Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jul. 04, 2020 | |
Document And Entity Information [Abstract] | |
Entity Registrant Name | Norbord Inc. |
Entity Central Index Key | 0000877365 |
Current Fiscal Year End Date | --12-31 |
Document Type | 6-K |
Document Period End Date | Jul. 4, 2020 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | Q2 |
Amendment Flag | false |
Amendment Description |
Interim Consolidated Balance Sh
Interim Consolidated Balance Sheets - USD ($) $ in Millions | Jul. 04, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 20 | $ 20 |
Accounts receivable | 137 | 136 |
Taxes receivable | 12 | 63 |
Inventory | 208 | 230 |
Prepaids | 8 | 13 |
Current assets | 385 | 462 |
Non-current assets | ||
Property, plant and equipment | 1,367 | 1,427 |
Intangible assets | 20 | 21 |
Deferred income tax assets | 1 | 2 |
Other assets | 12 | 9 |
Non-current assets | 1,400 | 1,459 |
Assets | 1,785 | 1,921 |
Current liabilities | ||
Accounts payable and accrued liabilities | 201 | 259 |
Taxes payable | 1 | 1 |
Current liabilities | 202 | 260 |
Non-current liabilities | ||
Long-term debt | 657 | 657 |
Other long-term debt | 0 | 68 |
Other liabilities | 41 | 40 |
Deferred income tax liabilities | 199 | 192 |
Non-current liabilities | 897 | 957 |
Shareholders’ equity | 686 | 704 |
Liabilities and shareholders' equity | $ 1,785 | $ 1,921 |
Interim Consolidated Statements
Interim Consolidated Statements of Earnings - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Profit or loss [abstract] | ||||
Sales | $ 421 | $ 447 | $ 888 | $ 923 |
Cost of sales | (335) | (408) | (724) | (840) |
General and administrative expenses | (4) | (4) | (7) | (7) |
Depreciation and amortization | (32) | (34) | (67) | (69) |
Loss on disposal of assets | (3) | (1) | (3) | (1) |
Impairment loss | (16) | 0 | (16) | 0 |
Expense of restructuring activities | 0 | 2 | 0 | 2 |
Operating income (loss) | 31 | (2) | 71 | 4 |
Non-operating items: | ||||
Finance costs | (10) | (12) | (22) | (23) |
Interest income on deposits | 0 | 0 | 0 | 1 |
Gain (loss) arising from difference between carrying amount of financial liability extinguished and consideration paid | 0 | (10) | 0 | (10) |
Earnings (loss) before income tax | 21 | (24) | 49 | (28) |
Income tax (expense) recovery | (3) | 10 | (11) | 15 |
Profit (loss) | $ 18 | $ (14) | $ 38 | $ (13) |
Earnings (loss) per common share | ||||
Basic and diluted (in dollars per share) | $ 0.22 | $ (0.17) | $ 0.47 | $ (0.16) |
Interim Consolidated Statemen_2
Interim Consolidated Statements of Comprehensive Income Statement - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Statement of comprehensive income [abstract] | ||||
Earnings (loss) | $ 18 | $ (14) | $ 38 | $ (13) |
Items that will not be reclassified to earnings: | ||||
Actuarial gain (loss) | (5) | (4) | (1) | (5) |
Items that may be reclassified subsequently to earnings: | ||||
Other comprehensive income, net of tax, exchange differences on translation | 10 | (12) | (19) | (6) |
Other comprehensive income (loss), net of tax | 5 | (16) | (20) | (11) |
Comprehensive income (loss) | $ 23 | $ (30) | $ 18 | $ (24) |
Interim Consolidated Statemen_3
Interim Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Millions | Total | Share capital | Merger reserve | Contributed surplus | Retained deficit | Accumulated other comprehensive loss | |
Balance, beginning of period at Dec. 31, 2018 | $ 1,280 | $ (168) | $ (197) | ||||
Balance, end of period at Apr. 06, 2019 | 1,280 | (193) | (192) | ||||
Balance, beginning of period at Dec. 31, 2018 | 1,280 | (168) | (197) | ||||
Issue of common shares upon exercise of options | 0 | ||||||
Stock options exercised | $ 1 | ||||||
Earnings (loss) | (13) | (13) | |||||
Common shares repurchased and cancelled under ASPP | 24 | 18 | |||||
Cancellation of treasury shares | (24) | (19) | |||||
Common share dividends | (49) | ||||||
Other comprehensive income (loss) | (11) | (11) | |||||
Balance, end of period at Jul. 06, 2019 | 749 | 1,280 | $ (96) | $ 4 | (231) | [1] | (208) |
Balance, beginning of period at Apr. 06, 2019 | 1,280 | (193) | (192) | ||||
Issue of common shares upon exercise of options | 0 | ||||||
Earnings (loss) | (14) | (14) | |||||
Common shares repurchased and cancelled under ASPP | 0 | 0 | |||||
Cancellation of treasury shares | 0 | 0 | |||||
Common share dividends | (24) | ||||||
Other comprehensive income (loss) | (16) | (16) | |||||
Balance, end of period at Jul. 06, 2019 | 749 | 1,280 | (96) | 4 | (231) | [1] | (208) |
Equity [abstract] | |||||||
Deficit arising on cashless exercise of warrants in 2013 | (263) | ||||||
All other retained (deficit) earnings | 32 | ||||||
Balance, beginning of period at Dec. 31, 2019 | 704 | 1,278 | (299) | (183) | |||
Balance, end of period at Apr. 04, 2020 | 1,264 | (298) | (208) | ||||
Balance, beginning of period at Dec. 31, 2019 | 704 | 1,278 | (299) | (183) | |||
Issue of common shares upon exercise of options | 1 | ||||||
Stock options exercised | 1 | ||||||
Earnings (loss) | 38 | 38 | |||||
Common shares repurchased and cancelled under ASPP | 0 | 0 | |||||
Cancellation of treasury shares | (15) | (7) | |||||
Common share dividends | (15) | ||||||
Other comprehensive income (loss) | (20) | (20) | |||||
Balance, end of period at Jul. 04, 2020 | 686 | 1,264 | (96) | 4 | (283) | [1] | (203) |
Balance, beginning of period at Apr. 04, 2020 | 1,264 | (298) | (208) | ||||
Issue of common shares upon exercise of options | 0 | ||||||
Earnings (loss) | 18 | 18 | |||||
Common shares repurchased and cancelled under ASPP | 0 | 0 | |||||
Cancellation of treasury shares | 0 | 0 | |||||
Common share dividends | (3) | ||||||
Other comprehensive income (loss) | 5 | 5 | |||||
Balance, end of period at Jul. 04, 2020 | $ 686 | $ 1,264 | $ (96) | $ 4 | (283) | [1] | $ (203) |
Equity [abstract] | |||||||
Deficit arising on cashless exercise of warrants in 2013 | (263) | ||||||
All other retained (deficit) earnings | $ (20) | ||||||
[1] | (i) Retained deficit comprised of: Deficit arising on cashless exercise of warrants in 2013 $(263) $(263)All other retained (deficit) earnings (20) 32 $(283) $(231) |
Interim Consolidated Statemen_4
Interim Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Operating activities | ||||
Earnings (loss) | $ 18 | $ (14) | $ 38 | $ (13) |
Items not affecting cash: | ||||
Depreciation and amortization | 32 | 34 | 67 | 69 |
Deferred income tax | (24) | 11 | 7 | 32 |
Impairment loss | 16 | 0 | 16 | 0 |
Explanation of difference between operating lease commitments disclosed applying IAS 17 and lease liabilities recognised at date of initial application of IFRS 16 [text block] | 0 | 2 | 0 | 2 |
Costs on early extinguishment of 2020 Notes | 0 | 10 | 0 | 10 |
Loss on disposal of assets, net | 3 | 1 | 3 | 1 |
Other items | 4 | (11) | 8 | 7 |
Cash flows from (used in) operations | 49 | 33 | 139 | 108 |
Net change in non-cash operating working capital balances | 46 | 39 | (23) | (72) |
Net change in taxes receivable and taxes payable | 30 | (36) | 48 | (97) |
Cash flows from (used in) operating activities | 125 | 36 | 164 | (61) |
Investing activities | ||||
Investment in property, plant and equipment | (15) | (37) | (44) | (77) |
Investment in intangible assets | (1) | (1) | (2) | (1) |
Cash flows from (used in) investing activities | (16) | (38) | (46) | (78) |
Financing activities | ||||
Accounts receivable securitization (repayments) drawings | (95) | 2 | (68) | 82 |
Revolving bank lines repayments | (20) | 0 | 0 | 0 |
Issuance of debt | 0 | 350 | 0 | 350 |
Common share dividends paid | (3) | (24) | (15) | (49) |
Debt issuance costs | (1) | (4) | (1) | (4) |
Issue of common shares | 0 | 0 | 1 | 0 |
Payments to acquire or redeem entity's shares | 0 | 0 | (22) | (43) |
Payments of lease liabilities, classified as financing activities | (3) | (3) | (6) | (6) |
Cash flows from (used in) financing activities | (122) | 321 | (111) | 330 |
Foreign exchange revaluation on cash and cash equivalents held | 3 | (6) | (7) | (4) |
(Decrease) increase during period | (10) | 313 | 0 | 187 |
Balance, beginning of period | 30 | 2 | 20 | 128 |
Balance, end of period | $ 20 | $ 315 | $ 20 | $ 315 |
NATURE AND DESCRIPTION OF THE C
NATURE AND DESCRIPTION OF THE COMPANY | 6 Months Ended |
Jul. 04, 2020 | |
Corporate Information And Statement Of IFRS Compliance [Abstract] | |
NATURE AND DESCRIPTION OF THE COMPANY | NATURE AND DESCRIPTION OF THE COMPANY Norbord is an international producer of wood-based panels with 17 mills in the United States, Canada and Europe. Norbord is a publicly traded company listed on the Toronto Stock Exchange (TSX) and the New York Stock Exchange (NYSE). The ticker symbol on both exchanges is “OSB”. The Company is incorporated under the Canada Business Corporations Act and is headquartered in Toronto, Ontario, Canada. At period-end, Brookfield's interest was approximately 43% of the outstanding common shares of the Company. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jul. 04, 2020 | |
