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Fortress hits all-time low after reporting wider-than-expected Q4 loss

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Fortress Paper Ltd. (TSE:FTP), a wood-pulp producer with mills in Quebec, tumbled in midday trading after posting a worse-than-expected loss in the fourth quarter.

Fortress sank 13 percent to a record low of C$2.83 at 1:01 p.m. in Toronto.

Net loss expanded to $54.7 million in the three months ended Dec. 31, from a net loss of $4.2 million in the year-earlier period, the Vancouver, British Colombia-based company said in a statement after market close yesterday.

Excluding certain items, adjusted net loss was $21.2 million, or $1.46 a share in the quarter, compared with a loss of $11.2 million, or 77 cents a share, a year earlier. That exceeded the 99 cents a share loss forecast by analysts.

Revenue dropped to $37.2 million from $58.7 million. That also missed an analyst's estimate of $64.8 million.

Fortress, which makes various types of paper and fibre, or pulp, has divested its specialty papers segment, which is listed as a discontinued operation.

The company announced yesterday that it recorded a $32.9-million item in the fourth quarter to reflect the reduced value of property, plant and equipment its Fortress Global Cellulose mill in Lebel-sur-Quevillon, Quebec.

In November, China threatened to impose a 51 percent interim duty on dissolving pulp from the FGC mill if it converted to that purpose. The mill is currently not in production. China also imposed a 13 percent interim duty on dissolving pulp from the Fortress Specialty Cellulose mill in Thuro, Quebec.

"The 2013 year proved to be very challenging for Fortress Paper," Chief Executive Officer Chadwick Wasilenkoff said in the statement. "Positive developments throughout the year were overshadowed by the disappointing financial results from the Dissolving Pulp Segment."

"As we enter 2014, we believe that we are making progress on numerous initiatives and are confident that we are on the right track to overcome remaining obstacles. I would like to thank the entire team at Fortress Paper for their perseverance and commitment throughout a difficult year."

 

Quick facts: Fortress Paper Ltd.

Price: - CAD

TSX:FTP
Market: TSX
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