TSE:ADN Acadian Timber Q3 2023 Earnings Report C$17.20 +0.05 (+0.29%) As of 04/28/2025 03:56 PM Eastern Earnings HistoryForecast Acadian Timber EPS ResultsActual EPSC$0.21Consensus EPS C$0.17Beat/MissBeat by +C$0.04One Year Ago EPSN/AAcadian Timber Revenue ResultsActual Revenue$26.59 millionExpected RevenueN/ABeat/MissN/AYoY Revenue GrowthN/AAcadian Timber Announcement DetailsQuarterQ3 2023Date11/1/2023TimeN/AConference Call DateThursday, November 2, 2023Conference Call Time1:00PM ETConference Call ResourcesConference Call AudioConference Call TranscriptInterim ReportEarnings HistoryCompany ProfilePowered by Acadian Timber Q3 2023 Earnings Call TranscriptProvided by QuartrNovember 2, 2023 ShareLink copied to clipboard.There are 4 speakers on the call. Operator00:00:00Good day and thank you for standing by. Welcome to the Acadian Timber Corp. Q3 2023 Analyst Conference Call and Webcast. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Operator00:00:26Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Susan Wood, Chief Financial Officer. Please go ahead. Speaker 100:00:36Thank you, operator. Good afternoon, everyone, and welcome to Acadian Timber's 3rd quarter conference call. With me on the call today is Adam Chaparski, Acadian's President and Chief Executive Officer. Before discussing Acadian's results, I'll first remind everyone that in discussing our Q3 financial and operating performance, the outlook for the remainder of 2023 and into 2024 and responding to your questions, we may make forward looking statements. These statements are subject to known and unknown risks and future results may differ materially. Speaker 100:01:11For further information on our known risk factors, I encourage you to review our news release and MD and A, which are available on SEDAR and on our website atacadiantimber.com. I'll begin by outlining the financial and operational highlights for our Q3 ended September 30, 2023. Adam will then provide some additional comments and discuss our outlook for the remainder of the year. Acadian generated solid financial results for the quarter ended September 30, benefiting from continued stable regional demand and pricing for its products. Sales for the Q3 were $26,600,000 compared to $23,600,000 in the same quarter of 2022. Speaker 100:01:56Sales volume excluding biomass increased 13% compared to the prior year period. Weighted average selling price excluding biomass increased 1% year over year benefiting from strong softwood sawlog and pulpwood prices driven by solid demand, partially offset by decreased hardwood sawlog prices stemming from weakness in hardwood lumber pricing. Pricing for softwood sawlogs increased 5% compared to the prior year period, driven by stable demand, while hardwood sawlog pricing decreased 12% due to declines in end use markets. Demand was strong for softwood pulpwood, resulting in a pricing increase of 19% year over year. Hardwood pulpwood pricing increased 2% over the same period of 2022. Speaker 100:02:45Biomass prices were 25% lower due to unfavorable product and customer mixes. Operating costs and expenses were $21,900,000 during the Q3 compared to $19,200,000 during the prior year period, reflecting higher sales volumes. Weighted average variable costs, excluding biomass, were consistent with the prior year period, with increased contractor rates being offset by lower fuel prices. Adjusted EBITDA was $4,900,000 during the Q3 compared to $4,500,000 in the prior year period, reflecting higher operating income and gain on sale of Timberlands. Adjusted EBITDA margin for the quarter was 18% compared to 19% in the prior year period. Speaker 100:03:35Net income for the Q3 totaled $6,400,000 or $0.37 per share compared to $4,800,000 or $0.29 per share in the same period of 2022. The increase in net income compared to the prior year period was primarily the result of higher operating income and non cash fair value adjustments as well as lower income tax expense. Acadian generated $4,300,000 of free cash flow and declared dividends of $5,000,000 to our shareholders during the 3rd quarter or $0.29 per share. I'll now move into the 3rd quarter results for our New Brunswick operations. Sales for New Brunswick in the Q3 were $22,800,000 compared to $19,900,000 during the prior year period. Speaker 100:04:22Sales volume excluding biomass increased by 15%, primarily due to increased contractor availability. With regards to softwood sawlogs and pulpwood, demand was strong with volumes 19% higher for sawlogs and 35% higher for pulpwood than the prior year period. New Brunswick pricing for softwood sawlogs and softwood pulpwood increased 8% 26%, respectively, compared to the prior year period. Hardwood sawlog volumes in New Brunswick