Western Forest Products Reported 15% Surge in Q4 Earnings

SEATTLE (Scrap Monster):  Western Forest Products, Inc. (WFP) has reported the operating results for Q4 2017 and fiscal 2017 year-end results. The company reported adjusted EBITDA of $38.9 million in the fourth quarter of the previous year, higher by 15% when compared with the EBITDA of $33.8 million in the fourth quarter of 2016. The total revenue dropped marginally over the year from $293 million to $283.1 million. The average lumber price realization increased 8% in fourth quarter of 2017, whereas the lumber shipments dropped by 13% over the year.

The lumber revenue during the quarter has dropped by nearly 6% from Q4 2016 to $207.3 million in the fourth quarter of 2017. The quarterly log revenue reported a jump of 3% to total $56.6 million. The lumber production by WFP dropped considerably to 187 million board feet during Q4 ’17, mainly due to reduced operating hours reported at its Saltair, Ladysmith and Alberni Pacific sawmills on account of constrained log supply.

For the fiscal year 2017 ended 31^st December, the company reported adjusted EBITDA of $152.6 million as compared with $148.2 million in 2016. Meantime, the annual revenue declined marginally from $1,187.3 million during the prior year to $1,143.4 million in 2017.

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In 2017, WFP reported lumber revenue of $858.2 million, less by 3% over the prior year. At the same time, log revenue declined by 9% to total $214.8 million. The full year lumber production dropped sharply from 943 million board feet in 2016 to 89 million board feet in 2017. The drop in production was mainly on account of huge drop in coastal log production on account of severe weather conditions.

The company foresees continued strong demand for lumber from both the US and China, which in turn will support lumber prices. The pricing for pulp logs is expected to increase over the near term, backed by robust demand growth. The company will continue to strengthen its operating platform through strategic investments, said Don Demens, President and CEO, WFP.