Clearwater Paper (CLW) 8-K Regulation FD Disclosure

CLEARWATER PAPER

CORPORATION

SEPTEMBER

2015

Exhibit 99.1

FORWARD LOOKING

STATEMENTS

2

This

presentation

contains,

in

addition

to

historical

information,

certain

forward-looking

statements

within

the

meaning

of

the

Private

Securities

Litigation

Reform

Act

of

1995,

including

statements

regarding

North

American

tissue

demand

and

capacity,

U.S.

paperboard

demand,

Chinese

paperboard

competition,

business

strategies,

EBITDA

margins

and

model,

measures

to

address

market

dynamics,

strategic

capital

projects

and

financial

impact,

and

Adjusted

EBITDA

run-rate.

Words

such

as

“anticipate,”

“expect,”

“intend,”

“will,”

“plan,”

“goals,”

“objectives,”

“target,”

“project,”

“believe,”

“schedule,”

“estimate,”

“may,”

and

similar

expressions

are

intended

to

identify

such

forward-looking

statements.

These

forward-looking

statements

are

based

on

management’s

updated

expectations,

estimates,

assumptions

and

projections

that

are

subject

to

change.

Our

actual

results

of

operations

may

differ

materially

from

those

expressed

or

implied

by

the

forward-looking

statements

contained

in

this

presentation.

Important

factors

that

could

cause

or

contribute

to

such

differences

include

the

risk

and

uncertainties

described

from

time

to

time

in

our

public

filings

with

the

Securities

and

Exchange

Commission,

as

well

as

the

following:

•

competitive pricing pressures for our products, including as a result of increased capacity as additional manufacturing facilities are operated by our competitors;

•

paperboard customers may adjust inventory levels through decreased purchasing;

•

customer acceptance, timing and quantity of purchases of our new through-air-dried, or TAD products, or other tissue products;

•

announced price increases for our products may not be accepted in whole or part;

•

the loss of or changes in prices in regards to a significant customer;

•

changes in transportation costs and disruptions in transportation services;

•

manufacturing or operating disruptions, including equipment malfunction and damage to our manufacturing facilities caused by fire or weather-related events and IT

system failures;

•

changes in the cost and availability of wood fiber and wood pulp;

•

labor disruptions;

•

changes in costs for and availability of packaging supplies, chemicals, energy and maintenance and repairs;

•

environmental liabilities or expenditures;

•

changes in the U.S. and international economies and in general economic conditions in the regions and industries in which we operate;

•

changes in customer product preferences and competitors' product offerings;

•

changes in expenses and required contributions associated with our pension plans;

•

reliance on a limited number of third-party suppliers for raw materials;

•

cyclical industry conditions;

•

inability to successfully implement our operational efficiencies and expansion strategies;

•

inability to fund our debt obligations;

•

restrictions on our business from debt covenants and terms; and

•

changes in laws, regulations or industry standards affecting our business.

Forward-looking

statements

contained

in

this

presentation

present

management’s

views

only

as

of

the

date

of

this

presentation

or

as

indicated.

We

undertake

no

obligation

to

publicly

update

forward-looking

statements,

whether

as

a

result

of

new

information,

future

events

or

otherwise.

OVERVIEW OF

CLEARWATER PAPER

3

INTRODUCTION TO

CLEARWATER PAPER

WE ARE A COMPANY FORMED IN LATE 2008 WITH MORE

THAN 60 YEARS OF OPERATING HISTORY

WE OPERATE

TWO BUSINESS SEGMENTS

Pulp and paperboard: 40% of 2014 net sales

Consumer products: 60% of 2014 net sales

FINANCIAL OVERVIEW FOR 2014

Net Sales: $2.0 Billion

Adjusted EBITDA¹: $240 Million

2008 to 2014 Adjusted EBITDA¹ CAGR: 21%

APPROXIMATELY 3,300 EMPLOYEES

4

See

Appendix

for

the

definition

of

Adjusted

EBITDA

as

well

as

the

reconciliation

to

the

most

comparable

GAAP

measure.

1

CONSUMER PRODUCTS DIVISION

OVERVIEW

Clearwater Paper is one of the LARGEST NORTH AMERICAN

MANUFACTURERS OF PRIVATE LABEL TISSUE, focused on high value

tissue products across all categories, retail channels and geographies.

5

CONSUMER PRODUCTS DIVISION

MARKET DRIVERS

STABLE

GROWTH

–

The

tissue

market

has

grown

an

average

of

100

104

107

113

114

117

119

121

124

124

124

127

129

127

130

132

134

137

139

141

143

269

273

276

279

282

285

288

290

293

296

298

301

304

307

311

313

315

316

319

321

324

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

e

e

e

e

U.S. TISSUE

DEMAND

(INDEXED)

U.S. POPULATION

(MM)

Source: U.S. Tissue demand per RISI for North America only from US Tissue Data January 2015, U.S. Population per U.S. Census December 2012

6

1

%

–

2

%

annually since 1996, consistent with population growth.

CONSUMER PRODUCTS DIVISION

CAPACITY AND RETAIL CHANNELS

OVERVIEW OF FACILITIES

Tissue Production Capacity¹: 433,000 tons

Tissue Conversion Capacity¹: 435,000 tons

Clearwater Paper Tissue Parent Roll

Clearwater Paper Tissue Converting

Represents

2014

annual

volumes

excluding

specialty

mills

IRI

Panel

data

for

Retail

channel

share

by

dollar

amount

sold

as

of

Jan.

5,

2015.

Company

sales

data.

Change in Industry

Retail Channel Mix

U.S. TISSUE INDUSTRY

RETAIL

CHANNEL MIX

2009

2014

Grocery

37

%

33

%

Mass

+

Supercenter

28

%

31

%

Club

22

%

23

%

Drug

7

%

5

%

Dollar

3

%

4

%

All Other

3

%

4

%

Clearwater Paper Focus on

Diversifying Channel Mix

CLEARWATER PAPER RETAIL

CHANNEL MIX

2011

2014

Grocery

82

%

68

%

Mass

+

Supercenter

10

%

19

%

Drug

2

%

2

%

Dollar

6

%

10

%

All Other

1

%

7

Lewiston,ID

Las Vegas,NV

Oklahoma City, OK

Shelby, NC

Elwood, IL

Neenah, WI

Lady

Smith, WI

1

2

3

³

²

PRIVATE LABEL CONTINUES TO

CAPTURE MARKET SHARE IN TISSUE

Clearwater Paper ranks as one of the LARGEST NORTH

AMERICAN PRIVATE LABEL TISSUE MANUFACTURERS

Private Label Market Share

of Total U.S.

