VANCOUVER, BC, Oct. 23, 2024 /PRNewswire/ – West Fraser Wood Co. Ltd. (“West Fraser” or the “Company”) (TSX andNYSE: WFG) reported lately the 0.33 quarter result of 2024 (“Q3-24”). All greenback quantities on this information loose are expressed in U.S. greenbacks except famous in a different way. 

3rd Quarter Highlights  

• Gross sales of $1.437 billion and income of $(83) million, or $(1.03) according to diluted proportion 
• Adjusted EBITDA¹ of $62 million, representing 4% of gross sales 
• Lumber area Adjusted EBITDA¹ of $(62) million, together with $32 million of export responsibility expense because of the finalization of AR5   
• North The us Engineered Plank Merchandise (“NA EWP”) area Adjusted EBITDA¹ of $121 million
• Pulp & Paper area Adjusted EBITDA¹ of $2 million 
• Europe Engineered Plank Merchandise (“Europe EWP”) area Adjusted EBITDA¹ of $1 million
• Repurchased 446,460 stocks for combination attention of $35 million
• Introduced indefinite curtailment of operations at lumber mill in Puddle Butler, Florida
• Next to quarter-end, repaid major and gathered pastime on $300 million senior notes on adulthood with coins readily available

“The benefits of our product diversification strategy were apparent once again in the third quarter of 2024, a period marked by uneven demand across our key products. North American OSB, plywood and other engineered wood products continued to experience healthy demand and the Lumber segment saw unexpected improvement in SPF demand, while SYP markets remained challenging, in part reflecting ongoing softness in repair and remodelling markets,” mentioned Sean McLaren, West Fraser’s President and CEO.

“The team at West Fraser has been actively improving the cost position across our portfolio of mills, and in particular we continue to make progress within our U.S. South lumber platform. We expect to continue working diligently to execute on our strategy of investing capital to modernize mills and lower costs, helping build a more resilient organization. We will also continue to return excess capital to shareholders when it is prudent to do so, maintaining our strong balance sheet that continues to allow West Fraser the financial flexibility to take advantage of opportunities that fit our long-term strategy.”

Effects Abstract 

3rd quarter gross sales had been $1.437 billion, in comparison to $1.705 billion in the second one quarter of 2024. 3rd quarter income had been $(83) million, or $(1.03) according to diluted proportion, in comparison to $105 million, or $1.20 according to diluted proportion in the second one quarter of 2024. 3rd quarter Adjusted EBITDA used to be $62 million in comparison to $272 million in the second one quarter of 2024. 

Liquidity and Capital Allocation 

Money and non permanent investments higher to $997 million at September 27, 2024 from $900 million at December 31, 2023.  

Capital expenditures within the 0.33 quarter had been $107 million.

We paid $26 million of dividends within the 0.33 quarter, or $0.32 according to proportion.

On February 27, 2024, we renewed our standard route issuer bid (“2024 NCIB”), which permits us to obtain as much as 3,971,380 Ordinary stocks for cancellation from March 1, 2024 till the expiry of the bid on February 28, 2025. From January 1, 2024 to October 22, 2024, 1,487,694 general stocks had been repurchased below each the prior NCIB and the 2024 NCIB.

As of October 22, 2024, we have now repurchased for cancellation 43,064,289 of the Corporate’s stocks for the reason that last of the purchase of Norbord on February 1, 2021 during the of entirety of a considerable issuer bid (“SIB”) in 2021, of entirety of a SIB in 2022 and standard route issuer bids, equalling 79% of the stocks issued in admire of the Norbord Acquisition.

On October 15, 2024, we repaid the major and gathered pastime on our $300 million senior notes on adulthood with coins readily available.

Outlook 

Markets 

A number of key developments that experience served as sure drivers lately are anticipated to proceed to aid medium and longer-term call for for untouched house building in North The us.

