TD Q1 estimate $6.94
The consensus is up to $6.89 now, according to TD and theyr'e slightly above that.
Their EBITDA est is $588.4m vs $603.6 consensus.
Positives:
Expected Q1/22 EBITDA is 5x the av erage Q1 result ov er the past fiv e years and 1 9% abov e our estimate of annual mid-cycle (trend) EBITDA
. • Average Q1/22 lumber prices for relevant regional benchmarks improved 6 8-7 8% q/q, approaching record levels from Q2/2 1.
• EACOM acquisition closed February 22 (strong contributions mitigated by material purchase price accounting adjustment).
• Generally smooth flow of aggregate production and shipments
Lack of seasonal downtime
BC stumpage cost relief
Negatives:
Broad-based cost inflation across freight, supplies and labour.
• Ongoing challenging logistics.
• Modest log cost inflation in the U.S. South (tied to contractor availability limitations
• Fire at the Timmins ). , ON sawmill (part of the EACOM acquisition).
The big mystery is shipments and how smoothly that went. Given the challeges elsewhere, it's a bit fanciful to imagine it was smooth at Interfor.
TD "With widespread railcar and trucking availability challenges, we believe that production curtailments were a factor across the sector as companies sought to manage inventories, particularly in western Canada. Canadian lumber shipments to the U.S., as tracked by Global Affairs Canada, declined 6% q/q and 10% y/y. Broad-based inflation for freight, labour, fuel, chemicals, resin, and fibre are expected to undermine margins. Lower stumpage costs in B.C. and old corrugated container prices (a paper packaging input) bucked the general trend and will be positive offsets"