2010 Goldman Sachs Basic

8/6/2019 2010 Goldman Sachs Basic

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CASCADESGoldman Sachs Basic

Materials Conference

2010

JUNE 2010


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DISCLAIMERCertainstatementsinthispresentation,includingstatementsregardingfutureresultsandperformance,areforwardlookingstatementswithinthemeaningofsecuritieslegislationbasedoncurrentexpectations.Theaccuracyofsuchstatementsissubject toanumberofrisks,uncertaintiesandassumptionsthatmaycauseactualresultstodiffermateriallyfromthoseprojected,including,

butnotlimitedto,theeffectofgeneraleconomicconditions,decreasesindemandfortheCompanysproducts,thepricesandavailabilityofrawmaterials,changesintherelativevaluesofcertaincurrencies,fluctuationsinsellingpricesandadversechangesingeneralmarketandindustryconditions.Thispresentationalsoincludespriceindicesaswellasvarianceandsensitivityanalysesthatareintendedtoprovidethereaderwithabetterunderstandingofthetrendsrelatedtoourbusinessactivities.Theseitemsarebasedonthebestestimates availabletotheCompany.

ThefinancialinformationincludedinthispresentationalsocontainscertaindatathatarenotmeasuresofperformanceunderCanadianGAAP(nonGAAPmeasures).Forexample,theCompanyusesearningsbeforeinterest,taxes,depreciationandamortization(EBITDA)becauseitisthemeasureusedbymanagementtoassesstheoperatingandfinancialperformanceoftheCompanysoperatingsegments.Suchinformationisreconciledtothemost directlycomparablefinancialmeasures,assetforthintheSupplementalInformationonNonGAAPMeasures section

ofourAnnualReport.

Specificitemsaredefinedasitemssuchaschargesforimpairmentofassets,forfacilityormachineclosures,debtrestructuringcharges,gainsorlossesonsalesofbusinessunits,unrealizedgainsorlossesonderivativefinancialinstrumentsthatdonotqualifyforhedgeaccounting,foreignexchangegainsorlossesonlongtermdebtandothersignificantitemsofanunusualornonrecurringnature.


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KEYINVESTMENTMERITS

Leaderingreenpackaging&tissue

Attractivevaluation

Favorablebusinessconditions

Improvingsellingprice rawmaterialcostspread


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COMPANYOVERVIEWCOMPANYOVERVIEW


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BALANCEDPACKAGINGANDTISSUEPLAY

Packaging79%ofSales

71%EBITDA

LeadingNorthAmericanpackagingandtissuemanufacturerwithLeadingNorthAmericanpackagingandtissuemanufacturerwith

substantialrecyclingcapabilitiessubstantialrecyclingcapabilities

CascadesLTMQ12010Sales:$3,849

LTMQ12010EBITDA:$436

TissuePapers21%ofSales

29%EBITDA

Boxboard32%ofSales

25%EBITDA

Containerboard

27%ofSales

29%EBITDA

SpecialtyProducts20%ofSales

17%EBITDA

($inmillions)

EBITDAexcludingspecificitems.BreakdownofsalesandEBITDAbeforeeliminations.


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BALANCEDPACKAGINGANDTISSUEPLAY

1Includesthe6manufacturing/convertingtissuepapersunitsand7RenodeMedicisunits.

100+businessunits100+businessunits

EvolvingtoaclosedEvolvingtoaclosedloopbusinessmodelthatoffersavarietyofgreenproductsloopbusinessmodelthatoffersavarietyofgreenproducts

34 units

19 units

66 units

May be sent to

recycling centers

1

1


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LEADINGMARKETPOSITIONS

1Includesthe6manufacturing/convertingtissuepapersunitsand7RenodeMedicisunits.

LeadingmarketpositionscomplementourupstreamrecyclingoperaLeadingmarketpositionscomplementourupstreamrecyclingoperationstions

PACKAGING

Globalleaderincoatedrecycledboxboard

2nd inEurope1

3rdinNorthAmerica

#1NorthAmericanQuickservicerestaurantcartonandcupproducer(Dopaco)

#1Canadian

containerboard

producer

(Norampac) #1 Canadianrecycledfinepaperproducer

#1 Canadianrecycledpapercollector

TISSUE

Coleader inCanadaand4th largest inNorthAmerica

#1 green tissuepapersretailbrandinCanada

OneoftwoNorthAmericanpubliccompaniesinpackaging&tissueOneoftwoNorthAmericanpubliccompaniesinpackaging&tissue

Leverageto4milliontons(74%recycled)Leverageto4milliontons(74%recycled)


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MARKETREVIEWMARKETREVIEW


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NORTHAMERICANBOXBOARDSECTOR

Source:RISI.

CapacityutilizationrateestimatedbyCascades.

SteadydemandsupportingrecentpriceincreaseSteadydemandsupportingrecentpriceincrease

YoY Production

change

YTD

Apr.

2010 5

%Capacity utilization rateYTDApr.2010 90%

U.S.foldingcoated recycledboxboardindustry

productionan dcapacity utilization rate

120

130

140

150

160170

180

190

Jan08Apr08July08Oct08Jan09Apr09July09Oct09Jan10Apr10

('000s.t.)

