Cascades Continues to Implement Strategic Measures and Announces Third Quarter Results

KINGSEY FALLS, QC, Nov. 10, 2011 /CNW Telbec/ - Cascades Inc. (TSX: CAS), a leader in the recovery of recyclable materials and the manufacturing of green packaging and tissue paper products, announces its financial results for the three-month and nine-month periods ended September 30, 2011

Commenting on the third quarter results and recent strategic actions, Mr. Alain Lemaire, President and Chief Executive Officer stated: "Although we are still looking for stronger results, overall, we are encouraged by our performance during the past three months. For a second consecutive quarter, our operating results continued to move in a positive direction. Three of our four segments posted an improvement in their quarterly sequential financial performance, and the several proactive measures taken to address our lesser-performing units have continued to pay off.

Moreover, in the face of ever more volatile markets and economic conditions, we have continued to refine our strategic goals. In the coming quarters, we will pursue the implementation of initiatives aimed at improving our competitive position through enhanced productivity and profitability. The Greenpac containerboard mill, the acquisition of Papersource, the sale of our Burnaby mill and the closure of our Le Gardeur plant are prime examples of these measures. We are highly confident that these measures will have a positive impact on our financial performance on both the near and long term".


Third Quarter 2011 Strategic Highlights

  • Modernization measures:
    • Construction kick-off for the new, state-of-the-art, Greenpac containerboard mill.
    • Acquisition of the remaining 50% of the shares of Papersource, a leading tissue paper converter (effective in November 2011). This transaction should add more than $125 million to Cascades' annual sales and have an immediate positive impact on net profitability.
  • Restructuration and optimization measures:
    • Closure of the Burnaby (British Columbia) containerboard mill and divestiture of the land and building for $20 million (effective in October 2011).
    • Closure of the Le Gardeur corrugated box plant (effective in Q4 2011).

Third Quarter 2011 Financial Highlights

  • Improved operating results compared to Q2 2011, in spite of the increase in average raw material costs and the production interruption following a flood in one of our tissue mills.
  • 27% sequential increase ($17 million) in operating income before depreciation and amortization (EBITDA), excluding specific items. 
  • Significant F/X gains on working capital items and on our cash management following the divestiture of Dopaco.
  • Almost fourfold increase in cash flow from operations in comparison to Q2 2011.
  • Notwithstanding significant improved operating results compared to the previous quarter, net loss per share, excluding specific items, of $0.05 given tax adjustments of approximately $7 million ($0.07 per share).
  • Net loss per share, including specific items, of $0.20, mostly reflecting net impairment losses and unrealized losses on financial instruments (both non-cash items).
  • 761,600 shares bought back (1% of shares outstanding) at an average price of $4.90.


Financial Summary

Selected consolidated information      
(in millions of Canadian dollars, except amounts per share) Q3/2011 Q3/2010 Q2/2011
       
Sales 947 832 991
Excluding specific items 1      
  Operating income before depreciation and amortization (OIBD or EBITDA)  79 94 62
  Operating income  34 54 15
  Net earnings (loss) (5) 33 (6)
    per common share $(0.05) $0.35 $(0.06)
  Cash flow from operations (adjusted)  61 72 17
As reported      
Operating income before depreciation and amortization (OIBD or EBITDA) 1 53 72 65
Operating income 8 32 18
Net earnings (loss) (19) 24 117
  per common share $(0.20) $0.25 $1.21
Cash flow from operations (adjusted)  1 60 71 16
Note 1 - see the supplemental information on non-IFRS measures.      

Results Analysis for the three-month period ended September 30, 2011 (compared to the same period of the previous year)

In the third quarter of 2011, the financial results and balance sheet reflect the full consolidation2 of Reno De Medici's ("RdM"), the second largest European producer of coated recycled boxboard.

In comparison with the same period last year, sales rose by 14% to $947 million as of result of higher selling prices and the full consolidation of RdM. These factors were partly offset by the 6% appreciation of the Canadian dollar, the impact of the divestiture of three facilities and the closure of one box plant, as well as by slightly lower shipments.

