West Fraser Timber's Q3 2023 sales were $1.705 billion, compared to $1.608 billion in the Q2 2023. Q3 earnings were $159 million, or $1.81 per diluted share, compared to $131 million, or $1.57 per diluted share in the Q2 2023. Q3 Adjusted EBITDA was $325 million compared to $80 million in the Q2 2023.
“While the Q3 2023 marked a continuation of the challenging demand markets we experienced in recent quarters, particularly in the Lumber segment where we executed curtailments at several locations for planned capital upgrades and to meet customer needs, our North American EWP business had its best result in several quarters against a backdrop of rising mortgage rates that remain well above year-ago levels,” said Ray Ferris, West Fraser’s President and CEO.
Cash and short-term investments increased to $1.204 billion at September 29, 2023 from $1.162 billion at December 31, 2022.
Outlook
West Fraser Timber continues to expect total lumber shipments in 2023 will be largely similar to 2022 levels since we have not experienced in 2023 the type of severe transportation challenges faced last year, though this has been partially offset by the permanent B.C. mill curtailments announced in August 2022 and the indefinite curtailment of the Perry, Florida sawmill announced in January 2023. However, while the Company is reiterating its 2023 SPF shipments guidance of 2.6 to 2.8 billion board feet, market demand in the U.S. South has begun to show signs of cooling and as such the Company now expects 2023 SYP shipments to be at the bottom end of its 2.9 to 3.1 billion board feet guidance range.
In its NA EWP segment, demand has remained relatively robust and as such the Company is reiterating its 2023 OSB shipments guidance of 6.1 to 6.4 billion square feet (3/8-inch basis). The modernization capital investment in Allendale, South Carolina is now effectively complete as the start-up phase of the mill, which began in late Q2-23, progresses in-line with expectations. The Company anticipates a ramp-up period of up to three years to meet targeted production and as such West Fraser Timber doesn't anticipate the Allendale mill contributing materially to shipments in 2023.
West Fraser is a diversified wood products company with more than 60 facilities in Canada, the United States, the United Kingdom, and Europe.
