_TERRACE STANDARD. The ,erace Standard, Wednesday, February 16, 1994 - A? _BusIness REVIEW Repap observes financial light at end of the tunnel | REPAP HAS improved its finan- cial picture, and that of subsidiary Skecna Cellulose, by selling slock and renegotiating long term debt. The stock sale raised (Cana- dian) $150 million while a (U.S.) $400 million package for Repap Wisconsin reduces interest on debt payments to 9.5 per cent. Principal payments won’t have to be made on the latter debt for cight years. — Repap also worked out a deal - with lenders to reduce principal payments on Skeena Cellulose debt for five years, That’s to help buffer a $360 million debt accumulated from construction of the company's Terrace sawmill, improvements to its Walson Island pulp mill and purchase of the Carnaby mill, In effect Repap has extended its _ overall debt to reflect the life of its economic assets, said compa- ny spokesman Daniel Veniez. The result is more. cash for normal operations, he said. Venicz compared the refinanc- ‘ing toa family extending mort- gage payments from a 15-year ' term to one of 20 years, ..“There was a greater demand . for stock than we could supply. That shows you the kind of con- fidence there is out there in Repap,”’ he said. The Canadian share issue went aut at $4 but demand pushed the value to $6. It has now fallen 9 20 THE FINANCIAL end of Repap and Skeena Cellulose is a litte more stable thanks to share issues and debt restructuring and that’s good news for the Skeena Cellulose's local mill. That’s human resources managery Bob Black, pictured above, overlooking some of the activity, back a bil, but is much healthier than when stock was trading at $1.40 or so just a while ago. Repap’s investments since the 198Cs gave it a debt of more than $2 billion. The demand to service that debt combined with a down tum in the pulp industry to squeeze the com- pany dry of cash, There had even been worries Repap might not be able to sur- vive. Company not out of the woods REPAP’S BUSINESS may be in the woods but the latest refinanc- ing doesn’t mean it has complete- ly found a way out, says a vice president of ils Skecna Cellulose subsidiary, Reg Lightfoot said the compa- ny’s sale of shares and extension of principal payments must still be placed against a tough market for ils products, “Our pulp operations aren’t making money yet but we're losing less money all the time,’’ he said. The reality in the northwest has been a temporary shut down of some of Skeena Cellulose’s pulp production in Prince Rupert. Suppliers and contractors are also getting paid later than is normal and last year, the compa- Out & About ny pot on hold a profit sharing plan with employees at its saw- mill here. “We're not out of the soup yet,”’ said Lightfoot who is in the area this weck talking to some of ° Skeena Cellulose’s logging con- tractors. That message is also being delivered to Skeena Cellulose employees in Smithers, at Camaby, here and in Prince Rupert. ‘Our commitment is to bring back the profit sharing as soon as we can,’’ said Lightfoot. He did say high lumber prices combined with increased ef- ficiency and production at the sawmill here have greatly helped the company’s overall financial position. “But you should remember what Repap did was to invest in equipment,’’ said Veniez, adding that it places the company in the lead as pulp markets recover. He described the refinancing as one that shifis debt undertaken for specific projects to one that reflecis what the company pro- duces. “This is a whole new phase. We now have the flexibility to go forward,” said Veniez. Repap was also hurt in the late 1980s and early 1990s by a strong Canadian dollar when compared to the American dollar. That made Canadian products more expensive in the United States, a factor that changed in | _ the Jast few years. ! The refinancing also changed Repap’s voting and share owner- ship structure. Repap founder and major share- holder George Petty’s holdings used to give him 15 votes for na PNG! | Northern Gas Lid. DIVIDEND NOTICE NOTICE is hereby given that the Board of Diraciors of Pacitic Northern Gas Ltd. has declared a quarterly dividend of 22 cents per share on the issued and outstanding Class A and Glass B Commen Shares of the Corporation payable on March 22, 1994 to shareholders of record at the clase of business on March 8, 1994, a : By Ordar of the Board David G. Unruh Secretary RENOVATIONS AND - staff training are coming !0 an end as the city’s newest restaurant prepares fora Feb. 21 opening. White Spot is located in the Coast Inn of the West and is the first such franchise to be located in a hotel. The 158-seal restaurant is the only the second White Spot, after one in Prince George, in nortern B.C. And it’s the 11th franchise to be given since White Spot last year announced it was expanding its operations. ‘The manager here is Doug Bar- rett, formerly the manager at White Spot's Kamloops kakk Spring may look like It’s having a hard time breaking through winter, but the highways ministry isn’t take any chances, Seasonal load restrictions, . restaprant. needed to reduce vehicle weights - so roads arcn’t damaged during spring thaws, are already in place. ‘Heavy loads on thawing high- ways can be very damaging to the road’s surface ank| sub-base, re- quiring expensive repairs,’’ sald ministry regional director Jon Buckle last week, Restrictions are ordered after frost probes, weather data and roudway strength. tests are brought into play. ; a: x @r Presenting Something old, something . new...so many details you pe don’t know what to do? Then turn to our wedding guide and planning supplement inthe ° Wednesday, March 16 edition. It's filled with everything you need to know to make your on special day positively perfect! &e For Ad Space Contact: a STANDARD 4647 Lazelle Ave, 638-7283 | every share he held. The share structure is now one vote for each share. And Petiy’s personal holdings have dropped, from approximate- ly 32 per cent before to 24 per cent now. Pelty remains as ‘the single largest shareholderof Repap. One of those who had predicted a dire Cuture for Repap is. Ross Healy of SAC Solvency Analysis Corp. of Toronto. “Back ftom the brink, back from the brink,”’ was how Healy described the refinancing last week. '* Public Involvement in Crown Lands LAND AND RESOURCE SEMINAR SERIES — A weekly series of lectures, panel discussions and _ debates on the range of land and resource Issues’ including: Feb. 17 Feb, 24 March 3 © March 17 March 24 * Timber Supply in Kalum South * Integrated Resource Management ~ * Timber Harvesting Tenure System * Total Resource Management Planning Management * Ecosystem Networks « * Fish and Wildlife * Use of Crown Land for Non-Timber Resource Users - Commercial and Non-Commercial * Roundtable Discussion on Major Forest Land Issues * New Forestry March 31 April 7 April 14 > April: 21 - : 7 April 28 Thursday Evenings TREES FISH _ Northwest RECREATION Community WILD PLANTS. College MINERALS WATER SOIL 7:30 pm ~ Room 2002 — ‘. (under Cafeteria) for more information....., Gerry Bloomer 639-9400 Norma Kerby 635-6511 Carl Johansen 638-5022 x Co-sponsored by; Kalum South Community Resources Board, Northwest Community College, Kalum Forest District Office Mt Layton Hotspnin Ss Tumo Ministry of Transportation and Highways We Want to Hear ~ From You About = S Our Shoulders © Me You’ re invited mos tojoinour ~ evaluation team! | “The Ministry of Transportation and Highways is currently testing new methods of - improving the visibility and durability of highway pavement . markings in your area. The test . Section is indicated on the map “on the left. If you: would like to be part of the evaluation team and receive. a questionnaire, cail your local. Ministry of Transportation ; and “Highways office at : 1-800-663-9910, .