Bowater Plans Impairment Charge

It plans to file its 10-Q today.
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Paper company

Bowater

(BOW)

said Tuesday it will book a non-cash charge of $200 million and a corresponding increase in its third-quarter loss, when it files third quarter Form 10-Q with the regulators.

The impairment evaluation for the Thunder Bay, Ontario facility indicated impairment and resulted in a non-cash charge of $200 million.

On Oct. 26, the company reported a net loss of $16.1 million, or 28 cents a share for its third quarter.

In 2003, Bowater idled newsprint production on paper machine No. 3 at its Thunder Bay facility. Based on the continued decline of North American consumption of newsprint, the company now says it has no plans to restart the machine. Accordingly, the company recorded a non-cash impairment charge of $18.9 million to write down the value of the machine in the third quarter.

"We are working aggressively to address cost competitiveness at our Thunder Bay site," the Greenville, S.C.-based company said. "In addition to cost reductions, we continue to seek investment alternatives to improve our product mix."

Bowater wil file its third quarter Form 10-Q Tuesday.

The company's shares were up 7 cents at $21.11 Tuesday.

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