Resolute Forest Products Inc. has released 2014 financial results and reported that the company’s Thunder Bay pellet plant, which began operations late last year, has already generated earnings before interest, taxes, depreciation, and amortization (EBITDA).
In its third quarter 2014 investor call last year, Resolute Forest Products announced construction was complete on the pellet plant, which is located Thunder Bay, Ontario. At that time, the plant was in ramp-up mode. In its fourth quarter 2014 investor call, Richard Garneau, president and CEO of Resolute Forest Products, indicated the plant, which has been operational since October, has generated EBITDA after only two months of operations. “We will continue to work to improve productivity to reach its production target,” he said.
The 45,000-ton-per-year facility supplies pellets to Ontario Power Generation’s Atikokan Generating Station under a 10-year supply contract. The station is the largest 100 percent biomass-fueled power plant in North America. The facility, which was previously fire by coal, officially began operating on biomass in September following a two-year conversion process.
Resolute Forest Products reported net income for the fourth quarter, excluding special items, of $36 million, or 38 cents per share, up $4 million, or 4 cents per share, from the same period of 2013. Sales were $1.1 billion for the quarter, down $95 million, or 8 percent, from the same quarter of the prior year. GAAP net loss was $109 million, or $1.15 per share, compared to a net loss of $3 million, or 3 cents per share, for the fourth quarter of 2013. The company’s adjusted EBITDA was $106 million for the quarter, down $4 million from the same period of 2013.
For the full year 2014, the company generated net income of $46 million, or 49 cents per share, excluding special items, down from 107 million, or $1.13 per share, in 2013. Sales were $4.3 billion for the year, down $203 million, or 5 percent, from the prior year. GAAP net loss was $277 million, or $2.93 per share, compared to a net loss of $639 million, or $6.75 per share, in 2013, as the 2013 results were significantly affected by a $572 million non-cash income tax charge. The company’s adjusted EBITDA was $366 million 2014, down $11 million from the previous year.