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¹ This news release makes reference 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). Reference made to “Payout Ratio” is defined as dividends declared divided by Free Cash Flow and “Payout Ratio with DRIP” is defined as dividends paid in cash divided by Free Cash Flow. Management believes that Adjusted EBITDA, Adjusted EBITDA margin, Free Cash Flow, and Payout Ratios are key performance measures in evaluating Acadian’s operations and are important in enhancing investors’ understanding of the Company’s operating 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 our operations that are available for dividends, repurchases of common shares, debt reduction, acquisitions, and other capital allocation activities. Payout Ratios are used to evaluate Acadian’s ability to fund its distribution using Free Cash Flow. 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. Please refer to the section entitled “Non-IFRS Measures” in Management’s Discussion and Analysis for further details.

Review of Operations

Financial and Operating Highlights

During the first quarter, Acadian generated total sales of $24.8 million, compared to $28.8 million in the prior year period. The first quarter of 2024 included $4.9 million in carbon credit sales, while no carbon credit sales occurred in the first quarter of 2025.

Timber sales and services revenue increased by $1.0 million year-over-year as a result of increased timber sales volumes and increased timber services activity, partially offset by a decrease in the weighted average selling price of timber. Timber sales volume, excluding biomass, increased 3% as compared to the first quarter of 2024, supported by stable demand. However, unfavourable weather conditions in New Brunswick and Maine hindered trucking activities. Volumes in Maine were further impacted by continued limited contractor capacity. Timber services revenue increased 55%, as compared to the first quarter of 2024, due to timing of activity across quarters. Biomass sales volume increased 100% from the prior year period due to increased processing capacity.

Weighted average selling price, excluding biomass, decreased 5% year-over-year. Sawlog prices decreased due to changes in product mix and weakness in lumber markets. Softwood pulpwood pricing decreased due to lower demand, while hardwood pulpwood pricing increased due to longer hauling distances.

Operating costs and expenses were $20.4 million during the first quarter, compared to $21.2 million during the prior year period. The year-over-year decrease reflects an increase in operating costs and expenses related to timber sales and services of $2.2 million, offset by a decrease in costs related to carbon credit sales of $3.0 million. Operating costs and expenses related to timber sales and services increased as a result of higher timber sales volumes and higher timber services activity, as well as transition costs associated with the establishment of our own logging operations in Maine.

Adjusted EBITDA was $4.7 million during the first quarter compared to $10.6 million in the prior year period. Included in the Adjusted EBITDA in the prior year period was $4.1 million related to carbon credit sales. Adjusted EBITDA margin for the quarter was 19% compared to 37% in the prior year period. Free Cash Flow was $3.0 million compared to $7.8 million in the prior year period.

Net income for the first quarter totaled $3.7 million, or $0.21 per share, compared to net income of $6.0 million, or $0.35 per share in the same period of 2024. Lower operating income and lower non-cash fair value adjustments were partially offset by lower income tax expense, as compared to the prior year period.

Segment Performance

New Brunswick Timberlands

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

Sales for New Brunswick Timberlands were $22.1 million compared to $19.1 million during the prior year period, with increased sales volumes and higher timber services activity partially offset by a lower weighted average selling price. Sales volume, excluding biomass, increased 15% due primarily to strong demand for sawlogs. Softwood sawlog and hardwood sawlog sales volumes increased 15% and 40%, respectively, and softwood pulpwood and hardwood pulpwood sales volumes increased 9% and 11%, respectively. Biomass sales volume increased 100% from the prior year period due to increased processing capacity.

The weighted average selling price, excluding biomass, for the first quarter was $81.51 per m³, or 3% lower than the prior year period. Sawlog prices decreased due to changes in product mix and weakness in lumber markets. Softwood pulpwood pricing decreased due to lower demand, while hardwood pulpwood pricing increased due to longer hauling distances.

Operating costs and expenses were $16.3 million during the first quarter, compared to $13.2 million in the prior year period as a result of increased harvesting and timber services activity and increased weighted average variable costs. Weighted average variable costs, excluding biomass, increased 2% due to higher contractor costs compared to the prior year period.

Adjusted EBITDA for the quarter was $5.9 million compared to $6.0 million during the prior year period and Adjusted EBITDA margin was 27% compared to 31%.

Maine Timberlands

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

Sales for Maine Timberlands during the first quarter totaled $2.8 million compared to $4.8 million in the prior year period. Timber sales volume, excluding biomass, decreased 44% primarily due to reduced contractor capacity and unfavourable weather conditions which impacted deliveries.

The weighted average selling price, excluding biomass, in Canadian dollar terms was $89.43 per m³, compared to $95.03 per m³ during the same period of 2024. In U.S. dollar terms, the weighted average selling price, excluding biomass, was $62.35 per m³, compared to $70.48 per m³ in 2024. Softwood sawlog prices decreased due to changes in product mix and weakness in lumber markets while hardwood pulpwood pricing remained relatively consistent with the same quarter of the prior year. Hardwood sawlog and softwood pulpwood volumes were minimal during the quarter.

