VANCOUVER, April 28, 2020 - West Fraser Timber Co. Ltd. ("West Fraser" or the "Company") (TSX: WFT) today reported results for the first quarter of 2020.
First Quarter Highlights
- Sales of $1.195 billion, up 6% on prior quarter.
- Adjusted EBITDA of $127 million, $47 million higher than prior quarter.
- Improved prices, favourable foreign exchange rate movements, and lower fibre costs resulted in improved Adjusted EBITDA for the quarter.
- Quarter-end liquidity of $294 million and net debt to capital ratio at 33%.
- On April 9, 2020, secured an additional two-year $150 million committed revolving credit facility.
- Progress on Dudley, Georgia sawmill on track.
The impact of the novel Coronavirus ("COVID-19") pandemic has been swift, requiring unprecedented actions to control the spread of the virus and has resulted in governments and businesses worldwide enacting emergency measures and restrictions to combat the spread of COVID-19. These measures and restrictions, which include the implementation of travel bans, mandated or voluntary business closures, and self-imposed and mandatory quarantine periods, isolation orders and social distancing have caused material disruptions to businesses globally resulting in an economic slowdown and have led to disruptions to our workforce and operating facilities, customers, production, sales and operations, and supply chain. Governments and central banks have reacted with significant monetary and fiscal interventions and other measures designed to stabilize economic conditions. The duration and impact of the COVID-19 outbreak are unknown at this time, as is the effectiveness of governments and central banks measures to stabilize the economy and limit the spread of COVID-19. At this time, it is not possible to reliably estimate the length and severity of these developments and the impact on our operations, the markets for our products, and our financial results and condition.
As a result of the far-reaching impact of COVID-19, we have made a number of adjustments to our operating schedules late in the first quarter of 2020. The impact of these adjustments on our first quarter production was a reduction of approximately 50 MMfbm for lumber and 10 MMsf for plywood. The "Outlook" section below includes commentary on potential future operating schedules.
Ray Ferris, President and CEO of West Fraser stated, "The safety, health, and well-being of our employees and the communities in which we operate remain our primary focus. Our goal is to operate safely and to mitigate potential exposure. As such, we have implemented physical distancing strategies, increased cleaning and disinfection at our sites, provided protective equipment as required, executed remote working policies, and eliminated all non-essential travel."
Source: West Fraser
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