2014 U.S. Retail Tissue

Industry Product Mix

60

%

29

%

Tissue

7

%

4

%

Source: IRIWorldwide. Dec. 2014.

8

60%

0%

10%

20%

30%

40%

50%

60%

Bath Tissue

Paper Towels

Facial Tissue

Napkins

Total

Private Label

2003

2011

2012

2013

2014

15%

18%

26%

43%

18%

20%

32%

25%

52%

25%

21%

32%

27%

49%

26%26%

21%

33%

30%

48%

22%

33%

31%

54%

27%

OPPORTUNITY FOR PRIVATE LABEL

AND CLEARWATER PAPER TO GROW

MARKET SHARE NATIONALLY

Clearwater

Paper

Market

Share by

Region

WEST

MID-WEST

EAST

Clearwater Paper

17.2

%

8.0

%

5.3

%

Brand Names

69.3

%

73.6

%

73.0

%

Other

Private Label

13.5

%

18.4

%

21.7

%

Source:  IRIWorldwide. January 2015

14.7%

5.2%

4.0%

6.3%

16.4%

5.9%

4.1%

6.9%

16.8%

6.3%

4.5%

7.3%

17.2%

8.0%

5.3%

8.1%

WEST

MID-WEST

EAST

TOTAL MARKET

2011

2012

2013

2014

2011

2012

2013

2014

2011

2012

2013

2014

2011

2012

2013

2014

9

NORTH AMERICAN

MARKET

DEMAND VS. CAPACITY

Longer Term Market Remains in Equilibrium

Source: RISI May 2015 update for Outlook for World Tissue Business and company estimates, RISI June 2015 US Tissue Monthly Data

It

is

assumed

that

any

productivity

improvements

(approximately

100k

per

year

or

1%

of

capacity)

will

be

offset

by

closures

over

a

cycle.

Notes: Projected capacity changes represents both virgin and recycled tissue capacity changes. Please see Appendix for breakdown of specific projects reflected in the capacity changes.

10

9,506

9,788

10,382

9,803

594

0

2,000

4,000

6,000

8,000

10,000

12,000

2014

Tissue Demand

2014

Tissue Capacity

Projected

New Capacity

Projected 2016

Tissue Capacity

Projected 2016

Tissue Demand

1

2014 DEMAND TO CAPACITY

RATIO OF 97%

2016

E

DEMAND

TO

CAPACITY

RATIO OF 94%

9,506

9,788

10,382

9,803

594

1

1

PAPERBOARD DIVISION

OVERVIEW

LEADING MANUFACTURER OF SBS

1

used in packaging of premium

consumer goods, pharmaceuticals, food and liquid, and food service plates,

cups and folding cartons.

11

1

Solid Bleach Sulfate paperboard

12

PAPERBOARD DEMAND REMAINS

STABLE

NORTH AMERICA DEMAND FOR SBS BASED PRODUCTS

EXPECTED TO REMAIN STABLE THROUGH 2016

•

North American industry backlogs are below seasonal averages and Clearwater Paper expectations in Q3 2015

•

The strong U.S. dollar is attracting European SBS manufacturers, pressuring U.S. exports

•

China’s ivory board is expected to have minimal impact on Clearwater Paper in 2015

•

Secular trend away from foam (polystyrene) cups and products continues

Source: RISI estimates as of January 2015

¹ Based on tons produced. Projections based on North American Packaging papers and board demand estimates per RISI.

² Average price per short ton of 16 pt. SBS folding carton C1S. Price estimates per RISI.

U.S. BLEACHED

PAPERBOARD

DEMAND

U.S. BLEACHED

PAPERBOARD

PRICE

U.S. GDP % CHANGE

100

105

103

108

102

100

100

101

106

108

108

109

108

97

101

98

100

102

104

105

107

$

760

$

810

$

740

$

713

$

773

$

728

$

700

$

727

$

713

$

772

$

817

$

851

$

961

$

1,020

$

1,082

$

1,150

$

1,122

$

1,130

$

1,155

$

1,157

$

1,163

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

3.7

%

4.5

%

4.4

%

4.8

%

4.1

%

1.1

%

1.8

%

2.5

%

3.6

%

3.1

%

2.7

%

2.1

%

0.4

%

-2.6

%

2.8

%

1.7

%

2.8

%

1.9

%

2.8

%

3.3

%

2.9

%

e

e

(INDEXED)

1

($/SHORT

TON

)

2

PULP AND PAPERBOARD DIVISION

CAPACITY AND MARKETS

Clearwater

Paper

ranks

as

one

of

the

top

five

largest

paperboard manufacturers in North America

Lewiston Mill

ID

Cypress Bend Mill

AR

OVERVIEW OF FACILITIES

Pulp Production Capacity

1

: 856,000 tons

Paperboard Production Capacity

1

: 812,000 tons

Clearwater Paper Pulp

Clearwater Paper SBS

Source: Company estimates, RISI, AF&PA

Represents 2014 annual volumes.

Represents ~6.0 million tons.

2014 North American Bleached

Paperboard Production by Type²

2014

36

%

Packaging

23

%

17

%

13

%

Bristols

8

%

3

%

2014 North American Bleached

Paperboard Production by Market Share

2014

International Paper

24

%

MeadWestvaco

23

%

Georgia Pacific

13

%

Evergreen

13

%

Clearwater Paper

12

%

Rock-Tenn

7

%

Weyerhauser

5

%

Tembec Paperboard

3

%

13

1

2

14

GROW OUR TISSUE BUSINESS

> Lead private label in quality

> Expand geographically

> Diversify retail channel penetration

OPTIMIZE PROFITABILITY OF

PAPERBOARD AND TISSUE BUSINESSES

> Improve sales mix

> Reduce costs

> Continue to improve quality

OUR MACRO STRATEGY TO

CREATE SHAREHOLDER VALUE

SUCCESSFUL EXECUTION OF

PREVIOUSLY STATED GOALS

GOAL

COMPLETE NEW PAPER MACHINE

AT SHELBY, NC FACILITY

GOAL

OPTIMIZE THE

PAPERBOARD BUSINESS

GOAL

MAINTAIN A PRUDENT CAPITAL

STRUCTURE TO LOWER WEIGHTED

AVERAGE COST OF CAPITAL

GOAL

ASSET RATIONALIZATION/

COST INFRASTRUCTURE

GOAL

RETURN OF CAPITAL TO

SHAREHOLDERS

Sold 5 specialty mills in December 2014 for $114 million

Closure of Long Island and Thomaston converting operations in 2013-2014

Established

cross divisional supply chain function to drive out costs system wide

Record 2014

production of 792K tons and Adjusted EBITDA margin of 22%

Cost and production improvement projects

Idaho major maintenance cycle increased from 12 to 18 months

Enhanced access to fiber supply with chipping facility acquisition near Lewiston, Idaho

