FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _______ TO _______
COMMISSION FILE NO.: 000-09409
MERCER INTERNATIONAL INC.
(Exact name of Registrant as specified in its charter)
WASHINGTON 91-6087550
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
GIESSHUBELSTRASSE 15, ZURICH, SWITZERLAND CH 8045
(Address of principal executive offices) (Zip Code)
41(1) 201 7710
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES X NO
---- ----
The Registrant had 16,794,899 shares of beneficial interest outstanding as at
May 14, 2001.
PART I. FINANCIAL INFORMATION
---------------------
ITEM 1. FINANCIAL STATEMENTS
MERCER INTERNATIONAL INC.
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2001
(UNAUDITED)
MERCER INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
AS AT MARCH 31, 2001 AND DECEMBER 31, 2000
(UNAUDITED)
(DOLLARS IN THOUSANDS)
MARCH 31, DECEMBER 31,
2001 2000
----------- --------------
ASSETS
Current Assets
Cash and cash equivalents $ 12,417 $ 18,496
Investments 5,735 5,320
Receivables 37,623 46,088
Inventories 20,158 19,977
Prepaid and other 2,624 3,000
----------- --------------
Total current assets 78,557 92,881
Long-Term Assets
Cash restricted 21,652 25,150
Properties 244,797 265,607
Investments 6,334 6,101
Notes receivable 4,296 4,296
Deferred income tax 9,070 9,624
----------- --------------
286,149 310,778
----------- --------------
$ 364,706 $ 403,659
=========== ==============
LIABILITIES
Current Liabilities
Accounts payable and accrued
expenses $ 37,186 $ 37,058
Pulp mill renovation costs payable 181 1,146
Note payable 584 839
Debt 10,786 27,173
----------- --------------
Total current liabilities 48,737 66,216
Long-Term Liabilities
Debt 189,783 208,315
Other 3,129 3,721
----------- --------------
192,912 212,036
----------- --------------
Total liabilities 241,649 278,252
SHAREHOLDERS' EQUITY
Shares of beneficial interest 99,995 99,995
Retained earnings 93,273 88,698
Accumulated other comprehensive loss (70,211) (63,286)
----------- --------------
123,057 125,407
----------- --------------
$ 364,706 $ 403,659
=========== ==============
The accompanying notes are an integral part of these financial statements.
MERCER INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT FOR EARNINGS PER SHARE)
2001 2000
------- --------
Revenues
Sales $52,366 $55,243
Other 3,630 517
------- --------
55,996 55,760
Expenses
Cost of sales 41,977 48,892
General and administrative 5,900 1,688
Interest expense 3,544 4,132
------- --------
51,421 54,712
------- --------
Income before income taxes 4,575 1,048
Income taxes (recovery) - (23)
------- --------
Net income 4,575 1,071
Retained earnings, beginning of period 88,698 59,224
------- --------
Retained earnings, end of period $93,273 $60,295
======= ========
Earnings per share
Basic $ 0.27 $ 0.06
======= ========
Diluted $ 0.27 $ 0.06
======= ========
The accompanying notes are an integral part of these financial statements.
MERCER INTERNATIONAL INC.
STATEMENTS OF COMPREHENSIVE INCOME
FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
(UNAUDITED)
(DOLLARS IN THOUSANDS)
2001 2000
-------- --------
Net income $ 4,575 $ 1,071
Other comprehensive income (loss):
Foreign currency translation adjustments (7,968) (5,852)
Unrealized gain (loss) on securities 1,043 (15)
-------- --------
Other comprehensive loss (6,925) (5,867)
-------- --------
Total comprehensive loss $(2,350) $(4,796)
======== ========
The accompanying notes are an integral part of these financial statements.
