JEWETT CAMERON TRADING CO LTD
For the period ended Feb 28, 2026. Filed Apr 13, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Feb 28, 2026 · Filed Apr 13, 2026
JCTC$2.85-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-11-30; filed 2026-01-14.
0001079973-26-000083
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-02-28; filed 2026-04-13.
0001553350-26-000067
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 89 previous paragraphs and 101 current paragraphs.
52 unchanged; 21 reworded; 26 added; 15 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 14 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (26)
Current report
In February 2026, the Supreme Court of the United States ruled the President did not have the authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA). This ruling invalidated certain of the current tariffs levied since February 2025, including the additional country-specific tariffs and the fentanyl related levy. However, the tariffs on imported steel and aluminum products were not affected by the ruling, as those tariffs were levied under a different section of the Trade Act which was not subject to the Court’s determination. We may be eligible to receive refunds of certain tariffs we paid that were levied under the IEEPA. If it is determined that we are eligible for refunds, the availability, amount and timing of such refunds is uncertain and subject to further developments. However, a majority of the tariffs we have paid since the new tariffs were first announced in February 2025 have been levied under Section 232, including the steel and aluminum tariff and other historic tariffs which are unaffected by this court decision. Therefore, any potential refund will only be a small percentage of the overall tariffs we have paid over the prior 12 months.
Current report
Since the Supreme Court ruling, the Presidential Administration has announced its intent to levy new sets of tariffs imposed under a different section of the Trade Act which would not fall under the IEEPA. On February 24 th, a new temporary 10% global import duty took effect for 150 days. However, imports covered under Section 232 tariffs, which include the steel and aluminum products, are excluded from this additional 10% rate. On April 2, 2026, the Section 232 steel and aluminum tariffs were adjusted. Under the new rule, the Section 232 steel and aluminum tariffs were adjusted. Previously, a 50% tariff was levied on the original value of the foreign metal in the imported product. Under the new rule, the tariff rates on most imported steel and aluminum products will range from 25 to 50%, but will now be calculated on the full value of the imported products, which in some cases may potentially increase the amount of tariff due. We are currently evaluating the new tariff proclamation and how it will apply to our imported products.
Current report
During the second quarter, we made important progress toward our goals to refocus on our operational strengths while reducing costs. We successfully sold the majority of our excess lumber inventory and continued to grow our Lifetime Steel Post sales through both our existing accounts and through the addition of new customers.
Current report
Our sales for the second quarter increased by $1,482,259, or 16% over Q2 2025. Our current six-month sales rose by $868,726, or 5%, over the first six months of fiscal 2025. However, approximately $2.5 million of these sales were from the liquidation of certain pet inventory and the sale of our excess cedar fencing inventory, and those sales will not be repeated in future periods. Our net loss for the second quarter was ($1,248,928), or ($0.35) per share, and our net loss for the six months was ($5,193,067), or ($1.48) per share. Our six-month results were negatively affected by an inventory write-down of $2,208,813 we took in the first quarter related to the liquidation sales.
Current report
With the customer’s notice they were terminating the consignment agreement, this excess inventory became surplus to our needs. This inventory was not only incurring storage costs and represented a significant drain on our available capital, it also was subject to the potential of weathering or other deterioration which would further erode its value over time. During the first quarter, we took a write-down on its value to reflect our estimates of its current value. During the second quarter we successfully negotiated with the consignment customer for them to purchase the portion of the inventory already present in their distribution facilities at the originally contracted prices. We then sold the remaining excess inventory to a lumber wholesaler. The inventory we sold to the consignment customer at the contracted prices resulted in a small profit, but the other excess inventory was sold below our cost. However, the sale of this inventory unlocked a significant amount of stranded capital which we are utilizing to acquire other inventory for our traditionally busier Spring and Summer season while reducing the need for us to borrow additional amounts under our line of credit.
Current report
Import tariffs remain a significant issue for our operations. Since the implementation of the additional tariffs beginning in February 2025, our tariff costs have increased substantially. Since 2023, we have successfully migrated much of our production from China to other lower-tariffed countries. This has helped us successfully mitigate some of the 2025 tariffs, particularly the China-specific levies, that otherwise would have resulted in greater import costs.
Current report
In February 2026, the United States Supreme Court ruled that tariffs that were imposed under the International Emergency Economic Powers Act (IEEPA) were not legal. This ruling invalidated certain of the current tariffs levied since February 2025. We may be eligible to receive refunds of certain IEEPA related tariffs, but if so, any refunded amounts will be a small fraction of the overall amounts we have paid in tariffs over the last year. Most of the tariffs levied on our imported goods are unaffected by the Supreme Court ruling and remain in effect, including the 50% Section 232 steel and aluminum tariffs. As set forth above, we are currently evaluating the new Section 232 tariffs and how it will apply to our imported products. However, this change is unlikely to relieve much, if any, of the overall tariff rate on our imported metal products, and may in some cases increase the tariffs we are required to pay.
Current report
These tariffs have tremendously disrupted our markets and consumer buying habits. In addition to increasing our direct costs, the shift in manufacturing away from China has caused increases to logistical and shipping costs as the supply chains from these alternative countries are less developed than from China. These higher costs resulted in a double-digit reduction in overall gross margins across the majority of our product lines.
Current report
Sales in our metal fencing were down year-over-year which is largely attributable to difficult market conditions from the tariff situation. Higher sales of our Lifetime Steel Post® (LTP) were offset by lower sales for our Adjust-A-Gate and other fencing products. Our in-store displayers continue to drive consumer engagement. We have added new customers to the display program, including orders for new in-store display units from other retailers which are shipping in the third quarter. Significant growth opportunities remain in the fencing sector, both through the expansion of our existing products into more stores and through new sales channels. We are developing improvements and enhancements to our existing products, and evaluating outside products from third parties that complement our current product lines and to expand our product offerings.
