ADN: Desk Presentation Highlights

Research evidence excerpt

ADN: Desk Presentation Highlights

Acadian Timber Corp.

Target/Upside/Downside Scenarios Investment summary

We like Acadian’s high dividend yield and solid balance sheet,Acadian Timber Corp.

but see more compelling opportunities in our coverage group

22 125 Weeks 16JAN24 - 08JUN26 at present. However, we believe Acadian is likely to generate

20 investor interest with rising overall interest in timberlands

TARGETTARGET 18.0018.00

18 CURRENTCURRENT 17.3017.30 investments and alternative uses for land (leasing to solar/

16 wind projects, forest carbon opportunities, etc.).

12 For now, Acadian’s primary focus remains on cost control,

10 maintaining contractor capacity in New Brunswick while

8 managing its own harvesting operations in Maine, and

400k achieving operational excellence at existing operations.

300k

200k

100k

2024 2025 2026

J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J Risks to rating and price target

ADN CN Rel. S&P/TSX COMP IDX MA 40 weeks • Dependence on housing and construction markets:

Source: Bloomberg and RBC Capital Markets estimates for Target Demand for logs and wood products is primarily affected

Valuation by the level of new residential construction activity. A

decline in activity would negatively impact lumber mills,Our $18 price target is based on a ~17x blended EBITDA

which are important customers for Acadian. Lumbermultiple on our Trend EBITDA of $25.0MM (85%) and our

capacity reductions in New Brunswick as a result of2026E EBITDA of $29.6MM (15%). Our valuation multiple,

duties and tariffs could also negatively affect demand forwhich is a moderate discount to what we apply to premium-

sawtimber. Conversely, stronger-than-expected residentialvalued peers given relatively smaller size, also reflects