INVESTOR PRESENTATIONQ1 2020

TSX: HDIwww.hdidist.com

Dark Brown Charleston Oak

CrystaliteRain Cloud Antique Oak Icy Mherge

Oak Retro Baltimore

Certain statements contained in this presentation, including all statements that are not historical facts,contain forward-looking statements and forward-looking information within the meaning of applicablesecurities laws. Forward-looking statements normally contain words like believe, expect, anticipate, plan,intend, continue, estimate, may, will, should and similar expressions. Such statements are not guaranteesof future performance. They are based on management's expectations and assumptions regardinghistorical trends, current conditions and expected future developments, as well as other factors that webelieve are appropriate in the circumstances. Management has based these statements on estimates andassumptions that they believed were reasonable when the statements were prepared. Actual results couldbe substantially different because of the risks and uncertainties associated with the Company's business.More information about the risks and uncertainties affecting the Company's business can be found in the"Risk Factors" section of our Annual Information Form dated March 19, 2020 which is available under theCompany's profile at SEDAR (www.sedar.com).

Although we have attempted to identify factors that would cause actual actions, events or results to differmaterially from those disclosed in the forward-looking statements or information, there may be otherfactors that cause actions, events or results not to be as anticipated, estimated or intended. Also, many ofthe factors are beyond the control of Hardwoods. Accordingly, readers should not place undue reliance onforward-looking statements or information. Hardwoods undertakes no obligation to reissue or update anyforward-looking statements or information as a result of new information or events after the date hereofexcept as may be required by law. All forward-looking statements and information herein are qualified bythis cautionary statement.

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FORWARD LOOKING STATEMENT

In March, as the COVID-19 pandemic spread globally, HDI took immediate actions to protect itsemployees, operations and financial position:

Employees: The health and safety of our over 1,200 employees is our primary concern and wehave instituted a number of policies and procedures to ensure a safe work environment. Ouractions comply with, and in many cases exceed, those recommended by health authorities.

Operations: Our operations meet the definition of an essential business as we provide servicesthat are essential to the support and maintenance of critical infrastructure. As a result, wecontinued to operate, as do the majority of our suppliers and customers. Our distributionlocations are open for business and we continue to deliver products to customers.

Financial Position: We maintain a strong balance sheet which provides financial stability inuncertain times. We have no term debt and maintain revolver facilities with springing covenants,secured against high-quality working capital. Our balance sheet is characterized by $101.9million of liquidity, and as at March 31, 2020, was comprised of $59.8 million cash on hand andborrowing capacity of $42.1 million.

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COVID-19 UPDATE

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In Q1 2020 we achieved record sales and gross profit margin percentage. In April our daily organic sales pace was 23% lower thanin March as a result of the COVID-19 related reduction in economic activity and its impact on the pace of construction in ourmarkets. In May we saw increased activity across our distribution network as the pace of construction activity in many regionsincreased, and average daily organic sales were up 16% in May as compared to April.

In April we took a number of actions to reduce costs, and these measures assisted the Company in generating positive cash flowbefore changes in working capital in the months of April and May.

Consistent with our expectations, additional cash was also generated by reducing working capital in the months of April and May.The Company’s net debt position was reduced in the last two months, in line with our focus on generating cash.

The ultimate impact of the COVID-19 pandemic on the Company’s second quarter and full-year 2020 results is difficult to quantifyas it will depend on the duration of the contagion, the impact of government policies, and the pace of economic recovery. TheCompany remains confident that its business model, cash flow profile, and liquidity will be sufficient to address a varied range ofCOVID-19 scenarios that may occur in 2020.

OUTLOOK

SHAREHODLER RETURNS

CASHFLOW

WORKING CAPITALMaintain sufficient capital reserves to weather the impact of a potential economic slowdown

ACQUISITIONS

Execute on our acquisitions pipeline

Continue returning value to shareholders in the form of dividends and remaining opportunistic as it relates to share repurchases

BALANCE SHEETMANAGEMENTEnsuring continued strong management of the balance sheet

PRIORITIES

Significant cash flow generation, and conversion of EBITDA to cash flow before changes in working capital has averaged 85%

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EBITDA and Cash Flows (in $ millions)1Cash Flow Generation

Conservatively leveraged, no term debt, and during periods of reduced sales activity working capital investment decreases resulting in a source of cash

Debt and Liquidity Profile

BUSINESS MODEL – SIGNIFICANT CASH FLOW GENERATION

March 2020 FY 2019

Net Debt $128.1 $106.4

Adjusted EBITDA after rents(1)(2) $60.2 $54.3

Net Debt to Adjusted EBITDA after rents(1) 2.1 2.0

Unused debt facility and cash on hand $101.9 $84.9

(1) “Adjusted EBITDA after rents” and “Net Debt to Adjusted EBITDA rents” are Non-IFRS and Non GAAP measure. See the Company’s Annual Report and First Quarter MD&A filed on SEDAR.com for a reconciliation of this measures to IFRS and GAAP measures

(2) March 2020 period is presented on a trailing twelve months basis.