Current report
The pet market has been particularly hard hit by the weakness in consumer purchases. Pet adoptions declined drastically post-pandemic as workers returned to the office, which reduced demand for our non-consumable product offerings such as metal crates and kennels. This trend has continued as consumers continue to restrain their discretionary spending which has further depressed the overall pet market. As a result, we have been burdened with excess pet inventory above our forecasted sales, which we have been liquidating during the current six-month period. Although these sales recapture some of our inventory costs and will reduce our ongoing warehousing costs, these sales have been made at below cost which have depressed our overall margins. Although we believed we had made adequate inventory allowances in the previous fiscal year to reflect market conditions, we recorded an additional $550,000 inventory allowance in the current period to reflect the difference between our costs and the revenue from these sales. Overall, our pet sales are down about 40% year over year as retailers have sufficient inventory on hand and are currently limiting their inventory purchases.
Current report
Due to the continued uncertainty and higher costs stemming from the high global tariff levels and the conflict in the Middle East, we expect fiscal 2026 to remain challenging. Fuel prices have risen dramatically worldwide since the outbreak of miliary action in the Persian Gulf in March 2026. We are now beginning to incur higher shipping and logistic costs as our providers are raising their rates and implementing immediate fuel surcharges to cover their higher costs, but our ability to quickly pass on these costs to our customers is limited. We expect this will further compress our margins for the remainder of the fiscal year. In addition, periods of high fuel prices, particularly gasoline, have historically led to significant decreases in discretionary spending by American consumers which may negatively affect demand for our products during our traditionally busier Spring and Summer seasons.
Current report
We are also evaluating strategic options for the Company that prioritize the Company’s overall value. Strategic options under consideration may include mergers, acquisitions, divestitures, joint ventures and other business collaborations and partnerships that would potentially involve specific assets or business lines of the Company. There can be no assurance that these discussions will result in definitive agreements or the completion of any transaction. The Company does not intend to provide further updates on these discussions unless and until a definitive agreement is reached.
Current report
Sales for the three months ended February 28, 2026 were $10,537,210 compared to sales of $9,054,951 for the three months ended February 28, 2025, which was an increase of $1,482,259, or 16%. Sales in the current quarter were increased by the higher LTP sales, higher sales at Greenwood, and the liquidation of certain pet and fencing inventory.
Current report
Sales at JCC were $9,086,177 in the three months ended February 28, 2026, compared to sales of $7,943,319 in the three months ended February 28, 2025. This represents an increase of $1,142,858, or 14%. The increase in revenue was due to higher LTP sales and higher sales at Greenwood. We also liquidated certain slow-moving pet inventory and our excess cedar fencing which was acquired prior to the termination of our consignment sales agreement with a major retailer, and those sales will not be repeated in future periods. Operating loss for the current quarter was ($814,083) compared to an operating loss of ($834,127) for the quarter ended February 28, 2025. The operating results of JCC are historically seasonal with the first two quarters of the fiscal year being slower than the final two quarters of the fiscal year.
Current report
Sales at Greenwood were $1,451,034 compared to sales of $1,111,632 for the three months ended February 28, 2025, which is an increase of $339,402, or 31%. Demand from transit customers continue to recover from workers returning to offices. We are also receiving higher sales from non-transit customers. For the three months ended February 28, 2026, Greenwood had an operating profit of $167,242 compared to an operating loss of ($24,035) for the three months ended February 28, 2025.
Current report
Gross margin for the three months ended February 28, 2026 was 15.7% compared to 20.1% as of February 28, 2025. The decrease was primarily due to the liquidation of certain pet inventory and surplus cedar fencing at prices below cost. We also sold higher volumes of lower margin products in the current period. Our costs have also continued to rise, due to higher raw material costs, higher shipping and logistic costs, and the new import tariffs which began in March 2025.
Current report
Operating expenses increased by $174,898 to $2,761,093 compared to expenses of $2,586,195 for the three months ended February 28, 2025. Selling, General and Administrative expenses rose to $1,435,093 from $940,168, which was primarily due to higher professional fees related to the engagement of outside consultants in the period. Wages and Employee Benefits declined to $1,263,765 from $1,564,799 due to a lower headcount during the current quarter. Depreciation and Amortization decreased to $62,235 from $81,228. Interest expense, which was largely due to interest on the line of credit, was ($137,459) compared to interest income of $9,096 in the year-ago quarter. Other income in the current quarter was $Nil compared to income of $306 in the quarter ended February 28, 2025.
Current report
Six Months Ended February 28, 2026 and February 28, 2025
Current report
Sales were $19,190,677 for the six months ended February 28, 2026 compared to sales of $18,321,951 for the six months ended February 28, 2025, which is an increase of $868,726, or 5%.
Current report
Sales at JCC rose slightly to $16,515,191 from sales of $16,368,287 for the six months ended February 28, 2025. Some of our customers have not yet fully accepted the higher prices for our products caused by inflation and tariffs, which reduced our sales in the period. Our sales were also negatively affected by the cybersecurity event in October, which hampered our ability to ship products for several weeks. Current sales were assisted by the one-time liquidation of certain pet inventory and the sale of excess cedar fencing. Operating loss at JCC for the six months ended February 28, 2026 was ($4,707,241) compared to an operating loss of ($1,754,365) in the prior six months ended February 28, 2025. Higher raw material, shipping and tariff costs hurt our margins in the current period, which were also negatively affected by the liquidation of the certain pet inventory and excess fencing. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year being slower than the final two quarters of the fiscal year.