70%

75%

80%

85%

90%95%

100%

105%

TotalProduction Capacityutilizationrate


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EUROPEANBOXBOARDSECTOR

Source: CEPICartonboard.

5weekweeklymovingaverage

TheEuropeanboxboardindustryweatheredthestormin2009TheEuropeanboxboardindustryweatheredthestormin2009

andisnowuptoasharpreboundin2010andisnowuptoasharpreboundin2010

YoY changeWeek 20YTDorder inflow WLC 25%

YoY changeWeek20YTDorderinflowFBB 31%

Coatedrecycled boxboardorderinflow(WLC)1

20000

30000

40000

50000

60000

70000

1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52

(weeks)

(m.t.)

2008 2009 2010

Coatedvirginboxboardorderinflow(FBB)1

20000

25000

30000

35000

4000045000

50000

55000

60000

1 4 7 10 13 16 19 22 25 28 31 34 37 4 0 43 46 4 9 52

(weeks)

(m.t.)

2008 2009 2010


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CONTAINERBOARDSECTOR

StrongdemandandlowinventoriesleadingtosellingpricemomenStrongdemandandlowinventoriesleadingtosellingpricemomentumtum

Source:Fibre BoxAssociationandRISI.

YoY productionchangeYTDApr.2010 13%

Capacity utilization rateYTDApr.2010 94%

Inventories Apr.2010 2.1Ms.t.

YoY changeApr.2010 11%

U.S.containerboardinventoriesatboxplantsandmills

2.0

2.1

2.2

2.3

2.42.5

2.6

2.7

Jan08 Apr08July08 Oct08 Jan09 Apr09July09 Oct09Jan10 Avr10

(Ms.t.)

3.0

3.5

4.0

4.5

5.0

5.5

(weeks)

Millionsshorttons Weeksofsupply

U.S.containerboardindustry production andcapacityutilizationrate

1,750

2,000

2,250

2,500

2,750

3,000

3,250

Jan08Apr08July08Oct08Jan09Apr09July09Oct09Jan10Apr10

('000s.t.)

70%

75%

80%

85%

90%

95%100%

105%

110%

TotalProduction Capacityutilizationrate


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TISSUESECTOR

Despiteacompetitiveretailsector,tissuemarketremainsbalanDespiteacompetitiveretailsector,tissuemarketremainsbalancedced

Source:RISI.

YoY ProductionchangeYTDMar.2010 0%

Capacity utilization rateYTD Mar.2010 94%

YTDchangeretail Mar.2010(%) 1%

YTDchangeAfH Mar.2010(%) 0%

U.S.tissuepaperindustryproduction(parentrolls)and

capacityutilizationrate

550

575

600

625650

675

700

Jan08 Apr08 July08 Oct08 Jan09 Apr09 July09Oct09 Jan10

('000

s.t.)

86%

88%

90%

92%94%

96%

98%

Totalparentrollproduction Capacityutilizationrate

U.S.tissuepaperindustry

convertedproductshipments

300325

350375400

425450

475500

Jan08 Apr08July08Oct08Jan09 Apr09July09Oct09Jan10

Retail

('000s.t.)

150175

200225250

275300

325350

Awayfhome

('000s.t.)

Fortheretailmarket Fortheawayfromhomemarket


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UPWARDSELLINGPRICES

Source:RISIandEUWID

MarketReferencePrices

350

550

750

950

1150

1350

1550

Jan07 July07 Jan08 July08 Ja n09 July09 Jan10

(US$/ton)

550

600

650

700

750

800

850

900

950

1000

1050

(/tonne)

Linerboard C.recycledboxboardN.A.C.virginboxboardN.A. KraftpaperFinepaper Recycledtissuep.(parentr.)C.vir inboxboardEuro e C.rec cledboxboardEuro e

PricesarenowstartingtomovehigherinallsegmentsPricesarenowstartingtomovehigherinallsegments


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(000s.t.)

RAWMATERIALPRICES

Source:RISIOCC:Oldcorrugatedcontainers.SOP:Sortedofficepapers.AverageofNYandChicagoregions.

(000s.t.)

OCCpriceshaveonceagainpeakedinMarch;OCCpriceshaveonceagainpeakedinMarch;

OCC&SOPdown30OCC&SOPdown3050US$inthepast2months50US$inthepast2months

NorthAmericanRecycledfibreprices(in$US)

0

25

50

75

100

125

150

175

200

225

250

Apr0

8

May0

8

June0

8

July0

8

Aug0

8

Sept0

8

Oct0

8

Nov0

8

Dec0

8

Jan0

9

Fe

b0

9

Mar0

9

Apr0

9

May0

9

June0

9

July0

9

Aug0

9

Sept0

9

Oct0

9

Nov0

9

Dec0

9

Jan1

0

Fe

b1

0

Mar1

0

Apr1

0

May1

0

($US/ton)

OCC(avrg.NY,Chicago)

SOP(avrg.NY,Chicago)

