The following is a summary of the Canfor Corporation (CFPZF) Q4 2023 Earnings Call Transcript:
Financial Performance:
Canfor Corporation witnessed a tough year in 2023 due to unfavorable lumber markets, high log costs and reduced shipping volumes but generated solid financial results in Europe and the US South.
They ended the year with over $350 million net cash to support continued reinvestment in their operations for the next few years.
The lumber business reported an operating loss of $162 million in Q4 and the US South operations also saw a downturn due to an 18% decrease in the Southern Yellow Pine 2x6 benchmark lumber price.
European operations managed to contribute $16 million of cash earnings in Q4 and $150 million for the full year of 2023.
Canfor Pulp reported weak performance with an operating loss of $15 million in Q4 and an adjusted loss of $26 million.
Total capital expenditures for 2023 amounted to $587 million.
Business Progress:
Canfor is optimistic about the Repair and Remodeling (R&R) market.
To improve their competitiveness, they took measures such as permanent closure of a sawmill, temporary curtailments, and completion of construction of a new facility in Louisiana.
Despite difficulties, Canfor Pulp aims to improve operating performance and cost structure while optimizing the available fiber supply.
A capital reinvestment plan has been identified at all mills to further support productivity and reliability.
They have planned capital spending of $400 million and $40 million in the Lumber and Canfor Pulp segments for 2024, respectively.
The company expects a modest increase in production in 2024, with the majority increase in 2025 and beyond.
More details: CANFOR CORP NEW IR
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