Interfor Reports Q1’26 Results
Press Release
May 14, 2026
INTERFOR CORPORATION (“Interfor” or the “Company”) (TSX: IFP) recorded a net loss in Q1’26 of $63.3 million, or $0.96 per share, compared to a net loss of $104.6 million, or $1.59 per share in Q4’25 and a net loss of $35.1 million, or $0.68 per share in Q1’25.
Adjusted EBITDA was $30.7 million on sales of $643.2 million in Q1’26 versus an Adjusted EBITDA loss of $29.2 million on sales of $600.6 million in Q4’25 and Adjusted EBITDA of $48.6 million on sales of $735.5 million in Q1’25.
⦁ Operational Highlights
o Lumber prices increased during Q1’26 as reflected in Interfor’s average selling price of $666 per mfbm, up $67 per mfbm versus Q4’25. Lumber prices strengthened across all operating regions primarily from the effects of the industry-wide production curtailments in 2025 and seasonal demand.
o Lumber production of 856 million board feet was up 103 million board feet versus the preceding quarter driven primarily by higher operating rates at the U.S. Northwest and B.C. operations.
Q4’25 production was impacted by temporary production curtailments in response to weak market conditions.
o Due to weak market conditions and other factors, Interfor indefinitely curtailed operations at its Ear Falls, Ontario sawmill in Q1’26 and at its Nairn and Gogama, Ontario sawmills in April 2026.
o Lumber shipments of 806 million board feet were approximately 6% lower than lumber production, resulting in a 52 million board foot increase in inventory volume during the quarter. The shortfall of lumber shipments compared to production was primarily the result of logistics constraints across the U.S. towards the end of the quarter.
⦁ Financial Position
o During the quarter the Company completed a series of previously announced financing transactions, which taken together significantly strengthened the Company’s financial flexibility.
o The Company’s available liquidity improved $14.5 million quarter-over-quarter to $385.8 million at March 31, 2026 and the Company had net working capital of $249.8 million as at March 31, 2026.
o The Company generated $23.8 million of positive operating cash flow before working capital changes in Q1’26, primarily due to higher average lumber prices. $22.9 million was invested in working capital, driven primarily by lumber shipment delays resulting from logistics constraints and seasonally higher log inventories in Canada.
o Net debt at quarter-end was $857.7 million, or 38.3% of invested capital compared to net debt at Q4’25 of $797.6 million, or 36.5% of invested capital.
⦁ Capital Initiatives
o Capital spending was $35.2 million, including $27.6 million of discretionary investment primarily focused on the multi-year rebuild of the Thomaston, GA sawmill. The comprehensive rebuild of the Thomaston, GA sawmill was completed during the quarter and is currently ramping up as expected towards the pro forma production capacity of 240 million board feet per year.
o As previously announced, the Company plans to sell certain property, plant and equipment of two operations in the U.S. South and the impending sale of these operations resulted in an impairment charge of $11.4 million and a loss on disposal of $27.2 million related to goodwill in
Q1’26.
⦁ Export Duties and Tariffs
o On April 9, 2026, the U.S. Department of Commerce (“DoC”) issued its preliminary anti-dumping (“AD”) and countervailing (“CV”) duty rates for a combined all others rate of 24.83% for its seventh administrative review covering shipments for the year ended December 31, 2024. The preliminary rate is subject to change until the final rate determinations, which are expected to be published in the second half of 2026. Based on the preliminary combined all others rate, a non-cash incremental expense, inclusive of interest, of approximately US$73.0 million is expected to be recorded in the second half of 2026.
o The DoC is in the process of liquidating AD duties for the first administrative review covering exports between August 26, 2017 to December 27, 2017 and the Company expects US$5.2 million to be refunded in the second quarter of 2026. As of the date of this press release, US$3.8 million has been received by the Company.
Outlook
North American lumber markets over the near term are expected to remain volatile as the economy continues to adjust to changing monetary policies, tariffs, oil price volatility and geo-political uncertainty, and as industry-wide lumber production continues to adjust to match demand.
Benchmark lumber prices rebounded in Q1’26 and the upward momentum continued into early Q2’26, with the SYP Composite lumber price rising US$118 per mfbm or 35%, the KD H-F Stud 2×4 9’ lumber price rising US$103 per mfbm or 24%, the Western SPF Composite lumber price rising US$82 per mfbm or 20% and the Eastern SPF Composite lumber price rising US$66 or 14% from the end of December 2025 through to the end of April 2026. Industry-wide market curtailments, seasonal demand factors and logistics constraints, particularly in the U.S., are expected to drive ongoing price fluctuations in 2026.
Near-term volatility is likely to be amplified by the significantly higher duty rates on Canadian lumber exports to the U.S., the Section 232 tariff and by any additional tariffs or other trade restrictions, if imposed. Overall, the Company is well positioned to navigate this volatility with a diversified product mix in Canada and the U.S., with approximately 65% of its total lumber produced and sold within the U.S. Ultimately, only about 20% of the Company’s total lumber production is exported from Canada to the U.S. and exposed to duties, tariffs or other potential trade measures. Oil price fluctuations are also expected to drive ongoing volatility in end-use demand, logistics costs and raw material purchases, while at the same time potentially hindering offshore imports from Europe.
Over the mid-term, Canadian lumber is expected to remain a key source of supply to meet U.S. needs, as growth in U.S. lumber manufacturing capacity will likely be limited by labour constraints, lengthy equipment lead-times, residual offtake constraints and extended project ramp-up schedules. Over the same period, the North American lumber market is expected to continue to benefit from favourable underlying demand fundamentals, including the advanced age of the U.S. housing stock, a shortage of available housing and various demographic factors.
Interfor’s strategy of maintaining a diversified portfolio of operations in multiple regions allows the Company to both reduce risk and maximize operating margins over the business cycle.
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