News Column

West Fraser Announces Fourth Quarter Results

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VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/14/13 -- West Fraser Timber Co. Ltd. (TSX: WFT) today reported earnings of $22 million or $0.51 per share on sales of $773 million in the fourth quarter of 2012 and earnings of $87 million or $2.02 per share, on sales of $3 billion for 2012.

These results compare with previous periods as follows:

---------------------------------------------------------------------------($ millions except earnings per 2012 2011share ("EPS")) Q4 Q3 YTD YTD Q4---------------------------------------------------------------------------Sales 773 772 3,000 2,762 650EBITDA(1) 76 102 279 226 18Operating earnings 37 66 127 58 (22)Earnings (loss) from continuing operations 22 55 87 27 (11)Basic EPS from continuing operations ($) 0.51 1.27 2.02 0.63 (0.25)Adjusted earnings (loss) from continuing operations2 53 55 138 23 (15)Adjusted basic EPS from continuing operations ($)(2) 1.25 1.27 3.22 0.54 (0.35)Earnings 22 55 87 73 6Basic EPS ($) 0.51 1.27 2.02 1.70 0.14Diluted EPS ($) 0.51 1.27 2.02 1.47 0.14---------------------------------------------------------------------------1. In this News Release, reference is made to EBITDA (defined as operating earnings plus amortization). Our management believes that, in addition to earnings, EBITDA is a useful performance indicator and is a useful measure of cash available prior to debt service, capital expenditures and income taxes. Reference is also made to Adjusted earnings (loss) from continuing operations (calculated as set out in the tables described in footnote 2 and Adjusted EPS (collectively, with EBITDA, "these measures")). None of these measures is a generally accepted earnings measure under International Financial Reporting Standards ("IFRS") and none has a standardized meaning prescribed by IFRS. Investors are cautioned that none of these measures should be considered as an alternative to earnings, earnings per share or cash flow, as determined in accordance with IFRS. As there is no standardized method of calculating any of these measures, our method of calculating each of them may differ from the methods used by other entities and, accordingly, our use of any of these measures may not be directly comparable to similarly titled measures used by other entities.2. Refer to the tables titled "Annual Earnings Adjustments for Certain Non- Operational Items" and "Quarterly Earnings Adjustments for Certain Non- Operational Items" in Management's Discussion and Analysis of our 2012 results for details of adjustments.



"In the second half of 2012 we saw encouraging signs that the U.S. housing market is recovering," said Hank Ketcham, West Fraser's Chairman and CEO. "This has led to gradual improvement of results from our building products operations."

Operational Results

In the quarter our lumber operations generated operating earnings of $52 million (Q3 -$37 million) and EBITDA of $75 million (Q3 - $58 million). The improvement in our results reflects improved prices for SPF and SYP lumber.

The panel segment, which includes plywood, LVL and MDF, generated operating earnings in the quarter of $7 million (Q3 -$22 million) and EBITDA of $12 million (Q3 - $25 million) as Canadian dollar plywood prices weakened from third quarter levels.

Pulp and paper operations generated operating earnings in the quarter of $13 million (Q3 - $17 million) and EBITDA of $24 million (Q3 - $28 million). Improved NBSK pricing was offset by weakening BCTMP and newsprint markets.

Outlook

We are approaching 2013 with guarded optimism that the long-awaited U.S. housing recovery is taking hold. We will continue to invest in our existing facilities in order to maintain and improve our competitiveness.

Leadership Succession

The Company also announced that, as part of its ongoing leadership succession process, effective March 1, 2013 Hank Ketcham will assume the role of Executive Chairman and Ted Seraphim, who is currently the Company's President and Chief Operating Officer, will be appointed President and Chief Executive Officer. Mr. Seraphim will also be nominated for election as a director of the Company at the Company's April 30, 2013 Annual General Meeting.

Annual Financial Statements and Management's Discussion & Analysis ("MD&A")

The Company's consolidated financial statements for the year ended December 31, 2012 and related MD&A is available on the Company's website: www.westfraser.com and on the System for Electronic Document Analysis and Retrieval at www.sedar.com under the Company's profile.

Dividend Declared

The Board of Directors of the Company has declared a dividend of $0.14 per share on the Common shares and the Class B Common shares in the capital of the Company, payable on April 5, 2013 to shareholders of record on March 22, 2013.

