $ (14,004)
Items not
involving
cash
Depreciation
and
amortization 4,354 5,794 18,011 17,709
---------------------------------------------
17,360 2,830 39,887 3,705
Gain on disposal
of capital
assets (2) (37) (39) (146)
Deferred income
Taxes 975 (3,470) 5,797 (1,010)
Change in
reforestation
obligation (1,918) (2,122) 4,548 4,095
----------------------------------------------
16,415 (2,799) 50,193 6,644
Change in non-
cash operating
working capital 22,732 11,978 6,089 (119)
----------------------------------------------
39,147 9,179 56,282 6,525
----------------------------------------------
Per common
share (in
dollars) $ 4.26 $ 1.00 $ 6.12 $ 0.71
----------------------------------------------
Financing
Repayment of
long-term debt (27,440) - (27,440) -
Change in other
long-term
liabilities 269 316 (187) 466
Dividends - - - (368)
----------------------------------------------
(27,171) 316 (27,627) 98
----------------------------------------------
Investment
Change in
Investments - 127 (1) 56
Proceeds on
disposal of
capital assets 335 79 371 258
Additions to
capital assets (2,964) (3,300) (6,170) (10,271)
Increase in
deferred
financing costs (834) - (985) -
----------------------------------------------
(3,463) (3,094) (6,785) (9,957)
----------------------------------------------
Change in Cash
Position 8,513 6,401 21,870 (3,334)
Cash Position,
beginning of
Period 56,689 9,885 43,332 19,620
----------------------------------------------
Cash Position,
end of Period $ 65,202 $ 16,286 $ 65,202 $ 16,286
Contact:
Riverside Forest Products Limited
Gordon W. Steele
Chairman, President and Chief Executive Officer
(250) 762-3411
(250) 762-6888
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