decreased 28%, while hardwood pulpwood volumes increased 9% compared to the prior year period as a result of a change in harvest mix. Prices for hardwood sawlogs were 9% lower than the prior year period due to weekend end use markets, while prices for hardwood pulpwood were 3% higher than the prior year period due to strong demand. Speaker 100:05:19Operating costs and expenses were $17,500,000 during the Q3 compared to $15,400,000 in the prior year period, reflecting higher sales volumes. Weighted average variable costs, excluding biomass, were consistent with the prior year period, with increased contractor rates being offset by lower fuel prices. New Brunswick's adjusted EBITDA for the quarter was $5,500,000 compared to $4,600,000 in the prior year period and adjusted EBITDA margin was 24% compared to 23% in the prior year period, primarily as a result of higher operating income. Switching over to Maine. Sales remained during the Q3 totaled $3,800,000 compared to $3,700,000 in the prior year period. Speaker 100:06:09Sales volume excluding biomass increased 6%, reflecting increased contractor availability, partially offset by unfavorable weather conditions as compared to the same period in the prior year. Softwood sawlog volumes in Maine increased 5% as compared to the prior year period due to increased contractor capacity. In U. S. Dollar terms, pricing for softwood sawlogs decreased only slightly by 4% compared to Q3 2022, reflecting stable demand for fewer export sales. Speaker 100:06:40Softwood pulpwood volumes were negligible during the quarter due to the shutdown of a key customer. Hardwood sawlog volumes were also negligible during the quarter, but are typically modest in Maine. Hardwood pulpwood volumes increased 67% due to changes in harvest mix, although pricing decreased 9% in U. S. Dollar terms due to market conditions. Speaker 100:07:04Operating costs and expenses for the Q3 were $3,900,000 compared to $3,500,000 during the same period in 2022, reflecting higher harvesting activity. Weighted average variable costs, excluding biomass, were consistent with the prior year period, again with higher contractor rates offset by lower fuel prices. Adjusted EBITDA for the quarter was negative Adjusted EBITDA margin was negative 4% compared to 6% in the prior year period. With respect to Acadian's financial position at the end of the quarter, it remains strong, ending with a net liquidity position of $15,900,000 including funds available under our revolving credit facilities. With that, I'll now turn the call over to Adam. Speaker 200:08:08Thank you, Susan, and good afternoon, everyone. As always, Acadian remains committed to health and safety as our number one priority. During the Q3, there were no recordable safety incidents among our employees or our contractors. We are very proud of all the hard work and dedication towards safety that is shown on a daily basis across the entire organization. As Susan mentioned, we experienced a solid third quarter. Speaker 200:08:34While excessive rainfall impacted operations in Maine, operating conditions were favorable in New Brunswick. Ongoing efforts from the operations team resulted in increased contractor capacity and allowed us to continue to catch up on the volume shortfalls experienced earlier in the year. We now believe that this hard work has put us in a position to achieve similar total volumes experienced in fiscal 2022. As you know, the weather can play a significant role in our operations, but Mother Nature seems to be cooperating so far in the Q4. The current dynamics of the Northeast Forestry Sector resulted in stable pricing and demand during the Q3. Speaker 200:09:15There remains some tension in the supply chain, which supports the stability of our weighted average sales pricing and allows for the recovery of the increased inflationary costs that we have experienced. Although we do not usually spend much time talking about our land sales, We have accumulated more than what has been experienced in recent years. The total proceeds of $670,000 recorded in the 1st 2 quarters of 2023 on the sale of approximately 20 acres of land. We will continue to evaluate the land base in both New Brunswick and Maine. Now that we do not expect it to become a significant generator of cash flows for the business in the short term, we do believe that we will be able to continue to unlock potential in the future. Speaker 200:10:00A few comments on our carbon credit project. As we noted last quarter, the first 770,000 carbon credits associated with projects were registered in the American Carbon Registry on June 8 under the name Anew Etodden Forestry Project. The team is currently working on the 2nd reporting period, which is