Operating income, excluding specific items, amounted to $34 million compared to $54 million in Q3 2010. The full consolidation of RdM and the significant F/X gains on our cash management and working capital items, were more than offset by the major rise of all main variable costs, namely recycled fibre, pulp, energy, chemical products and freight. Also, our profitability was negatively impacted by lower selling prices in Canadian dollars and the flood related 17 day closure of one of our tissue mills. When including specific items, the operating income amounted to $8 million in comparison to $32 million in the same period last year.   

On a segmented basis, all groups were negatively affected by variable cost inflation. However, our tissue paper, boxboard and specialty paper segments benefited from higher selling prices. Also, our boxboard segment posted improved profitability mostly due to the full consolidation of RdM.

In the third quarter of 2011, the following specific items impacted operating income and/or net earnings (before tax):

  • a $14 million net impairment loss related to restructuring actions (impact on operating income and net earnings);
  • a $11 million unrealized loss on financial instruments (impact on operating income and net earnings);
  • $1 million in closure and restructuring costs (impact on operating income and net earnings);
  • a $5 million foreign exchange gain on long-term debt and financial instruments (impact on net earnings);
  • a $4 million after-tax loss resulting from definitive closing price adjustments on the divestiture of Dopaco (discontinued operations, impact on net earnings);
  • a $1 million gain included in the share of results of associates, joint ventures and non-controlling interest (impact on net earnings)

For further details, see the two following tables on IFRS and non-IFRS measures reconciliation.

The net loss excluding specific items amounted to $5 million ($0.05 per share) in the third quarter of 2011 compared to net earnings of $33 million ($0.35 per share) for the same period of last year. During the period, our net results were significantly impacted by tax adjustments (approximately $7 million, $0.07 per share). Including specific items, the net loss amounted to $19 million ($0.20 per share) compared to net earnings of $24 million ($0.25 per share) for the same quarter in 2010.

Compared to September 30, 2010, the net debt decreased by 7% to $1,360 million. However, this amount includes the consolidation of RdM's net debt of $148 million, which is without recourse to Cascades. Excluding RdM's net debt, Cascades' net debt would have amounted to $1,212 million on September 30, 2011, a decline of $250 million (17%) relative to September 30, 2010.

Results Analysis for the three-month period ended September 30, 2011 (compared to the second quarter of 2011)

In comparison to the previous quarter, sales decreased 4% mostly due the unfavourable seasonality in our European boxboard operations and the divestiture of two North American boxboard facilities. Nonetheless, the operating income improved mainly as a result of the strategic actions implemented (divestiture and closure), higher selling prices, and F/X gains on our cash management following the sale of Dopaco. All this more than offset the rise of our recycled fibre costs and lower shipments in our European boxboard operations.

In comparison to the second quarter of 2011, net debt increased by $72 million, of which more than 80% ($59 million) is due to the decrease of the Canadian dollar at the end of the period.

Near-term Outlook

Mr. Alain Lemaire, President and Chief Executive Officer added: "Looking ahead to the next quarter, we are quite encouraged by the recent substantial drop in recycled fibre costs and the depreciation of the Canadian dollar. This should help to offset the traditional seasonal decrease in demand in most of our sectors, and the negative impact of the economic instability on our European operations. To conclude, we anticipate that our results will be positively impacted by the implementation of selling price increases in our tissue paper segment and the realization of our restructuring actions".

Dividend on Common Shares and Normal Course Issuer Bid

The Board of Directors of Cascades declared a quarterly dividend of $0.04 per share to be paid December 14, 2011 to shareholders of record at the close of business on December 2, 2011. This dividend paid by Cascades is an "eligible dividend" as per the Income Tax Act (Bill C-28, Canada). In addition, in the third quarter of 2011, in accordance with its normal course issuer bid program, Cascades purchased for cancellation 761,600 shares at an average price of $4.90 representing an aggregate amount of approximately $3.7 million. In the first nine months of the year, Cascades purchased for cancellation 1,338,063 shares at an average price of $5.72 representing an aggregate amount of approximately $7.7 million.

