Closure and Restructuring and Impairment of Long-Lived Assets	9 Months Ended
Sep. 30, 2026
Restructuring And Related Activities [Abstract]
Closure and Restructuring and Impairment of Long-Lived Assets	NOTE 10. _________________ CLOSURE AND RESTRUCTURING AND IMPAIRMENT OF LONG-LIVED ASSETS Idling of Coosa Pines, Alabama mill On March 24, 2026, the Company announced the indefinite idling of operations at its Coosa Pines, Alabama, facility in May 2026. This idling reduced the Company’s annual market pulp production capacity by approximately 270,000 air-dried metric tons and resulted in a workforce reduction of approximately 285 employees. For the three and nine months ended September 30, 2026, the Company recorded nil and $9 million, respectively, of write-off of property, plant and equipment and nil and $3 million, respectively, of write-off of operating lease right-of-use assets, under Impairment of long-lived assets on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Additionally, for the three and nine months ended September 30, 2026, the Company recorded $1 million and $13 million, respectively, of write-off of inventory, $2 million and $10 million, respectively, of severance and termination costs, and nil and $3 million, respectively, of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Impairment of long-lived assets During the year 2025, the Company identified indicators of impairment related to certain non-core pulp and paper assets and Wood Products lumber operations. These indicators were primarily driven by strategic actions to dispose of non-core assets, the indefinite closure and curtailment of certain operations, as well as persistent adverse market conditions affecting the lumber industry, including weaker demand, increased duties and tariffs, and ongoing economic uncertainty. These market conditions and strategic actions continued during the first nine months of 2026. As a result, for the three and nine months ended September 30, 2026, the Company recorded impairment charges of $1 million and $7 million, respectively, in the Wood Products segment, nil and $6 million, respectively, in the Paper and Packaging segment, nil and $1 million, respectively, in the Pulp and Tissue segment, and nil and $2 million, respectively, as corporate charges. For the three and nine months ended September 30, 2026, the impairment charges were recognized as a reduction to the carrying value of property, plant and equipment of $1 million and $7 million, respectively, and operating lease right-of-use assets of nil and $9 million, respectively. These charges were recorded under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Catalyst restructuring and impairment costs, British Columbia mills On January 25, 2024, the Company announced the indefinite curtailment of the Crofton mill paper operations. On December 2, 2025, the Company announced the permanent closure of operations at the Crofton mill. While pulp production is being discontinued, the Company continues to manage the site in compliance with all applicable environmental and other laws and is exploring a variety of possibilities for the future of the site. For the three and nine months ended September 30, 2026, the Company recorded nil and $2 million, respectively, of write-off of inventory, $1 million and $1 million, respectively, of environmental closure costs, and $1 million and $3 million, respectively, of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). For the three and nine months ended September 30, 2025, the Company recorded $2 million and $9 million, respectively, of accelerated depreciation, under Depreciation and amortization on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Additionally, for the three and nine months ended September 30, 2025, the Company recorded $1 million and $1 million, respectively, of severance and termination costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Power generation assets impairment costs On September 8, 2025, the Company transferred certain power generation assets to PECHC, an affiliated company, through the creation and transfer of a special purpose entity. As a result, these power generation assets were evaluated for impairment and during the third quarter of 2025, the Company recorded $8 million of write-off of property, plant and equipment and off-market contracts, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Cost reduction measures On August 20, 2025, as a result of a strategic review of its operations, the company announced the indefinite idling of the Grenada, Mississippi, newsprint mill and the closure of the Addison, Illinois, and Nogales, Mexico, converting facilities. The Nogales facility ceased operations in August, while the Grenada mill and the Addison facility ceased operations in September. During the third quarter of 2025, the Company recorded $1 million of write-off of property, plant and equipment, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Additionally, the Company recorded $17 million of write-off of inventory, $8 million of severance and termination costs and $3 million of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Idling and sale of Espanola, Ontario mill On April 9, 2025, the Company signed a purchase agreement for the sale of its Espanola facility. On October 17, 2025, the Company completed the sale. As a result, for the three and nine months ended September 30, 2025, the Company recorded $2 million and $14 million, respectively, of write-off of property, plant and equipment, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Other Costs For the three and nine months ended September 30, 2026, other costs related to previous and ongoing closures and restructuring included nil and $4 million, respectively, of severance and termination costs (2025 – nil and $1 million, respectively), and $7 million and $27 million, respectively, of other costs (2025 – $2 million and $3 million, respectively).