Current report
Sales at Greenwood increased to $2,675,486 from $1,953,665 for the six months ended February 28, 2025. Demand by municipalities and transit operators has continued to recover from the post-pandemic lows as more workers return to offices. We also added new non-transit industrial customers during the current six months. For the six months ended February 28, 2026, Greenwood had an operating profit of $292,523 compared to an operating loss of ($47,865) for the six months ended February 28, 2025.
Current report
Gross margin for the six-month period ended February 28, 2026 was 3.0% compared to 19.2% for the six months ended February 28, 2025. Our margins were negatively affected in the current six months due to higher product, shipping and tariff costs, and the liquidation sales of certain pet inventory and surplus cedar fencing at below cost which was supported by the $2,208,813 in additional inventory write-downs we took during the first quarter. Our sales also shifted to a higher volume of lower margin products.
Current report
Operating expenses for the six months ended February 28, 2026 were $5,466,776 compared to $5,138,242, which is an increase of $328,534, or 6%. The increase was due to higher Selling, General and Administrative expenses, which rose to $2,836,128 from $1,749,380 which was primarily due to higher professional fees related to the engagement of consultants to assist us with operations and strategic planning. Wages and Employee Benefits declined 23% to $2,490,803 from $3,226,567 due to a lower employee headcount during the current six months. Depreciation and Amortization decreased to $139,845 from $162,295 for the six months ended February 28, 2025.
Current report
Interest expense related to borrowing against the line of credit was ($266,608) in the current six-month period. The prior six month period ended February 28, 2025 had other income of $306, interest income of $31,094 and gain on sale of assets of $800. Income tax expense for the six months ended February 28, 2026 was ($30,015) compared to income tax recovery of $364,621 for the six months ended February 28, 2025. The Company estimates income tax expense for the period based on combined federal and state rates that are currently in effect.
Current report
Net loss for the six months ended February 28, 2026 was ($5,193,067), or ($1.48) per basic and diluted share, compared to a net loss of ($1,231,811), or ($0.35) per basic and diluted share, for the six months ended February 28, 2025.
Current report
During the six months ended February 28, 2026, the Company issued the Company issued 3,782 common shares to officers, directors and employees under the Restricted Share Plan. The value of these shares was $9,077. In December 2025, the Company cancelled 1,788 common shares valued at $8,301 which were previously issued but unvested under the Restricted Share Plan for an employee who left the Company.
Removed paragraphs (15)
Previous report
Pet, Fencing and Other
Previous report
Corporate and Administrative Services
Previous report
Industrial Wood Products
Previous report
Our operations continue to be challenged by the high levels of import tariffs, negative consumer buying trends, and certain operational issues which we are diligently working to resolve. These issues have negatively affected our first quarter results, as sales declined by 7% and our net loss was ($3,944,139), or ($1.12) per share. The current quarter’s net loss was increased by $2,208,813 for the write-down of inventory during the quarter which was primarily related to our excess lumber inventory and liquidation of certain pet inventory.
Previous report
The current import tariffs, including those on imported metal products, remain a significant strain on our operations. Our markets have been tremendously disrupted, both directly and indirectly, by these new tariffs since their implementation began in February 2025. The direct impacts include cost increases to our supply chain and logistics, and indirectly by their negative effect on consumer confidence which has significantly reduced product demand. These higher costs resulted in a double-digit reduction in overall gross margins across the majority of our product lines.
Previous report
The pet market continues to be sluggish due to low consumer demand and high retailer inventory levels. We remain burdened with high inventory levels of bulky metal crates and kennels that incurred inflated transportation costs from the supply chain crisis. This has made their pricing less competitive while taking up valuable warehouse space. We began to liquidate this older inventory in the first quarter of fiscal 2026. Although these sales recapture some of our inventory costs and will reduce our warehousing costs, these sales are being made at a substantial discount to our historical costs which had a substantial negative effect on our first quarter margins. Although we believed we had made adequate inventory allowances in the previous fiscal year to reflect market conditions, we have recorded an additional $550,000 inventory allowance in the current quarter to reflect ‘current liquidation rates’ as the pet market remains depressed and we expect to continue the liquidation of these products in future quarters until we have sold all the excess inventory.
Previous report
We have earnestly been working to reduce our product costs. The multi-country sourcing initiative we began over two years ago has successfully mitigated some of the increased tariffs. We shifted production of our Lifetime Steel Posts® from China to lower-tariffed Vietnam which has helped reduce our direct tariff costs, but shipping and logistic costs in Vietnam remain high. To reduce those costs, we are implementing a new direct import program scheduled to begin later in fiscal 2026. This should improve our LTP and overall margins, as the rollout of our in-store display units continue to successfully grow our lower margin LTP sales, which are up nearly 30% on a dollar basis quarter over quarter.
Previous report
For the three months ended November 30, 2025, sales were $8,653,467 compared to sales of $9,267,001 for the three months ended November 30, 2024. This is a decrease of $613,534, or 7%. Our sales were negatively affected by the higher tariff rates and lower lumber sales in the current period combined with the continuing negative consumer sentiment. The cybersecurity incident we suffered in October also impacted our ability to process and deliver orders for several weeks which reduced our revenues during the quarter.
