SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 1 0 - Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ______________
Commission File No. 0-795
BADGER PAPER MILLS, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 39-0143840
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 West Front Street
Peshtigo, Wisconsin 54157
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (715) 582-4551
Indicate by checkmark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such report(s), and (2) has been
subject to such filing requirements for the past 90 days.
[X] Yes. [_] No.
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the last practicable date: As of June 30, 1996,
1,945,130.
Indicate total number of pages contained in document filed: 11.
<PAGE>
BADGER PAPER MILLS, INC.
INDEX
Pages
FINANCIAL INFORMATION
Consolidated Interim Statements of
Operations and Retained Earnings -
Quarter and Six Months Ended
June 30, 1996 and 1995 3
Consolidated Balance Sheets - June 30, 1996 and
December 31, 1995 4
Consolidated Statements of Cash Flows - Six Months
Ended June 30, 1996 and 1995 5
Notes to Financial Statements 6-8
MANAGEMENT DISCUSSION AND ANALYSIS 8-9
OTHER INFORMATION 10
SIGNATURES 11
<PAGE>
BADGER PAPER MILLS, INC. AND SUBSIDIARY
CONSOLIDATED INTERIM STATEMENTS OF
OPERATIONS AND RETAINED EARNINGS
(UNAUDITED)
(dollars in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
1996 1995 1996 1995
Net Sales $20,778 $24,412 $39,232 $46,526
Cost of Sales 18,434 21,511 36,733 42,436
------- ------- ------- -------
Gross Margin 2,344 2,901 2,499 4,090
Selling and
Administrative Expenses 1,037 1,040 1,966 1,917
Pulp Mill Closure Costs 7,430 - 7,430 -
------- ------- ------- -------
Operating Income (Loss) (6,123) 1,861 (6,897) 2,173
Other Income, Net - 195 30 624
Gain on Sale of
Timberlands 4,620 - 4,620 -
Interest Expense (267) (353) (526) (728)
------- ------- ------- -------
Income (Loss) Before
Income Taxes (1,770) 1,703 (2,773) 2,069
Income Tax
Expense (Benefit) (602) 579 (943) 704
------- ------- ------- -------
Net Income (Loss) (1,168) 1,124 (1,830) 1,365
------- ------- ------- -------
Retained Earnings,
Beginning of Period 19,869 18,323 20,635 18,082
Cash Dividends (97) - (195) -
Unrealized Gain (Loss)
on Securities
Held for Sale 6 - - -
------- ------- ------- -------
Retained Earnings,
End of Period $18,610 $19,447 $18,610 $19,447
======= ======= ======= =======
Net Earning (Loss)
Per Share ($0.60) $0.57 ($0.94) $0.70
Dividends Per Share $0.05 - $0.10 -
Average Shares
Outstanding 1,945,130 1,957,330 1,944,330 1,957,187
See Notes to Financial Statements.
