Resolute Forest Products Inc (RFP) 2017 Q3 法說會逐字稿

Good morning, ladies and gentlemen. Welcome to the Resolute Forest Products Third Quarter 2017 Earnings Conference Call. (Operator Instructions) Please note that this call is being recorded today, Thursday, November 2, 2017, at 9:00 a.m. Eastern Time.

早安，女士們，先生們。歡迎參加 Resolute Forest Products 2017 年第三季財報電話會議。（操作員說明）請注意，本次通話將於今天（2017 年 11 月 2 日星期四）上午 9:00 進行錄音。東部時間。

I would now like to turn the meeting over to Mr. Alain Bourdages, Vice President. Please go ahead, Mr. Bourdages.

我現在請副主席阿蘭·布爾達奇先生主持會議。請繼續，布爾達奇先生。

Thank you, and good morning. Welcome to Resolute's third quarter earnings call. Today we'll hear from Richard Garneau, President and Chief Executive Officer; and Jo-Ann Longworth, Senior Vice President and Chief Financial Officer.

謝謝你，早安。歡迎參加 Resolute 第三季財報電話會議。今天我們將聆聽總裁兼執行長理查德·加諾 (Richard Garneau) 的演講；以及資深副總裁兼財務長 Jo-Ann Longworth。

You can follow along with the slides for today's presentation by logging on to the webcast using the link in the presentations and webcast page under the Investor Relations section of our website, or you can also download the slides.

您可以使用我們網站投資者關係部分下演示和網絡廣播頁面中的連結登入網絡廣播，觀看今天演示的幻燈片，也可以下載幻燈片。

Today's presentation will include certain non-U. S. GAAP financial information. A reconciliation of those non-GAAP numbers to U.S. GAAP financial measures is included in our press release and in the appendix to the slides.

今天的演講將包括某些非美國的內容。S. GAAP 財務資訊。我們的新聞稿和投影片附錄中包含了這些非公認會計準則資料與美國公認會計準則財務指標的調整表。

We will also make forward-looking statements. Forward-looking information is based on our current assumptions, beliefs, and expectations, all of which involve a number of business risks and uncertainties and can change as conditions do. Please review the cautionary statements in our press release and on Slide #2 of today's presentation.

我們也將做出前瞻性陳述。前瞻性資訊是基於我們當前的假設、信念和期望，所有這些都涉及許多業務風險和不確定性，並且可能會隨著情況的變化而變化。請查看我們的新聞稿和今天簡報第 2 號投影片中的警告聲明。

Good morning, and thank you for joining us. So we generated adjusted EBITDA of $118 million for the quarter compared to $83 million in the second quarter. Year-to-date our EBITDA is now $262 million, $62 million higher than the same period last year. Our results were supported by a combination of stronger pricing, higher shipments in our wood product and market pulp segments, as well as general input cost improvements and savings derived from the closure of the high-cost machine in our specialty paper segment.

早安，感謝您加入我們。因此，本季調整後 EBITDA 為 1.18 億美元，而第二季為 8,300 萬美元。年初至今，我們的 EBITDA 為 2.62 億美元，比去年同期增加了 6,200 萬美元。我們的業績得益於更強勁的定價、木製品和商品紙漿領域出貨量的增加，以及特種紙領域高成本機器關閉帶來的整體投入成本改善和節省。

By segment we generated adjusted EBITDA of $73 million in the wood products, up by $21 million; $27 million in market pulp, an improvement of $3 million against the previous quarter; while negative $1 million from our tissue operation; $10 million in newsprint, unchanged from last quarter; then $18 million in specialty papers, up by $14 million.

按部門劃分，我們在木製品領域的調整後 EBITDA 為 7,300 萬美元，增加了 2,100 萬美元；商品紙漿 2,700 萬美元，較上一季增加 300 萬美元；而我們的組織業務卻負了 100 萬美元；新聞紙1000萬美元，與上季持平；然後是特種紙 1800 萬美元，增加了 1400 萬美元。

Markets for wood products remained favorable as forest fire in British Columbia affected supply, resulting in higher than expected pricing. Hurricane impacted our tissue operation negatively, as operation in Florida were stuck for approximately 10 days to allow employees and their families to safely prepare for the arrival of Hurricane Irma. Pulp market showed strength during the quarter with pricing continuing to rise and further widespread increase announcements across all major grades in September. In paper we saw the positive impacts of difficult capacity curtailment discussions and the general restructuring of our operation at Catawba. This led to reductions in our overall cost position which is illustrated on Slide 4 of this presentation.

由於不列顛哥倫比亞省的森林火災影響了供應，導致木製品市場仍然有利，導致價格高於預期。颶風對我們的組織業務產生了負面影響，佛羅裡達州的業務陷入了大約 10 天的停滯狀態，以便員工及其家人能夠安全地為颶風艾爾瑪的到來做好準備。本季紙漿市場表現強勁，價格持續上漲，9 月所有主要等級的紙漿價格進一步普遍上漲。在論文中，我們看到了困難的產能削減討論和卡托巴業務整體重組的正面影響。這導致我們整體成本的降低，如本簡報的投影片 4 所示。

Let's review our individual segments, starting with wood products. Average seasonally adjusted U.S. housing starts were essentially unchanged from the second quarter, and increase only slightly compared to the same period in 2016. However, on the positive side, more lumber-intensive single-family starts rose by 2.6% on average compared to Q2, which may result in higher wood consumption in the U.S.

