CanWel Building Materials Announces Record Second Quarter 2010 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 second quarter fiscal 2010 financial results for the period
ended June 30, 2010.


During the three-month period ended June 30, 2010(1) CanWel reported sales of
$404 million compared to $185 million for the comparable period in 2009. For the
quarter, the Company reported gross margin of $43.7 million or 10.8 percent of
sales versus $25.4 million or 13.7 percent of sales in 2009. These results
represent the first full quarter of operations from the Broadleaf Logistics
Company ("BLC") acquisition, and increased pricing and volume for construction
materials experienced compared to the second quarter of 2009. The Company's
sales mix was 48% construction materials for the quarter, and the gross margin
percentage reflects this change compared to the second quarter of 2009. Net
income amounted to $10.0 million compared to net income of $7.4 million during
the same period in 2009. 


For the quarter, EBITDA(2) increased by 71 percent to a record $17.4 million
compared to $10.2 million for the comparable period last year. The second
quarter results represent record sales, EBITDA and net income levels in the
Company's operating history. 


"I am very proud and pleased to report record revenues and earnings generated by
the combination of CanWel and Broadleaf Logistics during our first full quarter
as one company," noted Amar S. Doman, Chairman and CEO of the Company. "While
our record sales and earnings in the second quarter are due to strong
operational efficiencies, higher pricing on certain building materials, and
robust demand in most regions of the country, we continue to work on our
integration efforts which are expected to further strengthen the foundation of
our earnings profile."


Reconciliation of Net Income to Earnings before Interest, Tax, Depreciation and
Amortization (EBITDA):




---------------------------------------------------- ---------------------- 
                                  Three months ended      Six months ended  
                                        June 30                June 30      
(in thousands of dollars)             2010      2009         2010      2009 
                                                                            
------------------------------------------  -------- ------------  -------- 
------------------------------------------  -------- ------------  -------- 
Net Earnings                      $ 10,026  $  7,416     $ 14,203  $  6,968 
Income tax provision (recovery)      4,118       193        5.309    (1,746)
Cash interest expense                1,551       709        2,813     1,504 
Depreciation of property plant                                              
 and equipment                         812     1,323        1,713     2,641 
Amortization of intangible and                                              
 other assets                          501       395          865       793 
Amortization of deferred gain         (18)       (19)        (36)       (37)
Amortization of financing costs        293        64          468       128 
Amortization of promissory notes         -        32           11        64 
Stock-based compensation               152       106          199       277 
                                                                            
------------------------------------------  -------- ------------  -------- 
EBITDA                            $ 17,435  $ 10,219     $ 25,545  $ 10,592 
                                                                            
Acquisition and conversion costs        91         -          595         - 
Realized foreign exchange gain           -         -       (1,102)        - 
                                                                            
------------------------------------------  -------- ------------  -------- 
Adjusted EBITDA before one time                                             
 items                            $ 17,526  $ 10,219     $ 25,048  $ 10,592 



About CanWel Building Materials

CanWel Building Materials trades on the Toronto Stock Exchange under the symbol
CWX and is Canada's largest national distributor in the building materials and
related products sector, operating distribution centres coast to coast in all
major cities and strategic locations across Canada. CanWel Building Materials
distributes a wide range of hardware, building materials, lumber, and renovation
products. Further information can be found in the disclosure documents filed by
CanWel Building Materials (and its predecessor, CanWel Building Materials Income
Fund) 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 free cash flow(2),
dividends or EBITDA(2) generated 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 would include (i) the risk that the integration of the acquisition
of Broadleaf Logistics Company completed on February 1, 2010 (the "Acquisition")
may result in significant challenges, and management of CanWel may be unable to
accomplish the integration 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 Broadleaf Logistics 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 of
Broadleaf Logistics Company (some of whom are competitors of CanWel) will cease
doing business with the Broadleaf Logistics Company or CanWel, 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 and interest rate risks. In addition, there
are numerous risks associated with an investment in units/shares, as well as
other risks and factors, which are also further described in the "Risk Factors"
section of our annual information form dated March 30, 2010, our management
information circulars dated December 17, 2009 and March 31, 2010, and our other
public filings on SEDAR. Additional risks and uncertainties affecting CanWel,
which could cause results to differ materially from those described in these
forward-looking statements, include, among others: increased debt and interest
costs, general economic and business conditions, pension funding risk, product
selling prices, product performance, design and liability risk, software and
software design risk, information systems risk, interest rate changes, operating
costs, legislative changes, accounting pronouncements and competitive
conditions. A further description of these and other factors can be found in the
periodic and other reports filed by CanWel with Canadian securities commissions
and available on SEDAR (http://www.sedar.com). 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 Q2 2010 MD&A for further information. 

(2) Reference is made above to EBITDA. We define EBITDA as earnings before
interest expense, provision for income taxes, gain or loss on sale of fixed
assets, depreciation and amortization, goodwill impairment and stock-based
compensation expense. We also consider free cash flow in our financial planning,
which we define as operating earnings before changes in non-cash working capital
and after maintenance of business capital expenditure and contributions to any
reserves the Board of Directors of the Company deem to be reasonable and
necessary for the operations of the Company. Please refer to our Q2 2010 MD&A
for further information.


EBITDA is a measure used by management of CanWel to evaluate financial
performance. EBITDA is not a measure of earnings or financial performance
recognized by Canadian generally accepted accounting principles (''GAAP'') and
does not have standardized meanings prescribed by GAAP. Items excluded from
EBITDA are significant to understanding and assessing financial performance.
EBITDA should not be considered in isolation or as alternatives to net income,
cash flows generated by operations or other financial statement data presented
in the consolidated financial statements of the Company, as indicators of
financial performance or liquidity under GAAP. Because EBITDA is not a measure
determined in accordance with GAAP, as presented, investors are cautioned that
EBITDA may not be comparable to similarly-titled measures presented by other
issuers. 


(3) Basic and Diluted weighted average number of shares outstanding used for Q2
2010 per share calculations were 60,665,538, and 60,815,538, respectively.