West Fraser Timber Co Ltd (WFG) 2025 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome the West Fraser's second-quarter 2025 results conference call. (Operator Instructions)

女士們、先生們，早安，歡迎參加 West Fraser 2025 年第二季業績電話會議。（操作員指示）

During this conference call, West Fraser's representatives will be making certain statements about West Fraser's future financial and operational performance, business outlook and capital plans. These statements may constitute forward-looking information or forward-looking statements within the meaning of Canadian and United States Securities tools. Such statements involve certain risks, uncertainties and assumptions, which may cause West Fraser's actual or future results and performance to be materially different from those expressed or implied in these statements. Additional information about these risk factors and assumptions is included both in the accompanying webcast presentation and in our 2024 annual MD&A and annual information form as updated in our quarterly MD&A, which can be accessed on West Fraser's website or through SEDAR+ for Canadian investors and EDGAR for United States investors.

在本次電話會議中，West Fraser 的代表將就 West Fraser 未來的財務和營運業績、業務前景和資本計劃發表一些聲明。這些聲明可能構成加拿大和美國證券工具意義內的前瞻性資訊或前瞻性陳述。此類聲明涉及某些風險、不確定性和假設，可能導致 West Fraser 的實際或未來結果和業績與這些聲明中表達或暗示的結果和業績有重大差異。有關這些風險因素和假設的更多資訊包含在隨附的網路廣播簡報以及我們的 2024 年年度 MD&A 和年度資訊表中，這些內容在我們的季度 MD&A 中更新，可透過 West Fraser 的網站或透過 SEDAR+（加拿大投資者）和 EDGAR（美國投資者）存取。

I would now like to turn the conference call over to Sean McLaren, President and Chief Executive Officer. Please go ahead.

現在，我想將電話會議交給總裁兼執行長 Sean McLaren。請繼續。

Thank you, Jenny. Good morning, everyone, and thank you for joining our second-quarter 2025 earnings call. I am Sean McLaren, President and CEO of West Fraser. And joining me on the call today are Chris Virostek, Senior Vice President and Chief Financial Officer; Matt Tobin, Senior Vice President of Sales and Marketing; and other members of our leadership team. On the earnings call this morning, I will begin with a brief overview of West Fraser's Q2 2025 financial results and then pass the call to Chris for additional comments before I share some thoughts on our outlook and offer concluding remarks.

謝謝你，珍妮。大家早安，感謝您參加我們的 2025 年第二季財報電話會議。我是 Sean McLaren，West Fraser 總裁兼執行長。今天與我一起參加電話會議的還有高級副總裁兼財務長 Chris Virostek、銷售和行銷高級副總裁 Matt Tobin 以及我們領導團隊的其他成員。在今天早上的財報電話會議上，我將首先簡要概述 West Fraser 2025 年第二季度的財務業績，然後將電話轉給 Chris 以徵求更多評論，然後我會分享一些關於我們前景的想法並給出總結性發言。

West Fraser generated $84 million of adjusted EBITDA in the second quarter of 2025, representing an approximate 6% margin as we continue to operate within a cyclical downturn. After several months of relatively stable homebuilding markets, new home construction has more recently taken a step lower with annualized US housing starts averaging just 1.32 million units on a seasonally adjusted basis in the second quarter as relatively elevated mortgage and interest rates have continued to present headwinds to US housing demand and affordability.

2025 年第二季度，West Fraser 的調整後 EBITDA 為 8,400 萬美元，利潤率約為 6%，因為我們仍在周期性低迷時期運作。經過幾個月相對穩定的住宅建築市場之後，新房建設近期有所下降，第二季度美國新房開工年化平均數量經季節性調整後僅為 132 萬套，原因是相對較高的抵押貸款和利率繼續對美國住房需求和負擔能力構成阻力。

Repair and remodeling demand has also appeared to be impacted by these broader macro factors remaining somewhat subdued again this quarter. As an additional consideration we continue to deal with the shifting landscape of tariffs and their possible inflationary effects that have the potential to moderate future demand for our wood building products. We'll continue to watch these developments closely.

維修和改造需求似乎也受到這些更廣泛的宏觀因素的影響，本季再次保持一定低迷。作為額外的考慮，我們將繼續應對關稅的變化及其可能產生的通膨影響，這些影響可能會緩和未來對我們木製建築產品的需求。我們將繼續密切關注這些事態發展。

These factors notwithstanding, our balance sheet continues to demonstrate strength as we exited Q2 with nearly $1.7 billion of available liquidity and a strong cash position net of debt. A strong balance sheet and liquidity profile, along with our investment-grade rating remain key elements of our capital allocation strategy, which allows us to invest in our business countercyclically and take advantage of growth opportunities if and when they arise.

儘管有這些因素，我們的資產負債表仍然表現強勁，因為我們在第二季結束時擁有近 17 億美元的可用流動資金和強勁的淨債務現金狀況。強勁的資產負債表和流動性狀況以及我們的投資等級評級仍然是我們資本配置策略的關鍵要素，這使我們能夠逆週期投資於我們的業務，並在出現成長機會時抓住它們。

With that brief overview, I'll now turn the call to Chris for additional detail and comments.

有了上述簡要概述，我現在將電話轉給克里斯，以了解更多細節和評論。

Thank you, Sean. And a reminder that we report in US dollars and all my references are to US dollar amounts, unless otherwise indicated. The lumber segment posted adjusted EBITDA of $15 million in the second quarter compared to $66 million adjusted EBITDA in the first quarter.