MERCER INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THREE MONTHS ENDED MARCH 31, 2001 AND 2000
(UNAUDITED)
(DOLLARS IN THOUSANDS)
2001 2000
--------- ---------
Cash Flows from Operating Activities:
Net income $ 4,575 $ 1,071
Adjustments to reconcile net income from
operations to cash
Depreciation and amortization 5,346 6,690
Changes in current assets and liabilities
Investments (771) 181
Inventories (1,534) 2,184
Receivables 6,545 4,124
Accounts payable and accrued expenses 2,152 3,136
Other 187 (74)
--------- ---------
Net cash provided by operating activities 16,500 17,312
Cash Flows from Investing Activities:
Purchase of fixed assets, net of investment grants (1,407) 18,682
--------- ---------
Net cash (used in) provided by investing activities (1,407) 18,682
Cash Flows from Financing Activities:
Cash restricted 1,976 -
Increase in indebtedness - 6,053
Decrease in indebtedness (21,271) (3)
Decrease in pulp mill conversion costs payable (934) (25,750)
--------- ---------
Net cash used in financing activities (20,229) (19,700)
Effect of exchange rate changes on cash and
cash equivalents (943) (1,343)
--------- ---------
Net (decrease) increase in cash and cash equivalents (6,079) 14,951
Cash and cash equivalents, beginning of period 18,496 1,722
--------- ---------
Cash and cash equivalents, end of period $ 12,417 $ 16,673
========= =========
The accompanying notes are an integral part of these financial statements.
MERCER INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THREE MONTHS ENDED MARCH 31, 2001
(UNAUDITED)
NOTE 1. BASIS OF PRESENTATION
The interim period consolidated financial statements contained herein include
the accounts of Mercer International Inc. and its subsidiaries (the "Company").
The interim period consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the U.S. Securities and
Exchange Commission (the "SEC"). Certain information and footnote disclosure
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
SEC rules and regulations. The interim period consolidated financial statements
should be read together with the audited consolidated financial statements and
accompanying notes included in the Company's latest annual report on Form 10-K
for the fiscal year ended December 31, 2000. In the opinion of the Company, the
unaudited consolidated financial statements contained herein contain all
adjustments necessary to present a fair statement of the results of the interim
periods presented.
NOTE 2. EARNINGS PER SHARE
Basic earnings per share is computed by dividing income available to common
shareholders by the weighted average number of shares outstanding during a
period. Diluted earnings per share takes into consideration shares outstanding
(computed under basic earnings per share) and potentially dilutive shares. The
weighted average number of shares outstanding for the purposes of calculating
basic earnings per share was 16,874,899 and 16,715,399 for the three months
ended March 31, 2001 and 2000, respectively. The weighted average number of
shares outstanding for the purposes of calculating diluted earnings per share
was 17,218,749 and 16,992,883 for the three months ended March 31, 2001 and
2000, respectively.
NOTE 3. ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities", established accounting and
reporting standards for derivative instruments and hedging activities. SFAS No.
133 was amended by SFAS No. 137, "Accounting for Derivative Instruments and
Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133",
which deferred the implementation date of SFAS 133 to fiscal years beginning
after June 15, 2000. Retroactive application is prohibited.
The Company adopts SFAS No. 133 effective from January 1, 2001. All derivative
instruments are measured at fair value and reported in the balance sheet as
assets or liabilities. Accounting for gains and losses depends on the intended
use of the derivative instrument. Gains and losses on derivative instruments not
designated as hedging instruments are recognized in earnings in the period of
the change in fair value. Accounting for gains and losses on derivative
instruments designated as hedging instruments depends on the type of hedge, and
such gains and losses are recognized in either earnings or other comprehensive
income.
NOTE 4. BUSINESS SEGMENT INFORMATION
The Company operates in two reportable business segments: pulp and paper. The
segments are managed separately because each business requires different
production and marketing strategies.
