West Fraser Timber Co. Ltd. · TSX:WFG
West Fraser Timber — Investor Presentation (March 2021)
26 slides from West Fraser Timber's investor presentation, March 2021
Slide 1: Investor Presentation
Investor Presentation March 2021
Slide 2: Forward-looking statements
2 General: This presentation contains “forward-looking information” and “forward-looking statements” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of the U.S. Securities Act of 1933, the U.S. Securities Exchange Act of 1934, and the “sa
Slide 3: West Fraser Overview
West Fraser Overview
Slide 4: West Fraser delivers: Responsible, Resourceful and Climate-Smart
4 Responsible, Resourceful and Climate-Smart West Fraser Norbord Combined West Carbon Stored in Carbon stored in wood products 9.4 million 5.8 million 15.2 million Products (2019: in tCO2e) Fraser delivers GHG Emissions Scope 1 and 2 GHG emissions 1,494.0 662.4 2,156.4 (2019, thousands of tCO2e) cli
Slide 5: A Global Wood Products Leader
5 A Global Wood Products Leader West Fraser’s diverse wood products portfolio recently expanded with the addition of a leading EMPLOYEES WORLDWIDE LUMBER MILLS PULP & PAPER 850 GWH RENEWABLE MILLS ENERGY FACILITIES global oriented strand board (OSB) producer Created the destination provider for
Slide 6: Greater Diversity in Products, Geography and End Use
Growth, Stability, Resilience: Greater Diversity in Products, Geography and 6 End Use
Slide 7: Operating Footprint on Two Continents
Operating Footprint on Two Continents 7
Slide 8: More Relevant, Efficient and Valuable to Principal Customer Segments
More Relevant, Efficient and Valuable to Principal Homebuilder, 8 Building Construction and Pro-Dealer Customer Segments
Slide 9: West Fraser is a Market Leader with Evolving Lumber Capacity
9 West Fraser is a Market Leader with Evolving Lumber Capacity 2004 Capacity 2.8 Billion feet US South 11% West Fraser 11% Alberta 12% Weyerhaeuer British 9% Columbia 77% 2020 WFG Canfor Other Production 44% 8% 6.0 Bfbm Georgia-Pacific 2020 Capacity 6.7 Billion feet Tolko 5% British 2% Columbia Inte
Slide 10: West Fraser is a Leading OSB Producer
10 West Fraser is a Leading OSB Producer West Fraser Panel Capacity by Region Europe 21% US 37% 11.1 Bsf-3/8"(1) North American OSB Industry European OSB Industry Other Martco 6% West Canada Other 6% Fraser 42% 16% Huber 28% Smartply 8% Sonae- 4% Kronospan Arauco 40% Tolko Industry Industry 5% 8% Ca
Slide 11: North America Lumber and OSB EBITDA Margins Trending Upward
11 West Fraser North America Lumber and OSB EBITDA Margins Trending Upward 45% 40% 35% 30% 25% 20% 15% 10% Lumber Average: 15% OSB Average: 21% 5% 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Lumber OSB Note: Lumber EBITDA is after duties Improving demand, capital and operational execut
Slide 12: Pro Forma Capitalization
12 Pro Forma Capitalization Pro Forma Available Liquidity at 31 Dec 2020 West PF New West (US$ millions) (US$mm) Norbord $2,500 Fraser Fraser(1) $2,000 Market Cap(2) $4,411 (1) $3,488 (1) $7,916 (1,2) $1,500 $1,000 Long-term Debt $500 $665 $1,165 $500 Cash & Equivalents $461 $568 $1,029 $0 WF Norbor
Slide 13: Market Overview
Market Overview
Slide 14: Demand Conditions for Wood Building Products and Fiber
14 Demand Conditions for Wood Building Products and Fiber U.S. Housing Starts (not seasonally adjusted) Leading indicator of Remodeling Activity $B 4 Qtr Moving Improvements and Repairs 160.0 $400 14.0% 140.0 $350 12.0% 4 Qtr Moving rate of Change 120.0 $300 10.0% 100.0 M Starts $250 80.0 8.0% Seaso
Slide 15: North America Wood Products End-Use
