Third Quarter (Acadian Timber 2026 Q3 Interim Report)

Letter to Shareholders1

Acadian generated $5.0 million of Adjusted EBITDA2 and $4.4 million of Net Income during Q3 2026, compared to $3.5 million and $2.9 million during the same period of 2025.

Much of the year-over-year improvement is attributable to Maine. The internal harvesting operations were restructured beginning in Q2, resulting in leaner, more efficient operations. The results of these efforts are clear, but there is more work to be done, such as adding capacity to our existing equipment, developing new markets for certain products, and optimizing block selection to facilitate efficient harvesting operations. As we pursue these opportunities, we expect our business in Maine to continue delivering stronger results in 2026 compared to 2025, and stronger results in 2027 compared to 2026.

New Brunswick had a softer quarter. Weak softwood pulpwood demand and elevated customer inventories as compared to Q3 2025 led to lower sales. The impact was largely offset by stronger selling prices. Despite these variances, we expect that New Brunswick will deliver stable results over the rest of the year compared to last year.

With respect to newer segments of our business, Real Estate sold several non-core, small parcels at attractive valuations and continued advancing its leasing and recreational initiatives. In time, we expect Real Estate to emerge as a material, and non-depletive, pillar of our business. Environmental Solutions continued working towards the registration of the next tranche of carbon credits from our proven project in Maine.

Fuel costs and tariffs are weighing on the regional forestry sector. Pricing mechanisms in our customer contracts have supported partial recovery of elevated fuel costs so far, particularly in New Brunswick. In Maine, where our internal harvesting capacity is directly exposed to fuel costs, our recovery is lower. Tariffs are weighing on our customers' outlooks but we have not yet seen significant curtailment or reductions in roundwood procurement tied to tariffs.

There were several positive announcements in Q3 in New Brunswick, including the planned conversion of a coal plant to biomass, an enhanced focus on wind and solar energy development, and significant funding for the establishment of a Strategic Innovation Centre in Digital Forestry. Each of these announcements support our positive outlook for New Brunswick as one of the best forestry jurisdictions in North America.

As we move into the fourth quarter and the start of the winter harvesting season, we are well positioned for a productive end to the year, supported by sufficient contractor availability in New Brunswick, continued operational improvements in Maine, and advancing the newer segments of our business.

The Board of Directors has declared a dividend of $0.29 per share, consistent with prior quarters. At the same time, Macer Forest Holdings Inc., our largest shareholder, has reiterated its intention to participate in the DRIP for 100% of dividends payable to it. We believe that this approach, supported by our net liquidity2 position of $16.4 million as at September 26, 2026, will continue delivering the most value for our shareholders.

In closing, and on behalf of the Board of Directors, thank you for your ongoing support.

Malcolm Cockwell

Interim President and Chief Executive Officer October 28, 2026

1. The following contains forward-looking information about Acadian Timber Corp.'s outlook. Reference should be made to the section entitled "Cautionary Statement Regarding Forward-Looking Information and Statements" in Management's Discussion and Analysis for further details.

2. Adjusted EBITDA and Net Liquidity are Non-IFRS measures. Please refer to the section entitled "Non-IFRS Measures" in Management's Discussion and Analysis for further details.

(All figures in Canadian dollars unless otherwise stated)

October 28, 2026

Basis of Presentation

This management's discussion and analysis ("MD&A") discusses the financial condition and results of operations of Acadian Timber Corp. ("Acadian", the "Company" or "we") for the three months and nine months ended September 26, 2026 (the "third quarter" or "Q3 2026") compared to the three months and nine months ended September 27, 2025 ("Q3 2025") and should be read in conjunction with the unaudited interim condensed consolidated financial statements and notes thereto for the third quarter and the audited annual consolidated financial statements and the related MD&A for the fiscal year ended December 31, 2025.

Our third quarter unaudited interim condensed consolidated financial statements have been prepared in accordance with IAS 34 "Interim Financial Reporting" using the accounting policies adopted and disclosed in Note 2 of Acadian's audited 2025 consolidated financial statements and as updated in Note 2 of the third quarter unaudited condensed consolidated financial statements, and are expressed in Canadian dollars unless otherwise noted. External economic and industry factors remain broadly unchanged since the previous annual report, unless otherwise noted. This MD&A has been prepared based on information available as at October 28, 2026. Additional information is available on Acadian's website at https://www.acadiantimber.com and on SEDAR+ at https://www.sedarplus.ca

Non-IFRS Measures

Throughout this MD&A, reference is made to "Adjusted EBITDA", which Acadian's management defines as net income before interest, income taxes, fair value adjustments, non-cash cost of sales related to carbon credits, recovery of or impairment of land and roads and depreciation and amortization, and to "Adjusted EBITDA margin", which is Adjusted EBITDA as a percentage of sales. Reference is also made to "Free Cash Flow", which Acadian's management defines as Adjusted EBITDA less interest paid, current income tax expense, capital expenditures excluding acquisitions of timberlands and non-cash expenditures, and mandatory debt repayments plus net proceeds from the sale of timberlands and other fixed assets (proceeds less gains or losses). Management believes that Adjusted EBITDA, Adjusted EBITDA margin, and Free Cash Flow are key performance measures in evaluating Acadian's operations and are important in enhancing investors' understanding of the Company's operational performance. Adjusted EBITDA and Adjusted EBITDA margin are indicative of the underlying profitability of Acadian's operating segments and are used to evaluate operational performance. Free Cash Flow is used to evaluate Acadian's ability to generate sustainable cash flows from operations that are available for dividends, repurchases of common shares, debt reduction, acquisitions, and other capital allocation activities. We have provided reconciliations of net income as determined in accordance with IFRS, to Adjusted EBITDA and Free Cash Flow in the "Adjusted EBITDA and Free Cash Flow" section of this MD&A. Reference is also made to "net liquidity" which includes cash and cash equivalents and funds available under credit facilities less amounts reserved to support the minimum cash balance related to long-term debt.

