For the 1Q 2019, Canfor Corporation reported an operating loss of $69.9 million, an improvement of $9.2 million from the operating loss of $79.1 million in the 4Q 2018.
Commenting on the Canfor’s 1Q results, Canfor’s President and CEO, Don Kayne, said, “While our BC based lumber business experienced significant challenges due to lower than anticipated market prices and difficult operating conditions, our US South and European operations generated solid financial returns. We look forward to adding a further 200 million board feet to our US South operations during the 2Q with the upcoming close of the Elliott acquisition, which will help offset the escalating log cost and fibre supply issues impacting our BC operations.”
Total lumber production, at 1.25 billion board feet, was 11% above the prior quarter, primarily reflecting improved productivity and increased operating hours in the US South, following completion of the major upgrade of the Company’s Moultrie, Georgia sawmill at the end of 2018, combined with fewer statutory holidays in the current quarter, and the addition of European SPF lumber production in March. Lumber unit manufacturing and product costs were largely unchanged quarter-over-quarter as lower market-based stumpage offset the effects of cold weather in Western Canada early in the 1Q 2019, which resulted in lower log recoveries and reduced sawmill productivity, while in the US South, log costs saw a modest increase due to the prolonged wet weather conditions, which resulted in increased competition for available purchased wood.
Canfor is a leading integrated forest products company based in Vancouver, British Columbia (“BC”) with interests in BC, Alberta, North and South Carolina, Alabama, Georgia, Mississippi and Arkansas, as well as in Sweden with its recent majority acquisition of the Vida Group.