Closure and Restructuring and Impairment of Long-Lived Assets

9 Months Ended

Sep. 30, 2026

Restructuring And Related Activities [Abstract]

Closure and Restructuring and Impairment of Long-Lived Assets

NOTE 10.

_________________

CLOSURE AND RESTRUCTURING AND IMPAIRMENT OF LONG-LIVED ASSETS

Idling of Coosa Pines, Alabama mill

On March 24, 2026, the Company announced the indefinite idling of operations at its Coosa Pines, Alabama, facility in May 2026. This idling reduced the Company’s annual market pulp production capacity by approximately 270,000 air-dried metric tons and resulted in a workforce reduction of approximately 285 employees.

For the three and nine months ended September 30, 2026, the Company recorded nil and $9 million, respectively, of write-off of property, plant and equipment and nil and $3 million, respectively, of write-off of operating lease right-of-use assets, under Impairment of long-lived assets on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).

Additionally, for the three and nine months ended September 30, 2026, the Company recorded $1 million and $13 million, respectively, of write-off of inventory, $2 million and $10 million, respectively, of severance and termination costs, and nil and
$3 million, respectively, of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).

Impairment of long-lived assets

During the year 2025, the Company identified indicators of impairment related to certain non-core pulp and paper assets and Wood Products lumber operations. These indicators were primarily driven by strategic actions to dispose of non-core assets, the indefinite closure and curtailment of certain operations, as well as persistent adverse market conditions affecting the lumber industry, including weaker demand, increased duties and tariffs, and ongoing economic uncertainty.

These market conditions and strategic actions continued during the first nine months of 2026. As a result, for the three and nine months ended September 30, 2026, the Company recorded impairment charges of $1 million and $7 million, respectively, in the Wood Products segment, nil and $6 million, respectively, in the Paper and Packaging segment, nil and $1 million, respectively, in the Pulp and Tissue segment, and nil and $2 million, respectively, as corporate charges.

For the three and nine months ended September 30, 2026, the impairment charges were recognized as a reduction to the carrying value of property, plant and equipment of $1 million and $7 million, respectively, and operating lease right-of-use assets of nil and
$9 million, respectively. These charges were recorded under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).

Catalyst restructuring and impairment costs, British Columbia mills

On January 25, 2024, the Company announced the indefinite curtailment of the Crofton mill paper operations. On December 2, 2025, the Company announced the permanent closure of operations at the Crofton mill. While pulp production is being discontinued, the Company continues to manage the site in compliance with all applicable environmental and other laws and is exploring a variety of possibilities for the future of the site.

For the three and nine months ended September 30, 2026, the Company recorded nil and $2 million, respectively, of write-off of inventory, $1 million and $1 million, respectively, of environmental closure costs, and $1 million and $3 million, respectively, of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).

For the three and nine months ended September 30, 2025, the Company recorded $2 million and $9 million, respectively, of accelerated depreciation, under Depreciation and amortization on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Additionally, for the three and nine months ended September 30, 2025, the Company recorded $1 million and
$1 million, respectively, of severance and termination costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).

Power generation assets impairment costs

On September 8, 2025, the Company transferred certain power generation assets to PECHC, an affiliated company, through the creation and transfer of a special purpose entity. As a result, these power generation assets were evaluated for impairment and during the third quarter of 2025, the Company recorded $8 million of write-off of property, plant and equipment and off-market contracts, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).

Cost reduction measures

On August 20, 2025, as a result of a strategic review of its operations, the company announced the indefinite idling of the Grenada, Mississippi, newsprint mill and the closure of the Addison, Illinois, and Nogales, Mexico, converting facilities. The Nogales facility ceased operations in August, while the Grenada mill and the Addison facility ceased operations in September.

During the third quarter of 2025, the Company recorded $1 million of write-off of property, plant and equipment, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Additionally, the Company recorded $17 million of write-off of inventory, $8 million of severance and termination costs and $3 million of other costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).

Idling and sale of Espanola, Ontario mill

On April 9, 2025, the Company signed a purchase agreement for the sale of its Espanola facility. On October 17, 2025, the Company completed the sale. As a result, for the three and nine months ended September 30, 2025, the Company recorded $2 million and $14 million, respectively, of write-off of property, plant and equipment, under Impairment of long-lived assets on the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).

Other Costs

For the three and nine months ended September 30, 2026, other costs related to previous and ongoing closures and restructuring included nil and $4 million, respectively, of severance and termination costs (2025 – nil and $1 million, respectively), and $7 million and $27 million, respectively, of other costs (2025 – $2 million and $3 million, respectively).