70k ton Shelby TAD machine startup in Q4 2012 on budget

Full run rate achieved in Q3 2014 versus goal of Q4 2013

Conservative capital structure with target leverage through the cycle of 3x Adjusted

EBITDA and ample liquidity

Refinanced bonds and reduced long-term debt interest rate to 5% from 8.6%

since 2013

Announced new $100 million share repurchase program in December 2014

Returned $230 million in capital to shareholders from 2011-2014 through share

repurchases

Reduced shares outstanding by  20% or 4.5 million shares through 2014

Achieved $72 million Adjusted EBITDA in Q3 2014

Input cost inflation

and conventional tissue pricing headwinds persist

Sold specialty

mills in December 2014 representing 8% or $18.4 million in Adjusted

EBITDA

1

See Appendix for the definition of Adjusted EBITDA as well as the reconciliation to the most comparable GAAP measure.

2

Pulp

and

Paperboard

operating

income

for

2014

of

$144.2

million

plus

depreciations

of

$25.5

million

and

loss

on

impairment

of

Clearwater

Fiber

intangible

asset

resulting

in

Adjusted

EBITDA

of

$172.7

million

15

GOAL

$300

MILLION ADJUSTED EBITDA

1

1

2

$300

$28

$22

$46

$18

$230

$100

$150

$200

$250

$300

$350

Original Target

at 2011

Price / Cost

Conventional Tissue

Pricing

Paperboard Pricing

Fiber, Transportation,

Chemicals, Gas

Sale of Specialty Mills

Reset Target at 2014

Price / Cost

ADJ. EBITDA

1,2

(MILLIONS)

13.4%

16.4%

UPDATED ADJUSTED EBITDA TARGET

IN LIGHT OF CHANGES IN MARKET

CONDITIONS AND DIVESTITURE

16

1

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

.                                                                                                                              

2

This information is based upon management’s expectations and estimates as of April 22, 2015, which are in part based on market and industry data. Many factors are outside the control of management, including particularly input costs for

commodity products, and actual results may differ materially from the information set forth above. See “Forward-Looking Statements” on page 2.

PRICING AND INPUT COSTS VS. 2011

•

Pricing pressure for conventional tissue products

•

Competitive market environment a barrier to passing through input cost inflation to customers

•

Key input costs up $46 million

•

Partly offset by improved paperboard pricing

•

$18.4

million

of

Adjusted

EBITDA

1

divested

with

sale

of

specialty

products

mills

2

CLEARWATER PAPER

CROSS CYCLE FINANCIAL MODEL

NET SALES

1

ADJUSTED GROSS PROFIT % OF NET SALES

2

ADJUSTED SG&A % OF NET SALES

2

ADJUSTED OPERATING PROFIT % OF NET SALES

2

ADJUSTED NET EARNINGS % OF NET SALES

2

ADJUSTED EBITDA % OF NET SALES

2

100%

17.0%

(6.0%)

11.0%

5.0%

15.0%

1 

Net sales for the year ended December 31, 2014 were $1,967.1 million and include results of the specialty tissue business which was sold at the end of Q4’14.  Net sales for the second quarter ended June 30, 2015 were $444.6 million.  

2 

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure.

17

Q2’15

RESULTS

100%

13.7%

(7.0%)

6.8%

3.2%

11.4%

2014

RESULTS

100%

13.9%

(6.3%)

7.5%

3.5%

12.1%

•

Pulp optimization at mills

•

Standardize the back end of our converting lines

•

Bring new swing-line in Las Vegas on-line

•

Execute national warehousing and logistics optimization strategy

•

100% adoption of pallet-based warehouse platform

•

Standardize

our national 3

rd

party logistics strategy

•

Grow cup market stock and folding carton market share

•

Simplify cup and brik manufacturing complexity

•

Reduce complexity in our business through grade & SKU validation

•

Improve our category insights to help retailers sell best mix of products

•

Implement

Black/Green belt training projects through Total Productive

Maintenance (TPM)

•

Conduct loss analysis audits by mill

•

Develop

Supply Chain planning tools (Demantra) for efficiencies

•

Launch Phase 2 of JD Edwards (Project 1Way), TM1 (financial forecasting)

PATH TO 15% ADJUSTED EBITDA

CROSS CYCLE TARGET MARGIN

18

GOAL

INCREASE OUR SALES

EFFECTIVENESS

GOAL

ACHIEVE SUPPLY CHAIN

EFFICIENCIES

GOAL

STRENGTHEN

OUR

CONTINUOUS

IMPROVEMENT CULTURE

GOAL

IMPROVE OUR MANUFACTURING

COST STRUCTURE

GOAL

IMPLEMENT

THE RIGHT

PROCESSES, TOOLS, SYSTEMS

•

Reallocate $107M net specialty proceeds to strategic

investments

•

Operational improvements

STRATEGIC INVESTMENTS

EXPECTED TO ACHIEVE

ADJUSTED EBITDA MARGIN TARGET

19

(MILLIONS

$)

2015

2016-2018

FULL

RUN-RATE EXPECTED

1

STRATEGIC INVESTMENTS

2

CAPEX

CAPEX

ADJUSTED EBITDA IMPACT

Pulp Optimization

$26

$120-$130

$30-$35

Warehouse Automation

$12

$25-$30

$27-$32

Paper Machine and Converting Line Upgrades

$27

$11-$12

Converting Lines

$14

$10-$12

IT

$6

TOTAL STRATEGIC CAPEX

$85

$145-$160

PLUS BENEFITS FROM:

Operational Efficiency

$20-$32

Sales & Marketing Efficiency

$10-$15

Stranded Overhead

$7

TOTAL

$115-$145

Invest to improve operating efficiency and profitability

1

Non-GAAP measure –

See definition and reconciliation to most comparable GAAP measure

2

Based on Q1’15 prices, input costs, and market and industry data. Many factors are outside the control of management, including particularly input costs for commodity products, and actual results may differ materially from the information set forth

above. See “Forward-Looking Statements” on page 2.

3

Improvements start to contribute in 2016 through 2018 after the first year of investment in 2015.

