Erika Reilly – Chief Financial Officer Mark Bishop – President and Chief Executive Officer Brian Banfill – Chief Operating Officer

Paul Quinn – RBC Capital Markets David Quezada – Raymond James Andrew Kuske – Credit Suisse

Thank you operator, and good morning. Welcome to Acadian's first quarter conference call.

Before we get started, I would like to remind everyone of the following. This conference call is being webcast simultaneously through our website at acadiantimber.com, where you can also find a copy of the press release including the financial statements.

Please note, that in responding to questions and talking about our first quarter financial and operating performance, as well as our outlook for the remainder of 2016, we may make forward-looking statements. These statements are subject to known and unknown risks and future results may differ materially.

For further information on known risk factors, I encourage you to review Acadian's annual information form dated March 30, 2016 and other filings of Acadian with securities regulatory authority which are available on SEDAR at sedar.com and on our website. I will now start by outlining the financial highlights for the quarter then Mark Bishop, Acadian's Chief Executive Officer, will provide comments about operations, market conditions, and our outlook for remainder of 2016.

Acadian's operations ran well during the first quarter. Operating conditions in New Brunswick was typically for the winter season, but the Maine operations experienced warmer and less favorable conditions than in the winter of the prior year.

Demand for hardwood continued to be strong, but markets for softwood pulpwood particularly remains challenging. Net sales for the first quarter totaled $21.4 million, a $3.2 million or 13% decrease compared to the same period in 2015.

The year-over-year decrease in net sales is almost entirely attributable to a 13% decrease in sales volume. The weighted average log price did increased 3% year-over-year, but this was offset modestly by lower revenue from Acadian management services contract on the Crown licensed timberlands.

The increase log price reflects stronger hardwood prices at New Brunswick operation and the positive impact of the Canadian dollar that offset weaker prices for our softwood in Maine. Reflecting the decrease sales volume, adjusted EBITDA was $7 million compared to $8 million during the same period in 2015.

Adjusted EBITDA margin was 33%, down from 35% the same period last year as the increase in the weighted average logs price was offset by some longer haul distances in Maine and the negative impact of the Canadian dollar on U.S. dollar dominating costs.

Free cash flow was down $1.4 million from the first quarter of 2015 to $6.2 million and the payout ratio was 68% compared to 55% in the prior year after adjusting the prior results for the year-over-year increase in the dividend rate. Acadian’s net income totaled $4.3 million or $0.26 per share for the first quarter up from the loss of $2.9 million or $0.17 per share from the same period in 2015.

The year-over-year increase is primarily due to the recording of a $4.1 million unrealized exchange gain on long-term debt this year compared to a $7.7 million loss in the same period of the prior year. Other factors effecting net income included a $5.2 million increase in deferred tax expense, mostly due to the 2% increase to the New Brunswick provincial tax rate enacted on April 1, 2016 and a $1.7 million decrease in fair value adjustment due to the lower harvest volumes.

I will now briefly review the segmented results for Acadian’s New Brunswick and Maine operations. Net sales from our New Brunswick operations for the first quarter totaled $13.9 million compared to $15.3 million for the same period last year.

A 12% decrease in sales volume was partially offset by a 6% in the weighted average log selling price. The 7% decrease in harvest volume reflects a most typical weather condition this year that led to an earlier reduction of operations due to mud season as compared to last year.

The weighted average selling price across all logs was $69.87 per cubic meter in the first quarter of 2016, up $3.97 per cubic meter from the same period last year. This year-over-year increase in the average log selling price reflects gains in hardwood sawlogs and pulpwood prices partially offset by modest decline in softwood prices.

Costs for the first quarter of 2016 were $9 million as compared to $10 million in the comparable quarter of 2015. The decrease was due to a lower harvest volume with variable costs per cubic meter increasing just 1% from the prior year.

First quarter adjusted EBITDA for the New Brunswick operations was $5 million, down slightly from $5.3 million in the first quarter of 2015. Adjusted EBITDA margin increased to 36% from 35% in the prior year on the strength of hardwood sales prices.

At the Maine operations, sales volumes were down 16% year-over-year and Canadian dollar based log selling prices fell 1%. This combination of factors caused net sales for the first quarter of 2016 to dropped $1.9 million from the prior year to $7.5 million.

Well hardwood volumes remain stable, less favorable weather conditions then in the prior year along with current challenges in the softwood pulpwood market in the region, resulted in a significant drop in softwood volume. The weighted average log selling price in Canadian dollar terms was $80.63 per cubic meter in the first quarter, down $81.71 in the prior year.

Weighted average log selling prices in U.S. dollar terms decreased 11% year-over-year as improved hardwood sawlog prices were more than offset by lower prices for all other log products.

