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Last updated on April 19, 2014 at 9:20 EDT

Resolute Reports Preliminary First Quarter 2013 Results

April 30, 2013

US $

        --  Solution to Canadian pension funding situation within reach
        --  Refinancing of high-cost senior secured notes
        --  Q1 Adjusted EBITDA of $72 million, compared to $71 million in
            Q1 2012

MONTREAL, April 30, 2013 /PRNewswire/ – Resolute Forest Products Inc.
(NYSE: RFP) (TSX: RFP) today reported a net loss of $5 million for the
quarter ended March 31, 2013, or $0.05 per share, on sales of $1.074
billion. This compares to net income of $23 million, or $0.23 per
diluted share, on sales of $1.054 billion in the first quarter ended
March 31, 2012.

Excluding $33 million of special items, net income for the quarter was
$28 million, or $0.30 per share. Excluding special items of $16
million, net income in the first quarter of 2012 was $7 million, or
$0.07 per diluted share. Non-GAAP financial measures, such as
adjustments for special items and adjusted EBITDA, are reconciled
below.

“Our efforts to restructure mills and machines during the last two years
will lower our manufacturing costs, which will help to mitigate the
challenges facing the North American forest products industry,” said
Richard Garneau, president and chief executive officer.

Concerning the status of the funding relief measures related to the
material Canadian registered pension plans, he added: “On April 26, we
reached an agreement in principle with Company stakeholders in Quebec,
the provincial government, and its pension regulator to replace the
significant uncertainty associated with potentially material corrective
measures in favor of more stable, predictable and balanced pension
funding we need to run our business. Under this agreement, we would
make reasonable incremental contributions in order to secure
longer-term funding stability. With this significant progress in
Quebec, we look forward to meeting very soon with the provincial
government of Ontario and its pension regulator, and our Ontario
stakeholders.”

Operating Income Variance

In the first quarter of 2013, the Company recorded an operating loss of
$50 million, compared to $46 million in the fourth quarter of 2012. The
$4 million unfavorable change reflects a $54 million reduction in
sales, due to lower shipments of newsprint and specialty papers due to
seasonality and market conditions, and capacity reduction
initiatives. Overall pricing contributed $4 million, as higher
transaction prices in wood products more than offset declines in
newsprint. Cost of sales was down $19 million, due mainly to the lower
volume, offset in part by costs associated with the annual outage at
the Catawba, South Carolina, mill, higher mill start-up costs and
increases in certain other manufacturing costs. The change in operating
results was also favorably affected by a $42 million reduction in
closure costs.

Segment Details

Newsprint

The newsprint segment reported an operating loss of $2 million in the
first quarter, compared to operating income of $18 million in the
fourth quarter of 2012. Average transaction price was down $17 per
metric ton as a result of capacity pressure within North
America. Overall shipments were down 6% in the seasonally slower
quarter, but export volume rose to 46% of total shipments, compared to
37% in the fourth quarter, as a result of a gradual improvement in
overseas markets. Finished goods inventory was 20,000 metric tons
higher at the end of the quarter. Operating costs per unit rose 3% as a
result of the lower volume, higher steam costs because of higher
natural gas prices and seasonally higher consumption, and the timing of
payroll benefits. The Company expects to restart its lower-cost
Gatineau, Quebec, facility in early May to offset the recent machine
closure at its Calhoun, Tennessee, mill.

Coated Papers

The coated segment generated an operating loss of $3 million during the
quarter, compared to operating income of $3 million in the previous
quarter.  Shipments rose 6% from the fourth quarter, in which the
Company experienced equipment failures at the Catawba mill. Average
transaction price was unchanged but operating costs rose $40 per short
ton owing to the mill’s annual outage.

