Company Announcements

TORONTO--(BUSINESS WIRE)--May 5, 2026-- GreenFirst Forest Products Inc. (TSX: GFP) (“GreenFirst” or the “Company”) announced results for the first quarter ended March 28, 2026. The Company’s unaudited condensed consolidated financial statements ("Financial Statements") and related Management's Discussion and Analysis ("MD&A") for the first quarter ended March 28, 2026 are available on GreenFirst’s website at www.greenfirst.ca and on SEDAR+ at www.sedarplus.ca.

Highlights

• Q1 2026 net loss from continuing operations was $20.7 million or $0.89 loss per share (diluted), compared to net loss of $32.8 million or $1.43 loss per share (diluted) in Q4 2025. Adjusted EBITDA from continuing operations for Q1 2026 was negative $15.1 million compared to negative $21.7 million in Q4 2025.
• Benchmark prices saw increases during the quarter which resulted in an average realized lumber prices of $666/mfbm for Q1 2026 which was higher than the $654/mfbm pricing realized in Q4 2025.
• On January 21, 2026, the Company entered into a $30 million term loan under the Softwood Lumber Program announced by the Government of Canada. The financing, arranged with the Company’s banking partner BMO, is intended to support liquidity and ongoing operations amid continued market volatility in the North American lumber sector.

GreenFirst Reports Q1 2026 Results Impacted by Market Conditions and Operational Disruptions; Pricing and Operations Improve Through Quarter

“Q1 2026 results were impacted by temporary mill curtailments in January and logistical disruptions related to winter weather conditions across parts of Canada and the northeastern United States, consistent with typical seasonal variability in the first quarter. These factors affected both production and shipments, resulting in lower sales volumes compared to Q4 2025.

Market conditions evolved positively over the course of the quarter. Western Benchmark lumber prices increased during the period, supported by improved demand. While pricing momentum was encouraging, volatility remains a characteristic of our markets, and we continue to take a prudent near-term view.

Operationally, winter conditions supported a productive log harvesting season, positioning our fibre supply well for 2026. At Chapleau, we continue to advance the ramp-up of the new line, with production increasing sequentially through the quarter. We expect further progress in Q2 2026 as we continue to optimize performance.

Our focus remains on disciplined execution, cost control, and prudent capital allocation. We believe the steps taken over the past year strengthen our operating platform and position the Company to benefit as market conditions improve," said Joel Fournier, CEO of GreenFirst.

Financial Highlights

The following selected financial information is from the Company’s financial statements and MD&A:

Net sales were $60.6 million in Q1 2026, a decrease of approximately 21% compared to Q4 2025. The decrease in net sales was primarily driven by lower shipments, partially offset by higher realized pricing during the quarter. The decline in shipments reflected softer market conditions and lower production impacted by temporary January curtailments, weather-related logistical disruptions across parts of Canada and the northeastern United States, downtime associated with the Chapleau large log line installation, and scheduled maintenance.

Cost of sales were $62.6 million in Q1 2026, a decrease of approximately 27% compared to Q4 2025. This decrease was primarily due to lower shipment volumes, partially offset by higher per unit production costs associated with reduced operating leverage and planned downtime. Cost of sales in the quarter also included a $1.8 million provision for net realizable value adjustments on inventory compared to a $10.2 million provision in the fourth quarter of 2025, primarily reflecting higher log volumes from harvesting activities during the first quarter of 2026 and higher unit costs resulting from reduced operating throughput and lower absorption of fixed costs across the mill network. This is offset by slight increases in benchmark lumber prices. During March 2026, U.S. benchmark lumber prices for delivery to Great Lakes region for 2x4 2&better random length and studs were US$579/mfbm and $US493/mfbm, respectively.

Other Expenses

Duties and tariffs expense of $12.1 million in the first quarter of 2026 was lower than the fourth quarter of 2025 of $15.1 million. The decrease reflected lower shipment volumes partially offset by higher applicable combined duty and tariff rates during the first quarter of 2026. The Company was subject to a combined duty rate of 35.16%, which increased to 45.16% effective October 14, 2025 following the implementation of Section 232 tariffs.