Costs for the first quarter were $5.2 million compared to $5.59 million during the same period in 2015. The positive effect of lower harvest volume was almost fully offset by a 16% increase in variable cost per unit in Canadian dollar term.

In U.S. dollar terms variable cost per unit climbed 5%, primarily due to longer haul distances for hardwood pulplogs.

Adjusted EBITDA for the Maine operations for the first quarter was $2.3 million compared to $3.9 million for the same period in 2015, reflecting both lower sales revenue and higher costs. Adjusted EBITDA margin fell 30% from 41% in the prior year.

Switching over from the operations to our cash position, at the end of the first quarter Acadian had cash on hand totaling approximately $20.5 million, which is $4 million higher than the cash balance at the same time last year. The primary driver of the increase cash balance was the generation of $5.2 million of free cash in excess of dividend payments over the last 12 months, offset by an increase in working capital resulting from higher log inventory at the New Brunswick operations.

The current cash balance is $2.8 million higher than the balance at the end of the fourth quarter of 2015, reflecting the free cash flow generation in the quarter and a modest decrease in working capital as higher inventory levels were offset by lower account receivable and higher account payable balances. As of March 26, 2016, Acadian had net liquidity of $97.9 million, including funds available under Acadian's revolving facility and our stand-by equity commitment with Brookfield, compared to $98.5 million as at December 31, 2015.

The decreased liquidity reflects the higher cash balance offset by the impact of a stronger Canadian dollar on the revolving facility in equity commitment, which are denominated in U.S. dollars.

During the quarter we declared a dividend of $0.25 per share to our shareholders consistent with the prior quarter. I will now turn the call over to Mark.

Thanks Erika. Just starting with safety, during the quarter Acadian’s operations experienced two recordable incidents; one involving an employee and one involving a contractor, both incidents resulted in some lost time, but the resulting injuries were relatively minor in nature.

We continue to work with our contractors and employees to ensure the highest standards workplace safety are maintained. Acadian continues to benefit from strong hardwood markets and high operating rates among our softwood sawmilling customers supported by the steady recovery in the U.S.

housing market. As Erika mentioned, Acadian's weighted average log selling price for the first quarter increased 3% year-over-year, stronger hardwood prices in New Brunswick operations and the positive impact of the weaker Canadian dollar on U.S.

denominated sales more than offset weaker prices for softwood logs. Hardwood sawlog and pulpwood markets remained strong with weighted average selling prices for sawlogs increasing 13%, and prices for pulpwood increasing 10%.

Softwood sawlog prices in Maine weakened considerably, however as customers struggled with lower lumber and residual pricing. Softwood pulp markets continue to be oversupplied and markets in Maine aren’t affected, but closed at the present time, causing us to sell this product into the biomass market.

This remains our most challenging product as the number of groundwood pulp customers operating in the region continued to declined, but as we've noted many times in the past this product makes up only a small portion of Acadian sales and even lower portion of our operating earnings. Biomass markets for the New Brunswick operations remains strong with margins more than double those in prior year, primarily reflecting continued sales to export markets.

Acadian’s financial outlook for 2016 remains positive, while U.S. economic growth was relatively flat during the first quarter of 2016, most of services do not consider this weakness as signaling the start deteriorating U.S.

economic activity. In fact, a healthy labor market, evidence by a solid hiring trend seen during the past few months and stronger household incomes are expected to support a pickup in consumer spending that should drive improved economic performance through the remaining quarters of 2016.

The fundamentals for a continued recovery in residential construction activity, including low interest rates, a sustained improvement in the labor market and rising personal incomes among young adults should continue to draw more potential homebuyers into the housing market. Consensus for 2016 U.S.

housing start expectations remains strong at 10% year-over-year growth, although construction labor supply and availability of new building sites are noted as potential constraints. Benchmark softwood lumber prices for the first quarter remained flat from the previous quarter and are generally expected to remain flat on a full year-over-year basis.

Housing start momentum has been positive, but ongoing weakness in offshore export markets and recent U.S. lumber mill capacity additions continue to be a drag on pricing.

In addition, the combination of the weak Canadian dollar and the absence of softwood lumber duties due to the expiry of the SLA in late 2015 is expected to drive continued strong mill utilization rates in Canada for the remainder of the year. Almost all regional sawmills continue to operate on full shifts and appear to be carrying inventories at or near typical levels.

We expect softwood sawlog demand to remain stable through 2016, ongoing challenges for softwood sawmill residual demand in Maine have negatively impacted softwood sawlog pricing in the market, although prices do appear to have stabilized. Hardwood sawlog remained strong during the first quarter and are expected to remain at current favourable levels.

