Canfor Corp. Posted Record-High Paper and Pulp Segment Earnings

SEATTLE (Scrap Monster): Canfor Corporation reported strong financial results in 2018, registering the highest operating earnings in over 10 years. This was on the back of record-high paper and pulp segment earnings and solid lumber segment operating income.

The company announced key acquisition agreements towards purchase of Elliott Sawmilling Co., Inc. and major stake in the VIDA Group of Sweden. This will help the company to increase its lumber production capacity to approximately 7.2 billion board feet. Also, the company reported continued progress so as to complete various capital projects at its Moultrie, Fulton and Urbana sawmills. Further, the company decided to postpone the earlier announced construction of greenfield sawmill to the end of the current year, mainly on account of challenging market conditions.

Commenting on future outlook, Don Kayne, President and CEO noted that North American lumber prices are anticipated to see notable improvement during the first quarter of 2019, primarily on account of expected recovery in U.S. housing market and solid growth outlook from the U.S. repair and remodeling sector. The lumber demand from offshore markets is also expected to remain solid during Q1 ’19. The prices in Europe are projected to remain more stable due to solid demand in that region.

However, full-year 2019 results are likely to be impacted by continued log supply constraints in Western Canada.