Acadian Timber Q2 Earnings Call Highlights

Q2 results weakened: Revenue fell to $14.6 million from $17.1 million, while adjusted EBITDA dropped to $1.3 million from $2.4 million and net income declined to $1.3 million, or $0.07 per share. Lower volumes, seasonal conditions and elevated customer inventories outweighed a 19% increase in weighted average selling prices.

Maine operations improved: Operational changes focused on reducing cost per cubic meter helped lift Maine adjusted EBITDA to a loss of $0.4 million from a $0.9 million loss, although the segment remained unprofitable. Management expects further improvement through the rest of 2026.

Outlook is cautiously positive: New Brunswick inventories have normalized, supporting a recovery in sales volumes, but pulpwood demand and pricing remain soft. Acadian ended the quarter with $15 million of net liquidity and plans to refinance $45 million of debt maturing in March 2027, while renewable-energy, carbon-credit and Maine real-estate projects offer longer-term upside.

Acadian Timber reported lower revenue, adjusted EBITDA and net income for the second quarter of 2026, as seasonal operating conditions and elevated customer inventories reduced sales volumes. Management said operational improvements in Maine began to benefit costs during the quarter, while it expects New Brunswick sales volumes to recover as customer inventories normalize. The company generated $14.6 million in revenue for the quarter ended June 27, down from $17.1 million a year earlier. Adjusted EBITDA totaled $1.3 million, compared with $2.4 million in the second quarter of 2025, while net income was $1.3 million, or $0.07 per share, versus $2.7 million, or $0.15 per share, a year earlier.

Susan Wood, Acadian Timber’s chief financial officer, said the second quarter is typically the company’s lowest production period because of seasonal conditions. This year, volumes were further affected by high customer inventories following a productive winter, particularly in New Brunswick. Higher Prices Partly Offset Volume Declines Revenue declined primarily because of lower volumes, though the impact was partly offset by a 19% increase in the company’s weighted average selling price. Wood said stronger softwood lumber markets, higher fuel surcharges and longer hauling distances contributed to the higher average selling price. Operating costs and expenses declined by $1.7 million from the prior-year period. The decrease reflected lower sales volumes, operating efficiencies that began taking effect in Maine during the quarter, and lower selling and administrative costs. Those benefits were partly offset by higher fuel adjustment costs and longer hauling distances. Net income also reflected lower operating income, higher interest expense and higher income tax expense compared with the same quarter last year, Wood said. Higher non-cash fair-value adjustments partially offset those factors. New Brunswick freehold sales volumes fell 38% year over year. New Brunswick sales totaled $12 million, down from $14.4 million, while adjusted EBITDA declined to $2.1 million from $4 million. Maine freehold sales volumes decreased 31% as the company reduced internal harvesting activity. Maine sales were $2.6 million, compared with $2.7 million a year earlier, while adjusted EBITDA improved to a loss of $400,000 from a loss of $900,000. In New Brunswick, the weighted average selling price excluding biomass increased 19%. Variable costs were also affected by higher fuel costs and longer hauling distances. In Maine, the weighted average selling price rose 16%, supported by a higher-value product mix, fuel surcharges and longer hauls. Cost of sales per cubic meter p...