The Company

West Fraser is an integrated wood products company producing lumber, wood chips, LVL, MDF, plywood, pulp and newsprint. The Company has operations in western Canada and the southern United States.

Forward-Looking Statements

This news release contains historical information, descriptions of current circumstances and statements about potential future developments. The latter, which are forward-looking statements and are included under the heading "Outlook", are presented to provide reasonable guidance to the reader but their accuracy depends on a number of assumptions and is subject to various risks and uncertainties. Actual outcomes and results will depend on a number of factors that could affect the ability of the Company to execute its business plans, including those matters described in the 2012 annual Management's Discussion & Analysis under "Risks and Uncertainties", and may differ materially from those anticipated or projected. Accordingly, readers should exercise caution in relying upon forward-looking statements and the Company undertakes no obligation to publicly revise them to reflect subsequent events or circumstances, except as required by applicable securities laws.

Conference Call

Investors are invited to listen to the quarterly conference call on Friday, February 15, 2013 at 8:30 a.m. Pacific Time (11:30 a.m. Eastern Time) by dialing 1-800-952-6845 (toll-free North America). The call may also be accessed through West Fraser's website at www.westfraser.com.

West Fraser shares trade on the Toronto Stock Exchange under the symbol: "WFT".

West Fraser Timber Co. Ltd.Condensed Consolidated Balance Sheets(in millions of Canadian dollars, except where indicated - unaudited) December 31 December 31 2012 2011---------------------------------------------------------------------------AssetsCurrent assetsCash and short-term investments $ 102 $ 68Receivables 251 266Income taxes receivable - 4Inventories (note 3) 459 398Prepaid expenses 11 9--------------------------------------------------------------------------- 823 745Property, plant and equipment 959 936Timber licences 496 490Goodwill and other intangibles 330 336Other assets 10 11--------------------------------------------------------------------------- $ 2,618 $ 2,518---------------------------------------------------------------------------LiabilitiesCurrent liabilitiesPayables and accrued liabilities $ 322 $ 274Income taxes payable 20 -Reforestation and decommissioning obligations 43 41--------------------------------------------------------------------------- 385 315Long-term debt 300 306Other liabilities 313 270Deferred income taxes 128 144--------------------------------------------------------------------------- 1,126 1,035---------------------------------------------------------------------------Shareholders' EquityShare capital 602 601Accumulated other comprehensive earnings (9) (6)Retained earnings 899 888--------------------------------------------------------------------------- 1,492 1,483--------------------------------------------------------------------------- $ 2,618 $ 2,518---------------------------------------------------------------------------Number of Common shares and Class B Common shares outstanding at February14, 2013 was 42,863,296.West Fraser Timber Co. Ltd.Condensed Consolidated Statements of Changes in Shareholders' Equity(in millions of Canadian dollars, except where indicated - unaudited) October 1 to December 31 January 1 to December 31 2012 2011 2012 2011---------------------------------------------------------------------------Retained earningsBalance - beginning of period $ 836 $ 902 $ 888 $ 943Actuarial gain (loss) on employee future benefits (net of tax) 47 (14) (52) (104)Earnings for the period 22 6 87 73Dividends (6) (6) (24) (24)---------------------------------------------------------------------------Balance - end of period $ 899 $ 888 $ 899 $ 888---------------------------------------------------------------------------Accumulated other comprehensive earningsBalance - beginning of period $ (12) $ 1 $ (6) $ (10)Translation gain (loss) on foreign operations 3 (7) (3) 4---------------------------------------------------------------------------Balance - end of period $ (9) $ (6) $ (9) $ (6)---------------------------------------------------------------------------Share capitalBalance - beginning of period $ 602 $ 601 $ 601 $ 601Issuance of Common shares - - 1 ----------------------------------------------------------------------------Balance - end of period $ 602 $ 601 $ 602 $ 601------------------------------------------------------------------------------------------------------------------------------------------------------Shareholders' equity $ 1,492 $ 1,483 $ 1,492 $ 1,483---------------------------------------------------------------------------Condensed Consolidated Statements of Earnings and Comprehensive Earnings(in millions of Canadian dollars, except where indicated - unaudited) October 1 to December 31 January 1 to December 