Greenfirst Forest Products Inc · TSX:GFP
Greenfirst Forest Products — Q3 2023 Earnings Presentation
22 slides from Greenfirst Forest Products's earnings presentation, Nov 14, 2023
Slide 1: Q4 and Year Ended 2022 Investor Presentation
Q4 and Year Ended 2022 Investor Presentation March 15, 2023
Slide 2: Legal Disclaimer
Legal Disclaimer 2 This Presentation is being provided to you by GreenFirst Forest Products Inc. (“GreenFirst” or the “Company”) for informational purposes only. Cautionary Note Regarding Forward-Looking Information This Presentation includes information, statements, beliefs and opinions which are f
Slide 3: Presenters
Presenters 3 Paul Rivett Alfred Colas Michel Lessard Interim CEO CFO President and Chairman
Slide 4: Overview
OVERVIEW GREENFIRST
Slide 5: Key Achievements
Key Achievements 5 § Opened a new corporate back office in North Bay, Ontario, making us closer to the forests and the mills we operate. § Graduated from the TSX venture exchange to the TSX main board. § Partnered with a Schedule 1 Canadian Bank to provide a credit facility to replace our acquisitio
Slide 6: Valuable Attributes
Valuable Attributes 6 Strong Over-Funded Parcels of SAWMILLS PENSION LAND Four operating sawmills Over-funded pension Over 4,000 acres of with 510Mfbm annual with a 27% funding property, with key production capacity surplus that was safe- developable lots in and 2.6 million cubic harboured through K
Slide 7: Q4'22 Overview – Tough industry-wide quarter
Q4'22 Overview – Tough industry-wide quarter 7 Results from continuing operations Q4 Net (Loss) Earnings Q4 - $(25.9) million / Diluted EPS $(0.15) Q4 loss includes $8.9 million charge for inventory write downs to their net realizable values Q4 EBITDA and Adjusted EBITDA Q4 - $(19.4) million / $(27.
Slide 8: Outlook – Pricing and Costs
Outlook – Pricing and Costs 8 § Near-term demand shows volatility, however, longer-term fundamentals for lumber demand remain favourable. § Inflation and rapidly increasing interest rates having a negative impact on lumber markets. § Some price support due to curtailments in BC and other parts of No
Slide 9: Lumber has been a markedly more volatile commodity
Lumber has been a markedly more volatile commodity 9 Lumber Futures Price Performance vs. Selected Commodities 500 450 400 Future prices indexed to Jan. 2010 350 300 250 200 150 100 50 - 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Lumber Copper Iro n Corn Brent Crude Oil Source: Bloomberg
Slide 10: Gradual decline of Canadian lumber sales into the US
Gradual decline of Canadian lumber sales into the US 10 US Softwood Lumber Consumption by Source 40% 250 200 30% % of total US lumber consumption Quantity indexed to 2002 150 20% 100 10% 50 0% 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Slide 11: Inflation and interest rates continue to weigh heavily on demand
Inflation and interest rates continue to weigh heavily on demand 11 Federal Funds Rate vs. US Consumer Price Index 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% - (1.0%) Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 Jul-17 Jul-18 Jul-19 Jul-20 Jul-21 Jul-22 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14
Slide 12: Lumber represents a small proportion of the construction cost of a new home
Lumber represents a small proportion of the construction cost of a new home 12 Homebuilder estimated cost structure 6% 3% 4% 3% Land 30% Labour Other Materials Lumber Amortized Interest 25% Closing Cost Overhead/Other 29% Source UBS Research
Slide 13: Demand for new housing continues to outpace supply
Demand for new housing continues to outpace supply 13 120 25,000 US Immigration and Family Formation vs. New Home Builds 115 Immigration and Households 20,000 Home Builds (in 000s) 110 indexed to 2010 105 15,000 100 95 10,000 90 85 5,000 80 75 - 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Slide 14: Financials
FINANCIALS GREENFIRST
Slide 15: Q4'22 Financial Highlights - P&L
Q4'22 Financial Highlights - P&L 15 In thousands of Canadian Dollars, except per share amounts (1) Certain prior period amounts have been restated as a result of the Company finalizing its purchase price accounting related to the Rayonier Asset Acquisition, as allowed under IFRS. Please refer to Not
Slide 16: 2022 Financial Highlights - P&L
2022 Financial Highlights - P&L 16 In thousands of Canadian Dollars, except per share amounts (1) Certain prior period amounts have been restated as a result of the Company finalizing its purchase price accounting related to the Rayonier Asset Acquisition, as allowed under IFRS. Please refer to Note
Slide 17: Liquidity
Liquidity 17 In thousands of Canadian Dollars 1 Total debt outstanding consists of the carrying amounts of the Company’s credit facilities. § The Company had a balance of $39.0 million drawn down as at December 31, 2022, reflecting the repayment of $30 million during the fourth quarter, from the pro
Slide 18: Operations
OPERATIONS GREENFIRST
Slide 19: Operational Update
Operational Update 19 Paper mill § Paper increased in Q4’22 vs. Q3’22 § Paper shipments increased in Q4'22 vs. Q3’22 § The second paper machine increased production in Q1’23 § Trending in the right direction Sawmills § Lumber shipments increased slightly in Q4'22 vs. Q3'22 § Q4'22 vs. Q3’22 saw incr
Slide 20: Annual Lumber Production Capacity
Annual Lumber Production Capacity 20 100% Canadian Sawmills Annual Production Capacity (mfbm) Chapleau 135,000 Cochrane 160,000 Hearst 110,000 Kapuskasing 105,000 Total Sawmills 510,000 Paper Mill Annual Production Capacity (MT) Kapuskasing 205,000
Slide 21: Deeply Committed to Sustainability
Deeply Committed to Sustainability 21 GreenFirst is dedicated to maintaining high standards of sustainability across our business practices § Wood stores carbon and is the only renewable major building material Green § Lumber building materials require less energy to produce and transport than Advan
Slide 22: Merci Beaucoup
Merci Beaucoup PRODUITS FORESTIERS (at GREENFIRST FOREST PRODUCTS
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