KINGSEY FALLS, QC. (News release) -- Cascades Inc. reports its unaudited financial results for the three-month period and fiscal year ended December 31, 2025.

Q4 2025 Highlights

• Sales of $1,197 million (compared with $1,238 million in Q3 2025 and $1,211 million in Q4 2024);
• Operating income of $76 million (compared with $73 million in Q3 2025 and $16 million in Q4 2024);
• Net earnings per common share of $0.37 (compared with net earnings per common share of $0.29 in Q3 2025 and a net loss per common share of ($0.13) in Q4 2024);
• Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA (A)¹) of $155 million (compared with $159 million in Q3 2025 and $146 million in Q4 2024);
• Adjusted net earnings per common share¹ of $0.40 (compared with $0.38 in Q3 2025 and $0.25 in Q4 2024);

2025 Annual Highlights

• Sales of $4,776 million (compared with $4,701 million in 2024);
• Operating income of $235 million (compared with $95 million in 2024);
• Net earnings per common share of $0.70 (compared with a net loss per common share of ($0.31) in 2024);
• Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA (A)¹) of $576 million (compared with $501 million in 2024);
• Adjusted net earnings per common share¹ of $1.10 (compared with $0.60 in 2024);
• Net debt¹ of $1,896 million as of December 31, 2025 (compared with $2,096 million as of December 31, 2024). Net debt to EBITDA (A) ratio¹ of 3.3x, down from 4.2x as of December 31, 2024;
• Following the asset sales completed in 2025 and early 2026, the Corporation has surpassed its disclosed target of generating $120 million of proceeds from the monetization of redundant assets by mid-2026;
• Total capital expenditures of $42 million in Q4 2025 and $152 million in 2025. The Corporation's 2026 forecasted capital expenditures before disposals will be approximately $175 million.
• Several strategic actions were implemented during the year and are beginning to generate tangible results, both operationally and financially.

Hugues Simon, President and CEO, commented: "Our fourth quarter consolidated performance met sequential forecasts. Packaging results were within expectations, with benefits from lower production costs, favourable raw material pricing and continued solid production levels at Bear Island mitigating the expected lower seasonal sales volumes. Results of our tissue business fell short of targeted levels. Simply put, our tissue operations did not meet efficiency and logistics execution objectives in the quarter. These effects were compounded by an unplanned power outage at one of our facilities that further impacted production levels, supply chain efficiency and added incremental operating costs of approximately $6 million in the period. The countermeasures we have already put in place to address these issues are generating positive traction. Overall, we successfully decreased net debt by $127 million sequentially, which results in leverage decreasing to 3.3x from 3.6x at the end of the third quarter."

Discussing near-term outlook, Mr. Simon commented, "We expect first‑quarter performance to decline sequentially, but to remain higher year‑over‑year for the sixth consecutive quarter. In packaging, the forecasted sequential decline is attributable to usual seasonality in demand levels and higher transportation and energy costs due to weather-related impacts in the US in early 2026. We are similarly expecting softer results in tissue sequentially. In addition to usual seasonality and costs related to severe weather, results in this segment will be impacted by residual production and logistics costs following the power outage at one of our facilities. Our leverage ratio is expected to continue to improve in the coming quarters.

Looking further ahead, we are confident in our ability to achieve our strategic objectives, and we expect our 2026 performance to surpass 2025, despite ongoing macro‑economic uncertainty. We made good progress across many of our initiatives over the past year. In addition to achieving our objective of generating $120 million of proceeds from asset sales ahead of schedule, we have generated approximately $30 million of profitability improvements. We are confident that the fundamentals for our Company are strong, and are steadfast in our commitment to continue to improve the financial profile, level of operational and commercial excellence and growth momentum of our Company."