SG&A expenses were $4.4 million in the first quarter of 2026, an increase compared to the fourth quarter of 2025, which was primarily due to reversal of accruals no longer required on sale of assets and the reversal of accrued bonuses in the fourth quarter of 2025.

Liquidity and Borrowings

At March 28, 2026, the Company had $6.5 million in cash on hand (December 31, 2025 - $3.5 million). In addition, the Company had $14.3 million of excess availability under the revolving credit facility (net of $28.0 million drawn and $3.9 million for standby letters of credit) compared to $23.1 million as at December 31, 2025 (net of $18.0 million drawn and $3.9 million for standby letters of credit). The Company also had access to $14.8 million under its equipment financing agreement (December 31, 2025 - $14.1 million) of which $10.2 million was drawn as at March 28, 2026 (December 31, 2025 - $10.9 million).

Outlook

The outlook for the North American lumber industry reflects ongoing macroeconomic uncertainty, but long-term demand fundamentals remain supportive. Lumber demand is closely tied to residential construction activity in the United States, the primary end market for Canadian softwood lumber producers. Inflationary pressures have moderated, and interest rates may gradually ease. However, housing affordability challenges and broader economic uncertainty continue to weigh on near-term activity. Recent geopolitical tensions in the Middle East, including the ongoing conflict involving Iran and the United States, have contributed to increased volatility in global energy markets and heightened macroeconomic uncertainty. Elevated and potentially volatile energy prices may place upward pressure on transportation and input costs, while also contributing to broader inflationary pressures that could further impact consumer demand and housing affordability. As a result, demand for lumber products may remain below mid-cycle levels. Still, improving financial conditions could support a gradual recovery in residential construction, repair, and renovation activity over time.

U.S. housing starts are widely viewed as a key indicator of lumber demand. Industry participants generally consider annual housing starts of approximately 1.4 to 1.6 million units to represent normalized long-term demand levels. Recently, housing starts have remained below these levels due to higher mortgage rates and affordability constraints. In addition to new construction, repair and renovation activity represents a significant portion of lumber demand. Historically, it has accounted for around 40–45% of total wood products consumption. Demand in this segment tends to be more stable than new construction and can help partially offset cyclical fluctuations in housing starts.

Despite near-term uncertainties, the longer-term demand outlook for lumber remains supported by structural housing market dynamics. The United States continues to face a significant housing supply deficit. Combined with an aging housing stock and demographic-driven household formation, these factors are expected to support demand for wood products over the longer term. Nonetheless, housing activity and lumber demand are likely to remain sensitive to changes in mortgage rates, employment levels, and overall economic conditions.

On the supply side, the North American lumber industry faces structural pressures related to timber availability, regulatory harvest limits, and wildfire impacts, particularly in Western Canada and in the Province of Quebec. These factors have contributed to permanent mill closures, production curtailments, and reduced harvesting levels across parts of the industry. Several producers have adjusted operating plans and curtailed production in response to weak market conditions and ongoing economic uncertainty. This reflects a disciplined approach to balancing supply with demand. While many supply constraints are concentrated in Western provinces, broader fibre availability and transportation dynamics can mainly influence the Canadian lumber supply chain more broadly. Fibre supply conditions vary by region. Certain jurisdictions, including Ontario where GreenFirst operates, continue to maintain relatively stable timber availability. This supports operational continuity and supply reliability.

Labour availability, transportation constraints, energy costs, and inflationary pressures continue to influence operating costs across the forestry sector. These factors, combined with tight fibre supply in certain regions, may affect production levels and margins. At the same time, ongoing investments in mill modernization, automation, and process optimization are enabling producers to improve operating efficiency and enhance long-term competitiveness.

