Canfor (CFP) Q1 2025 earnings summary

Executive summary

• Q1 2025 saw an operating loss of $28.5 million and a net loss attributable to shareholders of $31.0 million ($0.26 per share), reflecting improved but still challenging market conditions compared to prior periods.

• Adjusted operating loss was $32.2 million, a significant improvement from $82.0 million in Q4 2024, mainly due to better lumber and pulp segment performance.

• North American lumber prices increased due to supply constraints, with improved results in Western Canada and solid European earnings; pulp segment also saw modest improvement.

• Adjusted results exclude non-operating items such as foreign exchange and derivative impacts.

• Transformation initiatives have increased resilience and ability to deliver stable returns despite market volatility.

Financial highlights

• Sales reached $1,417.5 million in Q1 2025, up from $1,285.7 million in Q4 2024 and $1,382.7 million in Q1 2024.

• Adjusted operating income before amortization was $68.9 million, up from $16.6 million in Q4 2024 and a loss of $10.4 million in Q1 2024.

• Adjusted net loss was $38.1 million ($0.32/share), compared to $39.9 million in Q4 2024 and $52.1 million in Q1 2024.

• Cash used in operating activities was $70.6 million, with capital additions of $122.1 million.

• Net debt increased to $498.6 million, with a net debt to total capitalization ratio of 12.2%.

Outlook and guidance

• North American lumber markets are expected to remain volatile in Q2 2025, with ongoing affordability and tariff-related disruptions likely to dampen demand.

• European lumber prices are forecast to rise due to supply constraints and high log prices.

• Global softwood pulp markets are anticipated to stay subdued amid economic and trade uncertainties.

• Maintenance outages at pulp mills are scheduled for the second half of 2025, expected to reduce production.

• Lower capital spend anticipated in 2025, with $250 million projected for lumber and $45 million for pulp.