As these measures do not have a standardized meaning prescribed by IFRS, they may not be comparable to similar measures presented by other companies.

Assessment and Changes in Disclosure Controls and Internal Controls

Management, including the Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of the design and operation of the Company's disclosure controls and procedures as at December 31, 2025. There have been no changes in our disclosure controls and procedures during the nine months ended September 26, 2026 that have materially affected, or are reasonably likely to materially affect, our disclosure controls and procedures.

Management, including the Chief Executive Officer and Chief Financial Officer, have also evaluated the design and effectiveness of our internal controls over financial reporting in accordance with Multilateral Instrument 52-109 using the COSO Framework 2013 as at December 31, 2025. There have been no changes in our internal controls over financial reporting during the nine months ended September 26, 2026 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Introduction

Acadian is one of the largest timberland owners in Eastern Canada and the Northeastern U.S. We own and manage 775,000 acres of freehold timberlands in New Brunswick ("New Brunswick Timberlands") and approximately 300,000 acres of freehold timberlands in Maine ("Maine Timberlands"). Acadian also provides timber services relating to 1.3 million acres of Crown licensed timberlands in New Brunswick.

Our primary business is the production of softwood and hardwood sawlogs, pulpwood, and biomass by-products, sold to approximately 85 regional customers. Acadian also generates income through other operations, including Real Estate and Environmental Solutions.

Acadian's business strategy is to maximize cash flows from its existing timberland assets through sustainable forest management and other land use activities. We aim to grow our business by acquiring additional timberland assets at value and actively manage those assets to drive improved performance.

Summary of Third Quarter Results

The table below summarizes operating and financial data for Acadian:

Three Months Ended Nine Months Ended

1. Non-IFRS Measure. See "Non-IFRS Measures" on page 2 of this report.

2. As at October 28, 2026 there were 18,949,610 common shares outstanding.

Results for Q3 2026 and for the nine months ended September 26, 2026 reflect improvements at our internal harvesting operations in Maine, and increased pricing for our products, partially offset by lower sales volumes in New Brunswick.

Timber sales and services were $24.0 million in Q3 2026, $1.0 million higher than Q3 2025. Timber sales were relatively flat, as a 17% increase in the weighted average selling price offset 14% lower sales volumes, both excluding biomass. Pricing benefited from stronger end-use markets and higher fuel surcharges. While volumes increased in Maine due to operational improvements, volumes decreased in New Brunswick due to weaker softwood pulpwood demand. Timber services revenue increased $0.8 million compared to Q3 2025, reflecting increased activity for neighbouring landowners in Maine.

Operating costs and expenses increased $0.2 million from Q3 2025. Increased cost of sales per m3 in New Brunswick, higher land management costs and higher silviculture spending were partially offset by the impact of lower total sales volumes and lower cost of sales per m3 in Maine.

Net income for Q3 2026 totaled $4.4 million, or $0.23 per share, compared to $2.9 million or $0.16 per share during the same period last year. Higher operating income, higher non-cash fair value adjustments and higher gains on the sale of timberlands

and other fixed assets were partially offset by higher income tax expense.

For the nine months ended September 26, 2026 timber sales and services were $62.0 million, $3.0 million lower than the same period of 2025. Timber sales decreased $2.5 million, as 13% lower sales volumes were partially offset by a 9% increase in the weighted average selling price, both excluding biomass, for the reasons described above. Timber services revenue decreased $0.4 million, as lower activity on Crown licensed timberlands in New Brunswick was largely offset by increased activity for neighbouring landowners in Maine. Net income totaled $9.2 million, or $0.49 per share, compared to $9.3 million or $0.51 per share during the same period last year. Higher non-cash fair value adjustments and higher gains on the sale of timberlands and other fixed assets were offset by higher income tax expense.

Segmented Results of Operations

New Brunswick Timberlands

Acadian's New Brunswick Timberlands business owns and manages 775,000 acres of freehold timberlands in New Brunswick, and provides management services to 1.3 million acres of Crown licensed timberlands in New Brunswick. All harvesting operations are performed by third-party contractors.

Freehold sales were $15.8 million in Q3 2026, compared to $16.9 million last year, reflecting primarily lower softwood sales volumes due to elevated customer roundwood inventories and abundant sawmill residuals in the region, partially offset by higher hardwood sales volumes. The impact of lower sales volumes was largely offset by a 19% increase in the weighted average selling price, excluding biomass, driven by stronger softwood lumber markets and higher fuel surcharges. Freehold variable costs per m3 were 16% higher due to higher fuel adjustment costs. Timber services activity was consistent with the same period last year. Adjusted EBITDA was $3.9 million for Q3 2026, compared to $4.4 million in Q3 2025.

