Lumber and paper producer Weyerhaeuser Co. on Wednesday posted a first-quarter loss because of a huge charge related to its fine-paper business, which the company said it may sell.
The Federal Way-based company posted a quarterly loss of $580 million, or $2.36 per share, compared with earnings of $239 million, or 98 cents per share, during the same period a year ago.
Excluding a goodwill impairment charge of $746 million, or $3.03 per share, related to the fine-paper business, the company earned $166 million, or 67 cents per share.
The company said the quarter’s results also included a one-time gain of 5 cents per share for insurance recoveries, a charge of 7 cents a share for foreign exchange losses and stock options costs of 6 cents a share.
Without the one-time items, Weyerhaeuser would have earned 75 cents per share, short of what Wall Street was expecting.
For the three-month period ended March 26, sales were essentially flat at about $5.38 billion, compared with $5.37 billion in the year-ago period.
Analysts, on average, were looking for earnings of 84 cents per share on sales of $5.48 billion, according to a poll by Thomson Financial.
Weyerhaeuser has spent the last year reviewing ways to improve its business and has already made changes including closing some operations.
On Tuesday, the company said it is now considering selling all or part of the fine-paper business. Weyerhaeuser added that it was in active discussions with several parties about the business, but executives said they couldn’t yet say what might happen.
Steven Rogel, the company’s chairman, president and chief executive, reiterated the company’s commitment to making necessary corporate changes to please shareholders. For example, he noted the company is seeing signs of market improvements in the current second quarter in areas including fine paper and containerboard. But he said that the company was still committed to doing other things to improve the business.
“We are not relying on the market to help us deliver stronger shareholder returns,” he said.