Forestry revenue rebounding, but not back to 2015 high

B.C. employment for the top companies has dropped significantly over the past year

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Revenue is recovering for B.C.’s largest forestry companies, but their local employment numbers have taken a serious hit over the past year, according to data collected on BIV’s Biggest Forestry Companies in B.C. list.

Average revenue for the top forestry companies with data available is down since 2015, primarily because of a steep 30.2% decline to $1.83 billion in 2016 from $2.63 billion in 2015. Since then, the average revenue for those companies rebounded, but it has yet to return to 2015 levels growing 16.1% to $2.13 billion in 2020.

While revenue is down since 2015, B.C. employment at the top forestry companies had been growing, that is until this year.

In 2015, average size of B.C. staff at the top forestry companies was 1,048 employees; in 2016 it fell 8.75%. It took only one year for average employment to fully recover, and it continued to grow to 1,1056  employees in 2019, up 15.7% from the 2016 low of 956.

However, over the past year average employment sank 13.6% to 955.8,  slightly below the 2016 average.

No. 14 Conifex Timber Inc. (TSX:CFF) had the largest one-year decline in employment: down 39.7% to 251 in 2020 from 416 in 2019.

Conifex’s revenue also tumbled over the past year. It fell by 58.5% to $157 million in 2019 compared with $379 million in 2018.

Of the companies with revenue data available, only two recorded growth. No. 8 Mercer International Inc. (Nasdaq:MERC) had the largest one-year revenue increase. It grew 14.1% to $2.16 billion in 2019 from $1.89 billion in 2018.

Pinnacle Renewable Energy Inc. (TSX:PL), the other forestry company on the list with revenue growth, posted an 8.7% increase in 2019.

Even though their average revenue has yet to return to 2015 levels, the top five companies with revenue data available increased their revenue an average of 17.3% between 2015 and 2019.

Only one company, No. 4 Western Forest Products Inc. (TSX:WEF) suffered a five-year decline. Its revenue dropped 25.3% to $807.7 million in 2019 from $1.08 billion in 2015.

Mercer International had the largest five-year increase in revenue out of the top five. It rose to $2.16 billion in 2019, up 63.2% from $1.32 billion in 2015. •