May 13, 2010. /Lesprom Network/. Cascades Inc. announces its financial results for the three months ended March 31, 2010. In comparison with the same period last year, sales decreased by 3% to $942 million resulting from lower selling prices and the appreciation of the Canadian dollar partly offset by a 12% increase in shipments (excluding the impact of the acquisition of the tissue assets of Atlantic Packaging). Net earnings excluding specific items amounted to $0 in the 1Q 2010 compared to $21 million for the same period of last year. Including specific items, net earnings amounted to $0 compared to $37 million for the same quarter in 2009. The operating income excluding specific items amounted to $23 million compared to $53 million in Q1 2009. Weaker energy and certain variable costs, the optimization of our cost structure as well as improved operating rates were more than offset by the negative effect of lower selling prices, higher raw material costs and the stronger Canadian dollar. When including specific items, operating income amounted to $27 million in comparison to $49 million in the same period of last year. Mr. Alain Lemaire, President and CEO added: "We expect a rebound in profitability mostly as a result of the significant momentum in pricing. Many of our operations will benefit from the selling price increases that were implemented during the 1Q and some recently announced additional hikes should be realized in the coming months. Also, the strong demand that we currently acknowledge in almost all our sectors as well as the usual seasonal pickup should continue to positively impact our operational efficiency and financial results. On the cost front, energy prices are currently lower than in the first three months of the year. In addition, the publication price of old corrugated containers (OCC), the main grade of recycled fibres consumed by Cascades, is down since its peak in March. All in all, we remain confident for the coming months, especially for our packaging operations." Cascades produces, converts and markets packaging and tissue products that are composed mainly of recycled fibres.