Canfor Corporation Don Kayne, President and Chief Executive Officer - PowerPoint PPT Presentation

Canfor Corporation Don Kayne, President and Chief Executive Officer

Forward Looking Statements The presentation and answers to questions today contain forward-looking statements which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Factors that could have a material impact on any future oriented statements made herein include, but are not limited to: general economic, market and business conditions, product selling prices, raw material and operating costs, foreign exchange rates, interest rates, changes in law and public policy, the outcome of trade disputes, and opportunities available to or pursued by the Company. For further details on these factors and our assumptions and applicable risks and uncertainties, please refer to Canfor Corporation’s Annual Report for the year ended December 31, 2010 available at www.canfor.com or www.sedar.com.

Who We Are • Largest producer of Canadian dimension lumber • 50.2% owner of Canfor Pulp Limited Partnership • Builder of market demand in the world’s fastest -growing economies • A company with a strong reputation for quality, customer service and excellence in logistics support • Supplier of products the world wants – smart green solutions • Top performer, anchored by an exceptional balance sheet

Assets ($2.5 billion) 2011 9 months Revenues ($1.8 billion ) Lumber Lumber Pulp Pulp Panels and Other Panels and Other Key Facts • 17 sawmills in Market Capitalization (billions $) Canada and the US 3.0 • Controlling interest in 2.5 3 NBSK pulp mills 2.0 through Canfor Pulp 1.5 Limited Partnership • 16 million m3 of 1.0 annual log harvest 0.5 0.0 CFP/CFX WFT NBD TMB IFP

Green Fibre Canfor’s Fibre Customer Fibre • Strong, sustainable fibre supply Strategy Supply • Fibre base supports our customer focused strategy • Well located mills in regions minimally impacted by mountain pine beetle • Acquisition of Tembec tenure will further strengthen fibre security (75% of all Canfor fibre from committed tenure)

Focus on FORT ST JOHN ($43M) Performance CHETWYND ($23M) GRANDE PRAIRIE ($37M) • $300 million spending program to improve modernization and efficiency • Driving to top quartile margin POLAR ($21M) performance through: PG SAWMILL ($25M) • Productivity and Strategic Sawmill operational excellence • Extracting optimal value Capital from our fibre advantage • Continuing to capitalize on our high quality customer base VAVENBY ($21M) • Spending directed at mill locations with strong long- term fibre supply SOUTHERN BC MILLS ($50M+) Figures in white represent capital expenditures greater than $20M between 2010 and 2012

Customer Regions North America • The United States remains our largest market - 45% of total SPF sales in 2011 • Canada is a strong and steady market, taking almost 20% of SPF sales • We are committed to growth with our key customers • Our focus is on the retail business – first to rebound when the economy improves • Our customers are the future consolidators in a more concentrated market

Customer Regions China 1200 • Canfor aggressively building demand for Canfor Shipments to China (Mfbm) our products – China is an excellent 1000 example of our market development 800 work • Canfor was the first company into China; 600 in a decade, it has grown from obscurity into our largest offshore market 400 • Huge demand for affordable housing; 200 acute domestic fibre shortage 0 2006 2007 2008 2009 2010 2011 2012F Low Grade #2 & Better

Chinese Wood Consumption 400 Demand 350 Supply Looking forward in China 300 Shortfall (imports) millions m3 250 200 • Canada has built strong, sustainable 150 recognition of the merits of wood frame 100 construction in China 50 • Latest Chinese government White Paper 0 2010 2015 solidifies government support for Source: Wood Markets International promotion of wood use to combat Chinese Urbanization climate change 1000 70% 63% % of Urbanization 62% 60% • Opportunities for wood in multi-family 900 57% Urban 60% 800 Rural 49% and hybrid applications immense; China’s 50% 700 40% % of Urbanization Population (,000) shortfall in domestic supply represents 35% 40% 600 31% 28% 500 30% persistent opportunity for Canfor (top 23% 20% 18% 18% 400 17% 15% 20% chart) 13% 11% 300 • China has acute need for sustainable 10% 200 0% housing – in the last decade 218 million 100 0 -10% people in China moved from rural to 1950 1960 1970 1980 1990 2000 2010 2020 2030 urban centres (bottom chart) Source: United Nations

Customer Regions Japan • Canfor has had a strong relationship with Japan for more than 30 years Market Breakdown • Mature, high value market; strong cultural ties to 3% wood construction • Widespread recognition of environmental, 2x4 House 21% Construction health, seismic benefits of using wood Post and Beam • 2x4 market continues to be the backbone of our Pre-Fabrication market 76% • Hybrid market inroads (in post and beam segment), including commercial and public buildings

Conclusion • We see moderately improving demand signals in existing and emerging markets • Wood products are increasingly embraced as an environmentally preferable choice, and the need for sustainable housing continues to grow as global population expands • Canfor is well positioned to meet this demand: • High quality, secure fibre supply • Strong, low cost asset base realizing benefits of $300 million capital program and strategic acquisitions • Aggressive and proven program of building markets, recognition of our products around the world

These materials have been prepared by Management of the Company. No regulatory authority has approved or disapproved of the contents of these materials. These materials do not constitute an offer to sell or the solicitation of an offer to buy any securities of the Company and shall not constitute an offer, solicitation or sale of the Company’s securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. Securities of the Company may not be offered or sold in the United States absent their prior registration or qualification or an applicable exemption from the applicable registration or qualification requirements. Investor Contact TSX Ticker: CFP Contacts: Alan Nicholl – Senior Vice President, Finance and CFO Alan.Nicholl@canfor.com 604-661-5370 Pat Elliott - Vice-President & Treasurer Patrick.Elliott@canfor.com 604-661-5441

Capitalization and Liquidity Liquidity $ Millions Long Term Debt $ Millions Syndicated credit facility Oct 2013 350 Senior Unsecured Notes 6.33% 2012 50 Senior Unsecured Notes 5.42% 2013 75 Other credit facility Jan 2012 12 Total Debt 125 Outstanding Letters of Credit (17) Cash 70 Cash balance 70 Shareholders’ Equity 1,176 Net Liquidity 415 Net Debt to Total Capitalization 5% All amounts as at September 30, 2011 and exclude the Canfor Pulp Limited Partnership

Trading Liquidity CFP WFT IFP 500,000 Average Daily Trading Volume (Shares) 400,000 300,000 Major Shareholders* 200,000 The Pattison Group 38% 100,000 Mackenzie Cundill 14% 0 2007 2008 2009 2010 2011 Jarislowsky Fraser 11 % *Information as per public filings CFP WFT IFP 6,000,000 Average Daily Trading Value (Dollars) 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 2007 2008 2009 2010 2011