Potlatch Reports Q1 Results: Net Loss of $8.9 Million
Press release from the issuing company
SPOKANE, Wash.--April 16, 2003-- Potlatch Corporation today reported a smaller loss from continuing operations for the first quarter of 2003 compared to 2002, largely due to a smaller loss at its Pulp and Paperboard segment and lower interest expense.
The company incurred a net loss from continuing operations of $8.9 million, or $.31 per diluted common share, for the first quarter of 2003, compared to a loss from continuing operations of $14.9 million, or $.53 per diluted common share, for the first quarter of 2002. Including discontinued operations, the company incurred a net loss of $9.6 million, or $.33 per diluted common share, for 2003's first quarter, compared to a net loss of $167.4 million, or $5.90 per diluted common share for the same period last year. Discontinued operations consist of the company's former printing papers segment and a hardwood sawmill. Net sales for the first quarter of 2003 were $333.6 million, slightly better than the $318.2 million recorded in the first quarter of 2002.
The Resource segment reported operating income of $11.1 million for the first quarter of 2003, an improvement over the $10.0 million earned in the first quarter of 2002. Gains on the sale of lands into higher value, non-timber uses were largely responsible for the favorable comparison.
The Wood Products segment incurred an operating loss of $3.6 million for the first quarter of 2003, compared to a loss of $1.1 million recorded in the first quarter of 2002. "Wood products markets continued to be oversupplied from both Canadian and domestic sources during the first three months of 2003," said L. Pendleton Siegel, Potlatch chairman and chief executive officer. "The segment's net sales were positively influenced by slightly improved shipments and sales prices for oriented strand board, which partially offset lower sales prices for lumber."
The Pulp and Paperboard segment reported an operating loss for 2003's first quarter of $9.3 million, versus a loss of $19.0 million for 2002's first quarter. "Higher shipments for both paperboard and pulp, as well as higher sales prices for pulp, positively affected results for the quarter," Siegel said. "Pulp and paperboard production at the Lewiston, Idaho, facility was significantly higher during the first quarter, which resulted in substantially lower unit production costs compared with the first quarter of 2002."
The Consumer Products segment recorded operating income of $6.8 million for the first quarter of 2003, significantly below first quarter 2002 operating income of $13.3 million. "Although product shipments for the segment were 3% above last year's levels, additional promotional costs in the first quarter of 2003 resulted in lower net sales prices, which more than offset the benefits of higher shipments," Siegel noted. Freight costs also adversely affected results for the first quarter of 2003, rising approximately 15% compared to the first quarter of 2002.
Lower interest expense was due to significantly less debt outstanding during the first quarter of 2003 compared to the same period last year. The company reduced overall debt by approximately $470 million during 2002, in part by using proceeds from the sale of Printing Papers segment assets.
Potlatch is a diversified forest products company with timberlands in Arkansas, Idaho and Minnesota.
WhatTheyThink is the global printing industry's leading independent media organization with both print and digital offerings, including WhatTheyThink.com, PrintingNews.com and WhatTheyThink magazine versioned with a Printing News and Wide-Format & Signage edition. Our mission is to provide cogent news and analysis about trends, technologies, operations, and events in all the markets that comprise today’s printing and sign industries including commercial, in-plant, mailing, finishing, sign, display, textile, industrial, finishing, labels, packaging, marketing technology, software and workflow.