228

129

198

180


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FINANCIALSUMMARYFINANCIALSUMMARY


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Q12010 Q42009EBITDAVARIANCE

EBITDAexcludingspecificitems

Higherenergyandrawmaterialcosts,strongerCAN$,unfavourablHigherenergyandrawmaterialcosts,strongerCAN$,unfavourablee

salesmixandseasonalityimpactedourQ1EBITDAsalesmixandseasonalityimpactedourQ1EBITDA

Containerboard 30 5 0 1 0 2 (10) 28Boxboard 33 3 2 (1) (2) (5) (7) 23

Specialty products 19 (1) 0 0 1 (2) 1 18Tissue 35 2 (3) (2) (5) 0 (8) 19Corporate (7) 0 0 0 0 (3) 0 (10)

Consolidated 110 9 (1) (2) (6) (8) (24) 78

110

78

(1)

(8)

9 (2) (6)

(24)

0

20

40

60

80

100

120

140

160

Q4 2009

EBITDA

Cost

improvements

& other items

Shipments Energy costs Selling price &

mix

Variation of the

CAN$

Raw material

costs

Q1 2010

EBITDA

(M$)


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KEYPERFORMANCEINDICATORS(KPIs)

Steadypickupinmanufacturingshipments;Steadypickupinmanufacturingshipments;

ConvertingoperationsimpactedbyseasonalityConvertingoperationsimpactedbyseasonality

Totalshipments&Manufacturingcapacity

utilizationrate

467 499 427 411 433 457 467502

364

352 332 348350 341

511

360

386

390

0

100

200

300

400

500

600

700

800

900

1000

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

('000s.t.)

75%

77%

79%

81%

83%

85%

87%

89%

91%

93%

95%

Convertingshipments

Manufacturingshipments

Manufacturingcapacityutilizationrate


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Debt/Debt+Equity

54.3%54.4%

59.9%59.0%

58.6%59.1%

58.5%

56.1%

54.6%

53.0%

54.0%

55.0%

56.0%

57.0%

58.0%

59.0%

60.0%

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

Netdebt/LTMEBITDA

3.3

3.53.5

5.1

5.96.2

5.95.5

4.0

3.0

4.0

5.0

6.0

7.0

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

LTMEBITDA/LTMinterest

4.64.3

2.83.0

2.8

3.03.4

4.0

4.4

2.5

3.0

3.5

4.0

4.5

5.0

5.5

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

*Includes$97 MofnetdebtfromunrestrictedsubsidiariesandJVsinQ12010.

BALANCESHEET&KEYFINANCIALRATIOS

ImprovementinalldebtratiosrelativetoQ12009ImprovementinalldebtratiosrelativetoQ12009

2010Year Q1 Q2 Q3 Q4 Year Q1

Totalassets 4,031 4,041 3,886 3,877 3,792 3,792 3,764

Totaldebt 1,812 1,818 1,670 1,590 1,552 1,552 1,531

Netdebt* 1,800 1,805 1,658 1,569 1,533 1,533 1,508

Shareholders'

equity 1,256 1,289 1,309 1,335 1,304 1,304 1,271Bookvaluepershare $12.79 $13.23 $13.43 $13.70 $13.41 $13.41 $13.11

LTMEBITDA 306 354 412 451 465 465 436

LTMInterest 102 105 104 102 101 101 102

2008 2009


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Longtermdebtrepaymentschedule

0

200

400

600

800

1

000

1200

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

(M CAN$)

Sept.

30,

2009 March

31,

2010

RECENTNOTESREFINANCING

ImprovingdebtprofilebyextendingdebtmaturitiesImprovingdebtprofilebyextendingdebtmaturities

6.75%/7.25%

7.75%

7.75%

7.875%


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CONCLUDINGREMARKSCONCLUDINGREMARKS


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SECONDQUARTEROUTLOOK

Boxboard

NorthAmerica

Boxboard

EuropeContainerboard

Specialty

productsTissuepapers

VolumeSlight

Increase

Slight

Increase

Slight

Increase

Slight

Increase

Slight

Increase

SellingpricesSlight

Increase

Slight

Increase

IncreaseSlight

Increase

Slight

Increase

Rawmaterial

costsDecrease Stable Decrease

Slight

Increase

Slight

Increase

BusinessconditionsareimprovinginallsectorsBusinessconditionsareimprovinginallsectors


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Upto8%June110MCAN$AfH Canada

Tissuepapers

33/s.t.April

83/s.t.February223,000s.t.Virginboard

55/s.t.JuneBoxboard

Europe

20US$/s.t.May

60US$/s.t.April

Specialty

products

Containerboard

BoxboardNorth

America

50US$/s.t.June

60US$/s.t.April

33/s.t.February155,000s.t.Europe

50US$/s.t.April159,000s.t.Virginboard

50US$/s.t.March235,000s.t.Parentrolls

30US$/s.t.February103,000s.t.Uncoatedboard

Upto11%June225MCAN$AfH U.S.