•

High return/low risk investments

•

Expected to permanently reduce cost structure

•

Expected Adjusted EBITDA improvement of $115 to $145 million in 2-3 years

1, 3

•

Funding in Year 1 from sale proceeds of specialty mills

EXPECTED ADJUSTED EBITDA

FROM STRATEGIC INVESTMENTS AND

OPERATIONAL IMPROVEMENTS

1, 2

20

•

Expected to yield a $115-$145 million Adjusted EBITDA increase over the $230M reset run rate

•

In addition, assume an annual $10-15 million of margin pressure

•

Implies $285-$335 million Adjusted EBITDA run rate in 2018

1

Based

on

Q1’15

prices,

input

costs,

and

market

and

industry

data.

Many

factors

are

outside

the

control

of

management,

including

particularly

input

costs

for

commodity

products,

and

actual

results

may

differ

materially

from

the

information

set

forth

above. See “Forward-Looking Statements” on page 2.

2

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure.                                          

$-

$20

$40

$60

$80

$100

$120

$140

$160

2015

2016

2017

2018

Expected Adjusted

EBITDA Benefit From

Investment and

Operational

Improvements1

ADJ. EBITDA

1,2

(MILLIONS)

$5-$10

$40-$50

$40-$60

$30-$60

$115-$145

1

1

CLEARWATER PAPER’S

VALUE PROPOSITION

21

BALANCED CAPITAL ALLOCATION

2011-2014

22

•

20% of total shares outstanding from

2011 through 2014

•

Continued investment in the business

while returning capital to investors

Capital Allocation

2011-2014

Cumulative Shares Repurchased

Total Shares Outstanding

(As of Dec 31st)

Commitment

to

return

at

least

50%

of

Discretionary

Free

Cash

Flow

1

to

shareholders

through

2015

1

Discretionary Free Cash Flow is cash flow from operations less maintenance capital expenditures

2011 –

2014

Capex

34

%

TAD Expansion

35

%

Stock Repurchase

31

%

CLEARWATER

PAPER

PAPERBOARD

2

LARGE-CAP

CONSUMER

3

S&P 500

CLEARWATER PAPER IS A

LEADER AMONGST ITS PEERS

IN VALUE CREATION

Source: Bloomberg. Market data as of August 25, 2015

Note: Total Shareholder Return includes with dividends reinvested and stock price performance.

1

Small cap tissue peers include Cascades, Orchids and Wausau.

23

400%+ Total Shareholder Return Since Spin-off

² Paperboard peers include International Paper, Graphic Packaging, Kapstone, MeadWestvaco, Packaging Corp of America, RockTenn,

Sonoco and WestRock. MeadWestvaco is excluded following merger announcement on January 26, 2015, and WestRock included in

place

of

RockTenn

beginning

June

24,

2015.

³

Large

cap

consumer

product

peers

include

Kimberly-Clark

and

Procter

&

Gamble.

INDEXED TOTAL RETURNS

SPIN

DATE

(100)%

0%

100%

200%

300%

400%

500%

600%

700%

800%

900%

Dec-2008

Apr-2010

Aug-2011

Dec-2012

Apr-2014

Aug-2015

Clearwater Paper

Small Cap Tissue¹

Paperboard²

Large Cap Consumer³

S&P 500

406.2%

633.0%

158.3%

148.4%

104.1%

1

SMALL-CAP

TISSUE

Strong Upward Trend in Multiple Over Time

WHICH HAS LED TO MULTIPLE

EXPANSION SINCE THE SPIN

24

CLEARWATER

PAPER

SMALL-CAP

TISSUE

1

PAPERBOARD

2

LARGE-CAP

CONSUMER

3

SPIN

DATE

2-YEAR FORWARD EBITDA MULTIPLE

Source: Bloomberg and Capital IQ. Market data as of Aug 25 , 2015

1

Small cap tissue peers include Cascades, Orchids and Wausau.

² Paperboard peers include International Paper, Graphic Packaging, Kapstone, MeadWestvaco, Packaging Corp of America, RockTenn,

Sonoco and WestRock. MeadWestvaco is excluded following merger announcement on January 26, 2015, and WestRock included in

place

of

RockTenn

beginning

June

24,

2015.

³

Large

cap

consumer

product

peers

include

Kimberly-Clark

and

Procter

&

Gamble.

2x

4x

6x

8x

10x

12x

14x

Dec-2008

Apr-2010

Aug-2011

Dec-2012

Apr-2014

Aug-2015

Clearwater Paper

Small Cap Tissue¹

Paperboard²

Large Cap Consumer Products³

10.9x

6.9x

6.5x

6.0x

RETURN ON INVESTED CAPITAL

1,6

(UNAUDITED)

25

1

Return

on

Invested

Capital

(ROIC)

is

defined

as

[Net

Earnings

+

Interest

Expense]

/

[Tangible

Stockholders’

Equity

6

+

Debt

–

Excess

(Deficit)

Cash

6

].

2

Weighted Average Cost of Capital (WACC) is defined as [(Debt x Cost of Debt x {1-Marginal Tax Rate})/(Debt + Stockholders’ Equity)]+ [(Stockholders’ Equity x Cost of Equity)/(Debt + Stockholders’ Equity)].

3

2013

Adjusted

ROIC

Net

Earnings

was

adjusted

to

remove

a

benefit

of

$67.5

million

from

discrete

tax

items

relating

to

release

of

uncertain

tax

positions.

2013 Adjusted ROIC

Interest Expense includes debt retirement costs of $17.1 million.

4

2014 Adjusted ROIC Net Earnings was adjusted to remove costs/loss associated with optimization and sale of the specialty mills totaling $37.0 million after-tax.

2014 Adjusted ROIC Interest Expense includes debt retirement costs of $24.4 million.

5

LTM Ending 6/30/15 Adjusted ROIC Net Earnings was adjusted to remove costs/loss associated with optimization and sale of the specialty mills totaling $36.0 million after-tax.

LTM Ending 6/30/15 Adjusted ROIC Interest Expense includes debt retirement costs of $24.4 million.

6

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

below.

