Clearwater Paper Reports 2nd Quarter Earnings
July 29, 2010 - Clearwater Paper Corp. today reported financial results for the second quarter ended June 30, 2010. The company reported net earnings for the second quarter of 2010 of $20.6 million, or $1.75 per diluted common share, compared to net earnings of $75.4 million, or $6.43 per diluted common share, for the second quarter of 2009. Second quarter 2009 results included special items totaling $4.60 per share for alternative fuel mixture tax credits, renewable energy tax credits and debt retirement costs. Excluding those items, second quarter 2009 diluted earnings were $1.83 per share.
"Second quarter revenues were solid for both Consumer Products and Pulp and Paperboard. Strong demand from our customers across our businesses as well as solid operating performance resulted in strong earnings for the quarter," said Gordon Jones, chairman, president and chief executive officer. "To better meet demand in our Consumer Products segment, we broke ground in early July on our converting facility at Shelby, North Carolina. We are pleased with the Shelby site as the home of our expanded papermaking and converting operations."
SECOND QUARTER 2010 SEGMENT PERFORMANCE
Operating income for the second quarter of 2010 was $20.8 million, compared with operating income of $32.2 million for the second quarter of 2009. Net sales of $145.4 million for the quarter were 4.3% higher than second quarter 2009 net sales of $139.4 million.
- The increase in net sales was driven by a 7.2% increase in volume, partially offset by 2.7% lower net selling prices driven by increased customer product promotions.
- Operating income was lower as a result of significantly higher pulp costs.
Pulp and Paperboard
For the second quarter of 2010 the segment had operating income of $27.5 million, compared to operating income of $83.3 million for the second quarter of 2009, which included $76.4 million associated with alternative fuel mixture tax credits. Net sales of $217.9 million for the quarter were up 14.9% compared to second quarter 2009 net sales of $189.7 million.
- Higher net sales for the quarter were primarily the result of paperboard volume increases and higher pulp prices.
- Paperboard shipments increased by 8,800 tons, or 4.9%, and paperboard net selling prices also improved 3.5% compared to second quarter 2009.
- Market pulp pricing increased by 78.2% and shipments to third parties decreased to 13,307 tons as compared to 19,038 tons in second quarter 2009, primarily due to less production and more internal consumption.
The company's effective income tax rate for the second quarter of 2010 was 38.0% compared to 23.3% for the same period last year. The tax rate for the second quarter of 2009 included alternative fuel mixture tax credits and tax benefits from renewable energy tax credits. The annual estimated effective tax rate for 2010, excluding discrete items, is approximately 34.8%.
Clearwater Paper manufactures premium consumer tissue, high-quality bleached paperboard and wood products at six facilities across the United States.
SOURCE: Clearwater Paper Corp