Canfor Corporation · TSX:CFP
Canfor — CIBC World Markets Investors Conference 2006
15 slides from Canfor's conference presentation, Feb 17, 2006
Slide 1: CIBC World Markets Investors Conference
CIBC World Markets Investors Conference February 17, 2006 Scott Wilson Vice-President, Finance and Chief Financial Officer
Slide 2: Forward-Looking Statement Disclaimer
Forward-Looking Statement Disclaimer Certain statements in this presentation, including statements regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions th
Slide 3: Sales and EBITDA by Segment (YTD Dec 2005)
Sales and EBITDA by Segment (YTD Dec 2005) Sales $3.680 billion EBITDA $294 million 24% 21% Lumber Panels 65% 12% Pulp & Paper 10% 67% JAN16 C A N F O R C O R P O R A T I O N PAGE 3
Slide 4: Canfor's Lumber Shipments
Canfor’s Lumber Shipments 15% 10% 75% JAN16 C A N F O R C O R P O R A T I O N PAGE 4
Slide 5: Wood Products Marketing
Wood Products Marketing Benefits of Customer Relationships ! Favourable prices ! Consistent product take-away ! Growth of existing and complementary products Customer require ! On-time delivery ! Vendor managed inventory (VMI) ! Certification ! Growth and product line depth Canfor’s Reman /Reload Si
Slide 6: Diversified Customer Base
Diversified Customer Base Growing with the Top 10 customers Wholesalers Increasing committed volumes Stock Lumber 84 Lumber Japan Lanoga Increasing margin added China Taiwan volumes Universal Home Depot Market diversification Centex Lowes Boise Rona Leveraging Lumber relationship to Panels Pro-Deale
Slide 7: Canfor's Manufacturing and Fibre
Canfor’s Manufacturing and Fibre Beetle region JAN16 C A N F O R C O R P O R A T I O N PAGE 7
Slide 8: Cost Performance
Cost Performance Fibre Conversion Marketing 50% 27% 23% • Log hauling • Energy reduction • Transportation/ practices Logistics • Increase • Stumpage productivity and • Grade optimizers management recovery • Working capital • Cut-to-length • Sourcing management JAN16 C A N F O R C O R P O R A T I O N
Slide 9: Pulp & Paper
Pulp & Paper ! Focus on the strength of reinforcement pulp with strategic customers ! Efficient, low cost facilities - Low fibre and energy costs Global Bleached Softwood Kraft Manufacturing Costs Source: Jaakko Poyry USD/mt 800 3Q05 700 600 Nordic Countries 500 Western Europe Eastern Europe 400 USA
Slide 10: Pulp Income Trust
Pulp Income Trust Transaction ! Transfer the NBSK pulp mills into an Income Trust with 20% returned to existing Canfor shareholders ! Expected to close late in Q2 Strategic rationale ! Canfor management focus on the core wood products business – profitability and growth ! Value to shareholders – Ret
Slide 11: Organic Growth - Capital Planning
Organic Growth - Capital 360 Rigourous Capital Planning ! feasibility study ! concept development 240 ! value engineering ! conservative price and start-up assumptions used 120 Contractor Relationships Board Committee Review 0 2004 2005 Maintenance Opportunistic Energy Strategic Post-project apprais
Slide 12: New South acquisition
New South acquisition Transaction ! All shares of New South Companies for US$205 million ! Expected to close late Q1-2006 ! Synergies of US$10 million per annum Strategic rationale ! Platform for future growth – Top quartile assets in a US growth region New South Express – Experienced successful man
Slide 13: Canfor's Financial Strength
Canfor’s Financial Strength Financial Capacity ! Investment grade credit metrics (as at Dec 2005) – Net debt : Capitalization ratio = 14% – Net debt : EBITDA = 1.1x – EBITDA : Interest = 7.0x ! Access to capital and liquidity throughout the cycle ! Spending will be disciplined: – Capital program – M
Slide 14: Canfor: Value plus Growth
Canfor: Value plus Growth ! Wood Products focus ! Integrated marketing and manufacturing ! Disciplined cost focus ! Significant organic growth opportunities ! Financial strength to pursue external growth ! Balanced, experienced management team JAN16 C A N F O R C O R P O R A T I O N PAGE 14
Slide 15: Investor Relations
C O R P O R A T I O N C A N F O R CIBC World Markets Investors Conference Investor Relations: David Jan 604-661-5424 [email protected] www.canfor.com JAN16 PAGE 15
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