Conifex Announces 2025 Year-End and Fourth Quarter Results

Executive Summary

• Conifex Timber reported a full‑year 2025 net loss of $35.7 M ($0.87 per share) and Q4 loss of $11.4 M ($0.28 per share), widening versus the prior year.
• EBITDA from continuing operations was negative $27.5 M for 2025 (Q4: –$12.6 M), reflecting higher duty/tariff costs and reduced production rates.
• The company disclosed significant soft‑wood lumber duty and tariff expenses ($26.1 M in 2025, a 493% increase YoY) and announced new financing: a $5 M bridge advance (Feb 2026) and a $19 M secured term loan under the BDC Softwood Lumber Guarantee Program (Mar 2026).

Key Details

• Financial Highlights – FY 2025 vs. 2024
• Revenue: $101.0 M (up 7% YoY); Q4 revenue $15.8 M (down 40% QoQ, down 25% YoY).
• Lumber production: 147.9 MMfbm (annualized rate 62%).
• Shipments: 141.1 MMfbm (+3% YoY).
• Bioenergy electricity sold: 179 GWh (+8% YoY); Q4 55.3 GWh (+23% QoQ).

• SG&A costs: $5.8 M (‑19% YoY).

• Duty & Tariff Impact

• CVD/ADD deposits expensed: $26.1 M in 2025 vs. $4.4 M in 2024.
• Combined duty/tariff rate reached 45.16% after AR6 finalization (Sept 2025) and Section 232 tariff (Oct 14 2025).

• Cash deposits paid 2025: $10.8 M; net duty expense 2025: $26.1 M.

• Liquidity & Debt

• Total debt at 31‑Dec‑2025: $87.7 M (Pender Term Loan $40.4 M, Power Term Loan $47.3 M).
• Available unrestricted cash: $4.4 M (up from $3.6 M year‑end 2024).

• New financing:

  • $5 M bridge advance under Pender Term Loan (Feb 2026).
  • $19 M secured term loan with BDC (Mar 2026), interest = BDC floating base –0.60%, maturity 15‑Oct‑2033; portion used to repay bridge advances.

• Going‑Concern Disclosure

• Management acknowledges material uncertainty regarding ability to continue as a going concern, citing high duty/tariff burden and reliance on additional financing.

• Waiver of September 2025 principal payment on Power Term Loan; December 2025 payment deferred.

• Outlook & Operational Adjustments

• Anticipates reduction in duty rates in Q4 2026 after seventh administrative review.
• Plans to adjust operating format (potential two‑shift operation) and defer non‑essential capex to preserve liquidity.

Notable Quotes

“We continue to review our options to improve liquidity… securing a $5 million bridge advance and entering into a $19 million secured term loan demonstrates our proactive approach to maintaining financial flexibility.” – Trevor Pruden, CFO

All forward‑looking statements are subject to risks and uncertainties detailed in the release.