Slide 1: Third Quarter 2024 Earnings
1 Third Quarter 2024 Earnings November 12, 2024 © 2024 Sylvamo Corporation. All rights reserved.
Slide 2: Cautionary statement concerning forward-looking statements
Cautionary statement concerning forward-looking statements 2 This presentation contains information that includes or is based upon forward-looking statements. Forward-looking statements forecast or state expectations concerning future events. These statements often can be identified by the fact that
Slide 3: Statement relating to non-U.S. financial GAAP measures
Statement relating to non-U.S. financial GAAP measures 3 While Sylvamo reports its financial results in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), during the course of this presentation, certain non-U.S. GAAP financial measures are presented. Managem
Slide 4: 3Q24 Highlights
3Q24 Highlights 4 • Strong commercial and operational performance • Stable input costs • Outstanding earnings and cash generation © 2024 Sylvamo Corporation. All rights reserved.
Slide 5: 3Q24 Key Financial Metrics
3Q24 Key Financial Metrics 5 Adjusted EBITDA Free Cash Flow Adjusted Operating and Margin Earnings per Share $193 $2.44 $155 $158 $164 $1.98 $119 $1.70 $62 18% 18% 20% 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 Adjusted EBITDA and Free Cash Flow figures are in $ millions © 2024 Sylvamo Corporation
Slide 6: 3Q24 Adjusted EBITDA better than our Outlook
3Q24 Adjusted EBITDA better than our Outlook 6 3Q24 vs. 2Q24 $ Million 3Q24 Outlook ($5) - $0 $10 - $15 ($15) - ($10) $28 ($10) - ($5) $170 - $185 (Aug 9, 2024) $28 ($4) $193 $164 ($4) $10 ($1) 18% 20% 2Q24 Price & Mix Volume Operations and Maintenance Input and 3Q24 Other Costs Outages Transportati
Slide 7: 4Q24 Adjusted EBITDA Outlook: $150 - $165 Million
4Q24 Adjusted EBITDA Outlook: $150 - $165 Million 7 4Q24 vs. 3Q24 $ Million Pulp and paper price decreases in Europe, higher Price and Mix Unfavorable: ($20) - ($25) export mix and customer mix in the Americas Volume Favorable: $15 - $20 Primarily stronger seasonality in Latin America Operations and
Slide 8: On target to exceed our $110 million Project Horizon cost reduction goal
On target to exceed our $110 million Project Horizon cost reduction goal 8 Streamlining our organization and reducing costs to become a leaner, stronger company Manufacturing & $110 million Selling & Supply Chain 2024 Year-end Run Rate Administrative Targeted Savings1 $80 million $30 million ¹Before
Slide 9: Georgetown supply agreement exit will help optimize our North American business
Georgetown supply agreement exit will help optimize our North American business 9 Exiting ~150,000 tons will result in ~($40) million earnings impact, assuming 2024 margins Retaining ~100,000 tons of the most profitable products Reducing economic downtime in our mill system Improving product
Slide 10: North America uncoated freesheet industry capacity reducing by ~10% by 1Q25
North America uncoated freesheet industry capacity reducing by ~10% by 1Q25 10 Supply position estimate as of 2Q24 Supply position after 2024 industry capacity reductions1 Others Others 20% 20% Domtar Domtar 36% 36% PCA PCA 7% 27% 8% 25% Sylvamo Sylvamo Pixelle 10% Pixelle 11% IP Supply Sylvamo IP S
Slide 11: Europe & North America capacity reductions will improve industry conditions
Europe & North America capacity reductions will improve industry conditions 11 Europe Latin America North America Supply 2025 versus 2024 - Uncoated Freesheet (7%) Flat (10%) Demand (2%) Flat (3%) 2025 versus 2024 Uncoated Freesheet Supply and Demand variance reflect estimated figures. Source: Pulp
Slide 12: Favorable Ruling in Brazilian Goodwill Tax Dispute
Favorable Ruling in Brazilian Goodwill Tax Dispute 12 • Positive development in the ongoing dispute with Brazilian authorities over goodwill tax deductions • A Brazilian court has ruled in our favor on a case covering 2/3 of the amount disputed • We are in discussions with our lenders about the poss
Slide 13: Confident in our future and motivated by opportunities that lie ahead
Confident in our future and motivated by opportunities that lie ahead 13 Creating shareowner value through cash generation and disciplined capital allocation • Generated outstanding Free Cash Flow in 3Q • Reinvesting in our businesses to increase earnings and cash flows • Simplifying North America b
