Earnings fall 3 percent at Plum Creek Timber
Plum Creek Timber, a Seattle-based wood products company, said second-quarter earnings were down 3.2 percent to $60 million from $62 million last year. Sales were up 4 percent to $395 million from $380 million in the same period last year.
The company cut its outlook for the rest of the fiscal year, following a lower-than-expected first- and second-quarter performance and a housing market the company expects will be “relatively flat” for the rest of 2007.
“While pulpwood markets remain healthy, sawlog markets continue to bounce along the bottom,” explained president and CEO Rick Holley.
Log prices are expected to be fairly stable across North America, the company said, with any price movements driven by temporary changes in local supply and demand.
In the third quarter, the company said it expects a stronger market in its manufactured wood segment, because of strong pricing and demand for medium density fiberboard (MDF) and improved specialty plywood markets.
Plum Creek Timber owns 8.2 million acres of timberlands in major timber producing regions of the United States, with 10 wood products manufacturing facilities in the Northwest.
PPG to acquire Barloworld Coatings Australia
The Australian subsidiary of Pittsburgh-based PPG will acquire Barloworld Coatings Australia, the architectural paint unit of South Africa-based Barloworld Coatings. Terms of the deal were not disclosed.
Barloworld is a leading manufacturer of architectural and decorative paints in Australia, with brands including Taubmans, Bristol and White Knight. The company also operates production facilities in Villawood, New South Wales; and Glen Waverly, Victoria.
Barloworld’s plant in Glen Waverley will not be acquired by PPG but will continue to manufacture Barloworld brand products for PPG until production and distribution activities are transferred to other locations, PPG said in a statement.
Barloworld also distributes products through 85 company-owned stores, a network of distributors and numerous independent retailers. The paints are also sold through Bunnings, one of Australia’s largest home improvement retailers.
“We are continuing to accelerate our profitable growth in coatings by making strategic acquisitions,” said J. Rich Alexander, senior vp-coatings for PPG. “The Barloworld coatings brands are well-respected in Australia. By acquiring Barloworld’s Australian coatings business, we’ll be well-positioned to be the leading coatings manufacturer operating in all market segments and channels in Australia.”
In 2006, PPG acquired Protec, an Adelaide, Australia-based manufacturer and distributor of automotive refinish coatings and light industrial and high-performance coatings. Also in 2006, PPG acquired the Performance Coatings and Finishes business of Ameron International of Pasadena, Calif., which also has operations in Australia and New Zealand.
British Columbia forestry workers go on strike
Around 6,500 members of Canada’s Wood Council of the United Steelworkers union (USW) have gone on strike in British Columbia.
The strike began at midnight on Friday, idling more than 30 forest companies, according to news reports.
At issue is a request by the USW to restrict wood product companies’ abilities to schedule some working shifts up to 12 hours long. Additionally, the union is arguing for better severance pay for partial mill closures.
“The industry is badly fragmented and is unable to reach common ground with our union on the fundamental issues affecting our members,” said Steve Hunt, director of USW Western Canada.
The union is striking against several companies, many represented by the bargaining group Forest Industrial Relations (FIR). Around 4,500 unionized workers are employed by FIR’s client companies.
“We have bargained in good faith, and the union has been effective in achieving many of its goals,” said Terry Lineker, president and CEO of FIR. “However, given the market pressures we face, we will not offer more because any further decline in our competitive position will severely damage the industry.”
FIR members include West Fraser Mills and Western Forest Products.