expected to produce approximately 215,000 credits, with the 3rd reporting period credits expected to be developed later in fiscal 2024, resulting in approximately 215,000 additional credits. We are in regular contact with our 3rd party developer and understand that volumes of carbon credit sales have slowed somewhat over the last couple of quarters as as a result of a number of factors. However, pricing for voluntary improved forest management credits appears to be stable, which we expect to bode well for a project like Acadian's. Speaker 200:10:53And as buyers gravitate toward quality, we remain optimistic with regards to the monetization of the first 770,000 credits. Turning to our outlook for the remainder of 2023 and into 2024, North American interest rates remain elevated and near term pressure on the end use market persists. However, inflationary pressures have begun to show signs of easing and the consensus forecast for U. S. Housing starts has risen to approximately 1,400,000 starts in 2023. Speaker 200:11:25We remain confident that the stability of the Northeastern Forestry Sector combined with the long term demand for new homes and recurring remodel activity will continue to support the demand for our products. The labor markets remain tight. As I noted, we continued to Increased contractor availability during the Q3. Some challenges remain and management will continue to focus on further increasing our harvesting capacity through the remainder of the year and into 2024. In the short to medium term, inflation is expected to continue to impact our financial results through elevated contractor rates and fuel surcharges. Speaker 200:12:02Demand for Acadian sawlogs is mainly driven by regional supply and demand, meaning that the stable demand experienced during the 1st three quarters is expected to continue the balance of 2023. Pricing for softwood sawtimber is expected to remain consistent for the remainder of the year. And although we have seen weaknesses in hardwood sawtimber pricing throughout the summer, they appear to have stabilized as we exited the quarter. Demand for hardwood pulpwood is expected to remain steady and softwood pulpwood markets are expected to remain at the improved levels experienced to date in 2023. In summary, as we finish the year, We expect continued solid financial and operating performance. Speaker 200:12:46Progress made increasing contractor availability will benefit Acadian for the rest of 2023 and into the winter harvest season of 2024 and will remain a key focus. Acadian continues to benefit from a strong balance sheet, continued diversification of our markets and a highly capable team focused on strong financial and operating performance. As always, we will remain focused on merchandising our products to obtain the highest margins available and making improvements throughout the business to maximize cash flows from our existing timberland assets. We continue to explore opportunities to grow as demonstrated by our advancement into the carbon credit market, Opportunistic land sales as evidenced year to date and exploring additional land use opportunities, such as renewable energy and additional land leasing. With that, we are now available to take your questions. Speaker 200:13:38Operator? Operator00:13:56Our first question will come from Arianna Mellon of CIBC Capital Markets. Your line is open. Speaker 300:14:04Hello. I hope all is well. My first question relates to contractor availability. In the MD and A, you mentioned that you'll Continue to focus on increasing harvesting capacity in Q4 and into 2024. Do you see regional Speaker 200:14:29Good question. We've been working really hard at it. I think that as we move Through the remainder of the fall of 2023 and into 2024, I think there's still some availability there for us. Through a lot of hard work by the team here, we've really been able to increase our understanding of the rates and what Stresses our contractors, so we've been successful in increasing our capacity. Appreciate we're taking some of that from other people. Speaker 200:15:01So there will be some As far as the limit, I believe there probably is. At some point, there's going to be a limit. But I do feel strongly that we're going to be able to achieve what we need to achieve from a contractor capacity to be allowed to allow us to cut Our full harvest moving forward. So as a large landowner, the stability that affords us and it would afford a contractor makes it More attractive and now that we have a handle on our contractors, I'm feeling very confident as we move forward. Speaker 300:15:38Okay. Thanks. That's helpful. And then with regard to hardwood lumber prices, you mentioned that you've seen prices Do you expect