Conifex Timber Inc. reported results for the Q3 ended September 30, 2022. EBITDA was $4.2 million for the quarter compared to EBITDA of $3.3 million in the Q3 2021. During the Q3 2022, Conifex Timber generated net income of $0.9 million or $0.02 per share compared to net income of $12.3 million or $0.31 per share in the previous quarter and a net loss of $0.9 million or $0.02 per share in the Q3 2021.
Lumber Operations
Revenues from lumber products were $39.3 million in the Q3 2022 representing a decrease of 43% from the previous quarter and an increase of 2% from the Q3 2021. Compared to the previous quarter, the lower revenues in the current quarter were driven by reduced shipment volumes, combined with the effects of lower realized lumber prices. The revenue increase in the current quarter over the same period in the prior year was largely the result of higher volumes of Conifex produced lumber shipped, offset by more modest volumes shipped under our wholesale lumber program.
Outlook
“We anticipate prevailing external factors, including higher interest rates, contraction in new home construction and reduced repair and remodelling activities, have created an environment for weaker lumber prices in the Q4 2022 relative to prices in the third quarter. The transportation challenges that we faced through much of 2022 have recently eased, and we anticipate lumber shipments in the Q4 2022 to be in line with our sawmill production. We anticipate results for the fourth quarter to be comparable to the results achieved in the third quarter as expected business interruption proceeds related to the disruption of power plant operations are expected to offset weaker lumber operations contribution. Looking ahead to 2023, we expect to maintain robust sawlog inventories to support continuous operations at our sawmill. We have completed several key improvements to our sawmilling and finishing lines, which combined with the benefits of an expected green log diet, are expected to improve our production performance, achieve better lumber recovery and reduce conversion and fibre costs. While we continue to evaluate the effect of a green log diet on our 2023 operations, we anticipate that this will enable us to migrate to a lower and more enviable ranking on the lumber industry cost curve”, the Company said.
Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution.