For the nine months ended September 26, 2026, freehold sales were $42.8 million, compared to $47.0 million last year, reflecting lower sales volumes. The impact of lower sales volumes was partially offset by an 11% increase in the weighted average selling price, excluding biomass, for the reasons described above. Freehold variable costs per m3 were 14% higher, also for the reasons described above. Timber services activity was $2.4 million lower year over year as a result of a change in customer mix which redirected harvesting from Crown licensed timberlands to our freehold operations. Adjusted EBITDA was

$11.8 million, compared to $14.2 million in the same period of 2025.

Maine Timberlands

Acadian's Maine Timberlands business owns and manages 300,000 acres of freehold timberlands in Maine. Prior to January 1, 2025, all harvesting operations in Maine Timberlands were performed by third-party contractors. During Q1 2025, Acadian established its own internal harvesting operations. The transition and rationale for the relevant transactions were described in Acadian's Q1 2025 interim report dated May 7, 2025.

Freehold sales were $3.5 million in Q3 2026, compared to $2.1 million in Q3 2025, reflecting a 54% increase in sales volumes, excluding biomass, as a result of operational improvements within our internal harvesting operations. The weighted average selling price, excluding biomass, increased 2% in U.S. dollar terms, due to a favourable product mix and higher fuel surcharges partly offset by a higher proportion of roadside sales. Timber services and other activity increased by $0.8 million, as the activity on neighbouring landowners increased. Freehold cost of sales per m3 were 39% lower than Q3 2025 due to reduced fixed costs and operational efficiencies. Gain on sale of timberlands was $0.8 million higher than the same period of 2025. Adjusted EBITDA was $1.3 million compared to $(0.5) million in Q3 2025.

For the nine months ended September 26, 2026, freehold sales were $8.6 million, compared to $6.9 million last year, reflecting higher sales volumes. The weighted average selling price, excluding biomass, in U.S. dollar terms decreased 3% compared to the same period last year due to an increase in roadside sales, combined with stumpage sales that occurred during Q1 2026, partially offset by higher fuel surcharges. Freehold cost of sales per m3 were 27% lower for the reasons cited above. Timber services and other activity was $2.0 million higher than the first nine months of 2025, reflecting increased activity for neighbouring landowners in Maine. Gain on sale of timberlands, which were small, waterfront building lots, was

$0.6 million higher than the same period of 2025. Adjusted EBITDA was $1.4 million compared to $(2.1) million.

Other Businesses1

Environmental Solutions leverages the ecological functions of Acadian's land and technical expertise of its team to address pressing environmental challenges, such as climate change. During Q3 2026 and Q3 2025, no carbon credits were sold. Acadian is in the process of registering additional carbon credits for sale, which is expected to occur by the end of 2026.

Real Estate is an emerging business, which develops new sources of revenue from Acadian's land through recreational activities and leases, commercial leases, and land sales. The financial performance of Real Estate is currently included in the reported results for New Brunswick Timberlands and Maine Timberlands. As these activities are further developed, Real Estate may be reported as its own segment.

Acadian had net liquidity of $16.4 million as at September 26, 2026, which includes cash and funds available under credit facilities less amounts reserved to support the minimum cash balance related to long-term debt.

A portion of long-term debt totaling $45.3 million is scheduled to mature March 6, 2027 as included within Contractual Obligations. It is management's intention to refinance the debt prior to the maturity date.

Liquidity and capital resources are discussed in the Company's MD&A for the year ended December 31, 2025.

Sufficient contractor availability in New Brunswick is expected to continue through the remainder of 2026 and the 2027 winter season. In Maine, we expect to build upon the improvements made since Q2 and to continue progressing towards our targeted production levels as well as cost structure over the course of the year.

Demand for Acadian's products is mainly driven by regional supply dynamics. Near-term sawlog demand and pricing is expected to remain stable until end-use markets improve. Demand and pricing for pulpwood in both New Brunswick and Maine is expected to remain at reduced levels until existing customers increase their production and new facilities that consume pulpwood as well as biomass are commissioned.

Looking through to end-use markets, most macroeconomic indicators are neutral in the short-term and positive in the longterm. The consensus forecast for U.S. housing starts is steady at approximately 1.34 million starts in each of 2026 and 2027. Temporary and permanent curtailments of forest products facilities in other regions of North America are expected to support the demand and pricing conditions for Acadian's customers in New Brunswick and Maine. These trends align with our conviction in the stability of the northeastern forestry sector.

Furthermore, several regional initiatives, including the planned conversion of a coal plant to biomass and announcements relating to expansions of existing sawmills and pulp mills, lend confidence to growing demand for our products. Noting that Acadian maintains multiple customers for each of its products, the positive and incremental demand represented by these announcements may be partially offset by the recent curtailment of a regional hardwood pulp mill.

Tariffs and duties continue impacting most of our customers. Higher fuel costs, which took effect in early-Q2 and which we are able to partially recover from our customers, are also impacting our customers. While we have not observed significant curtailments among our customers so far this year, these factors are expected to continue limiting the extent to which our customers utilize the full capacity of their manufacturing facilities.

