Conifex Announces Third Quarter 2025 Results

Executive Summary

• Conifex Timber reported Q3 2025 EBITDA of ‑$16.6 M, a significant decline from the prior quarter (‑$3.2 M) and from Q3 2024 (‑$3.9 M).
• Net loss widened to $16.6 M ($0.41 per share), more than double the loss in Q2 2025 and over four times the loss a year earlier.
• Liquidity remains constrained with only $1.7 M of unrestricted cash, while overall debt rose to $82.6 M, reflecting additional draws on term loans and higher soft‑wood lumber duty deposits.

Key Details

• Financial Highlights (unaudited) – Q3 2025 vs. prior periods
• Sales: $38.2 M (down 4% QoQ, up 38% YoY).
• Operating income (loss): ‑$19.5 M.
• EBITDA: ‑$16.6 M (vs. ‑$3.2 M Q2 2025; ‑$3.9 M Q3 2024).
• Net loss: $16.6 M ($0.41/share); prior quarter loss $8.3 M ($0.20/share).
• Production & Shipments
• Lumber production: 38.5 MMfbm (≈64% of annualized capacity), +9% QoQ, +22% YoY.
• Shipments: 40.1 MMfbm, +3% QoQ, +37% YoY.
• Bioenergy
• Electricity sold: 47.6 GWh (≈88% of target operating rate).
• Bio‑energy revenue: $7.0 M (up from $3.6 M Q2 2025).
• Cost Structure
• Cost of goods sold ↑19% QoQ, driven by higher production volume and a $1.2 M inventory write‑down.
• SG&A expenses modestly down to $1.4 M (vs. $1.5 M Q2 2025).
• Finance costs rose to $4.4 M due to non‑cash interest adjustments from higher duty rates and additional term‑loan draws.
• Duty & Tariff Impacts
• Countervailing/anti‑dumping duty deposits expensed: $15.3 M in Q3 2025 (vs. $2.0 M Q2 2025).
• Cumulative US soft‑wood lumber duties deposited: US$44.1 M (net of sales).
• Liquidity & Debt
• Total debt: $82.6 M (up from $81.6 M Q2 2025).
  • Power Term Loan outstanding: $47.2 M.
  • Pender Term Loan outstanding: $32.7 M (increased by $2 M draw).
• Unrestricted cash/liquidity: $1.7 M (down from $3.0 M Q2 2025).
• Going‑Concern Assessment
• Management disclosed material uncertainty regarding ability to continue as a going concern, citing higher duty rates and limited liquidity.
• Financing Activities & Outlook
• Lender increased Pender Term Loan availability by $1 M (now ~$36 M) with repayment due Jan 26 2026.
• Company pursuing Canadian Softwood Lumber Guarantee Program funding and potential non‑core asset sales to bolster cash flow.
• Cost‑saving measures underway; possible operational scaling of Mackenzie mill under review.
• Conference Call
• Scheduled for Friday, Nov 14 2025 at 8:00 AM PT / 11:00 AM ET (passcode 13755952#).

Notable Quotes

“We continue to work collaboratively with our lenders to obtain additional accommodations and are actively pursuing financing opportunities through the federal Softwood Lumber Guarantee Program, while also evaluating non‑core asset sales to improve liquidity.” – Trevor Pruden, CFO

Materiality Assessment: Material – Negative (significant deterioration in earnings, cash position, and heightened going‑concern risk).