Vancouver, BC - Canfor Corporation (TSX: CFP) today reported its second quarter of 2025 results:
Overview
- Q2 2025 operating loss of $251 million, shareholder net loss of $203 million, or $1.71 per share
- After taking into consideration adjusting items of $201 million, Q2 2025 operating loss of $51 million, compared to a similarly adjusted operating loss of $32 million in Q1 2025
- Solid earnings from Europe; North American operations impacted by sustained weakness in lumber benchmark pricing
- Persistent weak market conditions in the US South led to the announcement of the permanent closure of the Company’s Estill and Darlington sawmills, and, as a result, an asset write-down and impairment charge of $189 million and restructuring costs of $7 million in the lumber segment
- Rising global economic uncertainty put downward pressure on global pulp market fundamentals, particularly in China, and on North American kraft paper markets; global pulp producer inventories climbed to well above the balanced range
- The Canadian dollar strengthened by 3 cents, or 4%, versus the US-dollar quarter-over-quarter, weakening revenues
- Vida AB announced agreement to purchase AB Karl Hedin Sågverk (“Hedin”) for $164 million, including approximately $39 million of working capital, which will add 230 million board feet to Vida’s annual capacity
The Company reported an operating loss of $251.4 million for the second quarter of 2025, compared to an operating loss of $28.5 million in the first quarter of 2025. After accounting for adjusting items totaling $200.7 million, consisting of an inventory write-down as well as an asset write-down and impairment charge, the Company's operating loss was $50.7 million for the current quarter. This compares to a similarly adjusted operating loss of $32.2 million in the prior quarter. These results reflect a decline in results for both the lumber and pulp and paper segments.
Commenting on the Company's second quarter results, Canfor's President and Chief Executive Officer, Susan Yurkovich, stated: "While our European operations produced solid earnings this quarter, the North American market continued to experience significant challenges reflecting the impact of sluggish demand and a persistent weak pricing environment. During the second quarter, we made the difficult decision to permanently close our Estill and Darlington sawmills in South Carolina following an extended period of sustained financial losses. With punitive US softwood lumber duties combining with ongoing global economic and trade uncertainty, we remain focused on what we can control and will continue to leverage our globally diversified operating platform to combat these headwinds."
"For our pulp business" Yurkovich added, "our second quarter results were impacted by trade policy uncertainty between China and the US, which slowed pulp purchasing activity and gave rise to climbing pulp producer inventory levels and a declining US-dollar pulp pricing environment. We anticipate that these challenging conditions will persist well into the third quarter. Consistent with our approach in the lumber business, we are maintaining our focus on safety, reliability, productivity and disciplined cost management."
