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This presentation contains certain forward-looking information that reflects the Company’s current views and/or expectations with respect to: expectations relating to the markets the Company operates in; the impact of currency exchange rates and other market factors on the results of the Company’s mills; and expectations relating to capital expenditure spending. Persons reading this presentation are cautioned that statements comprising forward-looking information are only predictions, and that the Company's actual future results or performance are subject to certain risks and uncertainties including, without limitation: those relating to potential disruptions to production and delivery, including as a result of equipment failures, labour issues, the complex integration of processes and equipment and other factors; fluctuations in the market price for products sold; trade restrictions or import duties imposed by foreign governments; labour relations; failure to meet regulatory requirements; changes in the market; potential downturns in economic conditions; fluctuations in the price and supply of required materials; foreign exchange fluctuations; availability of financing (as necessary); and other risk factors detailed in our Annual Information Form dated March 28, 2018 available on SEDAR at www.sedar.com and other filings with the Canadian securities regulatory authorities. In particular, financial forecasts and expectations are not indicators of future financial performance and there is no assurance that the Company’s assumptions' in support of such forecasts or expectations are correct, accurate or complete. These risks, as well as others, could cause actual results and events to vary significantly. The Company does not undertake any obligation to update any forward-looking information, except as required by applicable securities law. Unless otherwise noted, all references in this presentation to “$” are to Canadian dollars. The selected financial information presented herein is qualified in its entirety by, and should be read in conjunction with, the Company’s unaudited condensed consolidated financial statements for the quarter ended September 30, 2018 and the related notes thereto and Management’s Discussion & Analysis, which are available on SEDAR. Where we disclose production costs, such costs are calculated based on a variety of factors and inputs which may result in such costs not being comparable to similar types of costs disclosed by other issuers. This presentation contains reference to “Operating EBITDA”, “adjusted net loss” and “adjusted net loss per share”, which are non-GAAP financial measures. For disclosure of the manner in which these measures are calculated and a reconciliation to net loss, please refer to the MD&A for the quarter ended September 30, 2018, available on SEDAR. The financial information contained herein has been prepared in accordance with International Financial Reporting Standards.

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• Operating EBITDA from continuing operations was $7.5 million for the third quarter of 2018 compared to operating EBITDA from continuing operations of $2.7 million in the second quarter of 2018.

• The Dissolving Pulp Segment generated operating EBITDA

of $9.0 million. The Bio-Products Segment generated operating EBITDA loss of $0.4 million and corporate costs were $1.1 million.

• Adjusted net loss from continuing operations was $3.6

million, or a basic and diluted adjusted net loss from continuing operations per share of $0.24.

3

(10)

(5)

-

5

10

15

Mill

ion

s $

Quarterly EBITDA from Continuing Operations

EBITDA

-

10

20

30

40

50

Q3-17 Q4-17 Q1-18 Q2-18 Q3-18

Mill

ion

s $

Sales by Quarter

Sales

• Operating EBITDA for the Dissolving Pulp Segment for the third quarter of 2018 was $9.0 million, compared to operating EBITDA of $4.2 million in the second quarter of 2018.

• Sales totaled $48.7 million for the quarter compared to

$50.1 million for the second quarter of 2018.

4

(10)

(5)

-

5

10

15

Mill

ion

s $

Quarterly EBITDA

EBITDA

-

10

20

30

40

50

Q3-17 Q4-17 Q1-18 Q2-18 Q3-18

Tho

usa

nd

s

Quarterly Shipments

Shipments

• The Company sold 38,433 air dried metric tonnes (“ADMT”) of dissolving pulp in the third quarter of 2018.

• The FSC mill held 4,929 ADMT of dissolving pulp inventory at September 30, 2018 compared to 2,743 ADMT as at June 30, 2018.

ADMT

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• In the third quarter of 2018, the FSC mill's production costs, including amortization of some of the planned

shutdown costs and the positive impact of the cogeneration facility, improved by 13% compared to the second quarter of 2018 due primarily to productivity gains and lower variable costs.

• Demand for dissolving pulp continues to be strong, supported by annual increases in the worldwide demand for fibre and viscose staple fibre capacity growth.

• Dissolving pulp prices are currently $1,237 (US$944) per tonne which is US$14 higher year over year.

• Management believes full year 2018 average pricing to be comparable to full year 2017 average pricing, supported in part by swing mill capacity shifting to paper pulp production as a result of increasing paper pulp pricing.

