West Fraser credits lumber prices for jump in earnings
Oct. 25, 2016 - The high price of lumber in the U.S. is behind West Fraser Timber Co.'s spike in earnings in Q3, the company reports.
West Fraser reported earnings of $107 million or $1.35 basic earnings per share on sales of $1,155 million in the third quarter of 2016.
In the quarter West Fraser’s lumber operations generated operating earnings of $114 million (Q2-16 – $78 million) and Adjusted EBITDA of $151 million (Q2-16 – $113 million). Higher U.S. dollar lumber prices contributed to the improvement in earnings.
The panel segment, which includes plywood, LVL and MDF, generated operating earnings in the quarter of $30 million (Q2-16 – $18 million) and Adjusted EBITDA of $33 million (Q2-16 – $21 million). Higher plywood prices were the main contributor to the improved earnings.
The company’s pulp & paper operations generated operating earnings of $22 million (Q2-16 – loss of $5 million) and Adjusted EBITDA of $31 million (Q2-16 – $4 million). Pulp and newsprint prices increased and pulp production was higher resulting in increased earnings.
“We’re pleased with the ongoing improvements from our capital spending program. I’m also very proud of our committed and focused employee group who continue to strive to improve operational performance each and every day,” said Ted Seraphim, our President and CEO.
Management’s Discussion & Analysis (MD&A)
The company’s MD&A is available on the company’s website: www.westfraser.com and on the System for Electronic Document Analysis and Retrieval at www.sedar.com under the company’s profile.
West Fraser is a diversified wood products company producing lumber, LVL, MDF, plywood, pulp, newsprint, wood chips and energy with facilities in western Canada and the southern United States.