Probably the most vital makes use of for our North American lumber, OSB and engineered timber panel merchandise are residential building, restore and remodelling and commercial programs. Over the medium word, stepped forward housing affordability from stabilization of inflation and rates of interest, a massive cohort of the public coming into the everyday house purchasing level, and an growing old U.S. housing book are anticipated to pressure untouched house building and service and renovation spending that helps lumber, plywood and OSB call for. Over the long term, rising marketplace penetration of collection log in commercial and industrial programs could also be anticipated to grow to be a extra vital supply of call for expansion for timber development merchandise in North The us.

The seasonally adjusted annualized fee of U.S. housing begins used to be 1.35 million gadgets in September 2024, with allows issued of one.43 million gadgets, in line with the U.S. Census Bureau. Generation there are near-term uncertainties for untouched house building, owing in massive phase to the extent and fee of trade of loan charges and the ensuing affect on housing affordability, unemployment rest reasonably low within the U.S. and regardless that central bankers throughout North The us in the past indicated that charges could also be upper for longer, the latest fee mountaineering cycle is now in most cases believed to be over because the U.S. central attic has begun to short charges and Federal budget futures point out potentialities for close to word pace fee cuts. Those traits however, call for for untouched house building and our timber development merchandise might diminish within the close to word must the wider economic system and business sluggish or the fashion in pastime and loan charges negatively affect shopper sentiment and housing affordability.

In Europe and the U.Ok., we proceed to enjoy fairly higher call for for our OSB merchandise in 2024 however reasonably softer call for for MDF and particleboard panel merchandise. We proceed to be expecting call for for our Ecu merchandise will develop over the long term as usefulness of OSB as an spare to plywood grows. Additional, an growing old housing book helps long-term restore and renovation spending and extra call for for our timber development merchandise. Within the flow condition, inflation seems to have stabilized and rates of interest have begun to say no, which is directionally sure for housing call for. That mentioned, ongoing geopolitical traits and the lagged affect of prior inflationary pressures might adversely affect near-term call for for our panel merchandise within the U.Ok. and Europe. Regardless of those possibility components, we’re assured that we will navigate call for markets and capitalize at the long-term expansion alternatives forward.

With the tendencies of 1 UKP mill and two BCTMP turbines previous this yr, offset partly through reaching sole keep watch over of CPP, we predict the monetary affect of the Pulp & Paper area to be much less vital and to give a contribution a lot much less variability to our consolidated effects in the future.

Operations

Even though the call for condition for SYP has been reasonably vulnerable year-to-date, call for for SPF has exceeded our expectancies. The purchase of Spill Puddle lumber mill and reliability and capital development positive factors throughout our lumber mill portfolio are nonetheless anticipated to be greater than offset through capability discounts from just lately introduced everlasting closures and indefinite curtailments in addition to shift discounts throughout choose lumber turbines. As such, we now be expecting 2024 SPF shipments to rather exceed the lead terminate of our steering territory of two.6 to two.8 billion board toes day we reiterate our in the past revised SYP shipments steering of two.5 to two.7 billion board toes.

In our NA EWP area, regardless of expectancies of a normal seasonal slowdown in This autumn, we now await 2024 OSB shipments will likely be modestly upper than 2023 ranges, completing the yr nearer to the upper terminate of the steering territory of 6.3 to six.6 billion sq. toes (3/8-inch foundation). Get started-up of the Allendale mill continues to travel and we await a ramp-up duration for the mill of as much as 3 years to satisfy centered manufacturing ranges. We think our total OSB platform to be higher and lower price with a contemporary Allendale facility running, and as with any our timber merchandise operations, call for is a key enter in figuring out our running schedules throughout our production footprint. Enter prices for the NA EWP employment are anticipated to be reasonably strong via 2024. On the other hand, contemporary sawmill curtailments around the trade proceed to form chip shortages for pulp manufacturers, which is expanding call for stress for pulp woods, the main wool supply for OSB manufacturing.

