2012 financial results of Canadian forest sector
April 16, 2013
Analysis of the 2012 financial results of the largest publicly traded Canadian forest sector firms indicate that companies with major exposure to solid wood products significantly improved their performance, while companies with more exposure to pulp and paper products posted either declining or negative net income. In 2012, the ten largest publicly traded Canadian forest companies, measured by revenue, were: Canfor, Cascades, Catalyst, Domtar, Mercer, Norbord, Resolute, Tembec, West Fraser and Western FP. Cumulatively, they reported a net income of $871 million, compared with a net loss of $378 million in 2011 (see figure).
Financial results of the largest Canadian publicly traded forest companies1
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Six of these 10 firms reported positive net earnings in 2012, the same number as in 2011.
The diverging trend for wood manufacturers and pulp and paper firms is driven by continued growth in Asian demand and on-going recovery in the U.S. housing sector driving wood product shipments and prices up, while demand for newsprint and other graphic papers continues to be challenged by falling demand as a result of the rise of electronic media. Both of these trends are expected to continue, and will likely continue to impact financial performance over the next few years.