Cascades Inc. reported net earnings of $4 million for the third quarter, compared to net earnings of $34 million for the same period in 2002.
The company cited the sharp increase in the Canadian dollar against the U.S. dollar as a key reason for the drop in earnings.
Additionally, the company noted that generally weak global demand for its paper and packaging products worldwide caused the sharp drop in earnings.
Net sales decreased by 9 percent during the third quarter to $792 million compared to $874 million for the same period last year. Operating income stands at $31 million for the quarter, compared to $74 million a year earlier, a 58 percent decrease.
Net earnings for the first nine months were $49 million, compared with net earnings of $129 million the same time last year.
Alain Lemaire, president and CEO of Cascades, stated: "The continuous and rapid appreciation of the Canadian dollar, combined with weak global demand for paper and packaging products pose a great challenge. Although a slow economy may translate into certain advantages, such as lower recycled fiber demand and prices, these advantages do not entirely offset the lack of pricing power in most of our markets. Confronted with this reality, we are taking the steps we deem necessary to maintain our long-term competitiveness in our core operations."Latest from Recycling Today
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