CALGARY, AB--(Marketwired - March 10, 2016) - Canexus Corporation (CUS.TO) (the "Corporation" or "Canexus") today announced its financial results for the fourth quarter and year-ended December 31, 2015.

Highlights

• Cash Operating Profit ("COP") was $104.7 million for the year ended December 31, 2015 ($95.3 million for the year ended December 31, 2014), including $10.4 million in one-time costs. These strong results reflect record COP results for the North American Sodium Chlorate and South America business units.

• In 2015, our Business Improvement Program ("BIP") improved total cost operating profit by $12.9 million and reduced working capital by $12.0 million, compared to 2014, through a number of initiatives to improve the operating performance of the Corporation. The results exceeded targets set when the project was initiated in March 2015 and are estimated to generate an annual run-rate improvement of $15.6 million.

• Maintenance capital was $25.6 million for 2015 which was in-line with expectations. We continue to target a 3-year maintenance capital average of $25.0M.

• The caustic modernization project was completed on-time and came in below budget. Annual savings from this project are expected to be approximately $3.5 million.

• As previously announced on October 6, 2015, Canexus has entered into an arrangement agreement (the "Transaction") with Superior Plus Corp. ("Superior"), pursuant to which Superior has agreed to acquire all of the issued and outstanding common shares of Canexus ("Canexus Shares"), payable in common shares of Superior ("Superior Shares") at an exchange ratio of 0.153 Superior Shares for each Canexus Share. Closing of the transaction is pending regulatory approval. We still expect to close the Transaction in the first half of 2016. On December 11, 2015, 99.19% of shareholders voted in favour of the Transaction.

• The Board of Directors declared a quarterly dividend of $0.01 per common share payable April 15, 2016 to shareholders of record on March 31, 2016.

Financial Results

COP was $23.7 million for the quarter ended December 31, 2015, including $3.4M of one-time costs largely related to the Transaction (Q3/15 - $24.0 million; Q4/14 - $23.8 million). Our Q4/15 results remained in line with Q3/15. Compared to the prior quarter, chlorate sales volumes remained solid, the weak Canadian dollar persisted, hyrdrochloric acid demand and pricing were relatively stable, higher caustic soda prices offset lower chlorine sales volumes and South America performance was solid. Q4/15 compared to the Q4/14 was also consistent as strong chlorate sales volumes and a weakening dollar offset poor hydrochloric market conditions due to reduced oil and gas hydraulic fracturing activity. In Q4/15 Canexus recorded $58 million of non-cash impairment charges in the fourth quarter. Impairment charges were recorded on our North American Chlor-alkali ("NACA") facility at North Vancouver due to reduced demand and pricing for hydrochloric acid ("HCl") expected in the foreseeable future primarily stemming from reduced demand in the oil and gas sector.

Looking at the full year, 2015 was incredibly strong given the market headwinds experienced by our North American chlor-alkali business unit. The Corporation maximized the benefit of a significant uplift from the weakening Canadian dollar. Record production sales volumes were experienced at our North American Sodium Chlorate business unit of 381,000 MTs, reflecting a 5% improvement over 2014. South America sales volumes were also maintained at optimal rates as usage from our main customer remained strong. The performance of North American Sodium Chlorate and South America more than offset lower hydrochloric acid demand and prices, lower caustic sales volumes and the compressor malfunction at North Vancouver. In 2015, realized losses from foreign currency hedging contracts were $5.3 million. Downside risk was protected by our standing internal mandate to hedge a maximum of 50% of our total US dollar cash exposure.

In 2015, costs and margins were effectively managed through our BIP resulting in approximately $2.9 million in revenue and margin improvements, $1.7 million in operational efficiencies, and $8.3 million in G&A reduction. In 2015, total COP improvement was $12.9 million, which translates into $15.6 million on an annualized run-rate basis. Capital spending was also controlled through the implementation of new approval and tracking processes. We completed the caustic modernization and anode refurbishment projects at our North Vancouver facility on-time and under-budget. Maintenance capital was in line with our 3-year average target of $25 million.

At December 31, 2015, the Corporation had approximately $34.2 million of available liquidity under our revolving credit facility. A request has been made to the banking syndicate to amend the current bank facility to further relax financial covenants to provide the Company with flexibility and an appropriate level of liquidity until the expected closing of the transaction with Superior Plus. There can be no certainty that any amendments will be successfully negotiated on terms satisfactory to Canexus, if at all.