With respect to voluntary carbon credits, demand and pricing are expected to remain stable. Issuance of the next tranche of carbon credits from Acadian's current project has been delayed due to the transition to ACR's updated Improved Forest Management protocol. The registration of additional carbon credits is anticipated before the end of 2026, and the updated protocol is expected to improve the marketability of the resulting carbon credits. While Acadian is evaluating opportunities

1 The following contains forward-looking information about Acadian Timber Corp.'s outlook. Reference should be made to the section entitled "Cautionary Statement Regarding Forward-Looking Information and Statements" for further details.

to develop additional projects, our focus is on the existing carbon credit project in Maine.

Detailed Segmented Results

The table below summarizes operating and financial results for New Brunswick Timberlands:

Three Months Ended Nine Months Ended

The table below summarizes operating and financial results for Maine Timberlands:

Three Months Ended Nine Months Ended

Adjusted EBITDA and Free Cash Flow

The following table provides a reconciliation of net income, as determined in accordance with IFRS, to Adjusted EBITDA and Free Cash Flow during each respective period:

Three Months Ended Nine Months Ended

(CAD thousands) September

26, 2026

September 27, 2025

September 26, 2026

September 27, 2025

1. Non-IFRS Measure. See "Non-IFRS Measures" on page 2 of this report.

   Selected Consolidated Quarterly Information

   The table below sets forth selected consolidated quarterly information for the current and last seven quarters.

   2026				2025				2024
   (CAD thousands, except per share data and where indicated)	Q3	Q2	Q1	Q4	Q3	Q2	Q1	Q4
   Timber sales volume (000s m3)	225.3	132.1	267.7	277.5	260.6	191.0	266.9	232.3
   Timber sales and services	$ 24,021	$ 14,561	$ 23,412	$ 21,976	$ 23,017	$ 17,129	$ 24,834	$ 20,226
   Net income	4,384	1,313	3,471	39,720	2,928	2,667	3,659	5,585
   Per share - basic and diluted	$ 0.23	$ 0.07	$ 0.19	$ 2.18	$ 0.16	$ 0.15	$ 0.21	$ 0.32

   Results are impacted by seasonality. Harvest activity is highest during the winter months, when the ground is frozen, providing a solid base for harvesting and hauling equipment. There is a significant decrease in activity during the spring when the ground thaws. Harvesting activity resumes in late spring or early summer when the ground dries and continues through the fall.

   Net income can be significantly impacted by non-cash items such as fluctuations in foreign exchange and the fair value adjustment of the Company's timberlands, which are revalued at each reporting period. During the fourth quarter of 2025, Acadian recorded a fair value adjustment gain on timberlands in the amount of $51.5 million.

   Dividend Policy of the Company

   Acadian declares dividends from its available cash to the extent determined prudent by the Board of Directors. Dividends are paid on or about the 15th day following each dividend record date.

   Total dividends declared during the three months and nine months ended September 26, 2026 were $5.4 million and $16.2

   million (September 27, 2025 - $5.3 million and $15.6 million) or $0.29 and $0.87 per share (September 27, 2025 - $0.29 and

   $0.87 per share).

   Acadian has in place a dividend reinvestment plan ("DRIP") effective with eligible shareholders whereby Canadian resident shareholders may elect to automatically have their dividends reinvested in additional shares issued directly from the treasury of the Company. During the three and nine months ended September 26, 2026, Acadian issued 160,821 and 493,766 common shares in accordance with the DRIP.

   Macer Forest Holdings Inc. ("Macer"), which owns approximately 53% of the outstanding common shares of Acadian as at October 28, 2026 (September 26, 2026 - 52%), participates in the DRIP for 100% of dividends payable to it.

   Related Party Transactions

   There were no related party transactions during the third quarter other than shares issued to Macer in accordance with the DRIP, as included within Dividend Policy of the Company.

   Critical Judgments and Estimates

   The preparation of financial statements in accordance with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reported period. The critical estimates and judgements applied in preparing Acadian's consolidated financial statements affect the determination of the timing of satisfaction of performance obligations related to revenue recognition, assessment of net recoverable amounts, net realizable values and fair values, including the fair value of assets acquired as part of a business combination, depreciation rates and useful lives, determination of functional currency and the selection of accounting policies.

   The critical judgements and estimates made in the preparation of Acadian's consolidated financial statements include, among other things, determining Acadian's customer and the timing of transfer of control in carbon credit sales arrangements, future prices and margins, future sales volumes, future harvest rates and sustainable yields, and discount rates utilized in the valuation of Acadian's timber, roads and land. In making estimates and judgements, management relies on external information and observable conditions where possible, supplemented by internal analysis as required. These estimates and judgements have been applied in a manner consistent with prior periods and there are no known trends, commitments, events or uncertainties that we believe will materially affect the methodology or assumptions utilized in making these estimates and judgements in these consolidated financial statements.

   For further reference on critical accounting policies, see our material accounting policies contained in Note 2 of Acadian's audited 2025 consolidated financial statements.

   The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

   Contractual Obligations

   The Company has two significant contractual obligations, being the Fibre Supply Agreement and the Crown Lands Services Agreement.

   The Fibre Supply Agreement between the Company and Groupe Lebel expires in 2031. The provision of timber services under the Crown Lands Services Agreement at the direction of Twin Rivers Paper Company has a term equal to the term of the Crown License, including any renewal terms.

