NORTH BAY, Ontario (News release) -- GreenFirst Forest Products Inc. announced results for the second quarter and two quarters ended June 27, 2026. The Company's unaudited condensed consolidated financial statements ("Financial Statements") and related Management's Discussion and Analysis ("MD&A") for the second quarter and two quarters ended June 27, 2026 are available on GreenFirst's website at www.greenfirst.ca and on SEDAR+ at www.sedarplus.ca.

Highlights

• Q2 2026 net income was $5.5 million or $0.24 earning per share (diluted), compared to net loss of $20.7 million or $0.89 loss per share (diluted) in Q1 2026. Adjusted EBITDA for Q2 2026 was positive $11.8 million compared to negative $15.1 million in Q1 2026.
• Average realized lumber prices increased to $764/mfbm in Q2 2026, compared to $666/mfbm in Q1 2026, reflecting stronger benchmark lumber markets and improved pricing conditions during the quarter.
• GreenFirst announces the resignation of CEO, Joel Fournier effective October 31, 2026.

GreenFirst Reported Positive EBITDA of $11.8 Million and Net Earnings of $5.5 Million

"The second quarter represents an important step forward for GreenFirst. We delivered positive EBITDA and earnings while significantly increasing sales volumes and lowering manufacturing costs.

These results reflect increases in our realized average selling price to $764/mfbm as a result of improved market conditions and improved lumber grade mix. At the same time, total manufacturing costs improved by 10% compared with the previous quarter, reflecting increased production volumes and stronger operational performance across our operations, particularly the ongoing optimization of the Chapleau large log line. Additionally, the quarter also benefitted from significant inventory valuation reversal reflecting stronger lumber prices, lower inventory levels and more favorable inventory mix consisting of a higher proportion of premium products at quarter-end.

Looking ahead, our priorities remain clear: continue improving operational reliability, lower manufacturing costs through increased production and productivity, strengthen free cash flow, and position GreenFirst to generate sustainable earnings throughout the lumber cycle," 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 $96.1 million in Q2 2026, an increase of approximately 59% compared to Q1 2026. The increase in net sales was primarily driven by higher shipments and higher realized pricing during the quarter, despite continued pressure from elevated duties and tariffs applicable to Canadian softwood lumber exports. The increase in realized pricing reflects stronger market conditions during the quarter, due to tighter North American supply resulting from production curtailments and mill closures, combined with lean channel inventories and stable underlying demand.

Cost of sales were $62.1 million in Q2 2026, a decrease of approximately 1% compared to Q1 2026. Cost of sales remained relatively consistent despite a significant increase in shipment volumes, primarily due to a $16.2 million reversal of the net realizable value inventory provision, compared to a $1.8 million provision recorded in the first quarter of 2026. The reversal reflected stronger lumber prices, lower inventory levels and more favorable inventory mix at quarter-end. At Chapleau, the Company continued commissioning and optimization activities associated with the new large log line with production levels improving during the quarter.

Other Expenses

Duties and tariffs expense of $21.1 million in the second quarter of 2026 was higher than the first quarter of 2026 of $12.1 million. The increase primarily reflected higher shipment volumes and higher lumber selling prices during the quarter. 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 $4.3 million in the second quarter of 2026 which remained relatively flat to the first quarter of 2026 of $4.4 million.

Liquidity and Borrowings

At June 27, 2026, the Company had $2.8 million in cash on hand (December 31, 2025 - $3.5 million). In addition, the Company had 24.4 million of excess availability under the revolving credit facility (net of $24.0 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 $15.6 million under its equipment financing agreement (December 31, 2025 - $14.1 million) of which $9.4 million was drawn as at June 27, 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 remain volatile, 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 have placed 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 positive and is 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.

CEO Transition Plan

GreenFirst wishes to announce that Joel Fournier has tendered his resignation as CEO of GreenFirst for personal reasons. Mr. Fournier will continue in his current role until October 31, 2026 to ensure there is a seamless transition. GreenFirst will commence a search process for the new CEO and will keep the market updated.

Paul Rivett, Chairman of GreenFirst said, "On behalf of the Board of Directors, I would like to thank Joel for his leadership and contributions during the last three years and wish for his continued success in the next phase of his career."

Joel Fournier said, "I am proud of what we have accomplished together during my time at GreenFirst and of the progress the organization has made through a challenging period for our industry. We achieved exceptional safety results, reduced manufacturing costs across our mills, improved product quality and achieved multiple production records over the past three years. These accomplishments reflect the commitment and dedication of our people, and it has been a privilege to work alongside such a strong team. I would also like to thank the Board for the opportunity to lead GreenFirst and for their support during my tenure. I remain confident in GreenFirst's people, assets and long-term potential, and I am committed to supporting a smooth transition and ensuring continuity. I wish the entire GreenFirst team continued success."