West Fraser Timber Co. Ltd. has reported Q1/2016 net earnings of C$42 million, down from the C$49 million in the same 2015 quarter.
The integrated company whose products include lumber, plywood, pulp and newsprint among others, reported that the revenues on sales advanced to C$1.077 billion from C$1.014 million in the Q1/2015.
West Fraser's lumber operations generated operating earnings of C$63 million, up from C$17 in the Q4 of 2015, as a result of the higher prices and shipments combined with a weaker Canadian dollar. Also, the lumber markets improved slightly as generally milder weather conditions produced above normal home building activity in many parts of the U.S.
West Fraser's panel segment, which includes plywood, LVL and MDF, generated operating earnings of C$12 million, down from C$16 million in the Q4/2015, mostly reflecting weakening plywood and MDF prices.
Meanwhile, pulp and paper operations generated operating earnings of C$5 million compared with operating earnings of C$8 million in the previous quarter. Pulp results benefitted from a weaker Canadian dollar as the U.S. dollar-denominated pulp prices, which were relatively stable in the quarter. This benefit was offset by increased maintenance costs at the Hinton pulp mill, the result of a minor maintenance shutdown during the period.
"We have made significant investments in growth, capital and innovation, and we are starting to see the benefits of the most comprehensive five- year capital plan in our history. We are geographically diversified and have a modern and efficient group of assets which positions us well in addressing any trade sanctions arising from the dispute,” stated Ted Seraphim, President and CEO of West Fraser.