40US$/s.t.February110,000s.t.Kraftpapers

40US$/s.t.March145,000s.t.Finepapers

50US$/s.t.January1,115,000s.tNorthAmerica

88/s.t.June

55

/s.t.February375,000

s.t.Recycled

board

45US$/s.t.April

30US$/s.t.January223,000s.t.Recycledboard

AnnouncedPotentialIncreaseAnnouncedeffectivedateCapacity/leverageSegment

Announcedpriceincreasesbymarketparticipants.Cascades implementationofpriceincreasesmaysignificantlydifferfrom announcedincreasesbymarketparticipants.


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CascadesNorthAmericansellingprice

andrawmaterialcostindices(US$)

1,100

1,200

1,300

1,400

1,500

1,600

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

Selling

prices

200

300

400

500

600

700

800

Rawmaterial

costs

Sellingpricesindex(US$) Rawmaterialsindex(US$);

EBITDA

$107M EBITDA

$121M

EBITDA

$127M

EBITDA

$110M

EBITDA

$78M

CascadesshouldbenefitfromanimprovedspreadCascadesshouldbenefitfromanimprovedspread



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STOCKVALUATION

ConsideringaninvestmentvalueinBoralexofConsideringaninvestmentvalueinBoralexof1.20$/share,1.20$/share,

Cascadesiscurrentlytradingatonly4.7xEV/LTMEBITDACascadesiscurrentlytradingatonly4.7xEV/LTMEBITDA

LTM

400 436 475

4.7 5.04$ 6.78$ 8.67$

5.0 6.27$ 8.13$ 10.14$

5.4 7.92$ 9.93$ 12.10$

5.8 9.57$ 11.72$ 14.06$

6.2 11.22$ 13.52$ 16.01$

EBITDA

EV/EBITDA

Multiple

AsofJune 1,2010.


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EV/12M Forward EBITDA

3

4

5

6

7

8

9

10

11

May05

July05

Sept05

Nov05

Jan06

Mar06

May06

July06

Sept06

Nov06

Jan07

Mar07

May07

July07

Sept07

Nov07

Jan08

Mar08

May08

July08

Sept08

Nov08

Jan09

Mar09

May09

July09

Sept09

Nov09

Jan10

Mar10

May10

CAS PKG RKT SON KMB PTV IP

STOCKVALUATION

ConsideringBoralex,CascadesiscurrentlytradingConsideringBoralex,Cascadesiscurrentlytrading

atonly4.9xEV/12MForwardEBITDA,a1.6xdiscounttopeersatonly4.9xEV/12MForwardEBITDA,a1.6xdiscounttopeers

Cascades

Current:4.9x

Average:6.3x

Average discounttopeers:(1.0x)

Current discounttopeers:(1.5x)

Source:Bloomberg,ThomsonOneandNationalBankFinancial.


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VALUECREATIONTHROUGHFOCUSONROA

ReturnonassetsisanonGAAPmeasureandisdefinedas:LTMEBITDAexcludingspecificitems/LTMAverageoftotalquarterlyassets.

*

2008 2009 Q12010

Boxboard 3% 11% 11% 25%

Containerboard 9% 10% 10% 36%

Specialtyproducts 11% 13% 14% 15%

Tissue

papers 18% 27% 23% 16%TotalCascades 8% 12% 11%

%ofassets

(average

assets

2009)

Returnonassets

ContinuousfocusonROAtoreach15%within3to5yearsContinuousfocusonROAtoreach15%within3to5years


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APPENDICESAPPENDICES


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SENSITIVITYANALYSIS

AsofDecember31,2009.

CHANGE

1 SELLING PRICE NORTHAMERICA

BOXBOARD 499 25$/ST 13

CONTAINERBOARD 1062 25$/ST 28

SPECIALTY(paperonly) 444 25$/ST 12

TISSUE 459 25$/ST 12

EUROPE

BOXBOARD 525 25$/ST 20

CONTAINERBOARD 153 25$/ST 6

2 RAWMATERIALS NORTHAMERICA

RECYCLEDPAPERS Browngrades(OCCandothers) 1208 15$/ST (19)

Groundwoodgrades(ONPandothers) 134 15$/ST (2)

White

grades

(SOP

and

others) 650

15$

/

ST (10)

EUROPE

Browngrades(OCCandothers) 242 15/ST (5)

Groundwoodgrades(ONPandothers) 118 15/ST (3)

Whitegrades(SOPandothers) 152 15/ST (3)

COMMERCIALPULP NORTHAMERICA 184 30$/ST (6)

EUROPE 79 30/ST (4)

3 NATURALGAS NORTHAMERICA 8692 1,00 $ (9)

EUROPE 3036 1,00 (5)

4 CANADIANDOLLAR SalesinUS 333700000 (0,01)$ (3)

EBITDAUSSubs 175156966 (0,01)$ (2)

Shipments/Consumption

('000

tons,

'000mmBtufornaturalgas)OIBD

impact

(in

millionsofCAN$)


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HEDGINGPORTFOLIO

1. CashflowUSD,netexposureincludinginterest:

2010(8months):US$56M@$1.21(59%ofexposure)

