- Stella Jones (TSX:SJ) has announced its first quarter results, with the North American timber supplier reporting a sales boost
- Sales in the quarter generated C$503 million, a 14 per cent increase when compared to 2019’s corresponding period
- The company’s gross profit for the quarter was up 19 per cent, totalling C$83 million
- EBITDA remained stable at $63 million, due to losses on diesel derivative financial instruments
- Stella Jones (SJ) is up 0.4 per cent to $34.26 per share, with a market cap of $2.3 billion
Stella Jones (TSX:SJ) has announced its first quarter results, with the North American timber supplier reporting a sales boost.
Sales tipped up 14 per cent throughout the quarter for a record C$503 million. First quarter sales in 2019 were $441 million.
In particular, sales of utility poles were up 18 per cent for the quarter. This netted the company some $202 million.
The company generated a gross profit of $83 million, up from $70 million in last year’s first quarter.
EBITDA remained stable at $63 million, negatively impacted by a $7 million mark-to-market loss on diesel derivative financial instruments.
Sales in the company’s residential lumber stream were up 25 per cent on last year and accounted for 14 per cent of the company’s total sales for the quarter. This netted the company some $71 million, up from $57 million last year.
Stella-Jones is considered an essential service, and an essential part of the supply chains for North American utilities, railroads and the construction industry. Consequently, the company has not been impacted by provincial lockdown measures.
However, due to the COVID-19 pandemic, the company has implemented a suite of hygiene measures, along with the standard physical distancing policies all Canadian businesses are following.
The company’s CEO and President, Eric Vachon said the company had a solid start to the year with the sales boost.
“Sales growth for our pressure-treated wood products was supported nay stronger demand for utility poles and residential lumber, and improved pricing for utility poles and railway ties.
“While higher sales led to a 19 per cent increase in gross profit, EBITDA was unfavourably impacted by the mark-to-market variation in diesel derivative commodity contracts.
“As a result, EBITDA remained stable compared to the same period last year,” he said.
Stella Jones (SJ) is up 0.4 per cent to $34.26 per share at 3:39 pm EDT.