Wood Business

Features Harvesting Logging Profiles
Survey Snippet #4 – Things getting better?

July 12, 2016 – Last week’s Survey Snippet looked at 2015 profit margins for Canadian contractors, showing significant variation according to company size as well as location (see report here). Today’s snippet looks at how that profit picture has changed over the past three years.


July 12, 2016
By Scott Jamieson

Topics

Overall, 16 per cent of contractors said their profit margin was higher than three years ago, with 15 per cent saying it was slightly higher and only a handful (1%) saying it was significantly higher. One third (33%) said it was unchanged, and 41 per cent said it was lower (17% slightly lower, 24% significantly lower). For 11 per cent the question did not apply (3% were new companies) or couldn’t/wouldn’t say (8%).

profit margin versus three years ago
 

That compares unfavourably to trends south of the border, as portrayed in the 2016 Timber Harvesting (TH) survey of U.S. contractors. TH magazine found only 22 per cent of contractors there had lower margins (versus 2010), or a rate half that of Canadian loggers. Almost half of U.S. loggers (47%) said their margins were about the same (33% in Canada), while 31 per cent said margins were better, double the Canadian response (16%).

Size matters
On this front, both the largest and smallest contractors fared the best. Those with revenues above $5M were the most likely to have seen increases (22%), followed by those with revenues of $1M or less (18%). Mid sized contractors ($1M to $5M) fared the worst, with only 10 per cent saying margins had improved.

Regionally, Atlantic Canada fared best when it comes to maintaining margins. Despite having middling overall margins, only 21 per cent of Atlantic contractors saw margins decline, and only five per cent said margins were significantly lower, compared to much higher percentages saying so in Quebec (25% significantly lower), Ontario (38%), BC Coast (32%) and BC Interior (28%). The regions varied between 40 and just over 50 per cent in terms of contractors that saw similar or slightly improved margins versus three years ago.

profit margin versus three years ago by region
 

Look for Survey Snippet #5 next week, when we look at machinery operator pay and benefits by company size and region.

Find more news from the CFI 2016 Contractor Survey on www.woodbusiness.ca and in our enews in the coming months, with a final digital report in August and a summary in the Sept/Oct print issue. Be sure to subscribe to the enews to get every item.

Missed Survey Snippet #3 – Real world logging profits? Read it here.


The survey was conducted in April 2016 by independent research firm Bramm & Associates, generating over 230 replies to a detailed list of questions. Respondents were distributed according to the geographic breakdown of the forest industry, with 50 per cent in Western Canada, 25 per cent in Quebec, and the rest found in Ontario, Atlantic Canada, and central Canada. Within BC responses were almost evenly split between the BC coast and Interior. Many thanks to our sponsors for making the research possible – Hultdins, Stihl, Tigercat and Ponsse. Also made possible with support from the Ontario Media Development Corporation (OMDC).


Print this page

Related



Leave a Reply

Your email address will not be published. Required fields are marked *

*