Western Announces Third Quarter 2025 Results

Executive Summary

• Western Forest Products reported a material deterioration in Q3 2025 Adjusted EBITDA to a loss of C$65.9 million (‑28% margin) versus a small profit in the prior quarter, driven largely by a non‑cash export duty expense of US$59.5 million from the sixth Administrative Review.
• Net loss widened to C$61.3 million for Q3 2025, with diluted loss per share of $5.71, reflecting higher operating losses and increased debt service costs.
• The company announced a new USD 30 million letter‑of‑credit facility, reduced net debt to C$11.6 million (2% of capitalization), and provided guidance on capital projects (two continuous dry kilns slated for early‑mid 2026) while highlighting ongoing labor dispute and insurance recovery matters.

Key Details

• Financial Performance
• Revenue Q3 2025: C$233.0 M (down from C$241.7 M YoY).
• Adjusted EBITDA Q3 2025: –C$65.9 M (‑28% margin) vs. –C$10.7 M in Q3 2024 and +C$0.5 M in Q2 2025.
• Net loss Q3 2025: C$61.3 M vs. C$19.6 M YoY; diluted loss per share $5.71.
• Net debt end‑Q3 2025: C$11.6 M (down $15.7 M from Q2); net‑debt‑to‑capitalization 2% (improved from 5%).

• Liquidity at quarter‑end: C$234.2 M, up from C$189.7 M in Q2 2025.

• Operational Metrics

• Lumber production: 107 M board feet (down from 127 M Bf YoY).
• Lumber shipments: 129 M Bf (down from 138 M Bf YoY).
• Cedar lumber shipments: 24 M Bf vs. 33 M Bf YoY.
• Specialty lumber mix: 51% of output (vs. 53% YoY).
• Average lumber selling price: $1,409 per mfbm (up from $1,378 YoY).

• Average BC log sales price: $160 per m³ (up from $113 YoY).

• Capital Projects

• Ongoing construction of two continuous dry kilns; first expected early 2026, second mid‑2026.

• FY 2025 capital expenditure reduced to $30–$35 M, with ~C$16 M allocated to the kilns.

• Balance Sheet & Financing

• New USD 30 M letter of credit added to existing $250 M syndicated credit facility.

• Working‑capital reductions contributed to net‑debt decline.

• Other Items

• Recorded US$5.0 M (C$6.9 M) other income from initial insurance recovery for Columbia Vista sawmill fire.
• Ongoing strike at La‑kwa sa muqw Forestry Ltd. partnership; negotiations ongoing.

• Production curtailments: 30 M Bf in Q3 2025, planned 35 M Bf in Q4 2025.

• Regulatory & Trade Impacts

• US DoC final antidumping duty (20.53%) and countervailing duty (14.63%) for sixth AR resulted in non‑cash export tax expense of US$44.1 M plus accrued interest of US$8.2 M.

• New 10% Section 232 tariff on imported lumber effective Oct 14 2025 adds further cost pressure.

• Market Outlook

• Weak North American demand expected to persist due to high rates, low consumer confidence, and elevated inventory levels; modest improvement anticipated late Q4 2025 or early 2026.

• Japan/China housing demand down but lumber inventories low, keeping pricing stable in the short term.

• Conference Call

• Thursday, Nov 6 2025 at 9:00 a.m. PST (12:00 p.m. EST).

Notable Quotes

(No direct quotes were provided in the release.)