West Fraser Lumber Segment Posted Operating Earnings of $19 Million

SEATTLE (Scrap Monster): West Fraser Timber Co. Ltd. reported results for the initial quarter of the current year.

The adjusted EBITDA was $127 million, significantly higher by $47 million from the prior quarter, primarily on account of improved prices, favourable foreign exchange rate movements and lower fiber costs. The sales too were up by 6% from the prior quarter at $1.195 billion, said company press release.

To counter the impacts of the Covid-19 pandemic, the company had to announce several adjustments to its operating schedules towards end of the quarter. Consequently, the quarterly lumber and plywood production took a hit by approximately 50 MMfbm and 10 MM sf respectively. The production is likely to be negatively affected over the coming months due to supply chain constraints and anticipated poor market demand.

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West Fraser’s lumber segment generated operating earnings of $19 million and adjusted EBITDA of $106 million. The panels segment operating earnings and adjusted EBITDA of $4 million and $8 million respectively. The pulp and paper segment reported nil operating earnings and $11 million in adjusted EBITDA.

Ray Ferris, President and CEO noted that the company’s strong balance sheet position, coupled with low-cost manufacturing operations and diversified product portfolio will help to manage through the impacts of the pandemic.