Western Announces Third Quarter 2026 Results
VANCOUVER, British Columbia, Nov. 05, 2026 (GLOBE NEWSWIRE) -- Western Forest Products Inc. (TSX: WEF) (“Western” or the “Company”) reported Adjusted EBITDA of $1.9 million in the third quarter of 2026, as compared to negative $65.9 million in the same period last year. Adjusted EBITDA in the third quarter of 2026 included $7.7 million related to business interruption insurance recovery from our Columbia Vista Division (“CVD”) sawmill, a $3.9 million non-cash expense related to a change in estimate on our export duty receivable for the first six softwood lumber administrative reviews (“AR”) and a $1.2 million expense related to share-based compensation. Results in the third quarter of 2025 included a $59.5 million non-cash export duty expense related to the determination of final duty rates from the sixth AR and a $0.5 million expense related to share-based compensation.
Net loss was $5.2 million in the third quarter of 2026, as compared to a net loss of $61.3 million for the same period last year. Results in the third quarter of 2026 benefitted from higher realized lumber prices, higher log shipments and the gain on the sale of our CVD sawmill site, partially offset by lower lumber shipments compared to the same period last year. Results in the third quarter of 2025 were negatively impacted by the finalization of the sixth AR.
| (millions of Canadian dollars except per share amountsand where otherwise noted) | Q3 2026 | Q3 2025 | Q2 2026 | YTD 2026 | YTD 2025 | |||||||||||||||
| Revenue | $ | 237.0 | $ | 233.0 | $ | 239.6 | $ | 678.1 | $ | 784.6 | ||||||||||
| Adjusted EBITDA (1) | 1.9 | (65.9 | ) | 0.4 | (11.3 | ) | (62.0 | ) | ||||||||||||
| Adjusted EBITDA margin (1) | 1% | (28% | ) | 0% | (2% | ) | (8% | ) | ||||||||||||
| Operating loss prior to restructuring and other items | $ | (18.8 | ) | $ | (78.0 | ) | $ | (11.9 | ) | $ | (56.2 | ) | $ | (99.5 | ) | |||||
| Net (loss) income | (5.2 | ) | (61.3 | ) | 10.5 | (14.6 | ) | (64.9 | ) | |||||||||||
| (Loss) earnings per share, diluted | (0.44 | ) | (5.71 | ) | 1.10 | (1.17 | ) | (6.00 | ) | |||||||||||
| Net debt (1), end of period | 14.7 | 11.6 | 32.2 | |||||||||||||||||
| Liquidity (1), end of period | 260.8 | 234.2 | 243.6 | |||||||||||||||||
| Net debt to capitalization (1) | 3% | 2% | 6% | |||||||||||||||||
(1) Refer to Adjusted EBITDA, Adjusted EBITDA margin, Liquidity and Net debt to capitalization in the Non-GAAP Financial Measures section.
Third Quarter 2026 Financial and Operational Summary
- Lumber production of 127 million board feet (versus 130 million board feet in Q3 2025).
- Lumber shipments of 136 million board feet (versus 152 million board feet in Q3 2025).
- Cedar lumber shipments of 21 million board feet (versus 24 million board feet in Q3 2025).
- Specialty lumber mix of 52% (versus 51% in Q3 2025).
- Average lumber selling price of $1,245 per mfbm (versus $1,194 per mfbm in Q3 2025).
- Average BC log sales price of $149 per m3 (versus $160 per m3 in Q3 2025).
Accelerating the Transition to Higher Value Products
- Strategic investments in kiln drying completed with commissioning of the second of our two continuous dry kilns at our Value-Added Division in June 2026 and commissioning of a new thermal kiln at our Value-Added Division in July 2026.
- Received $1.5 million from Fortis BC under the Efficiency Incentive Program related to our second continuous dry kiln at our Value-Added Division and accrued $2.0 million from the Province of British Columbia’s BC Manufacturing Jobs Fund.
- Upgrading of an autograder with AI technology at Duke Point is underway, with anticipated completion in early 2027.
Columbia Vista Property Sale and Insurance
- In July 2026, the Company completed the sale of the CVD sawmill site and certain assets with a third party for gross proceeds of USD$14.7 million ($20.8 million).
- In September 2026, the Company and its adjuster finalized its claim for business interruption insurance related to the fire for USD$5.5 million ($7.7 million).
