West Fraser Timber Co. Ltd. today reported earnings for the second quarter of 2012 of $27 million and earnings per share of $0.63 on sales of $774 million. For the first half of 2012, earnings were $10 million and earnings per share were $0.24, on sales of $1.5 billion.
In the quarter the lumber segment generated operating earnings of $34 million and EBITDA of $53 million. Lumber prices rallied strongly as improved U.S. demand combined with continuing Asian demand for Canadian lumber. Higher lumber prices also triggered a reduction in duties (from 15% to 10%) charged on softwood lumber exported to the U.S. from B.C. and Alberta for the month of June 2012.
The panels segment, which includes plywood, LVL and MDF, generated operating earnings in the quarter of $8 million and EBITDA of $12 million. Improved plywood and MDF prices were the main contributors.
Pulp and paper operations generated operating earnings of $14 million and EBITDA of $26 million. The average NBSK benchmark price for the quarter increased to US$900 per tonne from US$870 in the previous quarter but reduced NBSK production and shipments and increased chemical costs resulted in a marginal decline in operating earnings compared with the previous quarter.