<PAGE>
BADGER PAPER MILLS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(dollars in thousands)
June 30, 1996 December 31, 1995
ASSETS:
Current Assets:
Cash & Cash Equivalents $3,307 $ 835
Marketable Securities 1,378 3,138
Accounts Receivable - Net 7,960 6,955
Deferred Income Taxes 1,059 1,059
Inventories 8,054 7,314
Refundable Income Taxes 1,286 173
Other Current Assets 251 560
------ ------
Total Current Assets 23,295 20,034
Property, Plant, Equipment &
Timberlands 77,150 76,496
Less Allowance for Depreciation
& Depletion (53,877) (46,156)
------- -------
Total Property, Plant, Equipment
& Timberlands 23,273 30,340
Other Assets 2,150 2,170
Restricted Funds from
Industrial Revenue Bonds - 34
------- -------
TOTAL ASSETS $48,718 $52,578
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities:
Current Portion of Long-Term Debt 115 115
Accounts Payable 5,581 5,823
Accrued Liabilities 4,807 3,637
------- -------
Total Current Liabilities 10,503 9,575
Deferred Income Taxes 2,604 2,604
Long Term Debt 14,212 17,236
Other Liabilities 1,951 1,720
------- -------
Total Liabilities 29,270 31,135
STOCKHOLDERS' EQUITY:
Common stock, no par value:
4,000,000 shares authorized
2,160,000 shares issued 2,700 2,700
Additional paid-in capital 178 168
Retained Earnings 18,610 20,633
Less treasury shares at cost:
214,870 - 6/30/96; 217,670 - 12/31/95 (2,040) (2,058)
------- -------
Total Stockholders' Equity 19,448 21,443
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $48,718 $52,578
======= =======
See Notes to Financial Statements
<PAGE>
BADGER PAPER MILLS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(dollars in thousands) Six Months Ended
June 30, June 30,
1996 1995
Cash Flows from Operating Activities:
Net (Loss) Income ($1,830) $1,365
Adjustments to Reconcile to Net Cash
Provided By (Used In) Operating
Activities:
Depreciation 1,570 1,643
Net Proceeds from Sales (Purchases)
of Marketable Securities 2,064 (30)
Unrealized Gain on
Marketable Securities (304) (330)
Gain on Sale of Timberlands (4,620) -
Increase in Accounts Receivables, Net (1,005) (1,747)
(Increase) Decrease in Inventories (740) 367
Decrease in Accounts Payable
and Accrued Liabilities 928 869
(Increase) Decrease Other (551) 173
------- -------
Net Cash (Used in) Provided by
Operating Activities (4,488) 2,310
------- -------
Cash Flows From Investing Activities:
Retirements from (Additions to)
Property, Plant and Equipment, Net 5,337 (1,177)
Proceeds from Sale of Timberlands 4,780 -
Decrease in Restricted Funds from
Industrial Revenue Bonds 34 1,589
------- --------
Net Cash Provided by
Investing Activities 10,151 412
------- --------
Cash Flows from Financing Activities:
Payments on Long-Term Debt (3,024) (3,822)
Sale of Treasury Stock 28 -
Dividends Paid (195) -
------- -------
Net Cash Used in Financing Activities (3,191) (3,822)
------- -------
Net Increase (Decrease) in Cash
and Cash Equivalents 2,472 (1,100)
Cash and Cash Equivalents:
Beginning of Period 835 1,375
------- -------
End of Period $3,307 $ 275
======= =======
See Notes to Financial Statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
A. BASIS OF PRESENTATION
The unaudited financial statements have been prepared by Badger Paper
Mills, Inc. (the "Company") pursuant to the rules and regulations of the
Securities and Exchange Commission ("SEC") and, in the opinion of the
Company, included all adjustments necessary for a fair statement of
results for each period shown. These adjustments were of a normal
recurring nature. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to
such SEC rules and regulations. The Company believes that the disclosures
made are adequate to make the information presented not misleading. It is
suggested that these financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's latest
annual report.
B. INCOME TAXES
The provision for income tax expense or benefit has been computed by
applying an estimated annual effective tax rate. This rate was a 34%
benefit for the quarter and six months ended June 30, 1996, resulting from
the Company's operating losses during such periods. For the quarter and
six months ended June 30, 1995, the Company provided for a 34% expense.
C. EARNINGS PER SHARE
Earnings per share of common stock are based on weighted average
number of shares of common stock outstanding.
D. INVENTORIES
The major classes of inventories are as follows (in thousands):
June 30, December 31,
1996 1995
Raw materials $4,599 $3,483
Work in process and finished stock 3,455 3,831
------ ------
$8,054 $7,314
====== ======
<PAGE>
E. DEBT
The Company's revolving credit facility provides for borrowings up to
$13 million. The credit facility was amended in August, 1996, to extend
its expiration to April 30, 1999, and to provide for financial covenants
which are less restrictive than provided in the prior agreement. An
annual commitment fee of 3/8% is payable quarterly for unused amounts
under the credit facility. Interest on borrowings is at the LIBOR rate
plus 1.75% (totaling 7.1875% at June 30, 1996). Borrowings are
collateralized by inventory, accounts receivable, marketable securities
and certain property, plant and equipment. Approximately $5,000,000 was
borrowed under the revolving credit facility as of June 30, 1996.
