Norwegian papermaker Norske Skog reported Thursday that its first-quarter net loss widened to 1.15 billion kroner ($189 million) from 1.11 billion kroner in 2009 due to sagging paper prices and growing costs, according to AP. The troubled newsprint and magazine paper manufacturer said its quarterly revenue fell 15 percent to 4.46 billion kroner ($732.9 million) from 5.26 billion kroner a year earlier. Norske Skog shares sank 3.1 percent, to 7.95 kroner ($1.31), in morning trading in Oslo. The company said slumping newsprint prices offset a slight growth in global consumption, while higher manufacturing costs, especially in its primary mills in Europe, also hurt its result. The papermaker was further hit by the closure of its Bio Bio mill in Chile after a major earthquake struck the country in February. The mill was brought back on line in late April. Norske Skog Chief Executive Officer Sven Ombudstvedt called the company's situation «very demanding» and said current paper prices are «too low to sustain profitability for manufacturers.» He warned of magazine paper price hikes later this year and new cost-cutting measures on top of those enacted in 2009, which included layoffs and mill closures. The company gave a mixed outlook for the rest of 2010. While times will remain tough for the papermaking industry, Norske Skog said it expects demand and price levels to improve somewhat in the last two quarters of the year. Norske Skog employs 5,600 people and operates 14 mills in 11 countries.
