Tag Archives: Mackenzie

Conifex Timber has reported a net loss of $3.6 million for the fourth quarter of 2012 compared to a net loss of $2.8 million for the previous quarter and a net loss of $7.5 million for the fourth quarter of 2011.

The net loss for the year ended December 31, 2012 was $16.2 million compared to a net loss of $16.9 million for the year ended December 31, 2011.

Revenues totalled $60 million in the fourth quarter of 2012 compared to $54.4 million in the previous quarter and $38.7 million in the fourth quarter of 2011.

During 2012, Conifex Timber primarily focused on shorter-term opportunities to enhance the cash flow producing capabilities of its lumber segment assets. Since only modest improvements in lumber segment competitiveness were achieved in 2012, Conifex effected a management reorganization in December.

Looking forward, management expects the benefits of an improved log profile at Mackenzie and capital upgrades at Fort St. James and Mackenzie will continue to enrich product mix and result in competitive mill net realizations.

Unit cash conversion costs are expected to improve in 2013 due to normalization of certain operating costs, increased productivity and the achievement of further benefits from its performance improvement program.

Read full release from Conifex

Pat Bell, British Columbia’s MLA for Prince George-Mackenzie, has released a statement saying he will not be running for another term as MLA.

Bell said he has been diagnosed with a “relatively rare type of aneurism”.  He is seeing a cardiac specialist who is monitoring the size of the aneurism.

“All of this has caused me to re-think my decision to seek another term as the MLA for Prince George-Mackenzie. This is a critical and compelling time for our province and it’s equally critical that our team members are able to focus 100 per cent of their attention on the task at hand. With this diagnosis, I need to turn my mind to my personal health and this would take my attention away from my responsibilities as your MLA. For this reason I am announcing today that I have decided to withdraw my nomination as the BC Liberal candidate in the upcoming provincial election.”

~Pat Bell

Bell is the Minister of Jobs, Tourism and Skills Training and Minister Responsible for Labour.  He has also served as Minister of Jobs, Tourism and Innovation; Minister of Forests, Mines and Lands; Minister of Forests and Range; Minister of Agriculture and Lands; and as the first Minister of State for Mining.

Read full statement

Canfor Corporation has reported a net income of $24.6 million in the fourth quarter of 2012 and $41.4 million in the 2012 fiscal year.

The net income attributable to shareholders is $21.6 million in the 4th quarter, and $32.1 million for the entire 2012 fiscal year.

Commenting on the fourth quarter performance, Canfor’s President and CEO, Don Kayne, said, “The improvement in lumber sales realizations reflected the encouraging continued growth in global demand for softwood lumber products.”

Kayne added that the company was continuing its focus on making high-return strategic capital investments as highlighted by the recently announced capital upgrades at its Elko and Mackenzie operations.”These two projects along with the start-up of our upgraded Radium mill early in the fourth quarter demonstrate our ongoing commitment to expand our capacity to provide high quality products to our customers,” said Kayne.

Regarding the pulp and paper segment’s fourth quarter results, Kayne said, “After last quarter’s challenges at the Canfor Pulp facilities, it was encouraging to see solid improvements in productivity, as well as some improvement in market conditions this quarter.”

For the full financial release, and comparable results from 2011, view:
Canfor Reports Results for Fourth Quarter of 2012

Canfor Corporation is proceeding with capital improvement projects totalling approximately $40 million to increase productivity and recovery at its sawmill in Mackenzie, British Columbia.

The investment will include modifications and upgrades to the sawmill, kilns and planer.

“Our fibre supply in the Mackenzie region is strong and this announcement reflects confidence in our ability to operate an internationally-competitive mill in this community,” said Don Kayne, President and CEO of Canfor Corporation.

The capital project will commence in January 2013. Completion is anticipated in November 2013.

This announcement brings the total dollar value of the company’s capital investments to ensure competitive operation of its British Columbia solid wood, pulp and paper facilities to $600 million over the last three years. The reopening of the Vavenby and Radium mills after significant capital investments resulted in the creation of 305 direct jobs, combined with significant downstream benefits to local economies.

Source: Canfor

Conifex Timber Inc. has received shipment and delivery of its turbine generator at its power facility situated in Mackenzie, British Columbia in connection with the company’s bioenergy project.

The project is approximately 30% complete and is currently on budget and on time.

In order to further the continued development of the project and secure satisfactory long-term financing, Conifex is continuing with essential engineering and equipment procurement activities but will temporarily suspend installation and construction activities.

