West Fraser reports solid 2014
Feb. 19, 2015 – West Fraser reported solid sales figures for both the fourth quarter of 2014 and the full year despite reduced earnings versus those same time periods in 2013.
West Fraser Timber Co. Ltd. reported earnings of $43 million on sales of $964 million in the fourth quarter of 2014 and earnings of $259 million on sales of $3,856 million for 2014. In 2013, WFT reported earnings of $118 million on sales of $833 million in the fourth quarter and reported earnings of $349 million on sales of $3,474 million in 2013.
In the fourth quarter, lumber operations generated operating earnings of $90 million (Q3 - $101 million) and Adjusted EBITDA of $121 million (Q3 - $131 million). The benefit provided by a weaker Canadian dollar was offset by the effect of reduced shipments. Lumber markets remained relatively positive in the quarter despite declines in the U.S.-dollar prices for some lumber grades and dimensions. Shipments were adversely affected by some ongoing capital projects and fewer operating days.
The panel segment, which includes plywood, LVL and MDF, generated operating earnings in the quarter of $22 million (Q3 - $25 million) and Adjusted EBITDA of $25 million (Q3 - $29 million), mostly reflecting reduced plywood prices in the quarter due to a seasonal slowdown in the Canadian building industry.
Pulp and paper operations generated operating earnings in the quarter of $3 million (Q3 - a loss of $2 million) and Adjusted EBITDA of $12 million (Q3 - $9 million). Although Canadian dollar equivalent NBSK prices improved, NBSK production continued to be adversely affected by operational difficulties at the Hinton pulp mill following an extended maintenance shutdown in the previous quarter. Production at the mill improved by the end of the quarter.
"We are guardedly optimistic about 2015 as we see continued recovery of the U.S. housing market and we are seeing the results of some of our capital investment program. Although we have completed a majority of our capital investments, with over $400 million invested in 2014, we still have more to go." said Ted Seraphim, President and CEO. "Also in 2014, we acquired three sawmills, which, in combination with some major capital investments, has increased our lumber capacity by 400 million board feet this year."