In our Europe EWP area, we proceed to be expecting cushy near-term call for for our panel merchandise, with 2024 shipments of MDF, particleboard and OSB anticipated to be related or fairly higher than 2023 ranges. For OSB, with the closing a part of This autumn anticipated to be seasonally sluggish, we reiterate complete yr shipments steering within the territory of 0.9 to one.1 billion sq. toes (3/8-inch foundation). Enter prices for the Europe EWP employment, together with power and resin prices, are anticipated to stabilize in 2024 however stay increased.

On stability, we skilled reasonably strong prices for inputs throughout our provide chain once more in Q3-24, together with resins and chemical compounds, even supposing labour availability and a few capital apparatus govern instances remained difficult. We think those developments to in large part proceed over the close to word. 

In line with our flow outlook, assuming negative deterioration from flow marketplace call for statuses throughout the yr and negative extra lengthening of govern instances for tasks underway or deliberate, we’re narrowing the territory of expected capital expenditures to be roughly $475 million to $525 million in 2024¹.

Control Dialogue & Research (“MD&A”) 

Our Q3-24 MD&A and period in-between consolidated monetary statements and accompanying notes are to be had on our web site at www.westfraser.com and the Machine for Digital File Research and Retrieval + (“SEDAR+”) at www.sedarplus.ca and the Digital Knowledge Accumulating, Research and Retrieval Machine (“EDGAR”) web site at www.sec.gov/edgar below the Corporate’s profile. 

Sustainability Document 

West Fraser’s 2023 Sustainability Document is to be had at the Corporate’s web site at www.westfraser.com. This file summarizes our Environmental, Social, and Governance (“ESG”) efficiency with a focal point on our folk, communities and function of our merchandise within the carbon cycle. It’s aligned with the Sustainable Accounting Requirements Board (“SASB”), World Reporting Initiative (“GRI”), the Process Drive on Surrounding-Indistinguishable Monetary Disclosures (“TCFD”) and CDP (previously the Carbon Disclosure Challenge). 

Dangers and Uncertainties 

Possibility and confusion disclosures are incorporated in our 2023 Annual MD&A, as up to date within the disclosures in our Q3-24 MD&A, in addition to in our people filings with securities regulatory government. See additionally the dialogue of “Forward-Looking Statements” under.

Convention Name 

West Fraser will accumulation an analyst convention name to talk about the Corporate’s Q3-24 monetary and running effects on Thursday, October 24, 2024, at 8:30 a.m. Pacific Past (11:30 a.m. Japanese Past). To take part within the name, please dial: 1-888-510-2154 (toll-free North The us) or 437-900-0527 (toll) or join at the webcast. The decision and an income presentation can be accessed via West Fraser’s web site at www.westfraser.com. Please let the operator know you want to take part within the West Fraser convention name chaired through Mr. Sean McLaren, President and Eminent Govt Officer. 

Following control’s dialogue of the quarterly effects, buyers and the analyst public will likely be invited to invite questions. The decision will likely be recorded for webcasting functions and will likely be to be had at the West Fraser web site at www.westfraser.com. 

About West Fraser

West Fraser is a varied timber merchandise corporate with greater than 60 amenities in Canada, the USA, the United Kingdom, and Europe, which promotes sustainable jungle practices in its operations. The Corporate produces lumber, engineered timber merchandise (OSB, LVL, MDF, plywood, and particleboard), pulp, newsprint, timber chips, alternative residuals, and renewable power. West Fraser’s merchandise are worn in house building, restore and remodelling, commercial programs, papers, tissue, and field fabrics. For more info about West Fraser, seek advice from www.westfraser.com.