Operating costs and expenses for the first quarter were $3.6 million, compared to $3.7 million during the same period in 2024. Decreases in costs resulting from lower timber sales volumes were partially offset by transition costs related to the start-up of our own logging operations. See “Internal Logging Operations” section.

Adjusted EBITDA for the quarter was $(0.7) million compared to $1.2 million during the prior year period and Adjusted EBITDA margin was (24)% compared to 24%.

Environmental Solutions

The table below summarizes operating and financial results for Environmental Solutions:

Environmental Solutions leverages the ecological functions of Acadian’s land and the operational expertise of its team to address pressing environmental challenges, such as climate change and biodiversity. In line with these objectives, Acadian has undertaken a voluntary carbon credit project which increases carbon sequestration and provides significant environmental benefits on the portion of our Maine Timberlands that is subject to a working forest conservation easement.

The project is registered on the ACR under the name Anew – Katahdin Forestry Project, and requires balancing harvest and growth, long-term planning, periodic carbon inventory verification, and maintenance of the Acadian’s sustainable forestry certification.

During the first quarter of 2024, an agreement was reached to sell 752,100 carbon credits and the first delivery under this agreement for approximately 152,100 carbon credits occurred in March 2024. No sales occurred during the first quarter of 2025.

The registration process for the second and third tranches of carbon credits for the project is expected to result in approximately 350,000 credits in total and is expected to be completed in the second quarter of 2025. The project is expected to generate an additional 800,000 credits related to reporting periods four through ten. 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.

Outlook

Near-term pressures on end use markets persist and potential tariffs are causing concern among forest products companies in both the U.S. and Canada. However, North American interest rates and inflation are showing signs of easing, and the consensus forecast for U.S. housing starts is steady at approximately 1.37 million starts in 2025, as compared to 1.35 million in 2024. We therefore remain confident that the stability of the northeastern forestry sector, combined with long-term demand for new homes and repair and remodel activity, will support the long-term demand for our products.

We maintained sufficient contractor availability in New Brunswick through the first quarter, which is expected to continue for the remainder of the year. Although tight labour markets in Maine contributed to delays in trucking in the first quarter, we continued harvesting and have a healthy inventory of harvested wood ready to truck as spring road conditions allow. The establishment of our own internal logging operations is expected to alleviate capacity constraints and increase overall production over the course of 2025.

Demand for Acadian’s sawlogs is mainly driven by regional supply and demand. Near-term sawlog demand is expected to remain stable while pricing may remain challenged until end-use markets improve. Demand and pricing for softwood pulpwood is expected to remain at reduced levels in the near term. Demand for hardwood pulpwood began to soften due to elevated inventories at regional sawmills as we exited the quarter, which may affect demand and pricing in the near term.

With respect to voluntary carbon credits, demand and pricing are expected to remain stable. The protocol for developing compliance market carbon credits from managed forests in Canada was finalized during 2024. Acadian is evaluating the opportunities to develop eligible carbon credits that the compliance protocol may present, in conjunction with the opportunities that exist under the voluntary protocols.

Quarterly Dividend

Based on a strong balance sheet and positive outlook for the remainder of the year, Acadian is pleased to announce a dividend of $0.29 per share, payable on July 15, 2025 to shareholders of record June 30, 2025.

Acadian Timber Corp. (“Acadian”) is one of the largest timberland owners in Eastern Canada and the Northeastern U.S. and has a total of approximately 2.4 million acres of land under management. Acadian owns and manages approximately 775,000 acres of freehold timberlands in New Brunswick, 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 primary business is forest management and the production of timber products, including softwood and hardwood sawlogs, pulpwood, and biomass by-products, sold to approximately 90 regional customers. Acadian also focusses on generating income through other opportunities 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 while growing 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.

For further information, please visit our website at www.acadiantimber.com or contact:

Susan Wood
Chief Financial Officer
Tel: 506-737-2345
Email: ir@acadiantimber.com

Cautionary Statement Regarding Forward-Looking Information and Statements

This News Release 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 News Release and includes statements made in the sections entitled “Internal Logging Operations”, “Segmented Performance – Environmental Solutions” and “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 News Release 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 future production volumes and costs associated with internal logging operations which may be impacted by operational efficiency, the regional supply of skilled operators, product demand, pricing and end use markets.

• 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 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 under the heading “Risk Factors” in Annual Report dated February 12, 2025 and in the Annual Information Form dated March 28, 2025 and other filings of Acadian made with securities regulatory authorities, which are available on SEDAR+ at 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 News Release 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 News Release are made as of the date of this News Release 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 News Release. 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.

Acadian Timber Corp.
Consolidated Balance Sheets

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