Guest 50centdollars Posted March 13, 2014 Share Posted March 13, 2014 http://seekingalpha.com/article/2082793-fortress-paper-ltd-a-misunderstood-unfollowed-gem-with-multiple-catalysts-in-place Link to comment Share on other sites More sharing options...
HeresyValue Posted March 16, 2014 Share Posted March 16, 2014 Too many of you fell for pumpers-and-dumpers disguised as value investors (of whom there are at least several on this board). Quite an expensive lesson to learn. Link to comment Share on other sites More sharing options...
BargainValueHunter Posted March 16, 2014 Share Posted March 16, 2014 Too many of you fell for pumpers-and-dumpers disguised as value investors (of whom there are at least several on this board). Quite an expensive lesson to learn. Are you saying that 206 pages of forum postings on this company are mostly an organized effort to pump up a worthless stock? I haven't known CoBaF members to behave in such a manner. Link to comment Share on other sites More sharing options...
Green King Posted March 16, 2014 Share Posted March 16, 2014 Too many of you fell for pumpers-and-dumpers disguised as value investors (of whom there are at least several on this board). Quite an expensive lesson to learn. Not this one this is just a bad business (commodity) with a high reproduction cost. So one has to wait until there is a supply shortage and sell. this could be a long wait or a trap too hard to tell. Link to comment Share on other sites More sharing options...
sculpin Posted March 18, 2014 Share Posted March 18, 2014 With so much focus on the Dissolving Pulp segment, there has been little discussion of the prospects of the Security Paper division. With potential of an order at the Optical Fibre division and increasing amount of Durasafe this division could end up being a key value driver for the overall Company. I highlight the following comment from the Munich report... The tiny Fortress Optical Features business is currently EBITDA neutral, being at 16% capacity (worst case). There are two late stage talks with customers, each of which could bring capacity to 100% and around CAD 10mm EBITDA (favorable case). The potential of Landquart has been masked by the strength of the Swiss franc and slower take-up of the higher value security paper over the last 2 years. Increased sales of Durasafe & a weakened SF could very well lead to Munich's attainment of $30MM EBITDA for this division in a few years. Assumptions made for the evaluation of the Security Paper Products Segment: Fortress Optical Features in Quebec is evaluated together with Landqart. CAD 140-160mm revenues in the next 2-3 years (2013 was approximately CAD 120mm). CAD 30mm EBITDA in 2-3 years from Landqart and CAD 0mm net income from metal thread business of Fortress Optical Features as base case. Capacity utilization is expected to be 80% this year and 90% next year due to new orders. Average price per ton of CAD 17.5k. The price per ton of sold paper in the Landqart mill tripled within one year from 2010 to 2011 due to the conversion to a pure security paper producer. In the last recent quarters the average price further increased due to the launch of higher margin products such as Durasafe. We expect the trend to continue as more Durasafe orders are being initiated. Attainment of $30MM EBITDA at Landquart & upside potential of another $10MM from Optical could easily see FTP's value in Landquart and Optical over $300 million at some point in the next 2 years. Thoughts? Link to comment Share on other sites More sharing options...
sculpin Posted March 19, 2014 Share Posted March 19, 2014 Another negative broker report (CIBC).... Fortress Paper Ltd. Q4 Results Below Expectations - Waiting On Two Important Developments FTP posted poor Q4/2013 results driven by lack of sales of dissolving pulp due to Chinese duties. Q1/2014 results will likely be equally poor. Final duty determinations from China are due April 6, 2014 and a lower final duty is possible. Debt restructuring negotiations underway may impact share value. 2014 EPS estimate is now at -$3.56 (previously we were at -$2.42) and for 2015 our EPS estimate is revised to -$0.96 (previously we were at -$0.33). EBITDA for 2014 is revised to -$13.7 million (previously at -$2.7 million) and 2015 to $21.7 million (previously at $22.1 million). Without duty relief, we are modeling the Thurso pulp mill to have an EBITDA loss in 2014 of $9.7 million. Our forecast Q1/2014 loss at Thurso is $10.5 million, with breakeven performance modeled for balance of 2014. FTP has yet to meet or exceed operational expectations at Thurso. We maintain our Sector Underperformer rating and lower our price target from $4.50 to $3.00, representing a small discount to our $3.10 revised NAV. Operational improvements at the Thurso mill, duty relief, and debt restructuring will be needed to generate any upside in FTP. Link to comment Share on other sites More sharing options...
