Mr. Adam Sheparski reports

ACADIAN TIMBER CORP. REPORTS THIRD QUARTER RESULTS

Acadian Timber Corp. has released financial and operating results for the three months ended Sept. 30, 2023.

"Continued stable regional demand and pricing for Acadian's key products generated solid results for the third quarter," commented Adam Sheparski, president and chief executive officer. "Harvest volumes were supported by improved contractor availability and favourable operating conditions in New Brunswick while wet weather in Maine hindered operations in that region. We expect steady demand and average pricing for the remainder of the year as we continue focusing on further increasing our harvesting capacity."

Acadian generated $4.3-million of free cash flow during the third quarter and declared dividends of $5.0-million to shareholders. Acadian's balance sheet remains solid with $15.9-million of net liquidity as at Sept. 30, 2023, which includes funds available under its credit facilities.

Acadian is committed to health and safety as its No. 1 priority. It believes that emphasizing and achieving a good safety performance are a leading indicator of success in the broader business. Acadian's operations experienced no recordable safety incidents during the quarter among employees or contractors.

Outlook

North American interest rates remain elevated, and near-term pressure on end use markets persists. However, inflationary pressures have begun to show signs of easing, and the consensus forecast for U.S. housing starts has risen to approximately 1.42 million starts in 2023. It remains confident that the stability of the northeastern forestry sector, combined with the long-term demand for new homes and repair and remodel activity, will support the demand for its products.

Although labour markets remain tight, it continued to experience increased contractor availability during the third quarter. Management will continue to focus on further increasing its harvesting capacity through the rest of the year and into 2024. In the short to medium term, inflation is expected to continue to impact its financial results through elevated contractor rates and fuel surcharges.

Demand for Acadian's sawlogs is mainly driven by regional supply and demand, meaning that the stable demand experienced during the first three quarters is expected to continue through the balance of 2023. Pricing for softwood sawtimber is expected to remain stable, but pricing for hardwood sawtimber may continue to weaken, reflecting weakness in hardwood lumber pricing. Demand for hardwood pulpwood is expected to remain steady, and softwood pulpwood markets are expected to remain at the improved levels experienced to date in 2023.

Quarterly dividend

Based on a strong balance sheet and outlook for the rest of the year, Acadian is pleased to announce a dividend of 29 cents per share, payable on Jan. 15, 2024, to shareholders of record on Dec. 31, 2023.

Investors, analysts and other interested parties may listen to Acadian's third quarter 2023 results conference call and webcast on Thursday, Nov. 2, 2023, at 1 p.m. ET. Please register or follow the link on its website to receive your unique PIN. For those unable to participate, a recorded rebroadcast will be available until 4 p.m. ET Nov. 2, 2024.

Acadian is one of the largest timberland owners in Eastern Canada and the northeastern United States, and has a total of approximately 2.4 million acres of land under management. Acadian owns and manages approximately 761,000 acres of freehold timberlands in New Brunswick and approximately 300,000 acres of freehold timberlands in Maine, and provides timber services relating to approximately 1.3 million acres of Crown licensed timberlands in New Brunswick. Acadian's products include softwood and hardwood sawlogs, pulpwood, and biomass byproducts, sold to approximately 90 regional customers.

Acadian's business strategy is to maximize cash flows from its existing timberland assets through sustainable forest management and other land use activities while expanding its business by acquiring assets and actively managing these assets to drive improved performance.

Acadian's shares are listed for trading on the Toronto Stock Exchange under the symbol ADN.

We seek Safe Harbor.