讓我們回顧一下我們的各個細分市場，從木製品開始。經季節調整後的美國平均新屋開工率與第二季基本持平，與 2016 年同期相比僅略有成長。然而，從積極的一面來看，木材密集型單戶住宅開工率較第二季平均增加 2.6%，這可能導緻美國木材消耗量增加。

Even with slow growth in housing demand during the quarter and the temporary suspension of preliminary countervailing duties at the end of August, market prices continued to rise supported by uncertainties associated with the ongoing trade dispute, forest fire in British Columbia, and hurricanes in the southern U.S. This had a positive impact on our realized pricing, which rose by approximately 7% when compared to the second quarter reaching $413 per thousand board feet.

儘管本季住房需求成長緩慢，且8月底暫停徵收初步反補貼稅，但在持續的貿易爭端、不列顛哥倫比亞省森林火災和南部颶風等不確定因素的支撐下，市場價格繼續上漲。的實際定價產生了積極影響，與第二季度相比上漲了約7%，達到每千板英尺413 美元。

Shipments remain strong for the quarter, rising to 531 million board feet. Higher volume led to a reduction in our delivered cost of $8 per thousand board feet to $291 per thousand board feet. This combination of higher pricing, lower costs, and higher volume push EBITDA up to $73 million for the quarter, an increase of $21 million from Q2.

本季出貨量依然強勁，增至 5.31 億板英尺。產量的增加使我們的交付成本從每千板英尺 8 美元降低到每千板英尺 291 美元。更高的定價、更低的成本和更高的產量相結合，使本季的 EBITDA 達到 7,300 萬美元，比第二季增加了 2,100 萬美元。

World shipments of chemical pulp grew by 3.1% in the quarter, compared to the same period of 2016. Shipments to North America and China rose by 3.8% and 4% respectively, while Western Europe was essentially unchanged. Specifically for softwood kraft, shipment increased by 4.5% globally, with North America rising 4.8%, China 5.2%, and Western Europe 1.1%.

與 2016 年同期相比，本季全球化學漿出貨量成長了 3.1%。對北美和中國的出貨量分別成長了3.8%和4%，而西歐則基本維持不變。具體到軟木牛皮紙，全球出貨量成長了 4.5%，其中北美成長 4.8%，中國成長 5.2%，西歐成長 1.1%。

For all the wood grades, global shipments grew by 1.4%, mostly due to China, which recorded an increase of 2.4% during the quarter compared to Q3 of 2016. Shipments to North America rose by 1.9% over the same period, while Western Europe declined by less than 1%. Given this sustained uptrend in market demand as well as production disruption worldwide, our overall realized pricing for the segment rose again this quarter reaching $650 per metric ton, an increase of 3% from Q2.

對於所有木材等級，全球出貨量成長了 1.4%，主要歸功於中國，該季度與 2016 年第三季相比成長了 2.4%。同期對北美的出貨量成長了1.9%，而西歐的出貨量則下降了不到1%。鑑於市場需求的持續上升趨勢以及全球生產中斷，本季度我們該細分市場的整體實現定價再次上漲，達到每噸 650 美元，比第二季度增長 3%。

We had only one annual maintenance outage compared to 3 in Q2, which led to an additional 12,000 metric tons of shipments, and an increase of $14 million in market pulp sales for the third quarter. The delivered cost rose by $12 per metric ton, reaching $595 per metric ton. This was mostly the result of the relative strengthening of the Canadian dollar and a lower contribution from our cogeneration operation due to the annual outage of the St. Felicien in September.

與第二季的 3 次相比，我們僅發生了一次年度維護中斷，這導致第三季的出貨量增加了 12,000 噸，商品漿銷售額增加了 1,400 萬美元。交付成本每噸上漲 12 美元，達到每噸 595 美元。這主要是由於加元相對走強以及聖勞倫斯河每年停電導致熱電聯產業務的貢獻較低的結果。九月的費利西安。

In the third quarter, total tissue consumption in the United States increased 1.3% against the same period of last year. Away-from-home shipments increased 3% while at-home grew 1.3%. This quarter performance in tissue was adversely impacted by infrastructure damage as well as production disruption from the -- from Hurricane Irma which negatively negated improvements in profitability for the segment when compared to the previous quarter. The delivered cost rose by $160 per short ton when compared to Q2.

第三季度，美國生活用紙總消費量較去年同期成長1.3%。離家出貨量成長 3%，而國內出貨量成長 1.3%。本季生活用紙的業績受到基礎設施損壞以及颶風艾爾瑪造成的生產中斷的不利影響，與上一季相比，該部門的盈利能力的改善受到負面影響。與第二季相比，交付成本每短噸上漲 160 美元。

Nevertheless, we were able to maintain shipments when compared to the second quarter with sales of inventory compensating for lost production. Our grade mix also shifted slightly with gains in retail volume which helped maintain overall realized pricing when compared to the second quarter.

