Acadian Timber (TSE:ADN) reported higher fourth-quarter sales and adjusted EBITDA as improved weather and better contractor availability in New Brunswick lifted harvest volumes, partially offset by weaker pricing and continued logistical constraints in Maine. Management also provided an update on its ongoing shift to internal harvesting operations in Maine, discussed current market pressures tied to trade policy uncertainty, and outlined expectations for 2026 volumes, costs, and carbon-credit timing.
Fourth-quarter results: higher volumes, softer pricing
Chief Financial Officer Susan Wood said overall freehold timber sales volumes (excluding biomass) rose 21% versus the fourth quarter of 2024, supported by favorable weather conditions across both operating regions. Sales increased to CAD 22.0 million from CAD 20.2 million a year earlier, while the company’s weighted average selling price (excluding biomass) fell 6% year-over-year due largely to product mix, hauling distances, fuel adjustment surcharges, and lower timber services activity.
Net income was CAD 39.7 million (CAD 2.18 per share), compared with CAD 5.6 million (CAD 0.32 per share) in the same period of 2024. Wood attributed the increase largely to higher gains on non-cash fair value adjustments in 2025 versus 2024, partially offset by lower operating income and higher income tax expense.
Acadian generated CAD 1.9 million of free cash flow in the quarter and declared CAD 5.3 million in dividends (CAD 0.29 per share).
Regional performance: New Brunswick strength, Maine remains constrained
In New Brunswick, fourth-quarter sales rose to CAD 19.0 million from CAD 17.2 million. Sales volume excluding biomass increased 23% due to improved contractor availability and a customer mix shift that resulted in more harvesting on freehold timberlands and less on Crown licensed timberlands. Wood said softwood sawlog demand was strong, with volumes up 54% year-over-year and pricing flat versus the prior-year quarter. Hardwood sawlog volumes fell 23% and pricing declined 12%, which management linked to weak end-use markets and a lower-value product mix.
Softwood pulpwood volumes in New Brunswick rose 21% with pricing consistent year-over-year, while hardwood pulpwood volumes fell 18% and pricing declined 13% amid tariff uncertainty and changes in hauling distances and fuel adjustments. New Brunswick’s weighted average selling price (excluding biomass) declined 6%.
New Brunswick operating costs and expenses were CAD 13.6 million versus CAD 13.4 million a year ago. Wood said weighted average variable costs (excluding biomass) fell 15% due to a higher proportion of softwood products, lower harvesting costs tied to the harvesting method used, shorter hauling distances, and lower fuel adjustment costs. Adjusted EBITDA in New Brunswick increased to CAD 5.5 million from CAD 4.2 million, and margin improved to 29% from 24%.
In Maine, fourth-quarter sales were $3.0 million, consistent with the prior-year period. Sales volume excluding biomass rose 5% on better weather, but deliveries were “hindered by limited trucking capacity,” Wood said. Softwood sawlog volumes increased 12%, while reported pricing fell 12% in U.S. and Canadian dollar terms due to stumpage sales (which did not occur in the fourth quarter of 2024) and more roadside sales, partially offset by a higher-value product mix. Excluding stumpage sales, softwood sawlog pricing increased 6%.
Hardwood sawlog volumes were described as negligible, and softwood pulpwood volumes were also negligible due to the extended shutdown of a major softwood pulpwood customer. Hardwood pulpwood volumes were consistent, though pricing decreased 6% due to lower demand. Maine’s weighted average selling price excluding biomass fell 8% primarily due to stumpage sales; excluding stumpage, it increased 3%.
Maine operating costs and expenses increased to $3.8 million from $3.3 million due to higher operating costs per cubic meter produced. Adjusted EBITDA was -$53,000 (versus -$223,000), and margin was -2% (versus -7%).
Balance sheet and safety update
Wood said Acadian ended the quarter with a “strong” financial position, including net liquidity of $17.4 million, cash of $4.8 million, and undrawn revolving credit facilities.
