VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/14/13 -- INTERNATIONAL FOREST PRODUCTS LIMITED ("Interfor" or the "Company") (TSX: IFP.A) reported net income of $3.7 million or $0.07 per share before one-time items and share-based compensation expense in the fourth quarter of 2012.
These results compare with net earnings, reported on the same basis, of $2.9 million in the third quarter of 2012 and a loss of $2.8 million in the fourth quarter of 2011.
EBITDA for the quarter, adjusted to exclude one-time items, other income and the effects of share-based compensation, was $19.4 million compared with $17.2 million in the third quarter and $7.7 million in the fourth quarter last year.
One-time items and share-based compensation amounted to $7.3 million in the fourth quarter.
The Company's results in the current quarter were negatively impacted by certain costs associated with the rebuild of the Grand Forks sawmill, which was curtailed on November 9th and resumed operations on December 3rd. The estimated impact of these costs on earnings and EBITDA in the fourth quarter was $2.8 million.
Since resuming operations, the Grand Forks mill has been moving through its start-up processes and is currently running at approximately 97% of proforma.
Lumber production in the fourth quarter was 347 million board feet, slightly below the level achieved in the third quarter. Production was negatively affected by the curtailment at Grand Forks and by reduced shifting at the Company's Coastal sawmills, attributable to log shortages post the extended fire closures in that region in mid-year. Sales volume, including wholesale activities, was 384 million board feet, the highest quarterly total in the Company's history.
In the quarter, SPF 2x4 in the U.S. market averaged US$335 per mfbm, up US$35 per mfbm versus the third quarter as mild seasonal conditions and higher activity levels spurred increased demand. Hem-Fir studs were US$360 per mfbm in the quarter, up US$10 versus the third quarter. The market in China gained strength in the quarter and, in Japan, green hemlock squares were up 1% while J Grade dimension was up 7%. Cedar prices continued to inch upwards in the quarter on limited supply.
Export taxes on shipments to the U.S. were 5% in October and 10% in November and December.
In the quarter, Interfor generated $14.6 million in cash from operations after working capital changes were considered. Capital spending amounted to $15.4 million, including $7.9 million on the Grand Forks and Castlegar projects.
Net debt closed the quarter at $120 million or 24.2% percent of invested capital.
Subsequent to the end of the quarter, Interfor announced it had reached agreement with Rayonier Inc. to acquire that Company's Wood Products Business in the U.S. South for $80 million including working capital.
Rayonier's Wood Products Business, headquartered in Baxley, Georgia, consists of three sawmills with a combined annual capacity of 360 million board feet of southern pine dimension lumber. The Rayonier acquisition is consistent with Interfor's strategy of adding capacity in attractive regional markets and will bring Interfor's annual capacity to more than 2 billion board feet.
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