West Fraser Timber Q3 2023 Earnings Call Transcript

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Provided by Quartr
October 26, 2023

There are 8 speakers on the call.

Operator

Good afternoon, ladies and gentlemen, and welcome to the West Fraser Q3 2023 Results Conference Call. Please note that all lines have been placed on mute to prevent any background noise. After the speakers' remarks, During this conference call, West Fraser's representatives will be making certain statements about West Fraser's future financial and operational performance, Business Outlook and Capital Plans. These statements may constitute forward looking information or forward looking statements within the meaning of Canadian and United States Securities Laws. Such statements involve certain risks, uncertainties and assumptions, which may cause West Fraser's actual or future results and performance to be materially different from those expressed or implied in these statements.

Operator

Additional information about these risk factors and assumptions is included both in the accompanying webcast presentation and in our 2023 Annual MD and A and Annual Information Form, which can be accessed on West Fraser's website or through SEDAR Plus for Canadian investors and EDGAR for United States Investors. Thank you. Mr. Farris, you may begin your conference.

Speaker 1

Well, thank you, operator. And look, good morning and thank you for everyone joining our Q3 earnings call. My name is Ray Farris, President and Chief Executive Officer of West Fraser. And joining me today is Sean McLaren, our Chief Operating Officer, who we Previously announced, we'll be assuming the role of President and CEO effective January 1, 2024 and Chris Virostek, our Chief Financial Officer, as well as Matt Tobin, our VP of Sales and Marketing and several other members of our leadership team. This quarter, I am very pleased to inform you that Sean McLaren and I and Matt are joining the call from our OSB Mill in Chambord, Quebec.

Speaker 1

As I'm sure you are aware, our West Fraser team has been particularly busy this past period With the recently announced divestitures of 3 of our pulp mills and the acquisition of a sawmill and wood treatment operation and associated forest management agreements in Alberta. All of these moves are aligned with our long term strategy To be a premier, low cost, sustainable and renewable wood building products producer and key supplier to our customers. Our team has been successfully processing and executing on these announced changes, all the while Navigating uncertain, sometimes conflicting, difficult to predict demand fluctuations within the very product and geographic regions we serve. Before I hand the call to Chris Birostek to discuss our Q3 financials further, I'd like to reinforce how thankful and grateful We are for the team at West Fraser. We're continually adapting to meet the needs of our growing company, in particular to our employees within our pulp team, of which no organization could ask for more.

Speaker 1

The dedication and hard work of this is shared and appreciated by all of our nearly 11,000 employees. As we will discuss on this call, despite persistently varied and mixed demand markets, We posted strong improvement in EBITDA over the prior quarter. And as we'll talk further, we'll also have Sean available to answer questions later in your call as well. But for now, let me hand it back to Chris who will walk us through our Q3 financial results.

Speaker 2

Thank you, Ray, and good morning, everyone. And just as a reminder, we report in U. S. Dollars and all the references today And our comments will be the U. S.

Speaker 2

Dollars unless specified otherwise. West Fraser generated $325,000,000 of Consolidated adjusted EBITDA in the 3rd quarter improving from the $80,000,000 of adjusted EBITDA reported in the 2nd quarter. Our North American EWP segment Generated $289,000,000 of adjusted EBITDA, up from $126,000,000 in the prior quarter. OSB strength carried over from The price strength carried over from the prior quarter. The lumber segment posted $44,000,000 of adjusted EBITDA this quarter, up from $10,000,000 in the prior quarter, With this quarter negatively impacted by production curtailments for capital projects as well as extreme weather in parts of Florida and Georgia.

Speaker 2

The majority of the sequential improvement this quarter was driven by a $62,000,000 export duty recovery. In the prior quarter, we benefited from favorable changes related to inventory value adjustments valuation adjustments. Although these adjustments were not a significant part of the Q3 results in lumber, the net result was a $35,000,000 negative impact relative to the 2nd quarter on a sequential basis. The Pulp and Paper segment improved, But profitability remains challenging in the 3rd quarter, posting negative $12,000,000 of adjusted EBITDA versus negative $74,000,000 in the prior quarter. As a reminder, last quarter was marked by considerable disruption within the pulp segment with all 4 of our pulp mills taking downtime.

