February 20, 2008 / 9:51 PM / 10 years ago

UPDATE 1-West Fraser posts loss on weak lumber markets

VANCOUVER, British Columbia, Feb 20 (Reuters) - The weak U.S. housing market pushed lumber producer West Fraser Timber Co (WFT.TO) into a fourth-quarter loss, the company said on Wednesday, but the pain was eased slightly by tax-related gain.

West Fraser said it had a net loss of C$3 million, or 7 Canadian cents a share, in the quarter. It recorded a income tax recovery gain of C$67 million in the period and its operating loss was C$64 million.

That compared with a net profit of C$296 million, or C$6.87 per share, in the same quarter a year earlier, during which the company’s results were boosted by a repayment of duties after the settlement of the U.S.-Canada lumber trade fight.

“We are obviously experiencing a very severe down cycle with a combination of the collapse of the U.S. housing market and a very strong Canadian dollar,” chief executive Hank Ketcham said in a statement.

Weak lumber markets hit both its Canadian and U.S. sawmills, but pulp operations remained strong, the company said.

Ketcham said there was “very little we can do” about the housing market or the Canadian dollar and that the company was focusing on reducing costs.

$1=$1.01 Canadian Reporting Allan Dowd, Editing Peter Galloway

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