KINGSEY FALLS, Que. – Cascades Inc. (TSX: CAS) reports a second-quarter loss of $83 million, impacted by such factors as its exit from the kraft paper business and a European mill closure.
That amounts to 88 cents per share, compared with a net profit of $2 million, or three cents per share, in the same quarter in 2013.
Excluding items, adjusted net earnings amounted to $7 million, or eights cents per share, compared with $8 million, or nine cents per share, for the same period in 2013.
In July, Cascades announced the closure of its kraft paper plant in East Angus, Que., cutting 175 jobs. Cascades has said the closure was due to unfavourable market conditions and the inability to finalize a sale of the plant. Kraft paper is used to make envelopes, promotional materials and fast-food wrapping.
The Quebec company also announced the sale of its fine papers division to Rolland Enterprises Inc., a subsidiary of H.I.G. Capital, for $39.5 million, closed a boxboard mill in Sweden and refinanced some of its debt.
“These decisions, while having a negative impact on our net results in the short term, will positively impact our profitability in the medium and long term and give us more flexibility to invest in our strategic assets,” president and CEO Mario Plourde said Tuesday in a statement.
“Even if some of these decisions were difficult to make, we need to appreciate the progress achieved and keep in mind that they will strengthen the financial situation of the company,” Plourde said.