Western Forest Products Inc. · TSX:WEF
Western Forest Products — CIBC World Markets 2006 Whistler Institutional Investor Conference
16 slides from Western Forest Products's conference presentation, 2006
Slide 1: Western Forest Products – CIBC World Markets 2006 Whistler Institutional Investor Conference
Western Forest Products Target Future State… Injury free operations… Sustainable forest management… A profitable coastal lumber business… CIBC CIBCWorld WorldMarkets Markets 2006 2006Whistler Whistler Institutional InstitutionalInvestor Investor Conference Conference 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation includes statements that may constitute forward-looking statements, including statements regarding the anticipated timing and benefits of the acquisitions by Western Forest Products of Cascadia Forest Products and TFL 37. Forward-looking statements, which
Slide 3: Profile
Profile Western Forest Products (“WFP”) is located on the coast of British Columbia, providing high quality lumber to over 20 countries worldwide. The Company is currently leading a restructuring of the coastal lumber sector through its acquisition of Cascadia Forest Products Ltd. (“Cascadia”) and C
Slide 4: Profile: Current Tenures and Facilities
Profile Current Tenures and Facilities 4
Slide 5: Strategy
Strategy Our objective is to create superior value for shareholders by building a margin focused lumber business located on the coast of British Columbia of sufficient size and scale to compete in global softwood markets. Key elements of this strategy include: KEY ELEMENTS IMPLICATIONS Owning the ri
Slide 6: Optimal Configuration
Optimal Configuration As we developed our strategy, we identified an optimum fibre basket configuration and implemented a strategy to acquire these core TFL’s in a multi-step strategy. The most attractive opportunities were Cascadia’s Tenures and Canfor’s TFL 37. With the acquisitions of Cascadia an
Slide 7: Coastal Tenure Holders
Coastal Tenure Holders SMITH SOUND ce be Caution iso CAPE SCOTT PARK Gane scary Montasy n Har sowibs TatlayoiKo Lake Sy COURTENAY P “COMOX CUMBERLAND TOFINO 5 4 hi, ucLUELET Coastal TFL Holders. MN Canfor ME Timberwest HJ Cascadia BB Interfor HE Teal Jones (NN Western EE NW Squamish | lisaak -TSYLO8
Slide 8: Western Optimal Configuration: The New Western
Western Optimal Configuration The New Western 8
Slide 9: Cascadia Profile
Cascadia Profile In November, 2005 WFP announced the acquisition of Cascadia Forest Products, the former coastal lumber business owned by Weyerhaeuser. Consideration to be paid is $120 million plus net working capital. Timberlands • Annual allowable timber harvest (AAC) of 3.6 million m3 from regula
Slide 10: Cascadia Rationale
Cascadia Rationale Margin Focused Business Opportunity • Cascadia has superior expertise in wood products marketing and sales that has consistently achieved higher realizations from a similar fibre basket but lower EBITDA margins due to higher cost converting facilities. Fibre Basket 2004 Lumber 200
Slide 11: Cascadia Rationale
Cascadia Rationale A combined Cascadia and WFP is expected to create a low cost, margin focused lumber producer with rights to high quality crown coastal timberlands. The combined operations should be positioned to compete in global softwood markets, especially cedar. • 6.8 million m3 of AAC Signifi
Slide 12: Cascadia Rationale: Annual Capacity
Cascadia Rationale The acquisition of Cascadia positions Western within the largest producers in North America with sufficient scale to pursue additional opportunities. North American Lumber Producers 8,000 Annual Capacity (mmfbm) 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 WFP Proforma WFP Pope & T
Slide 13: Cascadia Acquisition Financing
Cascadia Acquisition Financing Financing of the transaction has been secured from Tricap Restructuring Fund to close both the acquisition of Cascadia and to refinance WFP’s existing 15% senior secured bonds. Sources and Uses (C$ millions) ¹ Sources of Funding Uses of Funding Bridge Facility $ 303 Re
Slide 14: Capital Structure
Capital Structure The new combined entity will have a stronger capital structure. Western Forest Products (C$ millions) Stand Alone Proforma As at September 30, 2005 Acquisition Cash & Restricted Cash $ 52 $ 17 WC Facility Drawdown $ 72 $ - 15% Sr. Sec. Bonds due 2009 247 - Bridge Financing - 304 To
Slide 15: Acquisition of Englewood Logging Division
Acquisition of Englewood Logging Division In December, 2005 WFP announced the acquisition of the Englewood Logging division including 945,000 m3 annual harvest on crown timberlands and related assets (TFL 37) from Canfor. In addition, WFP will receive $35 million in cash as part of a new long term f
Slide 16: Key Investment Highlights
Key Investment Highlights Post closing of these transactions, Western Forest Products will be re- positioned as the largest lumber company on the coast of British Columbia with the necessary size and scope to better compete in global softwood markets. 80% of current harvest will be older, higher val
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