Significant Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES (a) Statement of Compliance These interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting , on a basis consistent with the accounting policies Norbord disclosed in its audited consolidated financial statements as at, and for the year ended December 31, 2019 unless noted otherwise in note 2(c). These interim financial statements do not contain all of the disclosures that are required in annual financial statements prepared under International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and should be read in conjunction with Norbord’s 2019 audited annual financial statements which include information necessary or useful to understanding Norbord’s business and financial statement presentation. Norbord’s interim results are not necessarily indicative of its results for a full year. These interim financial statements were authorized for issuance by the Board of Directors of the Company on August 4, 2020 . (b) Basis of Presentation These interim financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. (c) Changes in Accounting Policies (i) Financial Instruments In September 2019, the IASB issued amendments to IFRS 9 with regards to the interest rate benchmark reform. These amendments provide targeted relief for financial instruments qualifying for hedge accounting to address uncertainties related to the ongoing reform of interbank offered rates. The amendments became effective for the Company on January 1, 2020 and did not have any impact on its interim financial statements. (d) Future Changes in Accounting Policies (i) Property, Plant and Equipment In May 2020, the IASB issued amendments to IAS 16 with regards to sale proceeds before property, plant and equipment is available for intended use. These amendments include the requirement to recognize in earnings any proceeds and related costs from selling items produced while an asset is being prepared for its intended use, and clarify the requirement to capitalize costs of testing whether an asset is functioning properly. The amendments are effective on January 1, 2022. The Company is currently assessing the impact of these amendments on its financial statements. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 6 Months Ended |
Jul. 04, 2020 | |
Subclassifications of assets, liabilities and equities [abstract] | |
ACCOUNTS RECEIVABLE | ACCOUNTS RECEIVABLE The Company has the ability to draw up to $125 million under a multi-currency accounts receivable securitization program with a third-party trust sponsored by a highly rated Canadian financial institution. The program is revolving and has an evergreen commitment subject to termination on 12 months’ notice. Under the program, the Company has transferred substantially all of its present and future trade accounts receivable to the trust, on a fully serviced basis, for proceeds consisting of cash and deferred purchase price. However, the asset derecognition criteria under IFRS have not been met and the transferred accounts receivable remain recorded as an asset. At period-end, the Company had transferred but continued to recognize $122 million ( December 31, 2019 – $110 million ) in trade accounts receivable, and the Company recorded nil drawings as other long-term debt ( December 31, 2019 – $ 68 million ) relating to this financing program. The level of accounts receivable transferred under the program fluctuates with the level of shipment volumes, product prices and foreign exchange rates. The amount the Company is able to draw under the program at any point in time depends on the level of accounts receivable transferred and timing of cash settlements, concentration limits and enhancement ratios. At period-end, the maximum available drawings under the program was $67 million . The amount the Company chooses to draw under the program will fluctuate with the Company’s cash requirements at that point in time. Any drawings are presented as other long-term debt on the balance sheet and are excluded from the net debt to total capitalization calculation for financial covenant purposes (note 5). The utilization charge, which is based on money market rates plus a margin, and other program fees are recorded as finance costs. Year-to-date, the utilization charges on drawings ranged from 1.6% to 2.8% ( 2019 – 1.6% to 4.1% ). The securitization program contains no financial covenants; however, the program is subject to minimum credit-rating requirements. The Company must maintain a long-term issuer credit rating of at least single B (mid) or the equivalent. As at August 4, 2020 , the Company’s ratings were BB (Standard & Poor’s Ratings Services) and Ba1 (Moody’s Investors Service). |
INVENTORY
INVENTORY | 6 Months Ended |
Jul. 04, 2020 | |
Inventories [Abstract] | |
INVENTORY | INVENTORY (US $ millions) Jul 4, 2020 Dec 31, 2019 Raw materials $ 59 $ 62 Finished goods 65 81 Operating and maintenance supplies 84 87 $ 208 $ 230 At period-end, the provision to reflect inventories at the lower of cost and net realizable value was $19 million ( December 31, 2019 – $18 million ). |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jul. 04, 2020 | |
Financial Instruments [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT (US $ millions) Jul 4, 2020 Dec 31, 2019 Principal value 6.25% senior secured notes due April 2023 $ 315 $ 315 5.75% senior secured notes due July 2027 350 350 665 665 Less: Unamortized debt issue costs (8 ) (8 ) $ 657 $ 657 Revolving Bank Lines In May 2020, the Company completed an amendment to its committed revolving bank lines to extend the maturity date of the total aggregate commitment from May 2021 to May 2022 and to increase the aggregate commitment from $245 million to $300 million . The facility bears interest at money market rates plus a margin that varies with the Company’s credit rating. The bank lines are secured by a first lien on the Company’s North American OSB inventory and property, plant and equipment. This lien is shared pari passu with holders of the 2023 and 2027 senior secured notes. At period-end, none ( December 31, 2019 – none ) of the revolving bank lines were drawn as cash, $9 million ( December 31, 2019 – $8 million ) was utilized for letters of credit and guarantees and $291 million ( December 31, 2019 – $237 million ) was available to support short-term liquidity requirements. The revolving bank lines contain two quarterly financial covenants: minimum tangible net worth of $500 million and maximum net debt to total capitalization, book basis, of 65% . The Company was in compliance with the financial covenants at period-end. |
OTHER LIABILITIES
OTHER LIABILITIES | 6 Months Ended |
Jul. 04, 2020 | |
Subclassifications of assets, liabilities and equities [abstract] | |
OTHER LIABILITIES | OTHER LIABILITIES (US $ millions) Jul 4, 2020 Dec 31, 2019 Defined benefit pension obligations $ 20 $ 16 Lease obligations 12 12 Accrued employee benefits 5 6 Reforestation obligations 4 4 Unrealized monetary hedge loss — 1 Other — 1 $ 41 $ 40 |
LEASES (Notes)
LEASES (Notes) | 6 Months Ended |
Jul. 04, 2020 | |
Leases [Abstract] | |
LEASES | NOTE 7. LEASES During the quarter and year-to-date, $ 1 million (2019 – less than $1 million ) and $2 million (2019 – $1 million ), respectively, of payments related to short-term leases was included in cost of sales. During the quarter and year-to-date, finance costs include less than $1 million (2019 – less than $1 million ) related to lease liabilities. During the quarter and year-to-date, total cash outflows related to all leases were $4 million (2019 – $3 million ) and $8 million (2019 – $7 million ), respectively. Leases of certain production equipment contain residual value guarantees of the right-of-use assets at the end of the contract term. At period-end, the expected amount payable under these residual value guarantees was less than $1 million (2019 – less than $1 million ). |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 6 Months Ended |
Jul. 04, 2020 | |
Share Capital, Reserves, And Other Equity Interest [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Share Capital 6 mos 2020 6 mos 2019 Shares (millions) Amount (US $ millions) Shares (millions) Amount (US $ millions) Common shares outstanding, beginning of period 81.5 $ 1,278 81.7 $ 1,280 Issuance of common shares upon exercise of options 0.1 1 — — Reverse accrual for shares repurchased and/or cancelled in 2019 — — 1.6 24 Shares repurchased in 2018 and cancelled in 2019 — — (0.2 ) (2 ) Shares repurchased and cancelled in 2020 and 2019 (1.0 ) (15 ) (1.4 ) (22 ) Common shares outstanding, end of period 80.6 $ 1,264 81.7 $ 1,280 Normal Course Issuer Bid Program (NCIB) In October 2019, the Company renewed its NCIB in accordance with TSX rules. Under the NCIB, the Company may purchase up to 4,083,429 of its common shares, representing 5% of Norbord’s issued and outstanding common shares of 81,668,583 as of October 22, 2019, pursuant to TSX rules. Daily purchases of common shares may not exceed 72,970 shares subject to the Company’s ability to make “block” purchases under the rules of the TSX. In response to the COVID-19 pandemic, the TSX had temporarily doubled the daily purchase limit such that Norbord was permitted to purchase up to 145,940 shares per day until June 30, 2020. In December 2019, the Company entered into an automatic share purchase plan (ASPP) in order to facilitate the repurchase of its common shares under its NCIB during the regularly scheduled quarterly trading blackout period. During the first quarter of 2020, the Company repurchased and cancelled 0.1 million common shares under the ASPP