Residential construction market pushes Canfor to hefty profits in Q4

Canadian lumber and pulp producing giant Canfor reported fourth quarter 2020 sales of 1.62 billion Canadian dollars (US$1.30 billion), rising more than 45% from sales of C$1.12 billion (US$881 million) in the fourth quarter a year ago.

Total lumber shipments of 1.56 billion board feet were up 14% from the previous quarter as a backlog of orders tied to strong demand in North America in the third quarter of 2020 was alleviated, the company said.

Total lumber production, at 1.46 billion board feet, was up 3% from the previous quarter.

Sales for the full year increased 17% to C$5.45 billion (US$4.37 billion). 

The Vancouver, British Columbia-based company posted a net income of C$355.6 million (US$285 million), seeing a huge swing from a net loss of C$39.1 million (US$31.33 million) for the same period a year ago.

For the full year, Canfor reported a net income of C$544.4 million (US$436.18 million). The company reported a net loss of C$263 million (US210.72 million) in 2019.

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The Bottom Line: A strong North American residential construction market helps push Canfor to a net income of C$355.6 million in the fourth quarter compared to a net loss of C$39.1 million in the previous fourth quarter. 

What the CEO said: “Despite such a difficult start to the year, which weighed heavily on the results for our pulp business, we were very pleased to see an unprecedented surge in global lumber markets beginning in the second quarter and continuing through the balance of the year,” said Don Kayne, Canfor president and CEO. 

“Supported by the strong performance of our operations, we were able to generate new record-high financial results for 2020. As we move into 2021, we expect to see continued strength in global lumber demand and along with improving conditions for global pulp markets, this should ensure another solid financial year for Canfor, despite the ongoing challenges of the global pandemic,” Kayne said.

Company info: Click here to read the full fourth quarter 2020 report from Canfor.