CASCADESReview of financial

results Q2 2010

August 11, 2010

2

DISCLAIMERCertain statements in this presentation, including statements regarding future results and performance, are forward-looking statements within the meaning of securities legislation based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the effect of general economic conditions, decreases in demand for the Company’s products, the prices and availability of raw materials, changes in the relative values of certain currencies, fluctuations in selling prices and adverse changes in general market and industry conditions. This presentation also includes price indices as well as variance and sensitivity analyses that are intended to provide the reader with a better understanding of the trends related to our business activities. These items are based on the best estimates available to the Company.

The financial information included in this presentation also contains certain data that are not measures of performance under Canadian GAAP (“non-GAAP measures”). For example, the Company uses earnings before interest, taxes, depreciation and amortization (EBITDA) because it is the measure used by management to assess the operating and financial performance of the Company’s operating segments. Such information is reconciled to the most directly comparable financial measures, as set forth in the “Supplemental Information on Non-GAAP Measures” section of our Annual Report.

Specific items are defined as items such as charges for impairment of assets, for facility or machine closures, debt restructuring charges, gains or losses on sales of business units, unrealized gains or losses on derivative financial instruments that do not qualify for hedge accounting, foreign exchange gains or losses on long-term debt and other significant items of an unusual or non-recurring nature.

3

OPENING REMARKSOPENING REMARKSOPENING REMARKSOPENING REMARKSOPENING REMARKSOPENING REMARKSOPENING REMARKSOPENING REMARKS

4

QUARTERLY HIGHLIGHTSQUARTERLY HIGHLIGHTSQUARTERLY HIGHLIGHTSQUARTERLY HIGHLIGHTS

•Net earnings per share of $0.22 compared to net earnings per share of $0.00 in the previous quarter.

•Operating income before depreciation and amortization (EBITDA) excluding specific items of $ 107 million, up 37% in comparison to Q1 2010.

•Cash flow from operations almost doubled to $71 million compared to $38 million in the first quarter of 2010.

•Improved business conditions and increased demand and selling prices in both North America and Europe.

•Total shipments up 3% compared to the first three months of the year and up 9% compared to the second quarter of 2009 (excluding the impact of acquisitions).

•Buy-back of 325,463 shares at an average price of $6.66 for a total amount of approximately $2.2 million during Q2 2010.

•Launch of a new antibacterial tissue hand towel, a world first in terms of hand hygiene.

5

Cash flow from operations (adjusted)

0102030405060708090100

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

1.0%

3.0%

5.0%

7.0%

9.0%

11.0%

(% of sales)EBITDA

30405060708090100110120130

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

(% of sales)

SUMMARY OF FINANCIAL RESULTSSUMMARY OF FINANCIAL RESULTSSUMMARY OF FINANCIAL RESULTSSUMMARY OF FINANCIAL RESULTS

Considerable increase in EBITDA & cash flow relative to Q1 2010Considerable increase in EBITDA & cash flow relative to Q1 2010

Year Q1 Q2 Q3 Q4 Year Q1 Q2

Financial results

Sales 4,017 970 981 974 952 3,877 942 998

Excluding specific items

EBITDA 306 107 121 127 110 465 78 107

Net earnings (loss) 4 21 28 35 26 110 0 21

Net earnings (loss) per share 0.04 0.22 0.28 0.36 0.27 1.13 0.00 0.22

Cash flow from operations (adjusted) 183 70 85 95 77 327 41 71

2008 2009

(In millions of CAN$, except amount per share)

2010

6

Boxboard

9 10

29

33

3

23

32 26

11

24

0

5

10

15

20

25

30

35Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

(% of sales)

Specialty products

15

21 2022

20

13

22

9

1819

0

5

10

15

20

25

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

(% of sales)

SEGMENTED EBITDASEGMENTED EBITDASEGMENTED EBITDASEGMENTED EBITDA

EBITDA excluding specific items.