謝謝你，肖恩。需要提醒的是，我們以美元報告，並且我所有的參考都是美元金額，除非另有說明。木材部門第二季調整後 EBITDA 為 1,500 萬美元，而第一季調整後 EBITDA 為 6,600 萬美元。

With the sequential change driven largely by lower pricing, higher fiber costs, and inventory valuation adjustments required due to the drop in lumber pricing close to the end of the quarter. Our North America EWP segment generated $68 million of adjusted EBITDA in the second quarter down from $125 million in the first quarter, with the sequential change driven largely by lower OSB pricing and inventory valuation adjustments.

連續變化的主要原因是價格下降、纖維成本上升以及由於本季末木材價格下跌而需要進行庫存估價調整。我們的北美 EWP 部門第二季的調整後 EBITDA 為 6,800 萬美元，低於第一季度的 1.25 億美元，環比變化主要是由於 OSB 定價和庫存估價調整較低所致。

The Pulp and Paper segment generated negative $1 million of adjusted EBITDA in the second quarter compared to $7 million in the first quarter, with the sequential change, again, largely attributable to an inventory write-down. Conversely, our European business posted a $2 million of adjusted EBITDA in the second quarter versus negative $2 million in the first quarter, with a sequential improvement linked to higher OSB pricing and shipments in the UK and European markets.

紙漿和造紙部門第二季的調整後 EBITDA 為負 100 萬美元，而第一季為 700 萬美元，這一環比變化主要歸因於庫存減記。相反，我們的歐洲業務在第二季度公佈的調整後 EBITDA 為 200 萬美元，而第一季為負 200 萬美元，這一環比改善與英國和歐洲市場的 OSB 價格上漲和出貨量增加有關。

In terms of our overall Q2 results, lower product prices for our lumber and North American OSB products and inventory valuation adjustments were the largest contributing to tractors as compared to Q1. While supply and demand experienced imbalances for a number of our key products in the second quarter, we were able to see some of the financial benefits of the portfolio optimization initiatives we've previously undertaken. This approach allowed us to shift select production from higher cost mills to a number of our lower cost operations, helping to mitigate some downside financial exposure.

就我們第二季的整體業績而言，與第一季相比，我們的木材和北美 OSB 產品的產品價格下降以及庫存估價調整是拖拉機銷量下降的最大原因。雖然第二季我們的一些主要產品出現了供需失衡的情況，但我們仍然能夠看到先前採取的投資組合優化舉措帶來的一些財務效益。這種方法使我們能夠將精選生產從成本較高的工廠轉移到一些成本較低的工廠，有助於減輕一些下行財務風險。

Cash flow from operations was $285 million in the second quarter with our net cash balance at $310 million, up from $156 million in the prior quarter. The relative increase in our net cash balance reflects the large seasonal release of working capital, offset in part by lower earnings, $78 million of capital expenditures and nearly $60 million of cash deployed towards share buybacks and dividends. I'm also pleased to note that in the second quarter, we successfully amended and extended our $1 billion credit facility and increased our -- and extended our $300 million term loan, up from the prior $200 million.

第二季經營現金流為 2.85 億美元，淨現金餘額為 3.1 億美元，高於上一季的 1.56 億美元。我們的淨現金餘額相對增加，反映了營運資本的大量季節性釋放，但部分被較低的收益、7800 萬美元的資本支出以及用於股票回購和股息的近 6000 萬美元的現金所抵消。我還很高興地註意到，在第二季度，我們成功修改並延長了 10 億美元的信貸額度，並將定期貸款從先前的 2 億美元增加到 3 億美元。

In terms of guidance for 2025, both our Lumber and North American OSB segments continue to experience softer-than-expected demand levels, owing to ongoing challenges with housing affordability and repair and remodeling markets. As such, we are modifying our 2025 shipments guidance ranges for SPF, SYP and North American OSB as per the updated ranges shown on slide 7. Further to these guidance revisions, if and as the US administration's tariffs and other trade policies evolve, including the Section 232 investigation into US lumber imports, we will revisit the impact of any tariffs on our operations and consider whether any further revisions to our 2025 guidance forecasts are required.

就 2025 年的指導而言，由於住房負擔能力和維修及改造市場持續面臨的挑戰，我們的木材和北美 OSB 部門的需求水準將繼續低於預期。因此，我們將根據投影片 7 中顯示的更新範圍修改 SPF、SYP 和北美 OSB 的 2025 年出貨量指引範圍。除了這些指導修訂之外，如果美國政府的關稅和其他貿易政策發生變化，包括對美國木材進口的第 232 條調查，我們將重新審視任何關稅對我們運營的影響，並考慮是否需要對我們的 2025 年指導預測進行進一步修訂。

Regarding softwood lumber duties. On April 4, 2025, the US Department of Commerce released preliminary CVD rates for administrative review period 6 based on the year 2023. Our preliminary CBD for AR 6 is 16.57%, combined with our preliminary ADD rate for AR 6 of 9.48%, our preliminary combined rate for ARV is 26.5%, which is the lowest preliminary rate in the Canadian industry. Final rates are expected to be released in the coming days and weeks. If the AR 6 rates were to be confirmed, it will result in an expense of $65 million before the impact of interest for the period of review covered by AR 6, increasing the export duties payable recorded on our balance sheet.