Previous report
Sales at JCC were $7,429,015 compared to sales $8,424,968 for the three months ended November 30, 2024, which was a decrease of $995,953, or 12%. Our customers continue to be slow to accept higher prices for our products caused by inflation and tariffs, and the impacts of the cybersecurity incident also reduced our sales in October. Sales of our fencing products were up 2% from the 1 st quarter in fiscal 2025, which was driven by higher sales of our LifeTime Steel Posts (LTP), although pricing for these products remained relatively static due to customers resisting price increases. This compressed our margins as our costs increased due to higher raw material, shipping and tariff costs, which also affected our revenues and margins for our other fencing products. In lumber, our consignment customer reduced their purchases in advance of their notification of terminating the agreement we received in November. For our pet products, we commenced some liquidation of our slower moving inventory which hurt our revenues and margins compared to the comparable prior year’s quarter. Operating loss for JCC was ($3,893,158) compared to an operating loss of ($920,237) for the quarter ended November 30, 2024. The loss in the current quarter included a $2,208,813 inventory write-down related to our excess lumber and liquidation of certain pet inventory. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Previous report
Sales at Greenwood for the three months ended November 30, 2025 were $1,224,452 compared to sales of $842,033 for the three months ended November 30, 2024, which was an increase of $382,419, or 45%. Demand by municipalities and transit operators continues to strengthen, while revenues were further boosted by the addition of a new non-transit industrial customer. For the quarter, Greenwood had an operating profit of $125,281 compared to an operating loss of ($23,830) for the three months ended November 30, 2024.
Previous report
Gross margin for the three month period ended November 30, 2025 was negative 12.5% compared to a positive 18.3% for the three months ended November 30, 2024. The largest effects on our current margins were due to the $2,208,813 in additional inventory write-downs we took during the current quarter and a shift in our sales to a higher volume of lower margin products. Our product costs continued to rise in the quarter, particularly due to the higher import tariffs and higher shipping and logistic costs, while our ability to pass on these costs to customers remained limited as they have been slow to accept higher prices. Our margins were also negatively affected by the liquidation sales of certain of our pet inventory which began in the current quarter. Without these negative impacts, we believe our margins would have been higher but still below where we need them to be.
Previous report
Operating expenses rose to $2,705,683 in the current quarter compared to $2,552,047 expended in the three months ended November 30, 2024. Selling, General and Administrative Expenses rose to $1,401,035 from $809,213 which was primarily due to higher professional fees related to the engagement of additional consultants in the period and increases to our lumber warehousing costs. Wages and employee benefits dropped significantly to $1,227,038 from $1,661,768 as we continued to reduce our headcount. Depreciation and Amortization decreased to $77,610 from $81,066.
Previous report
Loss from operations for the current quarter was ($3,784,615) compared to a loss of ($858,145) for the quarter ended November 30, 2024 as the additional inventory reserves taken in the current quarter increased the quarterly loss by ($2,208,813).
Previous report
Other items in the current quarter included interest expense of ($129,149) which was primarily due to interest paid on our line of credit. In the prior year’s quarter, we recorded a gain on sale of property, plant and equipment of $800 and interest income on our cash balances of $21,998.
Previous report
During the quarter, the Company issued no common shares.
Reworded paragraphs (21)
Previous wording
These unaudited financial statements are those of the Company and its wholly owned subsidiaries. In the opinion of management, the accompanying consolidated financial statements of Jewett-Cameron Trading Company Ltd., contain all adjustments, consisting only of normal recurring adjustments, necessary to fairly state its financial position as of November 30, 2025 and August 31, 2025 and its results of operations and cash flows for the three month periods ended November 30, 2025 and 2024 in accordance with U.S. GAAP. Operating results for the three month period ended November 30, 2025 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2026. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Current wording
These unaudited financial statements are those of the Company and its wholly owned subsidiaries. In the opinion of management, the accompanying consolidated financial statements of Jewett-Cameron Trading Company Ltd., contain all adjustments, consisting only of normal recurring adjustments, necessary to fairly state its financial position as of February 28, 2026 and August 31, 2025 and its results of operations and cash flows for the three and six month periods ended February 28, 2026 and 2025 in accordance with U.S. GAAP. Operating results for the three and six month periods ended February 28, 2026 are not necessarily indicative of the results that may be experienced for the fiscal year ending August 31, 2026. Overall, the operating results of JCC are seasonal with the first two quarters of the fiscal year historically being slower than the final two quarters of the fiscal year.
Previous wording
Beginning in February 2025, the new administration in the United States began to increase tariff rates on numerous products from a range of nations. Imported steel and aluminum products from all countries globally were assigned a new tariff rate of 25% in addition to any specific country or product rates. In early April 2025, the U.S. imposed a universal baseline 10% tariff rate on imports globally along with a list of product exemptions. As of June 4, 2025, the tariff on steel and aluminum imports was raised to 50%. Our steel products imported from countries other than China are subject to the 50% tariff rate, but not the 10% universal baseline tariff. China, however, has been assigned special rates. Tariff rates on steel products imported from China were at 95% through November 9, 2025, but were reduced to 85% thereafter.
Current wording
Beginning in February 2025, the new administration in the United States began to increase tariff rates on numerous products from a range of nations. Imported steel and aluminum products from all countries globally were assigned a new tariff rate of 25% in addition to any specific country or product rates. In early April 2025, the U.S. imposed a universal baseline 10% tariff rate on imports globally along with a list of product exemptions. As of June 4, 2025, the tariff on steel and aluminum imports was raised to 50%. Our steel products imported from countries other than China are subject to the 50% tariff rate, but not the 10% universal baseline tariff. China, however, has been assigned special rates which are considerably higher than those assigned to other nations.
