$CFP.TO

Canfor Agrees to Acquire I-Joist Facility in Calgary for C$68 Million

Canfor (CFP.TO) has agreed to purchase PinkWood's I-joist business for C$68.0 million, including working capital, the company said late on Tuesday.PinkWood is the largest I-joist facility in Western Canada, producing engineered wood joists for residential, multi-family and commercial construction. Calgary, Alberta-based PinkWood has a production capacity of 46 million linear feet.The purchase price represents a 5 times EBITDA multiple based on current production levels and earnings, including identified synergies.Of the total consideration, $55.0 million is payable on closing. The remaining $13.0 million is payable over 5 years."Canfor's acquisition of PinkWood complements our operations in Western Canada by enhancing product diversification and supporting the continued expansion of our value-added manufacturing capabilities," said Susan Yurkovich, president and chief executive officer of Canfor.

Canfor Says Vida AB to Close Two Sawmills in Southern Sweden

Canfor's (CFP.TO) 77%-owned unit, Vida AB, will permanently close its sawmill operations in Urshult and Orrefors, Sweden, it said over the holiday weekend.The closures will reduce Vida's annual lumber production capacity by about 265,000 cubic meters, it said. Vida will operate 13 sawmills across central and southern Sweden following the closures, along with its other facilities in packaging, specialty finishing, and logistics."While this was a difficult decision, the closures are necessary given the ongoing imbalance between production capacity and access to fibre in southern Sweden," said Vida AB Chief Executive Karl-Johan Lowenadler. "By concentrating production in fewer more productive and efficient facilities, we will strengthen Vida's competitiveness and better position the business for the future."Shares of Canfor closed down 1.4% to $11.94 on Friday on the Toronto Stock Exchange.

Canfor Reports Wider Q1 Net loss On Lower, But Better Than Expected, Sales; Flags Improvement, Though Demand Still An Issue

Forest products company Canfor (CFP.TO) reported wider net loss and lower sales in the first quarter compared to a year earlier, even though sales did exceed analysts' estimates, while the company flagged "improved performance in both the lumber segment and, to a lesser extent, the pulp and paper segment" even though demand remained "relatively subdued".For the first quarter, net loss attributable to equity shareholders of the company was C$72.1 million, compared to net loss of $31 million in the corresponding year-ago quarter. Net loss per share, basic and diluted in the first quarter was $0.62 per share, compared to net loss per share, basic and diluted of $0.26 per share in the year-ago quarter.First quarter sales were $1.36 billion, compared to $1.42 billion in the year-ago quarter. The consensus estimates compiled by FactSet for sales was $1.29 billion.The company reported an operating loss of $72.5 million for the current quarter, compared to an operating loss of $415.9 million for the fourth quarter of 2025. After taking into consideration a $20.0 million reversal of a previously recognized inventory write-down, the company's adjusted operating loss was $92.5 million for the first quarter of 2026, compared to an adjusted operating loss of $145.0 million for the fourth quarter of 2025. "These results largely reflected improved performance in both the lumber segment and, to a lesser extent, the pulp and paper segment," it said in a statement."The first quarter of 2026 continued to reflect challenging market conditions across our global operations," said President and Chief Executive Officer, Susan Yurkovich. "While we saw an improvement in results, largely due to a supply-driven uptick in North American lumber pricing and higher production levels, demand remained relatively subdued. Despite ongoing trade pressures, geopolitical uncertainty, and weather related disruptions in certain regions, our focus on controllable factors helped support improved performance during the quarter. We continue to closely monitor market conditions while positioning the company to respond as conditions evolve."Yurkovich added: "Global pulp markets continued to face significant headwinds during the first quarter, with pulp producer inventories remaining elevated. As we anticipate these challenges to persist in the near-term, we remain focused on operational resilience and disciplined cost control while continuing to assess operational competitiveness."In its pulp and paper segment outlook, Canfor said a maintenance outage is scheduled at the company's Intercontinental NBSK pulp mill in the second quarter of 2026, which is anticipated to result in a reduction of approximately 20,000 tonnes of NBSK market pulp production. A maintenance outage is also planned at its paper machine with an anticipated reduction of 5,000 tonnes in paper production, it added.On lumber segment outlook, the company anticipates global lumber markets to remain affected by ongoing global trade flow disruptions, particularly given the conflict in Iran. These challenges are likely to continue to drive cost inflation and increase macroeconomic uncertainty, it said. Ongoing supply chain constraints, particularly for petroleum-based products, are anticipated to adversely affect new housing construction. "These factors are projected to further influence market dynamics and contribute to continued pricing volatility within the global lumber sector," it added.Canfor recently acquired the remaining issued and outstanding shares of Canfor Pulp Products Inc., resulting in 100% ownership of Canfor Pulp.