關於軟木材木材關稅。2025年4月4日，美國商務部公佈了以2023年為基準的行政復議期6的初步反補貼稅率。我們對 AR 6 的初步 CBD 為 16.57%，加上我們對 AR 6 的初步 ADD 率為 9.48%，我們對 ARV 的初步綜合率為 26.5%，這是加拿大行業中最低的初步費率。最終利率預計將在未來幾天或幾週內公佈。如果確認 AR 6 稅率，則在 AR 6 涵蓋的審查期間，在計入利息影響之前，將產生 6500 萬美元的費用，從而增加我們資產負債表上記錄的應付出口關稅。

With that financial overview, I will pass the call back to Sean.

有了財務概況後，我會把電話轉回給肖恩。

Thank you, Chris. Looking forward, we continue to monitor shifting macroeconomic conditions that are being complicated by evolving trade policies. However, despite this backdrop, the company remains well positioned to navigate the dynamic business environment we face today. Our focus on controlling costs and optimizing our milk portfolio and production across different segments and geographies has been purposeful in an effort to create a more resilient company.

謝謝你，克里斯。展望未來，我們將繼續監測不斷變化的宏觀經濟狀況，這些狀況因貿易政策的演變而變得更加複雜。然而，儘管存在這樣的背景，該公司仍然能夠很好地應對我們今天面臨的動態商業環境。我們致力於控製成本並優化不同領域和地區的牛奶組合和生產，旨在打造更具彈性的公司。

You should expect us to continue to be flexible in our operating strategy which will allow us to meet the needs of our customers while keeping our focus on a safe working environment for our employees as well as operationalizing the benefits of our strategic capital to drive down costs. We will do all this while sticking to a balanced capital allocation strategy that includes investment in positive NPV projects while maintaining sufficient liquidity to support the pursuit of opportunistic growth and return of capital to shareholders.

您應該期望我們繼續保持靈活的營運策略，這將使我們能夠滿足客戶的需求，同時繼續關注員工的安全工作環境，並利用策略資本的優勢來降低成本。我們將在堅持平衡的資本配置策略的同時完成所有這些工作，該策略包括投資於正的 NPV 項目，同時保持足夠的流動性以支持追求機會性增長和向股東返還資本。

Shifting now to tariffs. As the Prime Minister has indicated publicly, the government of Canada is presently engaged with the United States in discussions about bilateral trade broadly. West Fraser and the Canadian industry continue to work closely with our federal and provincial governments and are prepared to support these discussions when called upon as they relate to softwood lumber. As we've said before, we continue to monitor the Canada-US trade situation closely and remain agile and ready to respond as needed.

現在轉向關稅。正如總理公開表示的那樣，加拿大政府目前正在與美國就雙邊貿易進行廣泛的討論。西弗雷澤和加拿大工業界繼續與我們的聯邦和省政府密切合作，並準備在涉及軟木材的討論中提供支援。正如我們之前所說，我們將繼續密切關注加拿大與美國的貿易局勢，並保持靈活，隨時準備做出必要的反應。

Specifically, we remain policy current so that we can be well prepared for whatever outcomes unfold. We continue to actively scenario plan in preparation for a broad range of trade-related and macroeconomic outcomes. We continue to prepare our business operations and operational plans to be quickly aligned to various scenarios, which includes our long maintained variable operating strategy to optimize how we meet our customers' needs.

具體來說，我們保持政策的更新，以便為任何結果做好充分準備。我們繼續積極制定情境規劃，為廣泛的貿易相關和宏觀經濟結果做好準備。我們將繼續準備我們的業務營運和營運計劃，以便快速適應各種情況，其中包括我們長期維持的可變營運策略，以優化我們滿足客戶需求的方式。

And finally, we continue to prepare and engage with our employees, our communities and our customers for what may lie ahead. While we are unable to provide any certainty to our stakeholders, we believe it is important to be as transparent as possible and to commit to regular communications should events warrant.

最後，我們將繼續為我們的員工、社區和客戶做好應對未來可能出現的情況的準備。雖然我們無法向利害關係人提供任何確定性，但我們認為盡可能保持透明並在事件需要時承諾定期溝通非常重要。

In closing, at West Fraser, we aim to deliver strong financial results through the business cycle. We achieved this by leveraging our product and geographic diversity, low-cost assets and the dedication of our people and culture rooted in cost discipline and a commitment to operate responsibly and sustainably. And we will be steadfast with this fundamental strategy even in a world with significant uncertainty. Although our near-term outlook remains somewhat cloudy given the broad implications of ongoing complexities in global trade, we are optimistic about the longer-term prospects for our industry and for West Fraser. And we look forward to continue to build one of the world's leading sustainable building products companies.

最後，在 West Fraser，我們的目標是在整個商業週期中實現強勁的財務表現。我們透過利用我們的產品和地理多樣性、低成本資產以及員工的奉獻精神和植根於成本紀律和負責任和永續營運承諾的文化來實現這一目標。即使世界充滿不確定性，我們也將堅定不移地堅持這項基本策略。儘管考慮到全球貿易持續複雜化的廣泛影響，我們的短期前景仍然有些不明朗，但我們對我們行業和西弗雷澤的長期前景持樂觀態度。我們期待繼續打造世界領先的永續建築產品公司之一。

Thank you. And with that, we'll turn the call back to the operator for questions.