Speaker 2

In Europe, adjusted EBITDA was $4,000,000 in the 3rd quarter as the demand weakness that had begun to unfold late in the second quarter persisted. These 3 Q3 results were down from $19,000,000 of adjusted EBITDA in the second quarter. In summary, price strength across our North American EWP business was the largest positive driver of the company's sequential EBITDA improvement, which more than offset demand challenges in our lumber, pulp and EU segments. Cash flow from operations was 355,000,000 quarter and cash net of debt increased to $663,000,000 from $449,000,000 last quarter. This quarter's cash flow more than covered $25,000,000 of dividends paid and $115,000,000 for capital expenditures.

Speaker 2

We also repurchased $25,000,000 of shares in the 3rd quarter and a further $53,000,000 between quarter end October 24. In terms of our operational outlook for 2023, we are reiterating guidance for North American OSB and SPF lumber shipments, We're reducing guidance for SYP shipments as market demand for lumber in the U. S. South has begun to cool. We therefore now expect our SYP shipments Also given the weakening trend in European OSB demand, we now expect OSB shipments there to be near the low end of the guidance range of 1,000,000,000 to 1,200,000,000 board feet On a 3eight inches basis.

Speaker 2

In terms of capital spending for 2023, based on equipment delivery schedules and spending levels to date, We now anticipate capital investment will be approximately $450,000,000 down from last quarter's expectation that we would spend near the bottom end of our $500,000,000 to 600 Looking back over the last four quarters, which have undoubtedly been challenging for the Wood Products industry, Our diversified portfolio of assets has generated consolidated EBITDA of $472,000,000 excluding the $62,000,000 export duty recovery this quarter. And this trailing 12 month EBITDA would have been markedly higher on a pro form a basis after giving effect to the pending sale of the 3 pulp mills and the pending acquisition of Spray Lake Sawmills. For comparison, this latest level of trough like EBITDA is significantly higher than the financial results generated in similarly weak markets experienced in 2019, which reflects the success of the Norbord acquisition and integration as well as the other mill additions in Capital improvements we have made to the West Fraser portfolio in recent years. With that overview, I'll now pass the call back to Ray.

Speaker 1

Thank you, Chris. Before I kind of further reflect on our financial performance in the Q3, I'll just spend a couple of moments addressing some of the corporate development initiatives we've undertaken recently, As Chris has mentioned, namely the sales of these pulp mills as well as the acquisition of the sawmill in Alberta. In early July, we announced the planned sale of our Hinton Alberta pulp mill to a key strategic partner, Mondi Group Plc, which we addressed on our last earnings call. So I won't spend much time on that transaction other than to say that we now expect the transaction to close early in 2024. Since the Hinton announcement, we also announced the planned sale of our 2 BCTMP Mills, namely the Slade Lake Pulp Mill in Alberta and the Cornell River Pulp Mill in British Columbia to Atlas Holdings for US120 $1,000,000 Upon closing of this transaction, which is expected in early 2024, these two mills are to be operated by Miller Western Forest Products, A 100 year old Canadian forest price company that joined Atlas Holdings in 2017.

Speaker 1

We believe this transaction will provide these great pulp mill assets and teams with a strong strategic future We're also allowing West Fraser to focus its resources on our objective of being a premier wood building products company. This quarter, we also announced the planned CAD140 1,000,000 acquisition of Spray Lake Sawmills located in Cochrane, Alberta. This transaction includes not just a sawmill and wood treatment facility, which produces a varied value added treated wood products as well as a variety of innovative wood residuals and other byproducts. This acquisition also comes with 2 forest management agreements with a total annual level cut of approximately 500,000 cubic meters. With the current expected transaction to close by year end, this will enable West Fraser to grow its footprint in Southern Alberta and expand its Canadian treated wood business while providing access to a high quality fiber supply, which is synergistic with our existing That these three transactions are a continuation of our ongoing strategy of always looking to improve our earnings quality Through the cycle of the regions and products we serve.

Speaker 1

Now shifting thoughts back to Q3. This quarter, we continue to experience relatively soft demand, particularly in our lumber segment, as consumers manage through period of elevated mortgage and interest rates, which appear to be impacting affordability and overall consumption. Market weakness was also evident in our European operations where high inflation and mortgage rates are dampening housing and home improvement markets. Contrast these trends, however, with our North American Engineered Wood Panels business, where we experienced more solid demand through much of the quarter before showing signs of slowing towards the end of the quarter, particularly for our OSB products. With respect to outlook, we expect the Wood Billings Products industry will continue to face near term challenges from factors including interest rates That may remain higher for longer, ongoing labor constraints and the potential for muted product demand, primarily due to housing affordability headwinds.

