Weyerhaeuser Company and West Fraser Timber Co Ltd’s third quarter results have shown there remains no sign of an improvement in the market as the industry continues to go through an “unprecedented” trading period.
Weyerhaeuser’s timberlands contributed US$107m to pre-tax earnings in the quarter, down from US$163m in 2007. Wood products recorded a loss of US$146m, further down on a loss of US$131m last year.
Although timberlands and wood products contributions were up on the second quarter, Weyerhaeuser said this improvement would stop in the fourth as seasonal declines and weak demand from the US housing market continue.
Canadian firm West Fraser also said it was not expecting any significant change in its market situation as it announced its third quarter results.
The company reported sales for the quarter up C$21m to C$848m with the lumber division’s EBITDA increasing from a loss of C$27m to C$29m as log costs fell and net inventory adjustments declined. However, EBITDA in its panel operation fell from C$19m to C$5m in the quarter, with LVL and MDF production curtailments and the declining Canadian plywood market hitting its panel business.
“Our results continue to reflect very challenging times,” said chairman, president and chief executive officer Hank Ketcham.
“The nature and length of this downturn is unprecedented for our industry.
“Given the current state of the US financial and credit markets, we do not see any significant improvement in the near term,” he added.