Summarized financial information concerning the segments is shown in the
following table:
PULP PAPER TOTAL
-------- ------- -------
THREE MONTHS ENDED MARCH 31, 2001
Sales to external customers. . . . . . . . . . $36,591 $15,775 $52,366
Intersegment net sales . . . . . . . . . . . . 1,702 - 1,702
Segment profit . . . . . . . . . . . . . . . . 5,513 69 5,582
Reconciliation of profit:
Total profit for reportable segments. . . . . $ 5,582
Elimination of intersegment profits . . . . . 269
Unallocated amounts, other corporate expenses (1,276)
-------
Consolidated income before income taxes . . $ 4,575
=======
THREE MONTHS ENDED MARCH 31, 2000
Sales to external customers. . . . . . . . . . $32,286 $22,957 $55,243
Intersegment net sales . . . . . . . . . . . . 133 - 133
Segment profit . . . . . . . . . . . . . . . . 898 1,165 2,063
Reconciliation of profit:
Total profit for reportable segments. . . . . $ 2,063
Elimination of intersegment profits . . . . . -
Unallocated amounts, other corporate expenses (1,015)
-------
Consolidated income before income taxes . . $ 1,048
=======
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Mercer International Inc. is a pulp and paper company and its operations are
primarily located in Germany. The following discussion and analysis of the
results of operations and financial condition of the Company for the three
months ended March 31, 2001 should be read in conjunction with the consolidated
financial statements and related notes included elsewhere herein. In this
document: (i) unless the context otherwise requires, the "Company" refers to
Mercer International Inc. and its subsidiaries; and (ii) a "tonne" is one metric
ton or 2,204.6 pounds.
Based upon period average exchange rates, the U.S. dollar appreciated by
approximately 7.0% against the deutschmark in the three months ended March 31,
2001, compared to the same period of 2000.
RESULTS OF OPERATIONS - THREE MONTHS ENDED MARCH 31, 2001
The following table sets forth selected sales data for the Company for the
periods indicated:
THREE MONTHS ENDED MARCH 31,
------------------------------
2001 2000
--------- --------
(UNAUDITED)
(IN THOUSANDS)
SALES BY PRODUCT CLASS
Packaging papers(1) $ - $ 5,205
Specialty papers 9,797 8,495
Printing papers(2) 5,978 9,257
Pulp 36,591 32,286
--------- --------
Total(3) $ 52,366 $ 55,243
========= ========
SALES BY GEOGRAPHIC AREA
Germany $ 26,328 $ 22,799
European Union(4) 16,939 19,467
Eastern Europe and other 9,099 12,977
--------- --------
Total(3) $ 52,366 $ 55,243
========= ========
SALES BY VOLUME (TONNES)
Packaging papers(1) - 17,717
Specialty papers 11,044 10,658
Printing papers(2) 7,049 13,489
Pulp 61,742 58,311
--------- --------
Total(3) 79,835 100,175
========= ========
(1) The Company sold its packaging paper mill in Trebsen, Germany effective
June 2000.
(2) The Company sold its printing paper mill in Hainsberg, Germany effective
November 2000.
(3) Excluding intercompany sales.
(4) Not including Germany.
In the three months ended March 31, 2001, revenues increased by approximately
0.4% to $56.0 million from $55.8 million in the three months ended March 31,
2000, primarily as a result of higher pulp sales in the current period. The
increase in revenues in the current period was partially offset by lower paper
sales. In the three months ended March 31, 2001, pulp and paper revenues
decreased by approximately 5.2% from the comparable period of 2000, on a 13.3%
increase in pulp sales and a 31.3% decrease in paper sales.
Pulp sales in the three months ended March 31, 2001 increased to $36.6 million
from $32.3 million in the comparable period of 2000. The Company completed a
project in late 1999 to convert the Company's pulp mill to the production of
kraft pulp and increase its annual production capacity to 280,000 tonnes (the
"Conversion Project"). The pulp mill ramped up production in early 2000 and has
operated in excess of 90% of capacity since the beginning of the second quarter
of 2000. List prices for kraft pulp in Europe decreased from approximately $710
per tonne at the end of 2000 to approximately $650 per tonne during the first
quarter of 2001 and approximately $600 per tonne during April 2001.