The company is continuing discussions with several lenders with respect to long-term financing for the bioenergy project. Negotiations with a potential lender that was seeking an equity interest in the project have been terminated. A material delay in securing long-term financing for the bioenergy project could delay the overall development of the project, including the commercial operation date which is currently scheduled for the third quarter of 2013.

Ken Shields, Chief Executive Officer of Conifex, stated: “While it is disappointing to have to reduce expenditures on the project over the next few months, we concluded that it was more important for us to have the best possible financing in place to ensure that an optimal value is realized for Conifex and its shareholders over the 20-year term of our energy purchase agreement with B.C. Hydro. We remain optimistic that we will identify appropriate financing for the Bioenergy Project that makes sense for Conifex.”

Source: Conifex Timber

Visit Conifex’s website at http://www.Conifex.com

Conifex Timber Inc. is reporting a net loss of $3.7 million in the third quarter of 2012.

This result can be compared to a net loss of $2.4 million in the second quarter of 2012, and a net loss of $2.2 million for the third quarter of 2011.

EBITDA in the third quarter of 2012 was negative $0.5 million compared to positive $0.6 million in the previous quarter and the third quarter of 2011. Consolidated EBITDA of negative $0.5 million was comprised of $1.0 million positive EBITDA from the lumber segment offset by negative EBITDA of $0.3 million from the bioenergy segment and $1.2 million from corporate costs and other items. Costs related to the bioenergy segment, and corporate costs when normalized for the effects of foreign exchange gain or loss, were consistent throughout the comparative periods.

Lumber segment EBITDA was $1.0 million for the current quarter and the third quarter of 2011 and $1.7 million for the second quarter of 2012. Inventory valuation adjustments, short-term consulting fees and gains from lumber future derivatives resulted in a net expense of $0.4 million in the current quarter compared to a net benefit of $1.5 million in the previous quarter and a net benefit of $0.5 million in the third quarter of 2011.

Lumber segment revenue totalled $54.4 million during the third quarter of 2012 compared to $55.8 million in the previous quarter. A small increase in revenue from lumber shipments despite a 4% decrease in shipment volumes was offset by a decrease in revenue from residual products and from the company’s third party logistics business. Per unit mill net realizations increased by 9% over the previous quarter with one third of the increase attributable to a lower average export tax rate and the balance primarily attributable to the shipment of an improved sales mix. The higher value sales mix was largely attributable to improved grade outturns as a result of the capital upgrade completed during the previous quarter and a return to a more representative sawlog profile at Mackenzie.

Production volumes were approximately 102 million board feet for each of the comparative quarters and represented annualized operating rates of approximately 55%. Production volume and costs during the current and previous quarter were negatively impacted by approximately 5% by the planned maintenance and capital upgrade downtime taken at both of the company’s mills to focus on dust mitigation and other workplace safety initiatives. Unit conversion costs during the third quarter of 2012 increased by 5% over the previous quarter with the increase largely attributable to costs related to higher insurance premiums, ongoing dust mitigation activities and a heightened focus on training and preventative maintenance initiatives related to the recently implemented performance improvement program at Fort St. James. The implementation of the remedial program and the continued progress of the new leadership team at the mill contributed to an increase in sawmill productivity in September of 9% over the year to date average.

Conifex Timber also announced it is in well advanced negotiations with a significant financial institution to secure approximately $75 million in funding for its Mackenzie generation project. One alternative being pursued is to secure approximately $60 million in long-term senior secured project debt and approximately $15 million through a sale of a minority equity interest in the Mackenzie project. However, currently there can be no assurance that the company will obtain the necessary funding for the project on the foregoing terms, other terms reasonably satisfactory to it or at all.

Source: Conifex

Conifex Timber is reporting a net loss of $6.5 million in its first quarter of 2012. In comparison, the company posted a net loss of $7.5 million for the fourth quarter of 2011, and a net loss of $3.6 million in the first quarter of 2011.

Lumber segment EBITDA was negative $2.7 million for the first quarter of 2012 compared to negative $4.1 million for the previous quarter and negative $0.3 million for the first quarter of 2011. Current quarter lumber segment results include those of our newly acquired marketing and transportation and logistics subsidiaries. These businesses made a modest positive contribution to lumber segment EBITDA during the quarter that was in line with management expectations. The improvement of $1.4 million lumber segment EBITDA over the previous quarter was generally attributable to an increase in unit mill net realization, increased profit from lumber derivatives and lower unit cash conversion and marketing and administrative costs due partly to a higher operating rate. Compared to the first quarter of 2011, current quarter improvements in unit cash conversion and SG&A expenses were partially offset by increased log costs, change in inventory valuation adjustment, and a decline in mill net realizations.