   The table below summarizes the Company's debt obligations as at September 26, 2026:

   Payments Due by Period

   (CAD thousands)	Total	Less Than One Year	1 to 3 Years (2027-2029)	4 to 5 Years (2030-2031)	After 5 Years (>2031)
   Term facilities
   Tranche due March 6, 20271 $ 45,264		$ 45,264	$ -	$ -	$ -
   Tranche due March 6, 20301 22,632		-	-	22,632	-
   Tranche due March 6, 20301 45,264		-	-	45,264	-
   	113,160	45,264	-	67,896	-
   Equipment loan	1,045	734	311	-	-
   Long-term debt	$ 114,205	$ 45,998	$ 311	$ 67,896	$ -
   Short-term debt	$ 1,202	$ 1,202	-	-	-
   Interest payments	$ 10,949	$ 3,582	$ 6,097	$ 1,270	$ -

   1. Represents principal of the U.S. dollar denominated term facilities with a U.S. to Canadian dollar conversion rate of 1.41, excluding the unamortized deferred financing costs.

Risk factors are discussed in the Company's Annual Information Form dated March 27, 2026 except as noted below.

Fuel Costs

Acadian, its contractors, and its customers are exposed to fuel costs through their direct and indirect reliance on fuel-intensive harvesting, processing, and transportation equipment. Rising fuel costs therefore affect both Acadian's operating costs and the financial health of its customers. Acadian maintains contractual mechanisms with many contractors that allow for rate increases when fuel prices exceed defined thresholds and with many customers that allow for partial recovery of increased fuel-related costs incurred by Acadian. Other customer arrangements are short-term in nature, enabling more frequent price resets. While these mechanisms can mitigate the impact of fuel price fluctuations to Acadian, they may not fully offset rapid or sustained increases, and there is no assurance that such adjustments will be available or accepted in all market conditions. Sustained or further increases in fuel prices could materially adversely affect our future financial performance.

Cautionary Statement Regarding Forward-Looking Information and Statements

This MD&A contains forward-looking information and statements within the meaning of applicable Canadian securities laws that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Acadian Timber Corp. and its subsidiaries (collectively, "Acadian"), or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking information is included in this MD&A and includes statements made in the section entitled "Outlook" and without limitation other statements regarding management's beliefs, intentions, results, performance, goals, achievements, future events, plans and objectives, business strategy, growth strategy and prospects, access to capital, liquidity and trading volumes, dividends, taxes, capital expenditures, projected costs, market trends and similar statements concerning anticipated future events, results, achievements, circumstances, performance or expectations that are not historical facts. All forward-looking statements in this MD&A are qualified by these cautionary statements. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, should not be unduly relied upon, and will not necessarily be accurate indications of whether or not such results will be achieved. Actual results may vary. These forward-looking statements include, but are not limited to:

• Expectations regarding the number and timing of carbon credits that will be successfully registered and available for sale. Actual credit issuances will be adjusted each reporting period based on actual harvesting, natural disturbances and other factors, as well as periodic updating for inventory and verification activities.

• Expectations regarding product demand, pricing and end use markets, including expectations for U.S. housing starts, which may be impacted by changes in interest rates, U.S. population demographics and the inventory of homes for sale. Expectations regarding product demand and pricing are based on anticipated market conditions, anticipated regional inventory levels of key customers, and the economic situation of key customers. Estimates for U.S. housing starts are based on forecasts published by major financial institutions.

• Expectations regarding future production volumes and costs which may be impacted by operational efficiency, the regional supply of skilled operators, product demand, sales pricing, fuel price volatility, and end use markets.

• Expectations regarding the impacts of escalated duties on softwood lumber and tariffs or potential tariffs levied on

  U.S. imports from Canada, which may include direct impacts related to changes to the price of and demand for Acadian's products originating in Canada as well as the U.S., and indirect impacts associated with changes in the price of and demand for the products of Acadian's key customers and the greater economy.

• Expectations regarding future contractor availability, which may be impacted by regional supply of trained contractors and changes in the demographics of the available workforce.

Other risks and factors are discussed in each of the Annual Information Form dated March 27, 2026 and the Management Information Circular dated March 27, 2026 and other filings of Acadian made with securities regulatory authorities, which are available on SEDAR+ at https://www.sedarplus.ca.. Forward-looking information is based on various material factors or assumptions, which are based on information currently available to Acadian. Readers are cautioned that the preceding list of material factors or assumptions is not exhaustive. Although the forward-looking statements contained in this MD&A are based upon what management believes are reasonable assumptions, Acadian cannot assure readers that actual results will be consistent with these forward-looking statements. The forward-looking statements in this MD&A are made as of the date of this MD&A based on information currently available to management and should not be relied upon as representing Acadian's views as of any date subsequent to the date of this MD&A. Acadian assumes no obligation to update or revise these forward-looking statements to reflect new information, events, circumstances or otherwise, except as may be required by applicable law.

(unaudited)

See accompanying notes to interim condensed consolidated financial statements.

(unaudited)

Three Months Ended Nine Months Ended

See accompanying notes to interim condensed consolidated financial statements.

(unaudited)

See accompanying notes to interim condensed consolidated financial statements.

(unaudited)

See accompanying notes to interim condensed consolidated financial statements.