Paper sales in the three months ended March 31, 2001 decreased to $15.8 million
from $23.0 million in the comparable period of 2000. Sales of specialty papers
increased in the three months ended March 31, 2001 compared to the three months
ended March 31, 2000 as a result of increased sales prices, while sales of
printing papers declined as a result of the sale of the Company's recycled
printing paper mill in Hainsberg, Germany effective November 2000. The Company
did not sell any packaging papers during the first quarter of 2001 as a result
of the sale of its packaging paper mill in Trebsen, Germany effective June 2000,
compared to $5.2 million during the first quarter of 2000. On average, paper
prices realized by the Company in the three months ended March 31, 2001
increased by approximately 59% compared to the same period in 2000, with higher
prices for both specialty and printing papers.
Expenses decreased to $51.4 million in the three months ended March 31, 2001
from $54.7 million in the comparable period of 2000, primarily as a result of an
improvement in pulp production efficiency due to the ramping-up of pulp
production in early 2000 and a decrease in the production of paper products as a
result of the sale of two of the Company's paper mills in 2000. On average, the
Company's unit fibre costs for pulp production in the three months ended March
31, 2001 increased by approximately 14% compared to the same period in 2000.
Prices for waste paper, which currently comprises approximately 25% of the fibre
for the Company's paper mills, also increased in the three months ended March
31, 2001, compared to the same period of 2000.
General and administrative expenses were $5.9 million in the three months ended
March 31, 2001, compared to $5.7 million in the three months ended December 31,
2000 and $1.7 million in the three months ended March 31, 2000. Interest
expense in the three months ended March 31, 2001 decreased to $3.5 million from
$4.1 million in the comparable period of 2000, primarily as a result of lower
indebtedness during the quarter and a continuing depreciation of the deutschmark
relative to the U.S. dollar.
For the three months ended March 31, 2001, the Company reported net income of
$4.6 million, or $0.27 per share, compared to net income of $1.1 million, or
$0.06 per share, in the comparable period of 2000.
LIQUIDITY AND CAPITAL RESOURCES
The following table is a summary of selected financial information concerning
the Company for the periods indicated:
AS AT AS AT
MARCH 31, 2001 DECEMBER 31, 2000
---------------- ------------------
(UNAUDITED)
(IN THOUSANDS)
FINANCIAL POSITION
Working capital . . . . . . . . . . $ 29,820 $ 26,665
Property, plant and equipment (net) 244,797 265,607
Total assets. . . . . . . . . . . . 364,706 403,659
Long-term debt. . . . . . . . . . . 189,783 208,315
Shareholders' equity. . . . . . . . 123,057 125,407
At March 31, 2001, the Company's cash and cash equivalents totalled $12.4
million, a net decrease of $6.1 million from $18.5 million at December 31, 2000.
At March 31, 2001, the Company had short-term trading securities totalling $5.7
million, compared to $5.3 million at December 31, 2000.
OPERATING ACTIVITIES
Operating activities provided cash of $16.5 million in the three months ended
March 31, 2001, compared to $17.3 million in the same period in 2000. A
decrease in receivables provided cash of $6.5 million in the current period,
compared to $4.1 million in the comparative period of 2000. An increase in
accounts payable and accrued expenses provided cash of $2.2 million in the three
months ended March 31, 2001, compared to $3.1 million in the three months ended
March 31, 2000. Higher inventories used cash of $1.5 million in the three
months ended March 31, 2001, compared to lower inventories providing cash of
$2.2 million in the three months ended March 31, 2000. Net purchases of
investment securities used cash of $0.8 million in the three months ended March
31, 2001, compared to net sales of investment securities providing cash of $0.2
million in the comparative period of 2000.
INVESTING ACTIVITIES
Investing activities in the three months ended March 31, 2001 used cash of $1.4
million, consisting of capital expenditures on properties, compared to providing
cash of $18.7 million in the three months ended March 31, 2000.
The Company completed the Conversion Project in late 1999. The Conversion
Project was financed through a combination of borrowings under a project loan,
non-refundable governmental grants, governmental assistance and guarantees for
long-term project financing and an equity investment by the Company.
The Company is continuing to review its paper operations to define a long-term
core competency in respect of products produced in order that future investment
may be directed towards that segment.