The 12% improvement in average benchmark lumber prices during the current quarter over the fourth quarter of 2011 was partially offset by a 2% strengthening of the Canadian dollar over the U.S. dollar. Low grade prices remained at unusually wide discounts to the #2 and Better prices during most of the quarter before showing a marked improvement over the closing weeks. Unit mill net realizations were hampered during the first quarter of 2012 as the Company worked off an abnormally high proportion of low grade inventory and lower priced export order files and built up inventory of premium grade products ahead of strong second quarter order files.

Lumber segment revenue totalled $47.4 million during the first quarter of 2012, an increase of 22% over the previous quarter and 124% over the first quarter of 2011. Shipment of Conifex produced lumber totalled 115 million board feet, a 7% decline from the previous quarter. The company continued to ship heavily to export markets, particularly China, during the first quarter of 2012 with approximately 62% of total shipment volumes going to these markets compared to 53% in the previous quarter and 44% in the first quarter of 2011.

Operating rates were 60% for the first quarter of 2012, during which the company produced 111 million board feet of lumber, compared to 51% for the previous quarter and 34% for the first quarter of 2011. Production efficiencies during the current quarter were challenged by the recent conversion of the Fort St. James mill from a three-line to two-line configuration and weather related disruptions in January.

The completion of the installation of an automated grading system at the Mackenzie Site II planer mill in April 2012 is expected to result in improved grade outturns, productivity gains from increased throughput and lower labour costs. The Company also expects an increase in production and shipments of premium grade products to Japan during subsequent quarters.

Mackenzie, B.C. bioenergy cogeneration budget

Conifex also announced that it has approved a capital expenditures budget estimated to be $79 million, including a $7 million general contingency, to develop its bioenergy cogeneration project at Mackenzie, B.C.

The $72 million amount, net of the contingency, represents an increase over previously estimated amounts with the increase largely due to the acceleration of certain project enhancements originally contemplated to be undertaken during the first three years of commercial operations and funded out of segment cash flows. The company has decided to include these additional components within the initial construction phase in order to avoid further construction related disruptions to ensuing future bioenergy activities at the site. The expanded scope is expected to increase EBITDA as a result of improved uptime and fuel efficiency and reduced operating and maintenance costs.

The existing project site and infrastructure carries a book value of approximately $10 million and as at March 31, 2012, the company has invested an additional $9.1 million in project development and equipment costs. The company expects to invest an additional $7 million in the project and expects to secure debt facilities to finance the balance of the expenditures. Proceeds of incentive funds from a Load Displacement Agreement with BC Hydro should also be available to the company. The company expects project financing to be in place and construction to commence in or about the third quarter of 2012.

Source: Conifex

Conifex Timber Inc. is reporting a net loss of $2.2 million in its third quarter on sales of $38.2 million.

Current quarter net loss improved by $1.4 million over the previous quarter. Net loss during the current quarter improved by $0.7 million over the third quarter of 2010. Overall operating rates based on current total estimated production capacity were approximately 55% during the second and third quarters of 2011 compared to 21% during the third quarter last year.

Conifex reported current quarter lumber shipments of 115 million board feet which represented an increase of 42% over the previous quarter and 260% over the same quarter last year. The increase in shipment volume was due to higher operating rates and the fulfillment of shipment orders from the previous quarter. Revenue from lumber shipments increased by 54% compared to the previous quarter and by 262% over the same quarter last year. Current quarter average WSPF 2×4 #2 & Btr prices increased by approximately 4% compared to the previous quarter and the same quarter last year once the effect of exchange rate fluctuations between the Canadian and U.S. dollar is removed.

Conifex’s geographic sales profile continued to be dominated by export markets. Approximately 72% of total current quarter shipment volumes and 68% of current year-to-date shipment volumes were to offshore markets, primarily China and Japan, compared to 49% of third quarter shipments and 41% of year-to-date shipments last year. The balance of current year-to-date shipments was split equally between the Canadian and U.S. markets.

Lumber production during the third quarter of 2011 totalled 102 million board feet and was flat compared to the previous quarter and an increase of approximately 258% over the third quarter of 2010. Operating results reflect a modest increase in unit log costs during the current quarter and year-to-date periods, modest improvement in unit cash conversion costs during the current quarter and a more significant decrease in current and year-to-date lumber segment selling, general and administration unit costs.

Conifex and its subsidiaries’ primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing. Conifex’s lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Upon completion of its bioenergy facility at Mackenzie, British Columbia, Conifex’s business segments will be expanded to include bioenergy.