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We have evaluated swinging some production to NBHK and the economics still indicate to remain 100% on Dissolving Pulp

Paper Pulp Pricing Compared to DP

Source: RISI source for NBHK, NBSK spot price US Eastern . CCF source for Hardwood DP spot price CIF China

US$

$400

$500

$600

$700

$800

$900

$1,000

$1,100

Sep-16 Jan-17 May-17 Sep-17 Jan-18 May-18 Sep-18

DP NBHK NBSK

7

29

29.5

30

30.5

31

31.5

32

32.5

33

33.5

0

5

10

15

20

25

Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18

15 Digesters Tonnes Per Cook

Days Tonnage

8

10

/31

/20

15

11

/28

/20

15

12

/26

/20

15

1/2

3/2

01

6

2/2

0/2

01

6

3/1

9/2

01

6

4/1

6/2

01

6

5/1

4/2

01

6

6/1

1/2

01

6

7/9

/20

16

8/6

/20

16

9/3

/20

16

10

/1/2

01

6

10

/29

/20

16

11

/26

/20

16

12

/24

/20

16

1/2

1/2

01

7

2/1

8/2

01

7

3/1

8/2

01

7

4/1

5/2

01

7

5/1

3/2

01

7

6/1

0/2

01

7

7/8

/20

17

8/5

/20

17

9/2

/20

17

9/3

0/2

01

7

10

/28

/20

17

11

/25

/20

17

12

/23

/20

17

1/2

0/2

01

8

2/1

7/2

01

8

3/1

7/2

01

8

4/1

4/2

01

8

5/1

2/2

01

8

6/9

/20

18

7/7

/20

18

8/4

/20

18

9/1

/20

18

9/2

9/2

01

8

10

/27

/20

18

11

/24

/20

18

AD

T/D

ay Mill Stability

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• Fortress Advanced Bioproducts Inc. (“FortressAB”) continued work to advance its planned

xylitol demonstration plant project. The Company intends to produce xylitol and potentially other valuable bio-products from hemicellulose produced at the FSC mill using technology developed by FortressAB.

• In the third quarter of 2018, FortressAB focused on: negotiating definitive funding agreements

with various organizations within the federal and provincial governments for up to $17.4 million of grant, equity and loan funding announced in July 2018; finalizing a Technology License and Collaboration Agreement with the major global food company that has supported development of the FortressAB technology; and securing additional non-dilutive funding.

• In parallel, FortressAB is completing the first milestone for the project: process design definition and front end engineering design. The work includes a detailed review of the demonstration plant design and project implementation plan to ensure the project delivers its objectives in the most timely and effective manner. All aspects are being examined, including plant scale, validating performance of unit operations, product mix, vendor selection and project execution, with the intent to ensure the demonstration fully meets the project objectives within budget and with an immediate positive impact on the pulp mill operations.

• The Company had $33.1 million in cash at September

30, 2018 of which $8.0 million was restricted compared to $32.0 million at June 30, 2018 of which $7.9 million was restricted.

• During the third quarter of 2018, the Company spent

approximately $5.5 million on capital expenditures (including maintenance and projects) for continued operations. The Company also received $0.5 million in government grants in the quarter.

0

10

20

30

40

50

60

Q3-17 Q4-17 Q1-18 Q2-18 Q3-18

Mill

ion

s $

Quarterly Cash Balance

Cash and cash equivalents Restricted cash

10

11

-

2

4

6

Q3-17 Q4-17 Q1 -18 Q2 -18 Q3 -18

Mill

ion

s $

Consolidated SG&A from Continuing Operations by Nature

General & administrative Commission, sales & marketing

-

2

4

6

Q3-17 Q4-17 Q1-18 Q2-18 Q3-18

Mill

ion

s $

Consolidated SG&A from Continuing Operations by Segment

Pulp Bio-Products Corporate

Q3 2018 $ millions

Year Convertible Debt

Other Debt Total

2018 - 1,626 1,626

2019 62,100* 14,225 76,325

2020 - 14,225 14,225

2021 - 14,225 14,225

2022 - 14,225 14,225

Thereafter - 80,370 80,370

Total 62,100 138,897 200,996

Repayments of principal for debt outstanding as at September 30, 2018 are required as follows:

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* Subsequent to September 30, 2018, the Company extended the maturity date of the $62.1 million debentures from December 31, 2019 to December 31, 2021 and increased the interest rate from 7.0% to 9.75% per annum.

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This concludes the presentation for our third quarter results from operations We will now open up the lines for a Q&A