FINANCING ACTIVITIES
Financing activities used cash of $20.2 million in the three months ended March
31, 2001, primarily as a result of a decrease in indebtedness relating to the
Conversion Project. Financing activities used cash of $19.7 million in the
three months ended March 31, 2000.
The depreciation of the deutschmark against the U.S. dollar in the three months
ended March 31, 2001 resulted in an unrealized foreign exchange translation loss
of $0.9 million on cash and cash equivalents, which is included in the Company's
statement of comprehensive income and does not affect the Company's net
earnings. See "Foreign Currency".
Effective January 2000, the Company agreed, subject to certain conditions, to
acquire a controlling interest in a "greenfield" project to construct and
operate a 550,000-tonne softwood kraft pulp mill to be located at Stendal,
Germany (the "Stendal Project"). In 2001, the Company agreed to increase its
ultimate ownership position in the Stendal Project to 57.5%. The Company's
participation in the Stendal Project is subject to, among other things,
completion of due diligence and the Stendal Project itself is subject to, among
other things, financing. The Stendal Project is currently estimated to cost
approximately DM 1,600.0 million (or $823.3 million) and to be completed in
2004. Financing for the Stendal Project is expected to come from the project
partners, government financing, project financing and outside capital. See
"Stendal Pulp Mill Project Uncertainties".
Other than the agreement relating to the Stendal Project, the Company had no
material commitments to acquire assets or operating businesses as at March 31,
2001. The Company anticipates that there will be acquisitions of businesses or
commitments to projects in the future. To achieve its long-term goals of
expanding its asset and earnings base through mergers and acquisitions, the
Company will require substantial capital resources. The necessary resources
will be generated from cash flow from operations, cash on hand, borrowing
against its assets and/or the sale of assets.
FOREIGN CURRENCY
Substantially all of the Company's operations are conducted in international
markets and its consolidated financial results are subject to foreign currency
exchange rate fluctuations, in particular, those in Germany. The Company's pulp
and paper products are principally sold in deutschmarks and euros and
approximately 99% of the Company's revenues are denominated in deutschmarks and
euros. The value of the euro is fixed at 1.95583 deutschmarks.
The Company translates foreign assets and liabilities into U.S. dollars at the
rate of exchange on the balance sheet date. Revenues and expenses are
translated at the average rate of exchange prevailing during the period.
Unrealized gains or losses from these translations are recorded as shareholders'
equity on the Company's balance sheet and do not affect the net earnings of the
Company.
Since substantially all of the Company's revenues are received in deutschmarks
and euros, the financial position of the Company for any given period, when
reported in U.S. dollars, can be significantly affected by the exchange rates
for deutschmarks prevailing during that period. In the three months ended March
31, 2001, the depreciation of the deutschmark against the U.S. dollar resulted
in a net $8.0 million foreign exchange translation loss and, as a result, the
cumulative foreign exchange translation loss increased from $56.3 million at
December 31, 2000 to $64.3 million at March 31, 2001.
The average and period end exchange rates for the deutschmark to the U.S. dollar
for the periods indicated are as follows:
QUARTER ENDED QUARTER ENDED
MARCH 31, 2001 MARCH 31, 2000
-------------- --------------
PERIOD END PERIOD AVERAGE PERIOD END PERIOD AVERAGE
-------------- -------------- ---------- --------------
RATE OF EXCHANGE
Deutschmark 2.2248 2.1213 2.0434 1.9823
Based upon the period average exchange rate in the three months ended March 31,
2001, the U.S. dollar increased by approximately 1.9% in value against the
deutschmark since December 31, 2000.
CYCLICAL NATURE OF BUSINESS; COMPETITIVE POSITION
The pulp and paper business is cyclical in nature and markets for the Company's
principal products are characterized by periods of supply and demand imbalance,
which in turn affects product prices. The markets for pulp and paper are highly
competitive and sensitive to cyclical changes in industry capacity and in the
economy, both of which can have a significant influence on selling prices and
the earnings of the Company. Demand for pulp and paper products has
historically been determined by the level of economic growth and has been
closely tied to overall business activity. The competitive position of the
Company is influenced by the availability and quality of raw materials (fibre)
and its experience in relation to other producers with respect to inflation,
energy, transportation, labour costs and productivity.