2011:US$47.5M@$1.15(30%ofexposure)

2. USDlongtermdebt: 2013forwardcontractsfor$360M(40%)@$1.19

3. Naturalgas:

Canada:

2010:

63%

at

6.31

CAN$/GJ 2011:41%at7.12CAN$/GJ

2012:32%at7.02CAN$/GJ

U.S.:

2010:56%at6.89US$/mmBtu

2011:

41%

at

7.40

US$/mmBtu 2012:23%at7.88US$/mmBtu

LowerbusinessriskbymanagingfinancialriskLowerbusinessriskbymanagingfinancialrisk


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14%

51%

35%

GEOGRAPHICANDPRODUCTDIVERSITY

BoxboardMill2 993ST

Converting 289ST

Containerboard

Mill 1,270STConverting 12,996MSF

Specialty ProductsIndustrial Packaging 387MTorSQFT

ConsumerPackaging 44,000KG

Specialty Paper 596ST

Recovery andRecycling 1,500ST

TissuePaperMill 664ST

Converting n/a

Capacity (in000s)1

1Theoreticalcapacity.Boxboardandcontainerboardconvertingcapacityrepresents2008shipments.2IncludingourshareofRenodeMediciS.p.A.

Note: ST ShortTons;MT MetricTonnes;MSF MillionSquareFeet;SQFT SquareFeet;andKG Kilograms.

Salesfrom (source)2009

15%

39%

46%

UnitedStatesUnitedStates

Europe

CanadaCanada

Salesto (destination)2009


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PROACTIVELYADJUSTINGASSETBASE

Proactivelyadjustingassetbasetoreducecosts,improvefinancProactivelyadjustingassetbasetoreducecosts,improvefinancialflexibilityandialflexibilityand

redeploycapitaltowardscoresegmentsredeploycapitaltowardscoresegments

2006: Implementationofseveralrestructuringmeasuresinourfinepaperoperations

AcquisitionofDomtars50%stakeinNorampac

Acquisitionofrecycledboxboardassets(Simkins,Caraustar)

Saleofourfinepapersdistributionassets

Closureofourpulpmillandsawmill

Saleofourinterestintwoboxboardconvertingjointventures

SaleofRedRock,OntariocontainerboardmillandThunderBay,Ontariofine

papersmill

MergerofourEuropeanrecycledboxboardassetswithRenodeMediciS.p.A

ClosureofToronto,Ontariorecycledboxboardmill

SaleofourGreenfield,Francedeinkedpulpmill

AcquisitionofAtlanticPackagingstissuepaperassets

AcquisitionofYorkshirePaperCorporationandSonocosCanadian

RecyclingOperations

2007:

2008:

2009:


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INVESTMENTSWITHSTRONGPOTENTIAL

34%equity investment inthis publicly traded

renewable energy producer (BLX:Toronto)

MarketValue*:+/ $1.20perCascadesshare

36%equityinvestmentinthispubliclytradedEuropean

boxboardproducer(RM:Milan)

Marketvalue*:+/ $0.35perCascadesshare

TotalCapacity: 992,000tons

Stronggrowth&turnaroundstoriescurrentlyworth+/Stronggrowth&turnaroundstoriescurrentlyworth+/ $1.55perCASshare$1.55perCASshare

*AsofJune 1,2010.


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Similartoindustry,CascadesSimilartoindustry,Cascades salesaremostlyexposedtosalesaremostlyexposedto

lesscyclicalendlesscyclicalendusemarketsusemarkets

Foodproducts

44%Chemicals,

rubberand

petroleum

products

11%

Othernon

durables

7%

Durablegoods

13%

Transportation

1%

Paperand

printing

products

24%

Beverages

20 %

Dryfood

22 %Health&Beauty

Care

10 %

Othernon

durables

9%

Durablegoods

4%

Others

14 %

Frozen/perish

able food

21%

Retail(athome)

69 %

Awayfrom

home

31 %

RELATIVELYSTABLEENDMARKETEXPOSURE

U.S.TissuePaperProductsShipmentsIndustryBreakdown(2009)

U.S.FoldingCartonIndustryBreakdown(2008)U.S.CorrugatedBoxShipmentsIndustryBreakdown(2007)

Source:FiberBoxAssociation,Paper PackagingCouncilandRISI.


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CONTAINERBOARDSECTOR

ContainerboardmarketscontinuetoimproveContainerboardmarketscontinuetoimprove

Source:PaperPackagingCanada

YoY changeYTDMar.2010 3% YoY changeMar.2010 6%

CanadianCorrugatedboxindustryshipments

1.80

2.00

2.202.40

2.60

2.80

3.00

Jan08Apr08July08Oct08Jan09Apr09July09Oct09Jan10

(MMSF)

20%

15%

10%

5%

0%

5%

10%

15%

Shipments Annualchange

Canadiancontainerboard inventoriesatboxplantsand

mills

100,000

110,000

120,000

130,000

140,000

150,000

Jan

08

Apr

08

July

08

Oct

08

Jan

09

Apr

09

July

09

Oct

09

Jan

10

(s.t.)


