Cascades Inc. has reversed a year earlier loss to post a $6-million profit in the first quarter as the packaging and tissue maker saw revenue soar by more than $100 million.
KINGSEY FALLS, Que.: Cascades Inc. has reversed a year earlier loss to post a $6-million profit in the first quarter as the packaging and tissue maker saw revenue soar by more than $100 million.
The Quebec-based company, which makes its products mainly from recycled fibres, said earnings amounted to six cents per share, compared with a year-earlier loss of $8 million or eight cents per share.
Sales revenue in the three months ended March 31 was $891 million, up from $774 million.
President and CEO Alain Lemaire described the results as a “significant improvement” but still “below our expectations due to a low level of productivity of our containerboard manufacturing operations.”
He said the company’s tissue papers group continued to perform well and its specialty products group had shown improvement.
“During this past quarter, we benefited from lower recycled fibre costs and average selling prices have held for most of our products despite volatile demand,” Lemaire added.
The company’s strategic initiatives include the acquisition of the corrugated boxes converting and warehousing facilities of Bird Packaging Ltd. in Guelph, Windsor and Kitchener, Ont.; investments of $30 million and closures of three plants to consolidate its corrugated products businesses in Ontario; consolidation of its honeycomb packaging manufacturing operations with the closure of Cascades Enviropac in Toronto; and the closure of the Trenton, Ont. containerboard mill because of financial losses and “unsatisfactory labour relations.”
Looking ahead, Lemaire said the economic environment remains difficult in the near term, but “seems to be gaining momentum in North America, which is encouraging as we enter what have been historically our two strongest quarters of the year.”