31 2012 2011 2012 2011---------------------------------------------------------------------------Sales $ 773 $ 650 $ 3,000 $ 2,762---------------------------------------------------------------------------Costs and expensesCost of products sold 505 476 2,020 1,917Freight and other distribution costs 118 111 477 460Export taxes 11 15 48 58Amortization 39 40 152 168Selling, general and administration 33 26 115 104Equity-based compensation 30 4 61 (3)--------------------------------------------------------------------------- 736 672 2,873 2,704---------------------------------------------------------------------------Operating earnings 37 (22) 127 58Finance expense (5) (5) (19) (20)Exchange gain (loss) on long- term debt (3) 9 7 (7)Other income 2 1 - 14---------------------------------------------------------------------------Earnings from continuing operations before tax provision 31 (17) 115 45Tax recovery (provision) (note 4) (9) 6 (28) (18)---------------------------------------------------------------------------Earnings from continuing operations 22 (11) 87 27Earnings from discontinued operations (note 5) - 17 - 46---------------------------------------------------------------------------Earnings $ 22 $ 6 $ 87 $ 73---------------------------------------------------------------------------Earnings per share (dollars) (note 6)Basic from continuing operations $ 0.51 $ (0.25) $ 2.02 $ 0.63Diluted from continuing operations $ 0.51 $ (0.25) $ 2.02 $ 0.41Basic after discontinued operations $ 0.51 $ 0.14 $ 2.02 $ 1.70Diluted after discontinued operations $ 0.51 $ 0.14 $ 2.02 $ 1.47---------------------------------------------------------------------------Comprehensive earningsEarnings $ 22 $ 6 $ 87 $ 73Other comprehensive earningsTranslation gain (loss) on foreign operations 3 (7) (3) 4Actuarial gain (loss) on employee future benefits 47 (14) (52) (104)---------------------------------------------------------------------------Comprehensive earnings $ 72 $ (15) $ 32 $ (27)---------------------------------------------------------------------------West Fraser Timber Co. Ltd.Condensed Consolidated Statements of Cash Flows(in millions of Canadian dollars, except where indicated - unaudited) October 1 to December 31 January 1 to December 31 2012 2011 2012 2011---------------------------------------------------------------------------Operating activitiesEarnings from continuing operations $ 22 $ (10) $ 87 $ 27 Adjustments Amortization 39 40 152 168 Finance expense 5 5 19 20 Exchange loss (gain) on long-term debt 3 (9) (7) 7 Tax provision (recovery) 9 (6) 28 18 Income taxes received (paid) (1) - 2 (75) Reforestation and decommissioning obligations (3) - (2) 6 Employee future benefits expense 9 7 38 35 Contributions to employee future benefit plans (39) (64) (64) (93) Other 1 (3) (8) (9)Changes in non- cash working capital Receivables 2 32 (22) 8 Inventories (36) (40) (58) (24) Prepaid expenses 2 4 (2) (1) Payables and accrued liabilities 8 (7) 32 (2)---------------------------------------------------------------------------Cash flows from operating activities 21 (51) 195 85---------------------------------------------------------------------------Financing activitiesRepayment of operating loans - - - (15)Finance expense paid (8) (9) (18) (20)Dividends (6) (6) (24) (24)Other (1) - - ----------------------------------------------------------------------------Cash flows from financing activities (15) (15) (42) (59)---------------------------------------------------------------------------Investing activitiesAcquisition (30) - (30) -Additions to capital assets (44) (89) (150) (213)Proceeds from Green Transformation Program 4 5 49 37Proceeds from disposal of capital assets - - 9 10Other 2 1 3 2---------------------------------------------------------------------------Cash flows from investing activities (68) (83) (119) (164)---------------------------------------------------------------------------Change in cash from continuing operations (62) (149) 34 (138)Change in cash from discontinued operations - 9 - 45Cash - beginning of period 164 208 68 161---------------------------------------------------------------------------Cash - end of period $ 102 $ 68 $ 102 $ 68---------------------------------------------------------------------------



West Fraser Timber Co. Ltd.

Notes to Condensed Consolidated Interim Financial Statements

(figures are in millions of dollars, except where indicated - unaudited)

1. Nature of operations

West Fraser Timber Co. Ltd. ("West Fraser", "we", "us" or "our") is an integrated wood products company producing lumber, wood chips, LVL, MDF, plywood, pulp and newsprint with facilities in western Canada and the southern United States. Our executive office is located at 858 Beatty Street, Suite 501, Vancouver, British Columbia. West Fraser was formed by articles of amalgamation under the Business Corporations Act (British Columbia) and is registered in British Columbia, Canada. We are listed on the Toronto Stock Exchange under the symbol WFT.

