Note: Financial references in US dollars unless otherwise
indicated.
Q1 2019 HIGHLIGHTS
- Adjusted EBITDA of $42
million
- Earnings of $0.01 per diluted
share; Adjusted loss of $0.02 per
diluted share
- European EBITDA increased 17% year-over-year to $21 million
- Repurchased $39 million of
shares, exhausting Normal Course Issuer Bid limit
- Declared quarterly variable dividend of C $0.40 per share for shareholders of record on
June 1, 2019
TORONTO, May 2, 2019 /CNW/ - Norbord Inc. (TSX and NYSE:
OSB) today reported Adjusted EBITDA of $42
million in the first quarter of 2019 compared to
$70 million in the fourth quarter of
2018 and $170 million in the first
quarter of 2018. The decrease versus both comparative periods was
primarily due to lower North American oriented strand board (OSB)
prices. North American operations generated Adjusted EBITDA of
$23 million compared to $50 million in the prior quarter and $156 million in the same quarter last year.
European operations delivered Adjusted EBITDA of $21 million compared to $24 million in the prior quarter and $18 million in the same quarter last
year.
"The pace of US housing construction began to decelerate in the
second half of last year and this trend carried over into the first
quarter," said Peter Wijnbergen, Norbord's President and CEO.
"Further, the seasonally slowest time of year was exacerbated by
unusually wet weather in many of our North American operating
regions. Combined, these factors led to very disappointing market
conditions and prompted us to take extensive downtime across our
North American mills. This negatively impacted our production
volumes and manufacturing costs."
"US housing demand has clearly pulled back in the last nine
months and the market has yet to recover in terms of volume. We
remain of the view that this is a pause rather than a directional
shift. US housing fundamentals remain supportive and we have
already seen some of the negative trends that caused the housing
pullback reverse. Mortgage rates have improved, home builders are
starting to offer more entry-level homes to help first-time buyers,
and home builder sentiment is improving. Although the pick-up in
demand that typically coincides with the spring building season has
been late in coming, housing demand is setting up for a stronger
second half."
"In Europe, our panel business
had another good quarter, delivering 17% more Adjusted EBITDA
year-over-year due to continued strong OSB demand in our key
markets and the ramp-up of our modernized and expanded Inverness, Scotland mill. The second-phase of
investment at Inverness is now
underway and will help us serve growing customer demand for several
years to come."
Norbord recorded an Adjusted loss of $2
million or $0.02 per share
(basic and diluted) in the first quarter of 2019 compared to
Adjusted earnings of $26 million or
$0.30 per share (basic and diluted)
in the fourth quarter of 2018 and $96
million or $1.10 per diluted
share ($1.11 per basic share) in the
first quarter of 2018. Adjusted earnings exclude non-recurring or
other items and use a normalized income tax rate:
$
millions
|
Q1
2019
|
Q4 2018
|
Q1 2018
|
Earnings
(loss)
|
1
|
(28)
|
95
|
Adjusted
for:
|
|
|
|
Impairment of
assets
|
-
|
80
|
-
|
Loss on disposal of
assets
|
-
|
2
|
-
|
Stock-based
compensation and related costs
|
1
|
-
|
1
|
Reported income tax
(recovery) expense
|
(5)
|
(26)
|
36
|
Adjusted pre-tax
(loss) earnings
|
(3)
|
28
|
132
|
Income tax recovery
(expense) at statutory rate
|
1
|
(2)
|
(36)
|
Adjusted (loss)
earnings
|
(2)
|
26
|
96
|
Market Conditions
In North America, US housing
demand was negatively impacted by higher mortgage rates and new
home prices as well as record rainfall across the US which
constrained homebuilding activity. Year-to-date US housing starts
were down 10% versus the same period in 2018, with single-family
starts, which use approximately three times more OSB than
multifamily, decreasing by 5%. The seasonally adjusted annualized
rate was 1.14 million in March, which is 14% lower than the pace at
this time last year, while the pace of housing permits (the more
forward-looking indicator) was 1.27 million. The consensus forecast
from US housing economists is approximately 1.26 million starts for
2019, in line with last year.