謝謝。然後，我們會將電話轉回給接線生以回答問題。

(Operator Instructions) Ben Isaacson, Scotiabank.

（操作員指示）豐業銀行的 Ben Isaacson。

Just two quick ones for you, Sean, and then one for Chris. Sean, what -- have you seen a pivot in the trend? Or maybe I'll ask it a different way. What have you learned, if anything, about the substitutability between SPF and SYP over the past two or three quarters? Have you seen a shift in the price elasticity of demand?

肖恩，我只想快速地問你兩個問題，然後給克里斯問一個。肖恩，你看到趨勢的轉變了嗎？或者我可能會用不同的方式問。在過去兩三個季度中，您對 SPF 和 SYP 之間的可替代性有何了解？您是否看到需求價格彈性改變了？

Yes. I'll make a few comments, then I'm going to ask Matt to fill in what I miss. I think as we've seen over the last number of years that the spreads between the products, the price spreads move around quite a bit. In a period of higher demand, they tend to close as people search for the products they need. In periods of lower demand, like we've seen over the last year, those spreads have separated, and they really become more supply-demand driven within that species.

是的。我會發表一些評論，然後我會請馬特補充我遺漏的內容。我認為，正如我們在過去幾年中看到的那樣，產品之間的價差、價格差波動很大。在需求較高的時期，由於人們正在搜尋他們需要的產品，這些商店往往會關閉。在需求較低的時期，就像我們去年看到的那樣，這些價差已經分離，而且它們實際上變得更加受該物種的供需驅動。

So in the South, where you have more supply and less currently R&R demand were new homebuilding, which is more directed to SPF. And of course, lower supply in Western Canada, really hard to predict exactly what's happening there. But we think that's driving some of the spreads.

因此，在南方，供應量較大，目前 R&R 需求較少，新建住宅的趨勢更多地轉向 SPF。當然，加拿大西部的供應量較低，很難準確預測那裡會發生什麼。但我們認為這導致了部分利差的擴大。

And there is substitution when products are not available, but when they're available and customers have a preference and they're willing to pay that difference, then that spread persists. Matt, would you have anything to add to that?

當產品缺貨時，就會出現替代品，但當產品有貨，而顧客有偏好並且願意支付差價時，價差就會持續存在。馬特，你還有什麼要補充的嗎？

No. I think that's a good summary. And I'd say -- like I say, it's really up to customer preference as to which one of our products they're looking to apply to their end use.

不。我認為這是一個很好的總結。我想說的是——就像我說的，這完全取決於客戶的偏好，他們希望將我們的哪一款產品應用於他們的最終用途。

Great. And my second question for you, Sean, is the media has been talking a lot about a possible lumber export quota. What are your general views on this? And why was this found upon in the past?

偉大的。肖恩，我要問您的第二個問題是，媒體一直在談論可能的木材出口配額。您對此有何總體看法？為什麼過去會發現這種情況？

Yes. I'll make a few comments here, Ben. Again, I think as you can imagine, with the complexity of the current trade discussions on many product fronts and all product fronts between Canada and the US, there's a lot of balls in the air. And I think the the industry has really been standing ready to support the government when the opportunity presents itself for that dialogue. We and the government has been supportive and clear with us that softwood lumber will be part of those discussions.

是的。我要在這裡發表一些評論，本。再說一次，我想正如你所想像的，由於當前加拿大和美國之間在許多產品方面以及所有產品方面的貿易談判非常複雜，因此有很多事情需要解決。我認為，當對話機會出現時，業界確實已經準備好支持政府。我們和政府都給予了支持，並明確表示軟木材將成為這些討論的一部分。

So as a result, I think all options are on the table for those discussions and hard for us to speculate what that looks like, but we will be ready to support our government and the governments in those discussions as part of the broad industry coalition of what is best long term for the industry.

因此，我認為所有選項都擺在這些討論的桌面上，我們很難推測它會是什麼樣子，但作為廣泛的行業聯盟的一部分，我們將準備支持我們的政府和各國政府參與這些討論，以尋求對行業長期最有利的方案。

And I think just add specific to West Fraser, we have a long history of dealing with different border measures in lumber, long history of flexing our production and other products. And whatever that order measure is, we think we're well positioned with the assets we have, our cost position and finally, our integrated model, which allows us to optimize within that system. That's probably all I would make on that question, Ben.

我認為，具體到西弗雷澤，我們在處理木材的不同邊境措施方面有著悠久的歷史，我們在調整生產和其他產品方面有著悠久的歷史。無論訂單衡量標準是什麼，我們認為我們擁有的資產、成本狀況以及最終的整合模型都處於有利地位，這使我們能夠在該系統內進行最佳化。本，這可能就是我對這個問題的全部看法。

That's great. And then just one for Chris. Chris, I'm not sure how comfortable you are talking about this, but can you just give a sense of magnitude, are you cash flow positive right now in the North American lumber business at where pricing is right now? And then the same question for the North American OSB business.

