West Fraser Timber Posted Marked Recovery in Q3 2020 Earnings

SEATTLE (Scrap Monster): West Fraser Timber Co. Ltd. reported results for the third quarter of 2020.

The adjusted EBITDA for Q3 surged higher to $605 million, compared to $184 million in the prior quarter. The cash flow from operations totalled $613 million for the quarter. The available liquidity improved by $546 million from the prior quarter to $1,346 million at the end of Q3. The company’s sales have increased by 32% to $1,690 million during the quarter. Also, West Fraser reported operating earnings of $487 million, in comparison with $83 million in the prior quarter.

The lumber segment generated operating earnings of $454 million and adjusted EBITDA of $552 million. The adjusted EBITDA increased by $424 million, mainly on account of higher lumber prices. The SYP shipment volumes surged, whereas the SPF shipment volumes recorded decline. The lumber segment operated at near capacity.

The panels segment generated operating earnings of $47 million and adjusted EBITDA of $51 million. The improved earnings were primarily due to elevated plywood pricing and robust plywood demand. Meantime, the pulp & paper segment generated operating earnings of negative $5 million and adjusted EBITDA of $5 million.

West Fraser Timber noted that pulp markets are likely to experience some stress in the near term on account of dip in demand for pulp used in printing and writing products.

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