Vancouver’s Western Forest Products Inc. (TSX:WEF) reported its second consecutive quarter of profit after posting two-and-a-half years of losses.
The largest coastal B.C. woodland operator and lumber producer reported second quarter net income of $9.5 million, compared with a net loss of $30.1 million in the same period last year.
Improved sales totalling $181.5 million – up from $138.7 million – were one of the key contributors to the company’s positive bottom line. Significant cost reductions and increased production volumes also contributed to stronger performance.
For the first half of the year, the company posted a profit of $16.8 million compared with a net loss of $55.6 million in the same period in 2009.
Sales for the six-month period ending June 30 rose to $319.8 million from $291.3 million in the same period last year.
Describing the recovery of the global economy as extremely slow, with high unemployment and increased home foreclosures in the U.S., the company expects market uncertainty to remain with only marginal improvements in new home construction for the remainder of the year and into 2011.
It noted that modest improvements in market demand in the second quarter were largely due to distributors refilling depleted inventory rather than from any increased demand from customers.
Western Forest’s share price range during the past week: between $0.345 and $0.395; 52-week high: $0.59; 52-week low: $0.16.