Catalyst Paper reports net earnings of $6 million

Catalyst Paper has reported a net income of $6.0 million in its latest quarter on sales of $322.3 million.

This result contrasts with a net loss of $368.4 million on sales of $299.4 million in the prior quarter. While second quarter results were significantly impacted by impairment, severances and other closure costs of $302.0 million, improvement in the most recent quarter also reflects better paper market conditions and operational performance.

"Business conditions are tough but showing signs of improvement," said President and CEO Kevin J. Clarke. "Sales volumes and prices were up as North American paper demand stabilized. Our mills and machines ran well enabling us to get the most out of the modest market recovery. And we're beginning to realize the fixed cost savings from the permanent closures of the Elk Falls and Paper Recycling facilities. In addition, we made significant progress in expanding existing customer commitments and have successfully sold into new markets."

Further improvement in benchmark prices across all Catalyst paper products is expected in the fourth quarter with directory improvements taking effect with new contracts in 2011. Pulp prices, in contrast, are expected to decrease as Chinese demand weakens. Production curtailment is expected to be contained to the Crofton No. 1 newsprint machine; however, rising input costs and the strong Canadian dollar will continue to put adverse pressure on results in the current and future quarters.

More Details: Catalyst Paper Q3 results strengthen on paper price and operational improvement (Catalyst Paper)