April 18, 2014 6:23 PM ET

Paper and Forest Products

Company Overview of Catalyst Paper Corporation

Company Overview

Catalyst Paper Corporation, together with its subsidiaries, produces and sells mechanical printing papers in western North America. The company operates through three segments: Specialty Printing Papers, Newsprint, and Pulp. The Specialty Printing Papers segment provides coated mechanical, uncoated mechanical, directory, and soft-calendared mechanical papers for retailers, commercial printers, and telephone directory publishers, as well as magazine and catalogue publishers. This segment sells its products through marketing personnel in North America, as well as through distributors and agents in other geographic markets. The Newsprint segment provides newsprint primarily for newspaper publis...

3600 Lysander Lane

2nd Floor

Richmond, BC V7B 1C3

Canada

Founded in 1946

1,550 Employees

Phone:

604-247-4400

Fax:

604-247-0512

Key Executives for Catalyst Paper Corporation

Chief Executive Officer
Age: 48
Total Annual Compensation: $157.0K
Chief Financial Officer
Age: 46
Total Annual Compensation: $290.0K
Senior Vice President of Human Resources
Age: 57
Total Annual Compensation: $250.0K
Compensation as of Fiscal Year 2013.

Catalyst Paper Corporation Key Developments

Catalyst Paper Completes CAD 20 Million Term Loan Maturing July 31, 2017

Catalyst Paper announced that it has completed the CAD 20 million term loan maturing July 31, 2017 it announced earlier in March. The proceeds of the term loan are being used to redeem the remaining USD 19.4 million of the company’s outstanding floating rate senior secured notes due 2016. The term loan was provided by the same lenders who participate in the company’s asset based loan facility and is secured by a charge on the assets of the company and its subsidiaries that secures the company’s PIK Toggle senior secured notes due 2017. The charge securing the term loan ranks senior to the charge securing the 2017 Notes. The term loan provides for principal repayments of CAD 500,000 each quarter and can be prepaid in whole or in part at any time without premium. By replacing the floating rate notes with the term loan, the company reduced its outstanding secured debt by approximately USD 1.4 million and will reduce its annual interest costs by approximately USD 1.4 million. The quarterly principal payments to be made by the company under the term loan will reduce the company’s outstanding secured debt by a total of CAD 6.0 million during the term of the term loan.

Catalyst Paper Reaches Agreement on Term Loan to Refinance Senior Secured Floating Rate Notes

Catalyst Paper announced that it has entered into a commitment letter with a Canadian chartered bank for a CAD 20 million term loan maturing on July 31, 2017. The Term Loan will be used to retire the remaining USD 19.4 million of outstanding Senior Secured Floating Rate Notes due 2016 (Floating Rate Notes). The transaction has the requisite approval of holders of Catalyst's PIK Toggle Senior Secured Notes due 2017. The Term Loan will be provided by the lenders who participate in Catalyst's asset based loan facility and will be secured by a charge on the assets of Catalyst and its subsidiaries that secures the 2017 Notes. The charge will rank senior to the charge securing the 2017 Notes. The Term Loan can be prepaid in whole or in part at any time without premium. The Term Loan is subject to completion of documentation and certain other conditions. The new Term Loan replaces the high interest rate under the Floating Rate Notes with a commercial interest rate and provides the company with greater flexibility.

Catalyst Paper Corporation Reports Earnings Results for the Fourth Quarter and Full Year of 2014; Reports Production Results for the Full Year of 2014; Provides Capital Spending Guidance for 2014; Reports Impairment Charge for Fourth Quarter of 2014

Catalyst Paper Corporation reported earnings results for the fourth quarter and full year of 2014. For the quarter, the company reported adjusted EBITDA of $19.1 million versus $16.4 million in third quarter, despite higher production costs related to an annual maintenance shut at the Crofton pulp mill. As well paper productivity improved by 3,600 tonnes over the previous quarter. In fourth quarter, free cash flow of $5.9 million was positive for the second consecutive quarter. The company recorded a net loss of $95 million compared to net earnings of $5.2 million in third quarter. The net loss was mainly driven by an adjustment to the carrying value of goodwill and fixed assets to reflect a non-cash impairment charge of $86.9 million required under U.S. GAAP. Excluding specific items net earnings were $1.7 million versus a net loss of $3.5 million the previous quarter. Sales were higher at $272.1 million compared to $268.8 million in the previous quarter, driven by higher pulp and paper prices and a weakening Canadian dollar. Capital expenditures were $3.7 million, $1.6 million lower than the previous quarter. Adjusted EBITDA for the year was $46.1 million in 2013 compared to $55.4 million in 2012, primarily due to higher power rates plus the reintroduction of the Provincial Sales Tax on purchased electricity. Total sales were $1,051.4 million, marginally below $1,058.2 million in 2012. Net earnings before specific items improved relative to the previous year by $6.3 million mostly due to a significant reduction in interest expense resulting from the reorganization of debt in 2012. Net earnings moved from $583.2 million in 2012 to a loss of $127.6 million in 2013. Net earnings in the prior year reflect one-time reorganization and fresh start accounting adjustments made upon exiting creditor protection (CCAA) of $667.5 million, while the 2013 loss reflects the inclusion of a non-cash impairment charge required under U.S. GAAP of $86.9 million. Operating loss was $87.8 million compared to operating earnings of $19.1 million for the same period a year ago. Net loss attributable to company before specific items was $31.5 million compared to $37.8 million for the same period a year ago. Basic and diluted loss per share from continuing operations were $9.01 compared to earnings of $41.65 per share. Capital spending was $23.4 million for the year. The company production results for the full year of 2013. The company produced 1,382.6 tonnes compared to 1,388.6 tonnes for the same period a year ago. Capital spending for 2014 is expected to be similar to the previous year, in the range of $20 million. The company reported non-cash impairment charge of $86.9 million required under U.S. GAAP for the fourth quarter of 2014.

Similar Private Companies By Industry

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Recent Private Companies Transactions

Type
Date
Target
Merger/Acquisition
June 27, 2013
--
Merger/Acquisition
May 24, 2013
Catalyst Paper Corporation, Elk Falls Industrial Site
 

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