Slide 1: Q3 2023 Financial Results
Q3 2023 FINANCIAL RESULTS November 9, 2023
Slide 2: Disclaimer
DISCLAIMER FORWARD-LOOKING STATEMENT Certain statements in this presentation, including statements regarding future results and performance, are forward-looking statements within the meaning of securities legislation based on current expectations. The accuracy of such statements is subject to a numb
Slide 3: Overview of Consolidated Profitability Drivers
OVERVIEW OF CONSOLIDATED PROFITABILITY DRIVERS Consolidated EBITDA (A)1 Year-to-Date Variation Quarter-over-Quarter Year-over-Year 2023 vs 2022 (in millions of Canadian dollars) Q3 2023 vs Q2 2023 Q3 2023 vs Q3 2022 (nine months) Pricing ($12 million) ($39 million) $56 million Freight & Production C
Slide 4: Summary of Quarterly Financial Results & KPIs
SUMMARY OF QUARTERLY FINANCIAL RESULTS & KPIs 2021 2022 2023 (In millions of CAN$, except per common 3 share amounts, where noted) Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 YTD LTM4 Financial Results Sales 942 956 1,030 1,028 3,956 1,038 1,119 1,174 1,135 4,466 1,134 1,168 1,198 3,500 4,635 Operati
Slide 5: Recycled Fibre Costs - Index List Prices
RECYCLED FIBRE COSTS - INDEX LIST PRICES ($ US/s.t.) Current OCC: 300 (Oct-23) • Consistent domestic demand with fibre generation following 275 normal seasonal generation levels, but at a slightly slower 250 pace than recent years 225 200 • Increased export volumes to Asia have added pressure on 175
Slide 6: Virgin Pulp Costs - Index List Prices
VIRGIN PULP COSTS - INDEX LIST PRICES ($ US/metric ton) VIRGIN PULP: Current (Oct-23) • Sequential improvement with price decreases until 1,800 late Q3; index prices also lower YoY 1,600 • Market conditions have started to reverse, however, 1,400 with rebound in demand from Asia and multiple mill 1,
Slide 7: Packaging Products / Containerboard
PACKAGING PRODUCTS / CONTAINERBOARD Comments on sequential performance Results Change vs. Q3 2023 Q2 2023 Q3 2022 è Total shipments increased by 8% sequentially. Shipments of parent rolls increased by 12% and those of converted products increased by 4% compared to the second quarter. The sequential
Slide 8: Packaging Products / Containerboard
PACKAGING PRODUCTS / CONTAINERBOARD Quarterly EBITDA (A)1 (M CAN$) è Sequential Q3 shipments of converted products: 17% 21% 22% 17% 17% Canada +4.3% (vs. market +0.4%); US +1.0% (vs. market +0.4%) è Year-over-year Q3 shipments of converted products: 119 126 Canada +5.7% (vs. market +0.8%); US +9.5%
Slide 9: Packaging Products / Specialty Products
PACKAGING PRODUCTS / SPECIALTY PRODUCTS Results Change vs. Comments on sequential performance Q3 2023 Q2 2023 Q3 2022 Sales (M$) è Sales decreased by 4% sequentially. This reflects lower volume in our Cardboard 157 (4)% (7)% and Moulded Pulp sub-segments. EBITDA (A)1 (M$) 21 (13)% (16)% 1 è EBITDA (
Slide 10: Packaging Products / Specialty Products
PACKAGING PRODUCTS / SPECIALTY PRODUCTS Quarterly EBITDA (A)1 (M CAN$) 15% 12% 17% 15% 13% è Cardboard: results remained stable sequentially with the impacts of lower volume and higher raw material costs being 27 mitigated by lower maintenance and operation sequentially. 25 24 20 21 è Moulded pulp:
Slide 11: Tissue Papers
TISSUE PAPERS Results Change vs. Comments on sequential performance Q3 2023 Q2 2023 Q3 2022 è Shipments were stable on a sequential basis. This reflects the combined impact of a 5% Shipments (’000 s.t.) increase converted products shipments, and lower parent rolls shipments (-24%), the latter 134 —%
Slide 12: Tissue Papers
TISSUE PAPERS Quarterly EBITDA (A)1 (M CAN$) è Good demand for Retail tissue products (shipments +8.6% YoY, 11% 14% +6.2% QoQ), while demand levels for Away-from-Home tissue 1% 2% 4% products improved sequentially but were below last year 61 (shipments -2.3% YoY, +3.9% QoQ). 44 16 è Repositioning of
Slide 13: Q3 2023 EBITDA (A) to Operating Income Reconciliation
Q3 2023 EBITDA (A)1 TO OPERATING INCOME RECONCILIATION (M CAN$) 200 161 160 120 80 80 (69) (7) (4) (1) 40 0 1 EBITDA (A) Depr. & Impairment Restructuring Gain on acq., Operating income Amort. charges costs disp. and others Corporate, Recovery and Container- Specialty Tissue Recycling (M CAN$) board
Slide 14: Net Earnings - As Reported vs Adjusted
NET EARNINGS - As reported vs adjusted2 NET EARNINGS NET EARNINGS PER COMMON SHARE1 (In millions of Canadian dollars, except per common share amounts) Q3 2023 Q3 2023 As reported 34 $0.34 Specific items: Impairment charges 7 $0.05 Gain on acquisitions, disposals and others 1 — Restructuring costs 4
Slide 15: Quarterly Year-over-Year Adjusted EPS Variance
QUARTERLY YEAR-OVER-YEAR ADJUSTED EPS VARIANCE1,2 0.80 0.36 0.02 0.60 (0.01) (0.01) (0.02) 0.44 0.40 (0.10) 0.34 $ cents (0.10) 0.22 0.20 0.20 0.00 (0.02) -0.20 2 2 2 EPS reported Specific Adjusted EPS EBITDA (A) Income tax Non- Share of Depreciation Financing Adjusted EPS Specific EPS reported Q3 2
Slide 16: Quarterly Sequential Adjusted EPS Variance
QUARTERLY SEQUENTIAL ADJUSTED EPS VARIANCE1,2 0.50 0.06 0.44 0.14 (0.01) (0.01) (0.01) 0.40 0.34 (0.10) 0.30 0.05 0.27 $ cents 0.22 0.20 0.10 0.00 2 2 2 EPS reported Specific Adjusted EPS EBITDA (A) Income Depreciation Share of Financing Adjusted EPS Specific EPS reported Q2 2023 items Q2 2023 tax &
Slide 17: Cash Flow Overview
CASH FLOW OVERVIEW 2021 2022 2023 (In millions of CAN$, except per common share amounts) Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 YTD4 LTM5 Cash flow from operations 82 87 58 20 247 19 81 60 100 260 89 117 109 315 415 Specific items1 4 2 12 31 49 7 — 2 3 12 1 5 6 12 15 Adjusted cash flow from oper
Slide 18: New Capital Investments
NEW CAPITAL INVESTMENTS (in millions of Canadian dollars, excluding new leases, disposal of assets and accounts payable variation) 532 36 2023F CAPEX: ~ 41 $325 M1 29 312 330 325 26 27 50 81 227 213 229 37 39 22 426 20 169 20 16 22 24 85 104 61 217 184 22 171 22 18 62 66 84 2017 2018 2019 2020 2021
Slide 19: Net Debt Reconciliation - Q3 2023
NET DEBT1 RECONCILIATION - Q3 2023 (M CAN$) 2,100 59 2,088 2,076 47 2,000 36 11 (109) 2 (31) (3) 1,900 1 1 Net debt as of Cash flow Changes in non- Proceeds from Investments Right-of-use Dividends paid & F/X CAN$ Payments for Net debt as of June 30, 2023 from oper. cash disposals of and others asset
Slide 20: Consolidated Financial Ratios & Debt Maturities