Slide 14: Appendix
14 Appendix © 2024 Sylvamo Corporation. All rights reserved.
Slide 15: Contacts
Contacts 15 Hans Bjorkman Vice President, Investor Relations Investor Relations +1-901-519-8030 hans.bjorkman@sylvamo.com Adam Ghassemi Senior Manager, Corporate Communications Media +1-901-519-8115 adam.ghassemi@sylvamo.com © 2024 Sylvamo Corporation. All rights reserved.
Slide 16: Favorable Ruling in Brazilian Goodwill Tax Dispute
Favorable Ruling in Brazilian Goodwill Tax Dispute 16 • The deductibility of goodwill from International Paper’s 2007 acquisition of the Luis Antonio mill has been under dispute with Brazilian tax authorities since before our spinoff • If a settlement or unfavorable judgement occurs, IP would pay 60
Slide 17: Selected Annual Financial Guidance
Selected Annual Financial Guidance 17 2023 2024 $ Million Actual Outlook Total Maintenance Outage Costs $89 $73 Maintenance & Regulatory $143 $125 - $130 Brazil Reforestation $34 $55 Capital Spending High-return Projects $33 $30 - $35 Total $210 $210 - $220 Depreciation & Amortization $143 $159 Net
Slide 18: 1.1x Net Debt-to-Adjusted EBITDA - September 30, 2024
1.1x Net Debt-to-Adjusted EBITDA - September 30, 2024 18 Gross Debt $ Million $1,520 $1,397 $1,026 $950 $918 Initial Gross Debt at Dec 21 Dec 22 Dec 23 Sep 24 Spinoff Notes Term Loan F Term Loan F 2 Term Loan B Term Loan A AR Securitization 1.6x Gross Debt-to-Adjusted EBITDA as of September 30, 2024
Slide 19: Debt Maturity Profile
Debt Maturity Profile 19 September 30, 2024 $ Million $441 $189 $161 $41 $41 $23 $10 $12 2024 2025 2026 2027 2028 2029 2030 2031 Term Loan F AR Securitization Term Loan A Term Loan F 2 Debt maturity profile includes anticipated minimum amortization payments by year. © 2024 Sylvamo Corporation. All r
Slide 20: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation 20 $ Million 3Q23 2Q24 3Q24 Cash Provided by Operating Activities $197 $115 $163 Cash Invested in Capital Projects ($42) ($53) ($44) Free Cash Flow $155 $62 $119 Free cash flow is a non-GAAP measure and the most directly comparable GAAP measure is cash provided by opera
Slide 21: 3Q24 vs. 2Q24 Free Cash Flow
3Q24 vs. 2Q24 Free Cash Flow 21 $ Million 2Q24 3Q24 Variance Adjusted EBITDA $164 $193 $29 Cash Taxes ($27) ($18) $9 Cash Interest ($11) ($13) ($2) Cash Special Items ($4) ($5) ($1) Other Changes in Working Capital ($7) $6 $13 Cash Provided by Operating Activities $115 $163 $48 Capital Spending ($53
Slide 22: 3Q24 vs. 3Q23 Free Cash Flow
3Q24 vs. 3Q23 Free Cash Flow 22 $ Million 3Q23 3Q24 Variance Adjusted EBITDA $158 $193 $35 Cash Taxes ($18) ($18) - Cash Interest ($17) ($13) $4 Cash Special Items ($3) ($5) ($2) Other Changes in Working Capital $77 $6 ($71) Cash Provided by Operating Activities $197 $163 ($34) Capital Spending ($42
Slide 23: Free Cash Flow by Quarter - Since Spinoff
Free Cash Flow by Quarter - Since Spinoff 23 $ Million $155 $114 $119 $109 $104 $84 $62 1Q 2Q $39 $32 $33 3Q 4Q $2 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 ($33) © 2024 Sylvamo Corporation. All rights reserved.
