Tembec, the Montreal-based forest products company, reported sales of $545 million Canadian dollars (US$547.7 million) for the first quarter ended Dec. 29, 2007, down 16 percent from C$649 million in the same period last year.
The company posted a net loss of C$60 million for the quarter, compared to net earnings of C$138 million in the same quarter ended Dec. 30, 2006. The previous-year earnings were boosted by C$185 million in refunded lumber duty payments following the Canadian-U.S. softwood lumber tariff dispute settlement.
“Overall, the December quarter operating results were below the company’s expectations. It will continue to focus on controllable items such as costs and operating efficiency, the key elements of its recovery plan,” according to a press release from the company.
The company cited several factors in explaining the current results, especially the soft lumber market conditions and the declining value of the U.S. dollar versus the Canadian dollar. The company also said that it was recapitalizing its credit structure so as to reduce annual interest payments.
Tembec employs about 8,000 people and has operations in North America and France.