this to continue? Or do you still view further price increases as a risk in the near term? Speaker 200:15:53Yes. And so there's hardwood lumber prices, which obviously end use, not our business, but it had an impact on our customers. That's a tough one. We understand they're stabilizing. I don't think I'm not sure it can go much lower to be honest Based on what we're hearing from our customers, fortunately for our business, the sawtimber business, We have a supply that is limited. Speaker 200:16:27And so when I say supply, regional That is limited, which has allowed us to keep our pricing pretty stable in relationship to the prices of lumber and hardwood lumber in particular. So We're feeling pretty confident that our prices have stabilized inside of Acadian moving forward. And now the business will be to Make sure that we start increasing that as the price of lumber starts to increase in the future. Speaker 300:16:55Okay, great. Thanks. That's all I have for now. So I'll get back in the queue. Speaker 200:16:59Great. Thanks, Arianna. Operator00:17:27And I would now like to turn the conference back to Adam for closing remarks. Speaker 200:17:32Thank you, operator. On behalf of the Board and management of Acadian, I would like to thank all of our shareholders for their ongoing support. Thank you. Stay safe and we look forward to you joining us for our Q4 conference call on February 8. Goodbye. Operator00:17:49And this concludes today's conference call. Thank you for participating. You may now disconnect.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallAcadian Timber Q3 202300:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsInterim report Acadian Timber Earnings HeadlinesRoyal Bank of Canada Has Lowered Expectations for Acadian Timber (TSE:ADN) Stock PriceApril 24, 2025 | americanbankingnews.comAcadian Timber Corp (ACAZF) Q4 2024 Earnings Call Highlights: Navigating Challenges with ...February 14, 2025 | gurufocus.comNow I look stupid. Real stupid... I thought what happened 25 years ago was a once- in-a-lifetime event… but how wrong I was. Because here we are, a quarter of a century later, almost to the exact day, and it’s happening again. April 29, 2025 | Porter & Company (Ad)Q4 2024 Acadian Timber Corp Earnings Call TranscriptFebruary 14, 2025 | gurufocus.comAcadian Timber Corp (TSX:ADN) Q4 2024 Earnings Report Preview: What To ExpectFebruary 12, 2025 | gurufocus.com3 TSX Dividend Stocks To Enhance Your PortfolioFebruary 5, 2025 | finance.yahoo.comSee More Acadian Timber Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Acadian Timber? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Acadian Timber and other key companies, straight to your email. Email Address About Acadian TimberAcadian Timber (TSE:ADN) Corp is a Canada-based supplier of primary forest products in Eastern Canada and the Northeastern United States. The company's operating segments include NB Timberlands and Maine Timberlands. It generates maximum revenue from the NB Timberlands segment. The company's product includes softwood and hardwood sawlogs, pulpwood and biomass by-products.View Acadian Timber ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Alphabet Rebounds After Strong Earnings and Buyback AnnouncementMarkets Think Robinhood Earnings Could Send the Stock UpIs the Floor in for Lam Research After Bullish Earnings?Texas Instruments: Earnings Beat, Upbeat Guidance Fuel RecoveryMarket Anticipation Builds: Joby Stock Climbs Ahead of EarningsIs Intuitive Surgical a Buy After Volatile Reaction to Earnings?Seismic Shift at Intel: Massive Layoffs Precede Crucial Earnings Upcoming Earnings AstraZeneca (4/29/2025)Booking (4/29/2025)DoorDash (4/29/2025)Honeywell International (4/29/2025)Mondelez International (4/29/2025)PayPal (4/29/2025)Regeneron Pharmaceuticals (4/29/2025)Starbucks (4/29/2025)American Tower (4/29/2025)América Móvil (4/29/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 4 speakers on the call. Operator00:00:00Good day and thank you for standing by. Welcome to the Acadian Timber Corp. Q3 2023 Analyst Conference Call and Webcast. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Operator00:00:26Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Susan Wood, Chief Financial Officer. Please go ahead. Speaker 100:00:36Thank you, operator. Good afternoon, everyone, and welcome to Acadian Timber's 3rd quarter conference call. With me on the call today is Adam Chaparski, Acadian's President and Chief Executive Officer. Before discussing Acadian's results, I'll first remind everyone that in discussing our Q3 financial and operating performance, the outlook for the remainder of 2023 and into 2024 and responding to your questions, we may make forward looking statements. These statements are subject to known and unknown risks and future results may differ materially. Speaker 100:01:11For further information on our known risk factors, I encourage you to review our news release and MD and A, which are available on SEDAR and on our website atacadiantimber.com. I'll begin by outlining the financial and operational highlights for our Q3 ended September 30, 2023. Adam will then provide some additional comments and discuss our outlook for the remainder of the year. Acadian generated solid financial results for the quarter ended September 30, benefiting from continued stable regional demand and pricing for its products. Sales for the Q3 were $26,600,000 compared to $23,600,000 in the same quarter of 2022. Speaker 100:01:56Sales volume excluding biomass increased 13% compared to the prior year period. Weighted average selling price excluding biomass increased 1% year over year benefiting from strong softwood sawlog and pulpwood prices driven by solid demand, partially offset by decreased hardwood sawlog prices stemming from weakness in hardwood lumber pricing. Pricing for softwood sawlogs increased 5% compared to the prior year period, driven by stable demand, while hardwood sawlog pricing decreased 12% due to declines in end use markets. Demand was strong for softwood pulpwood, resulting in a pricing increase of 19% year over year. Hardwood pulpwood pricing increased 2% over the same period of 2022. Speaker 100:02:45Biomass prices were 25% lower due to unfavorable product and customer mixes. Operating costs and expenses were $21,900,000 during the Q3 compared to $19,200,000 during the prior year period, reflecting higher sales volumes. Weighted average variable costs, excluding biomass, were consistent with the prior year period, with increased contractor rates being offset by lower fuel prices. Adjusted EBITDA was $4,900,000 during the Q3 compared to $4,500,000 in the prior year period, reflecting higher operating income and gain on sale of Timberlands. Adjusted EBITDA margin for the quarter was 18% compared to 19% in the prior year period. Speaker 100:03:35Net income for the Q3 totaled $6,400,000 or $0.37 per share compared to $4,800,000 or $0.29 per share in the same period of 2022. The increase in net income compared to the prior year period was primarily the result of higher operating income and non cash fair value adjustments as well as lower income tax expense. Acadian generated $4,300,000 of free cash flow and declared dividends of $5,000,000 to our shareholders during the 3rd quarter or $0.29 per share. I'll now move into the 3rd quarter results for our New Brunswick operations. Sales for New Brunswick in the Q3 were $22,800,000 compared to $19,900,000 during the prior year period. Speaker 100:04:22Sales volume excluding biomass increased by 15%, primarily due to increased contractor availability. With regards to softwood sawlogs and pulpwood, demand was strong with volumes 19% higher for sawlogs and 35% higher for pulpwood than the prior year period. New Brunswick pricing for softwood sawlogs and softwood pulpwood increased 8% 26%, respectively, compared to the prior year period. Hardwood sawlog volumes in New Brunswick decreased 28%, while hardwood pulpwood volumes increased 9% compared to the prior year period as a result of a change in harvest mix. Prices for hardwood sawlogs were 9% lower than the prior year period due to weekend end use markets, while prices for hardwood pulpwood were 3% higher than the prior year period due to strong demand. Speaker 100:05:19Operating costs and expenses were $17,500,000 during the Q3 compared to $15,400,000 in the prior year period, reflecting higher sales volumes. Weighted average variable costs, excluding biomass, were consistent with the prior year period, with increased contractor rates being offset by lower fuel prices. New Brunswick's adjusted EBITDA for the quarter was $5,500,000 compared to $4,600,000 in the prior year period and adjusted EBITDA margin was 24% compared to 23% in the prior year period, primarily as a result of higher operating income. Switching over to Maine. Sales remained during the Q3 totaled $3,800,000 compared to $3,700,000 in the prior year period. Speaker 100:06:09Sales volume excluding biomass increased 6%, reflecting increased contractor availability, partially offset by unfavorable weather conditions as compared to the same period in the prior year. Softwood sawlog volumes in Maine increased 5% as compared to the prior year period due to increased contractor capacity. In U. S. Dollar terms, pricing for softwood sawlogs decreased only slightly by 4% compared to Q3 2022, reflecting stable demand for fewer export sales. Speaker 100:06:40Softwood pulpwood volumes