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CANADIANLEADERINPAPERRECOVERY

ProactivelymanagingrawmaterialsupplyProactivelymanagingrawmaterialsupply

Material Sorting Facilities (MRF): 19

Major Regions: BC, Alberta, Ontario, Manitoba, Quebec, New York State

Annual brokerage and processing capacity: around 1.8 million short tons


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NORTHAMERICANRECYCLEDFIBRESUPPLY

Controlover87%ofourfibresupplyControlover87%ofourfibresupply

2008

Convertingplants

4%

Cascades

Recuperation

& Metro

Waste

31%

Brokers

19%

Contractual

agreements

46%

2009

Convertingplants

5%Cascades

Recuperation

& Metro

Waste

32%

Brokers

13%

Contractual

agreements

50%


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PIONEEROFSUSTAINABLEDEVELOPMENT

2.5millionshorttonsofrecycledfibres(consumption)

9.7m3 ofwaterused permetric tonneofpaper1

Continuousreductioninenergyconsumption&GHGemissions

Beneficial useof63%ofgenerated waste

189

286268

180

220

260

300

2007 2008 2009

(kg/metric

tonne)

10.5

9.7

10.0

9.0

10.0

11.0

2007 2008 2009

(kg/metric

tonne)

RelativeWaterConsumption1 RelativeGHGEmissions1

12007and2008dataincludesthetworecycledboxboardmillsthat weretransferredtoRenoDeMediciinMarch2008.Allthedataexcludesour

participationinRenoDeMediciS.p.A.


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LEADINGMARKETPOSITIONS

16

36

45

10

2.5%2.9%

5.0%

6.1%

0

10

20

30

40

50

2006 2007 2008 2009

($inmillions)

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

16

36

58

81

0

20

40

60

80

2006 2007 2008 2009

($in millions)

SalesCanadianretail marketshares ofCascades

tissuepaper brand(Bathroom tissuepapers)

RightproductofferingtobenefitfromtheRightproductofferingtobenefitfromthegreengreen demanddemand

CAGR=72% CAGR=65%

Source:ACNielsen (MarketTrack).

SalesoftheCascadesFinePaperEnviro Brand CanadianRetailSalesoftheCascadesTissuePaperBrand


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RECENTRATINGOUTLOOKUPGRADES

"ThisoutlookrevisionreflectsrecentimprovementincreditmetricsandourexpectationsthatCascades'

profitabilitywillimproveinthenext12months,"Standard&Poor'screditanalystJatinder Mall

Moodys

Seniorsecureddebt Baa3 BB+

Seniorunsecureddebt Ba3 B+

Corporatedebtrating Ba2 BB

Outlook Stable Stable

Mostrecentratingcomment December09 December09

Standard&

Poors

Cascades outlookrevisionreflectsthecompanysimprovedoperatingandfinancialperformance,with

theexpectationthatthecompanysperformancewillbesustainedaseconomicconditionsimproveinthe

next12months,"MoodysVicePresident SeniorAnalystEdSustar

S&PandMoodyS&PandMoodyshaverecentlyupgradedCascadesshaverecentlyupgradedCascades ratingoutlooktostableratingoutlooktostable

COGS BREAKDOWN


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COGSBREAKDOWN

Note:2009Yearlydata

Whilerawmaterialpriceisamajorfactor,Whilerawmaterialpriceisamajorfactor,

efficienciesarebeingimplementedintheremaining67%ofcostsefficienciesarebeingimplementedintheremaining67%ofcosts

67%

SEGMENTED EBITDA


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42

Boxboard

9 10

24

11

2632

23

3

33

0

5

10

15

20

25

30

35

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

(%ofsales) Containerboard

30

37

32 31

2830

3841

36

20

25

30

35

40

45

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

9.0%

12.0%

15.0%

18.0%

(%ofsales)

Tissuepapers

39 38

19

35

42

41

22

1512

05

101520253035

4045

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

4.0%

7.0%

10.0%

13.0%

16.0%19.0%

22.0%

(%ofsales)Specialtyproducts

15

21 2022

13

22

9

1819

0

5

10

15

20

25

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

(%ofsales)

SEGMENTEDEBITDA

EBITDAexcludingspecificitems.

PressurePressurefeltfelt inineveryevery groupgroupexceptexcept forforSpecialtySpecialty productsproducts

thankstotherecoveryoperationsthankstotherecoveryoperations

KEY PERFORMANCE INDICATORS (KPI )


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43

KEYPERFORMANCEINDICATORS(KPIs)

2010

(InmillionofCAN$,unlessotherwisenoted)Year Q1 Q2 Q3 Q4 Year Q1

Totalshipments(in'000ofs.t.)