IncreasedIncreased EBITDA for EBITDA for eacheach group group but but particularlyparticularly strongstrong in in containerboardcontainerboard

Tissue papers

39 38

24

19

35

4241

22

15 12

0 5 10 15 20 25 30 35 40 45

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

4.0%

7.0%

10.0%

13.0%

16.0%

19.0%

22.0%

(% of sales)

Containerboard

30

39

37

32 31

2830

3841

36

20

25

30

35

40

45

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

(M CAN$)

9.0%

12.0%

15.0%

18.0%

(% of sales)

7

Cascades North American manufacturing selling price

and raw material cost indices (US$)

900

1 000

1 100

1 200

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

Selling

prices

150

250

350

450

550

650

750

Raw material

costs

Selling prices index (US$) Raw materials index (US$);

PRICING AND COST ENVIRONMENTPRICING AND COST ENVIRONMENTPRICING AND COST ENVIRONMENTPRICING AND COST ENVIRONMENT

The spread between our selling price and raw material cost indicThe spread between our selling price and raw material cost indices es increased by 10% in Q2 2010increased by 10% in Q2 2010

EBITDA$107 M

EBITDA$121 M

EBITDA$127 M

EBITDA$110 M

EBITDA$78 M

EBITDA$107 M

See notes p. 28

8

FINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEWFINANCIAL REVIEW

9

Q2 2010 EBITDA VARIANCE ANALYSIS Q2 2010 EBITDA VARIANCE ANALYSIS Q2 2010 EBITDA VARIANCE ANALYSIS Q2 2010 EBITDA VARIANCE ANALYSIS

EBITDA excluding specific items

Even if the passEven if the pass--through of price hikes was not completed at converting level, through of price hikes was not completed at converting level, higher overall selling prices and volumes favourably impacted ouhigher overall selling prices and volumes favourably impacted our Q2 EBITDAr Q2 EBITDA

Containerboard 28 24 (2) 1 - (4) (8) 39Boxboard 23 6 5 2 1 (2) (6) 29Specialty products 18 4 - 1 2 (4) (1) 20Tissue 19 5 7 3 - (2) (8) 24Corporate (10) - - - 1 4 - (5)Consolidated 78 39 10 7 4 (8) (23) 107

107

78

7 (8)4

39

(23)10

0

20

40

60

80

100

120

140

160

Q1 2010 EBITDA Selling prices & mix Volumes Energy costs Variation of the CAN$ Cost improvements &

other items

Raw material costs &

mix

Q2 2010 EBITDA

(M$)

10

Total shipments & Manufacturing capacity

utilization rate

467 499 427 413 432 451 464 496 490

364352 311 330 334 324 353

511

341386390

0

200

400

600

800

1000

Q1 20

08

Q2 20

08

Q3 20

08

Q4 20

08

Q1 20

09

Q2 20

09

Q3 20

09

Q4 20

09

Q1 20

10

Q2 20

10

('000 s.t.)

75%

80%

85%

90%

95%

100%

Converting shipmentsManufacturing shipmentsManufacturing capacity utilization rate

KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KPIsKPIsKPIsKPIs))))

ShipmentsShipments continuedcontinued to to increaseincrease mostlymostly due to the due to the seasonalseasonal pickup in pickup in convertingconverting

875 853 889779 724 762 792 798

843820

See notes p. 28

11

KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KEY PERFORMANCE INDICATORS (KPIsKPIsKPIsKPIs))))

Volumes up 3% vs. Q1 2010 and 9%* vs. Q2 2009Volumes up 3% vs. Q1 2010 and 9%* vs. Q2 2009Capacity utilization rate reaching its best level since 2007Capacity utilization rate reaching its best level since 2007

*Excluding the acquisition of Atlantic Packaging’s tissue assets. See notes p. 28.

Year Q1 Q2 Q3 Q4 Year Q1 Q2

Total shipments (in '000 of s.t.)

Packaging 2,925 618 653 672 674 2,617 701 712

Tissue papers 471 106 109 120 124 459 119 131

Total 3,396 724 762 792 798 3,076 820 843

Capacity utilization rate - % 88% 81% 85% 89% 89% 86% 93% 96%

Integration rate (North America) - % 46% 48% 49% 49% 48% 49% 47% 51%

LTM Return on assets (%) 7.8% 8.9% 10.4% 11.4% 11.9% 11.9% 11.4% 11.1%

Working capital

In millions of $ 664 662 645 593 552 552 548 606

% LTM of sales 16.5% 16.4% 16.1% 15.0% 14.2% 14.2% 14.2% 15.7%

Financial

Operational

2008 2009 2010

12

50

56

107

(6)

(51)