Specialty Papers

Operating income increased by $1 million, to $9 million, in the
quarter. Shipments were down 10%, reflecting seasonality and market
conditions. During the fourth quarter, the Company implemented asset
optimization initiatives, closing two machines and restarting the
lower-cost Dolbeau, Quebec, facility. Operating costs in the segment
improved by $14 per short ton as the Dolbeau mill, including its
cogeneration facility, reached full production and the Company made
efficiency improvements at its Laurentide, Quebec, mill. Costs were
unfavorably affected by higher steam costs from higher natural gas
prices and seasonally higher consumption.  Average transaction price
was down $8 per short ton in the quarter.

Market Pulp

Operating loss in the market pulp segment was $4 million in the first
quarter, compared to breakeven in the previous quarter. Average
transaction price rose $7 per metric ton, but shipments were down 2%,
due mainly to the annual outage at the Catawba mill. Operating cost per
unit were $19 per metric ton higher, due to the annual outage at
Catawba, higher wood costs in the U.S. southeast due to heavy rain and
higher steam and chemical costs.  Cost performance at the
Saint-Felicien, Quebec, mill improved significantly following the
costly catch-up maintenance and environmental work during the third and
fourth quarters of 2012.

Wood Products

The wood products segment generated operating income of $16 million
during the quarter, up $2 million from the fourth quarter. Average
transaction price improved $36 per thousand board feet, but shipments
were down 3% as a result of limited rail car availability. Operating
costs per thousand board feet were 8% higher in the quarter because of
higher wood costs – mainly increases in stumpage fees, which are linked
to lumber selling prices – lower wood chip selling prices and a $4
million favorable inventory adjustment in the fourth quarter.

Corporate & Finance Initiatives

On April 26, the Company announced the pricing of its $600 million
senior notes due 2023 offering at 5.875%, to be issued at 99.062% of
par value.  Net proceeds from the offering will be used to repurchase,
repay or otherwise discharge all, or substantially all, of its $501.2
million outstanding 10.25% senior secured notes due 2018.

“With our strong balance sheet, we are able to take advantage of very
attractive financial markets” said Jo-Ann Longworth, senior vice
president and chief financial officer. ”We are refinancing our
high-coupon, secured debt with unsecured debt at an interest rate that
is more than 40% lower and adds five additional years to
maturity. Consistent with our strategy of acting opportunistically to
continuously enhance our competitive position, it’s the right time to
lock in these attractive terms, which will reduce our annual interest
burden by $15 million and improve our financial flexibility.”

The offering of the 2023 notes is expected to close on May 8, subject to
customary closing conditions.

Outlook

Mr. Garneau added: “While we are encouraged with the incremental
progress we are seeing on newsprint export markets, we expect domestic
pricing to remain under pressure until more tonnes produced in North
America are shipped offshore. With markets for specialty papers
strongly influenced by advertising spending, demand may remain sluggish
as customers are cautious based on recent U.S. economic data. Recent
demand and pricing trends in the pulp market are giving us reason for
cautious optimism that it is gaining momentum after its prolonged
slump. Finally, lumber pricing has been strong, and we expect it to
remain at or near current levels, as shipments from Canadian producers
continue to be limited by strained supply chains from the increase in
demand.”

Earnings Conference Call

The Company will hold a conference call to discuss the financial results
at 9:00 a.m. (ET) today. The public is invited to join the call at
(888) 789-9572 (pass code 9922866) at least fifteen minutes before its
scheduled start time. A simultaneous webcast will also be available
using the link provided under “Presentations and Webcasts” in the
“Investors” section of www.resolutefp.com. A replay of the webcast will be archived on the Company’s website. A
phone replay will also be available until May 14 by dialing (800)
408-3053 with the pass code 4105820.