Transition to International Financial Reporting Standards (IFRS)

All financial information, including comparative figures pertaining to Cascades' 2010 results, has been prepared in accordance with International Financial Reporting Standards (IFRS). Until the first quarter of 2011, the Corporation prepared its consolidated financial statements and interim financial statements in accordance with Canadian generally accepted accounting principles (GAAP). Comparative figures presented pertaining to Cascades' 2010 results have been restated to be in accordance with IFRS. A reconciliation of certain comparative figures from previous GAAP to IFRS is provided in the Third Quarter results investor presentation. For further details, please refer to the investor presentation on the impact of adoption of IFRS, the third quarter 2011 report and the 2010 annual report. These documents are available at www.cascades.com/investors.

Supplemental information on non-IFRS measures

Operating income before depreciation and amortization, earnings before interests, taxes, depreciation and amortization, operating income and cash flow from operations are not measures of performance under IFRS. The Corporation includes operating income before depreciation and amortization, earnings before interests, taxes, depreciation and amortization, operating income and cash flow from operations because they are measures used by management to assess the operating and financial performance of the Corporation's operating segments. Additionally, the Corporation believes that these items provide additional measures often used by investors to assess a corporation's operating performance and its ability to meet debt service requirements. However, operating income before depreciation and amortization, earnings before interests, taxes, depreciation and amortization, operating income and cash flow from operations do not represent, and should not be used as a substitute for net earnings or cash flows from operating activities as determined in accordance with IFRS, and they are not necessarily an indication of whether cash flow will be sufficient to fund our cash requirements. In addition, our definition of operating income before depreciation and amortization, earnings before interests, taxes, depreciation and amortization, operating income and cash flow from operations may differ from those of other companies. Cash flow from operations is defined as cash flow from operating activities as determined in accordance with IFRS excluding the change in working capital components.

Operating income before depreciation and amortization excluding specific items, earnings before interests, taxes, depreciation and amortization excluding specific items, operating income excluding specific items, net earnings excluding specific items, net earnings per common share excluding specific items and cash flow from operations excluding specific items are non-IFRS measures. The Corporation believes that it is useful for investors to be aware of specific items that have adversely or positively affected its IFRS measures, and that the above mentioned non-IFRS measures provide investors with a measure of performance  with which to compare its results between periods without regard to these specific items. The Corporation's measures excluding specific items have no standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation.

Specific items are defined to include charges for impairment of assets, charges for facility or machine closures, debt restructuring charges, gains or losses on sale of business unit, unrealized gains or losses on derivative financial instruments that do not qualify for hedge accounting, foreign exchange gains or losses on long-term debt and other significant items of an unusual or non-recurring nature.

Net earnings (loss), which is a performance measure defined by IFRS is reconciled below to operating income, operating income excluding specific items and operating income before depreciation excluding specific items or earnings before interests, taxes, depreciation and amortization excluding specific items:

   
(in millions of Canadian dollars) Q3/2011 Q3/2010 Q2/2011
       
Net earnings (loss) (19) 24 117
Net loss (earnings) from discontinued operations 3 (8) (108)
Non-controlling interest (4) - 1
Share of results of associates and joint ventures (1) (16) (2)
Provision for (recovery of) income taxes 9 1 (22)
Foreign exchange loss (gain) on long-term debt and financial instruments (5) 4 5
Financing expense 25 27 27
  
Operating income 8 32 18
Specific items :      
Inventory adjustment resulting from business acquisition - - 6
Loss (gain) on disposal and others - 15 (8)
Net impairment loss  14 1 -
Closure and restructuring costs 1 1 1
Unrealized loss (gain) on financial instruments 11 5 (2)
  26 22 (3)
   
