HispanicBusiness

The accompanying notes are an integral part of these condensed consolidated financial statements.

Canfor Pulp Products Inc.

Condensed Consolidated Statements of Other Comprehensive Income (Loss)

                                                   3 months ended March 31,(millions of Canadian dollars, unaudited)                 2013         2012---------------------------------------------------------------------------                                                                   (Note 1)Net income                                         $      10.9  $      10.0Other comprehensive income (loss)Items that will not be recycled through net income:  Defined benefit plan actuarial gains (losses)   (Note 4)                                                0.3        (2.8)  Income tax recovery (expense) on defined   benefit plan actuarial (gains) losses (Note 6)        (0.1)          0.7---------------------------------------------------------------------------Other comprehensive income (loss), net of tax              0.2        (2.1)---------------------------------------------------------------------------Total comprehensive income                         $      11.1  $       7.9------------------------------------------------------------------------------------------------------------------------------------------------------Total comprehensive income attributable to:Controlling interest in the Partnership            $      11.1  $       3.6Non-controlling interests in the Partnership (Note 11)                                                   -          4.3---------------------------------------------------------------------------Total comprehensive income                         $      11.1  $       7.9------------------------------------------------------------------------------------------------------------------------------------------------------

                                                   3 months ended March 31,(millions of Canadian dollars, unaudited)                 2013         2012---------------------------------------------------------------------------                                                                   (Note 1)Share capitalBalance at beginning of period                     $     525.3  $     294.9Exchange transaction (Note 11)                               -        230.4---------------------------------------------------------------------------Balance at end of period                           $     525.3  $     525.3---------------------------------------------------------------------------Retained earnings (deficit)Balance at beginning of period                     $   (138.7)  $    (67.3)Exchange transaction (Note 11)                               -       (57.8)Net income excluding amount attributable to non- controlling interests in the Partnership                 10.9          5.7Defined benefit plan actuarial gains (losses), net of tax                                                0.2        (2.1)Dividends declared                                       (3.6)            ----------------------------------------------------------------------------Balance at end of period                           $   (131.2)  $   (121.5)---------------------------------------------------------------------------Total equity attributable to equity holders of the Company                                       $     394.1  $     403.8------------------------------------------------------------------------------------------------------------------------------------------------------Non-controlling interests in the PartnershipBalance at beginning of period                     $         -  $     226.1Net income attributable to non-controlling interests in the Partnership                                -          4.3Exchange transaction (Note 11)                               -      (230.4)---------------------------------------------------------------------------Balance at end of period                           $         -  $         ----------------------------------------------------------------------------Total equity                                       $     394.1  $     403.8------------------------------------------------------------------------------------------------------------------------------------------------------