Clearwater Paper Corporation · NYSE:CLW
Clearwater Paper — Q2 2024 Earnings Presentation
17 slides from Clearwater Paper's earnings presentation, Aug 6, 2024
Slide 1: Clearwater Paper Second Quarter Earnings Release Materials
CLEARWATER PAPER CORPORATION SECOND QUARTER EARNINGS RELEASE MATERIALS AUGUST 6, 2024 ARSEN KITCH President, Chief Executive Officer and Director SHERRI BAKER Senior Vice President and Chief Financial Officer
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Cautionary Statement Regarding Forward Looking Statements This presentation of supplemental information contains, in addition to historical information, certain “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Se
Slide 3: Q2 2024 Business Highlights
Q2 2024 BUSINESS HIGHLIGHTS Overall • Net sales $586 million, up 12% versus Q2 2023 • Net loss $26 million compared to net income $30 million in Q2 2023 • Adjusted EBITDA $35 million compared to $72 million in Q2 2023 Pulp and Paperboard • SBS prices down 14% versus Q2 2023, 5% lower versus Q1 2024
Slide 4: Business Update – Pulp and Paperboard
BUSINESS UPDATE – PULP AND PAPERBOARD IMPROVING DEMAND AND STEADY CAPACITY UTILIZATION Industry (SBS) • Shipments increased in Q2 2024 versus Q1 2024 based on AF&PA data • Shipments (in tons) improved 0.9% from Q1 2024 • Production declined 6% from Q1 2024, inventory levels dropped 16% • Operating r
Slide 5: Business Update – Consumer Products
BUSINESS UPDATE – CONSUMER PRODUCTS SHIPMENTS STRENGTHENED; DEMAND REMAINED STRONG Industry • Consumers continue to shift to private brands with economic uncertainty and inflation • Private brand market share increased to 38%1 • Over 95% capacity utilization YTD May 2024 based on RISI data Clearwate
Slide 6: Financial Performance
FINANCIAL PERFORMANCE ($ IN MILLIONS, EXCEPT PER SHARE AMOUNTS) Quarter Ended Year to date June 30, June 30, 2024 2023 2024 2023 Net sales $ 586.4 $ 524.6 $ 1,082.6 $ 1,050.0 Cost of sales 550.8 438.7 972.5 887.2 Selling, general and adminstrative 38.0 39.1 74.3 75.1 Other operating charges, net 17.
Slide 7: Segment Profit and Loss and Adjusted EBITDA
SEGMENT PROFIT AND LOSS AND ADJUSTED EBITDA ($ IN MILLIONS) Quarter Ended Year to Date June 30, June 30, 2024 2023 2024 2023 Net Sales Pulp and Paperboard $ 333.6 $ 272.3 $ 578.1 $ 551.0 Consumer Products 252.8 253.6 505.9 502.0 Eliminations - (1.3) (1.4) (3.0) $ 586.4 $ 524.6 $ 1,082.6 $ 1,050.0 Op
Slide 8: Pulp and Paperboard Q2 2024 Results
PULP AND PAPERBOARD Q2 2024 RESULTS Q2 2023 VS. Q2 2024 ADJUSTED EBITDA ($ IN MILLIONS) Planned major maintenance offset by insurance recovery and lower input costs Higher sales Lower pricing volume offset by lower production from outage © Clearwater Paper Corporation 2024 8
Slide 9: Consumer Products Q2 2024 Results
CONSUMER PRODUCTS Q2 2024 RESULTS Q2 2023 VS. Q2 2024 ADJUSTED EBITDA ($ IN MILLIONS) Lower pulp Higher and freight Lower index production and based pricing costs sales volume and higher mix of conventional products © Clearwater Paper Corporation 2024 9
Slide 10: Capital Structure and Allocation
CAPITAL STRUCTURE AND ALLOCATION Capital structure summary Liquidity Profile ($ in millions)1 • Ample liquidity ABL Availability $278.2 • No material near-term debt maturities Less Utilization (93.7) • Corporate/Issuer ratings: Ba2/BB- Plus Unrestricted Cash 39.6 Liquidity $224.1 Capital allocation
Slide 11: Outlook for Q3'24 and 2024 Overall Assumptions
OUTLOOK FOR Q3’24 AND 2024 OVERALL ASSUMPTIONS Q3 2024: $58 to $68 million1 of adjusted EBITDA • Increasing paperboard demand and production volumes • Lower maintenance outage cost impact • Continued strong performance in tissue, partly offset by higher pulp costs FY 2024 operational assumptions vs.
Slide 12: Appendix
APPENDIX © Clearwater Paper Corporation 2024 12
Slide 13: Pulp and Paperboard Sequential Quarter Results
PULP AND PAPERBOARD SEQUENTIAL QUARTER RESULTS Q1 2024 VS. Q2 2024 ADJUSTED EBITDA ($ IN MILLIONS) Planned major outage offset by insurance recovery and lower input costs Higher sales Lower volume offset by pricing lower production from outage © Clearwater Paper Corporation 2024 13
Slide 14: Consumer Products Sequential Quarter Results
CONSUMER PRODUCTS SEQUENTIAL QUARTER RESULTS Q1 2024 VS. Q2 2024 ADJUSTED EBITDA ($ IN MILLIONS) Lower index Lower Higher pulp driven production costs offset pricing by lower mill costs © Clearwater Paper Corporation 2024 14
Slide 15: Key Segment Information
KEY SEGMENT INFORMATION Q2’2022 Q3’2022 Q4’2022 Q1’2023 Q2’2023 Q3’2023 Q4’2023 Q1’2024 Q2’2024 Pulp and Paperboard Sales ($ millions) $295.8 $300.8 $273.5 $278.8 $272.3 $261.4 $251.3 $244.5 $333.6 Adjusted EBITDA ($ millions) $61.2 $73.0 $26.7 $66.2 $51.3 $53.1 $36.8 $33.7 $11.1 Paperboard shipment
Slide 16: Reconciliation of Adjusted EBITDA
RECONCILIATION OF ADJUSTED EBITDA ($ IN MILLIONS) Quarter Ended Six Months Ended June 30, March 31, June 30, 2024 2023 2024 2024 2023 Net income (loss) $ (25.8) $ 29.7 $ 17.2 $ (8.6) $ 53.5 Income tax (benefit) provision (9.4) 10.2 7.0 (2.4) 18.6 Interest expense, net 16.0 7.5 6.5 22.6 15.1 Deprecia
Slide 17: Additional Reconciliations
ADDITIONAL RECONCILIATIONS ($ IN MILLIONS) Net Debt Jun 30 ‘22 Sep 30 ‘22 Dec 31 ‘22 Mar 31 ’23 Jun 30 ‘23 Sep 30 ‘23 Dec 31 ‘23 Mar 31‘24 Jun 30’24 Cash $69.5 $50.8 $53.7 $16.7 $41.7 $110.2 $42.0 $55.2 $39.6 Current debt 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.9 5.2 Long term debt 589.9 564.9 564.9 564.9 564