for a total cost of $2 million , $1 million of which represents a reduction in share capital and the remaining $1 million was charged to retained earnings. During the first quarter of 2020, after expiry of the ASPP, the Company also repurchased and cancelled an additional 0.9 million common shares under the current NCIB program for a total cost of $20 million . Of the total cost, $14 million represents a reduction in share capital and the remaining $6 million was charged to retained earnings. There were no shares repurchased in the second quarter of 2020. Under its prior NCIB that commenced on November 5, 2018 and expired on November 4, 2019, the Company previously sought and received approval from the TSX to purchase up to 5,191,965 of its common shares, representing 10% of Norbord’s public float of 51,919,654 as of October 22, 2018, pursuant to TSX rules. Daily purchases of common shares could not exceed 79,704 subject to the Company’s ability to make “block” purchases under the rules of the TSX. The Company had exhausted its prior NCIB limit. During the first quarter of 2019, the Company repurchased and cancelled 1.4 million common shares under the prior ASPP for a total cost of $39 million . Of the total cost, $22 million represented a reduction in share capital and the remaining $17 million was charged to retained earnings. During the first quarter of 2019, 0.2 million shares purchased and accrued for in 2018 were also cancelled. Total cost relating to these shares was $4 million , of which $2 million represented a reduction in share capital and the remaining $2 million was charged to retained earnings. Purchases were made on the open market by the Company through the facilities of the TSX, the NYSE or Canadian or US alternative trading systems, if eligible, in accordance with the requirements of the TSX and applicable securities laws. The price that the Company paid for any such common shares was the market price of such shares at the time of acquisition. Merger Reserve On March 31, 2015, the Company and Ainsworth Lumber Co. Ltd. (Ainsworth) completed an arrangement under which the Company acquired all of the outstanding common shares of Ainsworth in an all-share transaction. The Company elected not to account for this transaction as a business combination under IFRS 3, Business Combinations , as the transaction represented a combination of entities under common control of Brookfield. Accordingly, the book values of the two entities were combined and no adjustments were made to reflect fair values or to recognize any new assets or liabilities of either entity. The merger reserve represents the difference between the fair value of the Norbord common shares on the date of issuance as consideration and the book value of Ainsworth’s net assets exchanged. Stock Options Year-to-date, no stock options were granted (2019 – no stock options) and stock option expense of less than $1 million was recorded with a corresponding increase in contributed surplus (2019 – less than $1 million ). Year-to-date, 0.1 million common shares (2019 – less than 0.1 million common shares) were issued as a result of options exercised under the stock option plan for total cash proceeds of $1 million (2019 – less than $1 million ) in addition to less than $1 million (2019 – less than $1 million ) representing the vested amount of stock options transferred from contributed surplus. Accumulated Other Comprehensive Loss (US $ millions) Jul 4, 2020 Dec 31, 2019 Foreign currency translation loss on foreign operations, net of tax of $(3) $ (164 ) $ (145 ) Net loss on hedge of net investment in foreign operations, net of tax of $3 (8 ) (8 ) Actuarial loss on defined benefit pension obligations, net of tax of $10 (31 ) (30 ) Accumulated other comprehensive loss, net of tax $ (203 ) $ (183 ) |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Share Capital 6 mos 2020 6 mos 2019 Shares (millions) Amount (US $ millions) Shares (millions) Amount (US $ millions) Common shares outstanding, beginning of period 81.5 $ 1,278 81.7 $ 1,280 Issuance of common shares upon exercise of options 0.1 1 — — Reverse accrual for shares repurchased and/or cancelled in 2019 — — 1.6 24 Shares repurchased in 2018 and cancelled in 2019 — — (0.2 ) (2 ) Shares repurchased and cancelled in 2020 and 2019 (1.0 ) (15 ) (1.4 ) (22 ) Common shares outstanding, end of period 80.6 $ 1,264 81.7 $ 1,280 Normal Course Issuer Bid Program (NCIB) In October 2019, the Company renewed its NCIB in accordance with TSX rules. Under the NCIB, the Company may purchase up to 4,083,429 of its common shares, representing 5% of Norbord’s issued and outstanding common shares of 81,668,583 as of October 22, 2019, pursuant to TSX rules. Daily purchases of common shares may not exceed 72,970 shares subject to the Company’s ability to make “block” purchases under the rules of the TSX. In response to the COVID-19 pandemic, the TSX had temporarily doubled the daily purchase limit such that Norbord was permitted to purchase up to 145,940 shares per day until June 30, 2020. In December 2019, the Company entered into an automatic share purchase plan (ASPP) in order to facilitate the repurchase of its common shares under its NCIB during the regularly scheduled quarterly trading blackout period. During the first quarter of 2020, the Company repurchased and cancelled 0.1 million common shares under the ASPP for a total cost of $2 million , $1 million of which represents a reduction in share capital and the remaining $1 million was charged to retained earnings. During the first quarter of 2020, after expiry of the ASPP, the Company also repurchased and cancelled an additional 0.9 million common shares under the current NCIB program for a total cost of $20 million . Of the total cost, $14 million represents a reduction in share capital and the remaining $6 million was charged to retained earnings. There were no shares repurchased in the second quarter of 2020. Under its prior NCIB that commenced on November 5, 2018 and expired on November 4, 2019, the Company previously sought and received approval from the TSX to purchase up to 5,191,965 of its common shares, representing 10% of Norbord’s public float of 51,919,654 as of October 22, 2018, pursuant to TSX rules. Daily purchases of common shares could not exceed 79,704 subject to the Company’s ability to make “block” purchases under the rules of the TSX. The Company had exhausted its prior NCIB limit. During the first quarter of 2019, the Company repurchased and cancelled 1.4 million common shares under the prior ASPP for a total cost of $39 million . Of the total cost, $22 million represented a reduction in share capital and the remaining $17 million was charged to retained earnings. During the first quarter of 2019, 0.2 million shares purchased and accrued for in 2018 were also cancelled. Total cost relating to these shares was $4 million , of which $2 million represented a reduction in share capital and the remaining $2 million was charged to retained earnings. Purchases were made on the open market by the Company through the facilities of the TSX, the NYSE or Canadian or US alternative trading systems, if eligible, in accordance with the requirements of the TSX and applicable securities laws. The price that the Company paid for any such common shares was the market price of such shares at the time of acquisition. Merger Reserve On March 31, 2015, the Company and Ainsworth Lumber Co. Ltd. (Ainsworth) completed an arrangement under which the Company acquired all of the outstanding common shares of Ainsworth in an all-share transaction. The Company elected not to account for this transaction as a business combination under IFRS 3, Business Combinations , as the transaction represented a combination of entities under common control of Brookfield. Accordingly, the book values of the two entities were combined and no adjustments were made to reflect fair values or to recognize any new assets or liabilities of either entity. The merger reserve represents the difference between the fair value of the Norbord common shares on the date of issuance as consideration and the book value of Ainsworth’s net assets exchanged. Stock Options Year-to-date, no stock options were granted (2019 – no stock options) and stock option expense of less than $1 million was recorded with a corresponding increase in contributed surplus (2019 – less than $1 million ). Year-to-date, 0.1 million common shares (2019 – less than 0.1 million common shares) were issued as a result of options exercised under the stock option plan for total cash proceeds of $1 million (2019 – less than $1 million ) in addition to less than $1 million (2019 – less than $1 million ) representing the vested amount of stock options transferred from contributed surplus. Accumulated Other Comprehensive Loss (US $ millions) Jul 4, 2020 Dec 31, 2019 Foreign currency translation loss on foreign operations, net of tax of $(3) $ (164 ) $ (145 ) Net loss on hedge of net investment in foreign operations, net of tax of $3 (8 ) (8 ) Actuarial loss on defined benefit pension obligations, net of tax of $10 (31 ) (30 ) Accumulated other comprehensive loss, net of tax $ (203 ) $ (183 ) |
INCOME TAX
INCOME TAX | 6 Months Ended |
Jul. 04, 2020 | |
Income Taxes [Abstract] | |