North American benchmark OSB prices in all regions weakened due
to the pullback in demand from homebuilding. As a result, average
benchmark prices were lower than both the prior quarter and the
same quarter last year. The table below summarizes average
benchmark OSB prices ($ per Msf, 7/16-inch basis) by region for the
relevant quarters:
North American
region
|
% of
Norbord's
operating capacity
|
Q1
2019
|
Q4 2018
|
Q1 2018
|
North
Central
|
15%
|
211
|
243
|
370
|
South East
|
36%
|
197
|
203
|
331
|
Western
Canada
|
29%
|
160
|
184
|
359
|
In Europe, panel markets
remained strong, driven by continued OSB demand growth in Norbord's
core geographies. In local currency terms, average panel prices
were down a modest 3% from the prior quarter due to seasonality and
sales mix, but up 5% versus the same quarter last year.
Performance
North American OSB shipments increased 3% year-over-year due to
six additional fiscal days in the current quarter, and were 2%
lower quarter-over-quarter due to the timing of annual maintenance
and other downtime. Norbord's specialty sales volume (including
industrial and export markets) represents approximately 25% of the
Company's North American OSB sales volume.
Excluding the curtailed Chambord,
Quebec mill, Norbord's operating North American OSB mills
produced at 85% of stated capacity, compared to 89% in the prior
quarter and 94% in the same quarter last year. Capacity utilization
decreased versus both comparative periods as a result of the
year-end restatement of annual production capacities at a number of
mills.
Norbord's North American OSB cash production costs per unit
(before mill profit share) decreased 1% versus the prior quarter
but increased 3% compared to the same quarter last year due to the
timing of annual maintenance and other downtime. In addition, lower
resin prices had some impact quarter-over-quarter while
year-over-year, higher fibre and energy prices were a factor.
In Europe, Norbord's shipments
were 15% higher than the prior quarter and 13% higher than the same
quarter last year. The European mills produced at 89% of stated
capacity in the quarter, unchanged from the prior quarter and
compared to 86% in the same quarter last year. Capacity utilization
was unchanged quarter-over-quarter as the new finishing line at the
Inverness, Scotland OSB mill was
being commissioned during the first quarter of 2019. Capacity
utilization increased year-over-year due to the continued ramp-up
of the reinvested Inverness mill
following its start-up in the fourth quarter of 2017.
The Company did not generate any MIP gains in the quarter as
improved productivity and lower raw material usage at the restarted
Huguley, Alabama and expanded
Inverness, Scotland mills were
offset by the timing of annual maintenance shuts and other
downtime, as well as the operating impact of severe winter weather
this year. MIP is measured relative to the prior year at constant
prices and exchange rates.
Capital investments (including intangible assets) were
$30 million in the first quarter
compared to $60 million in the prior
quarter and $50 million in the same
quarter last year. The decreases versus both comparative quarters
are primarily attributable to the timing of executing on various
capital projects, including the Inverness project.
Included in capital investments is $2
million of the $46 million
(£35 million) budget for the second phase investment to
further expand capacity at the Inverness, Scotland mill by 225 MMsf (3/8-inch
basis) (200,000 cubic metres) through the addition of a second
wood room and dryer. This project is expected to take approximately
two years to complete and is consistent with the Company's strategy
of growing its European OSB capacity to serve rapid consumption
growth in its key markets.
At the Chambord, Quebec mill
rebuild project, $9 million of the
$71 million budget was invested in
the quarter ($36 million
project-to-date). Norbord believes North American OSB demand will
continue to grow. In order to support this anticipated growth and
enhance the competitive position of the Company's overall
manufacturing operations, Norbord is rebuilding and preparing
the Chambord, Quebec mill for an
eventual restart. The Company has not yet made a restart decision,
however, and will only do so when it is sufficiently clear that
customers require more product. This project involves replacing the
dryers and investing in the wood-handling and finishing areas to
streamline the mill's manufacturing process and reduce costs, as
well as upgrades to process and personal safety systems, electrical
systems and environmental equipment that will bring the mill up to
current standards after a decade of curtailment.