Earnings Flash (CFP.TO) Canfor Reports Q1 Revenue $1.36B, vs. $1.418M a Year Earlier

CIBC Provides its Q1/26 Forestry, Building Products & Packaging Preview

CIBC Capital Markets on Tuesday provided its "Q1/26 Forestry, Building Products & Packaging Preview" and said that heading into first quarter earnings season, it remains cautious on wood/building product equities as elevated mortgage rates are "likely to continue weighing on demand".It further said that while there was a level of optimism from some industry participants going into the key spring selling season, which kicked off in early February, there has been "little indication of a material pickup in demand"."Moreover, the onset of the conflict in the Middle East has further eroded consumer confidence, which was accompanied by a spike in mortgage rates (currently sitting ~30 bps higher than pre-war levels at 6.3%), further adding to homebuyer affordability challenges," said CIBCCIBC also said that it sees added inflationary pressures, including freight, diesel and resins, for several companies under its coverage, posing downside risk to Q2 consensus estimates."That being said, Canadian lumber companies should see moderating duties in the back half of the year, with the preliminary AR7 combined AD/CV "All Others" rate of 24.83% announced (vs. the current rate of 35.16%)," added CIBC.CIBC also said that CCL Industries (CCL-B.TO) remains its top pick across its Forestry, Building Products & Packaging coverage universe, given the difficult housing backdrop weighing on wood/building product equities.CIBC believes CCL's diversified global platform and end-market exposure should support "steady top-line growth over the cycle," supported by continued RFID growth and benefits from recent business wins and capital projects."With leverage of only 0.8x, CCL is well positioned to be opportunistic with M&A, buybacks and organic investments," added CIBC.It further said that, among its Paper & Packaging names, it also rates Transcontinental (TCL-A.TO) outperformer given the company's "strong FCF generation, margin improvement initiatives and further M&A prospects".Across its broader housing-related coverage, CIBC said it has an outperformer rating on ADENTRA (ADEN.TO) and Weyerhaeuser (WY)."While wood product prices have moved higher, our channel checks indicate that consensus estimates for wood products companies may be overly optimistic for the first quarter," said CIBC. "Further out, consensus still looks overly aggressive on most wood names for 2026/2027 given elevated mortgage rates, weak consumer confidence and potentially higher cost inflation."CIBC added that its largest adjustments are for Canfor (CFP.TO), West Fraser Timber (WFG.TO) and WY, where for the next two years, CIBC is reducing estimates by an average of 20%/12%, leaving its revised estimates for 2026/2027 approximately 26%/10% lower than consensus.CIBC lowered its price targets on Canfor from C$16 to C$15, Mercer International (MERC) from US$2.00 to US$1.75, Stella-Jones (SJ.TO) from C$102 to C$96, and West Fraser from C$108 to C$102, "largely reflecting weaker commodity price estimates.""While our expected total return for Mercer is notably higher, given limited share price liquidity and greater volatility in MERC's share price, we believe a much higher return is necessary on the micro-cap pulp equity to warrant a more constructive rating," added CIBC.CIBC increased its price targets on ADENTRA from C$42 to C$44 and Doman Building Materials Group (DBM.TO) from C$11.00 to C$11.50, "reflecting higher valuation multiples given continued M&A activity in the distributor space."CIBC said that it is also raising its price target on CCL from C$102 to C$103, on "improved confidence in the company's ability to quickly pass through rising input costs."Price: $86.25, Change: $-0.35, Percent Change: -0.40%

Canfor Downgraded to Sector Perform at RBC

Canfor Corp. (CFP.TO) was downgraded to Sector Perform from Outperform at RBC Capital Markets on Thursday.Analyst Matthew McKellar maintained a price target of $15 on shares of the Vancouver-based forest products company."While Canfor has maintained a solid balance sheet and made significant strides in repositioning its lumber business (closing high-cost capacity in BC, investing in the US South and in Sweden) - and to some degree we think this remains under-appreciated by the market - we see relatively better opportunities in our coverage group with Canfor's share price drawing closer to our target, particularly with potential near-term headwinds in Sweden (demand, fiber costs)," McKellar said in a note to clients.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www..com/contact-us)