Raymond James analyst Daryl Swetlishoff has revised the price target for Interfor (IFSPF, Financial), reducing it from C$26 to C$22. Despite the adjustment, Swetlishoff maintains a Strong Buy rating on the stock.
IFSPF Key Business Developments
Release Date: February 14, 2025
- Operating Cash Flow: $144 million positive operating cash flow for 2024.
- Adjusted EBITDA: $80 million for Q4.
- Total Revenue: $747 million for Q4, an 8% increase quarter over quarter.
- Average Realized Lumber Price: 16% increase quarter over quarter.
- Production Costs: 5% reduction in production costs per unit of lumber sold quarter over quarter.
- Net Loss: $50 million for Q4, including a $42 million foreign exchange loss.
- Operating Cash Flow: $75 million for Q4.
- Capital Expenditures: $11 million in Q4, with 2025 guidance refined to approximately $85 million.
- Debt Repayment: $35 million in Q4.
- Liquidity: Available liquidity grew to over $380 million.
- BC Coast Tenure Sales: Gross proceeds of $67 million from eight tenure sales in 2024.
- Financial Leverage: Remained flat at 36% quarter over quarter.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Interfor Corp (IFSPF, Financial) achieved positive operating cash flow of $144 million in a challenging market with low lumber prices.
- The company completed a new planer project at the Thomaston, Georgia mill, meeting all KPI targets within 30 operating days.
- Interfor Corp (IFSPF) reduced mill conversion costs across most regions despite significant market-related curtailments.
- Employee turnover rates improved across the company's platform.
- The company generated adjusted EBITDA of $80 million for Q4, with all operating regions in Canada and the US being EBITDA positive.
Negative Points
- Interfor Corp (IFSPF) recorded a net loss of $50 million in Q4, including a $42 million foreign exchange loss.
- The company faces ongoing volatility in the lumber industry due to uncertain economic and political environments.
- Canadian lumber is facing headwinds for shipments to the US markets, with potential tariffs adding to cost pressures.
- Lumber demand is showing signs of decline due to economic uncertainties, impacting short-term market stability.
- The threat of tariffs creates a fluid and uncertain demand environment, with customers hesitant to build inventory.
