Kingsey Falls, Quebec-based Cascades has reported a third-quarter 2020 sales figure that is within 1 percent of the result for the previous quarter and for the third quarter of 2019. The company’s net earnings for the third quarter of 2020, at CA$49 million ($37.26 million), rose by nearly 14 percent compared with the third quarter of last year but fell by 9 percent compared with the previous quarter.
“We are pleased with our consolidated third-quarter results,” states Mario Plourde, president and CEO of Cascades, which produces recycled-content containerboard and tissue paper and operates recycling facilities and downstream packaging plants.
Adds Plourde, “Within an ever-evolving business environment, demand levels for containerboard remained robust. This strength drove higher sequential quarterly sales volume in this business, offsetting higher energy costs and an approximate $3 million impact from unplanned operational shutdowns at our Niagara Falls, New York complex.”
He continues, “Results in our tissue business were mixed. As expected, demand remained strong for consumer tissue, while the reverse was true for away-from-home products given the impact that Covid-19 is having on businesses, restaurants, hotels and schools. This segment, which accounts for approximately 40 percent of our annual tissue sales, experienced sharp decreases in demand for some products.”
Regarding the company’s direction, Plourde remarks, “On the strategic side, we are very pleased to have announced the launch of our Bear Island project in mid-October. This is an important strategic investment for our containerboard business, one which we are confident will benefit operational performance, enhance our product offering in lightweight recycled containerboard and position our containerboard platform for long-term profitable growth within this competitive industry.”
Regarding the outlook for Cascades, Plourde comments, “Demand dynamics in containerboard remain strong, with results expected to also benefit from the announced $50 per short ton price increase beginning in the fourth quarter. In tissue, usual seasonal softness in the fourth quarter and COVID-19 driven demand contraction in the away-from-home product categories are expected to translate into weaker sequential performance. Sequential results in European boxboard are expected to decrease slightly as a result of lack of certainty regarding volume and less favorable mix of products. On a consolidated basis, raw material costs are expected to continue to be favorable for our businesses.”