Ainsworth posts net loss of $17.3 million

Ainsworth Lumber Co. Ltd. has posted a net quarterly loss of $17.3 million compared to a net income of $29.8 million in the second quarter of 2009.

Ainsworth President and CEO Rick Huff said, "Based on the work we have done to streamline the business and execute on our strategy, we were able to take full advantage of what proved to be very favourable demand conditions in the first six months of the year."

"As OSB prices return to what forecasters predict will be more modest and sustainable prices, we believe the same qualities that benefited us in the first half of 2010 - being customer oriented and committed to working safely and efficiently - will serve us well in the second half of the year. Our aim is to continue building the foundations of a business at Ainsworth that can be strong and profitable over the long term," said Mr. Huff.

Sales of $96.1 million in the second quarter of 2010 were $25.3 million higher than sales of $70.8 million for the same period in 2009. The increase in sales was due to a 46.6% increase in our realized sales price offset by a 7.4% decrease in volume as compared to the high production rates achieved in the second quarter of 2009.

During the first half of 2010, realized sales prices increased by 25.5% while volume increased by 1.0%, resulting in an overall increase in sales to $177.2 million compared to $140.0 million in the first half of 2009.

Cost of products sold was $57.5 million in the second quarter of 2010, representing a 14.7% decrease over costs of $67.4 million in the second quarter of 2009. During the first half of 2010, cost of products sold decreased by 9.3% to $119.0 million compared to the first half of 2009. The decrease for both periods is the result of a stronger Canadian dollar relative to the U.S. dollar, and savings in freight costs. These cost decreases were partially offset by increases in resin and wax pricing.

Source: Ainsworth