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Bullboard - Stock Discussion Forum Canfor Pulp Products Inc T.CFX

Alternate Symbol(s):  CFPUF

Canfor Pulp Products Inc. is a Canada-based global supplier of pulp and paper products with operations in the central interior of British Columbia (BC). The Company operates through two segments: pulp and paper. The pulp segment includes purchase of residual fiber, and production and sale of pulp products, including Northern Bleached Softwood Kraft (NBSK) pulp and Bleached Chemi-Thermo... see more

TSX:CFX - Post Discussion

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Post by Nbsk on Apr 29, 2021 12:53pm

Q1

Production was running great, volume, cost -wise, but sales were underwhelming. Up only 10% from Q4. We need to consider they built inventories, shipped quite less than produced.

 

They provide an explanation that hints at strong Q2 (bold is mine):

 

"Reflecting the lag between orders and shipments, the significant majority of these price gains will be realized in the second quarter."

 

It seems the "missing" earnings are in inventories. It's not hidden, it's disclosed, but keep in mind these bulked-up pulp inventories are carried at cost... In sum, it’s postponed. Bummer for short term traders. Headlines of sales/earnings are not enough to gauge Q1, must look at the improving book value, inventories, and consider realization lag. More price increases from April, steady futures, and this same lag effect should carry beyond Q2 into a strong Q3. Still bullish and patient for the reward.

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