儘管如此，與第二季度相比，我們能夠維持出貨量，庫存銷售彌補了生產損失。隨著零售量的成長，我們的牌號組合也略有變化，這有助於維持與第二季相比的整體實現定價。

At Calhoun our sales ramp-up continues, but is challenged by long varying cycles. Our new tissue senior management team is taking action to improve our market access introducing changes to branding and leveraging our integrated pulp to offer competitive products in an environment of rising market pulp price.

在卡爾霍恩，我們的銷售額持續成長，但面臨較長的變化週期的挑戰。我們新的衛生紙高階管理團隊正在採取行動改善我們的市場准入，引入品牌變革，並利用我們的綜合紙漿在市場紙漿價格上漲的環境中提供有競爭力的產品。

North American demand for newsprint fell by 8.6% in the third quarter compared to the same period in 2016. Exports declined 3.5% over the same period as global demand went down 11.2%. Our shipments held up well in the third quarter falling by 2% or 9,000 metric tons mostly due to downtime at Baie-Comeau and Augusta. The relative strengthening of the Canadian dollars pushed our realized price up slightly.

第三季北美新聞紙需求較2016年同期下降8.6%。同期出口下降 3.5%，全球需求下降 11.2%。我們的出貨量在第三季保持良好，下降了 2% 或 9,000 噸，主要是由於拜科莫和奧古斯塔的停機。加幣的相對走強推動我們的實現價格小幅上漲。

On the other hand, the strength in the Canadian dollars negatively impacted our cost production, lower maintenance cost and a higher contribution from our cogeneration operations due to outages in the previous quarter neutralize the impact, leaving our overall delivered cost roughly unchanged from Q2.

另一方面，加幣走強對我們的生產成本產生了負面影響，維護成本降低以及上一季度停電導致熱電聯產業務的貢獻增加抵消了影響，使我們的總體交付成本與第二季度基本持平。

North American demand for uncoated mechanical papers were -- was down by 7.7% in the quarter compared to the same period last year. Markets for supercalendered paper led this decline dropping 13%. Market conditions in coated mechanical grades continued to be challenging, while North American demand fell 7.9% during the quarter compared to the same period last year. Production and imports fell by 12.7% and 4.3% respectively.

本季北美對未塗佈機械紙的需求與去年同期相比下降了 7.7%。超級砑光紙市場引領這一跌幅，下降了 13%。塗層機械牌號的市場狀況持續充滿挑戰，而本季北美需求與去年同期相比下降了 7.9%。產量和進口量分別下降12.7%和4.3%。

Despite continued declines in demand and the closure of a coated paper machine in Catawba at the end of second quarter, shipments of specialty papers fell by only 16,000 short tons in Q3. However, price increases and optimization of our sales mix positively impacted sales in coated grades where realized prices increased by $17 per short ton. Pricing gains across our specialty paper portfolio were $8 per short ton. The segment's delivered cost decreased by $34 per short ton. This was mostly driven by the elimination of $11 million in costs associated with the restructuring at Catawba.

儘管需求持續下降，且第二季末卡托巴的一台塗佈紙機已關閉，但第三季特種紙的出貨量僅下降了 16,000 短噸。然而，價格上漲和銷售組合優化對塗層等級的銷售產生了積極影響，實際價格每短噸上漲了 17 美元。我們的特種紙產品組合的定價收益為每短噸 8 美元。該部門的交付成本每短噸下降了 34 美元。這主要是由於消除了與卡托巴重組相關的 1,100 萬美元成本。

I will now let Jo-Ann discuss our financial performance before I conclude with our priorities and outlook.

現在，在我結束我們的優先事項和前景之前，我將讓喬安討論我們的財務表現。

Good morning, everyone. Today we reported net income of $31 million for the third quarter or $0.34 per share excluding special items. This compares to a net loss excluding special items of $3 million in the previous quarter and net income excluding special items of $15 million for the same period last year. Special items included closure cost, impairments and other related charges of $10 million and $11 million of inventory write down both associated primarily with the machine closures at Calhoun at the end of September. A foreign currency translation gain of $7 million and non-operating pension and OPEB credits of $4 million.

大家，早安。今天，我們報告第三季淨利潤為 3100 萬美元，即每股 0.34 美元（不包括特殊項目）。相較之下，上一季不計特殊項目的淨虧損為 300 萬美元，去年同期不計特殊項目的淨利為 1,500 萬美元。特殊項目包括關閉成本、減損和其他相關費用 1,000 萬美元以及 1,100 萬美元的庫存減記，這兩項費用主要與 9 月底卡爾霍恩的機器關閉有關。外幣換算收益為 700 萬美元，非營業退休金和 OPEB 信貸為 400 萬美元。

Total sales in the third quarter were $885 million, $27 million higher than the second quarter. Overall pricing positively impacted the results by $22 million primarily in wood products where prices rose by $27 per thousand board feet and market pulp where we made gains of $18 per metric ton. While tissue pricing was unchanged, realized prices in specialty paper and newsprint also rose by $8 per short ton and $2 per metric ton respectively.

第三季總銷售額為8.85億美元，比第二季增加2700萬美元。整體定價對業績產生了 2,200 萬美元的正面影響，主要是木製品的價格每千板英尺上漲了 27 美元，而商品紙漿的價格每噸上漲了 18 美元。雖然生活用紙價格保持不變，但特種紙和新聞紙的實際價格也分別上漲了每短噸 8 美元和每公噸 2 美元。

Shipments of wood products reached new highs in the third quarter rising to 531 million board feet. Benefiting from favorable market dynamics and only one annual outage during the quarter, pulp shipments also increased by 12,000 metric tons.