Norbord's 2019 capital expenditure budget is approximately
$150 million for projects focused on
reducing manufacturing costs across the mills, as well as a portion
of the Chambord, Quebec mill
rebuild and Inverness, Scotland
phase 2 projects. It also includes investments to support the
Company's strategy to increase the production of specialty products
for industrial applications and exports.
Operating working capital was $183
million at quarter-end compared to $218 million at the end of the same quarter last
year and $88 million at year-end
2018. The year-over-year decrease is primarily due to lower North
American OSB prices as well as timing of payments and new lease
liabilities recognized upon transition to the new lease accounting
standard. The quarter-over-quarter increase is primarily due to the
annual seasonal build of log inventory in the northern mills in
North America, the payment of
annual incentive payouts, as well as the timing of payments.
Working capital continues to be managed at minimal levels across
the Company.
At quarter-end, Norbord had unutilized available liquidity of
$239 million, consisting of
$2 million in cash and $237 million in revolving bank lines. The
Company's tangible net worth was $1,107
million and net debt to total capitalization on a book basis
was 34%, both well within bank covenants.
Dividend
The Board of Directors declared a quarterly variable dividend of
C $0.40 per common share, payable on
June 21, 2019 to shareholders of
record on June 1, 2019, unchanged
from the prior quarter's level. The Board reduced the variable
dividend level in the prior quarter in response to weaker than
expected North American benchmark OSB prices as well as the
$141 million of capital allocated to
common share repurchases from November
2018 through January 2019.
Norbord believes the recent pullback in US housing demand is
temporary and that the fundamentals underlying OSB demand remain
supportive. Any dividends reinvested on June
21, 2019 under the Company's Dividend Reinvestment Plan will
be used by the transfer agent to purchase common shares on the open
market.
Norbord's dividends are declared in Canadian dollars. Registered
and beneficial shareholders may opt to receive their dividends in
either Canadian dollars or the US dollar equivalent. Unless they
request the US dollar equivalent, shareholders will receive
dividends in Canadian dollars. The US dollar equivalent of the
dividend will be based on the Bloomberg FX Fixings Service (BFIX)
noon exchange rate on the record date or, if the record date falls
on a weekend or holiday, on the BFIX noon exchange rate of the
preceding business day.
Registered shareholders wishing to receive the US dollar
dividend equivalent should contact Norbord's transfer agent, AST
Trust Company (Canada), by phone
at 1-800-387-0825 or by email at inquiries@canstockta.com.
Beneficial shareholders (i.e., those holding their Norbord shares
with their brokerage) should contact the broker with whom their
shares are held.
Norbord's variable dividend policy targets the payment to
shareholders of a portion of free cash flow based upon the
Company's financial position, results of operations, cash flow,
capital requirements and restrictions under the Company's revolving
bank lines, as well as the market outlook for the Company's
principal products and broader market and economic conditions,
among other factors. The Board retains the discretion to amend the
Company's dividend policy in any manner and at any time as it may
deem necessary or appropriate in the future. For these reasons, as
well as others, the Board in its sole discretion can decide to
increase, maintain, decrease, suspend or discontinue the payment of
cash dividends in the future.
Normal Course Issuer Bid
In October 2018, Norbord renewed
its normal course issuer bid (NCIB) in accordance with TSX rules.
Under the bid, Norbord has purchased 5,191,965 of its common shares
at a cost of $141 million,
representing 10% of the Company's public float of 51,919,654 as of
October 22, 2018, pursuant to TSX
rules and has exhausted the bid limit.
Norbord believed that the market price of its common shares was
attractive as they were trading significantly below replacement
cost and management's view of intrinsic value, and that the
purchase of these common shares was an appropriate use of Norbord's
funds in light of potential benefits to remaining shareholders.
Additional Information
Norbord's Q1 2019 letter to shareholders, news release,
management's discussion and analysis, consolidated unaudited
interim financial statements and notes to the financial statements
have been filed on SEDAR (www.sedar.com), EDGAR (www.sec.gov) and
are available in the investor section of the Company's website at
www.norbord.com. Shareholders may receive a hard copy of Norbord's
audited annual financial statements free of charge upon request.
