Interfor Corporation reported a net loss of $104.6 million in the fourth quarter of 2025, reflecting continued pressure from weak lumber pricing, higher duties and tariffs, and production curtailments across its operations.
The loss equated to $1.59 per share, improving sequentially from a net loss of $215.8 million in Q3’25, but wider than the $49.9 million loss recorded in Q4’24. Adjusted EBITDA was a loss of $29.2 million on sales of $600.6 million, compared with an adjusted EBITDA loss of $183.8 million in the previous quarter and positive adjusted EBITDA of $80.4 million a year earlier.
Liquidity reinforced through financing actions
During and subsequent to the quarter, Interfor completed a series of financing transactions aimed at strengthening liquidity and financial flexibility. As of December 31, 2025, the company reported available liquidity of $481.6 million on a pro forma basis and a net debt-to-invested-capital ratio of 36.5%.
Key steps included a bought-deal equity offering completed in October 2025, generating gross proceeds of $143.8 million, and the establishment of a US$26 million letter of credit facility backed by Export Development Canada. In early 2026, Interfor also secured commitments for a $30 million term loan under the Government of Canada’s Softwood Lumber Guarantee Program and US$75 million in new senior secured notes, expected to close in the first quarter of 2026.
Amendments to the company’s revolving term line and senior secured notes increased covenant flexibility, extended headroom on leverage thresholds, and set minimum liquidity requirements, while maintaining the July 2029 maturity date for the term line.
Production curtailments and asset impairments
Lumber production totaled 753 million board feet in Q4’25, down 159 million board feet from the prior quarter, largely reflecting temporary curtailments announced in October. Shipments exceeded production, allowing Interfor to reduce inventories by approximately 63 million board feet during the quarter.
Average selling prices declined to $599 per thousand board feet, down $19 from Q3’25, reflecting weaker benchmark pricing across most lumber categories. Prolonged market weakness, combined with higher duties and mill-specific factors, led to a $69.1 million impairment charge against property, plant, and equipment in Eastern Canada.
Coastal B.C. monetization and capital spending
Interfor completed the sale of Coastal British Columbia forest tenures and related assets during the quarter, generating $10 million in gross proceeds and a gain of $9.5 million. The transaction concluded the company’s monetization of those operations, with no remaining contractual obligations at year-end. Additional coastal tenures remained available for potential disposition, subject to regulatory approvals.
Capital expenditures totaled $17.5 million in Q4’25, including continued investment in the multi-year rebuild of the Thomaston, Georgia sawmill, which is expected to be completed in the first quarter of 2026. For the full year ahead, capital spending is projected to range between $75 million and $80 million.
Duties, tariffs weigh on results
Export duties remained a significant cost headwind. Interfor recorded $31.2 million in countervailing and anti-dumping duties during the quarter on Canadian lumber shipments to the U.S., reflecting a combined duty rate of 35.16%. Cumulative duty payments reached US$663.5 million as of year-end. The company also incurred $4.7 million in costs related to the 10% U.S. Section 232 tariff imposed on softwood lumber imports in October 2025.
Outlook: volatility expected to persist
Interfor expects North American lumber markets to remain volatile in the near term as the industry adjusts to shifting monetary policy, trade measures, labour constraints, and geopolitical uncertainty. While benchmark lumber prices rebounded late in Q4’25 and into early 2026, the company cautioned that higher duty rates and tariffs are likely to amplify price swings.
Over the medium term, Interfor anticipates that Canadian lumber will continue to play a critical role in supplying the U.S. market, as growth in U.S. manufacturing capacity remains constrained. Supported by a diversified operational footprint in both Canada and the United States, the company believes it is positioned to manage market volatility and capture value over the lumber cycle.
Interfor is a growth-oriented forest products company with operations in Canada and the United States. The company has annual lumber production capacity of approximately 4.4 billion board feet and supplies a broad range of lumber products to customers across North America and international markets.
Source: Interfor