第三季木製品出貨量創下新高，達到 5.31 億板英尺。受益於有利的市場動態以及本季僅發生一次的年度停電，紙漿出貨量也增加了 12,000 噸。

While tissue shipments were impeded by disruptions owing to Hurricane Irma, they remain flat. Paper segment saw declines of 9,000 metric tons and 16,000 short tons for newsprint and specialty papers respectively.

雖然衛生紙運輸因颶風艾爾瑪造成的中斷而受阻，但仍保持穩定。造紙部門新聞紙和特種紙分別減少 9,000 噸和 16,000 短噸。

Excluding impact from foreign currency, volume and machine closure, our cost of goods sold fell by $19 million when compared to the second quarter. Major items included $4 million in chemical savings related to changes in product mix, a similar amount associated with better prices and usage of wood and recycled material. And a further $4 million from lower maintenance costs notably in our newsprint segment.

排除外匯、銷售和機器關閉的影響，我們的銷售成本比第二季下降了 1,900 萬美元。主要項目包括與產品結構變化相關的 400 萬美元化學品節省，與更好的價格以及木材和回收材料的使用相關的類似金額。另外，維護成本的降低也帶來了 400 萬美元的收益，尤其是在我們的新聞紙領域。

Market pulp all in delivered costs was up by $12 per metric ton largely due to the relative strengthening of the Canadian dollar and a lower contribution from cogeneration due to the timing of outages which were partially offset by lower purchase energy costs. However, increases in both volume and pricing were more than sufficient to offset these elements and EBITDA rose from $71 to $78 per metric ton.

市場紙漿的所有交付成本每噸上漲 12 美元，主要是由於加元相對走強，以及由於停電時間而導致熱電聯產的貢獻較低，但購買能源成本的下降部分抵消了熱電聯產的貢獻。然而，銷量和價格的成長足以抵消這些因素，EBITDA 從每噸 71 美元升至 78 美元。

With disruption to our tissue business impacting cost, EBITDA for the second -- for the segment was minus $1 million. In wood products, the delivered cost fell by $8 per thousand board feet due largely to higher volumes. With prices increasing $27 per thousand board feet and shipments rising by $22 million board feet, EBITDA increased by 34% to $137 per thousand board feet.

由於我們的衛生紙業務中斷影響了成本，該部門的第二個 EBITDA 為負 100 萬美元。在木製品方面，由於產量增加，交付成本每千板英尺下降了 8 美元。隨著價格每千板英尺上漲 27 美元，出貨量增加 2,200 萬美元板英尺，EBITDA 成長 34%，達到每千板英尺 137 美元。

Newsprint's delivered costs remain largely unchanged at $526 per metric ton as lower maintenance costs and higher contributions from cogeneration were almost entirely offset by the strengthening of the Canadian dollar. With pricing up and volumes only slightly lower, EBITDA per metric ton remained stable at $26.

新聞紙的交付成本基本上保持在每噸 526 美元不變，因為較低的維護成本和熱電聯產的較高貢獻幾乎完全被加元的走強所抵消。由於價格上漲且銷量僅略有下降，每噸 EBITDA 仍穩定在 26 美元。

In specialty paper, the delivered cost fell by $34 per short ton primarily driven by the elimination of cost resulting from the Catawba restructuring. Prices rose by $8 per short ton and EBITDA increased from $11 to $54 per short ton despite lower volumes.

在特殊紙張方面，交付成本每短噸下降了 34 美元，主要是由於卡托巴重組消除了成本。儘管產量減少，但價格上漲了每短噸 8 美元，EBITDA 從每短噸 11 美元增加到 54 美元。

We spent $20 million on capital expenditures in the quarter. $7 million was spent on the Calhoun tissue project. With CapEx totaling $136 million year-to-date we expect to finish the year at or below our 2017 target of $185 million.

本季我們的資本支出為 2000 萬美元。卡爾霍恩衛生紙計畫花費了 700 萬美元。今年迄今的資本支出總額為 1.36 億美元，我們預計今年結束時將達到或低於 2017 年 1.85 億美元的目標。

Despite expected higher net pension and OPEB contributions due to timing as well as the seasonal increase in working capital, which were $37 million and $28 million respectively, the company repaid an additional $7 million on its revolving credit facilities. We repaid a further $30 million since the end of the third quarter. Due mainly to additional letters of credit required in connection with trade disputes, our total liquidity declined by $14 million and stood at $400 million at the end of September.

儘管由於時間安排和營運資金季節性增加，預計退休金淨額和 OPEB 繳款額將分別增加 3,700 萬美元和 2,800 萬美元，但該公司仍額外償還了 700 萬美元的循環信貸額度。自第三季末以來，我們又償還了 3,000 萬美元。主要由於與貿易爭端相關的額外信用證，我們的流動資金總額減少了 1,400 萬美元，截至 9 月底為 4 億美元。

As mentioned last quarter, the company is recording lumber and supercalendered duty deposits in other asset of a consolidated balance sheet. Consequently EBITDA as reported for the wood products and specialty paper segment do not include any amounts related to duties.