The Company has also made available on its website presentation
materials containing certain historical and forward-looking
information relating to Norbord, including materials that contain
additional information about the Company's financial results.
Shareholders are encouraged to read this material.
Conference Call
Norbord will hold a conference call for analysts and
institutional investors on Thursday, May 2,
2019 at 2:00 p.m. ET. The call
will be broadcast live over the internet via www.norbord.com and
www.newswire.ca. An accompanying presentation will be available in
the "Investors/Conference Call" section of the Norbord website
prior to the start of the call. A replay number will be available
approximately one hour after completion of the call and will be
accessible until June 1, 2019 by
dialing 1-888-203-1112 or 647-436-0148 (passcode 5310685 and pin
2804). Audio playback and a written transcript will be available on
the Norbord website.
Norbord Profile
Norbord Inc. is a leading global manufacturer of wood-based
panels and the world's largest producer of oriented strand board
(OSB). In addition to OSB, Norbord manufactures particleboard,
medium density fibreboard and related value-added products. Norbord
has assets of approximately $1.9
billion and employs approximately 2,700 people at 17 plant
locations in the United States,
Canada and Europe. Norbord is a publicly traded company
listed on the Toronto Stock Exchange and New York Stock Exchange
under the symbol "OSB".
This news release contains forward-looking statements, as
defined by applicable securities legislation, including statements
related to our strategy, projects, plans, future financial or
operating performance and other statements that express
management's expectations or estimates of future performance.
Often, but not always, forward-looking statements can be identified
by the use of words such as "set up," "on track," "expect,"
"estimate," "forecast," "target," "outlook," "schedule,"
"represent," "continue," "intend," "should," "would," "could,"
"will," "can," "might," "may," and other expressions which are
predictions of or indicate future events, trends or prospects and
which do not relate to historical matters identify forward-looking
statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Norbord to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements.
Although Norbord believes it has a reasonable basis for
making these forward-looking statements, readers are cautioned not
to place undue reliance on such forward-looking information. By its
nature, forward-looking information involves numerous assumptions,
inherent risks and uncertainties, both general and specific, which
contribute to the possibility that the predictions, forecasts and
other forward-looking statements will not occur. Factors that could
cause actual results to differ materially from those contemplated
or implied by forward-looking statements include: assumptions in
connection with the economic and financial conditions in the US,
Europe, Canada and globally; risks inherent to product
concentration and cyclicality; effects of competition and product
pricing pressures; risks inherent to customer dependence; effects
of variations in the price and availability of manufacturing
inputs, including continued access to fibre resources at
competitive prices; availability of rail services and port
facilities; various events that could disrupt operations, including
natural or catastrophic events and ongoing relations with
employees; impact of changes to, or non-compliance with,
environmental regulations; impact of any product liability claims
in excess of insurance coverage; risks inherent to a capital
intensive industry; impact of future outcomes of tax exposures;
potential future changes in tax laws; effects of currency exposures
and exchange rate fluctuations; future operating costs,
availability of financing, impact of future cross-border trade
rulings or agreements; ability to implement new or upgraded
information technology infrastructure; impact of information
technology service disruptions or failures; and other risks and
factors described from time to time in filings with Canadian
securities regulatory authorities.
Except as required by applicable law, Norbord does not
undertake to update any forward-looking statements, whether written
or oral, that may be made from time to time by, or on behalf of,
the Company, whether as a result of new information, future events
or otherwise, or to publicly update or revise the above list of
factors affecting this information. See the "Caution Regarding
Forward-Looking Information" statement in the January 31, 2019 Annual Information Form and the
cautionary statement contained in the "Forward-Looking Statements"
section of the 2018 Management's Discussion and
Analysis dated January 31, 2019 and
Q1 2019 Management's Discussion and Analysis dated May 1, 2019.
