Conifex Timber (CFF) Q2 2025 earnings summary

Executive summary

• Q2 2025 results were weaker than Q1 due to lower power prices, extended maintenance shutdown at the power plant, and reduced log availability, resulting in a net loss of $8.3 million and negative EBITDA of $3.2 million.

• Q2 power production was 38% lower than Q1 and 22% lower than Q2 2024, with higher maintenance costs and reduced bioenergy output impacting results.

• First half 2025 EBITDA was positive at $1.7 million after accounting for an $800,000 FX loss, despite a Q2 loss.

• Lumber production was 35.3 MMfbm, down 24% sequentially, and sales were impacted by operational adjustments and lower benchmark prices.

Financial highlights

• Q2 2025 sales: $27.4M from lumber, $2.9M from by-products, $3.6M from bioenergy; lumber revenues decreased 12% sequentially but increased 10% year-over-year.

• Q2 revenues and EBITDA were negatively affected by a 4% strengthening of the Canadian dollar against the U.S. dollar.

• Cumulative duty deposits paid total CAD $57 million, with CAD $11 million in overpayments and interest recorded as a long-term receivable.

• Available liquidity at quarter-end was $3.0M, down from $4.2M in Q1 2025 and $10.9M in Q2 2024.

• Cost of goods sold decreased 7% from Q1 2025 and 10% from Q2 2024; SG&A costs fell to $1.5M.

Outlook and guidance

• Expectation of positive EBITDA in the second half of 2025, excluding one-time or non-recurring charges, due to improved power plant performance.

• Q3 will include a one-time non-cash charge of approximately $8 million due to increased U.S. duty rates on lumber exports.

• North American lumber markets expected to remain volatile and uncertain for the rest of 2025, with plans to sustain two-shift operations.

• Lumber price increases are offsetting most of the impact from higher duty deposit rates.

• Mid-case projection assumes higher duty rates persist but no new tariffs are imposed.