正如上季度所提到的，該公司將木材和超級壓延稅存款記錄在合併資產負債表的其他資產中。因此，木製品和特種紙部門報告的 EBITDA 不包括任何與關稅相關的金額。

Total countervailing duties and antidumping duty deposit of $19 million were recorded on our balance sheet during the third quarter of which $5 million were related to supercalendered paper and $14 million to softwood lumber. The total cumulative deposits of $62 million are recorded in other assets on the balance sheet. We may define benefit pension and OPEB contributions totaling $39 million in the quarter. The net pension and OPEB liability on the balance sheet increased by $5 billion. This was the result of foreign exchange losses totaling $33 million and an $18 million charge in large part due to the revaluation of our U.S. plant following the closure of a paper machine at Catawba.

第三季我們的資產負債表上記錄的反補貼稅和反傾銷稅保證金總額為 1,900 萬美元，其中 500 萬美元與超級壓光紙相關，1,400 萬美元與軟木相關。累計存款總額為 6,200 萬美元，記錄在資產負債表的其他資產中。我們可能會定義本季福利退休金和 OPEB 繳款總額為 3,900 萬美元。資產負債表上的退休金淨額和OPEB負債增加了50億美元。這是由於總計 3,300 萬美元的外匯損失和 1,800 萬美元的費用造成的，這在很大程度上是由於卡托巴的一台造紙機關閉後我們美國工廠的重估造成的。

As you'll see on Slide 15, the important steps we have taken in the last year to optimize our pension contributions are producing results. Total actual contributions for the year -- for the quarter, excuse me, were $26 million lower than the same period in 2016. We also expect contributions for the fourth quarter to be lower by approximately $17 million compared to Q3.

正如您將在投影片 15 中看到的那樣，我們去年為優化退休金繳款所採取的重要步驟正在產生成果。對不起，本季的實際捐款總額比 2016 年同期減少了 2,600 萬美元。我們也預計第四季的捐款將比第三季減少約 1700 萬美元。

I will now turn it over to Richard for concluding remarks.

現在我將把它交給理查做總結發言。

Thank you, Jo-Ann. In an environment of rising home prices, we believe that our current issue of integration strengthens our competitive position in the marketplace. Operational improvement efforts are also clear in our quarterly results, particularly in the specialty paper segment where that we restructure the Catawba operations. Within capacity that was not profitable. The impact of additional capacity closures at Calhoun at the end of September is expected to produce incremental benefits starting in Q4.

謝謝你，喬安。在房價上漲的環境下，我們相信當前的整合問題增強了我們在市場上的競爭地位。我們的季度業績也清楚地表明了營運改善的努力，特別是在特種紙領域，我們重組了 Catawba 業務。在無法獲利的能力範圍內。卡爾霍恩 9 月底額外關閉產能的影響預計將從第四季開始產生增量效益。

In term of financial flexibility, we are going to meet our CapEx targets for 2017 and have repaid $48 million of borrowing under our credit facility since the first quarter despite making duty deposit of $35 million for the first 9 month of the year. As a result of favorable lumber market and a lower average preliminary duty rate on other Canadian producers, the cash contribution of our wood products group has strengthened through the year. Our beliefs in the importance and value of free trade is unchanged and we continue to defend that position. The preliminary duties effectively ignore the regulatory changes made in Quebec forestry system in 2013 making it market-based and also the 2005 naphtha panel ruling confirming the absence of subsidies in (inaudible) residual system.

在財務彈性方面，我們將實現 2017 年的資本支出目標，儘管今年前 9 個月繳納了 3,500 萬美元的稅金，但自第一季以來我們已償還了信貸安排下的 4,800 萬美元借款。由於有利的木材市場和其他加拿大生產商較低的平均初步稅率，我們木製品集團的現金貢獻全年有所加強。我們對自由貿易的重要性和價值的信念沒有改變，我們將繼續捍衛這一立場。初步關稅實際上忽略了 2013 年魁北克林業系統的監管變化，使其以市場為基礎，也忽略了 2005 年石腦油小組的裁決，該裁決確認（聽不清楚）剩餘系統中沒有補貼。

Our market outlook is broadly unchanged from last quarter. In pulp, market dynamics involved more favorably than we expected and we anticipate a further price realizations in the fourth quarter. We also believe that 2018 will be better than originally expected given limited capacity additions forecasted to come online after Q2. Our short-term perspective in tissue remained the same as before.

我們的市場前景與上季基本沒有變化。在紙漿方面，市場動態比我們預期的更為有利，我們預期第四季價格將進一步實現。我們也認為，鑑於第二季後預計新增產能有限，2018 年將優於最初預期。我們對衛生紙的短期看法與以前相同。

Our senior leadership team is deploying every effort to establish a solid foothold in the market and we will see result of those effort in 2018. In wood product, we expect fundamentals continued to strengthen and anticipate that even without the resolution of the softwood lumber trade dispute, the segment will continue to be a key contributor to our overall profitability take next year. A change in our outlook since last quarter is in our paper segment. Global capacity reduction so far in 2017 in both newsprint and specialty grades resulted in higher operating rates despite structural demand declines. Price increases have been announced in Q4 across our paper product offering which will positively impact our result.