were negligible during the quarter due to the shutdown of a key customer. Hardwood sawlog volumes were also negligible during the quarter, but are typically modest in Maine. Hardwood pulpwood volumes increased 67% due to changes in harvest mix, although pricing decreased 9% in U. S. Dollar terms due to market conditions. Speaker 100:07:04Operating costs and expenses for the Q3 were $3,900,000 compared to $3,500,000 during the same period in 2022, reflecting higher harvesting activity. Weighted average variable costs, excluding biomass, were consistent with the prior year period, again with higher contractor rates offset by lower fuel prices. Adjusted EBITDA for the quarter was negative Adjusted EBITDA margin was negative 4% compared to 6% in the prior year period. With respect to Acadian's financial position at the end of the quarter, it remains strong, ending with a net liquidity position of $15,900,000 including funds available under our revolving credit facilities. With that, I'll now turn the call over to Adam. Speaker 200:08:08Thank you, Susan, and good afternoon, everyone. As always, Acadian remains committed to health and safety as our number one priority. During the Q3, there were no recordable safety incidents among our employees or our contractors. We are very proud of all the hard work and dedication towards safety that is shown on a daily basis across the entire organization. As Susan mentioned, we experienced a solid third quarter. Speaker 200:08:34While excessive rainfall impacted operations in Maine, operating conditions were favorable in New Brunswick. Ongoing efforts from the operations team resulted in increased contractor capacity and allowed us to continue to catch up on the volume shortfalls experienced earlier in the year. We now believe that this hard work has put us in a position to achieve similar total volumes experienced in fiscal 2022. As you know, the weather can play a significant role in our operations, but Mother Nature seems to be cooperating so far in the Q4. The current dynamics of the Northeast Forestry Sector resulted in stable pricing and demand during the Q3. Speaker 200:09:15There remains some tension in the supply chain, which supports the stability of our weighted average sales pricing and allows for the recovery of the increased inflationary costs that we have experienced. Although we do not usually spend much time talking about our land sales, We have accumulated more than what has been experienced in recent years. The total proceeds of $670,000 recorded in the 1st 2 quarters of 2023 on the sale of approximately 20 acres of land. We will continue to evaluate the land base in both New Brunswick and Maine. Now that we do not expect it to become a significant generator of cash flows for the business in the short term, we do believe that we will be able to continue to unlock potential in the future. Speaker 200:10:00A few comments on our carbon credit project. As we noted last quarter, the first 770,000 carbon credits associated with projects were registered in the American Carbon Registry on June 8 under the name Anew Etodden Forestry Project. The team is currently working on the 2nd reporting period, which is expected to produce approximately 215,000 credits, with the 3rd reporting period credits expected to be developed later in fiscal 2024, resulting in approximately 215,000 additional credits. We are in regular contact with our 3rd party developer and understand that volumes of carbon credit sales have slowed somewhat over the last couple of quarters as as a result of a number of factors. However, pricing for voluntary improved forest management credits appears to be stable, which we expect to bode well for a project like Acadian's. Speaker 200:10:53And as buyers gravitate toward quality, we remain optimistic with regards to the monetization of the first 770,000 credits. Turning to our outlook for the remainder of 2023 and into 2024, North American interest rates remain elevated and near term pressure on the end use market persists. However, inflationary pressures have begun to show signs of easing and the consensus forecast for U. S. Housing starts has risen to approximately 1,400,000 starts in 2023. Speaker 200:11:25We remain confident that the stability of the Northeastern Forestry Sector combined with the long term demand for new homes and recurring remodel activity will continue to support the demand for our products. The labor markets remain tight. As I noted, we continued to Increased contractor availability during the Q3. Some challenges remain and management will continue to focus on further increasing our harvesting capacity through the remainder of the year and into 2024. In the short to medium term, inflation is