Description of Special Items


    Special items, net of tax
    (in millions)                   First quarter 2013   First quarter 2012

    Charge (gain) on non-cash
    translation of Canadian
    dollar net monetary assets                    $  7              $  (15)

    Severance                                        -                    1

    Closure costs, impairment and
    other related charges                           25                    4

    Inventory write-downs related
    to closures                                      2                    -

    Start-up costs of idled mill                    11                    -

    Net gain on disposition of
    assets                                           -                 (12)

    Post-emergence costs                             -                    1

    Transaction costs                                3                    4

    Other income, net                             (15)                  (2)

    Non-cash charge for
    reorganization-related and
    other tax adjustments                           -                     3

      Total                                      $  33              $  (16)

Cautionary Statements Regarding Forward-Looking Information

Statements in this press release and the earnings conference call
referred to above that are not reported financial results or other
historical information of Resolute Forest Products Inc. are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. They include, for example,
statements relating to our: efforts to reach resolution concerning the
funding relief measures related to the material Canadian registered
pension plans; efforts to continue to reduce costs and increase
revenues and profitability, including our cost-reduction initiatives
regarding selling, general and administrative expenses; business and
operating outlook; assessment of market conditions; prospects, growth
strategies and the industry in which we operate; strategies for
achieving our goals generally; and ability to repurchase or redeem our
10.25% senior secured notes with the proceeds from the sale of our 2023
notes.  Forward-looking statements may be identified by the use of
forward-looking terminology such as the words “should,” “would,”
“could,” “will,” “may,” “expect,” “believe,” “anticipate,” “attempt,”
“project” and other terms with similar meaning indicating possible
future events or potential impact on our business or Resolute’s
shareholders.

The reader is cautioned not to place undue reliance on these
forward-looking statements, which are not guarantees of future
performance. These statements are based on management’s current
assumptions, beliefs and expectations, all of which involve a number of
business risks and uncertainties that could cause actual results to
differ materially. The potential risks and uncertainties that could
cause Resolute’s actual future financial condition, results of
operations and performance to differ materially from those expressed or
implied in the presentation referred to above include, but are not
limited to, the potential risks and uncertainties set forth under the
heading “Risk Factors” in Exhibit 99.4 to Resolute’s current report on
Form 8-K filed with the U.S. Securities and Exchange Commission on
April 24, 2013.

All forward-looking statements in the presentation referred to above are
expressly qualified by the cautionary statements contained or referred
to above and in Resolute’s other filings with the SEC and the Canadian
securities regulatory authorities. Resolute disclaims any obligation to
publicly update or revise any forward-looking information, whether as a
result of new information, future events or otherwise, except as
required by law.

About Resolute Forest Products

Resolute Forest Products is a global leader in the forest products
industry with a diverse range of products, including newsprint,
commercial printing papers, market pulp and wood products. The Company
owns or operates over 40 pulp and paper mills and wood products
facilities in the United States, Canada and South Korea, and power
generation assets in Canada. Marketing its products in close to 90
countries, Resolute has third-party certified 100% of its managed
woodlands to at least one of three internationally-recognized
sustainable forest management standards, including 65% certified to the
Forest Stewardship Council® (FSC®) standards. The shares of Resolute
Forest Products trade under the stock symbol RFP on both the New York
Stock Exchange and the Toronto Stock Exchange.

Resolute and other member companies of the Forest Products Association
of Canada, as well as a number of environmental organizations, are
partners in the Canadian Boreal Forest Agreement. The group works to
identify solutions to conservation issues that meet the goal of
balancing equally the three pillars of sustainability linked to human
activities:  environmental, social and economic. Resolute is also a
member of the World Wildlife Fund’s Climate Savers program, in which
businesses establish ambitious targets to voluntarily reduce greenhouse
gas emissions and work aggressively toward achieving them.


                                   RESOLUTE FOREST PRODUCTS INC.

                             CONSOLIDATED STATEMENTS OF OPERATIONS

                    (Unaudited, in millions except per share amounts)

                                            Three Months      Three Months

                                          Ended March 31,   Ended March 31,

                                                  2013              2012

    Sales                                 $         1,074   $         1,054

    Costs and expenses:                                                    

      Cost of sales, excluding
      depreciation and amortization                   857               836

      Depreciation and amortization                    60                57

      Distribution costs                              123               121

      Selling, general and administrative
      expenses                                         44                32

      Closure costs, impairment and other
      related charges  (1)                             40                 5

      Net gain on disposition of assets                 -              (23)

    Operating (loss) income                          (50)                26

    Other (expense) income:                                                

