CanWel Building Materials Announces Fourth Quarter & Full Year 2012 Financial Results

NOT FOR RELEASE OR DISSEMINATION INTO THE UNITED STATES 

CanWel Building Materials Group Ltd. ("CanWel" or "the Company") (TSX:CWX)
announced today its 2012 fourth quarter and year-end financial results for the
period ended December 31, 2012. 


For the year ended December 31, 2012, revenues amounted to $711 million compared
to $693 million in 2011. The 2.6 percent increase in revenue relates primarily
to improved market conditions for construction materials in 2012 and additional
treated wood sales volumes. The additional treated wood sales volumes were
supported by the purchase of the North West Wood Treaters treating plant assets
in the first quarter of 2012. Other factors having a meaningful impact on the
Company's volume of sales included the Company's ongoing focus on its customers
and the market development of its product portfolio. The Company's sales in the
year were made up of 56 percent of construction materials compared to 50 percent
in 2011, with the balance resulting from specialty and allied products. The
increase in sales of construction materials is attributable to the improved
market conditions in this category relative to 2011. Gross margin dollars
increased to $76.6 million in the year compared to $76.5 million in 2011. Gross
margin percentage was 10.8 percent in the year, a slight decrease compared to
the 11.0 percent achieved in 2011. This change in margin percentage is mainly
due to an increase in sales of the lower margin construction materials compared
to 2011. As a result, net income(2) for the year increased to $8.0 million
versus $685,000 during 2011. 


EBITDA for the year ended December 31, 2012 was $20.1 million compared to $9.8
million in 2011, an increase of 105 percent. The EBITDA for 2011 was impacted by
one-time integration costs of $5.0 million, offset by insurance recovery of $1.9
million. Adjusted EBITDA(4) before these one-time items was $20.1 million
compared to $12.9 million in 2011, for an increase of 55.8 percent. 


In the year ended December 31, 2012, the Company repurchased and cancelled a
total of 3,423,800 common shares pursuant to its 2011 Normal Course Issuer
Bid(5) at an average price of $2.24. 


For the three month period ended December 31, 2012(1), CanWel reported revenues
of $150.4 million compared to $138.3 million for the same period in 2011. Gross
margin during the fourth quarter of 2012 amounted to 10.4 percent or $14.9
million versus 9.8 percent or $13.5 million in the fourth quarter of 2011.
EBITDA for the three months ended December 31, 2012 totaled $123,000 compared to
$821,000. EBITDA in the fourth quarter of 2011 was impacted by one-time
integration costs of $1.0 million as well as recoveries of $1.9 million. As a
result, adjusted EBITDA before these one-time items was $123,000 compared to
negative $46,000 in the fourth quarter of 2011, representing an improvement of
$169,000 compared to 2011. 


"CanWel's financial performance in 2012 is indicative of the overall strength of
our business model. Last year had its challenges from a macroeconomic
perspective with continued volatility in our business segment, however thanks to
our ongoing focus on managing costs, dedicated employees and profitable revenue
growth, we are very pleased to report revenue growth, and more importantly a 105
percent year-over-year increase in EBITDA," noted Amar S. Doman, Chairman and
CEO of the Company. "While 2013 will have its own unique story with Canadian
finance officials continuing to take steps to moderate debt levels and the
housing market, 2013 has nevertheless started off at an encouraging pace with
demand and volumes pointing in the right direction, providing us with a
cautiously optimistic view in the near to midterm."


Reconciliation of Net Income to EBITDA:



----------------------------------------------------------------------------
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(in thousands of dollars)       Three months ended               Year ended 
                                                                            
                           December 31 December 31  December 31 December 31 
                                  2012        2011         2012        2011 
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Net (loss) earnings            ($1,485)    ($1,733)      $8,000       ($685)
Income tax (recovery)                                                       
 provision                        (497)        211        2,911       1,221 
Cash interest expense            1,182         991        4,862       4,365 
Depreciation of property,                                                   
 plant and equipment               413         736        2,210       2,177 
Amortization of intangible                                                  
 assets                            250         250        1,000       1,000 
Amortization of financing                                                   
 costs                             260         332        1,039       1,310 
Share-based compensation             -          34          103         440 
                                                                            
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EBITDA                            $123        $821      $20,125      $9,828 
                                                                            
Integration costs                    -       1,000            -       5,020 
                                                                            
Insurance recovery                   -      (1,867)           -      (1,867)
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Adjusted EBITDA                   $123        ($46)     $20,125     $12,981 
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About CanWel Building Materials 

CanWel Building Materials trades on the Toronto Stock Exchange under the symbol
CWX and is one of Canada's largest national distributors in the building
materials and related products sector, operating distribution centres coast to
coast in all major cities and strategic locations across Canada. CanWel
distributes a wide range of building materials, lumber and renovation products.
Further information can be found in the disclosure documents filed by CanWel
with the securities regulatory authorities, available at www.sedar.com. 


