Slide 1: Acquisition of EACOM Timber
ACQUISITION OF EACOM TIMBER NOVEMBER 23, 2021 Cover Picture: EACOM’s Elk Lake, Ontario mill
Slide 2: Forward-Looking Information & Non-GAAP Measures
FORWARD-LOOKING INFORMATION & NON-GAAP MEASURES Forward-Looking Information: This presentation contains forward-looking information about Interfor Corporation’s (“Interfor” or the “Company”) business outlook, objectives, plans, strategic priorities and other information that is not historical fact.
Slide 3: Transaction Highlights
TRANSACTION HIGHLIGHTS Consistent with growth-focused strategy as a pure-play lumber producer Increases total lumber production and capacity by one billion board feet or 25% Builds upon already geographically diverse operations, adding significant scale in a new region Complements existing products,
Slide 4: Transaction Terms
TRANSACTION TERMS Item Description Transaction • Acquisition of 100% of the equity interests of EACOM Timber Corporation • 7 sawmills (5 in Ontario, 2 in Quebec), total of 985 MMbf / year of SPF capacity Key Facilities • 1 I-Joist plant, producing solid-sawn flange I-Joists • 1 value-added remanufac
Slide 5: Transformative Growth
TRANSFORMATIVE GROWTH • Transformative deal that grows Interfor's lumber capacity by 25%, builds on its geographic diversification and expands its offering of spruce-pine-fir (SPF) lumber • SPF lumber is becoming increasingly scarce in North America given ongoing declines in British Columbia’s fibre
Slide 6: Regional Diversification
REGIONAL DIVERSIFICATION • Interfor to become a truly North American lumber producer, with operations in all the key fibre regions on the continent, further diversifying and de-risking the operating platform INTERFOR & EACOM OPERATIONS Interfor Facilities EACOM Facilities EACOM TIMBER: • 7 sawmills
Slide 7: Attractive Fibre Fundamentals
ATTRACTIVE FIBRE FUNDAMENTALS • EACOM’s log costs are very attractive, second only to the US South • Residuals – stable pricing, long-standing business relationships with well capitalized pulp producers and no significant exposure to newsprint manufacturers • Responsible forest management through in
Slide 8: Expansion into Attractive Markets
EXPANSION INTO ATTRACTIVE MARKETS • Complementary geographic destinations with Interfor: • EACOM’s facilities are very well positioned to service Greater Toronto, the fourth largest metropolitan area in North America, as well as other key Great Lakes markets • Approx. 40% of EACOM’s shipments remain
Slide 9: Operations Overview
OPERATIONS OVERVIEW • 7 sawmills (5 in Ontario, 2 in Quebec), with total SPF lumber capacity of 985 MMbf / year • 1 I-Joist plant, producing branded and private-label solid-sawn flange I-Joists • 1 lumber reman plant producing components for bedframes and furring strips EAR FALLS, ON MATAGAMI, QC TI
Slide 10: Financial Performance & Value
FINANCIAL PERFORMANCE & VALUE • Purchase price of C$490 MM represents: • Pre-synergy mid-cycle EBITDA multiple of 5.4x • Post-synergy mid-cycle EBITDA multiple of 4.3x • Lumber capacity multiple of C$497/Mbf or US$398/Mbf • Synergies estimated at C$25 MM/year: • Operations, sales, logistics and admi
Slide 11: Financing & Capital Structure
FINANCING & CAPITAL STRUCTURE • Purchase price to be funded with cash on hand and available debt facilities • Very strong capital structure and available liquidity post-transaction, with significant additional credit capacity available Actual Proforma (1) C$MM Sept'21 Sept'21 Cash $509 - Debt $375 $
Slide 12: Investor Contacts
INVESTOR CONTACTS RICK POZZEBON MIKE MACKAY SVP & Chief Financial Officer VP, Corporate Development & Strategy 604-689-6804 604-689-6846 richard.pozzebon@interfor.com mike.mackay@interfor.com 12