Aug 04, 2005. /Lesprom Network/. Pope and Talbot, Inc. reported a net loss of $7.0 million, or $0.43 per share for the three months ended
The year-over-year decline was driven primarily by a combination of market price decreases for the company's pulp and lumber businesses, as well as increases in the company's cost of goods sold. In particular, the Canadian to U.S. dollar exchange rate continues to cause significant year-over-year increases in the cost of goods sold. For the quarter ended
Lumber import duty deposits on Canadian softwood lumber continue to negatively affect lumber costs. Import duties totaled $10.1 million in the second quarter of 2005, compared with $10.7 million in the same quarter of 2004 and $8.5 million in the first quarter of 2005. The decrease in duties paid, compared with 2004, reflected the decrease in duty deposit rates from a combined rate of 27.22% in 2004 to 20.15% in 2005.
"While we are pleased with the increased lumber production, the year-to-year decline in prices for the company's lumber and pulp products, combined with foreign exchange driven cost increases, continued to erode the earnings of Pope and Talbot, Inc.," stated Mike Flannery, chairman and chief executive officer.
Pope and Talbot's second quarter pulp sales volume decreased 2% to 187,300 metric tonnes, with pulp sales revenues decreasing 8% to $100.9 million, as compared with the second quarter 2004. The average price realized per metric tonne sold during the quarter decreased 6% to $539 from $576 in the second quarter of 2004. The second quarter 2005 pricing represented a 2% decrease from the first quarter 2005 average price realization of $551 per metric tonne.
In the second quarter of 2005, pulp cost of goods sold increased $6.6 million, or 7% compared with the second quarter of 2004, despite the 2% decrease in sales volume. The increase in cost of goods sold was primarily the result of foreign exchange driven cost increases of approximately $6.4 million and a $2.5 million inventory write-down at
Pope and Talbot's second quarter 2005 lumber sales volume increased 33% to 217 million board feet primarily as a result of the Fort St. James acquisition, with wood products sales revenues increasing 21% to $101.2 million, as compared with the second quarter of 2004. The average price realized per thousand board feet sold during the quarter decreased 11% to $409 from $460 in the second quarter of 2004. Second quarter 2005 pricing also declined 7% relative to first quarter 2005 average price realization of $438 per thousand board feet.
In the second quarter of 2005, wood products cost of goods sold increased $27.7 million, or 40%, compared with the second quarter of 2004. Contributing to the cost increases were the 33% increase in sales volume and foreign currency exchange driven cost increases of approximately $4.3 million.
Thousands except per share, unaudited
|
2Q 2005 |
2Q 2004 |
1Q 2005 |
1H 2005 |
1H 2004 |
Total revenues |
202,093 |
193,557 |
207,210 |
409,303 |
370,879 |
Income (loss) before income taxes |
-10,450 |
14,126 |
-1,177 |
-11,627 |
8,749 |
Net income (loss) |
-6,988 |
9,211 |
-645 |
-7,633 |
5,931 |
Net income (loss) per diluted share |
-0.43 |
0.58 |
-0.04 |
-0.47 |
0.37 |
Pope and Talbot is dedicated to the pulp and wood products businesses. The company is based in