Canfor reports results for the third quarter of 2025
Executive Summary
- Canfor reported a material operating loss of C$208.3 M and net loss of C$172.4 M for Q3 2025, equating to C$1.48 per share, reflecting continued weakness in global lumber and pulp markets.
- Adjusted operating loss (after one‑time items) was C$111.3 M, up from C$44.0 M in the prior quarter, driven by inventory write‑downs, duty expenses on softwood lumber duties, and higher restructuring costs.
- Management warned of ongoing economic uncertainty, trade tensions, and potential covenant breach risk for its pulp subsidiary due to a scheduled maintenance outage and weak market conditions.
Key Details
- Financial Highlights (C$ millions)
- Sales: 1,259.8 (down from 1,379.4 in Q2 2025).
- Reported operating loss: (208.3) vs. (251.4) in Q2 2025.
- Net loss: (172.4) vs. (202.8) in Q2 2025.
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Net loss per share (basic & diluted): $1.48 vs. $1.71 prior quarter.
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Adjustments & One‑Time Items
- Total adjusting and one‑time items: C$97.0 M (inventory write‑down, duty expense on final CVD/ADD rates).
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Adjusted operating loss before one‑time items: (111.3) vs. (44.0) in Q2 2025.
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Lumber Segment
- Operating loss: C$182.2 M (improved from C$229.2 M prior quarter).
- Adjusted operating loss after one‑time items: C$90.1 M vs. C$24.7 M in Q2 2025.
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No restructuring/closure costs recognized in Q3 2025 (previous quarters had $6.7–$36.5 M).
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Pulp & Paper Segment
- Operating loss: C$16.0 M vs. C$5.3 M prior quarter.
- Adjusted operating loss after inventory write‑down: C$11.1 M.
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NBSK pulp price to China: US$690/tonne, down US$44 (≈6%) QoQ.
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Duty Expenses
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Net duty expense for final CVD and ADD rates (POR 6): C$77.2 M (US$56.2 M).
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Outlook & Risks
- Lumber markets expected to remain weak through year‑end; Section 232 tariffs to add pressure in Q4 2025.
- Pulp market projected weak; scheduled maintenance at Northwood NBSK mill will cut production by 10,000 t in Q4 2025, raising risk of covenant non‑compliance as early as Dec 31 2025.
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Management is pursuing cost reductions and deferring capex; negotiating with lenders for a possible waiver.
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Conference Call
- Date/Time: Thursday, Nov 6 2025, 9:00 AM PT.
- Toll‑Free: 1‑888‑510‑2154 (passcode 75985#).
Notable Quotes
“The ongoing global economic and trade uncertainty… led to persistently weak market conditions and subdued demand… We remain focused on the areas within our control—ensuring safe and efficient operations, maintaining disciplined cost management and delivering quality products.” – Susan Yurkovich, President & CEO
“Global economic uncertainty is also adversely affecting pulp and paper market fundamentals… we expect these economic challenges to persist.” – Susan Yurkovich