Canfor Pulp Reports Results for Third Quarter of 2020

Overview
• Third quarter of 2020 reported operating loss of $28 million; net loss of $18 million, or $0.28 per share
• Strong balance sheet maintained, net debt to capitalization of 3.4% at September 30, 2020

The Company reported an operating loss of $27.6 million for the third quarter of 2020, compared to an operating loss of $6.3 million reported for the second quarter of 2020. After adjusting for a $3.0 million recovery in its inventory write-down provision, the Company’s operating loss was $30.6 million for the third quarter of 2020, $32.5 million unfavourable compared to similarly adjusted results for the second quarter of 2020.

The Company’s operating results for the third quarter of 2020 reflected weak global pulp market conditions as well as significant fibre-related and previously deferred scheduled maintenance downtime, stemming from the ongoing impact of the coronavirus (“COVID-19”) outbreak, combined with a 3 cent, or 4%, stronger Canadian dollar. The significant effect of COVID-19 on lumber sawmill operating rates in the British Columbia (“BC”) Interior in the previous quarter materially impacted residual fibre supply to the Company’s Prince George (“PG”) based operations heading into the current quarter, resulting in a four-week curtailment at the Company’s Intercontinental Northern Bleached Softwood Kraft (“NBSK”) pulp mill and PG NBSK pulp and paper mill in July.

Global pulp market conditions were weak during the current quarter, with the ongoing sharp decline in demand for printing and writing papers offsetting improved demand for tissue products. Global softwood pulp producer inventories at the end of August 2020 remained significantly above the balanced range at 43 days of supply, an increase of one day supply compared to June 2020.
details at: https://www.canfor.com/docs/default-source/news-2020/2020_q3_cppi_press_release.pdf?sfvrsn=8804ee91_2

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