2. Basis of presentation and statement of compliance

These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting as issued by the International Accounting Standards Board and using the same accounting policies and methods of their application as the December 31, 2012 annual financial statements. These condensed consolidated interim financial statements should be read in conjunction with the Company's 2012 annual financial statements.

3. Inventories

Inventories at December 31, 2012 were written down by $3 million (September 30, 2012 - $6 million; December 31, 2011 - $15 million) to reflect net realizable value being lower than cost.

4. Tax provision

The tax provision differs from the amount that would have resulted from applying the Canadian statutory income tax rates to earnings before income taxes as follows:

-------------------------------------------------------------------------- October 1 to December 31 January 1 to December 31 2012 2011 2012 2011---------------------------------------------------------------------------Income tax expense at statutory rate of 25% (2011 - 26.5%) $ (8) $ 4 $ (29) $ (12)Non-taxable amounts (5) 2 (9) 2Rate differentials between jurisdictions and on specified activities - 1 (1) 6Recognized (unrecognized) tax assets 3 (1) 11 (12)Other 1 - - (2)---------------------------------------------------------------------------Tax recovery (provision) $ (9) $ 6 $ (28) $ (18)------------------------------------------------------------------------------------------------------------------------------------------------------



5. Discontinued operations

We permanently closed our linerboard and kraft paper mill, located in Kitimat, B.C. in January 2010 and the windup was substantially completed in December 2011.

6. Earnings per share

Basic earnings per share is calculated based on earnings available to Common shareholders, as set out below, using the weighted average number of Common shares and Class B Common shares outstanding.

Diluted earnings per share is calculated based on earnings available to Common shareholders adjusted to remove the actual share option expense (recovery) charged to earnings and after deducting a notional charge for share option expense assuming the use of the equity settled method, as set out below. The diluted weighted average number of shares is calculated using the treasury stock method. When earnings available to Common shareholders for diluted earnings per share are greater than earnings available to Common shareholders for basic earnings per share, the calculation is anti-dilutive and diluted earnings per share are deemed to be the same as basic earnings per share.

October 1 to December 31 2012 2011--------------------------------------------------------------------------- From After From After continuing discontinued continuing discontinued operations operations operations operations---------------------------------------------------------------------------EarningsBasic $ 22 $ 22 $ (11) $ 6Share option expense 23 23 3 3---------------------------------------------------------------------------Diluted $ 45 $ 45 $ (8) $ 9---------------------------------------------------------------------------Weighted average number of shares (thousands)Basic 42,862 42,862 42,845 42,845Share options 675 675 280 280---------------------------------------------------------------------------Diluted 43,537 43,537 43,125 43,125---------------------------------------------------------------------------Earnings per share (dollars)Basic $ 0.51 $ 0.51 $ (0.25) $ 0.14Diluted $ 0.51 $ 0.51 $ (0.25) $ 0.14--------------------------------------------------------------------------- January 1 to December 31 2012 2011--------------------------------------------------------------------------- From After From After continuing discontinued continuing discontinued operations operations operations operations---------------------------------------------------------------------------EarningsBasic $ 87 $ 87 $ 27 $ 73Share option expense (recovery) 45 45 (6) (6)Equity settled share option adjustment (3) (3) (3) (3)---------------------------------------------------------------------------Diluted $ 129 $ 129 $ 18 $ 64---------------------------------------------------------------------------Weighted average number of shares (thousands)Basic 42,857 42,857 42,840 42,840Share options 555 555 434 434---------------------------------------------------------------------------Diluted 43,412 43,412 43,274 43,274---------------------------------------------------------------------------Earnings per share (dollars)Basic $ 2.02 $ 2.02 $ 0.63 $ 1.70Diluted $ 2.02 $ 2.02 $ 0.41 $ 1.47---------------------------------------------------------------------------