我們的高階領導團隊正在盡一切努力在市場上站穩腳跟，我們將在 2018 年看到這些努力的成果。在木製品方面，我們預計基本面將繼續走強，並預計即使軟木貿易爭端沒有解決，該領域也將繼續成為我們明年整體獲利能力的關鍵貢獻者。自上季以來，我們的前景發生了變化，發生在造紙業務領域。2017 年迄今為止，儘管結構性需求下降，但新聞紙和特種紙的全球產能減少導致開工率上升。我們的紙製品產品已在第四季度宣布漲價，這將對我們的業績產生正面影響。

This concludes our formal presentation. Operator, we'll now open the call for questions.

我們的正式演講到此結束。接線員，我們現在開始提問。

(Operator Instructions) Your first question comes from the line of Hamir Patel of CIBC Capital Markets.

（操作員說明）您的第一個問題來自 CIBC 資本市場的 Hamir Patel。

Richard, there were reports I think maybe 2 weeks ago in Pulp and Paper Week suggesting that you're potentially exploring selling Catawba to a contained wood producer. Is that sale process still proceeding and any update on the study of potential conversion at Thorold with Stonehouse?

理查德，我想大約兩週前《紙漿與造紙周刊》上有報道稱您可能正在考慮將卡托巴出售給一家封閉的木材生產商。出售過程仍在進行中嗎？

Well, with Catawba first we're looking at all the options, so -- and there is opportunities as we all know that we have an excellent pulp mill, and a lot of capacities, so -- but there was no decision and there was -- at this point nothing has come up, we're still looking at optimizing the -- following our restructuring optimizing the coated machines and also increasing the pulp production. So I think that when you look at the market dynamic on pulp, we have been able to crank the production on the dryer, on the pulp dryer and we have also made some slight modification to better use the pulp mill capacity. Regarding Thorold, we're Still looking at different options here, but we haven't proceeded with what (inaudible) at this point, but still looking at other options to be able to maintain this site, and we have nothing to announce at this point, but within the year, a couple of months, over 3 months, we have -- doing trials on different opportunities now and will be able to report on it later around -- late at the end of the first quarter next year.

嗯，首先我們會考慮卡托巴的所有選擇，所以——我們都知道，我們有一個優秀的紙漿廠，而且產能很大，所以——但沒有做出決定，所以有機會- 目前還沒有任何進展，我們仍在考慮優化- 在我們重組後優化塗佈機並增加紙漿產量。因此，我認為，當您觀察紙漿的市場動態時，我們已經能夠在乾燥機上啟動生產，在紙漿乾燥機上，我們也進行了一些細微的修改，以更好地利用紙漿廠的產能。關於索羅爾德，我們仍在考慮不同的選擇，但目前我們還沒有繼續進行什麼（聽不清），但仍在考慮其他選項來維護這個網站，我們目前沒有什麼可宣布的點，但在一年內，幾個月，三個多月，我們現在正在對不同的機會進行試驗，並將能夠在明年第一季末晚些時候報告。

And just on the newsprint trade case, are you expecting any potential duties when they're announced to be retroactive 90 days like they were for the lumber case?

就新聞紙貿易案而言，當宣布關稅可追溯至 90 天時，您是否預計會像木材案一樣徵收任何潛在關稅？

Well, on newsprint, I think that the commerce has not proceeded with the verification, so we have completed the questionnaire and we are waiting for the next step. I don't know what is going to happen. I think that it's difficult with commerce because based on the discussion that we had on [FC], I'm just going to use this one, we knew that commerce make a decision that of -- often arbitrary and capricious, so I don't want to guess what is going to happen on paper at this point.

那麼新聞紙方面，我認為商務部還沒有進行核查，所以我們已經完成了問卷，正在等待下一步。我不知道會發生什麼事。我認為商業很難，因為根據我們在 [FC] 上的討論，我只想使用這個，我們知道商業做出的決定通常是任意且反复無常的，所以我不這樣做此時不想猜測紙上會發生什麼。

And just to (inaudible), on the tissue side obviously there's clearly a ramp-up curve as we are waiting for some of those contracts to come up for a bid, but what's your view on this steady state EBITDA potential of Calhoun once that machine has eventually fully ramped up and you sort of position the order book appropriately?

只是（聽不清楚），在紙巾方面，顯然有一條明顯的上升曲線，因為我們正在等待其中一些合約的出價，但您對卡爾霍恩一旦那台機器的穩態 EBITDA 潛力有何看法最終完全上升，您對訂單簿的定位是否適當？

Well, the -- I -- listen, I think this one before I make any commitment on what EBITDA is going to be, we are working very urgently with all of team, with -- everything is that now our tissue business and is making progress to work with potential customers and hopefully we're going to now start to see higher shipments, and when we have a better indication on how much volumes that we're going to be able to gain, we would be in a better position to give you indication of that the -- this machine is going to contribute, and as I said during the call so I think that with the pulp price that is going up, obviously this machine is going to be in the -- in a better position because this last step is coming through actually from the pulp mill, and as you are aware that we closed 2 machines, there was plenty of disposal and we expect that our cost also at Calhoun should also be lower and that will benefit our competitive efforts actions, so I think that I would like to await another quarter or 2 and see how this -- the shipments are going to evolve and how many bids we're going to lead, that we are going to be successful with them, but I'm still very hopeful that this is going to be a success long term.