      Interest expense                               (14)              (16)

      Foreign currency translation (loss)
      gain (2)                                        (5)                12

      Other, net (3)                                   23                 1

    (Loss) income before income taxes                (46)                23

    Income tax benefit  (4)                            41                10

    Net (loss) income including
    noncontrolling interests                          (5)                33

    Net income attributable to
    noncontrolling interests                            -              (10)

    Net (loss) income attributable to
    Resolute Forest Products Inc.         $           (5)   $            23

    Net (loss) income per share
    attributable to Resolute Forest
    Products Inc. common shareholders:
    (5)                                                                    

      Basic                               $        (0.05)   $          0.23

      Diluted                             $        (0.05)   $          0.23

    Weighted-average number of Resolute
    Forest Products Inc. common shares
    outstanding: (5)                                                       

      Basic                                          94.8              97.1

      Diluted                                        94.8              97.1


                                RESOLUTE FOREST PRODUCTS INC.

                                  CONSOLIDATED BALANCE SHEETS

                                    (Unaudited, in millions)

                                               March 31,   December 31,

                                                  2013           2012

    Assets                                                             

    Current assets:                                                    

      Cash and cash equivalents                $     215   $        263

      Accounts receivable trade, net                 586            576

      Accounts receivable other                      121            121

      Inventories, net                               584            545

      Deferred income tax assets                      55             56

      Other current assets                            71             58

        Total current assets                       1,632          1,619

    Fixed assets, net                              2,386          2,440

    Amortizable intangible assets, net                68             69

    Deferred income tax assets                     1,957          2,002

    Other assets                                     188            194

      Total assets                             $   6,231   $      6,324

    Liabilities and equity                                             

    Current liabilities:                                               

      Accounts payable and accrued liabilities $     592   $        581

      Current portion of long-term debt                3              2

        Total current liabilities                    595            583

    Long-term debt, net of current portion (6)       529            532

    Pension and other postretirement benefit
    obligations                                    1,891          1,946

    Deferred income tax liabilities                   28             75

    Other long-term liabilities                       69             72

        Total liabilities                          3,112          3,208

    Commitments and contingencies                                      

    Equity:                                                            

    Common stock                                       -              -

    Additional paid-in capital                     3,746          3,730

    Retained earnings                                 33             38

    Accumulated other comprehensive loss           (613)          (614)

    Treasury stock at cost                          (61)           (61)

      Total Resolute Forest Products Inc.
      shareholders' equity                         3,105          3,093

    Noncontrolling interests                          14             23

      Total equity                                 3,119          3,116

      Total liabilities and equity             $   6,231   $      6,324


                                   RESOLUTE FOREST PRODUCTS INC.

                             CONSOLIDATED STATEMENTS OF CASH FLOWS

                                       (Unaudited, in millions)

                                            Three Months      Three Months

                                          Ended March 31,   Ended March 31,

                                                  2013              2012

    Cash flows from operating activities:                                  

    Net (loss) income including
    noncontrolling interests              $           (5)   $            33

      Adjustments to reconcile net (loss)
      income including non controlling
      interests to net cash (used in)
      provided by operating activities:                                    

      Share-based compensation                          2   $             1

      Depreciation and amortization                    60                57

      Closure costs, impairment and other
      related charges                                  37                 5

      Inventory write-downs related to
      closures                                          4                 -

      Deferred income taxes                          (41)              (14)

      Net pension contributions                      (16)              (18)

      Net gain on disposition of assets                 -              (23)

      Loss (gain) on translation of
      foreign currency denominated
      deferred income taxes                            35              (30)

      (Gain) loss on translation of
      foreign currency denominated
      pension and other postretirement
      benefit obligations                            (35)                24

      Note payable forgiveness gain (3)              (12)                 -

      Other, net                                      (4)                 6

      Changes in working capital:                                          

        Accounts receivable                           (9)                56

        Inventories                                  (43)              (26)

        Other current assets                         (11)               (5)

        Accounts payable and accrued
        liabilities                                    18               (9)

