Conifex Announces Second Quarter 2025 Results

Executive Summary

• Conifex Timber Inc. reported a net loss of $8.3 million ($0.20 per share) for the second quarter ended June 30, 2025, compared to a net income of $0.6 million in the previous quarter and a net loss of $9.7 million in the same period last year.
• EBITDA turned negative at -$3.2 million for Q2 2025, down from $4.9 million in Q1 2025 and -$7.1 million in Q2 2024, driven by reduced lumber production volumes and lower market prices.
• The company faces significant liquidity constraints with only $3.0 million in available cash at June 30, 2025, and is actively evaluating financing options, including additional debt facilities or asset sales, to fund working capital and duty deposits.

Key Details

• Financial Performance (Q2 2025):
  • Net Loss: $8.3 million ($0.20 diluted loss per share).
  • EBITDA: -$3.2 million.
  • Operating Income: -$4.5 million.
  • Total Sales: $33.9 million (Lumber: $27.4M; By-products: $2.9M; Bioenergy: $3.6M).
  • SG&A Costs: $1.5 million.
  • Finance Costs: $2.4 million.
  • Income Tax Expense: $0.8 million.
• Operational Metrics:
  • Lumber Production: 35.3 million board feet (MMfbm), representing ~59% of annualized capacity; a 24% decrease from Q1 2025 due to reduced log availability and four-day mill configuration.
  • Lumber Shipments: 38.9 MMfbm, a 2% increase from Q1 2025.
  • Electricity Production: 29.6 GWh, down from 47.6 GWh in Q1 2025 due to a six-week annual maintenance shutdown.
  • Average Lumber Price (WSPF 2x4 #2 & Btr): $471 US / $651 CAD.
• Liquidity and Debt:
  • Total Debt: $81.6 million (Power Term Loan: $47.2M; Pender Term Loan: $31.5M; Leases: $2.9M).
  • Available Liquidity: $3.0 million (unrestricted cash).
  • Working Capital: $12.1 million.
  • Cash Flow from Operations: $6.8 million (after adjustments for working capital items).
• Duties and Trade:
  • Expensed Countervailing (CV) and Anti-Dumping (AD) duty deposits: $2.0 million in Q2 2025.
  • Cumulative duties held in trust: US$41.7 million.
  • Duty rate increased from 8.05% to 14.4% in September 2024.
• Subsequent Events:
  • Entered into a letter of undertaking to repay $500,000 of a $3.5 million advance in early July 2025, followed by $150,000 monthly payments until the advance is repaid.
• Outlook:
  • Company expects to sustain two-shift operations through the balance of 2025.
  • Acknowledges heightened uncertainty regarding market conditions, tariffs, and rising softwood lumber duty rates.