INCOME TAX | INCOME TAX Income tax (expense) recovery recognized in the statement of earnings comprises the following: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Current income tax (expense) recovery $ (27 ) $ 21 $ (4 ) $ 47 Deferred income tax recovery (expense) 24 (11 ) (7 ) (32 ) $ (3 ) $ 10 $ (11 ) $ 15 |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 6 Months Ended |
Jul. 04, 2020 | |
Earnings per share [abstract] | |
EARNINGS PER COMMON SHARE | EARNINGS (LOSS) PER COMMON SHARE (US $ millions, except share and per share information, unless otherwise noted) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Earnings (loss) available to common shareholders $ 18 $ (14 ) $ 38 $ (13 ) Common shares (millions): Weighted average number of common shares outstanding 80.6 81.7 81.1 81.9 Dilutive stock options (1) 0.1 — — — Diluted number of common shares 80.7 81.7 81.1 81.9 Earnings (loss) per common share: Basic and diluted $ 0.22 $ (0.17 ) $ 0.47 $ (0.16 ) (1) Applicable if dilutive and when the weighted average daily closing share price for the period was greater than the exercise price for stock options. For the quarter and year-to-date period, there were stock options of 1.5 million and 1.1 million , respectively, (quarter and year-to-date ended July 6, 2019 – 0.7 million ) that were not taken into account in the calculation of diluted earnings per share because their effect was anti-dilutive. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Jul. 04, 2020 | |
Cash Flow Statement [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Other items comprise: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Stock-based compensation $ 3 $ 1 $ 3 $ 2 Pension funding greater than expense (1 ) (1 ) (1 ) (2 ) Cash interest paid (greater) less than interest expense — (8 ) (1 ) 1 Amortization of debt issue costs 1 — 1 1 Unrealized loss on outstanding currency forwards — (3 ) — — Unrealized foreign exchange loss on translation of monetary balances 1 — 6 4 Other — — — 1 $ 4 $ (11 ) $ 8 $ 7 The net change in non-cash operating working capital balances comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash provided by (used for): Accounts receivable $ 7 $ 37 $ (9 ) $ 8 Prepaids 2 (2 ) 5 — Inventory 43 25 16 (14 ) Accounts payable and accrued liabilities (6 ) (21 ) (35 ) (66 ) $ 46 $ 39 $ (23 ) $ (72 ) Cash interest and income taxes comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash interest paid $ (11 ) $ (19 ) $ (24 ) $ (20 ) Cash interest received — — — 1 Cash income taxes paid — (16 ) (1 ) (66 ) Cash income taxes received 3 — 45 15 The net change in financial liabilities arising from financing activities comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Long-term debt $ — $ 346 $ — $ 346 Other long-term debt (95 ) 2 (68 ) 82 Revolving bank lines (20 ) — — — Net (decrease) increase in financial liabilities $ (115 ) $ 348 $ (68 ) $ 428 Cash and non-cash movements of changes in financial liabilities arising from financing activities comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash movements: Accounts receivable securitization (repayments) drawings $ (95 ) $ 2 $ (68 ) $ 82 Revolving bank lines repayments (20 ) — — — Issuance of debt — 350 — 350 Debt issuance costs (1 ) (4 ) (1 ) (4 ) (116 ) 348 (69 ) 428 Non-cash movements: Amortization of debt issue costs 1 — 1 1 Debt issuance costs — — — (1 ) 1 — 1 — Net (decrease) increase in financial liabilities $ (115 ) $ 348 $ (68 ) $ 428 |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 6 Months Ended |
Jul. 04, 2020 | |
Financial Instruments [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS Non-Derivative Financial Instruments The net book values and fair values of non-derivative financial instruments were as follows: Jul 4, 2020 Dec 31, 2019 (US $ millions) Financial Instrument Category Net Book Value Fair Value Net Book Value Fair Value Financial assets: Cash and cash equivalents Fair value through profit or loss $ 20 $ 20 $ 20 $ 20 Accounts receivable Amortised cost 137 137 136 136 Other assets (1) Amortised cost 2 2 1 1 $ 159 $ 159 $ 157 $ 157 Financial liabilities: Accounts payable and accrued liabilities Amortised cost $ 201 $ 201 $ 259 $ 259 Long-term debt (2) Amortised cost 665 690 665 702 Other long-term debt Amortised cost — — 68 68 Other liabilities (1) Amortised cost 9 9 12 12 $ 875 $ 900 $ 1,004 $ 1,041 (1) Excludes lease obligations and defined benefit pension asset and obligations scoped out of IFRS 9, Financial instruments (note 6). (2) Principal value of long-term debt excluding debt issue costs of $8 million (2019 – $8 million ) (note 5). The carrying values of the Company's non-derivative financial instruments approximate fair value, except where disclosed below. As at July 4, 2020 , the provision for doubtful accounts was less than $1 million ( December 31, 2019 – less than $1 million ). Derivative Financial Instruments Canadian Dollar Monetary Hedge At period-end, the Company had foreign currency forward contracts representing a notional amount of C $2 million ( December 31, 2019 – C $52 million ) in place to buy Canadian dollars and sell US dollars with maturities in July 2020 ( December 31, 2019 – buy US dollars and sell Canadian dollars). The fair value of these contracts at period-end is an unrealized gain of less than $1 million ( December 31, 2019 – an unrealized loss of $1 million ); the carrying value of the derivative instrument is equivalent to the unrealized gain at period-end. During the quarter, net realized gains on the Company's matured hedges were less than $1 million (2019 – net realized losses of $1 million ). Year-to-date, net realized gains on the Company's matured hedges were $2 million (2019 – less than $1 million ). Euro Cash Flow Hedge At period-end, the Company had no foreign currency options (December 31, 2019 – €30 million notional amount) in place to buy Pounds Sterling and sell Euros. The fair value of these contracts at period-end is nil ( December 31, 2019 – less than $1 million ). During the quarter, net realized losses on the Company's matured hedges were nil (2019 – less than $1 million ). Year-to-date, net realized losses on the Company's matured hedges were less than $1 million (2019 – less than $1 million ). Derivative instruments are measured at fair value as determined using valuation techniques under Level 2 of the fair value hierarchy. The fair values of over-the-counter derivative financial instruments are based on broker quotes or observable market rates. Those quotes are tested for reasonableness by discounting expected future cash flows using market interest and exchange rates for a similar instrument at the measurement date. Fair values reflect the credit risk of the instrument for the Company and counterparty when appropriate. Realized and unrealized gains and losses on derivative financial instruments are offset by realized and unrealized losses and gains on the underlying exposures being hedged and are recorded in earnings as they occur. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jul. 04, 2020 | |
Other Provisions, Contingent Liabilities And Contingent Assets [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company has provided certain guarantees, commitments and indemnifications, including those related to former businesses. The maximum amounts from many of these items cannot be reasonably estimated at this time. However, in certain circumstances, the Company has recourse against other parties to mitigate the risk of loss. In the normal course of its business activities, the Company is subject to claims and legal actions that may be made by its customers, suppliers and others. While the final outcome with respect to actions outstanding or pending as at period-end cannot be predicted with certainty, the Company believes the resolution will not have a material effect on the Company’s financial position, financial performance, or cash flows. The Company has entered into various commitments as follows: Payments Due by Period (US $ millions) Less than 1 Year 1–5 Years Thereafter Total Purchase commitments $ 26 $ 30 $ 39 $ 95 Lease obligations 8 10 4 22 Reforestation obligations 1 2 1 4 $ 35 $ 42 $ 44 $ 121 Purchase commitments relate to the purchase of property, plant and equipment and long-term purchase contracts with minimum fixed payment amounts. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jul. 04, 2020 | |
Related Party [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS In the normal course of operations, Norbord enters into various transactions with related parties which have been measured at exchange value and recognized in the interim financial statements. The following transactions have occurred between Norbord and its related parties during the normal course of business. Brookfield Norbord periodically engages the services of Brookfield and its affiliates for various financial, real estate and other business services. During the quarter and year-to-date, the fees for services rendered were less than $1 million (2019 – less than $1 million ). Other Sales to Asian markets are handled by Interex Forest Products Ltd. (Interex), a cooperative sales company over which Norbord, as a 25% shareholder, has significant influence. During the quarter and year-to-date, net sales of $15 million (2019 – $17 million ) and $28 million (2019 – $35 million ), respectively, were made to Interex. At period-end, $2 million ( December 31, 2019 – $4 million ) due from Interex was included in accounts receivable. At period-end, the investment in Interex was less than $1 million ( December 31, 2019 – less than $1 million ) and is included in other assets. |