North America Wood Products End-Use Driven by Demand in New Residential 15 and Lower-Volatility R&R Markets North America Lumber End Use 2020 Domestically Produced Panel Consumption 2019 Non-residential Other 22 MDF 20.9 6% 20 Particleboard SW Plywood HW Plywood OSB 22% 18 Industrial New 16 Resident
Slide 16: North American Lumber Supply Conditions
16 North American Lumber Supply Conditions Total North America Lumber Supply (Production) North America Lumber Supply (Production) 20.0 2020 Canada Other 15.0 24% Billion Board Feet US South 35% 10.0 5.0 US Other BC 0.0 26% 15% Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20
Slide 17: Lumber Production Mix Continues Shift to US South
17 North American Lumber Production Mix Continues Shift to US South 90 25 US Housing US Housing Starts Starts 80 2.1 Million 1.4 Million 20 70 60 15 Billion BF Billion BF 50 40 10 30 20 5 10 0 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Canada US US South (R axi
Slide 18: North American OSB Industry Stated Capacity
18 North American OSB Industry Stated Capacity of ~27 Bsf with Few Idled Mills The picture North American OSB Installed Capacity: can't The be di picture can't be di 33 Mills in Operation 11 Mills (Re)started in 2012/13 & 2017/18 3 Mills Idle(1) 1 Mill Permanently Closed in 2020(2) West Fraser Mill
Slide 19: North American Lumber Prices Trending Higher
North American Lumber Prices Trending Higher 19 SPF 2x4 Benchmark History $/Mfbm $1,200 $988 $1,000 $800 $629 $600 $403 $400 $200 $312 $245 $153 $- 2006 2008 2010 2012 2014 2016 2018 2020 2021 SPF 2x4 W Cycle Trough Cycle Peak Column2 Linear (SPF 2x4 W) Linear (SPF 2x4 W) $/Mfbm SYP 2x4 Benchmark Hi
Slide 20: North American OSB Prices in Multi-year Uptrend
North American OSB Prices in Multi-year Uptrend 20 North Central Benchmark OSB Price $500 $450 $400 Annual Average NC Price US$ per Msf 7/16" $350 $300 Average: $258 $250 $200 $150 $100 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Q1 163 175 423 364
Slide 21: West Fraser Timber Co. Ltd. TSX and NYSE: WFG
21 West Fraser Timber Co. Ltd. These materials have been prepared by Management of the Company. No regulatory authority has approved or disapproved TSX and NYSE: WFG of the contents of these materials. These materials do not constitute an offer to sell or the solicitation of an offer to buy any secu
Slide 22: Appendix
Appendix
Slide 23: Analyst Estimates
23 Analyst Estimates (SPF & SYP US$/Mfbm, OSB US$/Msf (7/16" basis), China NBSK US/tonne) 2021 SPF 2x4 2021 SYPW 2x4 2021 OSB NC 7/16” 2021 China NBSK RJ $550 BNS $530 RJ $400 RJ $612 BNS $556 RJ $550 BNS $430 RBC $622 TD $569 RBC $575 TD $444 BMO $632 RBC $588 TD $608 RBC $450 BNS $633 BMO $644 BMO
Slide 24: Analyst Coverage
24 Analyst Coverage Organization Analyst Name Contact BMO Capital Markets Mark Wilde (212) 883-5102 mark.wilde@bmo.com CIBC World Markets Hamir Patel (604) 331-3047 hamir.patel@cibc.com ERA Forest Products John Cooney (604) 267-3021 jcooney@era-research.com Research Raymond James Daryl Swetlishoff (
Slide 25: Sustainability Reporting
25 Sustainability Reporting Full 2019 ESG Report SASB, GRI & TCFD disclosures westfraser.com/ESG-Report ESG Report Highlights http://bit.ly/WF-ESG-2019 Attractive ESG attributes, significantly upgraded reporting
Slide 26: Non-IFRS Measures and External Information
26 Non-IFRS Measures: This presentation makes reference to certain non-IFRS measures, such as Adjusted EBITDA and net debt to capital ratio. Non-IFRS measures do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by others. Fo
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