Previous wording
We are continuing our shift to suppliers outside of China which have lower tariff rates, primarily to Bangladesh and Vietnam. We currently import approximately 5% of our metal products from China. We also face uncertainty in the interpretation of new tariffs and their applicability, including with respect to customs valuation, product classification and country-of-origin determinations. Although we and our suppliers seek to comply with applicable customs laws and regulations, the application of rules regarding new tariffs can be subject to varying interpretations or future re-interpretations. It is possible that U.S. or other relevant authorities could, upon review or audit, disagree with the valuation, rules of origin or classification methods applied to certain products. Any such disagreement could result in the retroactive assessment of additional duties with interest, the imposition of penalties, or other enforcement actions without the ability to mitigate such penalties, thereby adversely affecting our operations or financial results. Furthermore, certain of our competitors may be better positioned than us to withstand or react to border taxes, tariffs or other restrictions on global trade and as a result, we may lose market share to such competitors. Due to broad uncertainty regarding the timing, content and extent of any regulatory changes in the U.S. or abroad, we cannot predict with certainty the impact, if any, that these changes could have to our business, financial condition and results of operations.
Current wording
It remains uncertain which countries or products may be subject to possible additional tariffs which may be levied in the future, and how they may be applied in relation to the other existing tariffs. We also face uncertainty in the interpretation of new and existing tariffs and their applicability, including with respect to customs valuation, product classification and country-of-origin determinations. Although we and our suppliers seek to comply with applicable customs laws and regulations, the application of rules regarding new tariffs can be subject to varying interpretations or future re-interpretations. It is possible that U.S. or other relevant authorities could, upon review or audit, disagree with the valuation, rules of origin or classification methods applied to certain products. Any such disagreement could result in the retroactive assessment of additional duties with interest, the imposition of penalties, or other enforcement actions without the ability to mitigate such penalties, thereby adversely affecting our operations or financial results. Furthermore, certain of our competitors may be better positioned than us to withstand or react to border taxes, tariffs or other restrictions on global trade and as a result, we may lose market share to such competitors. Due to broad uncertainty regarding the timing, content and extent of any regulatory changes in the U.S. or abroad, we cannot predict with certainty the impact, if any, that these changes could have to our business, financial condition and results of operations.
Previous wording
We experienced operational issues with our agreement to supply cedar fencing to one of our larger consignment customers during fiscal 2025. After a major customer lost their primary source of western red cedar fencing in 2023, we entered into a consignment program with this customer. This program provided them with a ready source of cedar fencing and provided us with a steadier flow of orders that stabilized the year-over-year lumber sale fluctuations that we commonly experienced as a secondary supplier to multiple big box retailers. However, under this agreement, we were required to have a higher level of fencing inventory on hand than we had previously. During the Spring of 2025, we failed to acquire an adequate supply of fencing to meet our actual demand and were unable to fulfill all our customers’ orders during the third quarter. To ensure we could meet their needs for the remainder of the busy summer season, we quickly moved to secure additional Western Red Cedar from our supply partners to meet their forecasted level of sales for the remainder of the summer season. Unfortunately, much of the additional cedar fencing inventory was not needed as our customer’s actual level of fencing sales fell short of their forecasts as consumers restrained their elective purchases due to the price volatility in these markets, Therefore, we ended the 2025 fencing season with substantial excess cedar fencing inventory on hand. In November 2025 this customer informed us of their intention to transition away from the consignment agreement in calendar year 2026. Although the consignment program provided us with meaningful revenue, it eroded the margin, profitability, and pricing flexibility we were accustomed toin our cedar sales prior to this consignment arrangement. Due the consignment customer’s fencing sales falling short of their forecasts and the subsequent sudden cancelation of the consignment agreement, we still hold significant excess fencing inventory. Although we are actively seeking customers for this inventory, the peak fencing season has passed, and during the first quarter we recorded an inventory write-down to reflectour current expectations for being able to sell this inventory through alternative sales channels. The write-down supports our efforts to focus on our successful fencing and pet products going forward.
Current wording
In November 2025, we received notice from one of our largest fencing customers that they would be terminating our cedar fencing supply agreement in calendar 2026. We originally entered into a consignment agreement with this customer in 2023 after they lost their primary source of Western Red Cedar fencing. This program provided them with a ready source of cedar fencing and provided us with a steadier flow of orders that stabilized the year-over-year lumber sale fluctuations that we commonly experienced as a secondary supplier to multiple big box retailers. However, under the agreement, we were required to maintain a higher level of fencing inventory on hand than we had previously in order to quickly meet all the potential demand under the customer’s sales forecasts. During the Spring of 2025, we failed to acquire an adequate supply of fencing to meet our actual demand and were unable to fulfill all our customers’ orders during the third quarter. To ensure we could meet their needs for the remainder of the busy summer season, we quickly moved to secure additional Western Red Cedar from our supply partners to meet their forecasted level of sales for the remainder of the summer season. Unfortunately, this customer’s actual level of fencing sales for the remainder of the season fell short of their forecasts. Volatility in lumber markets during this period resulted in higher prices which led to consumers restraining their elective purchases. As a result, we ended the 2025 fencing season with excess cedar fencing inventory on hand.
Previous wording
The new tariffs were announced and became effective very quickly. We were required to pay these tariffs immediately upon effectiveness, but it has been difficult to pass on these higher costs to our customers in the form of price increases for our affected products. Our customers must consent to any price increases, and although we negotiate with our customers to accept higher prices, they may not immediately accept these increases, and any changes may only be accepted after 30 to 90 days, or longer, if at all. Many of our customers did not immediately accept higher prices for our products, but by September 2025, those remaining customers agreed to accept shipments with the higher prices which were implemented in the following weeks. However, the volume of these shipments remain significantly lower than in prior years, which also has negatively affected our revenues. Due to the uncertainty around tariff changes, some of our customers have resisted placing long-term purchases at contracted prices. Although our customers have slowly begun to accept higher product prices, consumers have not yet fully adjusted their expectations. This continues to restrain consumer’s elective purchases, including home improvement and pet products, which lessens demand in the near-term. It is highly probable these increased tariff related costs and their effects will continue to negatively affect our margins and demand for our products for the remainder of fiscal 2026.