          Net change in working capital              (45)                16

        Net cash (used in) provided by
        operating activities                         (20)                57

    Cash flows from investing activities:                                  

    Cash invested in fixed assets                    (40)              (39)

    Disposition of assets                               2                26

    Decrease in restricted cash                         2                 4

    Decrease (increase) in deposit
    requirements for letters of credit,
    net                                                 1               (7)

        Net cash used in investing
        activities                                   (35)              (16)

    Cash flows from financing activities:                                  

    Payments of debt                                  (1)                 -

    Contribution of capital from
    noncontrolling interest                             8                 -

        Net cash provided by financing
        activities                                      7                 -

    Net (decrease) increase in cash and
    cash equivalents                                 (48)                41

    Cash and cash equivalents:                                             

        Beginning of period                           263               369

        End of period                     $           215   $           410


                                  RESOLUTE FOREST PRODUCTS INC.

       STATEMENTS OF OPERATING INCOME AND NET INCOME ADJUSTED FOR SPECIAL
                                     ITEMS

    A reconciliation of our operating income, net income and net income
    per share reported before special items
    is presented in the tables below. See Note 7 to the Unaudited
    Consolidated Financial Statement Information
    regarding our use of non-GAAP measures.

    Three Months Ended March
    31, 2013
    (unaudited, in millions     Operating
    except per share amounts) income (loss)   Net income (loss)      EPS

    GAAP as reported          $        (50)   $             (5)   $ (0.05)

    Adjustments for special
    items:                                                                

      Foreign currency
      translation loss                    -                   7       0.07

      Closure costs,
      impairment and other
      related charges                    40                  25       0.27

      Inventory write-downs
      related to closures                 4                   2       0.02

      Start up costs of idled
      mill                               15                  11       0.12

      Transaction costs                   3                   3       0.03

      Other income, net                   -                (15)     (0.16)

    GAAP as adjusted for
    special items             $          12   $              28   $   0.30

    Three Months Ended March
    31, 2012
    (unaudited, in millions     Operating
    except per share amounts) income (loss)   Net income (loss)      EPS

    GAAP as reported          $          26   $              23   $   0.23

    Adjustments for special
    items:                                                                

      Foreign currency
      translation gain                    -                (15)     (0.15)

      Severance                           2                   1       0.01

      Closure costs,
      impairment and other
      related charges                     5                   4       0.04

      Net gain on disposition
      of assets                        (23)                (12)     (0.12)

      Post-emergence costs                -                   1       0.01

      Transaction costs                   4                   4       0.04

      Other income, net                   -                 (2)     (0.02)

      Reorganization-related
      and other tax
      adjustments                         -                   3       0.03

    GAAP as adjusted for
    special items             $          14   $               7   $   0.07


                                              RESOLUTE FOREST PRODUCTS INC.

                                      STATEMENTS OF EBITDA AND ADJUSTED EBITDA

    A reconciliation of our net income including noncontrolling interests to EBITDA and
    Adjusted EBITDA is presented in the tables below

    See Note 7 to the Unaudited Consolidated Financial Statement Information regarding our
    use of non-GAAP measures EBITDA and Adjusted EBITDA

    Three Months
    Ended March
    31, 2013                                                            Corporate
    (unaudited, in             Coated   Specialty   Market     Wood        and
    millions)      Newsprint   papers    papers      pulp    products     other     Total

    Net (loss)
    income
    including
    noncontrolling
    interests      $     (2)   $  (3)   $       9   $  (4)   $     16   $    (21)   $  (5)

    Interest
    expense, net                                                               14       14

    Income tax
    benefit                                                                  (41)     (41)

    Depreciation
    and
    amortization          18        9          10       13          9           1       60

    EBITDA                16        6          19        9         25        (47)       28

    Foreign
    currency
    translation
    loss                                                                        5        5

    Closure costs,
    impairment and
    other related
    charges                                                                    40       40

    Inventory
    write-downs
    related to
    closures                                                                    4        4

    Start up costs
    of idled mill                                                              15       15

