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- **Q3 EBITDA Loss**: $144 million negative adjusted EBITDA driven by $67 million duty expense and soft demand.
- **Production Curtailment**: 20-25% lumber and 80% OSB operating rates in Q4 to match demand.
- **Balance Sheet Strength**: $212 million net cash and $1.2 billion liquidity support countercyclical investments.
- **Tariff Challenges**: 26.5% duty rate plus new 10% Section 232 tariffs pressure margins.
- **Operational Flexibility**: Agile asset management and working capital discipline maintain resilience.

**【CEO Summary Section】**
- West Fraser reported negative $144 million adjusted EBITDA for Q3 2025, driven by $67 million out-of-period duty expense and soft demand across lumber and OSB products.
- Lumber segment EBITDA was negative $123 million, reflecting lower pricing and AR6 duties. North American OSB EBITDA was $15 million, down from $68 million in Q2 due to lower pricing.
- Company maintained strong balance sheet with $212 million net cash and $1.2 billion available liquidity, enabling countercyclical investments.
- Management emphasized operational flexibility, with Q4 lumber production curtailed by 20% to 25% to align with demand.

**【CFO Financial Commentary】**
- Q3 cash flow from operations was $58 million, with $90 million capital expenditures and $65 million returned to shareholders via buybacks and dividends.
- 2025 capital expenditure guidance remains $400-450 million, with focus on operationalizing completed projects.
- Caribou Pulp facility incurred $6 million EBITDA impact from maintenance shutdown but is now operational with improved output.

**【Q&A Highlights】**
- **Production Management**:** Lumber and OSB production rates adjusted to 80% of capacity in Q4, with OSB operating rate ~80% due to seasonal maintenance.
- **M&A Strategy:** Quality-first approach to inorganic growth, with focus on high-quality, strategically aligned assets.
- **Tariff Impact:** West Fraser has lowest Canadian industry duty rate (26.5%), but new Section 232 tariffs add 10% to imported softwood lumber costs.
- **Working Capital:** Tight management of receivables and inventories, with lean inventory levels across product lines.


West Fraser Timber Co Ltd (WFG) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

WFG

WFG fundamentals

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