Abitibi-Consolidated Reports First Quarter Earnings

Abitibi-Consolidated Inc. reported first quarter net earnings of $181 million, compared to a loss of $50 million the same quarter of 2002.

The first quarter operating loss from continuing operations was $35 million compared to an operating profit from continuing operations of $41 million for the same period last year.

"Despite the pressures on both paper and lumber markets in the first quarter, the company's newsprint prices continued moving back towards normalized levels," said John Weaver, president and CEO. "The successful implementation of our recent newsprint price increase is evidence that supply and demand are coming back into proper balance. What is required now is less uncertainty in the global economy."

North American demand for newsprint continued its positive trend established at year-end 2002, increasing by 5 percent in the first two months of 2003 compared to the same period of 2002, according to the Pulp and Paper Products Council

According to the PPPC, at the end of February 2003, total producer and customer newsprint inventories were 16,000 metric tons higher than at the end of February 2002. The company's inventories rose by 66,000 metric tons in the first quarter of 2003 compared to the end of 2002 essentially due to an increase in inventory destined to international markets, of which 35,000 metric tons was not shipped as a result of logistical problems due to adverse weather conditions and the war in Iraq. Inventories destined to North American customers remained constant and at historically low levels.