Speaker 1

In recent quarters, we have seen inflationary cost pressures moderate across much of our supply chain, including for raw materials such as energy, resins and chemicals, and to some extent, wood fiber. And though difficult to predict, we do expect some upward cost pressure in Q4, particularly for energy related inputs. In terms of new home construction and repair and remodeling markets, while we do see demand risks in the near term, We continue to believe the North American housing market is structurally underbuilt and has an aging housing stock, which over the mid to longer term should and will support a favorable demand potential for our building products. In closing, while near term uncertainties exist Across the industry and our business, we are confident in the geographic and product diversity we have built and in our operating and growth strategies. Our company has a long and successful track record of steadily and progressively evolving to meet the needs of our employees, Our communities and of course, our shareholders, including more recently with the acquisitions of Norbord, the modern Angelina sawmill, the large scale Allendale OSB Mill, that's currently in startup.

Speaker 1

And Our recent balance sheet remains strong and well positioned for the future. This team has been through economic and industry cycles Before and we continue to believe we have the people, the assets and financial flexibility to allow us to take advantage of opportunities and overcome challenges when they arise. And although it is unclear when Michael's market cycles will We will remain disciplined in our capital allocation strategy, investing in and improving our assets through the cycle. As we look ahead, we will continue to focus on being a low cost, efficient supplier of renewable and sustainable woodbilling products, We remain committed to our prudent capital allocation strategy and to a future where good fundamentals support growth And demand for the types of sustainable renewable wood products for which West Fraser is known. Finally, Before I turn the call over for Q and A, I thought I would mention a few things about the transition to Sean as President and CEO at year end.

Speaker 1

Sean and I have worked very closely together for almost 20 years, both growing together with the company. Sean originally joined with Welwood Canada based in Vancouver, but has lived and worked across The company from Burns Lake, British Columbia to Hinton, Alberta, both in Pulp and Lumber to Sundry, Alberta to Rocky Mountain House Laminated Veneer Lumber The Cornell Pulp and Lumber Operations, including 2 different stints in 1 in Savannah Joerner, Georgia and of course the last number of years based in our Memphis office in Tennessee. Sean has been a key driver and a leader Across multiple business segments and regions, often moving seamlessly between finance and operations roles, We are so fortunate to have such a strong, knowledgeable and natural people leader in our company, which will support a seamless and efficient transition For all of us here at West Fraser and for me, I'm very thankful for that. With that, we'll turn the call back to the operator for questions.

Operator

Questions will be taken in the order received. And your first question is from Hamir Patel from CIBC. Please ask your question.

Speaker 3

Hi, good morning. Ray, I saw the Henderson startup looks like it's pushed out to 2 quarters. Can you speak to some of the other projects that you might have over the next couple of years? I know you did Opelika and Henderson, but I'm assuming there's some other ones that Are to follow and what sort of scale we could expect in terms of production growth?

Speaker 1

Well, good morning, Hamir, and good question. And I'll maybe get Sean, to tap in on the end of this one. But before I do that, look, we've I think one point I'd want to make on Henderson is anymore And all of our capital. It is what I would call full steam ahead. The only thing that slows us down today is really supply chain issues.

Speaker 1

And look, we and so that's the only reason for the slight delay and We're pretty excited about getting through and seeing that mill start up. With respect to I'm not sure exactly what we've given in guidance. What I would say is, we're continuing to make progress And on significant progress on our platform, U. S. Lumber platform, But we still do have a few more, what I would call, excellent projects that we have in the queue.

Speaker 1

I don't think we've given a lot of detail on that, but I kind of look at these are ones that we're going to be very excited to Announce them and bring them forward when that time is right and looking forward to having those conversations. So when we think about our future in the U. S. South, it's One where we see much opportunity to improve what we have, Both by lowering costs and by growing our footprint. But Sean, anything you want to add to that?

Speaker 4

No, I think that is Perfect, Ray. I mean, we continue to have a number of projects, merchandisers, canner lines, different things that are Smaller in nature than a Henderson, but really kind of move our cost curve and our competitive position in the U. S. South. So A number of those are in motion and very pleased with the progress on them.

Speaker 3

Great. Thanks, Ray and Sean. Sean, another question I had for you is with the pending sale of most of the pulp and paper assets, do you expect Future M and A to be focused on the remaining sort of lumber and OSB businesses? Or do you see some adjacent categories in wood Products that might interest the company to grow into either organically or via M and A.

