In This Article:
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Operating Loss (Lumber Business): $336 million, including a $100 million asset write-down and impairment charge, and $121 million noncash duty-related adjustments.
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Adjusted Operating Loss (Lumber Business): $129 million, compared to $115 million in the prior quarter.
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Operating Loss (Pulp Business): $209 million, including a $211 million asset write-down and impairment charge.
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Adjusted Operating Income (Pulp Business): $2 million, an improvement of $7 million from the previous quarter.
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Net Debt (Canfor Pulp): $68 million.
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Available Liquidity (Canfor Pulp): $85 million, excluding a term loan commitment of $80 million.
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Net Cash (Canfor, excluding Canfor Pulp): Approximately $330 million.
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Capital Expenditures (Consolidated): Approximately $117 million in the quarter, including $18 million for Canfor Pulp.
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Anticipated Capital Spend (Lumber Segment 2024): Approximately $450 million.
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Anticipated Capital Spend (Pulp Business 2024): Approximately $50 million, including capitalized maintenance.
Release Date: October 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Canfor Pulp Products Inc (CFPUF) has successfully transitioned the Northwood mill to a one-line operation, improving operational efficiency.
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The company's Kootenay operations continue to perform well, supporting high-margin specialty products.
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Despite weak North American lumber pricing, Canfor Pulp Products Inc (CFPUF)'s Alberta operations provided positive earnings in Q3.
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The new sawmill in Axis, Alabama, began production, with an expected annual capacity of 250 million board feet.
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The Urbana upgrade project is in its final phase, expected to increase capacity to 285 million board feet, indicating growth potential.
Negative Points
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Canfor Pulp Products Inc (CFPUF) announced the closure of Plateau and Fort St. John operations in Northern BC, reducing production capacity.
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The company recorded significant losses in the lumber business due to weak lumber prices and increasing duties.
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Persistent challenges in accessing economically viable fiber in Northern BC continue to impact operations negatively.
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The pulp business generated an operating loss of $209 million, including a significant asset write-down and impairment charge.
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European operations face increasing log costs, which continue to pressure financial performance.
Q & A Highlights
Q: We've seen a slowdown in European lumber imports. Can you comment on Canfor's volume from the region and the impact of North American imports versus domestic demand in Europe? A: European imports are down due to slumping North American pricing, making it less competitive. Our volume from Vida into North America remained stable, largely committed to program business, particularly with home centers. However, transactional volumes did see a shift. - Kevin Pankratz, Senior Vice President - Sales and Marketing