Slide 24: Adjusted EBITDA and Margin Reconciliation
Adjusted EBITDA and Margin Reconciliation 24 4Q24 $ Million 3Q23 2Q24 3Q24 Outlook Net Income (Loss) $58 $83 $95 $66 - $77 Depreciation, Amortization, Cost of Timber Harvested 36 37 39 43 Interest (Income) Expense, Net 9 9 14 8 Income Tax Provision 33 30 37 27 - 31 Adjustments Equity-based Compensat
Slide 25: Adjusted EBITDA and Margin Reconciliation
Adjusted EBITDA and Margin Reconciliation 25 $ Million 3Q23 2Q24 3Q24 Adjusted EBITDA Europe (5) 17 11 Latin America 74 55 69 North America 89 92 113 Total Business Segment Adjusted EBITDA $158 $164 $193 Net Sales (excluding Inter-segment Sales eliminations) Europe 184 206 194 Latin America 246 245
Slide 26: Adjusted Operating Earnings per Share Reconciliation
Adjusted Operating Earnings per Share Reconciliation 26 $ Million 3Q23 2Q24 3Q24 Net Income (Loss) $58 $83 $95 Special Items Expense (Income) $14 - $7 Adjusted Operating Earnings $72 $83 $102 Adjusted Operating Earnings per Share $1.70 $1.98 $2.44 Adjusted Operating Earnings is a non-GAAP measure pr
Slide 27: Capacity by Grade - Effective 1Q25
Capacity by Grade - Effective 1Q25 27 000 Short Tons Uncoated Papers Market Pulp Total Nymolla 500 - 500 Saillat 265 130 395 Europe 765 130 895 Luis Antonio 385 130 515 Mogi Guacu 460 35 495 Tres Lagoas 260 - 260 Latin America 1,105 165 1,270 Eastover 700 115 815 Ticonderoga 275 - 275 North America
Slide 28: Sylvamo global uncoated freesheet capacity will go from ~3.5 to ~3.2 million tons
Sylvamo global uncoated freesheet capacity will go from ~3.5 to ~3.2 million tons 28 Europe Nymolla 500 765 Thousand Tons Saillat 265 Mogi Guacu 460 Latin America Luis Antonio 385 1,105 Thousand Tons Tres Lagoas 260 North America Eastover 700 Sylvamo Mills Ticonderoga 275 975 Thousand Tons Supply Ag
Slide 29: 3Q24 Sales Volume
3Q24 Sales Volume 29 Latin North 000 Short Tons Europe Sylvamo America America Uncoated Papers 155 260 381 796 Market Pulp 36 33 31 100 Total 896 Sales volume includes revenue recognition © 2024 Sylvamo Corporation. All rights reserved.
Slide 30: 2024 Economic Downtime
2024 Economic Downtime 30 000 Short Tons 1Q24 2Q24 3Q24 YTD Europe - 13 27 40 Latin America - - - - Paper North America 11 10 29 50 Total 11 23 56 90 Europe - 2 2 4 Latin America - - - - Pulp North America - - - - Total - 2 2 4 © 2024 Sylvamo Corporation. All rights reserved.
Slide 31: 2023 - 2024 Economic Downtime
2023 - 2024 Economic Downtime 31 Thousand tons 185 150 61 27 98 23 56 124 58 123 2 75 25 2 56 11 23 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 UFS Pulp © 2024 Sylvamo Corporation. All rights reserved.