嗯，我聽著，我認為在我對 EBITDA 做出任何承諾之前，我們正在與所有團隊進行非常緊急的合作，一切都是現在我們的衛生紙業務正在做的與潛在客戶合作取得進展，希望我們現在將開始看到更高的出貨量，當我們更好地了解我們將能夠獲得多少數量時，我們將能夠更好地向您表明，這台機器將做出貢獻，正如我在電話中所說，所以我認為隨著紙漿價格的上漲，顯然這台機器將處於更好的位置因為最後一步實際上是從紙漿廠進行的，正如您所知，我們關閉了兩台機器，有大量的處置，我們預計我們在卡爾霍恩的成本也應該更低，這將有利於我們的競爭努力行動，所以我想我想再等一兩個季度，看看出貨量將如何發展，我們將主導多少個投標，我們將在這些方面取得成功，但我'我仍然非常希望這將取得長期成功。

(Operator Instructions) Your next question comes from the line of Sean Steuart of TD.

（操作員說明）您的下一個問題來自 TD 的 Sean Steuart。

Few questions. In the waterfall slide showing the quarter-to-quarter progression EBITDA, the cost release bucket separate from the Catawba restructuring benefits showed about $15 million quarter-over-quarter improvement. Can you give us a bit of detail on the -- I guess the cost buckets that you saw the most relief on a sequential basis on?

幾個問題。在顯示 EBITDA 季度環比進展的瀑布幻燈片中，與 Catawba 重組收益分開的成本釋放桶顯示環比改善約 1500 萬美元。您能否向我們提供一些詳細資訊—我猜您認為按順序來看最有緩解的成本類別？

Yes. We had about $4 million from reductions in chemical cost largely because of mix. We had about the same amount due to lower maintenance and also the same about $4 million from reduced usage and prices for both wood as well as recycled paper during the quarter.

是的。我們透過混合減少了大約 400 萬美元的化學品成本。由於維護成本降低，我們獲得了大約相同的金額，並且由於本季度木材和再生紙的使用量和價格減少，我們獲得了約 400 萬美元的資金。

Your lumber price realizations improved a bit faster than we thought they would given what looked to be pretty flat markets for stud lumber this quarter, can you speak to your mix and maybe it was an order file timing issue, but some of the factors that contributed to get momentum on that front?

鑑於本季的螺柱木材市場看起來相當平坦，你們的木材價格實現提高的速度比我們想像的要快一些，你能談談你的組合嗎？因素在這方面獲得動力？

Well, Jo-Ann is looking for the mix of random and (technical difficulty).

好吧，喬安正在尋找隨機和（技術難度）的組合。

Hello?

你好？

Sorry. Okay, so the random went up faster than stud, and it's difficult to explain why it's not exactly following the same pattern. But we all know that stud has normally a lower value than random and demand was higher for random in this quarter. So -- but normally that's a track -- it's a track closer. So -- and I don't know exactly the reason, it's not a question of mix because we always have the same mix of 2/3 and 2/4, and we also have volume that is also coming from the volume that -- or the disposed but one area, but in term of quality is the same. So I think that that was just going to hold it and there is no real reason for the discrepancy between the two.

對不起。好吧，所以隨機數比螺柱上升得更快，而且很難解釋為什麼它不完全遵循相同的模式。但我們都知道，螺柱的價值通常低於隨機，且本季對隨機的需求較高。所以——但通常這是一條軌道——它是一條更接近的軌道。所以——我不知道確切的原因，這不是混合的問題，因為我們總是有相同的 2/3 和 2/4 混合，而且我們的音量也來自——或僅處置一個區域，但在質量上是相同的。所以我認為這只是為了維持現狀，兩者之間沒有任何差異的真正原因。

Last question from me, you referenced the continuing positive momentum in pulp markets into the fourth quarter. I think we have good transparency on what's happening for softwood and hardwood grades, but can you speak to price initiatives that are on the table for your recycled grades in the fourth quarter?

我的最後一個問題，您提到了第四季度紙漿市場持續的積極勢頭。我認為我們對軟木和硬木等級的情況有很好的透明度，但您能談談第四季度回收等級的價格舉措嗎？

Well, the recycled grade that's certainly more challenging, so we're not running our 2 mills at full capacity. We are taking also market downtime. And the -- I would not give you what the forecast is for the fourth quarter because I just don't know how the demand is going to be affected. I think that on what I could see and it's only speculation on my part, so the fact that the China has basically not renewed the permits to bring more recovered paper in China, that is probably a part of the explanation why we have better price on pulp. I think that it is what we see as a potential, we see probably some opportunity here, but to -- for the customers and maybe potential customers in China that wants to have recycled that we could take advantage of it because there is certainly the supply of that recovered paper in the U.S. that used to be shipped to China and is not.

嗯，回收等級肯定更具挑戰性，所以我們沒有滿載運行我們的 2 家工廠。我們也正在經歷市場停擺。我不會告訴你第四季的預測，因為我只是不知道需求將如何受到影響。我認為，就我所看到的情況而言，這只是我的猜測，因此中國基本上沒有更新許可證以將更多的廢紙帶入中國，這可能是為什麼我們的廢紙價格更高的部分原因紙漿。我認為這就是我們所看到的潛力，我們可能在這裡看到了一些機會，但是對於希望回收的中國客戶，也許還有潛在客戶，我們可以利用它，因為肯定有供應美國的廢紙曾經被運往中國，但現在沒有運往中國。

Your next question comes from the line of Paul Quinn of RBC Capital Markets.