12.4%

12.7%

16.7%

4.7%

4.3%

11.1%

12.7%

12.2%

8.3%

7.7%

6.5%

4.5%

3.7%

0%

5%

10%

15%

20%

2011

2012

2013

2014

LTM Ending

6/30/15

5

ROIC

Adjusted ROIC

WACC

2

3,4,5

1

4

3

CLEARWATER PAPER’S

OUTLOOK

26

CONSUMER

PRODUCTS

PULP AND PAPERBOARD

CORPORATE

SHIPMENT VOLUMES

•

Higher

:

2–4% higher

•

Lower

:

3-4% lower

PRICE/MIX

•

Slightly higher:

0–2% higher

•

Slightly lower  :

0-1% lower

PULP/WOOD FIBER COSTS

•

Cost/shipped ton:

stable

•

Cost/shipped ton:

stable

CHEMICAL COSTS

•

Cost/shipped ton:

stable

•

Cost/shipped ton:

lower

OP. & PKG. SUPPLIES

•

Cost/shipped ton:

stable

•

Cost/shipped ton:

stable

TRANSPORTATION COSTS

•

Cost/shipped ton:

higher

•

Cost/shipped ton:

stable

ENERGY COSTS

•

Cost/shipped ton:

stable

•

Cost/shipped ton:

lower

MAINTENANCE & REPAIRS

•

Stable

•

Lower due to completion             

of Arkansas major      

maintenance outage ($7M)

SG&A

•

Stable

•

Stable

•

Stable

UPDATED THIRD QUARTER 2015

OUTLOOK

(COMPARED

TO

Q2’15)

1

27

Outlook: consolidated net sales flat; adjusted operating margin 9.0-10.0%

2

1

This information is based upon management’s current expectations and estimates, which are in part based on market and industry data.  Many factors are outside the control of management,

including particularly input costs for commodity products, and actual results may differ materially from the information set forth above.  See “Forward-Looking Statements” on page 2.

2

Updated from Q2 2015 Supplemental Information provided on July 30, 2015.

2

2

2

28

1

This information is based upon management’s current expectations and estimates, which are in part based on market and industry data. Many factors are outside the control of management, including

particularly input costs for commodity products, and actual results may differ materially from the information set forth above. See “Forward-Looking Statements” on page 2.

2

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

below.

UPDATED BRIDGE TO Q3’15

ADJUSTED EBITDA OUTLOOK

1,2

$51

$1-$2

$3-$4

$2-$3

$2-$3

$7

$1

$1

$62-$66

$1

$15

$25

$35

$45

$55

$65

$75

Q2'15

Adj. EBITDA

PPD

Price/Volume

CPD

Price/Volume

Chemicals

Energy

Maintenance

Labor

Transportation

AR Electrical

Disruptions

Q3'15

Adj. EBITDA

Outlook

ADJ.

EBITDA

2

(MILLIONS)

1,2

2

APPENDIX

29

RECONCILIATION OF GAAP TO NON-GAAP:

CLEARWATER

PAPER

EBITDA

1

AND

ADJUSTED

EBITDA

1

30

¹ See Appendix for the definition of Adjusted EBITDA as well as the reconciliation to the most comparable GAAP measure.

2

Interest expense, net for 2009, 2013, and 2014 includes debt retirement costs of $6.2, $17.1 and $24.4 million respectively.

($ in millions)

2008

2009

2010

2011

2012

2013

2014

Q1’15

Q2’15

earnings/(loss)

$

9.7

$

182.5

$

73.8

$

39.7

$

64.1

$

107.0

$

(2.3)

$

5.8

$

15.6

$

5.6

$

93.2

$

2.4

$

31.2

$

47.5

$

(68.7)

$

(18.6)

$

1.7

$

8.7

2

$

13.1

$

21.7

$

22.6

$

44.8

$

33.8

$

61.1

$

63.6

$

7.8

$

7.8

$

47.0

$

47.4

$

47.7

$

76.9

$

79.3

$

90.3

$

90.1

$

21.0

$

20.6

1

$

75.4

$

344.8

$

146.5

$

192.7

$

224.7

$

189.6

$

170.0

$

36.2

$

52.7

-

$

(170.6)

-

-

-

-

-

-

-

-

-

$

20.3

-

-

-

-

-

-

-

-

-

$

2.9

-

-

-

-

-

-

-

-

-

$

1.0

-

-

-

-

-

-

-

-

$

2.0

-

-

-

-

-

-

-

-

-

$

6.0

$

1.3

-

-

-

-

-

-

-

-

$

18.8

$

.6

$

.7

equity-based compensation expense (benefit)

-

$

2.6

$

3.7

$

1.5

$

1.4

$

4.1

$

4.6

$

(.5)

$

(1.5)

-

-

-

-

-

-

-

$

1.7

-

associated with optimization and sale of the specialty mills

-

-

-

-

-

-

$

40.8

$

(.1)

$

(1.3)

of Clearwater Fiber intangible asset

-

-

-

-

-

-

3.1

-

-

EBITDA

1

$

75.4

$

176.8

$

170.5

$

197.1

$

229.1

$

199.7

$

238.5

$

37.9

$

50.7

$

EBITDA & ADJUSTED EBITDA

RECONCILIATION OF NON-GAAP

FINANCIAL MEASURES  (UNAUDITED)

31

1

EBITDA is a non-GAAP measure that management uses as a supplemental performance measure.  The most directly comparable GAAP measure is net earnings (loss).  EBITDA is net earnings (loss) adjusted for

net interest expense (including debt retirement costs), income taxes, and depreciation and amortization.  It should not be considered as an alternative to net earnings (loss) computed under GAAP.

2

Interest expense, net for the third quarter of 2014 includes debt retirement costs of $24.4 million.

3

Adjusted EBITDA excludes the impact of the items listed that we do not believe are indicative of our core operating performance.

(Dollars in thousands)

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2'15

Earnings before interest, income taxes, and depreciation & amortization

(EBITDA)

1

GAAP net earnings (loss)

$  6,226

$  12,453

$  6,253

($27,247)

$  5,757

$  15,597

Interest expense, net

2

10,734

10,688

33,990

8,158

7,782

7,774

Income tax provision

3,558

9,942

3,735

1,321

1,698

8,702

Depreciation and amortization expense

22,231

22,015

22,293

23,606

21,008

20,632

EBITDA

1

$  42,749

$  55,098

$  66,271

$  5,838

$  36,245

$  52,705

Directors' equity-based compensation expense (benefit)

2,817

(36)

(185)

2,010

(470)

(1,457)

Costs associated with Thomaston facility closure

750

374

42

91

-

-

Costs associated with Long Island facility closure

8,432

1,843

4,767

3,771

554

735

Costs/loss associated with optimization and sale of the specialty mills

-

-

1,066

39,735

(131)

(1,331)

Loss on impairment of Clearwater Fiber intangible asset

-

-

-

3,078

-

-

Costs associated with labor agreement

-

-

-

-

1,730

-

Adjusted EBITDA

3

$  54,748

$  57,279

$  71,961

$  54,523

$  37,928

$  50,652

SEGMENT EBITDA & ADJUSTED EBITDA

RECONCILIATION OF NON-GAAP

FINANCIAL MEASURES  (UNAUDITED)

32

1

Segment EBITDA is a non-GAAP measure that management uses as a supplemental performance measure.  The most directly comparable GAAP measure is segment operating income (loss).  Segment EBITDA is

segment operating income (loss) adjusted for depreciation and amortization.  It should not be considered as an alternative to segment operating income (loss) computed under GAAP.