Current wording
The implementation of the new tariffs also placed a strain on our capital position beginning in March 2025. The new tariffs became effective almost immediately after they were first announced. That gave us very little time to adjust to the higher costs, and we were required to pay these tariffs immediately upon effectiveness. This increased our cash outlays which we were not able to immediately recoup in the form of higher sales prices for the affected goods. Our customers must consent to any price increases, and although we negotiate with our customers to accept higher prices, they may not immediately accept these increases, and any changes may only be accepted after 30 to 90 days, or longer, if at all. Many of our customers did not immediately accept higher prices for our products, but by September 2025, those remaining customers agreed to accept shipments with the higher prices which began during the following weeks. However, the volume of these shipments was significantly lower than in prior years, and that trend continued in the second quarter. Due to the uncertainty around tariff changes, some of our customers have resisted placing long-term purchases at contracted prices which has further negatively affected our revenue. Although our customers have slowly begun to accept higher product prices, consumers have not yet fully adjusted their expectations. Consumer confidence has declined, and they continue to resist paying the higher product prices which restrains their elective purchases. It is highly probable these increased tariff related costs and their effects will continue to negatively affect our margins and demand for our products for the remainder of fiscal 2026.
Previous wording
Sales at Greenwood rose by 45% compared to the first quarter of fiscal 2025 with improved sales margins due to new product pricing. Demand for transit related products are continuing to recover from the lows experienced during the pandemic, and the seat shortage that occurred in fiscal 2025 that slowed transit construction has been resolved. We also have ramped up sales to a new industrial non-transit customer as we continue our efforts to acquire new customers and expand our offerings in non-transit markets. However, as we intend to concentrate our operations on the fence and outdoor segment, we are evaluating strategic alternatives for Greenwood and its industrial wood operations.
Current wording
Greenwood revenues increased by 37% compared to the first six months of fiscal 2025. Demand for transit related products continues to recover from the post-pandemic lows, and the seat shortage that slowed transit construction in fiscal 2025 has been resolved. Our sales have also risen due to a recently added non-transit industrial customer and new product pricing. We will continue to focus on acquiring new customers and expanding our offerings, particularly in non-transit markets. However, as we intend to concentrate our operations on the fence and outdoor segment, we are evaluating strategic alternatives for Greenwood and its industrial wood operations.
Previous wording
We are also actively reducing our operating and administrative costs and selling surplus assets to better align with our anticipated revenue levels. The reduction in our work force that we conducted in fiscal 2025 resulted in a 26% reduction in our wages and employee expenses in the current quarter compared to the first quarter of fiscal 2025 without compromising quality or service. Our surplus Jewett-Cameron Seed property of 11.6 acres of land and 109,500 square feet of buildings in Hillsboro remains listed for sale at a price of $7.223 million. We have also recently listed for sale our innovation studio property which is now surplus to our current needs, as we have moved the operations formerly housed in the building to our nearby headquarters and warehouse in North Plains. This property contains a renovated building of 2,000 square feet of flex space and is listed for $795,000. For both the JCSC and innovation studio properties, these are the current asking prices and there is no guarantee the properties will sell for this amount, if at all.
Current wording
We are continuing our efforts to reduce our operating and administrative costs to match our anticipated future revenue levels. Due to our work force reduction in fiscal 2025, our wages and employee expenses were 23% lower in the current six-month period compared to the first six months of fiscal 2025 while not compromising our levels of quality or service. We also continue our efforts to sell surplus assets, including our surplus Jewett-Cameron Seed property and our innovation studio property, both of which remain on the market for sale at listing prices of $7.223 million and $795,000, respectively. For both properties, these are the current asking prices and there is no guarantee the properties will sell for this amount, if at all.
Previous wording
During the first quarter in October 2025, we experienced a cybersecurity incident as a threat actor gained unauthorized access to portions of the Company’s information technology (“IT”) environment. We immediately activated our cyber incident response process to contain the intrusion, assess and investigate the incident, and implemented remedial measures, including retaining external cybersecurity experts and notifying law enforcement. Based on our investigation, we believe the cybersecurity incident consisted of unauthorized access and deployment of encryption and monitoring software by a third party to a portion of the Company’s internal corporate IT systems. We believe the unauthorized activity was contained and our IT systems and individual computer devices were brought back online, and we implemented additional cybersecurity measures. The incident caused disruptions and limitation of access to portions of our business applications, which affected our ability to process and ship orders for several weeks. We believe that the costs associated with these activities will not be material and that the costs related to the services provided by experts and the disruption to our business will be largely covered by the Company’s insurance policies, although there can be no assurance that the insurance carriers will accept liability for these costs, in which eventour costs would increase and have a material adverse effect on our future financial performance in the period in which we are required to absorb these costs.
Current wording
There has been no further incidents related to the cybersecurity intrusion we experienced in October 2025. A threat actor gained unauthorized access to portions of the Company’s information technology (“IT”) environment. We immediately activated our cyber incident response process to contain the intrusion, assess and investigate the incident, and implemented remedial measures, including retaining external cybersecurity experts and notifying law enforcement. We believe the unauthorized activity was contained and our IT systems and individual computer devices were brought back online, and we implemented additional cybersecurity measures. The incident caused disruptions and limitation of access to portions of our business applications, which affected our ability to process and ship orders for several weeks. We believe that our direct costs associated with these activities are not material as the costs related to the services provided by experts and the disruption to our business have largely been covered by the Company’s insurance policies.