0

20

40

60

80

100

120

EBITDA excl. spec. items Depreciation & amortization EBIT excl. spec. items Unreal. loss on finan. inst. Operating income

Q2 2010 EBITDA TO OP. INCOME RECONCILIATIONQ2 2010 EBITDA TO OP. INCOME RECONCILIATIONQ2 2010 EBITDA TO OP. INCOME RECONCILIATIONQ2 2010 EBITDA TO OP. INCOME RECONCILIATION

Container- Specialty Tissue Corporate

(in millions of Canadian dollars) Boxboard board Products Papers Activities

Operating income 14 21 11 14 (10) 50

Specific item:

Unrealized loss on financial instruments - 1 - 1 4 6

Total specific items - 1 - - 4 6

EBIT excluding specific items 14 22 11 15 (6) 56

Depreciation 15 17 9 9 1 51

EBITDA excluding specific items 29 39 20 24 (5) 107

Total

Q2 2010

600

(M$)

13

Q2 2010 NET EARNINGS RECONCILIATIONQ2 2010 NET EARNINGS RECONCILIATIONQ2 2010 NET EARNINGS RECONCILIATIONQ2 2010 NET EARNINGS RECONCILIATION

2121

(6)6

0

5

10

15

20

25

30

Net earnings

excluding spec.

items (non-GAAP)

F/X gain on long-

term debt

Unrealized loss on

finan. instr.

Net earnings

(GAAP)

(M$)

14

CASH FLOW OVERVIEWCASH FLOW OVERVIEWCASH FLOW OVERVIEWCASH FLOW OVERVIEW

Working capital variation negatively impacted FCF generation; Working capital variation negatively impacted FCF generation; expected rebound in second halfexpected rebound in second half

Free cash flow yield is defined as LTM FCF per share / share price end of period

Cash flow provided by operations

17

91

48

(31)

67

22

1178285

33

(60)

(30)

0

3060

90

120

150

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2009

(M CAN$)Free cash flow

43

-14-28-79

-91018 18

59

29

10%11%18%

-23%-13%-8%

8%17%-10%

15%

-100-75-50-25

0255075

100

Q1

20

08

Q2

20

08

Q3

20

08

Q4

20

08

Q1

20

09

Q2

20

09

Q3

20

09

Q4

20

09

Q1

20

10

Q2

20

09

($)

-40%

-20%

0%

20%

40%

60%

80%

100%

Free cash flow Free cash flow yield

(in millions of CAN$) Year Q1 Q2 Q3 Q4 Year Q1 Q2

Cash flow from operations 155 68 81 94 62 305 38 71

Working capital variation (31) (1) 1 23 29 52 (5) (54)

Cash flow provided by operations 124 67 82 117 91 357 33 17

Capital expenditures & other assets (183) (43) (35) (53) (57) (188) (36) (25)

Dividend & Share Buyback (20) (6) (4) (5) (5) (20) (6) (6)

Free cash flow (79) 18 43 59 29 149 (9) (14)

Free cash flow per share -0.80 $ 0.18 $ 0.44 $ 0.61 $ 0.30 $ 1.53 $ -0.09 $ -0.14 $

2008 2009 2010

15

NET DEBT RECONCILIATIONNET DEBT RECONCILIATIONNET DEBT RECONCILIATIONNET DEBT RECONCILIATION

Current availability** of approximately $375 M on credit facilitCurrent availability** of approximately $375 M on credit facilities ies

* Includes $79 M of net debt from unrestricted subsidiaries and joint ventures.** $450 M drawn from the credit facility and $17 M in letters of credit. Credit Agreement Borrowing Base amounts to $850M on a authorized amount of $850M.

Net debt up mainly due to change in working capital and F/X;Net debt up mainly due to change in working capital and F/X;current availability** of approximately $383 M on credit facilitcurrent availability** of approximately $383 M on credit facilities ies

1,553*1,508

253054

7 (71)

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

Net debt March31, 2010

Variation ofworking capital

Var. of F/X CAPEX andother assets

Dividend, stockbuyback &

others

Cash flow fromoperations

Net debt June30, 2010

(M$)

16* Includes $79 M of net debt from unrestricted subsidiaries and JVs in Q2 2010.