Slide 32: Total Maintenance Outage Costs - 2024 Outlook
Total Maintenance Outage Costs - 2024 Outlook 32 1Q24 2Q24 3Q24 4Q24 2024 $ Million Actual Actual Actual Outlook Outlook Europe - - $1 - $1 Latin America $11 $7 - - $18 North America $14 $22 - $18 $54 Total $25 $29 $1 $18 $73 2025 Europe planned maintenance outages estimated to cost ~$30 to $40 mill
Slide 33: Total Maintenance Outage Costs - 2024 Outlook
Total Maintenance Outage Costs - 2024 Outlook 33 $ Million $73 75% $29 $25 $18 $1 1Q24 Actual 2Q24 Actual 3Q24 Actual 4Q24 Outlook 2024 Outlook Europe Latin America North America Total maintenance outage costs (shown for Sylvamo mills only) include direct maintenance outage expense and related unabs
Slide 34: Quarterly Business Segment Operating Results
Quarterly Business Segment Operating Results 34 Sales D&A Adjusted EBITDA $ Million 3Q23 2Q24 3Q24 3Q24 3Q23 2Q24 3Q24 Europe $184 $206 $194 $8 ($5) $17 $11 Latin America $246 $245 $247 $18 $74 $55 $69 North America $476 $493 $532 $13 $89 $92 $113 Segment Total $906 $944 $973 $39 $158 $164 $193 Sum
Slide 35: 3Q24 vs. 3Q23 Adjusted EBITDA
3Q24 vs. 3Q23 Adjusted EBITDA 35 $ Million $27 $1 ($10) $193 $23 $158 ($6) 18% 20% 3Q23 Price & Mix Volume Operations Maintenance Input and 3Q24 and Costs Outages Transportation Costs © 2024 Sylvamo Corporation. All rights reserved.
Slide 36: Europe Adjusted EBITDA
Europe Adjusted EBITDA 36 3Q24 vs. 2Q24 $17 ($3) ($1) ($1) ($1) $0 $11 8% 6% 2Q24 Price & Mix Volume Operations Maintenance Input and 3Q24 and Costs Outages Transportation Costs $ Million 3Q24 vs. 3Q23 $9 $0 $1 $11 ($5) $4 $2 6% (3%) 3Q23 Price & Mix Volume Operations Maintenance Input and 3Q24 and
Slide 37: Latin America Adjusted EBITDA
Latin America Adjusted EBITDA 37 3Q24 vs. 2Q24 $7 ($9) $10 $69 $55 $6 $0 22% 28% 2Q24 Price & Mix Volume Operations Maintenance Input and 3Q24 and Costs Outages Transportation $ Million Costs 3Q24 vs. 3Q23 $3 $0 ($13) $74 $3 $2 9% $69 19% 30% 28% 3Q23 Price & Mix Volume Operations Maintenance Input
Slide 38: North America Adjusted EBITDA
North America Adjusted EBITDA 38 3Q24 vs. 2Q24 $22 $5 $113 $92 ($7) $11 ($10) 19% 21% 2Q24 Price & Mix Volume Operations Maintenance Input and 3Q24 and Costs Outages Transportation $ Million Costs 3Q24 vs. 3Q23 $15 $1 $2 $113 9% $89 ($13) $19 19% 19% 21% 3Q23 Price & Mix Volume Operations Maintenanc
Slide 39: 3Q24 vs. 2Q24 Input Costs
3Q24 vs. 2Q24 Input Costs 39 Change By Region $ Million Europe Latin America North America $0 ($9) $5 6 2 (1) (1) (1) (6) (3) Fiber Energy Transportation © 2024 Sylvamo Corporation. All rights reserved.
Slide 40: Executing on our Investment Thesis
Executing on our Investment Thesis 40 The World’s Paper Company A Simple, Focused Plan We are the world’s paper company, the: We focus on uncoated freesheet and will create long-term • Employer of Choice value through: • Supplier of Choice • Talented teams • Investment of Choice • Iconic brands We b
Slide 41: Building a better future for people, the planet and our company
41 Building a better future for people, the planet and our company © 2024 Sylvamo Corporation. All rights reserved.