A point or two In Japan, we expect demand to remain flat for our Douglas fir products, however increased competition from European engineered wood products may pressure pricing. We expect market share erosion and weaker pricing for BC coastal Hemlock lumber in Japan, due to the supply shortages as a result of the Strike and increased competition
Given the current uncertainty created by the ongoing labour dispute, unfavourable investment conditions in BC and our near-term focus on managing cash flow, we have scaled back our strategic capital investment. ,
The Company has halted all material non-committed strategic capital investment in BC. Our strategic capital program is focused on the installation of technology that will deliver top quartile performance and improve our ability to manufacture targeted products that yield the best margin. ( automating to reduce workforce )
We are committed to reaching a reasonable collective agreement that creating certainty for our employees, while maintaining our globally competitive position. We are seeking an agreement that is similar to those achieved in the Northern and Southern Interior of BC, where the United Steelworkers have ratified new collective agreements.
(No reason why this should be unacceptable)
The Strike is expected to have a negative impact on our fourth quarter results , we are unable to determine the magnitude of that impact at this time.
-----------------------------------------------------------------------------------------------------------------
There is no indication of capitulating on outlandish demands. Still financially Management planned ahead probably expecting a strike. The purchase of Columbia Vista insured there would still be a revenue stream supporting the company if strike action occured. Log exports from partnered TFL's also a corporate benifet.
However the shutdown continues, causing uncertainty. The $8.2M in Dividends is still going to be paid. Eroding the company finances during a lower revenue period with higher costs described. So I would expect a bit of a share price pull back. Offering a slightly better entry position than present.
The Union could end this by accepting an equal settlement their Brotherhood has rattified in interior mills. It is the same Province, No reason coastal workers should be remunerated higher than their inland counterparts.
From the report, The company is reasonably firm in it's position. WEF's key Management,
Chair Lee Doney, Previous Govt. official & Former Mediator himself,
CEO Don Demmons From a sawmill familly with a degree in Economics & Finance,
CFO Steven Williams who after helping to build International Forest Products Was enticed to come over to WEF by Brookfield..
These are among the highest qualified individuals in the industry. Their leadership has made WEF the company what it is today. One of only a couple in the Canadian forest industry which is financially secure, growing, a benifet to the Island economy and still paying it's share holders a dividend.
The reason why Institutional holdings constantly range in the 45% +- bracket