那太棒了。然後只給克里斯一個。克里斯，我不確定你談論這個問題時是否感到自在，但你能否給出一個大致的印象，在目前的定價水平下，北美木材業務的現金流是否為正？對於北美 OSB 業務，我們也有同樣的問題。

Yes. I think we're going to steer clear of talking about any one particular segment or business relative to day-to-day pricing trends. I think if you look at how the business has performed through what's been a pretty tough lumber cycle going on two years, the diversity of our products being in not only OSB, but the other panel products, which have been important contributors, the portfolio optimization work that we've done, we think we've built a pretty strong business here that can weather what comes at us here and our countercyclical investing. We've been continuing to spend capital to lower costs. We've been flexing production. We were early in the process in terms of mill closures and removing high-cost production.

是的。我認為我們將避免談論與日常定價趨勢相關的任何特定領域或業務。我認為，如果你看一下我們的業務在過去兩年相當艱難的木材週期中的表現，我們的產品不僅包括定向刨花板，還包括其他面板產品，這些都是重要的貢獻者，我們所做的投資組合優化工作，我們認為我們已經建立了一個相當強大的業務，可以經受住我們面臨的挑戰和我們的反週期投資。我們一直持續投入資金來降低成本。我們一直在靈活生產。我們在關閉工廠和取消高成本生產方面處於早期階段。

So the way I would look at that is, look, we've been at this for a long time. It's in our DNA to deal with the cycles that we have and to drive cash flow even in difficult markets. Obviously, there can reach points where it's very difficult from a pricing standpoint. But those are -- we're doing everything we can to make sure those are transitory and short-lived. And I think our dedication to investing in the business and being durable with our capital allocation allows us pretty well to weather those short periods when those things can get dislocated.

所以我的看法是，看，我們已經這樣做很久了。應對我們所處的周期，甚至在困難的市場中推動現金流，這些都是我們的本能。顯然，從定價的角度來看，這可能會達到非常困難的程度。但這些都是——我們正在盡一切努力確保這些都是暫時的和短暫的。我認為，我們致力於投資業務並堅持持久的資本配置，這使我們能夠很好地度過那些可能出現混亂的短暫時期。

Ketan Mamtora, BMO Capital Markets.

Ketan Mamtora，BMO 資本市場。

Sean, just coming back to Ben's earlier question on quota, is it fair to say then that West Fraser is open to having a potential quota if that were to be the case? Is West Fraser open to that?

肖恩，回到本之前關於配額的問題，如果情況確實如此，那麼是否可以說西弗雷澤願意接受潛在的配額？西弗雷澤對此持開放態度嗎？

Ken, I think West Fraser, our position along with the entire Canadian industry is, as you can imagine, in this moment, with so many trade issues between Canada and the US and lumber consistently historically being off to the side and being separate, including lumber in a broader trade deal is our focus and our priority in supporting our -- supporting the Canadian government in those discussions. And I think to give the Canadian government the ability to be able to navigate through that I don't think there's been anything that the industry has taken off the table. And we are aligned with the industry in supporting the federal government in those negotiations and inclusion of lumber. We have to see what all those details look like in the end, but that is our -- where we're at today, Ketan.

肯，我認為西弗雷澤，我們以及整個加拿大工業的立場是，正如你所想像的，目前加拿大和美國之間存在如此多的貿易問題，而木材在歷史上一直被擱置一旁，被孤立，將木材納入更廣泛的貿易協議是我們的重點和優先事項，我們將在這些討論中支持加拿大政府。我認為為了讓加拿大政府有能力解決這個問題，我認為業界已經做了一切努力。我們與業界保持一致，支持聯邦政府參與這些談判並納入木材。我們必須看看最終所有這些細節是什麼樣子，但這就是我們今天所處的位置，Ketan。

Okay. No, that's helpful. And then just one more so far as trade is concerned. On Section 232 investigation, do you have any update, anything that you can share with us in terms of timelines? Or any other information you've got and whether OSP is also included in that investigation?

好的。不，這很有幫助。就貿易而言，我再說一點。關於第 232 項調查，您有任何最新進展嗎？可以與我們分享時間表方面的資訊嗎？或者您還有其他資訊嗎？ OSP 是否也包含在該調查中？

We really don't, Ketan. We don't have any additional insight into the timing, the nature of it, what that might look like. This is really something that is controlled completely by the US administration on their timing and as part of their overall thought process around trade between various countries.

我們確實不知道，Ketan。我們對其時機、性質以及可能會是什麼樣子沒有任何進一步的了解。這其實完全由美國政府控制時機，也是其圍繞各國之間貿易的整體思維過程的一部分。

And as you, I'm sure, well aware, there is a number of 232 investigations currently underway that affect a lot of products. So we don't have any other insight other than what you would have reading publicly on 232. And just to reinforce, we think whatever happens, whatever -- whether it's lumber or OSB, for a border measure, quality of our assets, our cost position and our integrated model, we think we're able to compete whatever that looks like.

我相信您也很清楚，目前正在進行的 232 項調查影響​​到許多產品。因此，除了您在 232 上公開閱讀的內容之外，我們沒有任何其他見解。需要強調的是，我們認為無論發生什麼，無論是木材還是定向刨花板，對於邊境措施、我們的資產品質、我們的成本地位和我們的綜合模式，我們都認為我們能夠參與競爭。

Got it. That's helpful. And then maybe, Chris, would you be able to share with us operating rates in the second quarter for lumber and OSB?

知道了。這很有幫助。那麼，克里斯，您能否與我們分享第二季度木材和定向刨花板的運作？

Yes. I wouldn't have those necessarily to the decimal point off the top of my head. But I would say we haven't really made substantive changes to our capacity, which is in the AIF. They're on an annual basis. I think what we published in February is the current state of our capacity.