GEOGRAPHIC SEGMENTS
GEOGRAPHIC SEGMENTS | 6 Months Ended |
Jul. 04, 2020 | |
Operating Segments [Abstract] | |
GEOGRAPHIC SEGMENTS | GEOGRAPHIC SEGMENTS The Company operates principally in North America and Europe. Sales by geographic segment are determined based on the origin of shipment. Q2 2020 (US $ millions) North America Europe Unallocated Total Sales $ 330 $ 91 $ — $ 421 EBITDA (1) 65 2 (4 ) 63 Depreciation and amortization 26 6 — 32 Additions to property, plant and equipment 10 3 — 13 Q2 2019 (US $ millions) North America Europe Unallocated Total Sales $ 317 $ 130 $ — $ 447 EBITDA (1) 15 21 (4 ) 32 Depreciation and amortization 28 6 — 34 Additions to property, plant and equipment 19 10 — 29 6 mos 2020 (US $ millions) North America Europe Unallocated Total Sales $ 676 $ 212 $ — $ 888 EBITDA (1) 133 12 (7 ) 138 Depreciation and amortization 55 12 — 67 Additions to property, plant and equipment 23 14 — 37 Property, plant and equipment 1,099 268 — 1,367 6 mos 2019 (US $ millions) North America Europe Unallocated Total Sales $ 647 $ 276 $ — $ 923 EBITDA (1) 38 42 (7 ) 73 Depreciation and amortization 56 13 — 69 Additions to property, plant and equipment 44 15 — 59 Property, plant and equipment (2) 1,147 280 — 1,427 (1) EBITDA is a non-IFRS financial measure, which the Company uses to assess segment performance and operating results. The Company defines EBITDA as earnings before finance costs, interest income, income tax, depreciation and amortization, and costs on early extinguishment of debt. Non-IFRS financial measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. (2) Balance as at December 31, 2019 . |
IMPACT OF COVID-19 (Notes)
IMPACT OF COVID-19 (Notes) | 6 Months Ended |
Jul. 04, 2020 | |
Subsequent Events [Abstract] | |
Impact of COVID-19 | NOTE 17. IMPACT OF COVID-19 During the second quarter, the ongoing COVID-19 pandemic negatively impacted demand for the Company's products in both North America and Europe, particularly in April, and the Company curtailed operations to match its production with this reduced customer demand. As the pandemic's severity and duration remains uncertain, the Company's business, financial results and financial condition could be negatively impacted in the future. The Company could experience other future impacts as a result of COVID-19, including, but not limited to, the carrying values of the Company's property, plant and equipment, the measurement of the assets and obligations under its defined benefit pension plans, its estimate of the annual effective tax rate for the year, and its allowance for expected credit losses. At this time, the Company is unable to estimate with a reasonable degree of confidence the extent of the impact of the COVID-19 pandemic on the Company’s future operating financial performance. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jul. 04, 2020 | |
Significant Accounting Policies [Abstract] | |
Description of accounting policy for fair value measurement [text block] | Derivative instruments are measured at fair value as determined using valuation techniques under Level 2 of the fair value hierarchy. The fair values of over-the-counter derivative financial instruments are based on broker quotes or observable market rates. Those quotes are tested for reasonableness by discounting expected future cash flows using market interest and exchange rates for a similar instrument at the measurement date. Fair values reflect the credit risk of the instrument for the Company and counterparty when appropriate. Realized and unrealized gains and losses on derivative financial instruments are offset by realized and unrealized losses and gains on the underlying exposures being hedged and are recorded in earnings as they occur. |
Statement of Compliance | Statement of Compliance These interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting , on a basis consistent with the accounting policies Norbord disclosed in its audited consolidated financial statements as at, and for the year ended December 31, 2019 unless noted otherwise in note 2(c). These interim financial statements do not contain all of the disclosures that are required in annual financial statements prepared under International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and should be read in conjunction with Norbord’s 2019 audited annual financial statements which include information necessary or useful to understanding Norbord’s business and financial statement presentation. Norbord’s interim results are not necessarily indicative of its results for a full year. These interim financial statements were authorized for issuance by the Board of Directors of the Company on August 4, 2020 . |
Basis of Measurement | (b) Basis of Presentation These interim financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. |
Changes in Accounting Policies | Changes in Accounting Policies (i) Financial Instruments In September 2019, the IASB issued amendments to IFRS 9 with regards to the interest rate benchmark reform. These amendments provide targeted relief for financial instruments qualifying for hedge accounting to address uncertainties related to the ongoing reform of interbank offered rates. The amendments became effective for the Company on January 1, 2020 and did not have any impact on its interim financial statements. |
Future Changes in Accounting Policies | Future Changes in Accounting Policies (i) Property, Plant and Equipment In May 2020, the IASB issued amendments to IAS 16 with regards to sale proceeds before property, plant and equipment is available for intended use. These amendments include the requirement to recognize in earnings any proceeds and related costs from selling items produced while an asset is being prepared for its intended use, and clarify the requirement to capitalize costs of testing whether an asset is functioning properly. The amendments are effective on January 1, 2022. The Company is currently assessing the impact of these amendments on its financial statements. |
Derivative instruments | NOTE 9. IMPAIRMENT OF ASSETS During the quarter, the Company recorded a non-cash impairment loss of $16 million related to idle production assets at the Grande Prairie, Alberta mill. These assets were deemed to be surplus following a review of the likelihood of their future use based on factors including relevant operating plans, raw material availability and the limited potential for redeployment of these assets. |
INVENTORY (Tables)
INVENTORY (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Inventories [Abstract] | |
Disclosure of inventory | (US $ millions) Jul 4, 2020 Dec 31, 2019 Raw materials $ 59 $ 62 Finished goods 65 81 Operating and maintenance supplies 84 87 $ 208 $ 230 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Financial Instruments [Abstract] | |
Disclosure of detailed information about borrowings | (US $ millions) Jul 4, 2020 Dec 31, 2019 Principal value 6.25% senior secured notes due April 2023 $ 315 $ 315 5.75% senior secured notes due July 2027 350 350 665 665 Less: Unamortized debt issue costs (8 ) (8 ) $ 657 $ 657 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Subclassifications of assets, liabilities and equities [abstract] | |
Disclosure of other liabilities | (US $ millions) Jul 4, 2020 Dec 31, 2019 Defined benefit pension obligations $ 20 $ 16 Lease obligations 12 12 Accrued employee benefits 5 6 Reforestation obligations 4 4 Unrealized monetary hedge loss — 1 Other — 1 $ 41 $ 40 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Share Capital, Reserves, And Other Equity Interest [Abstract] | |
Disclosure of classes of share capital | 6 mos 2020 6 mos 2019 Shares (millions) Amount (US $ millions) Shares (millions) Amount (US $ millions) Common shares outstanding, beginning of period 81.5 $ 1,278 81.7 $ 1,280 Issuance of common shares upon exercise of options 0.1 1 — — Reverse accrual for shares repurchased and/or cancelled in 2019 — — 1.6 24 Shares repurchased in 2018 and cancelled in 2019 — — (0.2 ) (2 ) Shares repurchased and cancelled in 2020 and 2019 (1.0 ) (15 ) (1.4 ) (22 ) Common shares outstanding, end of period 80.6 $ 1,264 81.7 $ 1,280 |
Disclosure of accumulated other comprehensive income (loss) | (US $ millions) Jul 4, 2020 Dec 31, 2019 Foreign currency translation loss on foreign operations, net of tax of $(3) $ (164 ) $ (145 ) Net loss on hedge of net investment in foreign operations, net of tax of $3 (8 ) (8 ) Actuarial loss on defined benefit pension obligations, net of tax of $10 (31 ) (30 ) Accumulated other comprehensive loss, net of tax $ (203 ) $ (183 ) |
INCOME TAX (Tables)
INCOME TAX (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Income Taxes [Abstract] | |
Disclosure of major components of tax expense (income) | Income tax (expense) recovery recognized in the statement of earnings comprises the following: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Current income tax (expense) recovery $ (27 ) $ 21 $ (4 ) $ 47 Deferred income tax recovery (expense) 24 (11 ) (7 ) (32 ) $ (3 ) $ 10 $ (11 ) $ 15 |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Earnings per share [abstract] | |
