TORONTO, ON, November 13, 2023 - GreenFirst Forest Products Inc. (TSX: GFP) (“GreenFirst” or the “Company”) announced results for the third quarter and three quarters ended September 30, 2023.
The Company’s interim financial statements (“Financial Statements”) and related Management’s Discussion and Analysis (“MD&A”) for the third quarter and three quarters ended September 30, 2023 are available on GreenFirst’s website at www.greenfirst.ca and on SEDAR+ at www.sedarplus.ca.
Highlights
- Third quarter 2023 net earnings from continuing operations was $2.7 million or $0.01 per share (diluted), compared to net loss of $9.7 million or a loss of $0.05 per share (diluted) in the second quarter of 2023 on the same basis.
- Average lumber prices for Q3 2023 were higher than Q2 2023, with an average selling price of $642/mfbm compared to $596/mfbm in Q2 2023. There was strong pricing momentum toward the latter half of the second quarter due to supply related concerns, which benefited results at the beginning of the third quarter. However, volumes in the third quarter were lower than Q2 2023 due to reduced demand given macroeconomic uncertainties.
- The valuation provision for lumber and log inventory was decreased to $1.9 million from $8.7 million at the end of Q4 2022, generating a $6.8 million credit to cost of sales in the three quarters ended September 30, 2023.
- US Department of Commerce’s (“US DOC”) Final Determination of its Fourth Administrative Review resulted in a final duty rate of 8.05%. The Company stands to benefit from an approximate US$6.9 million (CAD$9.2 million) recovery on duties paid in 2021, as recorded in Q3 2023. Additionally, the ongoing lower duty rate has positively impacted the Company’s earnings and free cash flow since August 1, 2023.
- There continues to be downward pressure on newsprint and paper products prices.
- A corporate reorganization was initiated this fall to separate the assets from the lumber mills and the paper mill. This reorganization aims to provide for increased alignment of incentives, cost control measures and focus on the unique aspects of each business.
- On November 6, 2023, the company appointed Joel Fournier as its new Chief Executive Officer. Mr. Fournier is a seasoned executive with over two decades of hands-on experience in lumber mills across both Eastern and Western Canada.
“Our business showed resiliency in the third quarter, despite a low pricing environment,” said Paul Rivett, GreenFirst’s Executive Chair. “Our mill teams continue to focus on productivity gains, particularly the Chapleau team which has broken production records, and we expect further improvements in the coming quarters under the leadership of our new CEO, Joel Fournier.”
Source: GreenFirst Forest Products
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