Mr. Stewart Emerson reports

SUPREMEX ANNOUNCES RESTRUCTURING PLAN EXPECTED TO GENERATE $5.7 MILLION IN ANNUALIZED SAVINGS AND PROVIDES UPDATE ON TARIFF IMPACT

Supremex Inc. has provided an update on the expected impact of tariffs on its operations and announced a restructuring plan designed to protect profitability, enhance efficiency and accelerate the company's continuing transformation into a diversified North American leader in paper-based packaging.

Tariff impact and mitigation

Based on tariff measures currently in effect and management's current assessment of trade flows, the company estimates that tariffs will have a net impact on its operating earnings, before taxes, of between $10-million and $12-million on an annualized basis, after giving effect to mitigation measures implemented to date, including commercial pricing actions, supply chain adjustments and the rebalancing of production across its North American manufacturing network, but excluding the restructuring plan discussed below. The company continues to actively pursue additional mitigation alternatives with the objective of further reducing this impact. While management believes the current tariff environment will prove temporary, the company is managing its operations -- and has prepared these estimates -- on the assumption that tariff measures remain in effect as currently enacted.

Restructuring plan

In response to these conditions, Supremex has implemented a restructuring plan that builds on the company's recent investments to permanently reduce its cost base with current market conditions. The plan involves the elimination of approximately 60 positions across the organization, representing approximately 6 per cent of the company's work force, and comprises three components:

• Envelope network alignment: the consolidation of certain activities across the company's Canadian and U.S. envelope locations into centres of excellence supporting multiple locations -- bringing expertise together to improve consistency and operate more efficiently across the network;
• Folding carton consolidation: the transfer of folding carton production from the company's Saint-Laurent, Que., commercial print facility to its flagship folding carton facility in Lachine, Que.; as a result, Supremex will reduce the square footage of its Saint-Laurent commercial print facility, lowering its fixed cost base;
• Deployment of technology: the accelerated deployment of technology across the business, including the modernization of core back-office processes -- enabling a leaner and more scalable support structure.

Once fully implemented, these initiatives are expected to generate annualized cost savings of approximately $5.7-million, with benefits beginning to materialize in the fourth quarter of 2026 and the full run-rate expected in the first quarter of 2027. In connection with the plan, the company expects to record a restructuring charge of approximately $1.8-million before taxes, of which the majority is related to severance and other employee-related costs, in the fourth quarter of 2026. These actions do not alter the company's growth strategy: Supremex continues to pursue targeted acquisitions in packaging, advance the integration of its recently acquired businesses and invest in the capabilities that support its long-term transformation into a diversified North American leader in paper-based packaging.

Management commentary

"The decision to reduce our work force is the most difficult one a management team can make, and it is not one we make lightly," said Stewart Emerson, president and chief executive officer of Supremex. "These colleagues have contributed to everything Supremex has built, and we are deeply grateful for their dedication and service. We are committed to treating every affected employee with fairness, respect and meaningful transition support. At the same time, the trade environment has introduced significant new costs, and we have a responsibility to act decisively to protect the long-term health of the business for our employees, customers and shareholders.

"These actions position Supremex to weather the storm -- and we believe this storm, while fierce, is a passing one," added Mr. Emerson. "The investments we have made across the business now allow us to operate more efficiently without compromising the service and quality our customers expect -- and these actions put that capability to work. Combined with our tariff mitigation measures, this plan is aimed at safeguarding our profitability and ensuring that when trade conditions normalize, Supremex will emerge leaner, stronger and better positioned to execute its growth strategy in paper-based packaging -- creating lasting value for our shareholders."

About Supremex Inc.

Supremex is a growing provider of paper-based packaging solutions and a leading North American manufacturer and marketer of envelopes. Supremex operates nine manufacturing facilities across four provinces in Canada and four manufacturing facilities in three states in the United States employing approximately 900 people, in each case, after giving effect to the restructuring plan. Supremex's extensive network allows it to efficiently manufacture and distribute envelope and packaging solutions designed to the specifications of major national and multinational corporations, direct mailers, resellers, government entities, SMEs (small and medium-sized enterprises) and solutions providers.

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