- Combined gross proceeds from property insurance, business interruption insurance and the sale of the sawmill site have totalled USD$48.0 million ($66.7 million).
Sale of Stillwater Forest Operation
- On November 3, 2026, we completed the previously announced sale of our Stillwater Forest Operation to Qwoqwnes Forestry Holdings Limited Partnership for approximately $80.0 million.
Balance Sheet and Cash Flow
- Net debt decreased $17.5 million from the end of the second quarter of 2026.
- Ended the quarter with liquidity of $260.8 million and a net debt to capitalization ratio of 3%, compared to $243.6 million of liquidity and a net debt to capitalization ratio of 6% as at June 30, 2026.
- 2026 capital expenditure spending is anticipated to be between $45 and $50 million, which includes approximately $23 million of planned spending on the two continuous dry kilns and one thermal kiln at our Value-Added Division and the autograder at Duke Point.
Operating Curtailments
Our Cowichan Bay and Chemainus sawmills are expected to remain curtailed for the remainder of 2026 due to persistently weak market conditions, high softwood lumber duties and tariffs and factors relating to the BC operating environment.
Softwood Lumber Dispute
On October 14, 2026, the DoC announced its final rates from its seventh AR for shipments in 2024, indicating an AD rate of 10.64% and a CV rate of 14.11%, compared to the current rates of 20.53% and 14.63%, respectively, applicable to the Company. Shipments in 2024 were subject to weighted average rates of 3.62% and 6.78% for CV and AD, respectively. As a result of the final seventh AR rates, Western will record a non-cash export tax expense of USD$27.6 million, plus accrued interest of approximately USD$5.5 million in the fourth quarter of 2026.
Market Outlook
Industrial product lines are expected to be stable through the fourth quarter with some improvements in matting products following the announcement of significant capital projects in Canada, such as the LNG Canada plant expansion and the Pacific Link pipeline. In North America, cedar demand and pricing has softened, primarily due to affordability pressures, given elevated interest rates and higher fuel costs. We also expect further reductions towards the end of the year for pricing in decking, trim and fencing as supply continues to outstrip demand in these categories. While North American commodity markets have recently declined, we are expecting prices to improve in the fourth quarter of 2026, supported by a greater focus on Canadian customers, like treaters, that yield higher net mill returns.
Housing activity in Japan remained resilient throughout the summer, supported by the market advancing projects and housing starts ahead of anticipated mortgage rate increases. Lumber demand in Japan is expected to be stable in the fourth quarter of 2026. Market inventories in China have built over the past few months, reflecting a seasonal slowdown in consumption during the summer season. Demand is expected to strengthen towards the end of the year as inventories are drawn down and customers look to replenish stock prior to the 2027 lunar new year.
Management Discussion & Analysis ( "MD&A ")
Readers are encouraged to read our Q3 2026 MD&A and interim consolidated financial statements and accompanying notes which are available on our website at www.westernforest.com and “SEDAR+” at www.sedarplus.ca.
Risks and Uncertainties
Risk and uncertainty disclosures are included in our 2025 Annual MD&A, as updated in the disclosures in our Q3 2026 MD&A, as well as in our public filings with securities regulatory authorities. See also the discussion of “Forward-Looking Statements” below.