Packaging 2,925 637 672 697 693 2,699 724 Tissuepapers 471 106 109 120 124 459 119

Total 3,396 743 781 817 817 3,158 843

Capacityutilizationrate % 88% 81% 85% 89% 89% 86% 94%

Integrationrate(NorthAmerica) % 46% 49% 49% 49% 48% 49% 47%

LTMReturnonassets(%) 7.8% 8.9% 10.4% 11.4% 11.9% 11.9% 11.4%

Workingcapital

Inmillionsof$ 664 662 645 593 552 552 548%LTMofsales 16.5% 16.4% 16.1% 15.0% 14.2% 14.2% 14.6%

Operational

Financial

2008 2009

Volumesup3%vs.Q42009and12%*vs.Q12008Volumesup3%vs.Q42009and12%*vs.Q12008

Capacityutilizationratereachingitsbestlevelsince2007Capacityutilizationratereachingitsbestlevelsince2007

*ExcludingtheacquisitionofAtlanticPackagingstissueassets

Q1 2010 Q1 2009 EBITDA VARIANCE


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Q12010 Q12009EBITDAVARIANCE

EBITDAexcludingspecificitems

YYooY,improvedcoststructureandvolumesmorethanoffsetbyY,improvedcoststructureandvolumesmorethanoffsetby

higherrawmaterialcosts&CAN$,loweraveragesellingpriceshigherrawmaterialcosts&CAN$,loweraveragesellingprices

78

107

623

27

31

30

24

0

20

40

60

80

100

120

140

160

180

Q1 2009

EBITDA

Cost

improvements

& other items

Ship me nts Ene rg y c osts Var ia tion of th e

CAN$

Raw material

costs

Selling pr ice &

mix

Q1 2010

EBITDA

(M$)

Containerboard 36 10 10 3 (2) (15) (14) 28

Boxboard 24 15 4 3 (6) (9) (8) 23

Specialty products 13 3 4 1 (7) 6 (2) 18

Tissue 39 0 5 (1) (5) (12) (7) 19

Corporate (5) (1) 0 0 (4) 0 0 (10)

Consolidated 107 27 23 6 (24) (30) (31) 78

CASH FLOW OVERVIEW


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CASHFLOWOVERVIEW

$122Moffreecashflowgeneratedoverthelasttwelvemonths$122Moffreecashflowgeneratedoverthelasttwelvemonths

FreecashflowyieldisdefinedasLTMFCFpershare/sharepriceendofperiod

2010(inmillionsofCAN$)

Year Q1 Q2 Q3 Q4 Year Q1

Cashflowfromoperations 155 68 81 94 62 305 38

Workingcapitalvariation (31) (1) 1 23 29 52 (5)

Cashflowprovidedbyoperations 124 67 82 117 91 357 33

Capitalexpenditures&otherassets (183) (43) (35) (53) (57) (188) (36)

Dividend&ShareBuyback (20) (6) (4) (5) (5) (20) (6)

Freecashflow (79) 18 43 59 29 149 (9)Freecashflowpershare 0.80$ 0.18$ 0.44$ 0.61$ 0.30$ 1.53$ 0.09$

2008 2009

Cashflowprovidedbyoperations91

48

(31)

67

22

1178285

33

(60)

(30)

0

30

60

90

120

150

Q

1

20

08

Q

2

20

08

Q

3

20

08

Q

4

20

08

Q

1

20

09

Q

2

20

09

Q

3

20

09

Q

4

20

09

1

20

10

(MCAN$) Freecashflow43

2879

91018 18

59

29

11%18%

23%13%

8%

8%17%

10 %15%

100

75

50

25

0

25

50

75

100

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

($)

40%

20%

0%

20%40%

60%

80%

100%

Freecashflow Freecashflowyield

NET DEBT RECONCILIATION


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NETDEBTRECONCILIATION

Currentavailability**ofapproximately$375MoncreditfacilitCurrentavailability**ofapproximately$375Moncreditfacilitiesies

*Includes$97Mofnetdebtfromunrestrictedsubsidiariesandjointventures.

**$435Mdrawnfromthecreditfacilityand$24Minlettersof credit.CreditAgreementBorrowingBaseamountsto$812Monaauthorizedamountof$850M.

Netdebtdown$25millioninQ1andcurrentavailability**Netdebtdown$25millioninQ1andcurrentavailability**

ofapproximately$350Moncreditfacilitiesofapproximately$350Moncreditfacilities

1,508*

1,533

(21)636185

(161)

(37)(33)

1,000

1,250

1,500

1,750

2,000

Netdebt

December

31,2009

Changein

revolving

creditfacility

CAPEX Div.&stock

buyback

Others Cashflow

from

operations

ImpactofF/X Purchaseof

seniornotes

Netdebt

March31,

2010

(M$)

PACKAGING BOXBOARD


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PACKAGING BOXBOARD

Boxboard

9 10

33

3

23

32 26

11

24

0

510

1520

2530

35

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

(%ofsales)

Total

shipments

&

Manufacturing

capacity

utilizationrate

233 240 201249 255 252 268 280

70

68

68 6566

253

6774 73 67

0

100

200

300

400

500

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

('000s.t.)

60%

65%

70%75%

80%

85%

90%

95%

100%

Manufacturingshipments ConvertingshipmentsCapacityutilizationrate(%)

Cascades'

average

manufacturing

selling

price

North

America&Europe

600

640

680

720

760

800

840

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

($)

510

520

530

540

550

560

570

AveragepriceN.A.(US$/s.t.)AveragepriceN.A.(CAN$/s.t.)Avera e riceEuro e /s.t.

