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Strong lumber markets allow Resolute to pay special dividend, spend and cut debt

Lumber is shown in Cochrane, Alta., Thursday, May 20, 2021.Resolute Forest Products Inc. says strong lumber markets is allowing it to pay a special $1 per share dividend, add US$50 million more in capital investments to support it growth and repay US$180 million in debt. THE CANADIAN PRESS/Jeff McIntosh
June 10, 2021 - 3:32 PM

MONTREAL - Resolute Forest Products Inc. says strong lumber markets are allowing it to pay a special dividend, spend US$50 million on its sawmills to support growth and repay US$180 million in debt.

The Montreal-based pulp, paper and lumber producer says the $1-per-share dividend will be paid July 7 for shareholders at the close of business on June 28.

The additional capital spending includes $22 million to modernize equipment at its sawmill in Senneterre, Que., $13 million to increase capacity at the sawmill in Thunder Bay-Fort William First Nation, and $15 million at a sawmill in Arkansas and another in Florida.

The U.S. investments are in addition to spending associated with the restart of its sawmill in El Dorado, Ark.

All projects are expected to be completed by the end of the third quarter of 2022.

The repayment of debt in the second quarter leaves the company with just $300 million owing in 2026 and liquidity of about $850 million.

"The cash generated with our lumber platform in these strong lumber markets provides the opportunity to share benefits directly with shareholders," stated CEO Remi Lalonde.

The forestry sector has benefited from record lumber prices.

This report by The Canadian Press was first published June 10, 2021.

Companies in this story: (TSX:RFP)

News from © The Canadian Press, 2021
The Canadian Press

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