7. Segmented information

Pulp & Corporate Lumber Panels paper & other Consolidated---------------------------------------------------------------------------October 1, 2012 to December 31, 2012Sales at market prices To external customers $ 477 $ 109 $ 187 $ - $ 773 --------------- To other segments 18 1 - ----------------------------------------------------------- $ 495 $ 110 $ 187 $ -----------------------------------------------------------EBITDA(1) $ 75 $ 12 $ 24 $ (35) $ 76Amortization (23) (5) (11) - (39)---------------------------------------------------------------------------Operating earnings 52 7 13 (35) 37Finance expense (2) (1) (2) - (5)Exchange loss on long-term debt - - - (3) (3)Other income (expense) (1) - 4 (1) 2---------------------------------------------------------------------------Earnings from continuing operations before tax provision $ 49 $ 6 $ 15 $ (39) $ 31---------------------------------------------------------------------------1. Non-IFRS measure:EBITDA is defined as operating earnings plus amortization. Pulp & Corporate Lumber Panels paper & other Consolidated---------------------------------------------------------------------------October 1, 2011 to December 31, 2011Sales at market prices To external customers $ 370 $ 93 $ 187 $ - $ 650 --------------- To other segments 22 1 - ----------------------------------------------------------- $ 392 $ 94 $ 187 $ -----------------------------------------------------------EBITDA(1) $ (8) $ 4 $ 26 $ (4) $ 18Amortization (22) (4) (13) (1) (40)---------------------------------------------------------------------------Operating earnings (30) - 13 (5) (22)Finance expense (2) (1) (1) (1) (5)Exchange gain on long-term debt - - - 9 9Other income (expense) 2 - (6) 5 1---------------------------------------------------------------------------Earnings from continuing operations before tax provision $ (30) $ (1) $ 6 $ 8 $ (17)---------------------------------------------------------------------------1. Non-IFRS measure:EBITDA is defined as operating earnings plus amortization. Pulp & Corporate Lumber Panels paper & other Consolidated---------------------------------------------------------------------------January 1, 2012 toDecember 31, 2012Sales at market prices To external customers $ 1,783 $ 442 $ 775 $ - $ 3,000 --------------- To other segments 72 6 - ---------------------------------------------------------------------------- $ 1,855 $ 448 $ 775 $ ----------------------------------------------------------------------------EBITDA(1) $ 180 $ 55 $ 109 $ (65) $ 279Amortization (86) (16) (48) (2) (152)---------------------------------------------------------------------------Operating earnings 94 39 61 (67) 127Finance expense (10) (3) (6) - (19)Exchange gain on long-term debt - - - 7 7Other income (expense) (4) - 1 3 ----------------------------------------------------------------------------Earnings from continuing operations before tax provision $ 80 $ 36 $ 56 $ (57) $ 115---------------------------------------------------------------------------1. Non-IFRS measure:EBITDA is defined as operating earnings plus amortization. Pulp & Corporate Lumber Panels paper & other Consolidated---------------------------------------------------------------------------January 1, 2011 to December 31, 2011Sales at market prices To external customers $ 1,579 $ 370 $ 813 $ - $ 2,762 --------------- To other segments 91 8 - ---------------------------------------------------------------------------- $ 1,670 $ 378 $ 813 $ ----------------------------------------------------------------------------EBITDA(1) $ 65 $ 8 $ 148 $ 5 $ 226Amortization (85) (15) (65) (3) (168)---------------------------------------------------------------------------Operating earnings (20) (7) 83 2 58Finance expense (11) (3) (6) - (20)Exchange loss on long-term debt - - - (7) (7)Other income 10 - 3 1 14---------------------------------------------------------------------------Earnings from continuing operations before tax provision $ (21) $ (10) $ 80 $ (4) $ 45---------------------------------------------------------------------------1. Non-IFRS measure:EBITDA is defined as operating earnings plus amortization.



The geographic distribution of external sales is as follows:

---------------------------------------------------------------------------- October 1 to December 31 January 1 to December 31 2012 2011 2012 2011----------------------------------------------------------------------------United States $ 368 $ 318 $ 1,435 $ 1,303Canada 194 157 747 652China 139 96 513 456Other Asia 47 53 201 229Other 25 26 104 122---------------------------------------------------------------------------- $ 773 $ 650 $ 3,000 $ 2,762--------------------------------------------------------------------------------------------------------------------------------------------------------



Sales distribution is based on the location of product delivery by the Company.



Contacts:
West Fraser Timber Co. Ltd.
Larry Hughes
Vice-President, Finance and Chief Financial Officer
(604) 895-2700

West Fraser Timber Co. Ltd.
Rodger Hutchinson
Vice-President, Corporate Controller
(604) 895-2700
(604) 681-6061 (FAX)
www.westfraser.com