EACOM Timber releases 2011 year end figures
The results from 2011 include an impairment charge of $15,000,000 partially offset by a gain of $4,339,000 on the sale of the Big River mill and an immediate $2,940,000 recovery of income taxes as a result of the acquisition of the remaining one-third interest in the Elk Lake sawmill.
Sales in 2011, including both lumber and by-product sales, were $279,967,000. Lumber production for the year was 523 million board feet.
The improved liquidity position resulted from net proceeds of $32,346,000 from a private placement of the Company’s common shares in the second quarter of 2011, proceeds of $7,500,000 from the disposal of the idled mill located in Big River, Saskatchewan in the third quarter of 2011, a substantial reduction of inventories as a result of a more aggressive management of working capital combined with the temporary shutdown of operations at Val-d’Or and Matagami, and the collection of in excess of $10 million of road tax credits in the fourth quarter of 2011. Part of the net proceeds from the private placement were used to acquire the remaining one-third interest in the Elk Lake sawmill and to repay $7,000,000 of outstanding borrowings under the revolving credit facility.
In April, EACOM Timber closed a $40 million secured debenture financing from Fairfax Financial Holdings, the net proceeds of which will be used for general corporate purposes.
EACOM Timber owns eight sawmills, all located in Eastern Canada, and related tenures. The mills are Timmins, Nairn Centre, Gogama, Elk Lake and Ear Falls in Ontario, and Val-d’Or, Ste-Marie and Matagami in Quebec. The mills in Ear Falls, Ontario, and Ste-Marie, Quebec, are currently idled, and operations in Val-d’Or and Matagami have been temporarily shut down due to current market conditions. EACOM also owns a remanufacturing facility in Val-d’Or, Quebec, and a 50% interest in an “I” joist plant in Sault Ste-Marie, Ontario.
Source: EACOM Timber (read release)
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