expected to continue to impact our financial results through elevated contractor rates and fuel surcharges. Speaker 200:12:02Demand for Acadian sawlogs is mainly driven by regional supply and demand, meaning that the stable demand experienced during the 1st three quarters is expected to continue the balance of 2023. Pricing for softwood sawtimber is expected to remain consistent for the remainder of the year. And although we have seen weaknesses in hardwood sawtimber pricing throughout the summer, they appear to have stabilized as we exited the quarter. Demand for hardwood pulpwood is expected to remain steady and softwood pulpwood markets are expected to remain at the improved levels experienced to date in 2023. In summary, as we finish the year, We expect continued solid financial and operating performance. Speaker 200:12:46Progress made increasing contractor availability will benefit Acadian for the rest of 2023 and into the winter harvest season of 2024 and will remain a key focus. Acadian continues to benefit from a strong balance sheet, continued diversification of our markets and a highly capable team focused on strong financial and operating performance. As always, we will remain focused on merchandising our products to obtain the highest margins available and making improvements throughout the business to maximize cash flows from our existing timberland assets. We continue to explore opportunities to grow as demonstrated by our advancement into the carbon credit market, Opportunistic land sales as evidenced year to date and exploring additional land use opportunities, such as renewable energy and additional land leasing. With that, we are now available to take your questions. Speaker 200:13:38Operator? Operator00:13:56Our first question will come from Arianna Mellon of CIBC Capital Markets. Your line is open. Speaker 300:14:04Hello. I hope all is well. My first question relates to contractor availability. In the MD and A, you mentioned that you'll Continue to focus on increasing harvesting capacity in Q4 and into 2024. Do you see regional Speaker 200:14:29Good question. We've been working really hard at it. I think that as we move Through the remainder of the fall of 2023 and into 2024, I think there's still some availability there for us. Through a lot of hard work by the team here, we've really been able to increase our understanding of the rates and what Stresses our contractors, so we've been successful in increasing our capacity. Appreciate we're taking some of that from other people. Speaker 200:15:01So there will be some As far as the limit, I believe there probably is. At some point, there's going to be a limit. But I do feel strongly that we're going to be able to achieve what we need to achieve from a contractor capacity to be allowed to allow us to cut Our full harvest moving forward. So as a large landowner, the stability that affords us and it would afford a contractor makes it More attractive and now that we have a handle on our contractors, I'm feeling very confident as we move forward. Speaker 300:15:38Okay. Thanks. That's helpful. And then with regard to hardwood lumber prices, you mentioned that you've seen prices Do you expect this to continue? Or do you still view further price increases as a risk in the near term? Speaker 200:15:53Yes. And so there's hardwood lumber prices, which obviously end use, not our business, but it had an impact on our customers. That's a tough one. We understand they're stabilizing. I don't think I'm not sure it can go much lower to be honest Based on what we're hearing from our customers, fortunately for our business, the sawtimber business, We have a supply that is limited. Speaker 200:16:27And so when I say supply, regional That is limited, which has allowed us to keep our pricing pretty stable in relationship to the prices of lumber and hardwood lumber in particular. So We're feeling pretty confident that our prices have stabilized inside of Acadian moving forward. And now the business will be to Make sure that we start increasing that as the price of lumber starts to increase in the future. Speaker 300:16:55Okay, great. Thanks. That's all I have for now. So I'll get back in the queue. Speaker 200:16:59Great. Thanks, Arianna. Operator00:17:27And I would now like to turn the conference back to Adam for closing remarks. Speaker 200:17:32Thank you, operator. On behalf of the Board and management of Acadian, I would like to thank all of our shareholders for their ongoing support. Thank you. Stay safe and we look forward to you joining us for our Q4 conference call on February 8. Goodbye. Operator00:17:49And this concludes today's conference call. Thank you for participating. You may now disconnect.Read morePowered by