While we continue to expect hardwood pulpwood markets to experience moderation in 2016 as the region adapts to announce paper mill closures in Maine, they have remained resilient. On biomass markets they remain generally positive in New Brunswick, but the recent loss in renewable energy significance from Massachusetts to Connecticut Maine’s commercial biomass energy generator significantly curtailed operations during the quarter.

Recent legislature back in public subsidies may assists one or two of these facilities to restart, but that remains only a temporary solution. While an increase in investments in regional domestic and export bound pellet capacity may provide relief in the medium term, there is minimal visibility on market-based catalysts to more broadly support the curtailed biomass generators.

As we noted in prior quarters which we have been very active in the pursuit of growth opportunities, Acadian has been challenged with very aggressive competition for Timberland investments as we have discussed throughout many in the past few quarters. In this context, we believe that was prudent to take a step back to review a range of strategic alternatives then initiatives including a possible sale or all our parts of the business, our merger or other business combination or other strategic transactions.

Our process which included a detailed internal review with management and the board was initiated in late October, but as you know it was press released in early February. This process which is now been concluded allowed us to reevaluate and confirm that Acadian was on the right path to maximize value to shareholders over the long-term.

A special committee has determined that it’s in the best interest of Acadian shareholders to continue to seek growth on an opportunistic basis, while management continues to operate the company with a discipline focus on maximizing value. In conclusion, we’d like to take this opportunity to remind our investors that Acadian benefits from a strong balance sheet, diverse markets and an experienced and dedicated operating team, and I emphasize with a clearly demonstrated best-in-class track record that remains committed to continuously improving our financial performance.

These factors give us a considerable confidence that Acadian is well positioned to continue to deliver solid financial performance and meet his dividend target for 2016 and beyond. We thank you for your continued support of Acadian and remain committed to continuously improving our financial and operating performance.

That concludes our formal remarks and we’re available to take any questions from participants on the line. Operator?

Thanks and good morning. I can appreciate you had difficult weather on a year-over-year comparison, just wondering if the weather affect that you primarily experience in Maine, I know you can make up the volume for the rest of the year i.e.

are you going to get back to somewhere around 300,000 meters?

Paul, I think you’ll see that the weather certainly wasn’t impacting the first quarter and significant part of that volume as you're aware with softwood pulp. I wouldn’t expect us to make up all of that volume in the remaining quarters unless certainly we see a significant change in the markets.

Okay. And then just on the strategic review, we’ve seen some strong Timberland sales especially in the U.S., maybe you can comment on the level of interest you received on both Maine and New Brunswick Timberlands?

So, I think that was two questions, Paul. The first question was strong activity in the market, and you're right, I guess Reid you announced very recently its acquisition and I guess subsequent sale, and certainly there was continued interest and looks like 2016 may be a busy year for some segments of the Timberland market in terms of transactions.

I can’t really comment any specifically on any of our activity. As we've indicated, we had a range of potential alternative strategies that we reviewed, but I can’t really comment on any specific activity or details within that –other than the fact that we’re going to continue to communicate with all of you as we progress in implementing those initiatives.

Okay. Last question I had with just on softwood lumber, New Brunswick received an exemption last one, just wondering if you expect to repeat?

I do. I mean, as you know the structure of the industry in Atlantic province and in New Brunswick has not changed from the last [indiscernible] I think most of our fears in the East, in the Maritimes would certainly expect that we're going to be treated in a similar fashion since the last call around.

Certainly there is a lot of uncertainty heading into this and I’ve talked about it very recently, but we do expect to see very similar treatment of the Maritime Provinces.

All right. Best of luck.

Thanks Paul.

Thanks. Hi, guys.

My first question, I know in the release you mentioned longer haul distances for hardwood logs, is that something that you expect be relatively temporary impact or is that something that we should expect to see going forward?

That’s a good question, David. I think we’ve seen particularly one of our customers who is implementing a new – couple of tissue machines in our volume heading in that direction has increased.

So overall, I think we’re going to see at least for the remainder of the year are likely similar impact on hardwood margins due to the transportation in Maine, but that really reflects what we’ve seen in the last couple of quarters is an increase in operations in certain areas and the curtailments in other areas have caused the shifting in fiber flow. And so far that's likely to be a more stable shift I guess over the next several quarters and unless we see any new developments, obviously we saw Rumford announced that it was opening up an additional machine again on some specialty paper and that will create some additional volume, but incrementally it’s a fairly low amount of volume and certainly will not provide a significant offset for us.

Okay, great. That’s helpful.

Thank you. And then just I know in New Brunswick, you saw some good results from the export markets.