Non-GAAP Financial Measures
Reference is made in this press release to the following non-GAAP measures: Adjusted EBITDA, Adjusted EBITDA margin, Net debt to capitalization, and total Liquidity are used as benchmark measurements of our operating results and as benchmarks relative to our competitors. These non-GAAP measures are commonly used by securities analysts, investors and other interested parties to evaluate our financial performance. These non-GAAP measures do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other issuers. The following table provides a reconciliation of these non-GAAP measures to figures as reported in our consolidated interim financial statements:
(millions of Canadian dollars except where otherwise noted)
| Adjusted EBITDA | Q3 2026 | Q3 2025 | Q2 2026 | YTD 2026 | YTD 2025 | |||||||||||
| Net (loss) income | $ | (5.2 | ) | $ | (61.3 | ) | $ | 10.5 | $ | (14.6 | ) | $ | (64.9 | ) | ||
| Add: | ||||||||||||||||
| Amortization | 12.9 | 12.1 | 12.7 | 37.4 | 37.6 | |||||||||||
| Changes in fair value of biological assets | (0.1 | ) | - | (0.1 | ) | (0.2 | ) | (0.1 | ) | |||||||
| Operating restructuring items | 1.3 | - | 2.1 | 4.4 | 0.8 | |||||||||||
| Other (income) expense | (7.3 | ) | (6.9 | ) | (29.4 | ) | (37.9 | ) | (22.2 | ) | ||||||
| Finance costs | 2.7 | 12.0 | 2.1 | 6.9 | 13.8 | |||||||||||
| Income tax expense (recovery) | (2.6 | ) | (21.8 | ) | 2.8 | (7.3 | ) | (27.0 | ) | |||||||
| Adjusted EBITDA | $ | 1.9 | $ | (65.9 | ) | $ | 0.4 | $ | (11.3 | ) | $ | (62.0 | ) | |||
| Adjusted EBITDA margin | ||||||||||||||||
| Total revenue | $ | 237.0 | $ | 233.0 | $ | 239.6 | $ | 678.1 | $ | 784.6 | ||||||
| Adjusted EBITDA | 1.9 | (65.9 | ) | 0.4 | (11.3 | ) | (62.0 | ) | ||||||||
| Adjusted EBITDA margin | 1% | (28% | ) | 0% | (2% | ) | (8% | ) | ||||||||
| Net debt to capitalization | Sep. 30 2026 | Sep. 30 2025 | Jun. 30 2026 | |||||||||||||
| Net debt | ||||||||||||||||
| Total debt | $ | 29.4 | $ | 16.9 | $ | 36.1 | ||||||||||
| Bank indebtedness | - | 0.4 | 0.4 | |||||||||||||
| Cash and cash equivalents | (14.7 | ) | (5.7 | ) | (4.3 | ) | ||||||||||
| $ | 14.7 | $ | 11.6 | $ | 32.2 | |||||||||||
| Capitalization | ||||||||||||||||
| Net debt | $ | 14.7 | $ | 11.6 | $ | 32.2 | ||||||||||
| Total equity attributable to equity shareholders of the Company | 467.2 | 492.1 | 471.9 | |||||||||||||
| $ | 481.9 | $ | 503.7 | $ | 504.1 | |||||||||||
| Net debt to capitalization | 3% | 2% | 6% | |||||||||||||
| Total liquidity | ||||||||||||||||
| Cash and cash equivalents | $ | 14.7 | $ | 5.7 | $ | 4.3 | ||||||||||
| Available credit facility (1) | 250.0 | 250.0 | 250.0 | |||||||||||||
| Bank indebtedness | - | (0.4 | ) | (0.4 | ) | |||||||||||
| Credit facility drawings | - | (17.9 | ) | (6.8 | ) | |||||||||||
| Outstanding letters of credit included in line utilization | (3.8 | ) | (3.2 | ) | (3.5 | ) | ||||||||||
| $ | 260.8 | $ | 234.2 | $ | 243.6 | |||||||||||
| Figures in the table above may not equal or sum to figures presented in the table and elsewhere due to rounding. | ||||||||||||||||
| (1) Maximum borrowing amount, with advances in excess of $215 million subject to a leverage metric. Borrowings are also subject to certain financial covenants, including a maximum debt to total capitalization ratio and a minimum consolidated net worth test. | ||||||||||||||||
Forward Looking Statements and Information
This press release contains statements that may constitute forward-looking statements under the applicable securities laws. Readers are cautioned against placing undue reliance on forward-looking statements. All statements herein, other than statements of historical fact, may be forward-looking statements and can be identified by the use of words such as “will”, “commit”, “project”, “estimate”, “expect”, “anticipate”, “plan”, “forecast”, “intend”, “believe”, “seek”, “could”, “should”, “may”, “likely”, “continue”, “maintain”, “pursue”. “potential” and similar references to future periods. Forward-looking statements in this press release include, but are not limited to, statements relating to our current intent, belief or expectations with respect to: domestic and international market conditions, demands and growth; economic conditions; the softwood lumber dispute; the applicability and scope of tariffs and the expected timing thereof; the duration of curtailments at the Company’s facilities; the completion of the Company’s capital projects and the expected cost and timing thereof; and the Company’s balance sheet and financial flexibility. Although such statements reflect management’s current reasonable beliefs, expectations and assumptions as to, amongst other things, the future supply and demand of forest products, global and regional economic activity and the consistency of the regulatory framework within which the Company currently operates, there can be no assurance that forward-looking statements are accurate, and actual results and performance may materially vary.