Speaker 4

Good morning, Hamir. From an M and A perspective, I think you can look at what we've done over the last several years that make us Stronger, the bar is quite high for us in West Fraser in terms of we look at a lot of things, but in terms of things that we know will fit into our footprint and make us immediately stronger. We've got our biggest opportunity is modernizing what we have internally. So I think we'll continue on that path. And if it's synergistic to our existing business in Wood Products, we'd look at it.

Speaker 4

If it's a strong In addition to the company, we continue to discuss it internally. One thing I'd add on to that, Hamir, is

Speaker 1

that built into the DNA of Today, we might be able to consider going forward as the company continues to change. So I think it's an ongoing Conversation. And as the world changes, I'm sure we're going to continue to look at all things that are out there and figuring out where to take the company.

Speaker 3

Yes, fair enough. Thanks. That's all I had. And Ray, all the best in retirement. Thanks.

Speaker 1

Thank you, Hamir.

Operator

And your next question is from Sean Steuart from TD Securities. Please ask your question.

Speaker 5

Thank you. Good morning, everyone. Couple of questions. And Ray or Sean, I want to just follow-up on the CapEx question. With respect to supply chain lag and longer lead times for equipment, I guess I would have expected that with weaker markets, there might have been a little more slack in that element, Potentially some of your competitors slowing their discretionary spending plans because markets have weakened.

Speaker 5

Is there any particular Part of the supply chain, particular pieces of equipment where you're seeing these lags intensify, just any more detail you can give us on that front?

Speaker 1

Well, good morning, Sean. And I'll take a crack at it first here. Look, I mean, I think it I guess we'll see what happens over the next few years here. But I would say There was so much stuff in the pipeline that I think as we look out, you can see that things are improving and easing, but The things that were in the pipeline, we're still in the pipeline. So I think there are Certain segments and parts that where you can see equipment and things coming quicker and others which quite frankly haven't changed at all yet, But they may down the road.

Speaker 1

But look, the one thing that hasn't changed is access to people and the what I call the contractors And people that can actually build and build a project. So labor is still the primary constraint, Assuming you've overcome your equipment part,

Speaker 4

so Good morning, Sean. Not a lot to add to that. I really think the Henderson and And some of the delays we've experienced have been due to backlog and that is getting better. So I think on future projects, it might be Some a bit faster, but there's still a backlog out there.

Speaker 5

Okay. Thanks for the extra detail there. Question on your European EWP business. Weakest margins we've seen there

Speaker 4

for a while, which I suppose

Speaker 5

it isn't entirely surprising given the macroeconomic backdrop. Can you give us a sense of given that it's a less transparent market, Ongoing pressure you're seeing into the Q4 and maybe early next year. And it sounds like you're curtailing Your shipment guidance a little bit for that business. Do you have a sense of any incremental downtime that's being taken elsewhere given Skinny margins for that business at this point?

Speaker 1

Well, Sean, look, I no, don't really have anything on respect To other curtailments or what, but I think you can look at the trends over the last year. I mean the economy certainly has continued to slow steadily throughout the last year. And it remains weak at the moment. I think our visibility into next year is Probably the same as yours and I think we're just really focused. What I would say is, We're really quite pleased with how our operations are performing over in Europe, Really operating to meet available customer demand.

Speaker 1

So what I would say in a very difficult Demand and market, I think we're pretty happy with the way we're kind of so it gives us quite a bit of confidence that even as Things slow down a bit more that our team has figured out how to kind of weather that storm, if you will, if that's the right way to put that. So I guess we'll see, but I do think that our outlook is probably much more A little bit slower going forward, at least in the current term.

Speaker 5

Okay. All right. Thanks very much for the detail. Congrats to both Sean and Ray on the transition. We look forward to seeing what comes with it going forward.

Speaker 1

Thank you, Sean. Thank you, Sean.

Operator

Thank you. Your next question is from Ketan Mamtora from BMO Capital Markets. Please ask your question. Hello, Ketan. Your line is now open.

Operator

It seems that Ketan has disconnected. We'll just take the next question. It's from Paul Quinn from RBC Capital Markets. Please ask your question.

Speaker 6

Yes, thanks very much. Good morning, guys. To start with Allendale, I know you started that mill up in June, just what's the run rate at the end of the Q3 or How do you see that mill progressing and what is it qualified to sell?