Business Unit Results

North American Sodium Chlorate

Canexus' North American Sodium Chlorate business continued record breaking performance in Q4/15. Record COP of $20.1 million (Q3/15 - $19.6 million; Q4/14 - $13.8 million) was achieved. We experienced higher realized prices from our US customers in the fourth quarter given the devaluation of the Canadian dollar relative to the US dollar, with approximately two-thirds of our sales volume exported to the US. Sodium chlorate market prices in Q4/15 were relatively flat to the prior quarter. North American sodium chlorate industry operating rates were approximately 93% percent following the closure of a competitor's plant in the southeastern US in early December.

North American Chlor-alkali

Canexus' North American Chlor-alkali business had a COP of $4.1 million for the quarter (Q3/15 - $0.6 million loss; Q4/14 - $7.4 million profit). The North American chlor-alkali operating rate declined to 80% in Q4, an expected decline and consistent with seasonal demand reduction and planned production outages. The decrease in caustic soda production was offset by lower seasonal demand and export shipments. Metric electrochemical unit pricing in Q4 increased as the result of a caustic price increase implementation in the quarter.

Conversely, North American hydrochloric acid demand continued to be under pressure during the quarter. The precipitous decline in global crude prices has severely impacted drilling activity and the need for hydrochloric acid used in the fracturing process. Canexus acid sales volumes declined 27% in 2015, compared to 2014. North American acid production has been reduced to address the new realities in the oil and gas industry, however by-product acid production increased in Q4 following planned and unplanned outages.

The North Vancouver plant will continue to operate at reduced capacity due to a compressor outage caused by mechanical failure in Q3/15. The Corporation continues to proceed with Business Interruption and Property Claims under its insurance policies and indications are that these will likely be covered claims. Production capacity is expected to be approximately 70% until early May 2016 when repairs are planned to be completed and full production capacity is expected to be available.

South America

Canexus' Brazil operations generated COP of $6.1 million in the quarter (Q3/15 - $7.5 million; Q4/14 - $6.0 million). Brazil's operations continue to be highly stable with our primary customer running at high rates, resulting in strong demand for our products which are sold under a long-term, cost plus, fixed US dollar margin contract. This business is also experiencing positive uplift from the devaluation of the Canadian dollar and the Brazilian Real as compared to the US dollar, as well as lower purchased product and fixed costs.

Transaction Update

On October 6, 2015, Canexus announced it had entered into an arrangement agreement whereby Superior would acquire all the issued and outstanding common shares of Canexus by way of a court approved plan of arrangement. Under terms of the arrangement, Canexus shareholders will receive 0.153 of a Superior common share for each Canexus common share. On December 11, 2015, 99.19% of Canexus shareholders voted in favour of the transaction. The transaction is subject to receipt of regulatory approval and the satisfaction of certain other commercial conditions. The transaction is anticipated to close in the first half of 2016.

At the time that the Transaction is closed, a change of control will be triggered and Superior will be required to make an offer in writing within 30 days of the closing date to purchase all of the then outstanding 5.75% convertible unsecured subordinated Series IV debentures (the "Series IV Debentures") at 101% of principal amount and the 6.00% convertible unsecured subordinated Series V and the 6.50% convertible unsecured subordinated VI debentures at 100% of principal amount, amount plus accrued and unpaid interest; provided that in the case of the Series IV Debentures Superior may elect to redeem the Series IV Debentures equal to the greater of 101% of the principal amount or the Canada Yield Price (as defined in the debenture indenture pertaining to such debentures), together with accrued and unpaid interest.

Conference Call

Canexus will hold a conference call on March 11, 2016 at 8:30 am MT (10:30 am ET) to discuss Canexus' fourth quarter 2015 financial results. A news release will be issued the evening before the call. Financial Statements and Management's Discussion and Analysis will be posted on the Canexus website at www.canexus.ca and filed on SEDAR.

The call will be hosted by Doug Wonnacott, President and Chief Executive Officer; Dean Beacon, Senior Vice President, Finance and Chief Financial Officer; Brian Bourgeois, Senior Vice President Sales and Marketing; and Ross Wonnick, Vice President, General Counsel and Corporate Secretary. Following the call there will be a question and answer session for analysts and institutional investors.

To access the call, please dial 1-416-340-8010 or 1-866-226-1792 outside Canada and USA. A replay of the conference call will be available until end of day ET on March 18, 2016. To access the replay call 1-905-694-9451 or 1-800-408-3053 outside Canada and USA, followed by passcode 4138026#.

Financial Results

Segmented Information for the Three Months Ended December 31, 2015 and 2014

Canexus has a total of six electrochemical manufacturing plants - four in Canada and two at one site in Brazil - organized into three business units. Below is our fourth quarter performance by segment.

See footnotes on the following page.

