Cascades has announced record sales of C$1,179m in its second quarter results, up 4% year-on-year.
This is compared to C$1,098m in Q1 2018 and C$1,130m in the second quarter of 2017 and was driven by an 11% increase in the containerboard division, reflecting higher sales prices, the acquisition of Ontario converting facilities at the end of 2017, and higher volumes during the period.
Adjusted operating income for the quarter of C$76m compared with C$50m in the first quarter of 2018 (+52%) and C$51m in the second quarter of 2017 (+49%).
Sales in the tissue segment increased marginally compared to prior year levels as the benefit of higher volumes was offset by a less favourable product mix and the Canadian dollar – US dollar exchange rate.
In the company’s tissue segment, adjusted operating income before depreciation (OIBD) for the quarter was C$7m, down from C$13m in the first quarter of 2018 and C$35m the same time a year earlier.
Mario Plourde, president and chief executive, said: “We are pleased with our consolidated second quarter financial and operating performance.
“Results from our tissue segment were down, reflecting the competitive marketplace and higher virgin pulp and white recycled fibre costs.
“This was in line with our updated outlook of stronger sales and shipment levels during the period.
“Transportation costs and availability also presented challenges for our North American operations.”
He added that the company expects sequentially flat results from the tissue segment “as benefits from anticipated volume growth continue to be muted by higher raw material pricing and more competitive market dynamics”.
“Finally, we anticipate that elevated transportation costs will continue to impact results for our North American operations.
“We continue to analyse and implement strategies to optimize our logistic strategies in light of this new higher pricing reality.
“From a broader and more strategic standpoint, we will continue to optimise our business platform, and increase the depth of productivity and efficiency benefits.
“We are similarly focused on the successful execution of our planned 2018 investment programme, ramping up operations at the new containerboard converting facility in NJ, and accelerating market penetration of our converted tissue products in Oregon.”