Fortress Global Enterprises Announces Market Downtime
TSX: FGE
OTCQX: FTPLF
VANCOUVER, Oct. 7, 2019 /CNW/ - Fortress Global Enterprises Inc. ("Fortress" or the "Company") (TSX:FGE) (OTCQX:FTPLF) announced today that it will be taking market downtime at the Fortress Specialty Cellulose Mill (the "FSC Mill") in Thurso, Québec. The ongoing United States-China trade dispute, as well as weakening Chinese domestic textile and apparel consumption has destabilized the demand for dissolving pulp and caused a significant decline in pricing. As a result, the Company will deploy a temporary market curtailment strategy to preserve the option of restarting the mill once prices rebound.
Accordingly, the Company will take market downtime at the FSC Mill commencing October 8th, 2019 for an unspecified interim period. Market downtime will allow the Company to manage its dissolving pulp inventory build-up, which has resulted from the recent uncertainty in pricing and demand, and execute on its previously announced strategic and financing initiative (the "Strategic Initiative").
Giovanni Iadeluca, Chief Executive Officer of the Company, commented: "As a result of a thorough evaluation of the current economics at the FSC Mill, the Company has determined to take market downtime given the prevailing market conditions. This market curtailment strategy will allow us to focus our efforts on executing on the Strategic Initiative, as well as planning the optimized restart of the mill. We have also proactively allocated resources to enable us to restart the FSC Mill on an expedited basis in order to take advantage of any significant rebound in dissolving pulp pricing. We continue to be confident in the future pricing and prospects for dissolving pulp as the market adjusts to currently volatile conditions, as we believe that the underlying supply and demand fundamentals remain stable."
The Company
Fortress operates its dissolving pulp business at the FSC Mill located in Thurso, Québec, which also operates in the renewable energy generation sector through its cogeneration facility. Fortress operates its bioproducts business through Fortress Advanced Bioproducts Inc., which has laboratory and pilot plant facilities in Vancouver, British Columbia.
This press release contains certain forward-looking statements that reflect the current views and/or expectations of Fortress with respect to its performance, business and future events, including statements regarding cash flow, growth and future prospects of our business, market conditions for dissolving pulp, our perceptions of the industry and markets in which we operate and anticipated trends in such markets, the length of time for the market downtime at the FSC Mill, future reductions in costs at the FSC Mill and the FSC Mill's future productivity and reliability. The reader is cautioned that forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other factors which are difficult to predict and that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the business and the industry and markets in which the Company operates. Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions which are difficult to predict. Assumptions underlying the Company's expectations regarding forward looking statements contained in this news release include, among others: that the current depressed dissolving pulp prices are indicative of unusual market conditions and are not sustainable in the long-term and that the supply of dissolving pulp will decrease and lead to a price increase in the short- to medium-term. Investors are cautioned that all forward-looking statements involve risks and uncertainties including, without limitation, that market conditions for dissolving pulp will remain unfavourable, that trade disputes will continue or worsen and that the FSC Mill cost structure will not improve. These risks, as well as others, could cause actual results and events to vary significantly. Accordingly, readers should not place undue reliance on forward-looking statements, which are qualified in their entirety by this cautionary statement. Fortress does not undertake any obligations to release publicly any revisions for updating any voluntary forward looking statements, except as required by applicable securities law.
SOURCE Fortress Global Enterprises Inc.
Fortress Global Enterprises Inc., 604-904-2328 or [email protected]
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