The transaction will be financed from Interfor's existing credit lines and is scheduled to close March 1st. The acquisition is expected to be accretive to the Company's earnings and free cash flow from the outset.
Business conditions are expected to continue to improve in 2013. In the U.S., the housing market continues to strengthen and further growth is expected in China. In Japan, building activity in 2013 is expected to increase in anticipation of a planned increase in the consumption tax in 2014 and as a result of reconstruction efforts following the 2011 earthquake and tsunami.
While the near term outlook is more positive than it has been for some time, there are numerous challenges to the global economy that have the potential to undermine the economic recovery. With those concerns in mind, Interfor intends to maintain its disciplined approach to production, cost control and inventory management while remaining alert to opportunities to position the Company for long-term success.
FORWARD-LOOKING STATEMENTS
This release contains information and statements that are forward-looking in nature, including, but not limited to, statements containing the words "will" and "is expected" and similar expressions. Such statements involve known and unknown risks and uncertainties that may cause Interfor's actual results to be materially different from those expressed or implied by those forward-looking statements. Such risks and uncertainties include, among others: general economic and business conditions, product selling prices, raw material and operating costs, changes in foreign-currency exchange rates, and other factors referenced herein and in Interfor's Annual Report and Management Information Circular available on www.sedar.com. The forward-looking information and statements contained in this report are based on Interfor's current expectations and beliefs. Readers are cautioned not to place undue reliance on forward-looking information or statements. Interfor undertakes no obligation to update such forward-looking information or statements, except where required by law.
ABOUT INTERFOR
Interfor is a leading global supplier, with one of the most diverse lines of lumber products in the world. The Company has operations in British Columbia, Washington and Oregon, including two sawmills in the Coastal region of British Columbia, three in the B.C. Interior, two in Washington and two in Oregon. For more information about Interfor, visit our website at www.interfor.com.
There will be a conference call on Friday, February 15, 2013 at 8:00 AM (Pacific Time) hosted by INTERNATIONAL FOREST PRODUCTS LIMITED for the purpose of reviewing the Company's release of its Fourth Quarter, 2012 Financial Results.
The dial-in number is 1-866-323-8540. The conference call will also be recorded for those unable to join in for the live discussion, and will be available until March 1, 2013. The number to call is 1-866-245-6755, Passcode 568465.
SELECTED QUARTERLY FINANCIAL INFORMATION(1)----------------------------------------------------------------------------Quarterly Earnings Summary 2012 2011 ------------------------------------------------------------- Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 ------------------------------------------------------------- (millions of dollars except share, per share and foreign exchange rate amounts)Sales - Lumber(2) 173.3 161.9 162.4 133.6 133.6 139.6 133.7 131.4 - Logs 24.5 26.8 35.6 27.0 22.9 36.0 28.6 20.8 - Wood chips and other residual products 15.9 17.5 17.8 18.2 17.5 17.6 16.8 16.4 - Other 8.7 8.5 9.6 7.9 14.6 9.9 8.7 10.0 -------------------------------------------------------------Total Sales 222.4 214.7 225.4 186.7 188.7 203.1 187.9 178.6 -------------------------------------------------------------Operating earnings (loss) before restructuring costs and asset impairments(2) (1.9) 2.5 2.9 (5.5) (6.2) 3.9 (2.3) (0.1)Operating earnings (loss) (2) (2.2) 2.4 2.8 (5.5) (6.1) 4.2 (2.4) (1.0)Net earnings (loss) (3.6) 1.1 0.3 (6.5) (6.5) 0.0 (5.3) (1.7)Net earnings (loss) per share - basic and diluted (0.06) 0.02 0.01 (0.12) (0.12) 0.00 (0.10) (0.04)Net earnings (loss), adjusted for certain one- time and other items(2,3) 3.7 2.9 1.1 (3.9) (2.8) 1.4 (6.3) 1.9Net earnings (loss), adjusted for certain one- time and other items - per share(2) 0.07 0.05 0.02 (0.07) (0.05) 0.03 (0.11) 0.04EBITDA(7) 13.2 15.2 16.5 6.0 6.7 17.6 11.3 11.6Adjusted EBITDA(2,7) 19.4 17.2 16.7 7.2 7.7 16.3 8.2 15.1Cash flow from operations per share(4) 