INVESTOR PRESENTATION New York City February 26, 2015 - - PowerPoint PPT Presentation

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INVESTOR PRESENTATION New York City February 26, 2015 - - PowerPoint PPT Presentation

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INVESTOR PRESENTATION New York City February 26, 2015 Forward-Looking Statements This presentation and comments associated with it contain forward-looking statements including statements relating to U.S. housing recovery, the potential for

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INVESTOR PRESENTATION

New York City February 26, 2015

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This presentation and comments associated with it contain forward-looking statements including statements relating to U.S. housing recovery, the potential for constrained lumber supply, energy-related opportunities, earnings sensitivity and estimated annual capital expenditures. These statements are subject to the cautionary statement which introduces West Fraser’s 2014 Annual Management’s Discussion & Analysis which can be accessed on the Company website www.westfraser.com.

Forward-Looking Statements

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LUMBER

27 mills

PANELS

7 mills

PULP & PAPER

5 mills SPF 3.9 Bfbm SYP 2.3 Bfbm Total 6.2 Bfbm Plywood: 830 MMsf3/8” MDF: 300 MMsf3/4” LVL: 3.2 MMcf NBSK: 570 Mtonnes BCTMP: 650 Mtonnes Newsprint: 135 Mtonnes

Our Products

  • North America’s largest lumber producer
  • Largest plywood producer in Canada
  • Third largest pulp producer in Canada
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Lumber 66% Panels 11% Pulp & Paper 23%

Trend Sales Mix ($)

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Operations diversified by geography

Geographic diversification

B.C. 40% Alberta 23% U.S. 37%

Lumber Capacity

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Demand - North American housing

  • Chinese construction and

industrial applications

  • Japanese housing

Supply

  • Fibre limitations
  • Residual offtake
  • Mill closures
  • People

Efficiency - Capital investment

  • Business model

Earnings Growth Drivers - Lumber

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Returns on Lumber

  • 10%
  • 5%

0% 5% 10% 15% 20% 25% 30% 35% 40% 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

EBITDA Margin (%) - Lumber

Average: 16%

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Canadian Shipments to China

500 1,000 1,500 2,000 2,500 3,000 3,500

2006 2007 2008 2009 2010 2011 2012 2013 2014 Proj. MMfbm

Source: Council of Forest Industries, November 2014

Equivalent to 300,000 housing starts *

* Based on consumption of 11.5 Mfbm per U.S. housing start (average mix of single and multi family)

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Canadian Fibre Supply

Million (M3)

Source: FEA, Q4 2014

10 20 30 40 50 60 70 80

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Annual Allowable Cut

Quebec Ontario BC Interior

Forecast

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U.S. South Positive Timber Inventory

Bfbm Int’l ¼”

Source: FEA, Q4 2014

5 10 15 20 25 30 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 Growth Drain

Projected Excess Growth

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  • Reinvest profits to lower costs, improve efficiency

through technology and improved processes

  • Estimate normalized annual capital spending

between $150 and $225 million

  • Capital spending in 2014 of $410 million; projecting

approximately $300 million for 2015

  • Growth through opportunistic acquisitions focused
  • n solid wood

Capital Strategy

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West Fraser Capital

159 358 410

50 100 150 200 250 300 350 400 450 2012 2013 2014 Capital Spending Maintenance Timber Profit Improvement Energy

$ Million

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  • Proven ability to generate strong cash flow even in

worst markets

  • Consistent, straightforward business plan
  • Loyal, long-term employee and management base
  • Conservative financial management coupled with

proven ability to grow strategically

  • Strong historical shareholder returns

Why Invest in West Fraser?

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Strong Cash Generation ($millions)

Total 2014 2013 2012 2011 2010

Cash from Operations 1,595 475 419 195 85 421 Capital Expenditures 1,229 410 358 159 213 89 Acquisitions 238 208

  • 30
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Annualized Shareholder Return (Cdn$)

17.3%

6.5% 6.1%

2.5%

0.1%

13.7% 13.6% 7.6% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18%

West Fraser DAX Dow S&P/TSX FTSE Competitor A Competitor B Competitor C

June 2006* – December 31, 2014

* June 2006 marked the beginning of the steep decline in U.S. housing starts

Source: TD Bank

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Share Value Traded

500 1,000 1,500 2,000 2,500 3,000 3,500 4,000

2014 2013 2012

WFT CFP IFP

Cdn$ Million

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“WFT” – Toronto Stock Exchange www.WestFraser.com

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

  • ffer 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.