Previous wording
As of November 30, 2025, we had borrowed $4,233,236 against our credit line with Northrim Funding Services (“Northrim”). Under the current terms of the agreement, Northrim provides short-term operating capital by either purchasing the Company’s accounts receivable invoices or as a loan against our inventory position. In December 2025, subsequent to the end of the first quarter, we entered into a revised agreement with Northrim to increase our borrowing capacity under the line. Under the revised agreement, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line and thereafter the funding arrangement will revert to the original conditions and limits set forth prior to the recent amendments. The increase in our line provides us with additional flexibility to provide funds to help our operational realignment and the purchase of inventory ahead of our traditionally busier Spring and Summer seasons.
Current wording
In December 2025 we successfully negotiated a revised borrowing agreement with Northrim Funding Services (“Northrim”). Under the new terms, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line and thereafter the funding arrangement will revert to the original conditions and limits set forth prior to the recent amendments. The increase in our line provides us with additional flexibility to provide funds to help our operational realignment and the purchase of inventory ahead of our traditionally busier Spring and Summer seasons. In addition to the revised credit line with Northrim, we are currently evaluating other strategies to strengthen our liquidity position. These strategies may include, but are not limited to, disposition of certain non-core assets and unused real property and seeking additional financing from both the public and private markets through the issuance of equity or debt securities. There can be no assurance that we will be successful in achieving these strategies.
Previous wording
Our strategic plan for the remainder of fiscal 2026 is to concentrate our resources on our successful fencing and pet product lines while monetizing non-core assets and disposing of excess inventory. Management and the Board are also evaluating strategic alternatives for the Company as well as its individual operating segments and assets that prioritize the Company’s overall value. We are also reducing our costs, including refining our development efforts to concentrate on improving our existing products, both in design and packaging, that can potentially provide market advantages. Due to the continued uncertainty and higher costs stemming from the high global tariff levels, we expect fiscal 2026 to remain challenging. We will continue to focus on our operational strengths while reducing costs where possible in our efforts to increase our sales and margins and return to profitability.
Current wording
We are continuing the implementation of our strategic plan to concentrate our resources on our successful fencing and pet product lines while monetizing non-core assets, including the disposal of excess inventory. Our focus remains on reinforcing our operational strengths while reducing costs where possible in our efforts to increase our sales and margins and return to profitability. Management and the Board have engaged consultants that augment our efforts to return the Company to profitability. These outside professionals have been very constructive in helping us navigate our recent challenges and refining our strategic plan. We expect we will continue to engage such services for the remainder of the fiscal year as we proceed with implementation of our plan.
Previous wording
Three Months Ended November 30, 2025 and 2024
Current wording
Three Months Ended February 28, 2026 and Three Months Ended February 28, 2025
Previous wording
JC USA is the holding company for the wholly-owned operating subsidiaries. For the quarter ended November 30, 2025, JC USA had an operating loss of ($145,887) compared to operating income of $108,720 for the quarter ended November 30, 2024. The results of JC USA are eliminated on consolidation.
Current wording
JC USA is a holding company for the wholly-owned operating subsidiaries, and thus the overall results of JC USA are eliminated on consolidation. For the quarter ended February 28, 2026, JC USA had an operating loss of ($602,446) compared to an operating profit of $97,078 for the quarter ended February 28, 2025.
Previous wording
The loss before income taxes was for the quarter ended November 30, 2025 was ($3,913,764) compared to a loss of ($835,347) for the quarter ended November 30, 2024. Income tax expense in the current quarter was ($30,375) compared to recovery of $176,630 in the prior year’s quarter. The Company estimates income tax expense for the quarter based on combined federal and state rates that are currently in effect.
Current wording
Income tax recovery for the three-month period ended February 28, 2026 was $359 compared to recovery of $187,991 in the three months ended February 28, 2025. The Company estimates income tax expense for the quarter based on combined federal and state rates that are currently in effect.
Previous wording
The net loss for the quarter ended November 30, 2025 was ($3,944,139), or ($1.12) per share, compared to a net loss of ($658,717), or ($0.19) per share, for the quarter ended November 30, 2024.
Current wording
Net loss for the quarter ended February 28, 2026 was ($1,248,928), or ($0.35) per basic and diluted share, compared to a net loss of ($573,094), or ($0.16) per basic and diluted share, for the quarter ended February 28, 2025.
Previous wording
As of November 30, 2025, the Company had working capital of $13,636,039 compared to working capital of $17,026,472 as of August 31, 2025, a decrease of $3,390,433.
Current wording
As of February 28, 2026, the Company had working capital of $12,450,122 compared to working capital of $17,026,472 as of August 31, 2025, a decrease of $4,576,350.
Previous wording
Cash and cash equivalents totaled $1,036,218, an increase of $810,005 from cash of $226,213 as of August 31, 2025. The increase was due to the timing of collection of accounts receivable, which declined to $3,313,266 from $3,863,678, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $1,109,415 from $1,000,439. Inventory declined by $2,358,777 to $13,526,812 from $15,885,589 as we began liquidating our older pet inventory, and we wrote-down our older inventory by $2,208,813. Prepaid income taxes declined to $157,276 from $180,151.
Current wording
Cash and cash equivalents totaled $546,614, an increase of $320,401 from cash of $226,213 as of August 31, 2025. The increase was due to the timing of collection of accounts receivable, which increased to $6,518,143 from $3,863,678, and prepaid expenses, which are largely related to down payments for future inventory purchases, which increased to $1,012,351 from $1,000,439. Inventory declined by $6,289,713, or 40%, to $9,595,876 from $15,885,589 as we sold most of our excess cedar fencing and liquidated certain of our older pet inventory. Prepaid income taxes declined to $167,401 from $180,151.
