Resolute Forest Products CEO Steps Down

A dearth of truckers in Canada is hindering shipments from Resolute Forest Products’ sawmills to its paper mills, outgoing Chief Executive Officer Richard Garneau said Thursday on an earnings conference call. The Montreal-based company slowed down production in December after the shortage and harsh winter conditions led to a lack of woodchips at its mills in Quebec, according to Bloomberg.

The leadership change was announced as Resolute disappointed despite swinging to a profit of $13 million or 14 cents per diluted share. That compared with a loss of $45 million or 50 cents per share a year ago. Sales for the three months ended December 31 totalled $898 million, up from $889 million a year ago.

Excluding special items, the company said it earned $14 million or 15 cents per share for the quarter, compared with a loss, excluding special items of $7 million or eight cents per share in 4Q 2016.

Resolute FP

Yves Laflamme — currently Resolute’s senior vice-president of wood products, global procurement and information technology — has been appointed as a replacement effective Friday. Laflamme is a 37- year veteran at Resolute.

On the quarterly report release and CEO step-down announcement Thursday, Resolute Forest Products’ stock plunged as much as -33 per cent on TSX, the most since trading be- gan in 2010. The paper maker reported earn- ings per share in the 4Q that missed the lowest analyst estimate, said Bloomberg Thursday.

Lack of available transportation equipment, impeding delivery, was cited as a large reason behind the returns. The company is now using oversized trailers for its loads and has introduced special hiring and training programs to attract workers, said outgoing CEO Richard Garneau.

For the full year, Resolute reported a loss of $84 million or 93 cents per diluted share, com- pared with a loss of $81 million or 90 cents per diluted share in 2016. Sales totalled $3.51 billion, down from $3.55 billion.

Excluding special items, Resolute said it earned $12 million or 13 cents per share last year compared with a loss of $12 million or 13 cents per share in 2016.

Resolute’s freight costs rose in 2017 due to an increase in rates, shipping distances, and issues related to the truck-driver shortage, the company said in a statement. Canada will have a shortfall of 34,000 drivers by 2024 and that could rise to as many as 48,000 as aging drivers retire and the industry struggles to at- tract younger workers, according to a 2016 re- port from the Canadian Trucking Alliance, said CTV News Thursday.