Canfor Corp. (TSX:CFP) reported a net income of $32.3 million for 2011’s first quarter, compared with $55.4 million in 2010’s fourth quarter.
The company cited the stagnant U.S. housing sector and severe winter weather conditions across North America that impeded lumber delivery as reasons for the decline.
While the company’s lumber production was up 7%, shipments were down– a reflection of major transportation disruptions.
Canfor president and CEO Jim Shepard said, “We continue to believe that the road to recovery for the U.S. housing market is likely to be a long one, but we are clearly seeing the benefits of the work we have done in developing our Asian markets, particularly China.”
The release noted that, despite a projected seasonal uplift in home construction, repair and renovation, the U.S. housing market is not forecast to show any significant recovery through the balance of the year, given the current high levels of mortgage delinquencies, home foreclosures and home inventories.
The Canadian housing market, although flat in the first quarter, is forecast to show moderate improvement in the second quarter.
Strong demand in China for wood products is projected to continue through the balance of the year, while the near-term outlook for Japan is more uncertain in the aftermath of March’s earthquake and tsunami.
Shepard concluded, “The past four years have shown that Canfor has the strength to endure the worst markets in many decades. That’s why I can confidently say that Canfor is ready to take advantage of the opportunities and respond to the challenges that lie ahead.”
Jennifer Harrison