Western Forest Products Inc. reported an Adjusted EBITDA of negative $65.9 million for the quarter ended September 30, 2025, compared to negative $10.7 million in the same period last year, driven by a $59.5 million non-cash export duty expense.

The net loss for the quarter was $61.3 million. The results included a $6.9 million initial insurance recovery related to the Columbia Vista sawmill. Excluding the export duty expense and the insurance recovery, the underlying operational results were impacted by weak market conditions.

The company's performance was affected by a 20% decrease in lumber production to 107 million board feet and a 7% decrease in lumber shipments to 129 million board feet compared to the Q3 2024. The average lumber selling price increased 2% to $1,409 per thousand board feet.

The $59.5 million non-cash expense was recorded following the final determination of softwood lumber duty rates from the sixth Administrative Review by the U.S. Department of Commerce. The company also noted the imposition of a new, incremental 10% U.S. tariff on imported lumber products effective October 14, 2025.

The company reduced its net debt by $15.7 million from the previous quarter to $11.6 million, improving its net debt to capitalization ratio to 2%. Liquidity increased to $234.2 million, supported by working capital reductions and a new USD $30 million letter of credit facility. Planned 2025 capital expenditures were reduced to a range of $30 to $35 million.

The company took 30 million board feet of lumber production curtailments during the quarter. A labor strike at the La-kwa sa muqw Forestry Limited Partnership, which commenced in the second quarter, remains ongoing.

Western stated that North American markets are expected to remain weak due to high interest rates, low consumer confidence, and elevated U.S. channel lumber inventories, with the new 10% tariff further complicating dynamics. Markets may start to improve towards the end of the Q4 2025 or into early 2026. The company plans to take 35 million board feet of lumber production curtailments in the Q4 2025. The first of two continuous dry kilns is anticipated to be completed in early 2026, with the second expected in mid-2026. The insurance process for the Columbia Vista sawmill remains ongoing, and the company continues to work with insurers to determine available proceeds.