Conifex Timber Inc.
TSX VENTURE : CFF

Conifex Timber Inc.

March 08, 2011 17:19 ET

Conifex Announces Fourth Quarter 2010 Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 8, 2011) - Conifex Timber Inc. ("Conifex" or the "Company") (TSX VENTURE:CFF) today reported a net loss of $3.9 million or $0.26 per share for the fourth quarter of 2010 compared to a net loss of $2.2 million or $0.52 per share for the fourth quarter of 2009. The net loss for the year ended December 31, 2010 was $10.8 million or $1.02 per share compared to a net loss of $10.3 million or $2.45 per share for the year ended December 26, 2009.

Lumber shipments for the fourth quarter of 2010 totalled 49 million board feet, an increase of 35% over the same quarter last year. Revenues from lumber sales totalled $18.2 million, an increase of 65% over the same quarter last year with the increase evenly attributable to increased volumes and to higher unit sales prices achieved. Export sales accounted for 53% of total net lumber revenue in the fourth quarter of 2010 compared to 34% during the same quarter last year.

Total lumber production during the fourth quarter of 2010 was 49 million board feet compared to 33 million board feet during the same quarter last year. The majority of the additional volume in the most recent quarter was due to the commencement of one shift operations at the Company's "Site II" manufacturing facilities in Mackenzie B.C. The start-up of operations at this location did not significantly impact overall shipments as shipments did not commence until mid-December of 2010.

Operating results for the fourth quarter of 2010 was negatively impacted by low overall operating rates of approximately 26%, production inefficiencies related to the capital improvement project currently nearing completion at the Fort St. James site, and costs related to idle facilities and typical start-up issues at the Mackenzie location,

Of the ($2.2) million EBITDA for the fourth quarter of 2010, ($0.4) million was attributable to the lumber segment, ($0.2) million to the bioenergy segment and ($1.6) million to corporate costs and other items. EBITDA was ($1.7) million for the fourth quarter of 2009 of which ($1.5) million was attributable to the lumber segment.

Conifex's key priority in the short term continues to be to achieve positive EBITDA from its lumber operations. During 2010, the Company made considerable progress towards its objective of improving overall operating rates and significantly reducing unit manufacturing costs. With its major capital improvement project nearing completion at its Fort St. James mill, Conifex expects to add a second shift at this location later this month. The Company is also planning to add a second shift at its Site II Mackenzie mill during the second quarter of 2011. With these initiatives, production is expected to reach an annualized rate of approximately 530 million board feet, equivalent to an overall operating rate of over 70% during the second half of 2011.

The Company also recently announced the initiation of a bioenergy generation project at its Mackenzie sawmill site.

Earnings Release Call

There will be a conference call held by the Company on Wednesday, March 9, 2011 at 8:00 AM (Pacific time) to discuss the fourth quarter financial and operating results. To participate in the call, please dial 416-340-2216 or toll free 866-226-1792. The call will also be available on instant replay access until April 15, 2010 by dialling 905-694-9451 or 800-408-3053 and entering participant pass code 3377045.

About Conifex Timber Inc.

Conifex and its subsidiaries' primary business 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.

Conifex's sawmill situated in Fort St. James, British Columbia was purchased in August 2008 and commenced operations on a one-shift basis in March 2009. At this mill, Conifex intends to move to a two-shift operation later this month. 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 intends to operate this mill on a two-shift basis commencing in the second 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, all supported by renewable forestry licences with an allowable annual cut of approximately 1.6 million cubic metres. 

Forward-Looking Statements

Certain statements in this news release may constitute "forward-looking statements". Forward-looking statements are statements that address or discuss activities, events or developments that the Company expects or anticipates may occur in the future. When used in this news release, words such as "estimates", "expects", "plans", "anticipates", "projects", "will", "believes", "intends" "should", "could", "may" and other similar terminology are intended to identify such forward-looking statements. Forward-looking statements reflect the current expectations and beliefs of the Company's management. Because forward-looking statements involve known and unknown risks, uncertainties and other factors, actual results, performance or achievements of the Company or industry may be materially different from those implied by such forward-looking statements. Forward-looking statements involve significant uncertainties, should not be read as a guarantee of future performance or results, and will not necessarily be an accurate indication of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including those matters described in Schedule "A" to the filing statement of the Company dated May 25, 2010 under the heading "Risk Factors", available on SEDAR at www.sedar.com. Accordingly, readers should exercise caution in relying upon forward-looking statements and the Company undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, except as required by law.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Conifex Timber Inc.
    Yuri Lewis
    Chief Financial Officer
    (778) 331-8687