Interest on the Company's outstanding IDRBs is payable monthly at
floating rates determined by remarketing agents (3.45% at June 30, 1996)
and may be converted to fixed rates at certain dates in the future, at the
Company's option, as specified in the agreements. Approximately
$7,600,000 principle amount of IDRBs was outstanding as of June 30, 1996.
The IDRBs are collateralized by bank letters of credit expiring in
1999. The Company pays annual fees at 1% of the amount available under the
letters of credit. As amended in August, 1996, the letters of credit
require, among other items, the Company to maintain minimum tangible net
worth of $17,300,000 through June 29, 1997 ($18,500,000 from June 30, 1997
through December 30, 1997; $20,000,000 from December 31, 1997 through June
29, 1998; $22,000,000 from June 30, 1998 through December 30, 1998; and,
$24,500,000 December 31, 1998 and thereafter) and a current ratio of 1.9
to 1.0 or greater. Additionally, dividends and treasury stock purchases
are limited to 33% of the Company's cumulative net income from July 1,
1996.
At June 30, 1996, approximately $1,700,000 principle amount was
outstanding under an Urban Development Action Grant. The grant is
repayable in monthly installments of $15,437, including interest at an
effective rate of approximately 6.5%, through maturity in April, 2000, at
which time a final payment of $1,499,490 is due. This grant is
collateralized by certain machinery and equipment.
F. CONTINGENCIES
The Company operates in an industry which is subject to laws and
regulations at both federal and state levels relating to the protection of
the environment. The Company undergoes continued environmental testing
<PAGE>
and analysis, and the precise cost of compliance with environmental
requirements has not been determined.
In addition, from time to time, the Company is subject to various
claims, the ultimate outcomes of which management cannot predict.
Management believes that the outcomes will not have a material adverse
effect on the Company's consolidated financial position or results of
operations.
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Results of Operations
Sales for the second quarter, 1996 totaled $20,778,000 compared to
$24,412,000 for the second quarter, 1995 or a 14.9% decrease. Shipments
increased by 5.6% and average selling price decreased by 22.4% during this
time frame. Paper prices continued the downward trend which started in
the fourth quarter, 1995.
Sales for the six-month period ending June 30, 1996, were $39,232,000
compared to $46,526,000 for the same period a year ago. The decreased
revenue for the first six months of 1996 is reflective of an approximate
5% decrease in shipments and a 13% decrease in average selling price.
Cost of sales decreased 14% and 13% respectively for the second quarter
and six months of 1996, compared to the same periods a year earlier. The
decreased volume of shipments plus the decreased costs of purchased fiber
were the primary factors affecting cost of sales.
Selling and administrative expenses have remained relatively constant for
the second quarter and first half of 1996 as compared to the second
quarter and first half of 1995, $1,037,000 and $1,966,000 for 1996 and
$1,040,000 and $1,917,000 for 1995.
The Company recorded a second quarter, 1996 charge in the amount of
$7,430,000 resulting from the closure of the Company's pulp mill. The
charge includes the write-off of pulp mill fixed assets and inventories,
costs associated with early retirement or severance of certain workers,
and a provision for ongoing maintenance and security costs. The charge
for the discontinued pulp operations was partially offset by a second
quarter gain in the amount of $4,620,000 from the sale of timberlands
located in Northern Wisconsin and the Upper Peninsula of Michigan that
<PAGE>
were no longer compatible with the Company's fiber requirements. Proceeds
from the sale of the timberlands were used to retire debt. Excluding the
charge related to the discontinued pulp operations and the gain related to
the sale of the timberlands, the Company's second quarter, 1996 net income
was $686,000, or $.35 per share.
