Canfor Suffered Operating Loss of $124M in Q3

SEATTLE (Scrap Monster): Canfor Corporation declared results for third quarter 2019. The company’s lumber and pulp and paper segment earnings recorded substantial decline, compared with the same quarter a year before.

The company reported operating loss of $124 million in Q3 2019. This compares with the operating income of $201.8 million in Q3 last year. The company attributed weak global market conditions and challenging fibre cost situation in B.C. for the poor performance. The Q3 adjusted operating loss was $69.4 million. The adjusted shareholder net loss for the quarter was $44.4 million, as compared with $156.9 million income reported in Q3 2018.

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The lumber market fundamentals remained essentially unchanged during the third quarter. Canfor’s total lumber shipments, at 1.23 billion board feet, were significantly down by 16% from the previous quarter. The ongoing production curtailments and mill closures in B.C region resulted in 15% decline in total lumber production during the quarter. The production totalled 1.18 billion board feet in Q3 this year. Meantime, pulp production slumped 42% quarter-on-quarter to 174,000 tonnes. Pulp shipments totalled 213,000 tonnes, recording decline by 26% from previous quarter.

Don Kayne, Canfor’s President and Chief Executive Officer noted that the company had an extremely challenging quarter. However, he remained hopeful of stability and slow recovery in lumber and pulp prices towards the end of 2019 and into 2020.