()

Cascades' converting price

2000

2200

2400

2600

2800

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

Converting Price (US$/s.t.) Converting Price (CAN$/s.t.)

PACKAGING CONTAINERBOARD


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PACKAGING CONTAINERBOARD

Containerboard

30

37

32 31

2830

3841

36

20

25

30

35

40

45

Q12008

Q22008

Q32008

Q42008

Q12009

Q22009

Q32009

Q42009

Q12010

(MCAN$)

9.0%

12.0%

15.0%

18.0%

(%ofsales) Cascades' average manufacturing price

400

450

500

550

600

650

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

Average price (US$/s.t.) Average price (CAN$/s.t.)

Cascades' Manufacturing shipments and Capacityutilization rate

225

250

275

300

325

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

'000 s.t.

50%

60%

70%

80%

90%

100

Manufacturing shipm ents ('000 s.t.)Capacity utilization rate (%)

Cascades' Converting price and shipments

2,5

2,8

3,1

3,4

Q1 2008Q2 2008Q3 2008Q4 2008Q1 2009Q2 2009Q3 2009Q4 2009Q1 2010

(B. sq. ft)

60

65

70

75

80

$

Converting shipments (Bil lion sq.ft.) Average price (US$/s.t.)

Average price (CAN$/s.t.)

MARKET PRICE AND COST SUMMARY


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MARKETPRICEANDCOSTSUMMARY

Source:RISI,RandomLengthsandCascades.

2008 2009 2010

Q1 2010

Q1 2009

Q1 2010

Q1 2009

Q1 2010

Q4 2009

Q1 2010

Q4 2009Average Average

Q1

Average

Q2

Average

Q3

Average

Q4

Average Average

Q1

(unit) (%) (unit) (%)

Selling prices

Cascades North American US$ index

(index 2003 = 1,000) 1,500 1,487 1,427 1,412 1,417 1,436 1,496 9 1% 79 6%

PACKAGING

Boxboard

North America (US$/ton)

Recycled boxboard - 20pt. Clay coated news (transaction) 764 768 745 743 759 754 790 22 3% 31 4%

Europe (Euro/tonne)Recycled white-lined chipboard (GD2) index 649 628 603 590 585 601 590 -38 -6% 5 1%

Virgin coated duplex boxboard (GC2) index 985 984 975 962 952 968 973 -11 -1% 21 2%

Containerboard (US$/ton)

Linerboard 42-lb. unbleached kraft, East US (transaction) 582 578 543 537 530 547 580 2 0% 50 9%

Corrugating medium 26-lb. Semichemical,

East U.S. (transaction) 561 548 513 507 500 517 550 2 0% 50 10%

Specialty products

(US$/ton, tonne for deinked pulp)

Recycled boxboard - 20pt. Bending chip (transaction) 601 600 555 548 555 565 575 -25 -4% 20 4%

Deinked pulp

(f.o.b; U.S. air-dried & wet-lap, post-consumer) 740 585 570 595 653 601 708 123 21% 55 8%Unbleached kraft paper, Grocery bag 30-lb. 958 937 920 920 927 926 960 23 2% 33 4%

Uncoated white 50-lb. offset, rolls 914 897 845 822 855 855 868 -29 -3% 13 2%

TISSUE PAPERS

Cascades Tissue papers (index 1999 = 1,000) 1,581 1,615 1,628 1,605 1,628 1,617 1,617 2 0% -11 -1%

Raw materials

Cascades North American US$ index

(index 2003 = 300) 492 268 286 364 420 334 553 285 106% 133 32%

RECYCLED PAPER

North America (US$/ton)

Corrugated containers, no. 11

(OCC - Chicago & NY average) 98 27 45 77 75 56 149 122 452% 74 99%

Special news, no. 8 (ONP - Chicago & NY average) 115 32 45 65 83 56 90 58 181% 7 8%

Sorted office papers, no. 37 (SOP - Chicago & NY average) 188 90 90 125 174 120 225 135 150% 51 29%

Europe (Euro/tonne)

Recovered mixed paper & board sorted index 55 12 21 35 44 28 72 60 500% 28 64%VIRGIN PULP (US$/tonne)

Bleached softwood kraft Northern, East U.S. 857 677 643 733 820 718 880 203 30% 60 7%

Bleached hardwood kraft Northern mixed,

East U.S. 788 595 532 603 706 609 776 181 30% 70 10%

WOODCHIPS Conifer eastern Canada (US$/odmt) 132 111 118 124 131 121 125 14 13% -6 -5%

Change

These indexes should only be used as indicator of trends and

they be different than our actual selling prices or purchasing

costs.

Change


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51CREDIT:IMAGEECOterre

Formoreinformation:Formoreinformation:

www.cascades.comwww.cascades.com/investors/investors

DidierFilionDidierFilion

Director,InvestorRelationsDirector,InvestorRelations

[email protected][email protected]

2010 Goldman Sachs Basic

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