Ahead-Taking a look Statements 

This information loose contains statements and data that constitutes “forward-looking information” throughout the that means of Canadian securities regulations and “forward-looking statements” throughout the that means of United States securities regulations (jointly, “forward-looking statements”). Ahead-looking statements come with statements which are forward-looking or predictive in nature and are dependent upon or the following pace occasions or statuses. We usefulness phrases reminiscent of “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts,” or unfavorable variations thereof and alternative related expressions, or pace or conditional verbs reminiscent of “may,” “will,” “should,” “would,” and “could,” to spot those forward-looking statements. Those forward-looking statements in most cases come with statements which replicate control’s expectancies in regards to the operations, employment, monetary situation, anticipated monetary effects, efficiency, potentialities, alternatives, priorities, objectives, targets, ongoing goals, methods and outlook of West Fraser and its subsidiaries, in addition to the outlook for North American and global economies for the flow fiscal yr and next classes.

Ahead-looking statements incorporated on this information loose come with references to refer to and their affect on our employment:

• call for in North American and Ecu markets for our merchandise, together with call for from untouched house building, maintenance and renovations and commercial and industrial programs;
• the affect of sustained increased rates of interest and inflationary pressures on loan charges and housing affordability;
• the expected rising marketplace penetration of collection log;
• the expected moderation of rates of interest;
• our technique of bettering our value place throughout our portfolio of turbines and making an investment to modernize our turbines;
• the expected continuation of reasonably strong prices throughout our provide chain over the close to word and persevered demanding situations on labour availability and capital apparatus govern instances;
• operational steering, together with projected shipments and projected capital expenditures; and
• the continuation of investments in our belongings and the upkeep of our monetary flexibility and our cheap place as aggressive benefits.

By means of their nature, those forward-looking statements contain diverse guesses, inherent dangers and uncertainties, each normal and explicit, which give a contribution to the chance that the predictions, forecasts, and alternative forward-looking statements won’t happen. Elements that would motive original effects to range materially from the ones pondered or implied through forward-looking statements come with, however don’t seem to be restricted to:

• guesses in reference to the industrial and fiscal statuses within the U.S., Canada, U.Ok., Europe and globally and consequential call for for our merchandise, together with the affect of constantly vulnerable marketplace statuses on our skill to satisfy our flow lumber cargo steering, and variability of running schedules and the affect of the conflicts in Ukraine and the Center East;
• pace will increase in rates of interest and inflation or persevered sustained upper rates of interest and charges of inflation may affect housing affordability and service and remodelling call for, which might release call for for our merchandise;
• world provide chain problems might lead to will increase to our prices and might give a contribution to a discount in near-term call for for our merchandise;
• persevered governmental approvals and authorizations to get entry to log provide, and the affect of jungle fires, infestations, environmental coverage measures and movements taken through executive respecting Indigenous rights, identify and/or reconciliation efforts on those approvals and authorizations;
• dangers inherent in our product focus and cyclicality;
• results of pageant for woods, availability of wool and wool sources and product pricing pressures, together with persevered get entry to to plank provide and wool sources at aggressive costs and the affect of third-party certification requirements; together with reliance on wool off-take commitments and 0.33 social gathering customers of timber chips;
• results of diversifications in the associated fee and availability of producing inputs, together with power, worker wages, resin and alternative enter prices, and the affect of inflationary pressures at the prices of those production prices, together with will increase in stumpage charges and plank prices;
• availability and prices of transportation services and products, together with truck and rail services and products, and port amenities, and affects on transportation services and products of wildfires and unfortunate climate occasions, and the affect of higher power costs at the prices of transportation services and products;
• the recoverability of attribute, plant and kit ($3,819 million), approbation and intangibles ($2,270 million), each as at September 27, 2024, is in keeping with diverse key guesses which might be inherently unsure, together with manufacturing quantity, product pricing, uncooked subject matter enter value, manufacturing value, terminal more than one, and cut price fee.  Antagonistic adjustments in those guesses may govern to a metamorphosis in monetary outlook which might lead to sporting quantities exceeding their recoverable quantities and as a repercussion an impairment, which can have a subject matter non-cash antagonistic impact on our result of operations;
• transportation constraints, together with the affect of labour disruptions, might negatively affect our skill to satisfy projected cargo volumes;
• the timing of our deliberate capital investments could also be not on time, the terminating prices of those investments could also be higher because of inflation, and the projected charges of go back is probably not accomplished;
• numerous occasions that would disrupt operations, together with herbal, man-made or deadly occasions together with drought, wildfires, cyber safety incidents, any order of disaster and/or evacuation orders issued through governments, and ongoing members of the family with staff;
• dangers inherent to buyer dependence;
• affect of pace go border industry rulings or commitments;
• implementation of impressive strategic tasks and identity, of entirety and integration of acquisitions;
• affect of adjustments to, or non-compliance with, environmental or alternative laws;
• executive restrictions, requirements or laws supposed to release greenhouse fuel emissions and our incapability to reach our SBTi constancy for the aid of greenhouse gases as deliberate;
• the prices and timeline to reach our greenhouse fuel emissions goals could also be higher and tug longer than expected;
• adjustments in executive coverage and law, together with movements taken through the Executive of British Columbia pursuant to contemporary amendments to forestry regulation and tasks to defer logging of jungles deemed “old growth” and the affect of those movements on our log provide;
• affect of climate and state trade on our operations or the operations or call for of our providers and consumers;
• skill to enforce untouched or upgraded knowledge era infrastructure;
• affect of data era carrier disruptions or disasters;
• affect of any product legal responsibility claims in plenty of insurance policy;
• dangers inherent to a capital extensive trade;
• affect of pace results of tax exposures;
• doable pace adjustments in tax regulations, together with tax charges;
• dangers related to investigations, claims and felony, regulatory and tax lawsuits overlaying issues which if resolved unfavourably might lead to a loss to the Corporate;
• results of forex exposures and trade fee fluctuations;
• honest values of our electrical energy swaps could also be risky and delicate to fluctuations in ahead electrical energy costs and adjustments in executive coverage and law;
• pace running prices;
• availability of financing, attic traces, securitization systems and/or alternative way of liquidity;
• persevered get entry to to log provide within the conventional territories of Indigenous International locations and our skill to paintings with Indigenous International locations in B.C. to reserve persevered wool provide for our lumber turbines via numerous industrial commitments and joint ventures;
• our skill to proceed to preserve efficient interior keep watch over over monetary reporting;
• the hazards and uncertainties described within the MD&A and the 2023 Annual MD&A; and
• alternative dangers striking from while to while in our annual knowledge modes, annual reviews, MD&A, quarterly reviews and subject matter trade reviews filed with and furnished to securities regulators.

As well as, original results and result of those statements depends upon various components together with the ones issues described below “Risks and Uncertainties” in our 2023 Annual MD&A and the Q3-24 MD&A and might range materially from the ones expected or projected. This listing of impressive components affecting ahead‑shopping statements isn’t exhaustive and reference must be made to the alternative components mentioned in people filings with securities regulatory government.  Accordingly, readers must workout warning in depending upon ahead‑shopping statements and we adopt negative legal responsibility to publicly replace or revise any ahead‑shopping statements, whether or not written or oral, to replicate next occasions or instances except for as required through appropriate securities regulations.

