Norbord reports strong demand in Q1

4 May 2017

Panel producer Norbord’s European operations has reported continuing strong demand in Q1, with double-digit demand growth in both the UK and Germany.

The company said OSB was continuing to gain market share from plywood.

Its European operations delivered adjusted earnings before interest tax, depreciation and amortisation (EBITDA) of US$6m (Q1 2016: US$10m).

Peter Wijnbergen, Norbord’s president and CEO, said in Europe the company continued to face a post-Brexit translation headwind from the weaker Pound Sterling, and Q1 included the additional impact of higher resin prices that exceeded the panel price increases it had recorded to-date.

He said in local currency terms, OSB prices in the UK were 5% higher than the same quarter last year and have firmed by about 10% since their post-Brexit lows. On the continent, OSB prices were 3% lower than the same quarter last year but flat versus the prior quarter.

UK MDF and particleboard prices were up 8% and 3%, respectively versus both comparative periods.

"Our project to modernize and expand the Inverness, Scotland OSB mill to serve this rapidly growing customer demand remains on budget and on track to start up in the second half of this year,” said Mr Wijnbergen.

Group-wide Norbord Inc recorded Q1 adjusted EBITDA of $103m (Q1 2016 US$61m).