Operating income - excluding specific items 34 54 15
Depreciation and amortization 45 40 47
Operating income before depreciation and amortization (OIBD or EBITDA) - excluding specific items 79 94 62

The following table reconciles net earnings (loss) and net earnings (loss) per share to net earnings (loss) excluding specific items and net earnings (loss) per share excluding specific items:  

       
(in millions of Canadian dollars, except amounts per share) Net earnings (loss)    Net earnings (loss) per share 1
  Q3/2011 Q3/2010 Q2/2011   Q3/2011 Q3/2010 Q2/2011
               
As per IFRS (19) 24 117   $(0.20) $0.25 $1.21
Specific items : -            
Inventory adjustment resulting from business acquisition - - 6   $ - $ - $0.04
Loss (gain) on disposal and others - 15 (8)   $(0.01) $0.12 $(0.22)
Net impairment loss  14 1 -   $0.11 $0.01 $ -
Closure and restructuring costs 1 1 1   $0.01 $0.01 $0.01
Unrealized loss (gain) on financial instruments 11 5 (2)   $0.10 $0.05 $(0.02)
Foreign exchange loss (gain) on long-term debt and financial instruments (5) 4 5   $(0.05) $0.03 $0.05
Share of results of associates, joint ventures and non-controlling interests (1) (11) -   $(0.01) $(0.12) $ -
Included in discontinued operations, net of income tax 4 - (110)   $0.04 $ - $(1.13)
Tax effect on specific items and other tax adjustments (10) (6) (15)   $(0.04) $ - $ -
  14 9 (123)   $0.15 $0.10 $(1.27)
Excluding specific items (5) 33 (6)   $(0.05) $0.35 $(0.06)
Note 1 - Tax effect on specific items and other tax adjustments, per share, only includes the impact of tax adjustments.

The following table reconciles cash flow (adjusted) from operations activities to cash flow from operations excluding specific items:

   
  Cash flow from operations
(in millions of Canadian dollars) Q3/2011 Q3/2010 Q2/2011
       
Cash flow provided by (used from) operating activities 41 60 (27)
Changes in non-cash working capital components 19 11 43
Cash flow (adjusted) from operations 60 71 16
Specific items, net of current income taxes :      
Closure and restructuring costs 1 1 1
Excluding specific items 61 72 17

 

Consolidated Balance Sheets    
(in millions of Canadian dollars) (unaudited) September 30,
2011
December 31,
2010
Assets    
Current assets    
Cash and cash equivalents 11 6
Accounts receivable 662 490
Current income tax assets 26 21
Inventories 526 476
Financial assets 8 12
  1,233 1,005
Long-term assets    
Investments in associates and joint ventures 241 262
Property, plant and equipment 1,695 1,553
Intangible assets 133 126
Financial assets 24 2
Other assets 113 94
Deferred income tax assets 60 82
Goodwill 297 313
  3,796 3,437
Liabilities and Shareholders' Equity    
Current liabilities    
Bank loans and advances 111 42
Accounts payable and accrued liabilities 603 440
Current income tax liabilities 76 2
Provisions for contingencies and charges 24 23
Current portion of financial liabilities and other liabilities 23 14
Current portion of long-term debt 37 7
Revolving credit facility, renewed in 2011 - 394
  874 922
Long-term liabilities    
Long-term debt 1,223 960
Provisions for contingencies and charges 40 37
Financial liabilities 94 83
Other liabilities 211 196
Deferred income tax liabilities 110 167
  2,552 2,365
     
Equity attributable to Shareholders    
Capital stock 489 496
Contributed surplus 13 14
Retained earnings 655 576
Accumulated other comprehensive loss (54) (37)
  1,103 1,049
Non-controlling interest 141 23
Total equity 1,244 1,072
  3,796 3,437