Certain statements in this press release may constitute "forward-looking"
statements. When used in this press release, such statements use words,
including but not limited to, "may", "will", "expect", "believe", "plan",
"intend", "anticipate", "future" and other similar terminology. These
forward-looking statements reflect the current expectations of CanWel's
management regarding future events and operating performance, but involve known
and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of CanWel, including the cash flow from
operations, dividends or EBITDA(3) generated or paid by CanWel, or industry
results, to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Actual
events could differ materially from those projected herein and depend on a
number of factors. These factors include (i) the risk that the integration of
the acquisition of the assets of Northwest Wood Preservers ("NWP") completed in
quarter 1, 2012 or Broadleaf Logistics Company ("BLC") completed on February 1,
2010 (collectively the "Acquisition") may result in significant challenges, and
management of CanWel may be unable to accomplish the integration or post
integration management of the Acquisition smoothly or successfully or without
spending significant amounts of time, money or other resources thereon; any
inability of management to successfully integrate the operations of the combined
business, including, but not limited to, information technology and financial
reporting systems, any of which could have a material adverse effect on the
business, financial condition and results of operations of CanWel; (ii) the risk
that revenues, profits and margins of the Company may not remain consistent with
historical levels, (iii) the risk that competing firms which manufacture or
distribute competitive product lines will aggressively defend or seek market
share, or that existing customers or suppliers of NWP or BLC (some of whom are
competitors of CanWel) will cease doing business with the Company, in each case
reducing, eliminating or reversing any potential positive economic impact on
CanWel of the Acquisition; (iv) the risk that any increased sales, margin,
profit or distributable cash resulting from the Acquisition may not be fully
realized, realized at all or may take longer to realize than expected; (v) the
risk of disruption from the integration of the Acquisition making it more
difficult to maintain relationships with customers, employees or suppliers. 

Factors also include, but are not limited to, dependence on market and economic
conditions, sales and margin risk, competition, information system risks,
availability of supply of products, risks associated with the introduction of
new product lines, product design risk, environmental risks, volatility of
commodity prices, inventory risks, customer and vendor risks, acquisition and
integration risks, availability of credit, credit risks, litigation risks and
interest rate risks. A further description of these and other risks which could
cause results to differ materially from those described in these forward-looking
statements can be found in the periodic and other reports filed by CanWel with
Canadian securities commissions and available on SEDAR (http://www.sedar.com)
and the reader is encouraged to review such disclosure. In addition, a number of
material factors or assumptions were utilized or applied in making the
forward-looking statements, and may include, but are not limited to, assumptions
regarding the performance of the Canadian economy, the relative stability of
interest rates, volatility of commodity prices, more limited availability of
access to equity and debt capital markets to fund, at acceptable costs, the
Company's future growth plans, the implementation and success of the integration
of the Acquisition, the ability of the Company to refinance its debts as they
mature, the Canadian housing and building materials market; the amount of the
Company's cash flow from operations; tax laws; and the extent of the Company's
future acquisitions, factors considerations and factors germane to such
acquisitions and capital spending requirements or planning as well as the
general level of economic activity, in Canada, and abroad, discretionary
spending, uptake of the Company's NCIB program(5) and unemployment levels.


These forward-looking statements speak only as of the date of this press
release. CanWel does not undertake, and specifically disclaims, any obligation
to update or revise any forward looking information, whether as a result of new
information, future developments or otherwise, except as required by applicable
law. 




(1)   Please refer to our Q4 and Full Year 2012 MD&A and Financial          
      Statements for further information. Our 2012 filings are reported     
      under International Financial Reporting Standards ("IFRS").           
                                                                            
(2)   Before accounting for "Other Comprehensive Income"; please refer to   
      our Q4 and Full Year 2012 Financial Statements for further            
      information.                                                          
                                                                            
(3)   In the discussion, reference is made to EBITDA, which represents      
      earnings from continuing operations before interest, provision for    
      income taxes, gain or loss on sale of fixed assets, depreciation and  
      amortization, goodwill impairment loss and stock-based compensation.  
      This is not a generally accepted earnings measure under IFRS and does 
      not have a standardized meaning under IFRS, the measure as calculated 
      by the Company may not be comparable to similarly-titled measures     
      reported by other companies. EBITDA is presented as we believe it is a
      useful indicator of relative operating performance. EBITDA should not 
      be considered by an investor as an alternative to net income or cash  
      flows as determined in accordance with IFRS.                          
                                                                            
(4)   In the discussion, reference is made to Adjusted EBITDA, which is     
      EBITDA as defined in (3) above, before certain one time or unusual    
      items. This is a non-IFRS measure, and does not have a standardized   
      meaning under IFRS, the measure as calculated by the Company may not  
      comparable to similarly-titled measures reported by other companies.  
      Adjusted EBITDA is presented as we believe it is a useful indicator of
      the Company's ability to meet debt service and capital expenditure    
      requirements from its regular business, before non-recurring items.   
      Adjusted EBITDA should not be considered by an investor as an         
      alternative to net income or cash flows as determined in accordance   
      with IFRS.                                                            
                                                                            
(5)   Please also refer to the forward looking statement information in our 
      November 19, 2012 news release for additional forward looking         
      statement information and cautions pertaining to the Company's Normal 
      Course Issuer Bid ("NCIB"), which are hereby incorporated by          
      reference, and as may also be applicable to the Plan or NCIB as the   
      case may be. Although CanWel intends to purchase common shares and or 
      convertible debentures for cancellation under its NCIB and / or the   
      Plan, there can be no assurances that any such purchases will be      
      completed. Please refer to our public disclosure filings for the      
      latest information on the NCIB.                                       



FOR FURTHER INFORMATION PLEASE CONTACT: 
CanWel Building Materials Group Ltd.
Ali Mahdavi
Investor Relations
416-962-3300 or [phone]
[e-mail]