I am just wondering, I know it’s not a huge portion of your overall volumes. But how big is the opportunity there and you see the potential to increase that as a proportion of shipments going forward?

You’re right. It is a small part of our business, although it has been increasing, and I think this year over last we were seeing – Brain, I think we were targeting at least a couple of additional shipments.

Yeah, I assuming the reference, it’s a biomass.

It’s a biomass.

Yeah.

So no, we certainly continue to expect to see a exports, and well we called it biomass, I think we have stated on prior calls that a fair amount of that volume was actually going into a panel market in Europe, so well biomass was actually being – it wasn’t being referring to news for energy, some of it was, but certainly where our growth was coming from was actually targeted at a different market for us, which certainly is continuing to get more interesting for us.

Okay, great. Thank you.

My last question just very broadly on the outlook for M&A, I know in the past you commented that you’re looking at Latin America, and I believe Australia and New Zealand. Are there any broad trends globally for Timber M&A that I guess maybe you can comment on as it relates to potential opportunistic growth for you?

Yeah. I wouldn’t suggest there was any sort of significant developments in trends in M&A, although some of the Australasian activity I would suggest may be have slowdown somewhat and you’re going to see a pickup I think this year as I mentioned and through the year, a pickup in U.S.

transactions. So, there is certainly – we would expect to see potentially larger scale transactions in 2016.

As kimos are continuing to approach our extent to finalize, they are needed to come back to the market. So we will see I think an increase in activity in 2016 in U.S.

market, so that’s really the key trends. Brazil really remains an interesting market from many perspectives and well we’re active there.

We wouldn’t expect at this point to see Acadian participating in Brazil transactions I think for some of the reasons we talked about before.

Okay, great. Thanks very much.

That’s all I had.

Good morning. It's actually Andrew for Paul.

Maybe if you could give us a little bit of color just on the public-private market valuation divide that tends to exists where we’re seeing certain assets embedded within private funds maybe having more aggressive valuations, and then also enabling them to go out and be more aggressive in the bidding process versus what we’re seeing embedded within public company valuations?

That’s a good question, Andrew. The public company valuations obviously get clouded by a combination of factors, including the overall marketing – and broader market and trading activity, and we’ve seen – certainly seen that being relatively volatile for the U.S.

REITs this year and obviously the implied valuation on an non-timber assets. And I think the warehouse are recent transaction with IP on the pulp assets is an interesting one, I think that probably had a range of values that many of the followers would have attributed to that that would have ultimately had an influence on the residual timber value approaching it from some of the parts message.

I guess when we do and we continue to do a lot of work on the U.S. REITs, we look at them obviously from a public information perspective, but we look at them in the same way we would look at any other Timberlands.

We wouldn’t generally believe that our feel that there is a significant discount in the public market to Timberlands. In fact, I think – again depending on this specific name, we would probably have a different perspective completely.

So, it’s very difficult to compare the two because you're comparing and certainly for analysts using public market information, you really not comparing assets at a detail enough level including knowledge of inventory and growth in yield to be able to compare them appropriately.

Okay. Thanks very helpful.

I guess maybe carrying that thought process through on just the results of this strategic review and the conclusions as you're in [indiscernible] for Acadian value, what should we extrapolate? And then I guess a follow-up to that is you do have a clear path reviewed growth located in the future?

Well, I guess, first of all, I think I’ll go back to one of the comments that I sort of alluded to is that we’re quite proud of our track record and in fact that we’ve been able to grow the dividend quite nicely with the assets that we have and we’ll continue to have a best-in-class payout ratio very competitive with many – is not better than many of our peers. As we mentioned we’re to maintain a focus on opportunistic growth.

We think in certain markets we can be very competitive and obviously we need to demonstrate that and understand that we would not being doing that so far with respect to transaction, you know closing any transactions, but we do think we can be competitive in certain markets. In the meantime, we do have other opportunities and initiatives that we will focus on some that are obviously were not specifically identifying in our materials, but there are initiatives that we’re focusing on with management and we’ll be able to talk about them once we are closer into to achieving them.

But there are significant – small, but significant initiatives that we can embark on and how, I think that we’ll see how there are positive impact on our cash flow and our performance.

Okay. That’s helpful.

And then maybe if I may just one final question properly to Erika on the comment around longer haul distances affecting a bit of the economics. Are you at the point now where you feel like you're lapping better conditions as far as the gas prices are generally off versus a year ago?

Are you getting more favorable trucking rates from hauling perspective that couldn’t for the economics in the future?

No, a non-materially, no.

Okay. Thank you.

Again, thank you all for participating in our call and your ongoing support of Acadian and we look forward to speaking with you at our next quarter.