BALANCE SHEET & KEY FINANCIAL RATIOSBALANCE SHEET & KEY FINANCIAL RATIOSBALANCE SHEET & KEY FINANCIAL RATIOSBALANCE SHEET & KEY FINANCIAL RATIOS

Better debt ratios relative to same period last yearBetter debt ratios relative to same period last year

Year Q1 Q2 Q3 Q4 Year Q1 Q2

Total assets 4,031 4,041 3,886 3,877 3,792 3,792 3,764 3,796

Total debt 1,812 1,818 1,670 1,590 1,552 1,552 1,531 1,575

Net debt* 1,800 1,805 1,658 1,569 1,533 1,533 1,508 1,553

Shareholders' equity 1,256 1,289 1,309 1,335 1,304 1,304 1,271 1,280

Book value per share $12.79 $13.23 $13.43 $13.70 $13.41 $13.41 $13.11 $13.24

LTM EBITDA 306 354 412 451 465 465 436 422

LTM Interest 102 105 104 102 101 101 102 104

2008 2009 2010

Debt / Debt + Equity

54.6%

56.1%

58.5%59.1%

58.6%

59.0%59.9%

55.2%

54.4%54.3%

53.0%

54.0%

55.0%

56.0%

57.0%

58.0%

59.0%

60.0%

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

Net debt / LTM EBITDA

3.3

3.73.53.5

5.1

5.96.2

5.95.5

4.0

3.0

4.0

5.0

6.0

7.0Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

LTM EBITDA / LTM interest

4.6

4.14.3

2.83.0

2.83.0

3.4

4.0

4.4

2.5

3.0

3.5

4.0

4.5

5.0

5.5

Q1 2008

Q2 2008

Q3 2008

Q4 2008

Q1 2009

Q2 2009

Q3 2009

Q4 2009

Q1 2010

Q2 2010

17

SEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEWSEGMENTED REVIEW

18

PACKAGING PACKAGING PACKAGING PACKAGING ---- BOXBOARDBOXBOARDBOXBOARDBOXBOARD

North America / manufacturing

• Sales grew by $5 M due to the increase of volumes (7%) and the average selling price in US$ (4%).

• Operating income before depreciation and amortization (EBITDA) for North American manufacturing operations improved by $2 M as the lower energy costs and the growth of shipments more than offset the higher cost of virgin pulp.

• Price increases of 35 US$/s.t. for recycled paper grades and 40 US$/s.t. for virgin paper grades were partly implemented during the quarter. The implementation of these price hikes will continue in the upcoming quarters.

North America / converting

• Seasonally higher volumes in our quick-service restaurant packaging operations mostly explain the improved EBITDA.

Europe / manufacturing• In Europe, EBITDA rose although the euro depreciated and recycled fibre costs stayed relatively stable. In fact, the average selling price in euro, shipments and capacity utilization rate all continued to progress.

1 Numbers reflect the proportionate consolidation (36.15%) of the activities of Reno de Medici S.p.A.. EBITDA excluding specific items.

Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010

Manufacturing - N. America 68 63 5 3 7% 5% 98 93 699 681 680 654 825 790

Manufacturing - Europe1

112 114 8 6 7% 5% 154 145 726 770 € 555 € 534 € 663 € 663

Converting 162 153 17 15 10% 10% 71 66 2,283 2,317 2,226 2,226 n/a n/a

Others and eliminations (23) (20) (1) -1 - - (29) (26)

319 310 29 23 9% 8% 294 278

EBITDA margins

(% of sales)

Sales EBITDA Shipments

(in thousands s.t.)

Reference price

(in millions $) (in millions $) ($US or euro/s.t.)

Avg. Selling price Avg. Selling price

($CAN/s.t.) ($US or euro/s.t.)

19

PACKAGING PACKAGING PACKAGING PACKAGING ---- CONTAINERBOARDCONTAINERBOARDCONTAINERBOARDCONTAINERBOARD

1 Equals 2,893 million square feet (msf), $1,239 CAN/s.t. and $1,206 US/s.t. respectively in Q2 2010, and at 2,712 million square feet (msf), $1,198 CAN/s.t. and $1,151 US/s.t. respectively in Q1 2010. EBITDA excluding specific items.