Liquidity and capital resources
Capital expenditures during the second quarter and six months, 1996
amounted to $574,000 and $999,000, as compared to $835,000 and $1,177,000
during the same periods in 1995. Capital expenditures were maintained at
levels to sustain manufacturing operations.
In the second quarter of 1996, the Company started the construction of a
$7.5 million stock preparation facility that is expected to be completed
late in the fourth quarter of 1996. The completion of this project will
allow for improved formulation and processing of wet end stock fibers. It
will also allow the Company to expand its specialty manufacturing
capabilities by the segregation of the Company's two paper machines white
water and stock recovery systems.
The Company operates in an industry which is subject to laws and
regulations at both federal and state levels relating to the protection of
the environment. The Company undergoes continued environmental testing
and analysis, and the precise cost of compliance with environmental
regulations has not been determined for the Company's operations.
As of June 30, 1996, the Company's capital resources for funding ongoing
operations and capital expenditures includes $4,685,000 of cash and
marketable securities, and a $13,000,000 revolving credit facility, of
which $5,000,000 is currently used. The Company believes it has adequate
capital resources to meet its near-term capital and operating needs.
Cash used in operating activities totaled $4,488,000 for the first six
months of 1996, compared to cash provided by operating activities for the
first half of 1995 of $2,310,000. Net cash provided by investing
activities was $10,151,000 for the first six months of 1996 compared to
$412,000 for the same period in 1995. The main items affecting cash were
the $4,620,000 gain on sale of the major portion of the Company's
timberlands and retirement of $5,337,000 of assets associated with the
pulp mill.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
(4) Sixth Amendment and Waiver dated August 9, 1996 to the
Credit Agreement dated June 30, 1993, between Badger Paper
Mills, Inc., Plas-Techs, Inc., and Harris Trust & Savings
Bank.
(27) Financial data schedules
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BADGER PAPER MILLS, INC.
(Registrant)
DATE: August 13, 1996 By /s/ Claude L. Van Hefty
Claude L. Van Hefty
President (Chief
Executive Officer)
DATE: August 13, 1996 By /s/ Miles L. Kresl, Jr.
Miles L. Kresl, Jr.
Vice President/Administration,
Corporate Secretary, &
Treasurer (Principal Financial
Officer)
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
(4) Sixth Amendment and Waiver dated August 9, 1996 to the
Credit Agreement dated June 30, 1993, between Badger Paper
Mills, Inc., Plas-Techs, Inc., and Harris Trust & Savings
Bank.
(27) Financial Data Schedule
SIXTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois
Gentlemen:
The undersigned, BADGER PAPER MILLS, INC., a Wisconsin corporation
("Badger"), and PLASTECHS, INC., a Wisconsin corporation ("PlasTechs")
(collectively, Badger and PlasTechs are hereinafter sometimes referred to
as "Borrowers"), refers to the Credit Agreement dated as of June 30, 1993,
as amended from time to time (the "Agreement") and currently in effect
between the Borrowers and you (the "Bank"). All capitalized terms used
herein without definition shall have the same meanings as they have in the
Agreement.
The Borrowers hereby apply to the Bank for certain modifications to
the Agreement and the Borrowers' borrowing arrangements with the Bank, and
for the waiver of certain covenants of the Agreement.
