A soaring Canadian dollar and plummeting newsprint demand has forced Catalyst Paper Corp. (TSX:CTL) to cut 315 jobs in its effort to return to profitability.
The company is shutting down one of its paper machines at its Port Alberni mill, which will result in 185 workers losing their jobs.
The September 1 shutdown is expected to save the company $8 million in expenses and eliminate 134,000 tonnes of newsprint production.
With pulp prices soaring, newsprint demand decreasing and a Canadian dollar topping 30-year highs, newsprint has been one of the company's least profitable products.
Catalyst will also chop 130 jobs as it moves its head office to Richmond from its downtown Vancouver location. The company said the move, which will centralize its corporate operations, will save about $16 million a year, but will result in a one-time charge of $19 million.
Catalyst has struggled to make a profit since 2001, racking up more than $70 million in losses in the past three years alone. While managing to reduce its net loss last year by 37% to $15.9 million from a net loss of $25.9 million in the previous year, Catalyst sales have stayed relatively flat between $1.8 billion and $1.9 billion in the past three years.
Catalyst's share price range during the past week: between $3.38 and $3.45; 52-week high: $4.31; 52-week low: $2.47.