Details of the net change in non-cash working capital balances and other:

Three Months Ended Nine Months Ended

(unaudited) (All figures in Canadian dollars unless otherwise stated)

1. GENERAL

   Acadian Timber Corp. (the "Company") is governed by the Canada Business Corporations Act pursuant to articles of arrangement dated January 1, 2010. The Company is a reporting issuer and its common shares are publicly traded on the Toronto Stock Exchange under the stock symbol "ADN". The principal and head office of the Company is located at 6 Crabtree Ave., Edmundston, New Brunswick, E3V 3K5.

   The Company and all of its consolidated subsidiaries (collectively "Acadian") own and manage approximately 775,000 acres of freehold timberlands in New Brunswick and approximately 300,000 acres of freehold timberlands in Maine and provide timber services relating to approximately 1.3 million acres of Crown licensed timberlands in New Brunswick. Acadian's primary business is forest management and the production of timber products, including softwood and hardwood sawlogs, pulpwood, and biomass by-products, sold to approximately 85 regional customers. Acadian also generates income through other operations, including real estate and environmental solutions.

   Acadian's operations are subject to seasonal variations and, as a result, operating results vary from quarter to quarter. Harvesting activity can be compromised by inaccessibility to some sites during wet seasons, resulting in decreased harvest levels. Results of one quarter will not be indicative of results that may be achieved in other quarters or for the full year.

   As at September 26, 2026, Macer Forest Holdings Inc. owns 9,816,860 shares representing approximately 52% of the outstanding shares of the Company and is the ultimate parent entity of the Company.

2. MATERIAL ACCOUNTING POLICIES

   These unaudited interim condensed consolidated financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB") and using the accounting policies adopted and disclosed in Note 2 of Acadian's audited 2025 consolidated financial statements, except for the adoption of new accounting standards effective January 1, 2026. These interim condensed consolidated financial statements should be read in conjunction with Acadian's audited annual consolidated financial statements for the fiscal year ended December 31, 2025.

   These unaudited interim condensed consolidated financial statements were authorized for issuance by the Board of Directors of Acadian on October 28, 2026.

   Adoption of New Accounting Standards

   Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures re: Classification and Measurement of Financial Instruments

   The amendments clarify the date of recognition and derecognition of some financial assets and liabilities and introduce an accounting policy option to derecognize financial liabilities settled using an electronic payment system when certain criteria are met. The amendments also provide additional clarity and guidance for assessing whether a financial asset meets the solely payments of principal and interest criterion, add new disclosures for certain financial instruments with contractual terms that can change cash flows and update the disclosures for equity instruments designated at fair value through other comprehensive income. The amendments are effective for reporting periods beginning on or after January 1, 2026. The Company elected the accounting policy option to derecognize financial liabilities settled through electronic payment systems prior to the settlement date when the criteria are met. The adoption of these amendments did not have a material impact to these consolidated financial statements.

3. INVENTORIES

Timber is measured at fair value. During the year, adjustments are made to standing timber assets to reflect the change in fair value due to gains arising from growth and reductions arising from harvest. Average selling price less costs of harvesting and selling is applied to expected volume growth to calculate gains arising from growth, and to the harvested volume to calculate reductions arising from harvest. On an annual basis, the fair value of standing timber assets is reassessed with the assistance of licensed independent third-party appraisers. Fair value adjustments are recognized in net income.

Acadian has term credit facilities with MetLife Insurance Company, with maturity dates ranging from March 6, 2027 to March 6, 2030. These credit facilities include a revolving credit facility of up to U.S. $10.0 million (the "Revolving Facility") for general corporate purposes and term credit facilities of U.S. $80 million (the "Term Facilities"). The Term Facilities bear interest at rates ranging from 2.7% to 5.3%. The Revolving Facility bears interest at floating rates based on the Secured Overnight

Financing Rate plus applicable margin. There are no scheduled repayments of principal required prior to the maturity dates of the Term Facilities.

As at September 26, 2026, Acadian had borrowed U.S.$80.0 million (December 31, 2025 - U.S. $80.0 million) under the Term Facilities and U.S.$0.9 million (C$1.2 million) (December 31, 2025 - $nil) under the Revolving Facility. U.S.$2.3 million of the Revolving Facility is reserved to support the minimum cash balance requirement of the Term Facilities. As security for these facilities, Acadian granted the lenders a security interest over the majority of its assets. The facilities are subject to customary terms and conditions for borrowers of this nature, including limits on incurring additional indebtedness and granting liens or selling assets without the consent of the lenders. The credit facilities are also subject to the maintenance of a maximum loan-to-value ratio. Acadian is in compliance with all covenants as at September 26, 2026 and December 31, 2025.

Acadian has a $2.0 million Canadian dollar denominated revolving credit facility with a major Canadian bank for general corporate purposes. This facility bears interest at floating rates based on bank prime rates plus applicable margin and is due on demand. No amounts were drawn on this facility as at September 26, 2026 or December 31, 2025.

Acadian has equipment financing with a remaining balance of U.S.$0.7 million as at September 26, 2026 (December 31, 2025 - U.S.$1.1 million) which bears interest at 2.5% and is repayable in monthly principal and interest instalments ending January 2028. The related equipment has been pledged as security.