1. AMENDMENT.
Upon your acceptance hereof in the space provided for that purpose
below, the Agreement shall be and hereby is amended as follows:
(a) Section 7.7 of the Agreement is hereby amended in its entirety
to read as follows:
Section 7.7. Consolidated Tangible Net Worth. Badger will, as
of the last day of each fiscal month ending during each of the
periods specified below maintain Consolidated Tangible Net Worth
at not less than:
CONSOLIDATED
TANGIBLE NET
WORTH SHALL
FROM AND TO AND NOT BE LESS
INCLUDING INCLUDING THAN
July 1, 1996 June 29, 1997 $17,300,000
June 30, 1997 December 30, 1997 18,500,000
December 31, 1997 June 29, 1998 20,000,000
June 30, 1998 December 30, 1998 22,000,000
December 31, 1998 Thereafter 24,500,000
(b) Section 7.13 of the Agreement is hereby amended in its entirety
to read as follows:
Section 7.13. Capital Expenditures. Badger will not, nor will
it permit any Subsidiary to, expend or become obligated for
Capital Expenditures in an aggregate amount in excess of the
following:
Fiscal Year 1996 . . . . . . . . . . . $11,000,000
Fiscal Year 1997 . . . . . . . . . . . 8,000,000
Fiscal Year 1998 . . . . . . . . . . . 6,000,000
Fiscal Year 1999 . . . . . . . . . . . 4,000,000
(c) Section 7.15 of the Agreement is hereby amended in its entirety
to read as follows:
Section 7.15. Dividends and Certain Other Restricted Payments.
Badger will not, without the prior written consent of the
Lenders, declare or pay any dividends on or make any other
distributions in respect of any class of its capital stock
(other than dividends payable solely in its capital stock) and
no Borrower will directly or indirectly or through any
Subsidiary purchase, redeem or otherwise acquire or retire any
of its capital stock (all such payments and distributions are
collectively referred to as "Restricted Payments"); provided,
however, Badger may declare and make Restricted Payments only
after July 1, 1996 so long as (i) no Default or Event of Default
exists prior to or would result after giving effect to any such
Restricted Payments; and (ii) after giving effect to any such
Restricted Payments made during the period (taken as a single
accounting period) commencing July 1, 1996 and ending on the
last day of the most recent fiscal month for which financial
statements have been delivered shall not exceed 33% of the
Consolidated Net Income for such period; notwithstanding, Badger
may make a Restricted Payment up to $150,000.
(d) Section 10 of the Agreement is hereby amended as follows:
The definition of "Termination Date" appearing in Section 10 of
the Agreement is hereby amended by deleting the date "April 30,
1998" appearing therein and inserting in its place the date
"April 30, 1999".
2. WAIVER.
Badger has indicated that as of June 30, 1996 it was not in
compliance with the terms of the Agreement as follows and upon
satisfaction of the conditions precedent set forth in Section 3 hereof:
(a) As of such date, Badger's Tangible Net Worth was
$19,452,722. Section 7.7 of the Agreement requires Badger maintain a
Consolidated Net Worth of not less than $20,000,000. The Bank hereby
waives non-compliance by the Borrowers with Section 7.7 of the
Agreement for the period ending June 30, 1996 through the effective
date of this Amendment.
(b) As of such date, Badger exceeded the Restricted Payment by
$622,671. The Bank hereby waives non-compliance by the Borrowers
with Section 7.15 of the Agreement for the period ending June 30,
1996 through the effective date of this Amendment.
(c) The waiver contained in Sections 2(a) and 2(b) of this
Amendment is limited to matters set forth in those Sections, and the
Borrowers agree that they remain obligated to comply with the terms
of the Agreement, including Sections 7.7 and 7.15 of the Agreement,
and that the Bank shall not be obligated in the future to waive any
provision of the Agreement.
3. CONDITIONS PRECEDENT.
The effectiveness of this Sixth Amendment is subject to the
satisfaction of all of the following conditions precedent:
(a) The Borrowers and the Bank shall have executed this Sixth
Amendment.
(b) The Bank shall have received copies executed or certified
(as may be appropriate) of all legal documents or proceedings taken
in connection with the execution and delivery hereof and the other
instruments and documents contemplated hereby.
(c) All legal matters incident to the execution and delivery
hereof and of the instruments and documents contemplated hereby shall
be satisfactory to the Bank and its counsel.