Norbord defines Adjusted EBITDA as earnings determined in
accordance with International Financial Reporting Standards (IFRS)
before finance costs, interest income, income taxes, depreciation,
amortization and non-recurring or other items; Adjusted earnings
(loss) as earnings determined in accordance with IFRS before
non-recurring or other items and using a normalized income tax
rate; and Adjusted earnings (loss) per share is Adjusted earnings
(loss) divided by the weighted average number of common shares
outstanding (on a basic or diluted basis, as specified). Adjusted
EBITDA, Adjusted earnings (loss), and Adjusted earnings (loss) per
share are non-IFRS financial measures, do not have any standardized
meaning prescribed by IFRS and are therefore unlikely to be
comparable to similar measures presented by other companies. See
"Non-IFRS Financial Measures" in Norbord's 2018 Management's
Discussion and Analysis dated January 31,
2019 and Q1 2019 Management's Discussion and Analysis dated
May 1, 2019 for a quantitative
reconciliation of Adjusted EBITDA and Adjusted earnings to earnings
(the most directly comparable IFRS measure).
May 2, 2019
To Our Shareholders:
The difficult housing market conditions that began in the latter
part of last year continued into the first quarter of 2019. The
seasonally slowest time of year was further exacerbated this
quarter by persistent poor building weather in many of our North
American operating regions, which broke numerous cold, snowfall and
rainfall records. As a result, we took extensive downtime across
our North American mills. While it was appropriate to adjust our
production to demand, this translated into lower volumes and higher
manufacturing costs, which negatively impacted our first quarter
financial results.
US housing demand has clearly pulled back in the last nine
months and the market has yet to recover in terms of volume.
However, we remain of the view that this is a pause rather than a
directional shift. The fundamentals underlying the housing market –
a key driver of OSB demand – remain supportive and conditions are
slowly improving, both seasonally and due to improving
affordability. Mortgage rates are down from their recent highs, new
home prices have moderated and builders are offering record levels
of incentives for buyers. Home builders are forecasting to build
3-5% more new houses this year and some are starting to increase
their offerings of moderately priced, entry-level homes to entice
first-time buyers. The meaningful wage growth we're seeing will
also support increasing housing demand as the millennial cohort can
now start to form households of their own.
The uptick in demand that usually coincides with the spring
building season has been delayed by the prolonged poor weather and
has yet to translate into a stronger OSB market. Although the
current tight labour market makes it unlikely that builders will be
able to recover the lost ground from the slow start to the year, US
housing experts forecast the pace of construction activity will
accelerate with seasonally adjusted permits still tracking near 1.3
million in 2019.
In Europe, our panel business
had another solid performance, with 13% higher sales volumes
year-over-year due to continued strong OSB demand. The outlook in
Europe has remained more positive
and our European business is poised for another good year. With the
investment to further expand our Inverness, Scotland mill now underway, we will
be in position to meet growing demand for several years to
come.
Despite the disappointing results, the benefit of our focus on
more stable margin specialty products was evident during the past
two quarters when we saw significantly higher North American OSB
price realizations relative to the weak benchmark prices. We have a
strong balance sheet with comfortable liquidity. Our mills are
positioned to support housing market growth, but in the meantime,
we continue to prioritize diversifying our product mix and
expanding our European business. Finally, we remain focused on
shareholder value, buying back almost $40
million of our shares during the quarter which exhausted our
Normal Course Issuer Bid limit.
We look forward to reporting on our progress next quarter and
thank our shareholders for their continuing support.
Peter Wijnbergen
President & CEO
This letter includes forward-looking statements, as defined
by applicable securities legislation, including statements related
to our strategy, projects, plans, future financial or operating
performance, market outlook, and other statements that express
management's expectations or estimates of future performance.
Often, but not always, forward-looking statements can be identified
by the use of words such as "expect," "suggest," "support,"
"believe," "should," "potential," "likely," "continue," "forecast,"
"plan," "indicate," "consider," "future," or variations of such
words and phrases or statements that certain actions "may,"
"could," "must," "would," "might," or "will" be undertaken, occur
or be achieved. Forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of Norbord to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. See the cautionary language in the Forward-Looking
Statements section of the 2018 Management's Discussion and Analysis
dated January 31, 2019 and Q1 2019
Management's Discussion and Analysis dated May 1, 2019.