    Transaction
    costs                                                                       3        3

    Other income,
    net                                                                      (23)     (23)

    Adjusted
    EBITDA         $      16   $    6   $      19   $    9   $     25   $     (3)   $   72

    Three Months
    Ended March
    31, 2012                                                            Corporate
    (unaudited, in             Coated   Specialty   Market     Wood        and
    millions)      Newsprint   papers    papers      pulp    products     other     Total

    Net income
    (loss)
    including
    noncontrolling
    interests      $      21   $  (1)   $      15   $ (21)   $    (6)   $      25   $   33

    Interest
    expense, net                                                               16       16

    Income tax
    benefit                                                                  (10)     (10)

    Depreciation
    and
    amortization          18       10          12        8          9           -       57

    EBITDA                39        9          27     (13)          3          31       96

    Foreign
    currency
    translation
    gain                                                                     (12)     (12)

    Severance                                                                   2        2

    Closure costs,
    impairment and
    other related
    charges                                                                     5        5

    Net gain on
    disposition of
    assets                                                                   (23)     (23)

    Post-emergence
    costs                                                                       2        2

    Transaction
    costs                                                                       4        4

    Other income,
    net                                                                       (3)      (3)

    Adjusted
    EBITDA         $      39   $    9   $      27   $ (13)   $      3   $       6   $   71

 

RESOLUTE FOREST PRODUCTS INC.
Notes to the Unaudited Consolidated Financial Statement Information


    1. Closure costs, impairment and other related charges for the three
       months ended March 31, 2013 and 2012 were comprised of the
       following:

                                              Pension Plan
                                             Settlement and Severance
                                Accelerated   Curtailment   and Other
    (Unaudited, in millions)    Depreciation (Gain) Losses    Costs   Total

    Indefinite idlings:                                                    

      Paper machine in Calhoun,
      Tennessee (1)                     $ 35            $ -       $ 2  $ 37

      Kraft mill and paper
      machine in Fort Frances,
      Ontario                              -              -         4     4

    Other                                  -            (1)         -   (1)

    2013 Total                          $ 35          $ (1)       $ 6  $ 40

    2012 Total                           $ -            $ 4       $ 1   $ 5


    (1) Following our acquisition of the noncontrolling interest in Calhoun
        Newsprint Company ("CNC"), we indefinitely idled a paper machine at
        the Calhoun mill on March 12, 2013, resulting in accelerated
        depreciation charges to reduce the carrying value of the assets to
        reflect their revised estimated remaining useful lives.

    2.  During the three months ended March 31, 2013, we recorded a foreign
        currency translation loss of $5 million. This loss is a result of
        the weaker Canadian dollar relative to the U.S. dollar at March 31,
        2013 and its impact on the translation of our Canadian dollar net
        monetary assets in the Company's principal Canadian operating
        subsidiary.

    3.  Other, net for the three months ended March 31, 2013 and 2012 was
        comprised of the following:

    (Unaudited, in millions)                2013     2012

    Post-emergence costs (1)                   -      (2)

    Income from equity method investments      -        1

    Interest income                            1        1

    Note payable forgiveness gain (2)         12        -

    Gain on liquidation settlement (3)         9        -

    Miscellaneous income                       1        1

                                          $   23   $    1


    (1) Primarily represents ongoing legal and other professional fees for
        the resolution and settlement of disputed creditor claims, as well
        as costs for other post-emergence activities associated with the
        creditor protection proceedings, from which we emerged on December
        9, 2010.

    (2) On March 11, 2013, we acquired the noncontrolling interest in CNC,
        which was previously owned 51% by us and included in our
        consolidated financial statements on a fully consolidated basis. As
        a result, CNC became a wholly-owned subsidiary of ours. In
        connection with this transaction, we recognized a gain on the
        forgiveness of a $12 million note payable issued by CNC. The
        acquisition of the noncontrolling interest in CNC was accounted for
        as an equity transaction.

