Canfor Corporation (“The Company” or “Canfor”) (TSX: CFP) today reported its second quarter of 2023 results:
- Q2 2023 operating loss of $67 million including a $57 million reversal of a previously recognized inventory write-down; adjusted operating loss of $124 million; adjusted shareholder net loss of $44 million, or $0.36 per share
- Strong earnings continued at the Company’s European and US South operations with persistent challenges in British Columbia
- Sustained pressure on global lumber market fundamentals and pricing, particularly in North America
- Increased North American lumber production & shipments despite ongoing curtailments in British Columbia and permanent closure of Chetwynd facilities and temporary closure of Houston sawmill
- Significant deterioration in global pulp market fundamentals; closure of the pulp line at Prince George Pulp and Paper Mill; subsequent to quarter-end, short curtailment of Northwood NBSK pulp mill amidst British Columbia port strike
The Company reported an operating loss of $66.7 million for the second quarter of 2023, compared to an operating loss of $208.5 million in the first quarter of 2023. After taking into consideration a net $57.4 million reversal of a previously recognized inventory write-down, the Company’s adjusted operating loss was $124.1 million for the second quarter of 2023, compared to an adjusted operating loss of $146.4 million for the first quarter of 2023. These results were driven by improved lumber segment earnings, offset in part by a decline in pulp and paper segment results.
Commenting on the Company’s second quarter results, Canfor’s President and Chief Executive Officer, Don Kayne, said, “Despite the continued pressure on global lumber markets throughout the quarter, we remain committed to our long-term strategy, as our lumber results once again reflected the advantages of our global diversification strategy. Our European and US South operations results were strong and improved quarter-over-quarter. This helped partially offset the results from our Western Canadian lumber business, especially our British Columbian operations, that continued to face challenges due to persistent weak Western Spruce/Pine/Fir market conditions. Also, in this quarter, we completed the permanent closure of our Chetwynd facilities and the temporary closure of our Houston sawmill. Both wind downs were completed safely, and we thank our employees for the grace and resilience they have demonstrated during this difficult period. For the pulp business, this quarter was a difficult period, as declining global pulp market conditions weighed heavily on results.”
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