alertmeipp Posted March 19, 2014 Share Posted March 19, 2014 They see the bearish case alright, the interesting thing about this is what if things started to turn to our favour. Downside very limited in next year or so but upside can be pretty good. Link to comment Share on other sites More sharing options...
sculpin Posted March 20, 2014 Share Posted March 20, 2014 If a Few Things Go Right Fortress beginning to reflect the potential for a few things to go right after a constant barrage of negative events. If on the Thurso pulp business: * tariffs are reduced somewhat, * they are able to bring on a few more cost saving initiatives currently planned * DP price moves back to $1000 * Cdn $ stays low or goes lower On the Lanquart side: * Swiss franc depreciates somewhat * more Durasafe orders are brought online * Fortress Optical gets a capacity order By 2016 we could have Fortress producing in excess of $30MM EBITDA at both Thurso and Landquart. Valuing Thurso at 6 multiple and Landquart at an 8 multiple puts a value of $420 MM on these 2 businesses. With $75 million in cash (assuming cash neutral til then) and debt of $240 million would result in an equity value of about $17 per share. Link to comment Share on other sites More sharing options...
lessthaniv Posted March 21, 2014 Share Posted March 21, 2014 Hey Sculpin, That's pretty much how I'm thinking of things at the moment. I've been painfully averaging down over time but I'm at a point where $17 makes a lot a money. I expect the recovery in DP to be slow/progressive but ultimately $1000 may be too low and the Chinese costs appear higher by most accounts. I've been trying to get more information on the Optical business. Any idea where Munich got the information on the "late stage talks". I suspect it must have come from an investor meeting.... Link to comment Share on other sites More sharing options...
sculpin Posted March 21, 2014 Share Posted March 21, 2014 Yes I would like more info on this business line as well. Potential for 2 orders with either one filling capacity and providing $10MM EBITDA is quite material & significant to FTP at this stage. Would like to try to get a one on one meeting with Chad soon. Link to comment Share on other sites More sharing options...
triedtestedand Posted March 21, 2014 Share Posted March 21, 2014 Sculpin/<IV: Check out discussion thread in/around Jan23 timeframe ... Chad had a investor panel preso at a conference in Whistler that was audiotaped ... wrote some notes on it back then. That's the only context I've heard. https://webcasts.welcome2theshow.com/whistler2014/pulp-panel Link to comment Share on other sites More sharing options...
colinwalt Posted March 22, 2014 Share Posted March 22, 2014 Sculpin/<IV: Check out discussion thread in/around Jan23 timeframe ... Chad had a investor panel preso at a conference in Whistler that was audiotaped ... wrote some notes on it back then. That's the only context I've heard. https://webcasts.welcome2theshow.com/whistler2014/pulp-panel Thanks triedtestedand... And here's a direct link to triedtestedand's great notes: http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/ftp-fortress-paper/msg153721/#msg153721 Link to comment Share on other sites More sharing options...
alertmeipp Posted March 26, 2014 Share Posted March 26, 2014 I thought this will go up forever. :'( Are you guys adding more or reducing before the potential final decision date? Link to comment Share on other sites More sharing options...
obtuse_investor Posted March 26, 2014 Share Posted March 26, 2014 I haven't made any trades in last 30 days-- Just sitting pretty right now. Duty drop would be nice and this is precisely what the market is discounting. When the news comes out the price is bound to drop. Link to comment Share on other sites More sharing options...
alertmeipp Posted March 26, 2014 Share Posted March 26, 2014 Disagree, I think the share price then will largely depends on the news itself. i.e. It will run hard if it gets reduced to 5%, etc... And besides, they can potentially have other good news soon on other fronts. Link to comment Share on other sites More sharing options...
lessthaniv Posted March 27, 2014 Share Posted March 27, 2014 Here is a recent interview that Chad did for Paper Week Canada. A pretty honest account and a few tidbits of info. Link to comment Share on other sites More sharing options...
beerbaron Posted March 28, 2014 Share Posted March 28, 2014 Here is a recent interview that Chad did for Paper Week Canada. A pretty honest account and a few tidbits of info. So how did the newsprint duty workout in 1999? How long did it take to solve it? BeerBaron Link to comment Share on other sites More sharing options...
motownsf Posted March 28, 2014 Share Posted March 28, 2014 This was an expensive lesson for many of us, myself included. Quite possibly my worst investment ever, which is a shame given all of the other opportunities available. Everyone has a few of these. Link to comment Share on other sites More sharing options...
