Potlatch Expects First Quarter Earnings To Be Below Analysts Estimates
Press release from the issuing company
Spokane - Potlatch Corporation (NYSE:PCH) today announced that it expects first quarter 2001 earnings to be significantly below analysts' estimates. The current “First Call” consensus is a loss of $0.60, which includes a low estimate of an $0.84 loss.
Potlatch chairman and chief executive officer L. Pendleton Siegel said the shortfall is attributable in part to the continuing high cost of natural gas and electricity at its facilities, particularly in the northwest where significant increases in electricity prices have occurred, primarily as a result of shortages in California. He added the company has begun and is continuing to mitigate high energy costs, which could persist through the balance of 2001, by conserving energy through internal systems changes and increasing internal generation of electricity.
Poor markets for most of its products during the first two months of the year is the other major factor affecting the company’s financial performance, Siegel noted.
“With the exception of tissue, which has shown modest price improvements, pricing for lumber and panel products, printing papers, and pulp and paperboard were down dramatically from the first quarter of 2000 and down considerably over the fourth quarter of 2000 as well,” he added.
Siegel added, however, that Potlatch’s modernized and expanded oriented strand board plant in Cook, Minnesota, has been operating well since its startup in late January. In addition, the new pulp mill in Cloquet, Minnesota, continues to increase production and reduce costs.
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