Conifex Timber (CFF) investor relations material

Executive summary

• Q2 2026 net loss was CAD 9.5 million (CAD 0.23 per share), similar to Q1 2026 and higher than Q2 2025; EBITDA loss improved to CAD 6.3 million from CAD 7.7 million in Q1 2026.

• Sawmill operations were curtailed from May 2026 due to sawlog shortages and market conditions, impacting production and sales.

• The year is transitional, with curtailments in single shift operations to preserve cash amid high duties and low lumber prices.

• Resumption of full operations in the second half of 2026 depends on securing additional funding, aiming for two-shift steady state before year-end.

Financial highlights

• Lumber revenues were $19.0 million, up 27% sequentially but down 31% year-over-year; bioenergy revenues were $2.8 million, down from $5.2 million in Q1 2026.

• Cost of goods sold decreased 10% sequentially and 26% year-over-year, reflecting lower production volumes.

• Duty deposits expensed were $3.7 million, up from $3.0 million in Q1 2026.

• Lumber production in H1 2026 was 35.8 million board feet, with a capacity utilization rate of about 30%.

• Finance costs rose to $3.1 million, reflecting higher debt levels and new loans.

Outlook and guidance

• Targeting resumption of two-shift operations and positive EBITDA by end of 2026, contingent on additional financing.

• Expectation of EBITDA positive operations in 2027, based on analyst consensus SPF prices and lower duty rates.

• Market conditions for Canadian softwood lumber expected to remain challenging through 2026 due to macroeconomic uncertainty and trade dynamics.

• Final results of the AR7 trade review expected in Q4 2026, with potential financial impacts.

• Mid- and long-term supply/demand fundamentals for SPF remain strong, with improved pricing expected.