Norbord records adjusted EBITDA of US$865m for 202016 February 2021
Norbord, a wholly-owned subsidiary of West Fraser Timber Co Ltd, has reported adjusted EBITDA of US$865m for the full-year 2020 compared to US$138m in 2019.
The improvement was due to significantly higher realised North American OSB prices, productivity improvements and lower raw material prices, partially offset by higher mill profit share costs attributed to higher earnings, lower shipment volumes and higher raw material usages.
North American operations generated adjusted EBITDA of US$832m compared to US$85m in the prior year and European operations delivered adjusted EBITDA of US$48m compared to US$64m in the prior year.
For the fourth quarter of 2020, Norbord reported adjusted EBITDA of US$384m compared to US$$27m in the fourth quarter of 2019.
The quarter-over-quarter increase was primarily driven by higher realized North American OSB prices, partially offset by lower shipment volumes, while the year-over-year increase was due to significantly higher North American OSB prices and higher shipment volumes.
“The past year was truly remarkable in many respects for Norbord,” said Peter Wijnbergen, president and CEO of Norbord and now president, Engineered Wood of West Fraser.
“After adjusting our production strategy in response to the demand challenges brought about by the Covid-19 pandemic in the first half of the year, OSB demand from new home construction and repair & remodeling recovered beyond expectations and forecasts in the second half, lifting North American benchmark prices to all-time highs.
“In fact, the recovery of demand was so robust that we reported back-to-back record quarterly results in the third and fourth quarters.
“In Europe, our results were more adversely impacted by the pandemic though we saw steady improvement in the back half of the year with panel prices recovering and production ramping up at the recently commissioned Inverness, Scotland Phase 2 expansion.”