Rayonier Advanced Materials Inc. · NYSE:RYAM

Rayonier Advanced Materials — Q3 2021 Earnings Presentation

23 slides from Rayonier Advanced Materials's earnings presentation, Nov 2, 2021

  1. Slide 1: Third Quarter 2021 Financial Presentation Materials

    Third Quarter 2021 Financial Presentation Materials November 2, 2021

  2. Slide 2: Safe Harbor

    Safe Harbor Forward-Looking Statements Certain statements in this document regarding anticipated financial, business, legal or other outcomes including business and market conditions, outlook and other similar statements relating to Rayonier Advanced Materials’ future events, developments, or financ

  3. Slide 3: Safe Harbor

    Safe Harbor Regulatory Risks Our business is subject to extensive environmental laws, regulations and permits that may restrict or adversely affect our financial results and how we conduct business; The potential longer-term impacts of climate-related risks remain uncertain at this time. Financial R

  4. Slide 4: Non-GAAP Financial Measures

    Non-GAAP Financial Measures These presentation materials contain certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, adjusted free cash flows, adjusted operating income, adjusted income (loss) from continuing operations and adjusted net debt. These non-GAAP measures are reconcile

  5. Slide 5: Q3'21 Financial and Strategic Highlights

    Q3’21 Financial and Strategic Highlights Revenue from Continuing ◼ Revenue of $374 million from continuing operations Operations by Segment* ◼ Operating income from continuing operations of $3 million ◼ $35 million of Adjusted EBITDA from continuing operations; 11% $3 million increase from prior yea

  6. Slide 6: High Purity Cellulose

    High Purity Cellulose Quarter Ended $ Millions Operating Income/(Loss) Bridge 45 Sep 25, Jun 26, Sep 26, 40 2021 2021 2020 35 30 Key Financials ($ millions) 25 Net Sales $288 $255 $253 20 Operating Income/ 2 11 8 15 8 2 10 Adjusted EBITDA 32 38 36 5 0 Q3'20 Price Volume / Cost SG&A / Q3'21 Sales Mix

  7. Slide 7: Paperboard

    Paperboard Operating Income/(Loss) Bridge $ Millions Quarter Ended 10 Sep 25, Jun 26, Sep 26, 8 2021 2021 2020 6 Key Financials ($ millions) 3 Net Sales $52 $57 $47 4 2 Operating Income/(Loss) 2 2 3 2 Adjusted EBITDA 6 6 7 0 Q3'20 Price Volume / Cost SG&A / Q3'21 Sales Mix Other Paperboard - Volume

  8. Slide 8: High-Yield Pulp

    High-Yield Pulp High-Yield Pulp Operating Income/(Loss) Bridge Quarter Ended $ Millions Sep 25, Jun 26, Sep 26, 14 2021 2021 2020 12 10 Key Financials ($ millions) 8 8 Net Sales $42 $37 $30 6 Operating Income/(Loss) 8 1 1 1 4 Adjusted EBITDA 9 2 3 2 0 Q3'20 Price Volume / Cost SG&A / Q3'21 Sales Mix

  9. Slide 9: Consolidated Operating Income/(Loss) from Continuing Operations

    Consolidated Operating Income/(Loss) from Continuing Operations ($ Millions) Bridge Q3 2020 to Q3 2021 60 50 40 30 20 10 (1) 3 0 (10) Q3'20 Price Volume / Cost SG&A / Q3'21 Sales Mix Other ◼ Operating Income of $3 million; up $4 million from prior year ◼ Improved prices across commodity High Purity

  10. Slide 10: Commodity Prices Moderating

    Commodity Prices Moderating Price ($ / MT) Viscose Price ($ / MT) Fluff 1,200 Delivered to China 1,105 1,800 Delivered to North America 1,618 1,640 1,010 905 1,600 1,000 1,285 1,400 1,183 1,175 1,165 1,107 1,122 800 655 650 675 1,200 635 615 1,000 600 800 400 600 400 200 200 0 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2

  11. Slide 11: Well-Positioned in Current Market

    Well-Positioned in Current Market Strong cash position and improved outlook provide financial flexibility to invest in reliability and growth ◼ Demand for Cellulose Specialties remains strong ◼ Expect significant increases to the majority Cellulose Specialties prices in 2022 High Purity ◼ Expect sig