Disclosure of earnings per share | (US $ millions, except share and per share information, unless otherwise noted) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Earnings (loss) available to common shareholders $ 18 $ (14 ) $ 38 $ (13 ) Common shares (millions): Weighted average number of common shares outstanding 80.6 81.7 81.1 81.9 Dilutive stock options (1) 0.1 — — — Diluted number of common shares 80.7 81.7 81.1 81.9 Earnings (loss) per common share: Basic and diluted $ 0.22 $ (0.17 ) $ 0.47 $ (0.16 ) (1) Applicable if dilutive and when the weighted average daily closing share price for the period was greater than the exercise price for stock options. For the quarter and year-to-date period, there were stock options of 1.5 million and 1.1 million , respectively, (quarter and year-to-date ended July 6, 2019 – 0.7 million ) that were not taken into account in the calculation of diluted earnings per share because their effect was anti-dilutive. |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Cash Flow Statement [Abstract] | |
Disclosure of supplemental cash flow statement items | Other items comprise: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Stock-based compensation $ 3 $ 1 $ 3 $ 2 Pension funding greater than expense (1 ) (1 ) (1 ) (2 ) Cash interest paid (greater) less than interest expense — (8 ) (1 ) 1 Amortization of debt issue costs 1 — 1 1 Unrealized loss on outstanding currency forwards — (3 ) — — Unrealized foreign exchange loss on translation of monetary balances 1 — 6 4 Other — — — 1 $ 4 $ (11 ) $ 8 $ 7 The net change in non-cash operating working capital balances comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash provided by (used for): Accounts receivable $ 7 $ 37 $ (9 ) $ 8 Prepaids 2 (2 ) 5 — Inventory 43 25 16 (14 ) Accounts payable and accrued liabilities (6 ) (21 ) (35 ) (66 ) $ 46 $ 39 $ (23 ) $ (72 ) Cash interest and income taxes comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash interest paid $ (11 ) $ (19 ) $ (24 ) $ (20 ) Cash interest received — — — 1 Cash income taxes paid — (16 ) (1 ) (66 ) Cash income taxes received 3 — 45 15 The net change in financial liabilities arising from financing activities comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Long-term debt $ — $ 346 $ — $ 346 Other long-term debt (95 ) 2 (68 ) 82 Revolving bank lines (20 ) — — — Net (decrease) increase in financial liabilities $ (115 ) $ 348 $ (68 ) $ 428 Cash and non-cash movements of changes in financial liabilities arising from financing activities comprises: (US $ millions) Q2 2020 Q2 2019 6 mos 2020 6 mos 2019 Cash movements: Accounts receivable securitization (repayments) drawings $ (95 ) $ 2 $ (68 ) $ 82 Revolving bank lines repayments (20 ) — — — Issuance of debt — 350 — 350 Debt issuance costs (1 ) (4 ) (1 ) (4 ) (116 ) 348 (69 ) 428 Non-cash movements: Amortization of debt issue costs 1 — 1 1 Debt issuance costs — — — (1 ) 1 — 1 — Net (decrease) increase in financial liabilities $ (115 ) $ 348 $ (68 ) $ 428 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Financial Instruments [Abstract] | |
Disclosure of net book values and fair values of non-derivative financial assets | The net book values and fair values of non-derivative financial instruments were as follows: Jul 4, 2020 Dec 31, 2019 (US $ millions) Financial Instrument Category Net Book Value Fair Value Net Book Value Fair Value Financial assets: Cash and cash equivalents Fair value through profit or loss $ 20 $ 20 $ 20 $ 20 Accounts receivable Amortised cost 137 137 136 136 Other assets (1) Amortised cost 2 2 1 1 $ 159 $ 159 $ 157 $ 157 Financial liabilities: Accounts payable and accrued liabilities Amortised cost $ 201 $ 201 $ 259 $ 259 Long-term debt (2) Amortised cost 665 690 665 702 Other long-term debt Amortised cost — — 68 68 Other liabilities (1) Amortised cost 9 9 12 12 $ 875 $ 900 $ 1,004 $ 1,041 (1) Excludes lease obligations and defined benefit pension asset and obligations scoped out of IFRS 9, Financial instruments (note 6). (2) Principal value of long-term debt excluding debt issue costs of $8 million (2019 – $8 million ) (note 5). |
Disclosure of net book values and fair values of non-derivative financial liabilities | The net book values and fair values of non-derivative financial instruments were as follows: Jul 4, 2020 Dec 31, 2019 (US $ millions) Financial Instrument Category Net Book Value Fair Value Net Book Value Fair Value Financial assets: Cash and cash equivalents Fair value through profit or loss $ 20 $ 20 $ 20 $ 20 Accounts receivable Amortised cost 137 137 136 136 Other assets (1) Amortised cost 2 2 1 1 $ 159 $ 159 $ 157 $ 157 Financial liabilities: Accounts payable and accrued liabilities Amortised cost $ 201 $ 201 $ 259 $ 259 Long-term debt (2) Amortised cost 665 690 665 702 Other long-term debt Amortised cost — — 68 68 Other liabilities (1) Amortised cost 9 9 12 12 $ 875 $ 900 $ 1,004 $ 1,041 (1) Excludes lease obligations and defined benefit pension asset and obligations scoped out of IFRS 9, Financial instruments (note 6). (2) Principal value of long-term debt excluding debt issue costs of $8 million (2019 – $8 million ) (note 5). |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Other Provisions, Contingent Liabilities And Contingent Assets [Abstract] | |
Disclosure of commitments | The Company has entered into various commitments as follows: Payments Due by Period (US $ millions) Less than 1 Year 1–5 Years Thereafter Total Purchase commitments $ 26 $ 30 $ 39 $ 95 Lease obligations 8 10 4 22 Reforestation obligations 1 2 1 4 $ 35 $ 42 $ 44 $ 121 |
GEOGRAPHIC SEGMENTS (Tables)
GEOGRAPHIC SEGMENTS (Tables) | 6 Months Ended |
Jul. 04, 2020 | |
Operating Segments [Abstract] | |
Disclosure of geographical segments | Q2 2020 (US $ millions) North America Europe Unallocated Total Sales $ 330 $ 91 $ — $ 421 EBITDA (1) 65 2 (4 ) 63 Depreciation and amortization 26 6 — 32 Additions to property, plant and equipment 10 3 — 13 Q2 2019 (US $ millions) North America Europe Unallocated Total Sales $ 317 $ 130 $ — $ 447 EBITDA (1) 15 21 (4 ) 32 Depreciation and amortization 28 6 — 34 Additions to property, plant and equipment 19 10 — 29 6 mos 2020 (US $ millions) North America Europe Unallocated Total Sales $ 676 $ 212 $ — $ 888 EBITDA (1) 133 12 (7 ) 138 Depreciation and amortization 55 12 — 67 Additions to property, plant and equipment 23 14 — 37 Property, plant and equipment 1,099 268 — 1,367 6 mos 2019 (US $ millions) North America Europe Unallocated Total Sales $ 647 $ 276 $ — $ 923 EBITDA (1) 38 42 (7 ) 73 Depreciation and amortization 56 13 — 69 Additions to property, plant and equipment 44 15 — 59 Property, plant and equipment (2) 1,147 280 — 1,427 (1) EBITDA is a non-IFRS financial measure, which the Company uses to assess segment performance and operating results. The Company defines EBITDA as earnings before finance costs, interest income, income tax, depreciation and amortization, and costs on early extinguishment of debt. Non-IFRS financial measures do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. (2) Balance as at December 31, 2019 . |
NATURE AND DESCRIPTION OF THE_2
NATURE AND DESCRIPTION OF THE COMPANY (Details) | 6 Months Ended |
Jul. 04, 2020property | |
Disclosure of subsidiaries [line items] | |
Number of plant locations | 17 |
Brookfield | Norbord | |
Disclosure of subsidiaries [line items] | |
Proportion of ownership interest in subsidiary | 43.00% |
(Details)
(Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jul. 04, 2020 | Jul. 06, 2019 | Dec. 31, 2019 | |
Disclosure of continuing involvement in derecognised financial assets [line items] | |||
Termination notice of accounts receivable securitization program | 12 months | ||
Recognised other long-term debt relating to financing program | $ 0 | $ 68,000,000 | |
Securitisations | |||
Disclosure of continuing involvement in derecognised financial assets [line items] | |||
Recognised assets representing continuing involvement in derecognised financial assets, program amount | 125,000,000 | ||
Continuing Involvement, Maximum Amount of Borrowings | 122,000,000 | 110,000,000 | |
Recognised other long-term debt relating to financing program | $ 0 | $ 68,000,000 | |
Minimum | |||
Disclosure of continuing involvement in derecognised financial assets [line items] | |||
Utilisation rate on other long-term debt within securitization program | 1.60% | 1.60% | |
Maximum | |||
Disclosure of continuing involvement in derecognised financial assets [line items] | |||
Utilisation rate on other long-term debt within securitization program | 2.80% | 4.10% | |
Maximum | Securitisations | |||
Disclosure of continuing involvement in derecognised financial assets [line items] | |||
Continuing Involvement, Maximum Amount of Borrowings | $ 67,000,000 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Millions | Jul. 04, 2020 | Dec. 31, 2019 |
Inventories [Abstract] | ||
Raw materials | $ 59 | $ 62 |
Finished goods | 65 | 81 |
Operating and maintenance supplies | 84 | 87 |
Inventory | 208 | 230 |
Inventory provision | $ 19 | $ 18 |
LONG-TERM DEBT - Values of Debt
LONG-TERM DEBT - Values of Debt (Details) - USD ($) | Jul. 04, 2020 | Dec. 31, 2019 |