是的。我不一定會把這些數字精確到小數點後幾位。但我想說的是，我們並沒有真正對我們的能力（即 AIF 的能力）做出實質的改變。它們是按年計算的。我認為我們在二月發布的內容就是我們目前的能力狀態。

And so that capacity is pretty ratable over the four quarters. There's no big seasonal changes there. So I think when you take a look at our production in Q2 relative to those annual capacity numbers there, that's your best guide as to what our utilization rate was in Q2.

因此，四個季度的產能是相當可觀的。那裡沒有大的季節變化。因此，我認為，當您查看我們第二季度的產量與那裡的年產能數字的關係時，這就是了解我們第二季度的利用率的最佳指南。

(multiple speakers) particularly in US in lumber. We're well below the capacity that we would prefer to -- well below the utilization that we would prefer to run at because we've been very diligent and thorough in terms of managing our schedules, controlling inventory, and meeting demand in the marketplace.

（多位發言者）尤其是美國的木材。我們的產能遠低於我們希望的水平——利用率遠低於我們希望的水平，因為我們在管理計劃、控制庫存和滿足市場需求方面非常勤奮和徹底。

Yes. That's helpful. Chris, just one last one from me and I'll turn it over. In the OSB business, what indicators -- you talked about having a flexible operating approach. What indicators that you all are looking at, whether it is demand, it is inventory, or anything else that you would point us to in terms of your approach to having that flexible operating schedule?

是的。這很有幫助。克里斯，我只剩下最後一個問題了，然後我就把它翻過來。在 OSB 業務中，有哪些指標—您談到了靈活的營運方式。你們都在關注哪些指標，無論是需求、庫存或其他什麼，在製定靈活的營運計畫方面，你能向我們指出什麼？

Yes. I mean, I think we're looking at all those factors. As you know, the biggest driver of OSB consumption is new housing construction. So we monitor the trends and developments in the new housing market pretty closely. We look at where that's trending in terms of starts and permits, both globally and across North America, but also regionally in line with where our productive capacity is and how that's shaking out.

是的。我的意思是，我認為我們正在考慮所有這些因素。眾所周知，OSB消費的最大動力是新房屋建設。因此，我們密切關注新房市場的趨勢和發展。我們關注全球和北美開工和許可方面的趨勢，同時也關注區域生產能力的分佈和發展。

Our inventory levels in -- that we can hold in OSB are pretty limited because it has to be stored inside. So we don't really build a lot of inventory and then draw it down. So we have to react pretty quick, and we tend to do that. And we look at all those macro factors, principally around interest rate or housing and housing construction as indicators of how we need to be thinking about the ability to flex over the near term and medium term.

我們的 OSB 庫存水準非常有限，因為它必須存放在裡面。所以我們實際上不會建立大量庫存，然後再將其減少。所以我們必須迅速做出反應，而且我們傾向於這樣做。我們將所有這些宏觀因素，主要是利率或住房和住房建設作為我們如何考慮短期和中期靈活變通能力的指標。

Hamir Patel, CIBC Capital Markets.

加拿大帝國商業銀行資本市場 (CIBC Capital Markets) 的 Hamir Patel。

Sean, the European business has been hovering around breakeven for the past two years. What do you need to do to fixed that operation? And at what point would you consider putting that business up for sale and focusing on what you do best in North America?

肖恩，過去兩年歐洲業務一直徘徊在損益兩平點。您需要做什麼來修復該操作？什麼時候您會考慮出售該業務並專注於您在北美最擅長的領域？

Yes. Hamir, I would say Europe is largely the same challenges as North America from a macro perspective. End-use demand has been has been difficult for some time. Saying that, our assets are are well positioned. They operate well.

是的。哈米爾，我想說，從宏觀角度來看，歐洲面臨的挑戰與北美大致相同。一段時間以來，終端需求一直很困難。話雖如此，我們的資產定位良好。它們運作良好。

We have an excellent team over there. We've got good, strong relationships with our customers. We think we're really well positioned as Europe comes back. Again, that is that is really, I guess, the unknown part. Saying that, sequentially, we've seen some improvement in our OSB business over there, still modest but moving in the right direction.

我們在那裡有一支優秀的團隊。我們與客戶保持著良好、牢固的關係。我們認為，隨著歐洲的復甦，我們已做好充分準備。再說一次，我猜這確實是未知的部分。話雖如此，我們看到那裡的 OSB 業務有所改善，雖然幅度不大，但正朝著正確的方向發展。

In terms of your other question, I think we're very pleased to have Europe as part of West Fraser. Again, we have to wait and see on the macro for Europe, but good assets, good people, well positioned in the cost structure, things will get better in Europe. And when they do, we're going to be in a good spot to participate in that. So that's all I would say about Europe.

關於您的另一個問題，我認為我們很高興歐洲成為西弗雷澤的一部分。再次強調，我們必須對歐洲的宏觀情勢保持觀望，但良好的資產、優秀的人才、良好的成本結構，歐洲的情況將會好轉。當他們這樣做時，我們將處於有利位置來參與其中。這就是我想說的有關歐洲的全部內容。

Okay. Fair enough. I just want to follow up on a potential quota framework for lumber. If we ever do end up with that as a solution, how would West Fraser like to see quotas allocated between the provinces? And then how would you like to see the provinces allocate quota to the companies?