Manufacturing• Sales and EBITDA increased significantly due to the implementation of a selling price hike of 60 US$/s.t. in April in North America. • Although we took downtime for maintenance in two of our mills, the capacity utilization rate remained relatively high at 95% in the

second quarter of 2010. The downtime had a significant impact on other fixed and variables costs.• The sequential decrease of North American old corrugated container (OCC) prices did not have a positive impact on results in the

second quarter of 2010. This was offset by higher freight expenses, a lower yield and the use of recycled fibre inventories acquired at higher costs in the previous quarter.

Converting• Sales progressed due to the increase in selling prices and shipments (+7% in msf relative to Q1 2010). The improvement in EBITDA

is also mainly explained by the seasonal growth in shipments.• The implementation of selling price hikes progressed well but not quickly enough to offset the appreciation of paper costs. Price

increase implementation will continue in the next quarter.

Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010

Manufacturing 148 134 17 6 11% 4% 301 298 491 450 477 432 640 580

Converting 217 194 26 21 12% 11% 1751

1621

751

721

731

691

n/a n/a

Others and eliminations (94) (73) (4) 1 - - (177) (155)

271 255 39 28 14% 11% 299 305

EBITDA margins

(% of sales) (in thousands s.t.) ($CAN/s.t. or msf)

Avg. Selling price

($US/s.t. or msf) ($US/s.t.)

Avg. Selling price Reference priceEBITDA Shipments

(in millions $)(in millions $)

Sales

20

Industrial Packaging

• The increase in sales (+6%) is mainly explained by the increased average selling price and demand. EBITDA stayed relatively stable while the previous factors offset the negative effect of higher raw material costs and additional provisions for bad debts.

Consumer Product Packaging

• The increase in EBITDA is mainly explained by a favourable seasonality and an improvement in selling prices in our plastic operations. In July, we started a new molded pulp machine which will allow us to improve capacity and financial results by the end of the year.

Specialty Papers• EBITDA remained relatively stable as our kraft paper operations profited from higher shipments and average selling prices while our deinked pulp operations enjoyed lower raw material costs. Our fine paper operations were however negatively affected by the lower seasonal demand, higher virgin pulp prices and a major downtime for annual maintenance.

• Construction of a recycled pulp unit began at our East Angus mill. This $10M investment will allow us to offer products that are more respectful of the environment, to increase our efficiency and to reduce various production costs. Work should be completed by the first quarter of 2011.

Recovery and Recycling• Despite a drop of selling prices, profitability of recovery operations stayed relatively flat. Moreover, we completed the acquisition of some paper shredding assets in the Toronto region.

PACKAGING PACKAGING PACKAGING PACKAGING –––– SPECIALTY PRODUCTSSPECIALTY PRODUCTSSPECIALTY PRODUCTSSPECIALTY PRODUCTS

EBITDA excluding specific items.

Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010

Industrial Packaging 49 46 6 6 12% 14% 50 48

Consumer Product Packaging 20 18 2 1 10% 5% n/a n/a

Specialty Papers 78 78 5 5 6% 7% 134 135 580 579 564 557

Recovery and Recycling 76 75 7 6 9% 8% n/a n/a

Others and eliminations (3) (2) - - - - (6) (7)

220 215 20 18 9% 9%

(% of sales)

Sales

(in millions $) (in millions $) (in thousands s.t.) ($CAN/s.t.)

EBITDA margins Avg. Selling price Avg. Selling price

($US/s.t.)

EBITDA Shipments

21

TISSUE PAPERSTISSUE PAPERSTISSUE PAPERSTISSUE PAPERS

• Sales increased by $22M or 11% due to the rebound in shipments and the improvement of our average selling price.

• Parent roll shipments rose by 2% relative to the previous quarter while shipments of converted products jumped by 16% (11,000 s.t.). This is mainly explained by the usual seasonal rebound in demand, the increase in promotional activities in the retail market and the continued growth in the Cascades brand. This performance compares to a 5% increase in converted product shipments for the U.S. industry².

• The average selling price in $US progressed by 3% as a result of the implementation in March of a $50/s.t. price hike on parent rolls as well as a more favourable sales ”mix”. In fact, shipments of converted products represented a more significant portion of total shipments.

• In June, we started the implementation of an additional $50/s.t. price hike on parent rolls of white paper. Moreover, we began to implement price increases in the away-from-home market (6 to 8 % in Canada and 9 to 11 % in the United States). These price increases have not impacted results yet. Prices in the retail market remained relatively stable.