2

Segment Adjusted EBITDA excludes the impact of the items listed that we do not believe are indicative of our core operating performance.

(Dollars in thousands)

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2'15

Consumer Products

Operating (loss) income

($523)

$  12,705

$  12,535

(30,745)

$     

$  12,395

$  17,032

Depreciation and amortization expense

15,490

15,071

15,484

15,459

12,977

13,438

Segment EBITDA

1

$  14,967

$  27,776

$  28,019

($15,286)

$  25,372

$  30,470

Costs associated with Thomaston facility closure

750

374

42

91

-

-

Costs associated with Long Island facility closure

8,432

1,843

4,767

3,771

554

735

Costs/loss associated with optimization and sale of the specialty mills

-

-

579

40,222

(131)

(1,331)

Costs associated with labor agreement

-

-

-

-

814

-

Segment Adjusted EBITDA

2

$  24,149

$  29,993

$  33,407

$  28,798

$  26,609

$  29,874

Pulp and Paperboard

Operating income

$  36,776

$  33,635

$  45,602

$  28,158

$  16,194

$  27,754

Depreciation and amortization expense

6,270

6,019

5,939

7,224

7,311

6,737

Segment EBITDA

1

$  43,046

$  39,654

$  51,541

$  35,382

$  23,505

$  34,491

Loss on impairment of Clearwater Fiber intangible asset

-

-

-

3,078

-

-

Costs associated with labor agreement

-

-

-

-

916

-

Segment Adjusted EBITDA

2

$  43,046

$  39,654

$  51,541

$  38,460

$  24,421

$  34,491

Corporate

Operating loss

($15,735)

($13,257)

($14,159)

($15,181)

($13,352)

($12,713)

Depreciation and amortization expense

471

925

870

923

720

457

Corporate EBITDA

1

($15,264)

($12,332)

($13,289)

($14,258)

($12,632)

($12,256)

Directors' equity-based compensation expense (benefit)

2,817

(36)

(185)

2,010

(470)

(1,457)

Costs/loss associated with optimization and sale of the specialty mills

-

-

487

(487)

-

-

Corporate Adjusted EBITDA

2

($12,447)

($12,368)

($12,987)

($12,735)

($13,102)

($13,713)

ADJUSTED GROSS PROFIT

& ADJUSTED SG&A

RECONCILIATION OF NON-GAAP

FINANCIAL MEASURES  (UNAUDITED)

33

1

Gross profit is defined as net sales minus cost of sales.

2

Adjusted gross profit and Adjusted selling, general and administrative expenses exclude the impact of the items listed that we do not believe are indicative of our core operating performance.

(Dollars in thousands)

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2'15

Gross profit

1

$  58,291

$  64,648

$  76,685

$  58,675

$  44,194

$  60,211

Costs associated with Thomaston facility closure

750

374

42

91

-

-

Costs associated with Long Island facility closure

3,941

1,843

3,877

3,771

554

735

Costs associated with labor agreement

-

-

-

-

1,730

-

Adjusted gross profit

2

$  62,982

$  66,865

$  80,604

$  62,537

$  46,478

$  60,946

Selling, general and administrative expenses (SG&A)

($33,514)

($31,565)

($31,817)

($33,206)

($28,957)

($28,138)

Costs associated with Long Island facility closure

232

-

-

-

-

-

Directors' equity-based compensation expense (benefit)

2,817

(36)

(185)

2,010

(470)

(1,457)

Costs/loss associated with optimization and sale of the specialty mills

-

-

1,066

(424)

(131)

(1,331)

Adjusted

selling,

general

and

administrative

expenses

2

($30,465)

($31,601)

($30,936)

($31,620)

($29,558)

($30,926)

SEGMENT ADJUSTED OPERATING

INCOME (LOSS)

RECONCILIATION OF NON-GAAP

FINANCIAL MEASURES  (UNAUDITED)

34

1

Adjusted operating income (loss) excludes the impact of the items listed that we do not believe are indicative of our core operating performance.

(Dollars in thousands)

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2'15

Consumer Products

Operating (loss) income

($523)

$  12,705

$  12,535

($30,745)

$  12,395

$  17,032

Costs associated with Thomaston facility closure

750

374

42

91

-

-

Costs associated with Long Island facility closure

8,432

1,843

4,767

3,771

554

735

Costs/loss associated with optimization and sale of the specialty mills

-

-

579

40,222

(131)

(1,331)

Costs associated with labor agreement

-

-

-

-

814

-

Adjusted

Consumer

Products

operating

income

1

$  8,659

$  14,922

$  17,923

$  13,339

$  13,632

$  16,436

Pulp and Paperboard

Operating Income

$  36,776

$  33,635

$  45,602

$  28,158

$  16,194

$  27,754

Loss on impairment of Clearwater Fiber intangible asset

-

-

-

3,078

-

-

Costs associated with labor agreement

-

-

-

-

916

-

Adjusted

Pulp

and

Paperboard

operating

income

1

$  36,776

$  33,635

$  45,602

$  31,236

$  17,110

$  27,754

Corporate

Operating loss

($15,735)

($13,257)

($14,159)

($15,181)

($13,352)

($12,713)

Directors' equity-based compensation expense (benefit)

2,817

(36)

(185)

2,010

(470)

(1,457)

Costs/loss associated with optimization and sale of the specialty mills

-

-

487

(487)

-

-

Adjusted

Corporate

operating

loss

1

($12,918)

($13,293)

($13,857)

($13,658)

($13,822)

($14,170)

ADJUSTED NET EARNINGS & ADJUSTED NET

EARNINGS PER DILUTED COMMON SHARE

RECONCILIATION OF NON-GAAP FINANCIAL

MEASURES  (UNAUDITED)

35

1

All non-tax items are tax effected at the expected annual rate for that period.

2

Adjusted net earnings and Adjusted net earnings per diluted common share exclude the impact of the items listed that we do not believe are indicative of our core operating performance.