好的。很公平。我只是想跟進木材的潛在配額框架。如果我們最終找到解決方案，西弗雷澤希望各省之間如何分配配額？那麼您希望各省如何分配配額給企業？

That's a very detailed question there, Hamir. I'm really not going to comment on what any of those details are. What I would -- could be or speculate on what that may or may not be. What I would say is that the federal government, the Canadian industry good alignment on being inclusion of lumber, inclusion of wood products, open to discussion around what the framework and dialogue would be. I think the most important part in the immediate term is inclusion of wood products, inclusion of lumber and supporting -- the industry staying aligned and supporting our government and having open dialogue on what's best long term. All those other details are hypothetical and really, we're just not in a position to comment on any of that.

這是一個非常詳細的問題，哈米爾。我真的不想評論任何細節。我會——可能是什麼，或推測那可能是什麼或可能不是什麼。我想說的是，聯邦政府和加拿大工業界在木材和木製品的納入方面達成了良好的共識，並願意就框架和對話內容進行討論。我認為短期內最重要的部分是納入木製品、木材和支援——產業保持一致並支持我們的政府，並就長期最佳方案進行公開對話。所有其他細節都是假設的，實際上，我們無法對任何細節發表評論。

Matthew McKellar, RBC Capital Markets.

加拿大皇家銀行資本市場 (RBC Capital Markets) 的馬修麥凱勒 (Matthew McKellar)。

First for me, just like to ask, do you get the sense that we're seeing any pre-buying or inventory accumulation of SPF in the US ahead of those higher duty rates taking effect? And if not, I guess, when do you really expect that to start?

首先，我想問一下，在更高的關稅生效之前，您是否感覺到美國出現了 SPF 的預購或庫存累積？如果沒有的話，我想，您真正希望什麼時候開始呢？

Matthew. I might turn this one over to Matt, just to talk a little bit about current buying patterns.

馬修。我可能會把這個問題交給馬特，只是稍微談談目前的購買模式。

I would say we haven't seen a noticeable change in customer purchasing patterns to date. And generally, I think in uncertain economic outlooks we generally don't see an increase in purchasing patterns.

我想說，到目前為止，我們還沒有看到客戶購買模式有明顯變化。總體而言，我認為在經濟前景不確定的情況下，我們通常不會看到購買模式的增加。

Okay. And I mean, do we need to see the final results there for that accumulation start to occur? Or in your mind, are you likely to see some buying in the market just ramp up here over the next couple of weeks? How are you thinking about how that plays out?

好的。我的意思是，我們是否需要看到最終結果才能開始出現這種累積？或者在您看來，未來幾週內，您是否有可能看到市場上的購買量增加？您認為結果會怎樣？

I think hard to speculate how our customers will react to the new duties. But I would say they're really focused on have enough inventory to meet their demand and how to navigate the uncertainty ahead of them.

我很難猜測我們的客戶將如何應對新的關稅。但我想說，他們真正關注的是擁有足夠的庫存來滿足他們的需求，以及如何應對未來的不確定性。

(Operator Instructions) Sean Steuart, TD Cowen.

（操作員指示）Sean Steuart，TD Cowen。

A couple of questions, Sean. I'll ask one more on the lumber trade stuff. I guess I'm just curious on this comes to a head seemingly in the short term and a lot of changes get made to potential terms in a short period of time. How is the federal government or the provinces corresponding directly with industry to get input along the way? Are you guys being consulted constantly to provide input on potential structure? Just more curious on the logistics of how the government involves the industry in this.

有幾個問題，肖恩。我將再問一個有關木材貿易的問題。我想我只是好奇這個問題似乎在短期內就達到了頂峰，並且在短時間內對潛在條款進行了很多更改。聯邦政府或各省如何直接與工業界溝通以獲取投入？你們是否經常被諮詢以提供有關潛在結構的意見？我只是更好奇政府如何讓產業參與其中的後勤工作。

Yes. Sean, I think, frankly, for the past year like a lengthy period of time. The industry has been collaborating. There's been a lot of discussion along the way with both federal and provincial governments. So awareness of the current situation, alignment with the industry and that open dialogue, all of that prework has been done. And our relationships, the industry's relationships are open. They're collaborative. And the lines of communication are in place when the moment comes when if the moment comes for that discussion.

是的。肖恩，坦白說，我認為過去的一年是一段漫長的時期。該行業一直在進行合作。在這個過程中，聯邦政府和省政府都進行了大量討論。因此，對當前情況的認識、與行業的協調以及開放的對話，所有這些準備工作都已完成。我們的關係、產業關係都是開放的。他們彼此合作。當需要討論時，溝通管道就已經到位了。

Okay. And then a question for Chris. Optimization, ongoing optimization of the wood product portfolio in North America. This year will still be a busy CapEx year for you guys, but maybe less than we've seen the last few with Henderson wrapping up. Can you give a perspective on the pipeline of discretionary CapEx projects you guys have in the hopper and any constraints on contractor labor equipment availability. I'm just trying to get a sense of how things could trend into 2026 and beyond?

