Domtar reports third quarter 2011 financial results
Friday, October 28, 2011
Press release from the issuing company
Domtar Corporation today reported net earnings of $117million ($2.95 per share) for the third quarter of 2011 compared to net earnings of $54million ($1.30 per share) for the second quarter of 2011 and net earnings of $191million ($4.44per share) for the third quarter of 2010. Sales for the third quarter of 2011 amounted to $1.4billion. Excluding items listed below, the Company had earnings before items1 of $123 million ($3.10 per share) for the third quarter of 2011 compared to earnings before items1 of $98 million ($2.37 per share) for the second quarter of 2011 and earnings before items1 of $183million ($4.26 per share) for the third quarter of 2010.
Third quarter 2011 items:
Second quarter 2011 items:
Third quarter 2010 items:
"Our performance remains strong. Our financial results improved when compared to the second quarter despite the decline in average selling prices for pulp and high input costs," said John D. Williams, President and Chief Executive Officer. "While our domestic commodity uncoated paper volumes are in line with market demand, we have developed some business in new markets and geographies which has allowed our volumes to remain steady. The recent acquisition of Attends offers us organic growth prospects and the economic uncertainty provides a backdrop to seize other opportunities and to continue to buy back stock," added Mr. Williams.
Domtar completed the acquisition of privately-held Attends Healthcare, Inc. ("Attends") on September 1, 2011. The results reported for the third quarter of 2011 include the financial results of Attends for the period from September 1, 2011 to September 30, 2011. The segment results are reported under "Personal Care" segment.
LIQUIDITY AND CAPITAL
Cash flow provided from operating activities amounted to $257 million and capital expenditures amounted to $31 million resulting in free cash flow1 of $226 million in the third quarter of 2011.
Under its stock repurchase program, Domtar repurchased 2,515,791 shares of common stock during the third quarter and a total of 5,725,841 shares of common stock at an average price of $82.16 since the implementation of the program in May 2010. Domtar currently has $130 million remaining availability under its Program.
Domtar paper shipments are expected to decline in the fourth quarter when compared to the third quarter due to seasonal factors while the cyclical downturn in global pulp markets is expected to lead to further declines in average selling prices for market pulp. Domtar's fourth quarter results will benefit from the inclusion of Attends' financial results for a full quarter.
1 Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix.
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