  12. Slide 12: Driving Lower Costs and EBITDA Margin Growth

    Driving Lower Costs and EBITDA Margin Growth 10% YTD Adjusted CS Price Increases Cost Inflation Increased Reliability Return on Strategic R&D/Innovation EBITDA Margin EBITDA Margin & Lower Cost Investments Current Near-Term Medium-Term Future Not to scale 12

  13. Slide 13: Reducing Net Debt

    Reducing Net Debt Near-term Goal of ~$625 million $ millions 1,000 800 946 877 600 676 ~625 Target 400 2.5x 200 EBITDA 0 Total Debt Cash Net Debt Cash Tax Cash Value Free Cash Strategic Near-Term Softwood Long-Term Refunds of GFP Flow Investment Debt Target Lumber Duty Debt Ratio Shares Deposits 13

  14. Slide 14: Key Investment Highlights

    Key Investment Highlights Leader in High-Value Cellulose Specialties Broad and Diversified Portfolio of Cellulose-based Products Leading R&D Platform with New Product & BioFuture Opportunities Proven Ability to Control Costs and Manage Cash Flows Solid Liquidity and Financial Flexibility with No Sig

  15. Slide 15: Appendix

    RAYONIER Advanced Materials. Appendix

  16. Slide 16: Definitions of Non-GAAP Measures

    Definitions of Non-GAAP Measures EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization. EBITDA is a non-GAAP measure used by our Chief Operating Decision Maker, existing stockholders and potential stockholders to measure how the Company is performing relative t

  17. Slide 17: Definitions of Non-GAAP Measures

    Definitions of Non-GAAP Measures Adjusted Free Cash Flows – Discontinued Operations is defined as cash provided by operating activities from continuing operations adjusted for capital expenditures excluding strategic capital. Adjusted free cash flows is a non- GAAP measure of cash generated during a

  18. Slide 18: Net Sales and Operating Income of Continuing Operations by Segment

    Net Sales and Operating Income of Continuing Operations by Segment ($ Millions) Three Months Ended Nine Months Ended Net sales September 25, September 26, September 25, September 26, (in millions) 2021 June 26, 2021 2020 2021 2020 High Purity Cellulose $ 288 $ 255 $ 253 $ 792 $ 757 .................

  19. Slide 19: Net Sales and Operating Income of Discontinued Operations by Segment

    Net Sales and Operating Income of Discontinued Operations by Segment ($ Millions) Three Months Ended Nine Months Ended Net sales September 25, September 26, September 25, September 26, (in millions) 2021 June 26, 2021 2020 2021 2020 Forest Products $ 83 $ 209 $ 103 $ 439 $ 255 ......................

  20. Slide 20: Consolidated Statements of Income

    Consolidated Statements of Income ($ Millions) Three Months Ended Nine Months Ended September June 26, September September September 25, 2021 2021 26, 2020 25, 2021 26, 2020 Net Sales $ 374 $ 341 $ 323 $ 1,034 $ 972 Cost of Sales (355) (319) (301) (972) (920) Gross Margin 19 22 22 62 52 Selling, gen

  21. Slide 21: Reconciliation of EBITDA by Segment

    Reconciliation of EBITDA by Segment ($ Millions) Three Months Ended September 25, 2021 High Purity High-Yield Corporate & EBITDA by Segment (a): Cellulose Paperboard Pulp Other Total Income (loss) from continuing operations $ 2 $ 2 $ 8 $ (25) (13) Depreciation and amortization 30 4 1 — 35 Interest e

  22. Slide 22: Reconciliation of EBITDA by Segment

    Reconciliation of EBITDA by Segment ($ Millions) Nine Months Ended September 25, 2021 High Purity High-Yield Corporate & EBITDA by Segment (a): Cellulose Paperboard Pulp Other Total Income (loss) from continuing operations $ 20 $ 11 $ 9 $ (61) $ (21) Depreciation and amortization 85 11 2 3 101 Inter

  23. Slide 23: Reconciliation of Adjusted Income

    Reconciliation of Adjusted Income ($ Millions) Three Months Ended Nine Months Ended September 25, June 26, September 26, September 25, September 26, 2021 2021 2020 2021 2020 Adjusted Income (Loss) Per Per Per Per Per from Continuing Diluted Diluted Diluted Diluted Diluted Operations (a): $ Share $ S

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