West Fraser Timber's Q2 2023 sales were $1.608 billion, compared to $1.627 billion in the Q1 2023. Q2 2023 earnings were $(131) million, or $(1.57) per diluted share, compared to $(42) million, or $(0.52) per diluted share in the Q1 2023. Q2 2023 adjusted EBITDA was $80 million compared to $58 million in the Q1 2023.
“Early in the Q2 2023, we continued to experience challenging demand markets, particularly in the Pulp & Paper segment where we managed through several unscheduled downtime events at our mills, including an extended maintenance shutdown at Hinton Pulp as well as curtailment of our Cariboo Pulp mill related to fibre supply constraints. Combined with declining pulp prices that led to a significant inventory write-down, the Pulp & Paper segment experienced higher losses than expected. Notwithstanding these challenges, we did see signs of demand improvement for some of our key wood building products as the quarter unfolded against a backdrop of mortgage rates well above year-ago levels. Our North America EWP segment saw particular improvement this quarter, with recovering demand in our OSB business, which has given us sufficient confidence to increase our North American OSB shipments guidance for 2023. As in the prior quarter, the product and geographic diversification of our European Engineered Wood Panels segment provided another positive EBITDA contribution that helped offset some of the weakness in our other businesses,” said Ray Ferris, West Fraser’s President & CEO.
Outlook
The Company continues to expect total lumber shipments in 2023 will be similar to 2022 levels as the transportation challenges that West Fraser faced last year are not expected to be as severe in 2023, partially offset by the permanent British Columbia mill curtailments announced in August 2022, the indefinite curtailment of the Perry, Florida sawmill announced in January 2023, as well as downtime to complete capital upgrade projects at a number of our mills in the U.S. South. As such, West Fraser reiterates 2023 SPF shipments guidance of 2.6 to 2.8 billion board feet, and in the U.S. South, we reiterate 2023 SYP shipments guidance of 2.9 to 3.1 billion board feet.
West Fraser is a diversified wood products company with more than 60 facilities in Canada, the United States, the United Kingdom, and Europe