Consolidated Statements of Earnings        
  For the 3-month periods ended
September 30,
For the 9-month periods ended
September 30,
(in millions of Canadian dollars, except per share amounts and
number of shares) (unaudited)
2011 2010 2011 2010
Sales 947 832 2,712 2,399
Cost of sales and expenses        
Cost of sales (excluding depreciation and amortization) 801 653 2,300 1,912
Depreciation and amortization 45 40 128 117
Selling and administrative expenses 91 82 265 246
Loss (gain) on disposal and others - 15 (7) 15
Net impairment loss and other restructuring costs 15 2 20 2
Foreign exchange loss (gain) (22) 3 (21) 4
Loss on financial instruments 9 5 7 7
  939 800 2,692 2,303
Operating income 8 32 20 96
Financing expense 25 27 77 81
Loss on refinancing of long-term debt - - - 3
Foreign exchange loss (gain) on long-term debt and financial instruments (5) 4 5 (1)
  (12) 1 (62) 13
Provision for (recovery of) income taxes 9 1 (27) 2
Share of results of associates and joint ventures (1) (16) (11) (23)
Net earnings (loss) from continuing operations including
non-controlling interest for the period
(20) 16 (24) 34
Net earnings (loss) from discontinued operations for the period (3) 8 111 20
Net earnings (loss) including non-controlling interest for
the period
(23) 24 87 54
Less: Non-controlling interest (4) - (3) 1
Net earnings (loss) attributable to Shareholders for
the period
(19) 24 90 53
         
Net earnings (loss) from continuing operations per
common share
       
  Basic (0.17) 0.17 (0.22) 0.35
  Diluted (0.17) 0.17 (0.22) 0.34
Net earnings (loss) per common share        
  Basic (0.20) 0.25 0.93 0.55
  Diluted (0.20) 0.24 0.93 0.54
Weighted average basic number of common shares
outstanding
95,986,989 96,645,061 96,317,941 96,874,069

Consolidated Statements of Comprehensive Income (Loss)        
  For the 3-month periods ended
September 30,
For the 9-month periods ended
September 30,
(in millions of Canadian dollars) (unaudited) 2011 2010 2011 2010
Net earnings (loss) including non-controlling interest for the period (23) 24 87 54
Other comprehensive income (loss)        
  Translation adjustments        
    Change in foreign currency translation of foreign subsidiaries 31 (7) 7 (18)
    Change in foreign currency translation related to net investment hedging activities (33) 17 (14) 9
    Income taxes 8 (3) 2 (2)
  Cash flow hedges        
    Change in fair value of foreign exchange forward contracts (2) 3 (5) 1
    Change in fair value of interest rate swap agreements (8) - (9) (3)
    Change in fair value of commodity derivative financial instruments (1) (11) - (21)
    Income taxes 3 2 3 7
    Actuarial loss on post-employment benefit obligations, net of related income taxes of $ 14 million (39) - (39) -
  Available-for-sale financial assets (1) - (1) -
  (45) (1) (56) (27)
Comprehensive income (loss) including non-controlling interest for
the period
(68) 25 31 27
Less: Comprehensive income (loss) attributable to non-controlling
interest for the period
(4) - (8) 1
Comprehensive income attributable to Shareholders (64) 25 34 26

Consolidated Statements of Equity               
  For the 9-month period ended September 30, 2011
(in millions of Canadian dollars) (unaudited) Capital
stock
Contributed
surplus
Retained
earnings
Accumulated
other
comprehensive
loss
Total equity
attributable to
Shareholders
Non-controlling
interest
Total
equity
Balance - Beginning of period 496 14 576 (37) 1,049 23 1,072
  Net earnings for the period - - 90 - 90 (3) 87
  Business acquisitions - - - - - 124 124
  Other comprehensive loss - - - (17) (17) - (17)
  Dividends - - (12) - (12) - (12)
  Redemption of common shares (7) (1) - - (8) - (8)
  Acquisition of non-controlling interest - - 1 - 1 (2) (1)
  Dividend paid to non-controlling interest - - - - - (1) (1)
Balance - End of period 489 13 655 (54) 1,103 141 1,244
               