您的下一個問題來自 RBC 資本市場的 Paul Quinn。

Just following up on Sean's question on pulp, pulp has logged $6 million to 2018 and beyond, obviously '17 was a lot better than most people expected. Is your expectation for '18 better than '17 and what do you see beyond '18?

就肖恩關於紙漿的問題進行跟進，到 2018 年及以後，紙漿已錄得 600 萬美元，顯然 17 年比大多數人的預期要好得多。您對 18 年的期望是否比 17 年更好？

Well, I think that you're -- I'm sure that you had (inaudible), that's one, but it doesn't -- but I think that China -- I think the China decision not to allow the same volume of recovered paper then to -- into their country because as you are aware there is about 20 million tons, 25 million tons of recovered paper, and when you look at the yield that is between 65 million tons and 70 million tons, it's a lot of material that is sent to landfills, so I think that if they decide that for environmental reason to continue to restrain I think that the market is going -- the fundamental could be really, really good and there is no new significant capacity as of next year. So I think it's probably not full of the thing that we may see other price increases next year if this situation continue to prevail.

嗯，我認為你——我確信你有（聽不清楚），這是一個，但事實並非如此——但我認為中國——我認為中國決定不允許同樣數量的廢紙然後進入他們的國家，因為如你所知，那裡有大約2000 萬噸、2500 萬噸廢紙，當你看到產量在6500 萬噸到7000 萬噸之間時，你會發現這是一個很大的數字。往垃圾掩埋場，所以我認為，如果他們出於環境原因決定繼續限制，我認為市場正在發展——基本面可能真的非常好，到明年就沒有新的重要產能。因此，我認為，如果這種情況繼續存在，明年我們可能會看到其他價格上漲，這可能不完全是這樣。

And then just on softwood lumber, I think I read something recently on Wilbur Ross was commenting that there'll be decision there within days or weeks, do you see any movement on that on the negotiation front?

然後就軟木而言，我想我最近在威爾伯·羅斯 (Wilbur Ross) 上讀到了一些評論，稱幾天或幾週內就會做出決定，您認為談判方面有任何進展嗎？

No, I don't think that there is much to be said on this one. I think that as you're probably aware the commerce and the coalition of -- they are demand that to limit the volume to -- we had 28% as for all Canada, but it's just not acceptable. So we cannot live with that and in any case we know that U.S. cannot produce more than 67%, 68% of the U.S. consumption. So we need Canada, and I think that it seems that there was also a refusal to consider the market that would certainly have an impact on the import from other countries that would leave the Canadian producers basically in a very difficult situation. So I think that -- I don't think that there is anything that based on what I know and I don't know much because I am not at the negotiation table, but there is a lot of rumors floating around, but I don't think that we're going to have a negotiated deal anytime soon, and I think that we're expecting in the next few days to have the final determination. So we'll see how it's going to come for Resolute and Eastern Canada.

不，我認為這一點沒有太多可說的。我認為，正如您可能知道的那樣，商業和聯盟要求將數量限制在整個加拿大的 28%，但這是不可接受的。所以我們不能接受這一點，無論如何我們知道美國的生產量不能超過美國消費量的 67%、68%。所以我們需要加拿大，我認為似乎也拒絕考慮市場，這肯定會對其他國家的進口產生影響，這將使加拿大生產商基本上處於非常困難的境地。所以我認為——我不認為有任何事情是基於我所知道的，而且我不知道太多，因為我不在談判桌上，但有很多謠言流傳，但我不知道我認為我們不會很快通過談判達成協議，我認為我們預計在接下來的幾天內做出最終決定。因此，我們將看看 Resolute 和加拿大東部的情況會如何。

And then just one clean-up, just for I think the first question you had asked was your potential to convert Catawba, and I think you are looking at options there, but I didn't understand the -- your answer to the Thorold question. Is that -- are you still proceeding with that conversion with -- you know where that --

然後只是一次清理，只是因為我認為你問的第一個問題是你轉換卡托巴的潛力，我認為你正在考慮那裡的選擇，但我不明白 - 你對索羅爾德問題的回答。那是——你還在繼續進行轉換嗎——你知道在哪裡——

No. No, we are not proceeding with that conversion. So we're looking at other options and we're going to have one of the options that we are looking at, so we're going to have file in November. So we are going to proceed the kind of product that we can get and -- but there is -- it's not going to be conversion of the machines as we previously discussed.

不。不，我們不會繼續進行該轉換。因此，我們正在考慮其他選項，並且我們將擁有我們正在考慮的選項之一，因此我們將在 11 月提交文件。因此，我們將繼續生產我們可以獲得的產品，但確實如此，它不會像我們之前討論的那樣對機器進行轉換。

There are no further questions at this time. I will turn the call back over to the presenters.

目前沒有其他問題。我會將電話轉回給演示者。

Thank you very much, everybody. This concludes the call. Have a good day.

非常感謝大家。通話就此結束。祝你有美好的一天。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連線。