President and CEO Adam Sheparski said the company had no recordable safety incidents during the fourth quarter, reiterating that safety performance remains a key focus and a leading indicator of broader business success.
Full-year 2025: lower revenue and EBITDA compared with carbon credit year
For 2025, Sheparski said revenues for timber sales and services were $87.0 million, down from $91.6 million in 2024. He noted that in 2024, carbon credit sales contributed an additional $24.6 million to total sales, while there were no carbon credit sales in 2025.
Adjusted EBITDA totaled $15.8 million, down from $38.9 million in 2024, and adjusted EBITDA margin was 18% versus 33% in the prior year. Sheparski said New Brunswick delivered increased sales and volumes, lower variable costs, and higher adjusted EBITDA compared with 2024, which helped offset operational challenges in Maine.
Across the business, timber sales volume excluding biomass was consistent year-over-year, but pricing softened modestly and timber services activity declined. New Brunswick volumes excluding biomass increased 10%, while Maine volumes declined 40% due to unfavorable weather in the first half, limited trucking capacity, and short-term productivity impacts from the operational transition.
2026 outlook: market uncertainty, Maine productivity focus, carbon credit timing
Looking to 2026, Sheparski said near-term pressures on end-use markets have continued, and trade policy developments have added complexity, including escalating U.S. duties on Canadian softwood lumber and tariffs on select wood-based products. He added that macro indicators remain supportive, citing easing North American interest rates and an outlook for U.S. housing starts of approximately 1.38 million in 2026 compared with 1.35 million in 2025.
Operationally, Sheparski said contractor availability in New Brunswick is expected to remain sufficient in 2026. In Maine, production from internal harvesting operations improved in the fourth quarter of 2025 and is expected to continue through winter, supporting progress toward the targeted cost structure. He said production typically eases in the second and third quarters due to the seasonal spring slowdown and lower productivity of stands planned for warmer months.
In the Q&A, Sheparski addressed Maine harvest volume targets by pointing to annual allowable volumes disclosed in the company’s AIF, describing it as about 240,000 cubic meters and suggesting a roughly 10% reduction due to marketability issues “with softwood pulpwood.” On costs, he said operating costs per cubic meter remained elevated—about 30% above long-term targets as of the fourth quarter—reflecting a more fixed cost structure under internal operations. He emphasized productivity as “crucial” and said most of the levers to close the gap are under the company’s control through its internal logging operations.
Sheparski also discussed hardwood markets, saying volume is not currently the issue for hardwood sawlogs; rather, it is the ability to push pricing through to customers given subdued hardwood lumber end-use markets. On potential longer-term trucking solutions, he said the company is monitoring developments such as autonomous trucking but has “nothing obviously to report” and has not taken action to date.
On carbon credits, Sheparski said demand and pricing are expected to remain stable. He said registration of the next batch of credits for the ongoing Maine project was delayed in 2025 due to transitioning to version 2.1 of the ACR Improved Forest Management Protocol, but is expected “in the near term” and is expected to be approximately 400,000 credits. He added that while the updated protocol may reduce total credits slightly versus earlier expectations, the credits generated will be carbon removal credits, which he said are generally more attractive to customers and expected to command higher pricing. Beyond the current project, he said Acadian is evaluating additional project opportunities across its remaining 900,000 acres under a Canadian compliance protocol finalized in 2024 or through voluntary programs similar to the current project.
Management said it expects to remain active in real estate in 2026, including beginning sales of residential lots, and to continue pursuing renewable energy investments and partnerships in Maine and New Brunswick. Sheparski said priorities for 2026 include safety and environmental stewardship, improving margins and cash flow, and a continued focus on improving productivity and controlling costs in Maine’s internal harvesting operations while working with contractors in both regions to meet harvesting and delivery goals.
About Acadian Timber (TSE:ADN)
Acadian Timber 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.
