Acadian Timber TSE: ADN reported lower revenue, adjusted EBITDA and net income for the second quarter of 2026, as seasonal operating conditions and elevated customer inventories reduced sales volumes. Management said operational improvements in Maine began to benefit costs during the quarter, while it expects New Brunswick sales volumes to recover as customer inventories normalize.
The company generated $14.6 million in revenue for the quarter ended June 27, down from $17.1 million a year earlier. Adjusted EBITDA totaled $1.3 million, compared with $2.4 million in the second quarter of 2025, while net income was $1.3 million, or $0.07 per share, versus $2.7 million, or $0.15 per share, a year earlier.
Susan Wood, Acadian Timber’s chief financial officer, said the second quarter is typically the company’s lowest production period because of seasonal conditions. This year, volumes were further affected by high customer inventories following a productive winter, particularly in New Brunswick.
Higher Prices Partly Offset Volume Declines
Revenue declined primarily because of lower volumes, though the impact was partly offset by a 19% increase in the company’s weighted average selling price. Wood said stronger softwood lumber markets, higher fuel surcharges and longer hauling distances contributed to the higher average selling price.
Operating costs and expenses declined by $1.7 million from the prior-year period. The decrease reflected lower sales volumes, operating efficiencies that began taking effect in Maine during the quarter, and lower selling and administrative costs. Those benefits were partly offset by higher fuel adjustment costs and longer hauling distances.
Net income also reflected lower operating income, higher interest expense and higher income tax expense compared with the same quarter last year, Wood said. Higher non-cash fair-value adjustments partially offset those factors.
- New Brunswick freehold sales volumes fell 38% year over year.
- New Brunswick sales totaled $12 million, down from $14.4 million, while adjusted EBITDA declined to $2.1 million from $4 million.
- Maine freehold sales volumes decreased 31% as the company reduced internal harvesting activity.
- Maine sales were $2.6 million, compared with $2.7 million a year earlier, while adjusted EBITDA improved to a loss of $400,000 from a loss of $900,000.
In New Brunswick, the weighted average selling price excluding biomass increased 19%. Variable costs were also affected by higher fuel costs and longer hauling distances.
In Maine, the weighted average selling price rose 16%, supported by a higher-value product mix, fuel surcharges and longer hauls. Cost of sales per cubic meter produced decreased 7%, as operational efficiencies outweighed, but did not eliminate, pressure from fuel costs and transportation distances.
Maine Harvesting Overhaul Shows Early Progress
Malcolm Cockwell, Acadian Timber’s chair, interim president and chief executive officer, said the company made significant changes to its internal harvesting operations in Maine during the second quarter.
Acadian established internal harvesting operations in early 2025 to address reduced regional harvesting and trucking capacity, rising harvesting and trucking costs, and forest conditions requiring modern cut-to-length equipment. Cockwell said results from those operations were poor throughout 2025.
During the second quarter, the company shifted its focus from maximizing production volume to reducing the cost per cubic meter produced. It scaled its internal operations to its most productive operators and equipment, improved equipment-data flows to identify production bottlenecks, increased use of machine optimization software, and adjusted equipment deployment and harvest-block selection.
The company also reduced fixed costs in Maine and said it intends to use internal harvesting where it offers an advantage while relying on third-party contractors where their equipment or capabilities are more beneficial.
“While Maine did not achieve profitability during the quarter, the year-over-year improvement in Adjusted EBITDA demonstrates that these operational changes are progressing in the right direction,” Cockwell said. He added that Acadian expects stronger Maine results through the remainder of 2026 compared with 2025.
Outlook Includes Normalizing Inventories and Soft Pulpwood Conditions
Management said its outlook for the remainder of 2026 is positive. In New Brunswick, elevated customer roundwood inventories that constrained second-quarter deliveries have returned to more normal levels, and Acadian expects sales to match harvesting capacity. The company also expects sufficient contractor availability in New Brunswick through the year.
Acadian expects sawlog demand to remain relatively stable in the near term, although pricing could face pressure until end-use markets improve. Pulpwood demand and pricing in both New Brunswick and Maine are expected to remain soft until current customers increase output or new pulpwood- and biomass-consuming facilities begin operations.
Cockwell said management is encouraged by forecasts for steady U.S. housing starts and by temporary and permanent curtailments at forest-products facilities elsewhere in North America, which it expects to support demand and pricing for Acadian’s customers. However, he said tariffs, duties and higher fuel costs continue to pressure customers’ operations. Acadian had not seen significant customer curtailments in New Brunswick or Maine so far in 2026.
The company ended the quarter with $15 million of net liquidity, including cash and available credit capacity net of required minimum balances. Acadian has $45 million of long-term debt scheduled to mature in March 2027 and said it intends to refinance that debt before maturity.
Renewable Energy, Carbon and Real Estate Initiatives
During the question-and-answer session, Cockwell said a newly signed renewable-energy option and lease is expected to provide modest, accretive income initially. If the related project is developed, he said the economics could become substantially more favorable in roughly four to five years and could last for decades.
He also said meteorological data collected in New Brunswick has been useful and that Acadian is engaged with potential project proponents, though it is too early to provide specifics.
Demand and pricing for carbon credits remain stable, according to management. The next issuance from Acadian’s current carbon-credit project has been delayed by the transition to ACR’s updated improved forest management protocol. The company now expects registration in the second half of 2026 and believes the new protocol will improve the credits’ marketability.
Acadian is also advancing a residential development project in Maine. Cockwell said the project remains on track to become substantially shovel-ready by the end of 2026 and could be in a revenue-generating position in 2027. He described the project as potentially material to the Maine business over several years.
About Acadian Timber (TSE:ADN)
Acadian Timber Corp is a Canada-based supplier of primary forest products in Eastern Canada and the Northeastern United States. The company's operating segments include NB Timberlands and Maine Timberlands. It generates maximum revenue from the NB Timberlands segment. The company's product includes softwood and hardwood sawlogs, pulpwood and biomass by-products.
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