               
  For the 9-month period ended September 30, 2010
(in millions of Canadian dollars) (unaudited) Capital
stock
Contributed
surplus
Retained
earnings
Accumulated
other
comprehensive
income (loss)
Total equity
attributable to
Shareholders
Non-controlling
interest
Total
equity
Balance - Beginning of period 499 14 575 3 1,091 21 1,112
  Net earnings for the period - - 53 - 53 1 54
  Other comprehensive loss - - - (27) (27) - (27)
  Dividends - - (12) - (12) - (12)
  Stock options - 1 - - 1 - 1
  Redemption of common shares (3) (1) - - (4) - (4)
Balance - End of period 496 14 616 (24) 1,102 22 1,124

Consolidated Statements of Cash Flows         
  For the 3-month periods ended
September 30,
For the 9-month periods ended
September 30,
(in millions of Canadian dollars) (unaudited) 2011 2010 2011 2010
Operating activities from continuing operations        
Net earnings (loss) attributable to Shareholders for the period (19) 24 90 53
Net loss (earnings) from discontinued operations for the period 3 (8) (111) (20)
Net earnings (loss) from continuing operations (16) 16 (21) 33
Adjustments for        
  Financing expense 25 27 77 81
  Depreciation and amortization 45 40 128 117
  Loss (gain) on disposal and others - 15 (7) 15
  Net impairment loss and other restructuring costs 14 1 18 1
  Unrealized loss on financial instruments 11 5 11 8
  Foreign exchange loss (gain) on long-term debt and financial instruments (5) 4 5 (1)
  Provision for (recovery of) income taxes 9 1 (27) 2
  Share of results of associates and joint ventures (1) (16) (11) (23)
  Non-controlling interest (4) - (3) 1
  Financing expense paid (14) (17) (65) (62)
  Income tax paid (4) (2) (13) (10)
  Others - (3) (1) (10)
  60 71 91 152
Changes in non-cash working capital components (19) (11) (89) (72)
  41 60 2 80
Investing activities from continuing operations        
Purchase of investment in associates and joint ventures (45) (5) (45) (6)
Purchases of property, plant and equipment (23) (19) (80) (67)
Change in other assets (10) (11) (43) (21)
Proceeds on sale of other assets 50 - 50 -
Business acquisitions, net of cash acquired (3) - (4) (3)
Business dispositions, net of cash disposed - - 6 -
  (31) (35) (116) (97)
Financing activities from continuing operations        
Bank loans and advances 6 (2) 29 5
Change in revolving credit facilities (9) (26) (266) 175
Purchase of senior notes - - - (165)
Increase in other long-term debt - - 1 -
Payments of other long-term debt (4) (1) (13) (5)
Redemption of common shares (4) - (8) (4)
Acquisition of and dividend paid to non-controlling interest (2) - (2) -
Dividend paid to Corporation's Shareholders (4) (4) (12) (12)
  (17) (33) (271) (6)
Change in cash and cash equivalents during the period
from continuing operations
(7) (8) (385) (23)
Change in cash and cash equivalents from discontinued operations,
including proceeds on disposal during the period
- 9 390 30
Net change in cash and cash equivalents during the period (7) 1 5 7
Cash and cash equivalents—Beginning of period 18 14 6 8
Cash and cash equivalents—End of period 11 15 11 15
         
         
Segmented Information        
  SALES
  For the 3-month periods ended 
September 30,
For the 9-month periods ended 
September 30,
(in millions of Canadian dollars) (unaudited) 2011 2010 2011 2010
Packaging products        
Boxboard        
  Manufacturing 263 116 711 350
  Converting 32 160 257 472
  Intersegment sales (6) (10) (30) (30)
  Discontinued operations of converting segment - (119) (148) (350)
  289 147 790 442
Containerboard        
  Manufacturing 117 155 372 437
  Converting 210 227 609 638
  Intersegment sales (78) (90) (235) (257)
  249 292 746 818
Specialty products        
  Industrial packaging 31 30 92 85
  Consumer packaging 27 21 73 59
  Specialty papers 73 74 218 230
  Recovery and recycling 97 73 271 218
  Intersegment sales (4) (3) (9) (7)
  224 195 645 585
Intersegment sales (27) (26) (85) (77)
  735 608 2,096 1,768
Tissue papers        
  Manufacturing and converting 221 226 638 641
Intersegment sales and others (9) (2) (22) (10)
Total 947 832 2,712 2,399
         