Balance Sheet Strength

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1,000 Suppliers WorldwideNo significant supplier concentration(largest less than 7% of commodity type purchases)

67 LocationsMulti-brand go-to-market strategy

450 Strong Sales Team

40,000 CustomersNo customer concentration(largest less than 2% of sales)

15 Specification RepsDirectly marketing to architects and designers

Manufacturers

ResidentialCustomers 50%

CommercialCustomers 40% Diversified 10%

Architects & Designers

BUSINESS MODEL – SIGNIFICANT DIVERSITY

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2019 Sales by Major ProductProduct Diversification

Focus on the distribution ofArchitectural building products

Industrial customers use these products to make end-use applications for the residential, repair and remodel, and diversified construction markets

North American wide footprint, strong presence in the U.S market

BUSINESS MODEL – SIGNIFICANT DIVERSITY

Geography10%

90%

Canada U.S.

2019 Revenue By Country

Estimated N.A market share = 10%

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COMPREHENSIVE NORTH AMERICAN NETWORK

CONSISTENT GROWTH

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Sales (in $ millions) and Gross Profit Percentage

Sales of $1.2 billion,$625 million from acquiredbusinesses. Compound annualsales growth rate of 22%From 2010 - 2019

Price pass through businessmodel results in a consistent gross profit percentage

Sales Growth and Gross Profit %

Adjusted Earnings Per Share (in $)

Growth leads to strong earnings per share, and accretive growth for shareholders

Compound annual growth rate of 43% from 2010 - 2019

Adjusted EarningsPer Share (in $)

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Our shareholder returns have generally exceeded the TSX and TSX small cap indices(graph measured to the end of 2019)

Share returns include share repurchases and dividends

2.5% dividend yield (based on a $14 share price)

Dividends have been increased every year for the last seven years. Payout ratio has averaged 20%

Total Shareholder Returns

ATTRACTIVE SHAREHOLDER RETURNS

Quarterly Dividends Per ShareQuarterly DividendsPer Share

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• Anticipated market growth of 2% per year• Strategic initiatives yielding additional share growth of 2% - 4% per year• Acquisitions targeting another 3% - 5% per year

We are the largest distributor of architectural building products in North America and have 10% market share. Significant opportunity exists for both organic and inorganic growth, and we are strategically positioned to achieve it.

Growth

LONG TERM GROWTH STRATEGY

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• Industry fundamentals remain strong despite effects of the COVID-19 pandemic

• Housing starts continue to trail the long term average

• Homeowners are not over-levered

• Age of housing stock remains elevated and remodel activity has been consistent

• Long-term mortgage rates near historic lows

• Consistent demand for new projects expected over the long term

• Strong N.A economy expected over the long-term

Per National Association of Home Builders, April report

Residential Construction

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Commercial Construction

Prolonged period of below-average construction, potential for

catch up growth

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Per FMI Consulting; Construction Outlook Q1 2020 report

ANTICIPATED MARKET GROWTH

Wood Products • Significant market available

• Core competency of HDI

• Products include hardwood lumber, hardwood plywood

• Opportunity to optimize market share

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Decorative Surfaces and Composites• High-growth product segment

• Core products: Composite panels, laminates

• Driven by the latest design trends and market preferences

• Directly marketing to architects and designers with our own specification division:

STRATEGIC INITIATIVES

Taking market share from competitors through two key product driven strategies:

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47 U.S. locations acquired in the last 5

years, +$625MM in revenue added

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• Significant market share available, highly fragmented industry • Robust acquisitions pipeline, dedicated internal resources• Attractive purchase multiples, accretive

Acquisition Date

Target Price Paid (US $)

Annual Revenuesat acquisition (US $)

Key strategic benefits

2020 $3 M $6 M • Geographic and product expansion in Northern California

2019 $34.5 M $58 M• Expands presence in the door & millwork product category

• Expansion into new geographies

• Further expands pipeline of M&A targets

2019 $3.6 M $12 M • Contiguous expansion of our existing California presence

2018 $3.7 M $13 M • Take out a competitor, add key sales people

2017 $6.0 M $25 M • Geographic and product expansion in the US north east

2017 $0.6 M $5 M • Take out a competitor, add key sales people

2016 $107.0 M $282 M

• Geographic expansion (26 locations), minimal overlap

• Product and end-market diversification

• Consolidated vendors and rebates

• Leverage our proprietary global sourcing capability

• Acquire a well developed M&A pipeline

• Consolidate operating systems

2014 $15.0 M $30 M • Addition of new products, new geography

2013 $2.8 M $4 M • Fill in product gap, unique offering

2011 $13.5 M $40 M• Geographic expansion, minimal overlap

• Leverage our proprietary global sourcing capability

EAGLE PLYWOOD

ACQUISITIONS

• HDI supports brands in the market place• Competitors generally will not have same support structure in place• Potential to build a sustainable competitive advantage, improving EBITDA margins over time

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HARDWOODS SPECIALTY PRODUCTS

FRANK PAXTON LUMBER

HARDWOODS MICHIGAN INC.

RUGBY ARCHITECTURALBUILDING PRODUCTS

VENDORS CUSTOMERS

A world-class distributor of architectural building products

PROFIT OPPORTUNITY – OPTIMIZE THE PLATFORM

Largest architectural building products distributor in a fragmented N.A. market

History of generating significant cash flow

Strong balance sheet with significant liquidity available for use

Diverse and predictable business model, suited to operate in the current environment

Consistent and accretive growth, leading to attractive total shareholder returns

Executing on growth strategies, including significant acquisitions opportunity

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WHY HDI?