Change in fortunes
The latest Global Forest and Paper Industry Net Earnings Summary from PwC reveals that Canadian companies in the east and west are headed in opposite directions.
The report, prepared from 2012 second quarter financial statements issued by the companies, shows that the 2012 second quarter net earnings reports for the Canadian forest and paper companies show a distinct quarter to quarter change in fortunes between the Western and Eastern based companies. The lumber and solid wood segment of the industry is experiencing slow but steady improvements, based primarily on the gradually improving U.S. housing market. Northern Bleached Softwood Pulp (NSBK) prices continued to decline from the record highs reached in Q2 2011.
Western Canadian based companies posted net earnings of $30.1 million compared with net losses of $ 39.5 million in the first quarter of 2012 and net earnings of $6.8 million in the second quarter of 2011.
Eastern Canadian based companies posted net losses of $58.3 million compared to net earnings of $31.2 million for the first quarter of 2012 and net earnings of 185.2 million in the second quarter of 2011.
In the U.S. 10 of the largest US-based forest and paper companies reported net earnings of US $1.1 billion for the second quarter of 2012, up from US $905.4 million in the first quarter of 2012 and US $899.9 million in the second quarter of 2011.
In Europe, 10 of the largest European-based forest and paper companies reported overall earnings of €482.6 million for the second quarter of 2012, up from earnings € 477.7 million in the first quarter of 2012, but down from earnings of € 696.1 million in the second quarter of 2011.
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