CONSOLIDATED FINANCIAL RATIOS & DEBT MATURITIES Net Debt / EBITDA (A)1,3 Interest Coverage Ratio2,3 6.7x 5.2x 5.8x 6.0x 4.7x 4.0x 3.8x 3.6x 3.5x 4.7x 4.6x 4.3x 4.6x 4.9x 4.9x 3.25x 3.5x 3.8x 3.4x 2.5x 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q3 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q3 202
Slide 21: Near Term Factors
NEAR TERM FACTORS • Containerboard: Sequential performance forecast to decrease, reflecting higher raw material costs, lower average selling price vs Q3 2023 vs Q4 2022 and usual seasonal softer volume; YoY results also expected to Q4 20231 decrease due to higher raw material costs, lower average se
Slide 22: Appendix
APPENDIX 22
Slide 23: Year-over-Year Sales Reconciliation
YEAR-OVER-YEAR SALES RECONCILIATION +2% (M CAN$) 1,300 20 — 46 (3) 1,198 1,200 1,174 (39) 1,100 Recovery & Sales Recycling & Sales (M CAN$) Q3 2022 Volume F/X CAN$ Mix Other items Price Q3 2023 Containerboard 595 58 10 (9) — (61) 593 Specialty Products 168 (12) 3 — — (2) 157 Tissue Papers 382 — 7 9
Slide 24: Year-over-Year EBITDA (A) Reconciliation
YEAR-OVER-YEAR EBITDA (A)1 RECONCILIATION + Higher volume and more favourable mix and FX + Higher selling prices, more favourable + Lower cost from Corporate activities + Lower raw material, logistics and energy costs volume/mix - Higher production costs raw material, logistics and - Lower results f
Slide 25: Sequential Sales Reconciliation
SEQUENTIAL SALES RECONCILIATION (M CAN$) +3% 38 4 1,198 1,200 1,168 (12) 1,100 1,000 Sales Sales (M CAN$) Q2 2023 Volume Mix Price Q3 2023 Containerboard 562 45 (9) (5) 593 Specialty Products 164 (7) — — 157 Tissue Papers 416 — 13 (7) 422 Corporate, Recovery and Recycling activities & Elim. 26 — — —
Slide 26: Sequential EBITDA (A) Reconciliation
SEQUENTIAL EBITDA (A)1 RECONCILIATION + Lower raw material, production and logistics + Higher volume and favourable margin mix costs + Lower operating costs + Favourable mix - Lower selling prices - Lower realized spreads - Lower selling price - Higher raw material costs - Lower volume (M CAN$) 17 5
Slide 27: Cost of Sales and Selling and Administrative Expenses
COST OF SALES SELLING AND ADMINISTRATIVE EXPENSES (In millions of Canadian dollars) Q3 2023 Q2 2023 Q3 2022 Cost of sales Raw materials 419 396 440 Wages and benefits 192 194 171 Energy 57 58 65 Delivery 135 131 149 Other 151 162 150 Depreciation and amortization 69 68 67 1,023 1,009 1,042 Selling a
Slide 28: Selected Reference Prices
SELECTED REFERENCE PRICES Current Current Containerboard - Selected Products (US$/s.t.) Specialty Products - Selected Products (Oct-23) (US$/s.t.) (Oct-23) 1,000 1,200 1,100 900 1,000 1,020 845 800 900 800 700 715 700 600 600 Feb-21 Aug 23 Nov-20 May-23 Aug-20 Feb-23 May-20 Nov-22 Feb-20 Aug-22 Nov-
Slide 29: Selected Reference Prices and Fibre Costs
SELECTED REFERENCE PRICES AND FIBRE COSTS Q3 2023 vs. Q3 2023 vs. 2021 2022 2023 Q3 2022 Q2 2023 These indexes should only be used as an indicator of trends and they may be different than our actual selling prices or purchasing costs. Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 (units) (%) (units) (%
Slide 30: For More Information
For more information: www.cascades.com/investors Jennifer Aitken, MBA Director, Investor Relations 514-282-2697 / investor@cascades.com