Canfor Pulp Products Inc. (“The Company” or “CPPI”) (TSX: CFX) today reported its second quarter of 2024 results:
Overview
- Q2 2024 operating loss of $5.6 million; net loss of $6.3 million, or $0.10 per share.
- Strong global pulp pricing and moderate improvement in NBSK pulp unit sales realizations.
- Intercon NBSK pulp mill scheduled maintenance downtime completed as planned; restart delayed due to unforeseen recovery boiler repairs and start up challenges.
- Announced indefinite curtailment of one production line at Northwood NBSK pulp mill, driven by the decline in availability of economic fibre in the northern British Columbia region.
The Company reported an operating loss of $5.6 million for the second quarter of 2024, compared to an operating loss of $15.7 million for the first quarter of 2024. These results largely reflected an uplift in global pulp pricing, primarily in response to global pulp supply disruptions, and the correlated improvement in the Company’s average Northern Bleached
Softwood Kraft (“NBSK”) pulp sales unit realizations. These factors were offset in part, however, by a decline in the Company’s pulp production and shipments quarter-over-quarter, driven by extended downtime at its Intercontinental NBSK pulp mill (“Intercon”) to address unforeseen recovery boiler repairs identified during the scheduled maintenance in May.
In May 2024, the Company announced the decision to indefinitely curtail one production line at its Northwood NBSK pulp mill (“Northwood”) as a result of the continual decline in the availability of economic fibre in the northern British Columbia (“BC”) region. The Company anticipates winding down this production line in August 2024. In connection with this indefinite curtailment, CPPI recognized restructuring costs of $5.9 million during the current quarter.
Commenting on the Company’s second quarter of 2024 results, CPPI’s President and Chief Executive Officer, Kevin Edgson, said, “While our pulp business benefited from strong global pulp pricing this quarter, operationally, unanticipated downtime at our Intercon pulp mill limited our ability to take full advantage of this higher pricing environment and moderated our second quarter results. The decision to indefinitely curtail one line at our Northwood NBSK pulp mill was extremely difficult, however, necessary given the continuing fibre cost pressures and a difficult outlook for availability of economic residual fibre in BC. We regret the impact these decisions have on our employees, their families and the local community, and are working to support our employees through this transition. As we prepare for an orderly wind-down in August, we would like to thank our employees for their unwavering commitment and perseverance.”
Source: Canfor Pulp