         
  Operating income before depreciation and amortization
  For the 3-month periods ended
September 30,
For the 9-month periods ended
September 30,
(in millions of Canadian dollars) (unaudited) 2011 2010 2011 2010
Packaging products        
Boxboard        
  Manufacturing 7 4 20 19
  Converting - 16 13 49
  Others - (8) - (10)
  Discontinued operations of converting segment - (15) (12) (43)
  7 (3) 21 15
Containerboard        
  Manufacturing 2 29 12 55
  Converting 23 24 51 71
  Others (7) 1 (2) (4)
  18 54 61 122
Specialty products        
  Industrial packaging 3 4 7 11
  Consumer packaging 2 2 5 5
  Specialty papers (4) 6 (5) 17
  Recovery and recycling 9 6 21 18
  Others (1) - - -
  9 18 28 51
  34 69 110 188
Tissue papers        
  Manufacturing and converting 17 25 43 67
Corporate 2 (22) (5) (42)
Operating income before depreciation and amortization 53 72 148 213
Depreciation and amortization        
Boxboard (12) (9) (33) (27)
Containerboard (15) (18) (46) (52)
Specialty products (7) (6) (21) (20)
Tissue papers (9) (10) (28) (30)
Corporate and eliminations (2) (3) (6) (6)
Discontinued operations of Boxboard converting segment - 6 6 18
  (45) (40) (128) (117)
Operating income 8 32 20 96
         
         
  Purchases of property, plant and equipment
  For the 3-month periods ended
September 30,
For the 9-month periods ended
September 30,
(in millions of Canadian dollars) (unaudited) 2011 2010 2011 2010
Packaging products        
Boxboard        
  Manufacturing 10 2 27 6
  Converting - 3 2 10
  Discontinued operations of converting segment - (2) (1) (8)
  10 3 28 8
Containerboard        
  Manufacturing 2 - 5 10
  Converting 10 5 19 12
  12 5 24 22
Specialty products        
  Industrial packaging 1 - 2 -
  Consumer packaging 2 2 3 4
  Specialty papers 1 2 5 5
  Recovery and recycling 2 1 5 3
  6 5 15 12
  28 13 67 42
Tissue papers        
  Manufacturing and converting 2 12 17 22
         
Corporate 2 8 4 15
Total purchases 32 33 88 79
         
Disposal of property, plant and equipment (8) (4) (10) (7)
Acquisition under capital-lease agreement - (4) - (4)
  24 25 78 68
Purchases of property, plant and equipment included in
accounts payable
       
  Beginning of period 15 8 18 13
  End of period (16) (14) (16) (14)
Total investing activities 23 19 80 67

 _______________________________

2 Cascades' ownership in RdM stood at 42.2% at the end of Q3 2011. In addition to this stake, Cascades also has a call option over RdM shares by virtue of which we are entitled to acquire up to a maximum 9.07% of its current shares outstanding. Considering these facts, starting in the second quarter of 2011, Cascades' consolidated figures include those of RdM at 100% and net results are reported net of non-controlling interests. Prior to the second quarter, Cascades' investment in RdM was accounted for using the equity method.

 

 

 

 

 

SOURCE CASCADES INC.

For further information:

Media
Hubert Bolduc 
Vice-President, Communications and Public Affairs 
514 912-3790 
       Source:
Allan Hogg
Vice-President and Chief Financial Officer
Investors
Didier Filion
Director, Investor relations
514 282-2697
   

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