Previous wording
Current liabilities rose to $6,408,759 from $4,695,620 as bank indebtedness increased to $4,233,236 from $2,101,835. Accounts payable declined to $1,204,550 from $1,510,173, and accrued liabilities fell to $970,973 from $1,083,612.
Current wording
Current liabilities rose to $6,292,074 from $4,695,620 as bank indebtedness increased to $4,275,261 from $2,101,835. Accounts payable declined to $963,050 from $1,510,173, and accrued liabilities fell slightly to $1,053,763 from $1,083,612.
Previous wording
As of November 30, 2025, accounts receivable and inventory represented 84% of current assets and 72% of total assets compared to 91% of current assets and 78% of total assets as of August 31, 2025.
Current wording
As of February 28, 2026, accounts receivable and inventory represented 86% of current assets and 74% of total assets compared to 91% of current assets and 78% of total assets as of August 31, 2025.
Previous wording
For the three months ended November 30, 2025, the accounts receivable collection period, or DSO, was 35 days compared to 41 days for the three months ended November 30, 2024. Inventory turnover to the three months ended November 30, 2025 was 166 days compared to 160 days for the three months ended November 30, 2024.
Current wording
For the three months ended February 28, 2026, the accounts receivable collection period, or DSO, was 56 compared to 55 for the three months ended February 28, 2025. For the six-month period ended February 28, 2026, the DSO was 61 compared to 55 for the six months ended February 28, 2025. Inventory turnover for the three months ended February 28, 2026 was 117 days compared to 175 days for the three months ended February 28, 2025. For the six months ended February 28, 2026, inventory turnover was 124 days compared to 172 days for the six months ended February 28, 2025.
Previous wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we originally established in fiscal 2024. Under the terms of the agreement, Northrim will provide short-term operating capital by either purchasing the Company’s accounts receivable invoices (“AR invoices”) or as a loan against our inventory position. Subsequent to the end of the quarter, we completed a revised borrowing agreement with Northrim. Under the revised agreement, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line. Interest is computed at the prime rate plus 4.75% with floor of 11% and is secured by certain or our assets. The line expires on June 30, 2026. As of November 30, 2025, we have borrowed $4,233,236 against the line at a current interest rate of 11.5%.
Current wording
External sources of liquidity include an asset-based line of credit agreement with Northrim Funding Services (“Northrim”) which we originally established in fiscal 2024. Under the terms of the agreement, Northrim will provide short-term operating capital by either purchasing the Company’s accounts receivable invoices (“AR invoices”) or as a loan against our inventory position. Subsequent to the end of the quarter, we completed a revised borrowing agreement with Northrim. Under the revised agreement, the maximum amount of AR invoices Northrim will purchase at one time is limited to an amount equal to 90% of the maximum eligible accounts and is not to exceed $8,000,000, which was increased from the prior 80% of the net eligible accounts and a $6,000,000 limit. Borrowing against the Company’s inventory was increased to an amount equal to 50% of all eligible inventory from the prior 25%, and the maximum amount the Company may borrow was increased to $6,500,000 from $4,000,000. Amounts provided by Northrim will be secured by certain of the Company’s real estate assets. Proceeds from the sale of any such assets will be used to pay down the credit line. Interest is computed at the prime rate plus 4.75% with floor of 11% and is secured by certain or our assets. The line expires on June 30, 2026. As of February 28, 2026, we have borrowed $4,275,261 against the line at a current interest rate of 11.5%.
Previous wording
The increases in interest rates as a result of the higher level of inflation in the US economy experienced beginning in calendar 2021 and continuing through fiscal 2025 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit. The interest rate on our current line of credit is computed using the Prime Interest Rate, which has risen from 3.25% in January 2022 to approximately 7.50% in August 2025. In March 2025, the Company began drawing against its asset-based line of credit to fund its usual seasonal build of inventory to meet its anticipated needs for the busier Spring and Summer seasons. As of the end of the fiscal quarter ended November 30, 2025, the Company has drawn $4,233,236 against this line of credit at a current interest rate of 11.5%.
Current wording
The increases in interest rates as a result of the higher level of inflation in the US economy experienced beginning in calendar 2021 and continuing through fiscal 2025 has also had a negative effect on our interest expense charged on any borrowing on our lines of credit. The interest rate on our current line of credit is computed using the Prime Interest Rate, which has risen from 3.25% in January 2022 to approximately 7.50% in August 2025. In March 2025, the Company began drawing against its asset-based line of credit to fund its usual seasonal build of inventory to meet its anticipated needs for the busier Spring and Summer seasons. As of the end of the most recent fiscal period ended February 28, 2026, the Company has drawn $4,275,261 against this line of credit at a current interest rate of 11.5%.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Although the consignment program provided us with meaningful revenue, it eroded the margin, profitability, and pricing flexibility we were accustomed toin our cedar sales prior to this consignment arrangement. This consignment sales agreement accounted for the majority of our lumber fencing sales, but we are continuing to offer cedar fencing as we have other current customers for these products.
Current report — wording carried from elsewhere
JC USA, the holding company that provides professional and administrative services for the wholly-owned operating subsidiaries had operating loss of ($748,333) compared to operating income of $205,798 for the six months ended February 28, 2025. The results of JC USA are eliminated on consolidation.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
In addition to the revised credit line with Northrim, we are currently evaluating other strategies to strengthen our liquidity position. These strategies may include, but are not limited to, disposition of certain non-core assets and unused real property, and seeking additional financing from both the public and private markets through the issuance of equity or debt securities. There can be no assurance that we will be successful in achieving these strategies. See “Management’s Discussion and Analysis – Liquidity and Capital Resources” for additional information.