Conifex’s sawmill complex situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. Conifex’s two-mill complex situated in Mackenzie, British Columbia was purchased in June 2010. One mill at Mackenzie started up on a one-shift basis in November 2010. Conifex added a second shift at Fort St. James and Mackenzie in late March 2011 and is expected to be operating at approximately 70% of capacity by the end of the third quarter of 2011. On a combined basis, Conifex now owns sawmills having an annual lumber production capacity of approximately 745 million board feet on a two-shift basis. The sawmill complexes are supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres.

Source: Conifex (read full release)

Conifex Timber Inc. has announced that it has entered into an agreement modifying certain terms of its Electricity Purchase Agreement with BC Hydro from its bioenergy operation in Mackenzie, British Columbia.

The Electricity Purchase Agreement specified a period of 150 days from the date that the agreement was entered into within which acceptance for filing by the British Columbia Utilities Commission was required.

The Amendment Agreement extends this Acceptance Period by 90 days.

The extension was put in place to allow for the completion of the Province’s review of BC Hydro prior to the filing of the Electricity Purchase Agreement with the Commission.

As a result of the filing delay, the project schedule has been impacted. Subject to the Electricity Purchase Agreement being accepted by the Commission as an energy supply contract, the company now expects that delivery of energy under the EPA to BC Hydro will occur in approximately Q2 of 2013.

The bioenergy facility will create approximately 80 jobs during its construction period, and over 20 new jobs upon completion. The feedstock from the bioenergy facility will be sourced from a portion of the residuals and former waste products produced at Conifex’s lumber manufacturing and log harvesting operations. The facility is expected to produce 230 gigawatt hours of net energy a year (or enough to power about 24,000 homes).

Source: Conifex Timber

Read more:
Conifex Adds Time to Mackenzie Bioenergy-Hydro Project (Opinion 250 News)

Conifex Timber Inc. is reporting a net loss of $3.6 million in their second quarter.

EBITDA improved by $0.5 million compared to the previous quarter and $0.1 million compared to the same quarter last year. The company added a second shift at its Fort St. James and Site II Mackenzie operations at the end of March 2011. Overall operating rates based on current total estimated production capacity improved to approximately 55% during the current quarter compared to 34% in the previous quarter and 22% for the same quarter last year.

Current quarter revenue from lumber shipments increased by 18% compared to the previous quarter and reflects a 30% increase in shipment volumes offset by a 12% decline in average unit sales prices. Average WSPF 2×4 #2 & Btr prices adjusted for a 2% appreciation of the Canadian dollar compared to the U.S. dollar declined quarter over quarter by 21%. Conifex achieved higher mill nets in the current quarter than would be indicated by the quarter over quarter decline in benchmark prices due to an improved product and grade mix, a robust order file entering the quarter, and less volatility in prices in export markets compared to the North American market.

Conifex shipped a record 83% of total second quarter shipments to export markets compared to 44% in the previous quarter and 41% in the same quarter last year. The Company’s primary export markets are China and Japan. Shipments to export markets during the first six months of 2011 represented 66% of total shipments compared to 36% for the first six months of 2010.

Current quarter lumber revenue increased by 105% compared to the second quarter of 2010 with most of the increase attributable to higher shipment volumes.

Lumber production during the second quarter of 2011 totalled 102.4 million board feet, an increase of approximately 61% over the previous quarter and 148% over the second quarter of 2010. Unit conversion costs declined by approximately 23% compared to the previous quarter and 8% compared to the same quarter last year. The improvement was largely attributable to increased operating rates during the current quarter.

Conifex’s key priority in the short term continues to be to achieve positive EBITDA from its lumber operations. Management remains focused on improving margins by optimizing value from the fibre harvested and reducing cash conversion costs.

In its bioenergy segment, Conifex is undertaking activities to progress the development of its planned bioenergy facility at its Mackenzie sawmill site. The company previously announced the completion of an Electricity Purchase Agreement and Load Displacement Agreement with BC Hydro in June 2011.

Conifex and its subsidiaries’ primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing. Conifex’s lumber products are sold in the United States, Chinese, Canadian and Japanese markets. Upon completion of its bioenergy facility at Mackenzie, British Columbia, Conifex’s business segments will be expanded to include bioenergy.

Conifex’s sawmill complex situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. Conifex’s two-mill complex situated in Mackenzie, British Columbia was purchased in June 2010. One mill at Mackenzie started up on a one-shift basis in November 2010. Conifex added a second shift at Fort St. James and Mackenzie in late March 2011 and is expected to be operating at approximately 70% of capacity by the end of the third quarter of 2011. On a combined basis, Conifex now owns sawmills having an annual lumber production capacity of approximately 745 million board feet on a two-shift basis. The sawmill complexes are supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres.

Source: Conifex Timber Inc.