STENDAL PULP MILL PROJECT UNCERTAINTIES
The Company's participation in the Stendal Project is subject to certain
conditions, including completion of its due diligence and entering into a
shareholders' agreement. In addition, the Stendal Project itself is subject to
various risks and uncertainties customary to large "greenfield" projects of this
nature which may result in the Stendal Project not proceeding as currently
planned, or at all, such as availability and cost of materials and labour,
construction delays, cost overruns, weather conditions, governmental
regulations, availability of adequate financing, increases in long-term interest
rates and increases in taxes and other governmental fees. The Stendal Project
will also be subject to extensive and complex regulations and environmental
compliance which may result in delays, in the project company and/or its
shareholders, including the Company, incurring substantial costs in relation
thereto or in the Stendal Project being amended or not proceeding at all.
The implementation of the Stendal Project is currently expected to commence in
the first quarter of 2002 and be completed in 2004. However, there can be no
assurance that the Stendal Project will proceed as currently planned, or at all.
FORWARD-LOOKING STATEMENTS
Statements in this report, to the extent they are not based on historical
events, constitute forward-looking statements. Forward-looking statements
include, without limitation, statements regarding the outlook for future
operations, forecasts of future costs and expenditures, the evaluation of market
conditions, the outcome of legal proceedings, the adequacy of reserves, or other
business plans. Investors are cautioned that forward-looking statements are
subject to an inherent risk that actual results may vary materially from those
described herein. Factors that may result in such variance, in addition to
those accompanying the forward-looking statements, include changes in interest
rates, commodity prices, and other economic conditions; actions by competitors;
changing weather conditions and other natural phenomena; actions by government
authorities; uncertainties associated with legal proceedings; technological
development; future decisions by management in response to changing conditions;
and misjudgments in the course of preparing forward-looking statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
The Company is exposed to market risks from changes in interest rates, foreign
currency exchange rates and equity prices which may affect its results of
operations and financial condition. The Company manages these risks through
internal risk management policies. The Company also uses derivative instruments
in regard to its exposure to interest rate, currency and pulp price risks. The
derivative instruments are not designated as hedging instruments and the purpose
of the derivative activity is speculative in nature, as management uses such
tools either to augment the Company's potential gains or to reduce the Company's
potential losses, depending on management's perception of future economic events
and developments. If any of the variety of instruments and strategies the
Company utilizes are not effective, the Company may incur losses. Many of the
Company's strategies are based on historical trading patterns and correlations.
However, these strategies may not be fully effective in all market environments
or against all types of risks. Unexpected market developments may affect the
Company's risk management strategies during this time, and unanticipated
developments could impact the Company's risk management strategies in the
future.
As at March 31, 2001, no derivative contract had been executed with respect to
pulp prices. The Company may enter into short-term forward contracts to manage
its exposure to currency and interest rate risks.
Any change in the fair value of derivative instruments is included in the
determination of earnings.
Reference is made to the Company's annual report on Form 10-K for the year ended
December 31, 2000 for additional information concerning market risk.
PART II. OTHER INFORMATION
-----------------
ITEM 1. LEGAL PROCEEDINGS
The Company is subject to routine litigation incidental to its business. The
Company does not believe that the outcome of such litigation will have a
material adverse effect on its business or financial condition.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
None.
(b) REPORTS ON FORM 8-K
The Company filed the following report on Form 8-K with respect to the indicated
items during the three months ended March 31, 2001:
Form 8-K dated January 23, 2001:
Item 5. Other Events
Item 7. Financial Statements and Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
MERCER INTERNATIONAL INC.
By: /s/ R. Ian Rigg
------------------
R. Ian Rigg
Vice President and Chief Financial Officer
Date: May 14, 2001