Speaker 1

Well, good morning, Paul. And yes, good morning, Paul. So Look, we're quite pleased with the start up so far. As you might understand, it's It's pretty early in the ramp up curve, which I think we've said kind of 2 or 3 years. I don't know if we've given what the actual guidance was For this year and so but I would say, historically, you look back and you look at the OSB ramp up curves, We're very close or on plane with where we want to be and happy with the start up so far actually.

Speaker 1

And but I think what we've said is, it wouldn't be significant This year is that I guess I don't mean to be flippant, but I guess perhaps stay tuned to see how well that goes next year.

Speaker 6

Okay. And then just noticing that you've got now almost US825 $1,000,000 on deposit, hearing from Some of your competitors that there's been some chatter on that file, the sulfur lumber. What is your take On the current situation and how do we get to a resolution?

Speaker 1

Well, I would say it remains certainly You know, frustration for the industry and for West Fraser, I think, I mean, obviously, we're on both sides of the border. We certainly do not agree With the duties and I think that's well documented. Paul, look, you will see chatter in the paper Time to time, with industry, trying to work together to develop Some thoughts about how to overcome the impasse, but I can also say there's there really isn't anything going on other People talking about what could be done or what might be done should things improve, but today the governments aren't talking And there's really no discussion between the U. S. And Canada.

Speaker 1

But look, we're we continue to want to see resolution And we're going to look for those catalysts to try and do that for What impact West Fraser has on those decisions?

Speaker 6

Again, just in the past, that sort of the legal route, whether it's through and WTO used to really sort of spurn on those discussions. Where are we at in those two legal paths?

Speaker 1

First, Paul, I would say, I'm quite involved and I can We tell you that as a multiple I am as confused about if I tried to describe the legal status of all the different things that were going on between CBD and Andy Dumping, I'm sure I would get it wrong. And I mean, I think it's out there in the public domain. And so I still want to try and trip something up. I think you saw that there was a couple of recent announcements around Decisions being remanded back to the Department of Commerce, but again, those immediately go on appeal and away we go again. So I would say despite the fact that you'll see and read things in the media and there are some decisions being made, I don't think from a West Fraser point of view, it's fundamentally changed Materially where we're at is that we're this hasn't moved us closer to a resolution at this standpoint.

Speaker 1

So from our perspective, It looks like this is a ways away before resolution. And then just lastly, I mean, I've been covering the company for

Speaker 6

20 years and it seems when I first started, West Fraser had a pretty decent Gap on competitors, it seems to be eroded over time. And just wondering, is that because the competitors have got a lot better? Or what do you attribute That, that, I mean you used to have a little bit of blue sky between you and others and now it seems You're right there neck and neck with the top ones, what's the change?

Speaker 1

Well, Not sure I'd 100% agree with that statement, Paul, but I will say I don't think anyone Has grown more than West Fraser. We continue to operate in our lumber side, 3 distinct areas, British Columbia, Alberta and U. S. South, and these are the tale of 3 cities. And I would say we're very happy in some areas and not so happy in others and making the decisions With our portfolio and operating strategy to put ourselves in the position in the long term.

Speaker 1

But and so Those that don't have to spend a lot of time in the more difficult areas, it's That can be helpful. But I really do I think we, not me, but we very much think we have the right Asset mix and are growing in the regions that we want to grow in and shrinking in the regions that we think We need to. And so it's a long race. I guess we'll see where we get to. All right.

Speaker 1

Hey, congratulations on the retirement, Ray. Best of luck, Sean. Thanks, Paul. Thank you, Paul.

Operator

Thank The next one is from Ketan Mamtora from BMO Capital Markets. Please ask your question.

Speaker 7

Okay. Let's try this again. Can you hear me?

Speaker 1

Can you hear you, Ketan?

Speaker 7

Can you hear me okay?

Speaker 1

We can hear you, Ketan.

Speaker 7

Okay, perfect. Sorry about that earlier. Hey, Chris, maybe to start with, can you give us some sense How you are thinking about CapEx for 2024? It certainly sounds like there is some carrying forward from 2023, Particularly in this environment where there is still quite a lot of uncertainty, perhaps maybe even at a high level that would be helpful.

