Interfor remained in the red during the second quarter as its net loss widened to C$5.3 million (US$5.5 million), compared to a C$3.5 million (US$3.6 million) loss during the same period a year ago, the company announced on Thursday. This is the second straight quarter the company has been in the red as it started the year off with a C$1.7 million (US$1.8 million) loss during the first quarter.

Total sales at the Vancouver, B.C.-based company improved 19.2% during the quarter to C$188.2 million (US$194.4 million), while operating earnings jumped into the black with results of C$200,000 (US$206,612), compared to a C$2 million (US$2.1 million) operating loss a year ago. EBITDA, which the company defines as earnings before finance costs, taxes, depreciation, depletion, amortization, restructuring costs, other foreign exchange gains and losses and asset write-downs, fell 15.3% to C$11.6 million (US$12 million).

The company's lumber segment posted an 8.3% increase in sales to C$134 million (US$138.4 million). Interfor's log segment reported a 44.4% increase in net sales to finish at C$28.6 million (US$29.5 million).

Lumber sales for the quarter increased 23.7% to 334 million board feet, while production increased 17.3% to 325 million board feet. Log sales, meanwhile, increased 19.8% to 314 thousand cubic meters as production increased 27.6% to 796 thousand cubic meters.

Despite the increases in sales and production for both lumber and logs, the company said demand for lumber was weak during the quarter.

"U.S. housing starts returned to the lowest levels since the downturn began in 2008," said the company in a statement that accompanied its earnings report. "In addition, severe weather conditions through the West, Midwest, and East coast of North America hampered building starts, transportation and seasonal buying resulting in lower sales volumes through the first six months [of 2011]."

The company said it will continue to focus on balancing production rates against market demand and that business conditions remain uncertain.