Non-GAAP and Alternative Specified Monetary Measures

Right through this information loose, we create connection with (i) sure non-GAAP monetary measures, together with Adjusted EBITDA and Adjusted EBITDA through area (our “Non-GAAP Financial Measures”), and (ii) sure extra monetary measures, together with our anticipated capital expenditures (our “Supplementary Financial Measures”). We consider that those Non-GAAP Monetary Measures and Additional Monetary Measures (jointly, our “Non-GAAP and other specified financial measures”) are helpful efficiency signs for buyers in regards to running and fiscal efficiency and our monetary situation. Those Non-GAAP and alternative specified monetary measures don’t seem to be in most cases approved monetary measures below IFRS Accounting Requirements and wouldn’t have standardized meanings prescribed through IFRS Accounting Requirements. Traders are cautioned that none of our Non-GAAP Monetary Measures must be thought to be as an spare to income or coins tide, as motivated in keeping with IFRS Accounting Requirements. As there is not any standardized form of calculating any of those Non-GAAP and alternative specified monetary measures, our form of calculating each and every of them might range from the modes worn through alternative entities and, accordingly, our usefulness of any of those Non-GAAP and alternative specified monetary measures is probably not at once similar to in a similar way titled measures worn through alternative entities. Accordingly, those Non-GAAP and alternative specified monetary measures are supposed to serve extra knowledge and must no longer be thought to be in isolation or as an alternative choice to measures of efficiency ready in keeping with IFRS Accounting Requirements. The reconciliation of the Non-GAAP measures worn and introduced through the Corporate to essentially the most at once similar measures below IFRS Accounting Requirements is supplied within the tables poised forth under. Figures had been rounded to thousands and thousands of greenbacks to replicate the accuracy of the underlying balances and because of this sure tables won’t upload because of rounding affects.

Adjusted EBITDA and Adjusted EBITDA through area

Adjusted EBITDA is outlined as income motivated in keeping with IFRS Accounting Requirements including again refer to series pieces from the consolidated statements of income and complete income: finance source of revenue or expense, tax provision or healing, amortization, equity-based repayment, restructuring and impairment fees, and alternative source of revenue or expense.

Adjusted EBITDA through area is outlined as running income motivated for each and every reportable area in keeping with IFRS including again refer to series pieces from the consolidated statements of income and complete income for that reportable area: amortization, equity-based repayment, and restructuring and impairment fees.

EBITDA is recurrently reported and broadly worn through buyers and lending establishments as a hallmark of an organization’s running efficiency, skill to incur and repair debt, and as a valuation metric. We calculate Adjusted EBITDA and Adjusted EBITDA through area to exclude pieces that don’t replicate our ongoing operations and that are supposed to no longer, in our opinion, be thought to be in a long-term valuation metric or incorporated in an review of our skill to carrier or incur debt.

We consider that disclosing those measures assists readers in measuring efficiency relative to alternative entities that function in related industries and figuring out the continued coins producing doable of our employment to serve liquidity to investmrent operating capital wishes, carrier remarkable debt, investmrent pace capital expenditures and funding alternatives, and pay dividends. Adjusted EBITDA is worn as an extra measure to judge the running and fiscal efficiency of our reportable branchs.

Refer to tables reconcile Adjusted EBITDA to essentially the most at once similar IFRS measure, income.

Quarterly Adjusted EBITDA
($ thousands and thousands) 

Refer to tables reconcile Adjusted EBITDA through area to essentially the most at once similar IFRS measures for each and every of our reportable branchs. We imagine running income to be essentially the most at once similar IFRS measure for Adjusted EBITDA through area as running income is the IFRS measure maximum worn through the important running resolution maker when comparing area running efficiency.

Quarterly Adjusted EBITDA through area
($ thousands and thousands) 

Anticipated capital expenditures

This measure represents our perfect estimate of the amount of money outflows in the case of additions to capital belongings for 2024 in keeping with our flow outlook. This quantity is comprised essentially of numerous development tasks and maintenance-of-business expenditures, tasks serious about optimization and automation of the producing procedure, and tasks to release greenhouse fuel emissions. This measure assumes negative deterioration in flow marketplace statuses throughout the yr and that we’re ready to travel with our plans on while and on price range. This estimate is topic to the hazards and uncertainties known within the Corporate’s 2023 Annual MD&A and Q3-24 MD&A.

For Extra Data

Investor Touch
Robert B. Winslow, CFA
Director, Investor Members of the family & Company Construction
Tel. (416) 777-4426
[email protected]

Media Touch

Joyce Wagenaar
Director, Communications
Tel. (604) 817-5539
[email protected]

SOURCE West Fraser Wood Co. Ltd.

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