好的。然後問克里斯一個問題。優化，持續優化北美的木材產品組合。對你們來說，今年仍將是繁忙的資本支出年，但可能比過去幾年亨德森結束的資本支出少。您能否介紹一下您正在進行的可自由支配的資本支出項目以及承包商勞動力設備可用性方面的任何限制。我只是想知道事情在 2026 年及以後會如何發展？

Yes. Thanks, Sean. I think as we've noted, we've had a lot of major projects underway here. And one of the things we've been proud of is our ability to position ourselves to invest countercyclically. To take the downtime to do these capital projects in a weak market is the best time to do them from our perspective and to make investments when possibly others aren't is a little -- is beneficial from the standpoint of being able to get access to contractors and equipment.

是的。謝謝，肖恩。我認為正如我們所注意到的，我們這裡已經有很多重大項目正在進行中。我們引以為傲的事情之一是我們能夠進行逆週期投資。從我們的角度來看，在疲軟的市場中利用停工期進行這些資本項目是最佳時機，而在其他人可能不會投資的時候進行投資，從能夠獲得承包商和設備的角度來看，是有好處的。

I think anecdotally, we understand that contractor backlogs are shrinking, probably not unsurprising in the lumber environment that we've been in, that there's just fewer projects going on, and there's a little bit better availability there on some front. But what I would say is -- I would say is this, right?

我認為，從傳聞來看，我們了解到承包商積壓的訂單正在減少，這在我們所處的木材環境中可能並不奇怪，正在進行的項目越來越少，而且在某些方面可用性也更好一些。但我想說的是——我想說這是對的嗎？

Like as Sean mentioned, there's a ton of uncertainty out there right now. We have, I think, probably a lot of great projects in the pipeline that we could do over the next several years. Our focus in the near term is going to be on ramping up the stuff that we have underway, operationalizing that, getting the benefits of that, continuing to work the cost position down through operationalizing those projects.

正如肖恩提到的那樣，現在存在大量不確定性。我認為，我們可能有很多很棒的項目正在籌備中，可以在未來幾年內完成。我們近期的重點是加快正在進行的工作，使其投入運營，從中獲益，並透過實施這些項目繼續降低成本。

And then probably, in all likelihood, seeking a little bit of greater clarity about the macro conditions and the trade environment before making major decisions on the next -- whatever those next round of projects would be for us. So I think that's how I'd frame it up. Sean, I don't know if you want to add anything to that?

然後，很有可能，在對下一輪專案做出重大決定之前，我們會對宏觀條件和貿易環境有更清晰的了解——無論下一輪專案對我們來說是什麼。所以我認為這就是我的想法。肖恩，我不知道你是否想補充一點？

No, I think that was perfect, Chris.

不，我認為那很完美，克里斯。

Maybe just one follow-on. As we're in this extended trough for wood product markets. Whether you guys are interested right now or not, can you speak to what the M&A opportunity set looks like for bolt-ons have more potential sellers come into the market as this trough is extended here?

也許只是一個後續行動。由於我們正處於木製品市場的長期低谷期。無論你們現在是否感興趣，您能否談談隨著低谷的延長，更多潛在賣家進入市場，附加產品的併購機會是什麼樣的？

No, why don't you take that one, Chris?

不，你為什麼不拿那個呢，克里斯？

Yes, Sean, I think our track record, in particular, over the last several years has been that we're ready and able to be an acquirer of quality assets should those quality assets come available. And we've made fairly selective additions to the portfolio that, in our view, have made the portfolio better. I think a tremendous amount of uncertainty out there right now in the marketplace. If that creates distress, does that create opportunities, that's a lot of speculation as to what that's going to mean.

是的，肖恩，我認為，特別是過去幾年的業績記錄表明，如果優質資產可用，我們已經準備好並且能夠成為優質資產的收購者。我們對投資組合進行了相當有選擇性的補充，我們認為這使得投資組合變得更好。我認為目前市場上存在大量不確定性。如果這會帶來困擾，那麼這是否會帶來機遇，至於這意味著什麼，有很多猜測。

But what I would say is we've got the financial capacity to grow. I think we've got the ability to execute when those things happen. We've got a strong track record of integrating acquisitions, both large and small. We have the balance sheet to do things that make sense, but it's all going to be through a lens of quality of things where there's -- it makes us better very quickly or there's a very clear path to strong synergies and improvement of the franchise on an overall basis. We're not looking to buy assets just because they're available.

但我想說的是，我們擁有發展的財務能力。我認為當這些事情發生時我們有能力執行。我們在整合大型和小型收購方面有著良好的業績記錄。我們有資產負債表來做有意義的事情，但這一切都要透過事物的品質來衡量——它可以讓我們很快變得更好，或者有一條非常清晰的道路可以實現強大的協同效應並從整體上改善特許經營。我們不會因為有資產就購買它們。

There are no further questions at this time. Please proceed.

目前沒有其他問題。請繼續。

Thank you, Jenny. As always, Chris and I are available to respond to further questions, as is Robert Winslow, our Director of Investor Relations and Corporate Development. Thank you for your participation today. Stay well, and we look forward to reporting on our progress next quarter.

謝謝你，珍妮。像往常一樣，克里斯和我以及我們的投資者關係和企業發展總監羅伯特溫斯洛都可以回答進一步的問題。感謝您今天的參與。保持健康，我們期待下個季度報告我們的進展。

Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect your lines.

女士們、先生們，會議現已結束。感謝大家的加入。你們都可以斷開自己的線路。