Disclosure of detailed information about borrowings [line items] | ||
Principal value | $ 665,000,000 | $ 665,000,000 |
Less: Unamortized debt issue costs | (8,000,000) | (8,000,000) |
Long-term debt | $ 657,000,000 | 657,000,000 |
6.25% senior secured notes due April 2023 | ||
Disclosure of detailed information about borrowings [line items] | ||
Borrowings, interest rate | 6.25% | |
Principal value | $ 315,000,000 | 315,000,000 |
5.75% senior secured notes due June 2027 | ||
Disclosure of detailed information about borrowings [line items] | ||
Borrowings, interest rate | 5.75% | |
Principal value | $ 350,000,000 | $ 350,000,000 |
LONG-TERM DEBT - Narrative (Det
LONG-TERM DEBT - Narrative (Details) - Revolving Bank Line - USD ($) | 6 Months Ended | ||
Jul. 04, 2020 | Apr. 30, 2020 | Dec. 31, 2019 | |
Disclosure of detailed information about borrowings [line items] | |||
Maximum borrowing capacity | $ 300,000,000 | $ 245,000,000 | |
Undrawn borrowing facilities | 0 | $ 0 | |
Letters of credit | 9,000,000 | 8,000,000 | |
Unutilized borrowing facilities | 291,000,000 | $ 237,000,000 | |
Minimum tangible net worth | $ 500,000,000 | ||
Maximum net debt to total capitalization | 65.00% |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - USD ($) $ in Millions | Jul. 04, 2020 | Dec. 31, 2019 |
Subclassifications of assets, liabilities and equities [abstract] | ||
Defined benefit pension obligation | $ 20 | $ 16 |
Non-current lease liabilities | 12 | 12 |
Accrued employee benefits | 5 | 6 |
Reforestation obligations | 4 | 4 |
Unrealized monetary hedge loss | 0 | 1 |
Other | 0 | 1 |
Other liabilities | $ 41 | $ 40 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Leases [Abstract] | ||||
Payments related to short term leases | $ 1 | $ 2 | $ 1 | |
Interest expense on lease liabilities | 1 | 1 | ||
Cash outflow for leases | $ 4 | $ 3 | $ 8 | $ 7 |
Information about lessee's exposure arising from residual value guarantees | 1000000 | 1000000 |
SHAREHOLDERS' EQUITY - Share Ca
SHAREHOLDERS' EQUITY - Share Capital (Details) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jul. 04, 2020USD ($)shares | Apr. 04, 2020USD ($)shares | Jul. 06, 2019USD ($)shares | Apr. 06, 2019USD ($)shares | Jul. 04, 2020USD ($)shares | Jul. 06, 2019USD ($)shares | |
Changes in equity [abstract] | ||||||
Balance, beginning of period | $ 704 | $ 704 | ||||
Balance, end of period | $ 686 | $ 749 | $ 686 | $ 749 | ||
Share capital | ||||||
Reconciliation of number of shares outstanding [abstract] | ||||||
Common shares outstanding, beginning of year (in shares) | shares | 81.5 | 81.7 | 81.5 | 81.7 | ||
Issuance of common shares upon exercise of options and DRIP (in shares) | shares | 0.1 | 0 | ||||
Reverse accrual for shares to be purchased and/or cancelled in 2019 (in shares) | shares | 0 | 1.6 | ||||
Shares repurchased in 2018 and cancelled in 2019 (in shares) | shares | 0 | (0.2) | ||||
Shares repurchased and cancelled in 2019 (in shares) | shares | (1) | (1.4) | ||||
Common shares outstanding, end of year (in shares) | shares | 80.6 | 81.7 | 80.6 | 81.7 | ||
Changes in equity [abstract] | ||||||
Balance, beginning of period | $ 1,264 | $ 1,278 | $ 1,280 | $ 1,280 | $ 1,278 | $ 1,280 |
Issue of common shares upon exercise of options | 0 | 0 | 1 | 0 | ||
Reverse accrual for shares repurchased and/or cancelled in 2019 | 0 | 24 | ||||
Shares repurchased in 2018 and cancelled in 2019 | 0 | (2) | ||||
Cancellation of treasury shares | (15) | (22) | ||||
Balance, end of period | $ 1,264 | $ 1,264 | $ 1,280 | $ 1,280 | $ 1,264 | $ 1,280 |
SHAREHOLDERS' EQUITY SHAREHOLDE
SHAREHOLDERS' EQUITY SHAREHOLDERS' EQUITY - Narrative (Details) $ in Millions | Mar. 31, 2015entity | Jul. 04, 2020USD ($)shares | Apr. 04, 2020USD ($)shares | Jul. 06, 2019USD ($) | Apr. 06, 2019USD ($)shares | Jul. 04, 2020USD ($)shares | Jul. 06, 2019USD ($)shares | Oct. 22, 2019shares | Oct. 22, 2018shares |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Number of entities | entity | 2 | ||||||||
Options granted (in shares) | shares | 0 | ||||||||
Proceeds from exercise of options | $ 1 | ||||||||
Stock options exercised | $ 1 | $ 1 | |||||||
Share capital | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Shares repurchased and cancelled in 2019 (in shares) | shares | (1,000,000) | (1,400,000) | |||||||
Cancellation of treasury shares | $ 0 | $ 0 | $ (15) | $ (24) | |||||
Number of shares purchased and accrued for in prior year and cancelled in current year (in shares) | shares | 0 | (200,000) | |||||||
Number of share options exercised in share-based payment arrangement (in shares) | shares | 100,000 | 0 | |||||||
Retained earnings | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Cancellation of treasury shares | $ 0 | $ 0 | $ (7) | $ (19) | |||||
Employee Stock Option | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Options granted (in shares) | 0 | ||||||||
Share-based payments | $ 1 | ||||||||
Automatic Share Purchase Plan | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Shares repurchased and cancelled in 2019 (in shares) | shares | 100,000 | 1,400,000 | (900,000) | ||||||
Cancellation of treasury shares | $ 2 | $ 39 | $ 20 | ||||||
Number of shares purchased and accrued for in prior year and cancelled in current year (in shares) | shares | 200,000 | ||||||||
Purchase of treasury shares | $ 4 | ||||||||
Automatic Share Purchase Plan | Share capital | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Cancellation of treasury shares | 1 | 22 | (14) | ||||||
Purchase of treasury shares | 2 | ||||||||
Automatic Share Purchase Plan | Retained earnings | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Cancellation of treasury shares | $ 1 | 17 | $ 6 | ||||||
Purchase of treasury shares | $ (2) | ||||||||
Normal Course Issuer Bid Program | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Repurchase program, authorized amount | shares | 5,191,965 | ||||||||
Percentage ownership | 10.00% | ||||||||
Normal Course Issuer Bid Program | Share capital | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Common shares (in shares) | shares | 81,668,583 | 51,919,654 | |||||||
Maximum | Normal Course Issuer Bid Program | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Repurchase program, authorized amount | shares | 4,083,429 | ||||||||
Percentage ownership | 5.00% | ||||||||
Maximum per day | Normal Course Issuer Bid Program | |||||||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||||||
Repurchase program, authorized amount | shares | 145,940 | 145,940 | 72,970 | 79,704 |
SHAREHOLDERS' EQUITY - Accumula
SHAREHOLDERS' EQUITY - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||||
Jul. 04, 2020 | Dec. 31, 2019 | Apr. 04, 2020 | Jul. 06, 2019 | Apr. 06, 2019 | Dec. 31, 2018 | |
Disclosure of analysis of other comprehensive income by item [line items] | ||||||
Accumulated other comprehensive loss, net of tax | $ 686 | $ 704 | $ 749 | |||
Accumulated other comprehensive loss | ||||||
Disclosure of analysis of other comprehensive income by item [line items] | ||||||
Foreign currency translation loss on investment in foreign operations, net of tax of $(3) (December 31, 2015 – $(10)) | (164) | (145) | ||||
Net loss on hedge of net investment in foreign operations, net of tax of $3 (December 31, 2015 – $3) | (8) | (8) | ||||
Actuarial loss on defined benefit pension obligation, net of tax | (31) | (30) | ||||
Accumulated other comprehensive loss, net of tax | (203) | (183) | $ (208) | $ (208) | $ (192) | $ (197) |
Tax | (3) | (4) | ||||
Income tax relating to hedges of net investments in foreign operations | 3 | 3 | ||||
Income tax relating to actuarial loss on defined benefit pension obligation | $ 10 | $ 9 |
SHAREHOLDERS' EQUITY Repurchase
SHAREHOLDERS' EQUITY Repurchase Agreement (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jul. 04, 2020 | Apr. 04, 2020 | Jul. 06, 2019 | Apr. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Automatic Share Purchase Plan | ||||||
Disclosure of classes of share capital [line items] | ||||||
Shares repurchased and cancelled in 2019 (in shares) | 0.1 | 1.4 | (0.9) | |||
Cancellation of treasury shares | $ 2 | $ 39 | $ 20 | |||
Share capital | ||||||
Disclosure of classes of share capital [line items] | ||||||
Shares repurchased and cancelled in 2019 (in shares) | (1) | (1.4) | ||||
Cancellation of treasury shares | $ 0 | $ 0 | $ (15) | $ (24) | ||
Share capital | Automatic Share Purchase Plan | ||||||
Disclosure of classes of share capital [line items] | ||||||
Cancellation of treasury shares | 1 | 22 | (14) | |||
Retained deficit | ||||||
Disclosure of classes of share capital [line items] | ||||||
Cancellation of treasury shares | $ 0 | $ 0 | (7) | $ (19) | ||
Retained deficit | Automatic Share Purchase Plan | ||||||
Disclosure of classes of share capital [line items] | ||||||
Cancellation of treasury shares | $ 1 | $ 17 | $ 6 |
IMPAIRMENT OF ASSETS (Details)
IMPAIRMENT OF ASSETS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Disclosure of impairment of assets [Abstract] | ||||
Impairment loss | $ 16 | $ 0 | $ 16 | $ 0 |
INCOME TAX - Income Tax Compone
INCOME TAX - Income Tax Components (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Income Taxes [Abstract] | ||||
Current income tax (expense) recovery | $ (27) | $ 21 | $ (4) | $ 47 |
Deferred income tax recovery (expense) | 24 | (11) | (7) | (32) |