Canadian softwood lumber exports to the United States continue to be subject to anti-dumping and countervailing duties under the longstanding Canada–U.S. softwood lumber trade dispute. These duties, together with other potential trade measures and currency fluctuations, influence the competitive dynamics and profitability of Canadian lumber producers. The magnitude and timing of future duty rate adjustments or additional trade actions remain uncertain.

Environmental sustainability and responsible forest management remain important considerations for the industry. Wood products are increasingly recognized as a renewable building material that stores carbon and supports lower-emission construction. Companies that maintain strong environmental practices and sustainable forest management certifications are increasingly well positioned to meet evolving regulatory, investor, and customer expectations.

Lumber markets have historically been characterized by significant price volatility. This reflects the cyclical nature of residential construction activity, changing economic conditions, and shifts in supply and demand across the global wood products industry. Lumber prices can fluctuate materially over short periods in response to housing starts, interest rates, industry production levels, inventory levels throughout the supply chain, and broader macroeconomic developments. As a result, producers often adjust production levels and operating plans to manage inventories and maintain operational efficiency.

Overall, the industry continues to face cyclical and macroeconomic challenges, including housing affordability pressures, trade policy uncertainty, and supply constraints. However, the long-term outlook for lumber demand remains supported by structural housing needs, population growth, and the increasing use of wood as a sustainable building material. GreenFirst’s stable Ontario fibre supply, strategic mill locations, sustainable operations, and ongoing investments in operational efficiency position the Company to navigate cyclical market conditions, enhance resilience, and create long-term value for stakeholders.

Actual market conditions may differ materially from current expectations due to changes in economic conditions, housing demand, trade policies, or other factors affecting the global wood products industry.

Reconciliation of Adjusted EBITDA

References to EBITDA in this document are measures of earnings (loss) before interest and finance costs, income taxes, depreciation and amortization, while references to Adjusted EBITDA reflect EBITDA plus other non-operating costs such as impact of valuation changes on the Company's investments, loss on sale of assets and other non-operating losses. Management believes that certain lenders, investors, and analysts use EBITDA and Adjusted EBITDA as a common valuation measurement and to measure the Company’s ability to service debt and meet other payment obligations. EBITDA and Adjusted EBITDA are not intended to replace net earnings (loss), or other measures of financial performance and liquidity reported in accordance with GAAP. For more information on non-GAAP measures, please see the Company's MD&A.

Earnings Conference Call

GreenFirst will host a conference call to review the Q1 2026 financial results on Wednesday, May 6, 2026 at 9:00am (Eastern). The live webcast of the earnings conference call can be accessed via web: http://momentum.adobeconnect.com/greenfirstq12026/ and via phone: (+1) 289 514 5100 or (+1) 800 717 1738. A replay of the webcast and presentation slides will be available on GreenFirst’s website following the conference call.

About GreenFirst

GreenFirst Forest Products is a forest-first business, focused on sustainable forest management and lumber production. The Company owns four sawmills located in rich wood baskets proudly operating over six million hectares of FSC® certified public Ontario forest lands (FSC®-C167905). The Company believes that responsible forest practices, coupled with the long-term green advantage of lumber, provide GreenFirst with significant cyclical and secular advantages in building products.

Forward Looking Information

Certain information in this news release constitutes forward-looking statements under applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact are forward-looking statements. Forward looking statements are often identified by terms such as “may”, “should”, “anticipate”, “expect”, “potential”, “believe”, “intend”, “estimate” or the negative of these terms and similar expressions. Forward-looking statements are based on certain assumptions and, while GreenFirst considers these assumptions to be reasonable, based on information currently available, they may prove to be incorrect. In addition, forward-looking statements necessarily involve known and unknown risks, including those set out in GreenFirst’s public disclosure record filed under its profile on www.sedarplus.ca. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. GreenFirst disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

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For more information, please visit: www.greenfirst.ca or contact Investor Relations (416) 775 2821

Source: GreenFirst Forest Products Inc.