Conifex Timber (CFF) investor relations material

Executive summary

• Q2 2025 results showed a net loss of $8.3 million and negative EBITDA of $3.2 million, mainly due to lower power production, extended maintenance shutdown, and weaker lumber prices.

• Q2 power production was 38% lower than Q1 and 22% lower than Q2 last year, with higher maintenance costs and reduced log availability impacting results.

• Revenues and EBITDA were further reduced by a 4% strengthening of the Canadian dollar against the US dollar.

• For the first half of 2025, positive EBITDA of $1.7 million was reported, despite an $800,000 foreign exchange translation loss.

• Lumber production and sales were impacted by operational adjustments and reduced log availability.

Financial highlights

• Q2 consolidated EBITDA loss of $3.2 million, with sales of $27.4M from lumber, $2.9M from by-products, and $3.6M from bioenergy.

• Cumulative US duty deposits paid total US $41.7 million (C$57 million), with $11 million in refundable overpayments shown as a long-term receivable.

• Q2 revenues were negatively affected by lower lumber prices, currency headwinds, and a 12% sequential decrease in lumber revenues.

• Cost of goods sold decreased 7% from Q1 2025 and 10% from Q2 2024.

• Available liquidity at quarter-end was $3.0M, down from $4.2M in Q1 2025 and $10.9M in Q2 2024.

Outlook and guidance

• Expectation of positive EBITDA for full year 2025, excluding one-time or nonrecurring charges, despite industry forecasts of negative EBITDA for some peers.

• North American lumber markets expected to remain volatile and uncertain for the rest of 2025, with duty deposit rate increases and tariffs posing significant challenges.

• Power plant has been operating well since July, supporting improved outlook for the remainder of the year.

• A one-time noncash charge of approximately US $8 million is expected in Q3 due to higher US duty rates.

• Plans to sustain two-shift operations through the balance of 2025.