    (3) On February 2, 2010, Bridgewater Paper Company Limited ("BPCL"), a
        subsidiary of ours, filed for administration in the United Kingdom
        pursuant to the United Kingdom Insolvency Act 1986, as amended. As
        a result, we became a creditor of BPCL and lost control over their
        operations. In connection with our claims, we received a
        liquidation settlement of $9 million in March 2013.

    4.  During three months ended March 31, 2013, we recorded an income tax
        benefit of $41 million. The income tax benefit reflects a reversal
        of $35 million of valuation allowance, mostly related to available
        U.S. capital losses which are now expected to be utilized in the
        future as a result of the acquisition of the noncontrolling
        interest in CNC.

    5.  For the calculation of basic and diluted income per share for the
        three months ended March 31, 2013 and 2012, no adjustments to net
        income attributable to Resolute Forest Products were necessary.

    6.  On April 24, 2013, we launched a private offering for $600 million
        aggregate principal amount of senior notes due 2023 (the "2023
        Notes") and priced the offering of the 2023 notesat 5.875% and
        99.062% of par value on April 26, 2013. The notes will be unsecured
        and guaranteed by substantially all of our wholly-owned U.S.
        subsidiaries. The offering of the 2023 notes is expected to close
        on May 8, 2013, subject to customary closing conditions, with net
        proceeds used to repurchase, repay or otherwise discharge all, or
        substantially all, of the $501 million outstanding aggregate
        principal amount of the 10.25% senior secured notes due 2018 (the
        "2018 Notes").

    7.  Tables represent a reconciliation of certain financial statement
        line items reported under generally accepted accounting principles
        ("GAAP") to our use of non-GAAP measures of operating income
        (loss), net income (loss) and net income (loss) per share, in each
        case adjusted for special items, as well as EBITDA and adjusted
        EBITDA, in each case by reportable segment. We believe that these
        measures are useful because they allow the reader to more easily
        compare our ongoing operations, financial performance and EPS from
        period to period.  They are also consistent with the indicators
        management uses internally to measure our performance. These
        non-GAAP measures should be considered in addition to and not a
        substitute for measures of financial performance calculated and
        presented in accordance with GAAP in our consolidated statement of
        operations in our filings with the Securities and Exchange
        Commission. Consequently, readers should rely on GAAP operating
        income (loss), operating income (loss) by reportable segment, net
        income (loss) and net income (loss) per share. Non-GAAP measures
        included in our press release include:

        Operating income (loss) adjusted for special items - is defined as
        operating income (loss) from our Consolidated Statements of
        Operations excluding special items, such as closure costs,
        impairment and other related charges, severance costs, inventory
        write-downs, start up costs of idled mills, gains and losses on
        dispositions of assets, transaction costs and other charges or
        credits that are excluded from our segment's performance from GAAP
        operating income (loss).

        Net income (loss) adjusted for special items - is defined as net
        income (loss) from our Consolidated Statements of Operations
        excluding the same items as under operating income (loss) adjusted
        for the special items, in addition to the effects of foreign
        currency translation, post-emergence costs, other income (expense)
        and reorganization-related and other tax adjustments.

        Net income (loss) per share (EPS) adjusted for special items - is
        defined as diluted EPS calculated based on the net income (loss)
        adjusted for special items as described above.

        EBITDA by reportable segment - is defined as net income (loss)
        including noncontrolling interests from our Consolidated Statements
        of Operations, allocated to each of our reportable segments
        (newsprint, coated papers, specialty papers, market pulp and wood
        products) in accordance with FASB ASC 290, "Segment Reporting," and
        adjusted for depreciation, amortization and cost of timber
        harvested.  EBITDA for the corporate and other segment  is defined
        as net income (loss) including noncontrolling interests from our
        Consolidated Statements of Operations after the allocation to
        reportable segments, adjusted for interest expense, income taxes
        and depreciation, amortization and cost of timber harvested.

        Adjusted EBITDA - is defined as EBITDA excluding the special items
        described above.

 

 

SOURCE Resolute Forest Products Inc.


Source: PR Newswire