McElvaine Value Fund on Canfor Corporation

Canfor is one of the world's largest lumber producers, with operations across British Columbia, Alberta, the US South and Sweden as well as a pulp business. The company is controlled by Jimmy Pattison, who owns just over half of the shares. Operating conditions remain difficult, but the company's loss narrowed in Q2 as the lumber division returned to modest profitability. Management has been restructuring aggressively by permanently closing uneconomic facilities in Alberta, Sweden and British Columbia while acquiring the minority interest in its pulp subsidiary and purchasing an engineered wood business. The company has net cash when excluding its duty deposit loan, giving it greater resilience during the weak lumber environment. McElvaine considers the situation mixed because restructuring is improving the asset base but tariff uncertainty remains.