Norbord defines Adjusted EBITDA as earnings determined in
accordance with International Financial Reporting Standards (IFRS)
before finance costs, interest costs, income taxes, depreciation,
amortization and non-recurring or other items; Adjusted earnings
(loss) as earnings determined in accordance with IFRS before
non-recurring or other items and using a normalized income tax
rate; and Adjusted earnings (loss) per share as Adjusted earnings
(loss) divided by the weighted average number of common shares
outstanding (on a basic or diluted basis, as specified). Adjusted
EBITDA, Adjusted earnings (loss), and Adjusted earnings (loss) per
share are non-IFRS financial measures, do not have any standardized
meaning prescribed by IFRS and are therefore unlikely to be
comparable to similar measures presented by other companies. See
the Non-IFRS Financial Measures section in Norbord's Q1 2019
Management's Discussion and Analysis dated May 1, 2019 for a quantitative reconciliation of
Adjusted EBITDA and Adjusted earnings to earnings (the most
directly comparable IFRS measure).
Interim Consolidated Balance Sheets
|
|
|
|
(Unaudited)
(US $
millions)
|
Apr 6,
2019
|
|
Dec 31,
2018
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
2
|
|
$
|
128
|
Accounts
receivable
|
175
|
|
149
|
Taxes
receivable
|
43
|
|
—
|
Inventory
|
257
|
|
220
|
Prepaids
|
10
|
|
12
|
|
487
|
|
509
|
Non-current
assets
|
|
|
|
Property, plant and
equipment
|
1,425
|
|
1,402
|
Intangible
assets
|
19
|
|
20
|
Deferred income tax
assets
|
6
|
|
6
|
Other
assets
|
5
|
|
5
|
|
1,455
|
|
1,433
|
|
$
|
1,942
|
|
$
|
1,942
|
Liabilities and
shareholders' equity
|
|
|
|
Current
liabilities
|
|
|
|
Accounts payable and
accrued liabilities
|
$
|
259
|
|
$
|
293
|
Accrued liability
under ASPP
|
—
|
|
42
|
Taxes
payable
|
11
|
|
28
|
|
270
|
|
363
|
Non-current
liabilities
|
|
|
|
Long-term
debt
|
550
|
|
550
|
Other long-term
debt
|
80
|
|
—
|
Other
liabilities
|
46
|
|
34
|
Deferred income tax
liabilities
|
193
|
|
172
|
|
869
|
|
756
|
Shareholders'
equity
|
803
|
|
823
|
|
$
|
1,942
|
|
$
|
1,942
|
Interim Consolidated Statements of Earnings
(Unaudited)
Periods ended Apr 6
and Mar 31 (US $ millions, except per share information)
|
Q1
2019
|
|
Q1 2018
|
Sales
|
$
|
476
|
|
$
|
576
|
Cost of
sales
|
(432)
|
|
(402)
|
General and
administrative expenses
|
(3)
|
|
(5)
|
Depreciation and
amortization
|
(35)
|
|
(30)
|
Operating
income
|
6
|
|
139
|
Non-operating
expense:
|
|
|
|
Finance
costs
|
(11)
|
|
(8)
|
Interest
income
|
1
|
|
—
|
(Loss) earnings
before income tax
|
(4)
|
|
131
|
Income tax recovery
(expense)
|
5
|
|
(36)
|
Earnings
|
$
|
1
|
|
$
|
95
|
Earnings per common
share
|
|
|
|
Basic
|
$
|
0.01
|
|
$
|
1.10
|
Diluted
|
0.01
|
|
1.09
|
Interim Consolidated Statements of
Comprehensive Income
|
|
|
|
(Unaudited)
Periods ended Apr 6
and Mar 31 (US $ millions)
|
Q1
2019
|
|
Q1 2018
|
Earnings
|
$
|
1
|
|
$
|
95
|
Other comprehensive
income (loss), net of tax
|
|
|
|
Items that will not
be reclassified to earnings:
|
|
|
|
Actuarial loss on
post-employment obligation
|
(1)
|
|
—
|
Items that may be
reclassified subsequently to earnings:
|
|
|
|
Foreign currency
translation gain on foreign operations
|
6
|
|
11
|
Other comprehensive
income, net of tax
|
5
|
|
11
|
Comprehensive
income
|
$
|
6
|
|
$
|
106
|
Interim Consolidated Statements of Changes in
Shareholders' Equity
|
|
|
|
(Unaudited)
Periods ended Apr 6
and Mar 31 (US $ millions)
|
Q1
2019
|
|
Q1 2018
|
Share
capital
|
|
|
|
Balance, beginning of
period
|
$
|
1,280
|
|
$
|
1,350
|
Issue of common
shares upon exercise of options and DRIP
|
—
|
|
3
|
Reverse accrual for
common shares to be repurchased and cancelled under ASPP
|
24
|
|
—
|
Common shares
repurchased and cancelled
|
(24)
|
|
—
|
Balance, end of
period
|
$
|
1,280
|
|
$
|
1,353
|
Merger
reserve
|
$
|
(96)
|
|
$
|
(96)
|
Contributed
surplus
|
$
|
4
|
|
$
|
8
|
Retained
deficit
|
|
|
|
Balance, beginning of
period
|
$
|
(168)
|
|
$
|
(67)
|
Earnings
|
1
|
|
95
|
Common share
dividends
|
(25)
|
|
(41)
|
Reverse accrual for
common shares to be repurchased and cancelled under ASPP
|
18
|
|
—
|
Common shares
repurchased and cancelled
|
(19)
|
|
—
|
Balance, end of
period(i)
|
$
|
(193)
|
|
$
|
(13)
|
Accumulated other
comprehensive loss
|
|
|
|
Balance, beginning of
period
|
$
|
(197)
|
|
$
|
(176)
|
Other comprehensive
income
|
5
|
|
11
|
Balance, end of
period
|
$
|
(192)
|
|
$
|
(165)
|
Shareholders'
equity
|
$
|
803
|
|
$
|
1,087
|
(i) Retained deficit
comprised of:
|
|
|
Deficit arising on
cashless exercise of warrants in 2013
|
$
|
(263)
|
$
|
(263)
|
All other retained
earnings
|
70
|
250
|
|
$
|
(193)
|
$
|
(13)
|
Interim Consolidated Statements of Cash Flows
(Unaudited)
Periods ended Apr 6
and Mar 31 (US $ millions)
|
|
Q1
2019
|
|
Q1 2018
|
CASH PROVIDED BY
(USED FOR):
|
|
|
|
|
Operating
activities
|
|
|
|
|
Earnings
|
|
$
|
1
|
|
$
|
95
|
Items not affecting
cash:
|
|
|
|
|
Depreciation and
amortization
|
|
35
|
|
30
|
Deferred income
tax
|
|
21
|
|
3
|
Other
items
|
|
18
|
|
7
|
|
|
75
|
|
135
|
Net change in
non-cash operating working capital balances
|
|
(111)
|
|
(93)
|
Net change in taxes
receivable and taxes payable
|
|
(61)
|
|
(38)
|
|
|
(97)
|
|
4
|
Investing
activities
|
|
|
|
|
Investment in
property, plant and equipment
|
|
(40)
|
|
(56)
|
Financing
activities
|
|
|
|
|
Common share
dividends paid
|
|
(25)
|
|
(41)
|
Issue of common
shares
|
|
—
|
|
2
|
Repurchase of common
shares
|
|
(43)
|
|
—
|
Repayment of lease
obligations
|
|
(3)
|
|
—
|
Accounts receivable
securitization drawings
|
|
80
|
|
—
|
|
|
9
|
|
(39)
|
Foreign exchange
revaluation on cash and cash equivalents held
|
|
2
|
|
3
|
Cash and cash
equivalents
|
|
|
|
|
Decrease during
period
|
|
(126)
|
|
(88)
|
Balance, beginning of
period
|
|
128
|
|
241
|
Balance, end of
period
|
|
$
|
2
|
|
$
|
153
|
View original
content:http://www.prnewswire.com/news-releases/norbord-reports-first-quarter-2019-results-declares-quarterly-dividend-300842390.html
SOURCE Norbord Inc.