Earnings call transcript: West Fraser Timber Q3 2026 profit slips as housing stays weak

West Fraser Timber reported weaker third-quarter earnings and sales due to softer pricing, increased costs, and a weak housing market. The company's Q3 2026 sales fell to $1.36 billion from $1.43 billion the previous quarter, while adjusted EBITDA dropped to $38 million from $59 million. Shares declined 1.8% to $93.70, below the 52-week high of $105.25.

The lumber segment recorded a $34 million adjusted EBITDA loss, impacted by weaker OSB pricing and higher resin costs. West Fraser refinance debt, boosting liquidity to about $1.2 billion with net debt to capital at 6%. Despite challenges, the company maintains profitability and cash generation. Sales dropped sequentially, and adjusted EBITDA margin declined to about 3% from 4.1% in Q2.

Demand remains weak due to high mortgage rates, affordability issues, and cautious consumer and builder confidence. The company's strong liquidity position includes $200 million in cash and an undrawn $1 billion revolver. Analysts note the company's dividend payments for 41 consecutive years but do not anticipate profitability this year.