Ainsworth Lumber Co. jumped out of the red with a net income of C$1.8 million (US$1.8 million) during the fourth quarter, compared to the C$12.4 million (US$12.6 million) net loss the company took during fourth quarter 2009, the company announced on Friday.
The fourth quarter appeared to be a reflection of the fiscal year 2010 numbers, during which the Vancouver-based company posted a net income of C$9.4 million (US$9.6 million), once again swinging out of the red. The company reported a net loss of C$21.6 million (US$22 million) during 2009.
Net sales on the quarter fell to C$55 million (US$56.1 million) on the quarter, a C$11.1 million (US$11.3 million) drop compared to the year earlier period. For the year, net sales increased to C$329.5 million (US$335.9 million), a 15% increase over 2009.
The company also said average market prices for 7/16-inch oriented stand board (OSB) increased by 33% during the year in the North Central market to US$219 per million square feet. The Western Canadian annual market price also rose 45% during 2010 to US$213 per million square feet. The company's OSB shipments from continuing operations were 285,900 million square feet for 3/8-inch OSB for the fourth quarter and 1,456,900 million square feet for 3/8-inch OSB for the year.
"With the full support of our employees, we have taken steps over the past two years to reduce costs, to focus on our core oriented strand board producing assets, and to target growth in value-added products," said president and CEO Rick Huff. "During the year, Ainsworth made progress and advanced a number of important initiatives, including securing long term labor contracts with all of our unionized employees, completing critical maintenance and upgrades, growing our sales in key market segments, and strategically expanding our incremental capacity at an affordable cost."
The company posted earnings before interest, taxes, depreciation and amortization (EBITDA) loss of C$3.8 million (US$3.9 million) for the quaret. In a statement released by the company, maintenance and upgrades at all three of its mills, which required shutdowns of the locations, were cited as the cause of the EBITDA loss. The improvements were made to enhance efficiency at the mills, as well as allow the 100 Mile House mill to be able to process timber infected by the Pine Mountain Beetle epidemic.
EBITDA for the year was C$53.7 million (US$54.7 million), a huge jump from the C$5.2 million (US$5.3 million) in EBITDA the company announced for 2009.
Aside from the upgrades at its own mills, Ainsworth recently purchased the remaining 50% of Footner Forest Products Inc. and now completely owns the company. Ainsworth said they plan to operate the mill, which had its production curtailed in Dec. 2007, on a care and maintenance basis.