• In addition to the favourable effect of increased selling prices and shipments, EBITDA was also positively affected by the lower energy costs. In contrast, the rise in virgin pulp and parent roll costs had a negative effect of $8M.

• In August, we will take a significant downtime at our Candiac mill to complete a major rebuild of one of our machines.

1 2002 = 1,000 combined tissue paper index in US$, with a constant sales mix (that of year 2006). EBITDA excluding specific items.2 Q2 2010 compared to Q1 2010. Source: RISI

Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010 Q2 2010 Q1 2010

Manufacturing and converting 220 198 24 19 11% 10% 130 119 1,652 1,619 1,608 1,555 1,623 1,617

Shipments Avg. Selling priceSales EBITDA

(in thousands s.t.) ($CAN/s.t.)(in millions $) (in millions $) ($US/s.t.) ($US/s.t.)

Avg. Selling price Reference price 1EBITDA margins

(% of sales)

22

Q & AQ & AQ & AQ & AQ & AQ & AQ & AQ & A

23

CONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKSCONCLUDING REMARKS

24

THIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOK

Business conditions continue to be healthy in all sectorsBusiness conditions continue to be healthy in all sectors

Boxboard

North America

Boxboard

EuropeContainerboard

Specialty

productsTissue papers

VolumeSlight

Decrease

Slight

Decrease

Slight

IncreaseStable

Slight

Increase

Selling pricesSlight

Increase

Slight

IncreaseIncrease Stable

Slight

Increase

Raw material

costsDecrease Stable Decrease Stable

Slight

Increase

25

While PPW OCC prices have dropped significantly between Q1 and QWhile PPW OCC prices have dropped significantly between Q1 and Q2, 2, other sources have reported a more modest declineother sources have reported a more modest decline

THIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOKTHIRD QUARTER OUTLOOKNorth American OCC reference (publication) prices

0

20

40

60

80

100

120

140

160

180

200

Jan 08

Mar 08

May 08

July 08

Sept 08

Nov 08

Jan 09

Mar 09

May 09

July 09

Sept 09

Nov 09

Jan 10

Mar 10

May 10

(US$/ton)

Dow Jones (New England) OBM No.11 (New England)PPW no. 11 (NY & Chicago)

OBM No.11

(New England)

Dow Jones (New

England)

PPW no. 11 (NY

& Chicago)

Q1 2010 137 149 156

Q2 2010 130 146 132

Difference -7 -2 -24

Browns

26

APPENDICESAPPENDICESAPPENDICESAPPENDICESAPPENDICESAPPENDICESAPPENDICESAPPENDICES

27

MARKET PRICES AND COSTS SUMMARYMARKET PRICES AND COSTS SUMMARYMARKET PRICES AND COSTS SUMMARYMARKET PRICES AND COSTS SUMMARY

Source: RISI, Dow Jones, Random Lengths and Cascades. See notes p. 28

2008 2009 2010

Q2 2010

Q2 2009

Q2 2010

Q2 2009

Q2 2010

Q1 2010

Q2 2010

Q1 2010

Average Average

Q1

Average

Q2

Average

Q3

Average

Q4

Average Average

Q1

Average

Q2

Average

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

Selling prices

Cascades North American US$ index (index 2005 = 1,000) 1,198 1,170 1,121 1,080 1,070 1,110 1,126 1,180 1,153 59 5% 54 5%

PACKAGING

Boxboard

North America (US$/ton)

Recycled boxboard - 20pt. Clay coated news (transaction) 764 768 745 743 759 754 790 825 808 80 11% 35 4%

Europe (Euro/tonne)

Recycled white-lined chipboard (GD2) index 649 628 603 590 585 601 590 634 612 31 5% 44 7%

Virgin coated duplex boxboard (GC2) index 994 1,006 988 970 966 982 973 1,010 992 22 2% 37 4%

Containerboard (US$/ton)

Linerboard 42-lb. unbleached kraft, East US (transaction) 582 578 543 537 530 547 580 640 610 97 18% 60 10%

Corrugating medium 26-lb. Semichemical, East U.S. (transaction) 561 548 513 507 500 517 550 610 580 97 19% 60 11%

Specialty products

(US$/ton, tonne for deinked pulp)

