VANCOUVER - West Fraser Timber Co (NYSE:WFG). Ltd. (TSX:WFG, NYSE:WFG) has finalized the sale of its Quesnel River Pulp mill and Slave Lake Pulp mill to an affiliate of a fund managed by Atlas (NYSE:ATCO) Holdings. The transaction followed standard regulatory reviews and closing conditions. These mills will now be under the operation of Millar Western Forest Products, a member of the Atlas group since 2017.
Sean McLaren, President & CEO of West Fraser, expressed gratitude to the employees of both mills for their service and highlighted that the sale aligns with the company's strategy to concentrate on its core building products business in North America.
Both Quesnel River Pulp and Slave Lake Pulp specialize in the production of Bleached Chemi-Thermomechanical pulp (BCTMP), a material commonly used for paper products.
West Fraser is a diversified wood products company with operations across Canada, the United States, the United Kingdom, and Europe. The company is engaged in the production of a wide range of wood products including lumber, engineered wood, pulp, newsprint, and renewable energy, all sourced from sustainably managed forests.
This news is based on a press release statement from West Fraser Timber Co. Ltd.
InvestingPro Insights
As West Fraser Timber Co. Ltd. (WFG) restructures its operations through the sale of its pulp mills, the company's financial health and market position are critical for investors to consider. According to InvestingPro data, West Fraser's market capitalization stands at 6330 million USD, reflecting the company's substantial presence in the wood products industry.
The company's recent financial metrics demonstrate a challenging period, with a significant P/E ratio of -38.28, which adjusts to 180.45 when considering the last twelve months as of Q4 2023. This high adjusted P/E ratio indicates that investors may have high growth expectations from the company in the future, which aligns with West Fraser's strategic focus on its core building products business. Additionally, the company's revenue growth has seen a decline of -33.47% over the last twelve months as of Q4 2023, emphasizing the potential impact of the divestitures and market conditions.
InvestingPro Tips suggest that investors should keep an eye on the company's PEG ratio, which stands at 0.35, indicating that the stock could be potentially undervalued considering its growth expectations. Furthermore, with the next earnings date approaching on April 23, 2024, investors will be keen to assess how the recent strategic changes influence the company's financial performance.
For those looking to delve deeper into the metrics and gain further insights, InvestingPro offers additional tips that can help investors make more informed decisions. There are currently more tips available on InvestingPro. To access these insights and benefit from the full range of features, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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