Income tax expense | $ (3) | $ 10 | $ (11) | $ 15 |
EARNINGS PER COMMON SHARE (Deta
EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Earnings per share [abstract] | ||||
Earnings (loss) available to common shareholders | $ 18 | $ (14) | $ 38 | $ (13) |
Common shares (millions): | ||||
Weighted average number of common shares outstanding | 80.6 | 81.7 | 81.1 | 81.9 |
Dilutive stock options (in shares) | 0.1 | 0 | 0 | 0 |
Diluted number of common shares | 80.7 | 81.7 | 81.1 | 81.9 |
Basic and diluted (in dollars per share) | $ 0.22 | $ (0.17) | $ 0.47 | $ (0.16) |
EARNINGS PER COMMON SHARE - Nar
EARNINGS PER COMMON SHARE - Narrative (Details) | 3 Months Ended | 6 Months Ended | |
Jul. 04, 2020 | Jul. 04, 2020 | Jul. 06, 2019 | |
Earnings per share [abstract] | |||
Description of instruments with potential future dilutive effect not included in calculation of diluted earnings per share | 1500000 | 1100000 | 0.7 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION - Other Items (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Cash Flow Statement [Abstract] | ||||
Stock-based compensation | $ 3 | $ 1 | $ 3 | $ 2 |
Pension funding (greater) less than expense | (1) | (1) | (1) | (2) |
Cash interest paid less than interest expense | 0 | (8) | (1) | 1 |
Amortization of debt issue costs | 1 | 0 | 1 | 1 |
Unrealized loss on outstanding currency forwards | 0 | (3) | 0 | 0 |
Unrealized foreign exchange loss on translation of monetary balances | 1 | 0 | 6 | 4 |
Other | 0 | 0 | 0 | 1 |
Other items | $ 4 | $ (11) | $ 8 | $ 7 |
SUPPLEMENTAL CASH FLOW INFORM_4
SUPPLEMENTAL CASH FLOW INFORMATION - Net Change in Non-Cash Working Capital (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Cash (used for) provided by: | ||||
Accounts receivable | $ 7 | $ 37 | $ (9) | $ 8 |
Prepaids | 2 | (2) | 5 | 0 |
Inventory | 43 | 25 | 16 | (14) |
Accounts payable and accrued liabilities | (6) | (21) | (35) | (66) |
Increase (decrease) in working capital | 46 | 39 | (23) | (72) |
Cash interest paid | (11) | (19) | (24) | (20) |
Cash interest received | 0 | 0 | 0 | 1 |
Cash income taxes paid | 0 | (16) | (1) | (66) |
Cash income taxes received | $ 3 | $ 0 | $ 45 | $ 15 |
SUPPLEMENTAL CASH FLOW INFORM_5
SUPPLEMENTAL CASH FLOW INFORMATION - Net Change in Financial Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Cash Flow Statement [Abstract] | ||||
Long-term debt | $ 0 | $ 346 | $ 0 | $ 346 |
Other long-term debt | (95) | 2 | (68) | 82 |
Increase through new leases, liabilities arising from financing activities | (20) | 0 | 0 | 0 |
Net (decrease) increase in financial liabilities | $ (115) | $ 348 | $ (68) | $ 428 |
SUPPLEMENTAL CASH FLOW INFORM_6
SUPPLEMENTAL CASH FLOW INFORMATION - Cash and Non-Cash Movements in Financial Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | |
Cash movements: | ||||
Accounts receivable securitization (repayments) drawings | $ (95) | $ 2 | $ (68) | $ 82 |
Revolving bank lines repayments | (20) | 0 | 0 | 0 |
Issuance of debt | 0 | 350 | 0 | 350 |
Debt issuance costs | (1) | (4) | (1) | (4) |
Cash movements | (116) | 348 | (69) | 428 |
Non-cash movements: | ||||
Amortization of debt issue costs | 1 | 0 | 1 | 1 |
Interest expense | 1 | 0 | 1 | 0 |
Debt Issuance Costs Incurred During Noncash Or Partial Noncash Transaction1 | 0 | 0 | 0 | 1 |
Net (decrease) increase in financial liabilities | $ (115) | $ 348 | $ (68) | $ 428 |
FINANCIAL INSTRUMENTS - Book an
FINANCIAL INSTRUMENTS - Book and Fair Values of Financial Instruments (Details) - USD ($) $ in Millions | Jul. 04, 2020 | Dec. 31, 2019 |
Disclosure of financial assets [line items] | ||
Allowance account for credit losses of financial assets | $ 1 | $ 1 |
Net Book Value | 159 | 157 |
Fair Value | 159 | 157 |
Disclosure of financial liabilities [line items] | ||
Net Book Value | 875 | 1,004 |
Fair Value | 900 | 1,041 |
Accounts payable and accrued liabilities | Amortised cost | ||
Disclosure of financial liabilities [line items] | ||
Net Book Value | 201 | 259 |
Fair Value | 201 | 259 |
Long-term debt | Amortised cost | ||
Disclosure of financial liabilities [line items] | ||
Net Book Value | 665 | 665 |
Fair Value | 690 | 702 |
Other long-term debt | Amortised cost | ||
Disclosure of financial liabilities [line items] | ||
Net Book Value | 0 | 68 |
Fair Value | 0 | 68 |
Other liabilities | Amortised cost | ||
Disclosure of financial liabilities [line items] | ||
Net Book Value | 9 | 12 |
Fair Value | 9 | 12 |
Cash and cash equivalents | Fair value through profit or loss | ||
Disclosure of financial assets [line items] | ||
Net Book Value | 20 | 20 |
Fair Value | 20 | 20 |
Accounts receivable | Amortised cost | ||
Disclosure of financial assets [line items] | ||
Net Book Value | 137 | 136 |
Fair Value | 137 | 136 |
Other assets(1) | Amortised cost | ||
Disclosure of financial assets [line items] | ||
Net Book Value | 2 | 1 |
Fair Value | $ 2 | $ 1 |
FINANCIAL INSTRUMENTS - Narrati
FINANCIAL INSTRUMENTS - Narrative (Details) $ in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Jul. 04, 2020USD ($) | Jul. 06, 2019USD ($) | Jul. 04, 2020USD ($) | Jul. 06, 2019USD ($) | Jul. 04, 2020EUR (€) | Jul. 04, 2020CAD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2019CAD ($) | |
Disclosure of detailed information about hedging instruments [line items] | |||||||||
Debt issue costs | $ 8 | $ 8 | $ 8 | ||||||
Unrealized gain (loss) on derivatives | 0 | 0 | (1) | ||||||
Foreign Currency Forward Contracts | Cash flow hedges | |||||||||
Disclosure of detailed information about hedging instruments [line items] | |||||||||
Notional amount | $ 2 | $ 52 | |||||||
Unrealized gain (loss) on derivatives | 1 | 1 | 1 | ||||||
Gains (losses) on financial assets at fair value through profit or loss | 1 | $ 1 | 2 | $ 1 | |||||
Foreign Currency Options | Cash flow hedges | |||||||||
Disclosure of detailed information about hedging instruments [line items] | |||||||||
Notional amount | € | € 0 | € 30,000,000 | |||||||
Unrealized gain (loss) on derivatives | 0 | 0 | $ 1 | ||||||
Gains (losses) on financial assets at fair value through profit or loss | $ 0 | $ 1 | $ 1 | $ 1 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | Jul. 04, 2020USD ($) |
Disclosure of contingent liabilities [line items] | |
Purchase commitments | $ 95 |
Gross lease liabilities | 22 |
Reforestation obligation | 4 |
Non-derivative financial liabilities, undiscounted cash flows | 121 |
Less than 1 Year | |
Disclosure of contingent liabilities [line items] | |
Purchase commitments | 26 |
Gross lease liabilities | 8 |
Reforestation obligation | 1 |
Non-derivative financial liabilities, undiscounted cash flows | 35 |
1–5 Years | |
Disclosure of contingent liabilities [line items] | |
Purchase commitments | 30 |
Gross lease liabilities | 10 |
Reforestation obligation | 2 |
Non-derivative financial liabilities, undiscounted cash flows | 42 |
Thereafter | |
Disclosure of contingent liabilities [line items] | |
Purchase commitments | 39 |
Gross lease liabilities | 4 |
Reforestation obligation | 1 |
Non-derivative financial liabilities, undiscounted cash flows | $ 44 |
RELATED PARTY TRANSACTIONS - Na
RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | Dec. 31, 2019 | |
Disclosure of transactions between related parties [line items] | |||||
Revenue from sale from related party transactions | $ 15 | $ 28 | |||
Brookfield | |||||
Disclosure of transactions between related parties [line items] | |||||
Services received from related party transactions | 1 | $ 1 | |||
Interex Forest Products Ltd. | |||||
Disclosure of transactions between related parties [line items] | |||||
Proportion of ownership interest in associate | 25.00% | ||||
Revenue from sale from related party transactions | $ 17 | $ 35 | |||
Amounts receivable from related party transactions | 2 | 2 | $ 4 | ||
Investments accounted for using equity method, less than | $ 1 | $ 1 | $ 1 |
GEOGRAPHIC SEGMENTS (Details)
GEOGRAPHIC SEGMENTS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 04, 2020 | Jul. 06, 2019 | Jul. 04, 2020 | Jul. 06, 2019 | Dec. 31, 2019 | |
Disclosure of operating segments [line items] | |||||
Sales | $ 421 | $ 447 | $ 888 | $ 923 | |
EBITDA | 63 | 32 | 138 | 73 | |
Depreciation and amortization | 32 | 34 | 67 | 69 | |
Additions to property, plant and equipment | 13 | 29 | 37 | 59 | |
Property, plant and equipment | 1,367 | 1,367 | $ 1,427 | ||
Operating segments | North America | |||||
Disclosure of operating segments [line items] | |||||
Sales | 330 | 317 | 676 | 647 | |
EBITDA | 65 | 15 | 133 | 38 | |
Depreciation and amortization | 26 | 28 | 55 | 56 | |
Additions to property, plant and equipment | 10 | 19 | 23 | 44 | |
Property, plant and equipment | 1,099 | 1,099 | 1,147 | ||
Operating segments | Europe | |||||
Disclosure of operating segments [line items] | |||||
Sales | 91 | 130 | 212 | 276 | |
EBITDA | 2 | 21 | 12 | 42 | |
Depreciation and amortization | 6 | 6 | 12 | 13 | |
Additions to property, plant and equipment | 3 | 10 | 14 | 15 | |
Property, plant and equipment | 268 | 268 | 280 | ||
Unallocated | |||||
Disclosure of operating segments [line items] | |||||
Sales | 0 | 0 | 0 | 0 | |
EBITDA | (4) | (4) | (7) | (7) | |
Depreciation and amortization | 0 | 0 | 0 | 0 | |
Additions to property, plant and equipment | 0 | $ 0 | 0 | $ 0 | |
Property, plant and equipment | $ 0 | $ 0 | $ 0 |