Recycled boxboard - 20pt. Bending chip (transaction) 601 600 555 548 555 565 575 625 600 70 13% 50 9%

Deinked pulp (f.o.b; U.S. air-dried & wet-lap, post-consumer) 740 585 570 595 653 601 708 752 730 182 32% 44 6%

Unbleached kraft paper, Grocery bag 30-lb. 958 937 920 920 927 926 960 1,020 990 100 11% 60 6%

Uncoated white 50-lb. offset, rolls 914 897 845 822 855 855 868 917 892 72 9% 49 6%

TISSUE PAPERS

Cascades Tissue papers (index 1999 = 1,000) 1,581 1,615 1,628 1,605 1,628 1,617 1,617 1,623 1,620 -5 0% 6 0%

Raw materials

Cascades North American US$ index (index 2005 = 300) 379 206 220 280 324 258 426 409 418 188 85% -18 -4%

RECYCLED PAPER

North America (US$/ton)

Corrugated containers, no. 11 (New england) 114 43 59 84 88 68 149 146 147 87 147% -3 -2%

Special news, no. 8 (ONP - Chicago & NY average) 115 32 45 65 83 56 90 92 91 47 104% 2 2%

Sorted office papers, no. 37 (SOP - Chicago & NY average) 188 90 90 125 174 120 225 198 211 108 120% -27 -12%

Europe (Euro/tonne)

Recovered mixed paper & board sorted index 55 12 21 35 44 28 68 73 70 52 248% 5 7%

VIRGIN PULP (US$/tonne)

Bleached softwood kraft Northern, East U.S. 857 677 643 733 820 718 880 993 937 350 54% 113 13% Bleached hardwood kraft Northern mixed, East U.S. 788 595 532 603 706 609 776 908 842 376 71% 132 17%

WOODCHIPS – Conifer eastern Canada (US$/odmt) 132 111 118 124 131 121 125 121 123 3 3% -4 -3%

Change

These indexes should only be used as indicator of trends and they be

different than our actual selling prices or purchasing costs.

Change

28

NOTESNOTESNOTESNOTES

1. The Cascades North American selling prices index represents an approximation of the Company’s manufacturing selling prices in North America (excluding Converting products). It is weighted according to shipments and is based on the average selling price of our North American manufacturing operations of boxboard, containerboard, specialty products and tissue paper. It considers the change in the mix of products sold. This index should only be used as a trend indicator.

2. The Cascades North American raw materials index represents the average weighted cost paid for some of our manufacturing raw materials namely, recycled fiber, virgin pulp and woodchips in North America. It is weighted according to the volume of purchase. This index should only be used as an a trend indicator and it may differ from our actual manufacturing purchasing costs and our purchase mix.

3. The capacity utilization rate is defined as: Shipments/Practical capacity. Paper manufacturing only.

4. Return on assets is a non-GAAP measure and is defined as: LTM EBITDA excluding specific items/ LTM Average of total quarterly assets. It includes discontinued operations.

5. Working capital includes accounts receivable plus inventories less accounts payable. It excludes an unpaid provision for closure and restructuring costs. It also excludes the current portion of derivatives financial instruments and the current portion of future taxes liability.

6. The Cascades recycled white-lined chipboard selling prices index represents an approximation of Cascades’ recycled grades selling prices in Europe. It is weighted by country. For each country we use an average of PPI and EUWID prices for white-lined chipboard. Historical prices were revised by EUWID in August 2008.

7. The Cascades virgin coated duplex boxboard selling prices index represents an approximation of Cascades’ virgin grades selling prices in Europe. It is weighted by country. For each country we use an average of PPI and EUWID prices for the coated duplex boxboard. Historical prices were revised by EUWID in August 2008.

8. The Cascades Tissue paper selling prices index represents a mix of primary and converted products, and is based on the product mix at the end of 2006.

9. The Cascades recovered mixed paper & board sorted prices index represents an approximation of Cascades’ recovered paper purchase prices in Europe. It is weighted by country. For each country we use an average of PPI and EUWID prices for the recovered mixed paper & board.

29CREDIT: IMAGE ECOterre

For more information:For more information:

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

Didier FilionDidier FilionDirector, Investor RelationsDirector, Investor Relationsdidier_filion@cascades.comdidier_filion@cascades.com514514--282282--26972697