Notes:

1. The North America Sodium Chlorate operating segment (i) sells sodium chlorate at market rates to the South America operating segment and
   (ii) provides transloading services at market rates to the NACA operating segment for caustic soda transloaded from barges into trucks for delivery to NACA customers that are eliminated for financial reporting purposes.

1. NATO charged transloading fees (approximating market rates charged by third party terminals) to the NACA operating segment for hydrochloric acid and caustic soda transloaded from railcars into trucks for delivery to NACA customers that are eliminated for financial reporting purposes

Operating Results for the Three Months and Years Ended December 31, 2015 and 2014

Notes:

1. Depreciation and Amortization included in the three months and year ended December 31, 2015 - $11.6 million and $45.8 million, respectively (three months and year ended December 31, 2014 - $13.6 million and $48.4 million, respectively)

2. Depreciation and Amortization included for the three and nine months ended December 31, 2015 - $0.2 million and $0.8 million, respectively (three months and year ended December 31, 2014 - $0.3 million and $1.2 million, respectively)

Adjusted Cash Operating Profit

Notes:

1. Cash Operating Profit (Loss) and Adjusted Cash Operating Profit ("ACOP") are non-GAAP measures. See "Non-GAAP Measures".

2. Cash Operating Profit from Operating Segments is Operating Profit from North America Sodium Chlorate, NACA and South America, excluding depreciation and amortization. Cash Operating Profit (Loss) from Corporate is Operating Profit (Loss) from corporate segment, excluding depreciation and amortization and share-based compensation.

3. Other Costs are comprised of expenses related to the Arrangement Agreement with Superior Plus Corp., severance, salt inventory adjustments, the Board's review of strategic alternatives, and certain litigation.

About Canexus

Canexus produces sodium chlorate and chlor-alkali products largely for the pulp and paper and water treatment industries. Our four plants in Canada and two at one site in Brazil are reliable, low-cost, strategically located facilities that capitalize on competitive electricity costs and transportation infrastructure to minimize production and delivery costs. Canexus targets opportunities to maximize shareholder returns and delivers high-quality products to its customers and is committed to Responsible Care^® through safe operating practices. Canexus' common shares (CUS) and debentures (Series III - CUS.DB.A; Series IV - CUS.DB.B; Series V - CUS.DB.C; Series VI - CUS.DB.D) trade on the Toronto Stock Exchange. More information about Canexus is available at www.canexus.ca.

Non-GAAP Measures

Cash operating profit, cash operating profit percentage, and adjusted cash operating profit are financial measures not determined in accordance with generally accepted accounting principles for publicly accountable enterprises in Canada ("GAAP"), but management believes they are useful in measuring the Corporation's performance. Readers are cautioned that these measures should not be construed as alternatives to net income or loss or other comparable measures determined in accordance with GAAP as an indicator of the Corporation's performance or as a measure of the Corporation's liquidity and cash flow. The Corporation's method of calculating non-GAAP measures may differ from the methods used by other issuers and accordingly, the Corporation's non-GAAP measures are unlikely to be comparable to similarly titled measures used by other issuers. Cash operating profit is adjusted for interest expense, cash income tax expense and realized losses on foreign currency hedging contracts to calculate adjusted cash operating profit. Readers should consult the Corporation's Management's Discussion & Analysis for the year ended December 31, 2015 filed on SEDAR for a complete explanation of how the Corporation calculates each of the other non-GAAP measures.

Forward-Looking Statements

This news release contains forward-looking statements and information relating to expected future events and financial and operating results of the Corporation and its subsidiaries, including with respect to: expectations for the completion of, and the efficiencies to be gained as a result of, the Transaction, including reduced costs and enhanced synergies; expectations for operational flexibility, expected capacity constraints at North Vancouver and the timing of compressor repair at the North Vancouver plant; expected successful negotiation of a covenant amendment and its impact on liquidity; expectations for savings as a result of the caustic modernization project; expectations for HCl demand and pricing; expectations for the oil & gas sector; . The use of the words "expects", "anticipates", "continue", "estimates", "projects", "should", "believe", "plans", "intends", "may", "will" or similar expressions are intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in such forward-looking statements for a variety of reasons, including market and general economic conditions, future costs, treatment under governmental regulatory, tax and environmental regimes and the other risks and uncertainties detailed under "Risk Factors" in the Corporation's Annual Information Form filed on the Corporation's SEDAR profile at www.sedar.com. Management believes the expectations reflected in these forward-looking statements are currently reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Due to the potential impact of these factors, the Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law. Any financial outlook information contained in this news release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on Management's assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this news release should not be used for purposes other than those for which it is disclosed herein.