The fair value of the Term Facilities as at September 26, 2026 is $109.0 million (December 31, 2025 - $107.5 million). The fair value of the Term Facilities is determined using the discounted cash flow approach and is measured under Level 2 of the fair value hierarchy. Future cash flows are estimated based on the terms under the Term Facilities and discounted at a rate reflecting appropriate market fundamentals relating to the debt. The carrying value of the equipment loan is assumed to reasonably approximate fair value given the lack of significant changes in underlying market conditions.

1. SHAREHOLDERS' EQUITY

   Acadian is authorized to issue an unlimited number of common shares. The common shares have no stated par value.

   Acadian has in place a dividend reinvestment plan ("DRIP") whereby Canadian resident shareholders may elect to automatically have their dividends reinvested in additional shares. Shares issued under the DRIP are issued directly from the treasury of the Company at a price equal to the volume-weighted average trading price of the Company's shares on the TSX for the five trading days immediately preceding the relevant dividend payment date, which is typically on or about the 15th of April, July, October and January. During the quarter, Acadian issued 160,821 common shares in accordance with the DRIP.

   The Company's issued and outstanding common shares are as follows:

   (CAD thousands except share data)	Number of Shares	Share Capital
   Balance as at December 31, 2025	18,286,767	$ 166,693
   Common shares issued - DRIP	493,766	8,314
   Balance as at September 26, 2026	18,780,533	$ 175,007

2. NET INCOME PER SHARE

   Basic net income per share is calculated by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. There are no dilutive potential shares.

   Three Months Ended Nine Months Ended

   September 26, 2026

   September 27, 2025

   September 26, 2026

   September 27, 2025

   Weighted average number of common shares - basic and diluted

   18,748,722 18,095,837 18,589,964 18,016,862

3. SEGMENTED INFORMATION

   Acadian's presentation of reportable segments is based on how management has organized the business in making operating and capital allocation decisions and assessing performance. Acadian has three reportable segments: New Brunswick Timberlands, Maine Timberlands and Environmental Solutions. The Environmental Solutions segment includes business activities related to the development and sale of voluntary carbon credits. There were no sales, expenses or Adjusted EBITDA related to Environmental Solutions during the three months and nine months ended September 26, 2026 or September 27, 2025.

   The material accounting policies followed for the segments are consistent with those described in Note 2. Adjusted EBITDA is used to evaluate the operational performance of reportable segments. Adjusted EBITDA is defined as net income before interest, income taxes, fair value adjustments, non-cash cost of sales related to carbon credits, recovery of or impairment of land and roads, and depreciation and amortization.

   Sales, Cost of sales, Selling, administration and other expenses, and Adjusted EBITDA by reportable segment are as follows:

   Three Months Ended Nine Months Ended

   	September	September	September	September
   (CAD thousands)	26, 2026	27, 2025	26, 2026	27, 2025
   Sales
   New Brunswick Timberlands
   Softwood	$ 9,621	$ 11,592	$ 24,546	$ 28,459
   Hardwood	5,971	5,063	17,658	17,798
   Biomass	165	234	599	757
   Timber services and other sales	3,659	3,626	7,568	10,001
   Total New Brunswick Timberlands sales	$ 19,416	$ 20,515	$ 50,371	$ 57,015
   Maine Timberlands
   Softwood	$ 2,511	$ 1,289	$ 6,311	$ 4,139
   Hardwood	925	858	2,175	2,664
   Biomass	40	-	102	113
   Timber services and other sales	1,129	355	3,035	1,049
   Total Maine Timberlands sales	$ 4,605	$ 2,502	$ 11,623	$ 7,965
   Total sales	$ 24,021	$ 23,017	$ 61,994	$ 64,980
   Cost of sales
   New Brunswick Timberlands	$ 12,699	$ 13,457	$ 32,892	$ 37,110
   Maine Timberlands	3,675	2,511	10,333	8,317
   Total cost of sales	$ 16,374	$ 15,968	$ 43,225	$ 45,427
   Selling, administration and other
   New Brunswick Timberlands	$ 1,317	$ 1,452	$ 3,881	$ 4,363
   Maine Timberlands	442	839	1,541	2,449
   Corporate	257	381	2,134	1,579
   Total selling, administration and other	$ 2,016	$ 2,672	$ 7,556	$ 8,391

   Three Months Ended Nine Months Ended

   	September	September	September	September
   (CAD thousands)	26, 2026	27, 2025	26, 2026	27, 2025
   Adjusted EBITDA
   New Brunswick Timberlands	$ 3,907	$ 4,363	$ 11,810	$ 14,218
   Maine Timberlands	1,346	(503)	1,383	(2,114)
   Environmental Solutions	-	-	-	-
   Total segment Adjusted EBITDA	5,253	3,860	13,193	12,104
   Corporate expenses	(230)	(352)	(2,050)	(1,502)
   Fair value adjustments and other	2,740	1,192	8,798	5,554
   Interest expense, net	(1,151)	(1,049)	(3,410)	(2,934)
   Depreciation and amortization	(477)	(552)	(1,444)	(1,369)
   Income before income taxes	$ 6,135	$ 3,099	$ 15,087	$ 11,853

   Approximately 30% and 28% of total sales during the three months and nine months ended September 26, 2026 were originated with customers domiciled in the U.S. and the balance in Canada (September 27, 2025 - 25% and 25%). Approximately 26% and 24% of total sales were denominated in U.S. dollars during the same period (September 27, 2025 -17% and 18%).