lessthaniv Posted March 28, 2014 Share Posted March 28, 2014 Here is a recent interview that Chad did for Paper Week Canada. A pretty honest account and a few tidbits of info. So how did the newsprint duty workout in 1999? How long did it take to solve it? BeerBaron http://www.reuters.com/article/2009/06/30/china-economy-dumping-idUSPEK5517720090630 (Reuters) - China has cancelled punitive tariffs on newsprint paper imports from the United States, Canada and South Korea, marking an end to anti-dumping duties that it launched a decade ago. China's foreign trade ministry, the predecessor of the current Ministry of Commerce, in June 1999 imposed a tariff of up to 78 percent on newsprint paper imports from the three countries as a way to protect its local industry. It was the first time that China had imposed anti-dumping measures, making the case a focus of attention in Chinese industrial and legal circles. The Ministry of Commerce said on Tuesday that the tariff would end on June 30. According to the World Trade Organisation, China initiated 11 anti-dumping investigations in the second half of 2008, the third most by any country apart from India and Brazil, which investigated 42 and 16 cases, respectively. China has been the biggest target of anti-dumping probes over the last 14 years. In 2008, China was the subject of 73 new anti-dumping investigations, fully one-third of the 208 probes worldwide. China's exports have exploded in the past decade, reaching $1.43 trillion in 2008 from $195 billion in 1999. Beijing lashed out on Monday after the U.S. commerce department opened its third anti-dumping investigation against Chinese steel imports in 10 days, saying that it was shocked by U.S. trade protectionism. Link to comment Share on other sites More sharing options...
OptsyEagle Posted March 28, 2014 Share Posted March 28, 2014 (Reuters) - China has cancelled punitive tariffs on newsprint paper imports from the United States, Canada and South Korea, marking an end to anti-dumping duties that it launched a decade ago. We definitely cannot wait 10 years. Link to comment Share on other sites More sharing options...
alertmeipp Posted March 28, 2014 Share Posted March 28, 2014 We will know in couple weeks. I believe we can see high teens if they get the duties lowered and cost does come down to 700. Finger crossed. Link to comment Share on other sites More sharing options...
beerbaron Posted March 29, 2014 Share Posted March 29, 2014 We will know in couple weeks. I believe we can see high teens if they get the duties lowered and cost does come down to 700. Finger crossed. This seems unlikely, cross your toes as well! Chad mentions it fairly well, it's a political game, and when it comes to China foreigners always end up with the bad hand. BeerBaron Link to comment Share on other sites More sharing options...
alertmeipp Posted March 30, 2014 Share Posted March 30, 2014 We will know in couple weeks. I believe we can see high teens if they get the duties lowered and cost does come down to 700. Finger crossed. This seems unlikely, cross your toes as well! Chad mentions it fairly well, it's a political game, and when it comes to China foreigners always end up with the bad hand. BeerBaron Agree, or else this will not be selling at 4. But I think the risk/reward at current price is still highly favorable. Link to comment Share on other sites More sharing options...
Liberty Posted March 31, 2014 Author Share Posted March 31, 2014 VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 31, 2014) - Fortress Paper Ltd. ("Fortress Paper" or the "Company") (TSX:FTP) announced today that it has been granted a deferral on its upcoming principal payment under its $102.4 million project financing loan with Investissement Quebec (the "IQ Loan") relating to its Fortress Specialty Cellulose Mill. The Company received, without penalty, a deferral of approximately $4.3 million in principal repayment which was payable in the second quarter of 2014. This principal payment deferral is in addition to the previously disclosed deferral of approximately $5.3 million in principal and interest payments which were payable during the first quarter of 2014 under the IQ Loan. The purpose of these deferrals is to provide the Company with greater financial flexibility and increased working capital. Chadwick Wasilenkoff, Chief Executive Officer of Fortress Paper, commented: "The recent principal payment deferral enhances the financial flexibility of Fortress Paper and is reflective of our positive ongoing partnership with Investissement Quebec (IQ) during this transitory period in the dissolving pulp industry. This interim measure is greatly appreciated while we continue to work towards a more meaningful and long-term structure that would further enhance the Company's financial flexibility." Mr. Wasilenkoff further added, "We feel current market conditions in dissolving pulp are not sustainable and not reflective of the medium to long-term growth in demand. We feel the flexibility provided by IQ together with the progress we have made in stabilizing our Security Papers division should provide Fortress Paper a firm base to build towards an improved outlook for 2014. In addition, we will continue to explore and evaluate various opportunities to further enhance shareholder value in the short and medium-term." Link to comment Share on other sites More sharing options...
alertmeipp Posted March 31, 2014 Share Posted March 31, 2014 I didn't expect the share price to tank with this good news. :-\ Link to comment Share on other sites More sharing options...
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