(Dollars in thousands -

except per-share amounts)

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2'15

GAAP net earnings (loss)

$  6,226

$  12,453

$  6,253

($27,247)

$  5,757

$  15,597

Special items, after tax:

1

Debt retirement costs

-

-

15,777

-

-

-

Directors' equity-based compensation expense (benefit)

1,802

(23)

(120)

1,322

(325)

(998)

Costs associated with Thomaston facility closure

480

242

27

60

-

-

Costs associated with Long Island facility closure

5,394

1,193

3,069

2,480

383

504

Costs/loss associated with optimization and sale of the specialty mills

-

-

689

36,338

(91)

(912)

Discrete tax item related to state tax rate changes

-

1,388

-

-

-

-

Loss on impairment of Clearwater Fiber intangible asset

-

-

-

2,024

-

-

Costs associated with labor agreement

-

-

-

-

1,197

-

Adjusted net earnings

2

$  13,902

$  15,253

$  25,695

$  14,977

$  6,921

$  14,191

Net earnings (loss) per diluted common share

$  0.29

$  0.61

$  0.31

($1.39)

$  0.30

$  0.81

Special items, after tax:

1

Debt retirement costs

-

-

0.78

-

-

-

Directors' equity-based compensation expense (benefit)

0.08

-

(0.01)

0.07

(0.02)

(0.05)

Costs associated with Thomaston facility closure

0.02

0.01

-

-

-

-

Costs associated with Long Island facility closure

0.25

0.06

0.15

0.13

0.02

0.03

Costs/loss associated with optimization and sale of the specialty mills

-

-

0.03

1.86

-

(0.05)

Discrete tax item related to state tax rate changes

-

0.07

-

-

-

-

Loss on impairment of Clearwater Fiber intangible asset

-

-

-

0.10

-

-

Costs associated with labor agreement

-

-

-

-

0.06

-

Adjusted

net

earnings

per

diluted

common

share

2

$  0.66

$  0.74

$  1.28

$  0.77

$  0.36

$  0.74

KEY SEGMENT RESULTS –

PULP AND PAPERBOARD

(UNAUDITED)

36

1

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

below.

2

Segment Adjusted EBITDA margin is defined as Segment Adjusted EBITDA divided by Segment net sales.

PULP AND

PAPERBOARD

CROSS-CYCLE

FINANCIAL MODEL

Q1'14

Q2'14

Q3'14

Q4'14

Q1’15

Q2’15

(short tons)

200,665

195,924

201,609

176,467

191,635

204,983

$988

$1,017

$1,016

$1,017

$1,031

$997

in thousands)

$198,412

$199,629

$205,038

$180,675

$198,850

$205,167

1

($

in thousands)

$43,046

$39,654

$51,541

$38,460

$24,421

$34,491

1,2

21.7%

19.9%

25.1%

21.3%

12.3%

16.8%

19.0%

KEY SEGMENT RESULTS –

CONSUMER PRODUCTS

(UNAUDITED)

37

1

Includes

away-from-home

(AFH),

contract,

machine-glazed

(MG)

and

parent

roll

tissue

products.

2

Includes

retail,

AFH,

and

contract

tissue

case

products.

3

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

below.

4

Segment

Adjusted

EBITDA

margin

is

defined

as

Segment

Adjusted

EBITDA

divided

by

Segment

net

sales.

5

Results include specialty tissue business which was sold at the end of Q4’14.

CONSUMER

PRODUCTS

CROSS-CYCLE

FINANCIAL MODEL

RESULTS

INCLUDE SPECIALTY

MILLS

5

RESULTS

WITHOUT

SPECIALTY

MILLS

Q1'14

Q2'14

Q3'14

Q4'14

Q1'15

Q2’15

Shipments

Non-Retail

(short tons)

1

56,839

59,832

59,703

57,765

21,107

24,744

Retail (short tons)

70,919

75,009

75,363

72,420

71,102

71,476

Total Tissue Tons

127,758

134,841

135,066

130,185

92,209

96,220

Converted

Products

(cases

in

thousands)

2

13,437

14,101

14,360

13,603

13,025

13,125

Sales Price

Non-Retail ($/short ton)

1

$1,489

$1,492

$1,531

$1,506

$1,475

$1,430

Retail ($/short ton)

$2,841

$2,795

$2,836

$2,820

$2,864

$2,846

Total Tissue ($/short ton)

$2,239

$2,217

$2,259

$2,237

$2,546

$2,482

Segment

net

sales

($

in

thousands)

$286,508

$299,130

$306,104

$291,643

$235,176

$239,391

Segment

Adjusted

EBITDA

3

($

in thousands)

$24,149

$29,993

$33,407

$28,798

$26,609

$29,874

Segment

Adjusted

EBITDA

margin

3,4

8.4%

10.0%

10.9%

9.9%

11.3%

12.5%

17.0%

RETURN ON INVESTED CAPITAL, TANGIBLE

STOCKHOLDERS’ EQUITY & EXCESS CASH

RECONCILIATION OF NON-GAAP FINANCIAL

MEASURES  (UNAUDITED)

38

(Dollars in thousands)

2011

2012

2013

2014

Twelve Months

Ending June 30,

2015

Net earnings (loss)

39,674

$     

64,131

$     

106,955

$   

($2,315)

360

$           

Interest expense, net

44,809

33,796

44,036

39,150

33,284

Net

earnings

before

interest

1

84,483

$     

97,927

$     

150,991

$   

36,835

$      

33,644

$      

Tangible

stockholders'

equity

2

205,623

$   

263,608

$   

334,783

$   

263,494

$    

255,741

$    

Debt

523,694

523,933

650,000

575,000

575,000

Less

excess

cash

3

(48,440)

(17,579)

(78,675)

(62,331)

(56,465)

Invested capital

680,877

$   

769,962

$   

906,108

$   

776,163

$    

774,276

$    

Return on Invested Capital (ROIC)

12.4%

12.7%

16.7%

4.7%

4.3%

Stockholders' equity

484,904

$   

540,894

$   

605,094

$   

497,537

$    

487,301

$    

Goodwill

(229,533)

(229,533)

(229,533)

(209,087)

(209,087)

Intangible assets, net

(49,748)

(47,753)

(40,778)

(24,956)

(22,473)

Tangible

stockholders'

equity

2

205,623

$   

263,608

$   

334,783

$   

263,494

$    

255,741

$    

Cash

8,439

$       

12,579

$     

23,675

$     

27,331

$      

11,465

$      

Short-term investments

55,001

20,000

70,000

50,000

60,000

Operating cash

4

(15,000)

(15,000)

(15,000)

(15,000)

(15,000)

Excess cash

3

48,440

$     

17,579

$     

78,675

$     

62,331

$      

56,465

$      

1

Note:  Balance sheet items are as of the end of each period presented.

2

3

4

Non-GAAP measure.

Tangible stockholders' equity is defined as stockholders’ equity less Goodwill and Intangible assets, net.

Operating cash is defined as a minimum amount of available cash deemed by management to be sufficient to avoid operating disruptions due to a mismatch of cash inflows and outflows during an accounting period.

Excess

cash

is

defined

as

the

sum

of

Cash

and

Short-term

investments

less

Operating

cash

1

.