Many factors could cause our actual results or performance to be materially different including: economic and financial conditions including inflation, international demand for forest products, the Company’s ability to export its products, cost and availability of shipping carrier capacity, competition and selling prices, international trade disputes and sanctions, changes in foreign currency exchange rates, labour disputes and disruptions, ability to recruit workers, natural disasters, the impact of climate change, relations with First Nations groups, First Nations’ claims and settlements, the availability of fibre and allowable annual cut, the ability to obtain operational permits, development and changes in laws and regulations affecting the forest industry, changes in the price of key materials for our products, changes in opportunities, information systems security and other factors referenced under the “Risks and Uncertainties” section of our MD&A in our 2025 Annual Report dated February 10, 2026. The foregoing list is not exhaustive, as other factors could adversely affect our actual results and performance. Forward-looking statements are based only on information currently available to us and refer only as of the date hereof. Except as required by law, we undertake no obligation to update forward-looking statements.
Reference is made in this press release to adjusted EBITDA which is defined as operating income prior to operating restructuring items and other income (expense) plus amortization of plant, equipment and intangible assets, impairment adjustments, and changes in fair value of biological assets. Adjusted EBITDA margin is adjusted EBITDA as a proportion of revenue. Western uses adjusted EBITDA and adjusted EBITDA margin as benchmark measurements of our own operating results and as benchmarks relative to our competitors. We consider adjusted EBITDA to be a meaningful supplement to operating income as a performance measure primarily because amortization expense, impairment adjustments and changes in the fair value of biological assets are non-cash costs, and vary widely from company to company in a manner that we consider largely independent of the underlying cost efficiency of their operating facilities. Further, the inclusion of operating restructuring items which are unpredictable in nature and timing may make comparisons of our operating results between periods more difficult. We also believe adjusted EBITDA and adjusted EBITDA margin are commonly used by securities analysts, investors and other interested parties to evaluate our financial performance.
Adjusted EBITDA does not represent cash generated from operations as defined by IFRS and it is not necessarily indicative of cash available to fund cash needs. Furthermore, adjusted EBITDA does not reflect the impact of certain items that affect our net income. Adjusted EBITDA and adjusted EBITDA margin are not measures of financial performance under IFRS, and should not be considered as alternatives to measures of performance under IFRS. Moreover, because all companies do not calculate adjusted EBITDA and adjusted EBITDA margin in the same manner, these measures as calculated by Western may differ from similar measures calculated by other companies. A reconciliation between the Company’s net income as reported in accordance with IFRS and adjusted EBITDA is included in this press release.
Also in this press release management may use key performance indicators such as net debt, net debt to capitalization, and current assets to current liabilities. Net debt is defined as long-term debt less cash and cash equivalents. Net debt to capitalization is a ratio defined as net debt divided by capitalization, with capitalization being the sum of net debt and equity. Current assets to current liabilities is defined as total current assets divided by total current liabilities. These key performance indicators are non-GAAP financial measures that do not have a standardized meaning and may not be comparable to similar measures used by other issuers. They are not recognized by IFRS, however, they are meaningful in that they indicate the Company’s ability to meet their obligations on an ongoing basis, and indicate whether the Company is more or less leveraged than the prior year.
Conference Call
Friday November 6, 2026 at 9:00 a.m. PCT (11:00 a.m. EST)
To participate in the teleconference please dial 1-647-846-2809 or 1-877-883-0383 (passcode: 8280717#). This call will be taped, available one hour after the teleconference, and on replay until December 6, 2026 at 9:59 p.m. PCT (11:59 p.m. EST). To hear a complete replay, please call 1-412-317-0088 / 1-855-669-9658 (passcode: 3861765#).
About Western Forest Products Inc.
Western is an integrated forest products company building a margin-focused log and lumber business to compete successfully in global softwood markets. With operations and employees located primarily on the coast of British Columbia and Washington State, Western is a premier supplier of high-value, specialty forest products to worldwide markets. Western has a lumber capacity of 785 million board feet from five sawmills, as well as operates four remanufacturing facilities and two glulam manufacturing facilities. The Company sources timber from its long-term licences, First Nations arrangements, and market purchases. Western supplements its production through a wholesale program providing customers with a comprehensive range of specialty products.
For further information, please contact:
Glen Nontell
Chief Financial Officer
(604) 648-4500
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