0.24 0.20 0.24 0.15 0.08 0.26 0.22 0.27Shares outstanding - end of period (millions)(5) 55.9 55.9 55.9 55.9 55.9 55.9 55.9 47.5 - weighted average (millions) 55.9 55.9 55.9 55.9 55.9 55.9 55.2 47.4Average foreign exchange rate per US$1.00(6) 0.9914 0.9954 1.0104 1.0010 1.0230 0.9808 0.9680 0.9856Closing foreign exchange rate per US$1.00(6) 0.9949 0.9832 1.0181 0.9975 1.0170 1.0482 0.9645 0.96961. Tables may not add due to rounding.2. The Company uses forward foreign exchange contracts which are designated as held for trading and are carried on the Statement of Financial Position at fair value. Previously changes in fair value were recorded as an adjustment to Sales in Net earnings. Effective January 1, 2012, the Company changed its accounting policy to align with the presentation adopted by companies in its peer group and changes in fair value are now recorded in Other foreign exchange gain (loss) in Net earnings. The policy has been applied on a retrospective basis and comparative information has been restated. There is no change to Net earnings as a result of the adoption of this new policy.3. Net earnings (loss) adjusted for certain one-time and other items represents the net loss before restructuring costs, long term incentive compensation expense (recovery), certain foreign exchange gains and losses, other income (expense) and the effect of unrecognized tax assets. Net earnings (loss), adjusted for certain one-time and other items is not a defined term under IFRS, and may not be comparable to adjusted net earnings (loss) calculated by others. Net earnings (loss), adjusted for certain one-time and other items may be calculated as follows: 2012 2011 ------------------------------------------------ Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 ------------------------------------------------ (millions of dollars)Net earnings (loss) (3.6) 1.1 0.3 (6.5) (6.5) 0.0 (5.3) (1.7)Add (deduct): Restructuring costs, asset impairments and other costs (recovery) 0.3 0.1 0.1 - (0.1) (0.3) 0.1 0.8 Long term incentive compensation expense (recovery) 6.2 2.3 0.2 1.3 0.9 (0.9) (3.1) 3.5 Other foreign exchange (gains) losses (0.2) (0.1) 0.5 (0.4) (1.1) 2.5 (0.2) (1.1) Other (income) expense 0.0 (0.2) (0.0) (0.1) 0.0 (0.4) (0.0) (0.0) Income tax on adjustments 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Deferred tax assets not recognized (recognized) 1.0 (0.4) 0.0 1.8 3.9 0.6 2.2 0.3 ------------------------------------------------ Net earnings (loss), adjusted for certain one- time and other items 3.7 2.9 1.1 (3.9) (2.8) 1.4 (6.3) 1.9 ------------------------------------------------4. Cash generated from operations before taking account of changes in operating working capital.5. As at February 14, 2013, the numbers of shares outstanding by class are: Class A Subordinate Voting shares - 54,847,176 Class B Common shares - 1,015,779, Total - 55,862,955.6. Rates are based on Bank of Canada closing foreign exchange rates per US$1.00.7. The Company discloses EBITDA as it is a measure used by analysts and Interfor's management to evaluate the Company's performance. As EBITDA is a non-GAAP measure, it may not be comparable to EBITDA calculated by others. In addition, as EBITDA is not a substitute for net earnings, readers should consider net earnings in evaluating the Company's performance. Adjusted EBITDA represents EBITDA adjusted for other income. EBITDA and Adjusted EBITDA can be calculated from the statements of operations as follows: 2012 2011 ------------------------------------------------ Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 ------------------------------------------------ (millions of dollars)Net earnings (loss) (3.6) 1.1 0.3 (6.5) (6.5) 0.0 (5.3) (1.7)Add: Income taxes (recovery) 0.0 0.0 0.3 - 0.2 0.5 1.2 (0.4) Finance costs 1.5 1.6 1.7 1.5 1.3 1.7 1.9 2.3 Depreciation, depletion and amortization 15.1 12.4 13.6 11.3 13.0 13.3 13.6 11.7 Other foreign exchange (gains) losses (0.2) (0.1) 0.5 (0.4) (1.1) 2.5 (0.2) (1.1) Restructuring costs, asset impairments and other costs (recoveries) 0.3 0.1 0.1 - (0.1) (0.3) 0.1 0.8 ------------------------------------------------EBITDA 13.2 15.2 16.5 6.0 6.7 17.6 11.3 11.6Add (deduct): Long term incentive compensation expense (recovery) 6.2 2.3 0.2 1.3 0.9 (0.9) (3.1) 3.5 Other (income) expense 0.0 (0.2) (0.0) (0.1) 0.0 (0.4) (0.0) (0.0) ------------------------------------------------Adjusted EBITDA 19.4 17.2 16.7 7.2 7.7 16.3 8.2 15.1 ------------------------------------------------