PRO FORMA IMPACT OF

SALE OF SPECIALTY MILLS

(UNAUDITED)

39

1

Non-GAAP

measure

–

See

definition

and

reconciliation

to

most

comparable

GAAP

measure

CONSUMER PRODUCTS

INCLUDING SPECIALTY

MILLS

SPECIALTY MILLS

PRO FORMA

CONSUMER

PRODUCTS

EXCLUDING

SPECIALTY MILLS

(Dollars in millions)

TWELVE MONTHS ENDED

DECEMBER 31, 2014

TWELVE MONTHS ENDED

NOVEMBER 30, 2014

PRO FORMA

Net sales

$1,183.4

$217.7

$965.7

Adjusted

operating

income

1

$54.8

$8.8

$46.0

Depreciation and amortization expense

$61.5

$9.6

$51.9

Adjusted

EBITDA

1

$116.3

$18.4

$97.9

40

1

This information is based upon management’s current expectations and estimates, which are in part based on market and industry data.  Many factors are outside the control of management,

including particularly input costs for commodity products, and actual results may differ materially from the information set forth above.  See “Forward-Looking Statements” on page 2.

2

EBITDA is a non-GAAP measure that management uses as a supplemental performance measure.  The most directly comparable GAAP measure is net earnings (loss).  EBITDA is net earnings adjusted for net

interest expense (including debt retirement costs), income taxes, and depreciation and amortization.  It should not be considered as an alternative to net earnings computed under GAAP.

3

Adjusted EBITDA excludes the impact of the items listed that we do not believe are indicative of our core operating performance.

Q3’15 OUTLOOK

1

RECONCILIATION OF NON-GAAP

FINANCIAL MEASURES  (UNAUDITED)

(Dollars in thousands)

FROM

TO

Earnings before interest, income taxes, and depreciation &

amortization (EBITDA)

2

GAAP net earnings

$21,000

$23,000

Interest expense, net

$8,000

$8,000

Income tax provision

$11,000

$13,000

Depreciation and amortization expense

$21,000

$21,000

EBITDA

2

$61,000

$65,000

Directors' equity-based compensation expense

$700

$700

Costs associated with Long Island facility closure

$300

Adjusted EBITDA

3

$62,000

$66,000

THREE MONTHS ENDING

SEPTEMBER 30, 2015

RANGE OF ESTIMATE

OUTLOOK

$300

RECONCILIATION OF GAAP TO NON-GAAP:

STRATEGIC INVESTMENTS

41

¹ See Appendix for the definition of Adjusted EBITDA as well as the reconciliation to the most comparable GAAP measure.

PULP

OPTIMIZATION

WAREHOUSE

AUTOMATION

PAPER MACHINE

UPGRADES

CONVERTING

LINE

OPERATING

EFFICIENCIES

SALES & MARKETING

EFFICIENCY

STRANDED

OVERHEAD

Operating Income

$22.5-27.5

$21.3-26.3

$7.1-8.1

$8.6-10.6

$20 - $32

$10 - $15

$7

Depreciation

$7.5

$5.7

$3.9

$1.4

-

-

-

EBITDA

$30 - $35

$27 - $32

$11 - $12

$10 - $12

$20 - $32

$10 - $15

$7

Adjusted EBITDA

$30 - $35

$27 - $32

$11 - $12

$10 - $12

$20 - $32

$10 - $15

$7

DEFINITIONS OF NON-GAAP

MEASURES

CLEARWATER PAPER DEFINITIONS OF NON-GAAP MEASURES

EBITDA is a non-GAAP measure that Clearwater Paper management uses as a

supplemental performance measure to evaluate the cash generating capacity of Clearwater

Paper. The most directly comparable GAAP measure is net earnings.  EBITDA, as defined

by Clearwater Paper management, is net earnings adjusted for net interest expense,

income taxes, and depreciation and amortization. It should not be considered as an

alternative to net earnings computed under GAAP.

Adjusted EBITDA is a non-GAAP measure that Clearwater Paper management defines as

EBITDA adjusted for items that we do not believe are indicative of our core operating

performance, including acquisition and disposition related expenses, alternative fuel mixture

tax credits, sale of foam assets, expenses associated with the Metso litigation and costs

associated with directors equity based compensation.  The most directly comparable GAAP

measure is net earnings.  It should not be considered as an alternative to net earnings

computed under GAAP.

42

MAJOR MAINTENANCE

SCHEDULE¹

2014

2015

2016

2017

2018

2019

2020

2021

Major Maintenance

$MMs

$0

$22

TBD

TBD

TBD

TBD

$0

TBD

Lewiston

Q1

Q3

Q1

Q3

Q1

Cypress Bend

Q2

Q2

Q2

Q2

43

1

This information is based upon management’s current expectations and estimates.

NORTH AMERICAN TISSUE

PROJECTED CAPACITY CHANGE

44

Source:  RISI and Other Industry

COMPANY

MILL/LOCATION

CONV/TAD

CAPACITY

CHANGE

ESTIMATED DATE

CHANNEL/BUSINESS/PRODUCTS

Announced New Capacity through 2016

Double Tree/Royal

Gila Bend, AZ

Conv

32,000

2015:Q1

PrimeLine PM from Adritz

Orchids Paper Products

Pryor, OK

Conv

30,000

2015:Q1

New PM from Recard

Confidential

Confidential

Conv

80,000

2015:Q4

Metso Advantage DCT 200TS

First Quality Tissue

Anderson, SC

TAD

70,000

2015:Q4

TAD PM Valmet

Von Drehle Corporation

Natchez, MS

Conv

35,000

2015:Q4

Valmet Advantage NTT

St. Croix Tissue (APP)

Baileyville, ME

Conv

66,000

2015:Q4

PrimeLine W8 PM from Adritz

First Quality Tissue

Anderson, SC

ATMOS

75,000

2016:Q1

Retail/P.L./BRT

St. Croix Tissue (APP)

Baileyville, ME

Conv

66,000

2016:Q2

PrimeLine W8 PM from Andritz

First Quality Tissue

Lock Haven, PA

TAD

70,000

2016:Q4

TAD PM likely Valmet

Confidential

Confidential

Conv

70,000

2016

Metso Advantage

DCT

Net Capacity Change through 2016

594,000

Announced New Capacity in 2017

Orchids Paper Products

Barnwell, SC

Conv

35,000

2017:Q1

PM likely Valmet

Resolute

Forest Products

Calhoun, TN

Conv

66,000

2017:Q1

Valmet

Advantage

NTT

Procter & Gamble

Box Elder, UT

TAD

80,000

2017:Q3

Retail/Brand/Bounty

Net Capacity Change through 2017

181,000

Capacity Changes in the North American Tissue Industry