Asset Impairment Overshadows Catalyst Paper’s Improved Financial Results

Total liquidity was $125.9 million, down from $183.9 million in the same quarter of 2010, with increased availability under Catalyst’s amended asset-based loan facility being more than offset by reduced cash on hand. Lower cash on hand resulted primarily from payment of $18.1 million in property taxes for 2011, a $4.1 million payment for outstanding property taxes for a prior year, $5.1 million cash contribution for the closure of our U.S. sales company’s benefit pension plan and an increase in cash used to fund working capital.