West Fraser Reports Third Quarter 2026 Results Amid Challenging Market Conditions

West Fraser Timber Co. Ltd. (NYSE: WFG; TSX: WFG), a diversified wood products company, today announced its financial results for the third quarter of 2026, reporting lower sales and earnings amid continued weakness in housing-related demand and rising input costs.

Financial Performance

West Fraser reported third-quarter sales of $1.363 billion, compared with $1.434 billion in the second quarter of 2026. The company recorded a net loss of $80 million, or $1.03 per diluted share, compared with a net loss of $61 million, or $0.78 per diluted share, in the previous quarter.

Adjusted EBITDA for the quarter was $38 million, down from $59 million in Q2 2026, representing approximately 3% of sales.

Segment performance was mixed. The Lumber segment generated adjusted EBITDA of $34 million, including a favourable $12 million duties adjustment. North American Engineered Wood Products recorded a loss of $4 million in adjusted EBITDA, while Europe Engineered Wood Products generated $4 million.

Operational Adjustments and Mill Curtailments

In response to continued weakness in demand for wood products used in new home construction, repair and renovation, West Fraser announced the indefinite curtailment of its Huguley oriented strand board (OSB) mill in Lanett, Alabama, and its lumber mill in Leola, Arkansas.

The curtailments are expected to take effect in the fourth quarter of 2026 following orderly wind-downs. The measures will reduce annual OSB capacity by approximately 500 million square feet, on a 3/8-inch basis, and Southern Yellow Pine lumber capacity by 225 million board feet.

The company expects to record an asset impairment loss of approximately $200 million to $220 million in the fourth quarter in connection with these decisions.

Liquidity and Financial Position

West Fraser ended the third quarter with approximately $1.2 billion in available liquidity, including an undrawn $1 billion credit facility. Cash and short-term investments stood at $203 million as of October 2, 2026.

The company also refinanced its existing $300 million term loan, previously due in May 2028, with a new $500 million term loan maturing in September 2029. During the quarter, West Fraser repaid $55 million in operating loans.

Capital expenditures totalled $212 million during the first nine months of 2026. The company continues to expect full-year capital expenditures of $300 million to $350 million.

Market Outlook

Management expects near-term demand for North American wood products to remain challenged by housing affordability constraints, elevated mortgage rates, economic uncertainty and higher energy-related input costs.

West Fraser expects 2026 shipments of spruce-pine-fir (SPF), Southern Yellow Pine (SYP) lumber and North American OSB to be toward the lower end of its previously announced guidance ranges. European engineered wood products demand is expected to remain stable or improve modestly compared with 2025.

Over the longer term, the company identifies potential demand support from improvements in housing affordability, an ageing housing stock and the expanding adoption of timber-frame and mass-timber construction.