GreenFirst Reports Financial Results for the Second Quarter of 2025

Executive Summary

• GreenFirst Forest Products reported a net loss of $9.6 million ($0.42 diluted loss per share) for Q2 2025, a significant deterioration from the $0.9 million net income recorded in Q1 2025.
• The company recorded a substantial non-cash duty expense of approximately US$19 million ($26 million CAD) related to the US DOC’s Final Determination of the Sixth Administrative Review, which will be recognized in Q3 2025.
• Despite a negative Adjusted EBITDA of $5.2 million in Q2, the company achieved record production volumes of 115,000 mfbm and increased net sales by approximately 18% to $84.5 million compared to Q1.

Key Details

• Financial Performance (Q2 2025 vs Q1 2025):
  • Net Loss from continuing operations: $9.6 million ($0.42 diluted loss per share) vs. Net Income of $0.9 million ($0.04 diluted earnings per share).
  • Adjusted EBITDA from continuing operations: Negative $5.2 million vs. Positive $5.1 million.
  • Net Sales: $84.5 million (up ~18% from Q1’s $71.8 million).
  • Cost of Sales: $80.1 million (up ~29% from Q1).
  • SG&A Expenses: $4.6 million (up from $2.6 million in Q1, driven by non-cash compensation and professional services).
  • Duties Expense: $8.3 million in Q2 (up from $5.7 million in Q1).
• Balance Sheet (As of June 28, 2025):
  • Total Assets: $216.1 million.
  • Total Liabilities: $77.3 million.
  • Total Shareholders' Equity: $138.8 million.
  • Cash on Hand: $4.4 million.
  • Revolving Credit Facility: $39.8 million available (less $8.1 million standby letters of credit); $12.5 million drawn.
  • Equipment Financing: $12.7 million remaining access; $12.3 million drawn (net of repayments).
• Operational Metrics:
  • Sales Volume: ~110,000 mfbm (up from ~90,000 mfbm in Q1).
  • Production Volume: 115,000 mfbm (record high for continuing operations).
  • Realized Lumber Price: $712 per thousand board feet (mfbm), down from $729/mfbm in Q1.
• Regulatory & Trade Updates:
  • US DOC Final Determination (Sixth Administrative Review) assessed a duty rate of 35.19% for 2023 imports.
  • Company to record a non-cash duty expense of ~US$19 million ($26 million CAD) plus accrued interest in Q3 2025.
  • Cash deposits paid to date remain held in trust by the US DOC.
• Project Updates:
  • Collaboration with Chapleau large log line supplier continues; project remains on schedule and within budget.
  • New production line expected to enhance productivity, reduce unit costs, and deliver EBITDA benefits starting in 2026.
  • Project supported by anticipated government funding.
• Outlook:
  • Macroeconomic concerns stabilizing; housing market showing signs of recovery.
  • Mortgage rates expected to ease in 2025, potentially improving affordability and demand.
  • Supply constraints persist in Western Canada due to wildfires and regulatory limits, supporting tighter supply conditions.
  • SPF lumber prices rebounded ~8-10% year-to-date in 2025.

Notable Quotes

• "Despite market uncertainty, we finished Q2 2025 with higher sales volumes compared to Q1 2025... We recorded a negative EBITDA of $5.2 million in Q2 2025, primarily due to lower selling prices and higher lumber costs associated with inventory produced in Q1 2025," said Joel Fournier, GreenFirst's Chief Executive Officer.
• "On a positive note, GreenFirst set a new high during the quarter in terms of production records with volume reaching 115,000 mfbm, the highest in Company history for continuing operations."