4. REPRESENTATIONS.
In order to induce the Bank to execute and deliver this Sixth
Amendment, the Borrowers hereby represent to the Bank that as of the date
hereof and as of the time that this Sixth Amendment becomes effective,
each of the representations and warranties set forth in Section 5 of the
Agreement are and shall be and remain true and correct (except that the
representations contained in Section 5 shall be deemed to refer to the
most recent financial statements of the Borrowers delivered to the Bank)
and the Borrowers are in full compliance with all of the terms and
conditions of the Agreement and no Default as defined in the Agreement as
amended hereby nor any Event of Default as so defined, shall have occurred
and be continuing or shall arise after giving effect to this Sixth
Amendment.
5. MISCELLANEOUS.
(a) Collateral Security Unimpaired. The Borrowers hereby agree that
notwithstanding the execution and delivery hereof, the Collateral
Documents shall be and remain in full force and effect and that any rights
and remedies of the Bank thereunder, obligations of the Borrowers
thereunder and any liens or security interests created or provided for
thereunder shall be and remain in full force and effect and shall not be
affected, impaired or discharged hereby. Nothing herein contained shall
in any manner affect or impair the priority of the liens and security
interest created and provided for by the Collateral Documents as to the
indebtedness which would be secured thereby prior to giving effect hereto.
(b) Effect of Amendment. Except as specifically amended and
modified hereby, the Agreement shall stand and remain unchanged and in
full force and effect in accordance with its original terms. Reference to
this specific Amendment need not be made in any note, instrument or other
document making reference to the Agreement, any reference to the Agreement
in any of such to be deemed to be a reference to the Agreement as amended
hereby.
(c) Costs and Expenses. The Borrowers agree to pay on demand all
out-of-pocket costs and expenses incurred by the Bank in connection with
the negotiation, preparation, execution and delivery of this Sixth
Amendment and the documents and transactions contemplated hereby,
including the fees and expenses of counsel to the Bank with respect to the
foregoing.
(d) Counterparts; Governing Law. This Sixth Amendment may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which when so executed shall be an original
but all of which to constitute one and the same agreement. This Agreement
shall be governed by the internal laws of the State of Illinois.
Dated as of August 9, 1996.
BADGER PAPER MILLS, INC.
By: _________________________________
Its: ___________________________
PLASTECHS, INC.
By: _________________________________
Its: ___________________________
Accepted and agreed to at Chicago, Illinois, as of the date and year
last above written.
HARRIS TRUST AND SAVINGS BANK
By: _________________________________
Its: Vice President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF BADGER PAPER MILLS, INC. AS OF AND
FOR THE QUARTERS ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1996 JAN-01-1996
<PERIOD-END> JUN-30-1996 JUN-30-1996
<CASH> 3,307 3,307
<SECURITIES> 1,378 1,378
<RECEIVABLES> 7,960 7,960
<ALLOWANCES> 0 0
<INVENTORY> 8,054 8,054
<CURRENT-ASSETS> 23,295 23,295
<PP&E> 77,150 77,150
<DEPRECIATION> 53,877 53,877
<TOTAL-ASSETS> 48,718 48,718
<CURRENT-LIABILITIES> 10,503 10,503
<BONDS> 14,212 14,212
0 0
0 0
<COMMON> 2,700 2,700
<OTHER-SE> 179 179
<TOTAL-LIABILITY-AND-EQUITY> 48,718 48,718
<SALES> 20,778 39,232
<TOTAL-REVENUES> 20,778 39,232
<CGS> 18,434 36,733
<TOTAL-COSTS> 19,471 38,699
<OTHER-EXPENSES> 7,430<F1> 7,430<F1>
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 267 526
<INCOME-PRETAX> (1,770) (2,773)
<INCOME-TAX> (602) (943)
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (1,168) (1,830)
<EPS-PRIMARY> (.60) (.94)
<EPS-DILUTED> 0 0
<FN>
<F1>Pulp Mill Closure Charge
</FN>
</TABLE>