Speaker 2

Sure. So I think when we consider kind of what's happened the last couple of years is we've had Fairly ambitious capital plans and we've been in particular over the last couple of years a bit frustrated by the delays that have happened from Supply chain standpoint and have had spillover into the following year in that case in the last couple of years and it looks like 2023 to 2024 is not going to be any different in that front. In terms of the philosophy that And how we're thinking about CapEx kind of relative to the market is we were quite careful through 2021 and 22 to preserve liquidity to make sure that our allocation strategy could be durable agnostic to market cycles. And so we've got some great opportunities to invest capital as Sean and Ray indicated that continues to take action in the Portfolio where it makes sense to improve the asset quality over time. And frankly, some of the best time to do that is in a weak market, Because the market will recover at some point in time and we'd rather spend the capital now and make the improvements now And that's across everything.

Speaker 2

It's not just about capacity. It's grade, it's recovery, it's cost, all those elements. And to do that work now in a softer market when there's room to do it from a supply demand standpoint. And then when the market recovers, we're ready to meet our customers' demands and produce what they're looking for in the quantities they're looking for at that time. So I think with where we position the balance sheet, we don't we're not contemplating major cuts The CapEx here over the next 12 months and we do still have a lot of projects in flight that are spilling over.

Speaker 2

I'd welcome Ray or Sean to kind of add to that if they've got other thoughts on that.

Speaker 1

No, nothing to add, Chris.

Speaker 7

Okay. So Chris, would it be then fair to say that 2024 CapEx Should be actually similar to 2023, if not higher. Is that directionally the right way to think about it?

Speaker 2

Yes. We'll release our CapEx guidance when we put our year end financials out just as we put our shipment guidance for next year out at that same point in time. And so that's when we'll be driving CapEx for the next year, but there is we started with a range of $500,000,000 to $600,000,000 this year and We're saying that there's probably 50 to 100 that's going to spill over into next year as carryover on top of maintenance and the other stuff that we wouldn't ordinarily do next

Speaker 7

Got it. No, that's fair. Maybe then shifting to capital allocation, obviously, balance sheet Is in a very strong position. You've got a lot of it's sitting on quite a bit of net cash. Can Can you talk about one sort of how is your M and A pipeline looking at this point?

Speaker 7

Have seller expectations moderated given what we've seen so far this year? And then on the other side, how you think about sort of appetite for kind of larger share repurchases? Thank you.

Speaker 2

I can start there and then if Ray wants to jump in Ken as well too. On the M and A front, There's been a number of active years. I think participants in the industry understand that there's cycles here and Valuations don't really sort of wildly adjust whether you're in a soft market or a frothy market It's really about asset quality, which has been of particular importance to us in the last few years when you look at our strategy around how we've deployed capital. So, there's always stuff happening for us as Ray said earlier, we're going to be quite selective around The opportunities that we action because they need to be high quality opportunities and we believe we're positioned with the balance sheet that if those opportunities are there, we're well positioned Take advantage of those high quality opportunities. On the share buybacks, there's lots of things that Impact that decision process including our view on the macro environment.

Speaker 2

We're not going to commit to where and when and how many On a call like this, but we can say when it's at a discount to intrinsic, when the balance sheet is where we want it to be and when our other Priority uses of cash are met. We have that opportunity to return capital through the buybacks and our track record shows that we do that. So I think that's about all that we would say on share buybacks.

Speaker 7

That's fair. Appreciate the thoughts. I'll turn it over. Thank you.

Operator

There are no further questions at this time. Please proceed.

Speaker 1

Thank you, everyone, and thanks. And as always, Chris, Robert, Sean and I are available to respond. Thank you for your participation and like you all look

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Key Takeaways

  • West Fraser generated $325 million of consolidated adjusted EBITDA in Q3, up from $80 million in Q2, driven by price strength in North American OSB and improved results across lumber and pulp.
  • The company announced planned sales of three pulp mills (Hinton, Slade Lake and Cornell) set to close in early 2024 and the CAD 140 million acquisition of Spray Lake Sawmills in Alberta, aligning its portfolio with a focus on wood building products.
  • West Fraser reiterated guidance for North American OSB and SPF shipments but lowered its Southern Yellow Pine outlook amid cooling U.S. South demand. It now expects European OSB shipments to be near the low end of the 1.0–1.2 billion board feet range.
  • Third-quarter operating cash flow was $355 million, driving net cash to $663 million. The company repurchased $78 million of shares and cut 2023 capital spending guidance to approximately $450 million.
  • Sean McLaren will succeed Ray Farris as President and CEO effective January 1, 2024, marking a leadership transition after nearly 20 years of collaboration.
A.I. generated. May contain errors.
Earnings Conference Call
West Fraser Timber Q3 2023
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