Feb 07, 2007. /Lesprom Network/. Fraser Papers Inc. reported on February 6 financial results for the fourth quarter and the year ended December 31, 2006. The company achieved breakeven EBITDA for the fourth quarter of 2006 and a net loss of $12 million or $0.40 per share after interest, taxes, depreciation and amortization. This compared with a loss of $22 million or $0.75 per share in the fourth quarter of 2005. For the full year 2006, EBITDA from the company's paper segment was a loss of $9 million, $1 million lower than the $8 million EBITDA loss generated in 2005. In addition, the company's timber segment generated EBITDA of $2 million, compared to $12 million in 2005. The company completed the sale of its timber operations in the first quarter of 2006. In addition to the planned maintenance shuts, unscheduled downtime at the company's pulp and paper operations negatively impacted EBITDA by $8 million in 2006. Total market-related downtime at the company's sawmills in 2006 amounted to 14 weeks at one Canadian sawmill, 11 weeks at the other Canadian sawmill and four weeks at one U.S. mill. In 2005, the comparable numbers were seven weeks and six weeks for the Canadian sawmills and no downtime at the U.S. sawmills. On a year-to-date basis, the company generated a net loss of $114 million, or $3.86 per share versus $29 million, or $0.98 per share in 2005. Results for 2006 include charges of $161 million related to investment write-offs and plant closures, partly offset by a gain of $71 million on the sale of the company's timberland operations in New Brunswick. In 2005, the company recorded a $46 million gain on the sale of its timberland operations in Maine and a $41 million asset impairment charge. "Despite fourth quarter results that were impacted by sawmill closures and maintenance downtime at two of our pulp and paper facilities, we were successful at improving our product mix by selling higher margin packaging and printing papers which displaced lower margin commodity products. We are confident that we will continue to build upon this progress during 2007 and we remain very focused on capturing the upside that exists at our paper operations from increased throughput and lower costs," said Dominic Gammiero, CEO of Fraser Papers. Outlook Markets for the company's specialty packaging and printing papers are expected to remain firm with volumes comparable with the fourth quarter and prices continuing to trend higher in certain segments. The first and second quarters of the calendar year are typically strong for lightweight financial and specialty packaging papers. During the fourth quarter, Fraser announced price increases of $20-60 per tonne relating to approximately 250 000 tonnes of annual paper sales that became effective on or before January 1, 2007. Certain segments of the paper markets including lightweight coated groundwood and commodity freesheet began to soften during the fourth quarter of 2006 reflecting seasonal weakness in demand. The Company took seven days of downtime on one paper machine at its Gorham paper mill during January, 2007. List prices for northern bleached hardwood pulp remain at attractive levels worldwide with strong demand from non-integrated paper mills. Higher market prices, the elimination of lower margin export sales and strong demand from domestic customers for high quality hardwood pulp produced at the Company's Thurso pulp mill led to an improvement in mill nets of $82 per tonne in the fourth quarter over the same period one year ago. While additional global capacity, built to supply the Asian and European markets, is expected to come on stream during 2007, the Company expects that demand for Fraser's hardwood pulp in domestic markets will remain firm in the short term. While housing markets and lumber prices continue to be weak, the most recent press release from the U.S. Federal Reserve provided optimism for firmer economic growth and some tentative signs of stabilization in the U.S. housing market. Management believes that the acquisition of Katahdin, expected to close at the end of April, is an attractive investment for the company, providing the opportunity for substantial growth in the complementary directory and super-calendered paper segments, with products having strong brand recognition and providing a broader offering to Fraser Papers' publication customers. Fraser Papers is focused on improving results from its operations. Priority is being placed on lowering overall fibre costs and maximizing production on its paper machines. There are no scheduled maintenance outages during the first quarter of 2007. The sulphite pulp mill in Edmundston, New Brunswick will take an extended 21 day outage to perform major maintenance on its recovery boiler during the second quarter. Fraser Papers is an integrated specialty paper company which produces a broad range of specialty packaging and printing papers. The company has operations in New Brunswick, Maine, New Hampshire and Quebec. Fraser Papers is listed on the Toronto Stock Exchange.