Smurfit-Stone Reports Steep Drop
Smurfit-Stone Container Corp. reported net income available to common shareholders of $14 million for the fourth quarter, compared to net income of $67 million in the fourth quarter of 2000. Sales for the period were $1.991 billion compared to $2.242 billion in the fourth quarter of 2000.
For the full year, the company reported net income available to common shareholders of $66 million, compared to net income of $224 million in 2000. Sales for the full year were $8.377 billion compared to $8.796 billion in 2000. Smurfit-Stone's sales and earnings include the results of St. Laurent Paperboard Inc. since June 1, 2000.
Patrick Moore, president and CEO, said that the decline in earnings from the year ago fourth quarter and the third quarter of 2001 primarily reflected continued sluggish demand for packaging and price weakness. Smurfit-Stone's North American corrugated container shipments fell by 2.5 percent in the fourth quarter and were down 5.4 percent compared to the fourth quarter of last year.
During the quarter, the company took 287,000 tons of economic downtime in its containerboard mill system to reduce inventory and manage working capital, as well as 53,000 tons of maintenance downtime. On the positive side, energy costs and interest expense declined in the fourth quarter, relative to the third quarter.
Commenting on full year results, Moore said, ``Given the weak demand for containerboard and corrugated containers, Smurfit-Stone performed well. We recognized early that 2001 would be a difficult year for the packaging business, and we reacted aggressively. We reduced capital spending, and we successfully controlled operating and administrative costs. As a result, we exceeded our cash flow expectations.''
Bowater Reports Income Decline for Quarter
Bowater Inc. reported financial results for the fourth quarter and full year. Net income for the fourth quarter was $18.7 million on sales of $700.3 million. These results compare with net income of $58.5 million on sales of $657.9 million in the fourth quarter of 2000.
For the full year, Bowater had net income of $73.2 million, which includes $69.4 million gain relating to asset sales and $10.3 million resulting from foreign currency gains. This compares with net income of $159.4 million in 2000.
``Our poor financial results reflect the worst industry conditions in decades. The unprecedented decline in advertising expenditures for the print media during 2001 had a major impact on demand and pricing levels for our company's paper products,'' said Arnold Nemirow, chairman, president and CEO.
During the fourth quarter, the company's average newsprint price declined by 10 percent, as compared with the third quarter, while average coated groundwood paper prices declined by 5 percent. Market pulp pricing improved slightly from the third quarter to the fourth quarter, while the average selling price for lumber fell significantly, primarily due to duties relating to shipments of Canadian lumber into the U.S.
In the fourth quarter, Bowater curtailed newsprint and market pulp production by about 110,000 metric tons and 28,000 metric tons, respectively. In anticipation of continued weakness in demand, Bowater will have a similar operating rate for newsprint in the first quarter.
Last month, Bowater completed a modernization project at its Coosa Pines, Ala., mill. Production began at the mill's new deinked pulp facility, while a high-cost newsprint machine and other obsolete assets were permanently closed. The mill now produces high quality, 100 percent recycled newsprint at a competitive cost.
Chesapeake Sees Improvement
Chesapeake Corp. reported income from continuing operations for the fourth quarter, before a restructuring charge, was $9.9 million, up 132 percent over fourth quarter 2000 net income from continuing operations.
After restructuring charges, income from continuing operations for the fourth quarter was $5.6 million, compared to net income from continuing operations for the fourth quarter of 2000 of $2.3 million.
Net income from continuing operations for the fiscal year, before restructuring charges, was $19.8 million, an increase of 25 percent over fiscal year 2000 net income from continuing operations. After restructuring charges, net income from continuing operations for fiscal year 2001 was $10.5 million, compared to net income from continuing operations of $11.2 million for fiscal year 2000.
Thomas Johnson, chairman, president and CEO, said, ``We are quite pleased with our fourth quarter results, particularly in light of weakened global economic conditions. The results highlight the benefits of our chosen markets and sector focus. This quarter completes a year of transformation for Chesapeake, during which we have attained solid financial targets while effecting significant change through several strategic initiatives designed to create a more streamlined and focused pure-play specialty packaging company.”
Abitibi-Consolidated Reports Sharp Drop in Earnings
Abitibi-Consolidated reported 2001 net earnings of $289 million on total sales of $6 billion. Operating profit was $984 million and the EBITDA margin for the year reached 27.4%.
In the fourth quarter the company's net earnings were $4 million on sales of $1.4 billion.
In 2000, reported net earnings were $367 million, and operating profit was $1 billion on sales of $5.7 billion. In the fourth quarter of 2000, net earnings were $148 million on sales of $1.8 billion.
During the fourth quarter the company took about 331,000 metric tons of downtime at its newsprint mills, bringing the total for the year to 796,000 metric tons.
During the first quarter of this year the company expects market-related downtime to continue in its highest-cost operations, as evidenced by the announced idling of machines at its Lufkin and Sheldon, Texas mills and its Port-Alfred, Quebec facility. These machines will stay down until market conditions improve.
Sonoco Sees Dip in Earnings
Sonoco reported fourth sales of $676.6 million, versus $669 million for the same period in 2000. Excluding one-time items, net income for the fourth quarter was $36.5 million, versus $46.3 million in the fourth quarter of 2000.
For the twelve months ending December 31, sales were $2.61 billion, versus $2.71 billion in 2000. The first quarter of 2000 included stronger volumes, while the full year 2000 also had higher selling prices, primarily related to trade sales of recovered paper, compared with 2001.
Excluding one-time transactions, net income for the year was $148.6 million, versus $179.7 million the previous year.
Paperboard International Sees Uptick in Income, Sales
Paperboard Industries International Inc. recorded sales of $206 million for the fourth quarter ended December 31, compared to $202 million for the same time the previous year. For the year ended December 31, net sales rose to $853 million compared to $805 million in 2000. The increase in revenue is mainly due to the acquisition of a folding carton plant in Western Canada.
Earnings before interest, taxes, depreciation and amortization stood at $23 million for the quarter, compared with $19 million for the corresponding quarter of 2000 and $23 million for the third quarter of 2001.
For the year ended December 31 EBITDA stood at $87 million compared to $67 million in 2000. The improved profitability is mostly explained by increased productivity and margins of the boxboard mills.
Net earnings for the quarter amounted to $3.7 million compared with a net loss of $10.5 million for the corresponding quarter in 2000. For the year ended December 31, 2001, Paperboard attained net earnings of $ 0.9 million compared to a net loss of $18 million in 2000.
Paperboard Industries International Inc. has an annual production capacity of 850,000 metric tons of boxboard. The company has seven boxboard mills, located in Canada and Europe. Additionally, the company has an annual converting capacity of 155,000 metric tons of boxboard supplied by
seven plants: two in Quebec, three in Ontario, one in Manitoba and one in