October 30, 2009 / 9:47 PM / in 9 years

UPDATE 1-Canada's SFK Pulp posts Q3 loss, says to cut costs

* Q3 sales fall 18 pct to C$112.8 mln

* Says weak RBK pulp market to continue

Oct 30 (Reuters) - Canada’s SFK Pulp Fund SFK_u.TO on Friday reported a quarterly loss hurt by weaker pricing and lower sales of its recycled bleached kraft pulp (RBK).

The company said it plans to reduce labor costs by 10 percent with expected savings from 2010, which could impact its employees. However, it did not disclose further details.

Domestic RBK pulp demand is still impacted by lower demand for printing and writing papers, SFK said in a statement.

“We do not expect major changes in RBK pulp market conditions with possibly other U.S. programs being introduced in 2010 to replace the current black liquor tax credit which expires at the end of the year,” SFK said in a statement.

For the latest third quarter, the fund reported a loss of C$14.5 million, or 16 Canadian cents a unit, compared with a profit of C$8.7 million, or 8 Canadian cents a unit, a year ago.

Sales were down about 18 percent at C$112.8 million.

Analysts on average had expected a loss of 5 cents a unit, on revenue of C$107 million, according to Thomson Reuters I/B/E/S.

Units of the fund closed at 83 Canadian cents Friday on the Toronto Stock Exchange. (Reporting by Ashutosh Joshi in Bangalore; Editing by Gopakumar Warrier)

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