   Acadian sells its products to many companies in North America. For the three months and nine months ended September 26, 2026, sales to the largest and next largest customer accounted for 32% and 12%, and 32% and 12%, respectively (September 27, 2025 - 27% and 14%, and 21% and 16%, respectively).

4. FINANCIAL INSTRUMENTS

   Financial Risk management - Foreign Currency Risk

   Acadian has designated a hedging relationship between part of the net investment in its Maine subsidiary and its U.S. dollar-denominated debt, which mitigates the foreign currency risk arising from the subsidiary's net assets. The long-term debt is designated as a hedging instrument for the changes in the value of the net investment that is attributable to changes in the Canadian dollar/U.S. dollar spot rate.

   To assess hedge effectiveness, Acadian determines the economic relationship between the hedging instrument and the hedged item by comparing changes in the carrying amount of the debt that is attributable to a change in the spot rate with changes in the investment in the foreign operation due to movements in the spot rate (the offset method). Acadian's policy is to hedge the net investment only to the extent of the debt principal. There was no ineffectiveness to be recorded from the hedge during the quarter.

   The change in the carrying amount of long-term debt as a result of foreign currency movements during the quarter, as recognized in OCI, and the change in the hedged item was $0.3 million and $(3.5) million for the three months and nine months ended September 26, 2026 (September 27, 2025 - $(2.1) million and $3.6 million).

   Interest Rate Risk

   Acadian's interest rate risk exposure arises from its floating interest rate revolving credit facility, to the extent funds are drawn (Note 6). As at September 26, 2026, $1.2 million was drawn (December 31, 2025 - $nil). A change in interest rates would have no impact on the fixed interest rate Term Facilities or Equipment Loan.

   Liquidity Risk

   Acadian's principal sources of liquidity include cash earned from operations and cash available under its revolving facilities as disclosed in Note 6. These sources, combined with existing cash, are expected to allow Acadian to meet its short term and long-term operating, debt service, capital expenditure and dividend requirements. A portion of long-term debt totaling $45.3 million is scheduled to mature March 6, 2027 as disclosed in Note 6. It is management's intention to refinance the debt prior

   to the maturity date.

   Additionally, Acadian assesses the nature and timing of discretionary payments, including dividend payments to shareholders, in an effort to mitigate any impact on the financial condition or results of operations of Acadian.

5. INCOME TAXES

   The components of income taxes recognized in profit or loss are as follows:

   Three Months Ended Nine Months Ended

   	September	September	September	September
   (CAD thousands)	26, 2026	27, 2025	26, 2026	27, 2025
   Current income tax expense	$ 743	$ 1,125	$ 1,817	$ 1,888
   Deferred income tax expense	1,008	(954)	4,102	712
   Total income tax expense	$ 1,751	$ 171	$ 5,919	$ 2,600

   Acadian's effective tax rate is different from the domestic statutory income tax rate due to the differences set out below:

   Three Months Ended Nine Months Ended

   	September	September	September	September
   (CAD thousands)	26, 2026	27, 2025	26, 2026	27, 2025
   Income taxes at statutory rate	$ 1,779	$ 898	$ 4,375	$ 3,438
   Foreign tax rate differential	(16)	8	(23)	28
   Changes in estimates related to prior years	-	(799)	1,549	(958)
   Other	(12)	64	18	92
   Total income tax expense	$ 1,751	$ 171	$ 5,919	$ 2,600

6. DIVIDENDS TO SHAREHOLDERS

Acadian pays quarterly dividends to the extent determined prudent by the Board of Directors. Total dividends declared for the three months and nine months ended September 26, 2026 were $5.4 million and $16.2 million (September 27, 2025 -

$5.3 million and $15.6 million) or $0.29 and $0.87 per share (September 27, 2025 - $0.29 and $0.87 per share).

BOARD OF DIRECTORS MANAGEMENT HEAD OFFICE

Malcolm Cockwell Interim President and Chief Executive Officer Acadian Timber Corp.

Bruce Robertson

Corporate Director

Karen Oldfield

Interim President and CEO Nova Scotia Health

Heather Fitzpatrick

President and CEO

Halmont Properties Corporation

Erika Reilly

Corporate Director

Malcolm Cockwell Interim President and Chief Executive Officer Acadian Timber Corp.

Susan Wood

Chief Financial Officer Acadian Timber Corp.

6 Crabtree Ave. Edmundston, N.B. E3V 3K5

Please direct your inquiries to:

Susan Wood

Chief Financial Officer

t. 506-737-2345

e. [email protected]

TRANSFER AGENT AND REGISTRAR

Shareholder inquiries relating to dividends, address changes and shareholder account information should be directed to the Company's transfer agent:

TSX Trust Company

1701 - 1190 Avenue des Canadiens-de-Montréal Montreal, QC H3B 0G7

t. 1-800-387-0825 (toll free in North America) or 416-682-3860

f. 1-416-361-0470

e. [email protected] https://www.tsxtrust.com

https://www.acadiantimber.com

SHARE INFORMATION

Toronto Stock Exchange: ADN

Fully Diluted Shares Outstanding (September 26, 2026): 18,780,533 Targeted 2026 Quarterly Dividend: $0.29 per share

Record Date: Last business day of each quarter

Payment Date: On or about the 15th day of each subsequent month

6 Crabtree Ave. Edmundston, NB E3V 3K5

acadiantimber.com