Slide 1: First Quarter 2016 Financial Presentation Materials
First Quarter 2016 Financial Presentation Materials
Slide 2: Safe Harbor
Safe Harbor 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 financial or operational performan
Slide 3: Financial Highlights
Financial Highlights ($ Millions) Quarter Ended 1Q 2016 1Q 2015 Sales $ 218 $ 221 Operating Income (Loss) 32 24 Pro Forma Operating Income* 32 24 Net Income (Loss) 21 11 Pro Forma Net Income* 15 11 EBITDA* 63 46 Pro Forma EBITDA* 54 46 Pro Forma Net Income per Share* $ 0.36 $ 0.25 * Non-GAAP measure
Slide 4: Pro Forma Operating Income - Variance Analysis
Pro Forma Operating Income - Variance Analysis 1Q 2016 versus 1Q 2015 ($ Millions) Three Months Ended 5 32 12 24 (12) 3 1Q 2015 Price Volume / Costs SG&A and Other 1Q 2016 Sales Mix Price variance is calculated for all products. Volume variance is calculated on a contribution margin basis. 4
Slide 5: Selected Financial and Operating Information
Selected Financial and Operating Information Three Months Ended March 26, March 28, 2016 2015 Sales Volume, thousands of metric tons Cellulose specialties 106 107 Commodity products 75 58 Total 181 165 Average Sales Price, $ per metric ton Cellulose specialties $ 1,555 $ 1,667 Commodity products $ 6
Slide 6: Capital Resources & Liquidity
Capital Resources & Liquidity ($ Millions) Three Months Ended March 26, 2016 March 28, 2015 Cash Provided by Operating Activities $ 74 $ 56 Cash Used for Investing Activities (20) (24) Cash Used for Financing Activities (45) (20) Adjusted Free Cash Flow* 54 32 EBITDA* 63 46 Pro Forma EBITDA* 54 46 D
Slide 7: 2016 Full Year Guidance
2016 Full Year Guidance ▪ CS prices 6 to 7% below 2015 average prices ▪ CS volumes down 4 to 5% from 2015 ▪ Commodity sales volumes higher than 2015 ▪ Pro forma EBITDA raised to $185 to $200 million ▪ Expected cost savings of $25 to $40 million ▪ CapEx of approximately $90 million ▪ Free cash flow o
Slide 8: Cost Improvement Initiatives
Cost Improvement Initiatives ($ Millions) * Breakdown of future cost savings on a run-rate basis included for illustrative purposes. To be refined in future periods. 8
Slide 9: Our Long-Term Growth Strategy
Our Long-Term Growth Strategy ▪ Three-year Transformation Initiative to enhance profitability — Improve costs by $75 to $90 million run-rate over the next three years — Maintain efficient and reliable operations — Optimize assets to match market conditions ▪ Innovation Initiative to drive growth and
Slide 10: Outlook
Outlook ▪ Transformation Initiative on track — $13 million achieved of 2016 $25 million target — $48 million of cost improvement since 2014 ▪ Progress on Innovation Initiative — Continue to add capabilities to R&D — Numerous projects currently in stage gate process with many in customer trials ▪ Thr
Slide 11: Appendix
RAYONIER Advanced Materials. Appendix
Slide 12: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures EBITDA is defined as earnings before interest, taxes, depreciation and amortization. EBITDA is a non-GAAP measure used by our Chief Operating Decision Maker, existing stockholders and potential stockholders to measure how the Company is performing relative to the ass
Slide 13: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) Three Months Ended March 26, 2016 March 28, 2015 EBITDA Reconciliation Net Income $ 21 $ 11 Depreciation and amortization 22 22 Interest expense, net 9 9 Income tax expense 11 4 EBITDA $ 63 $ 46 Gain on debt extinguishment (9) — Pro Forma EBITDA $ 54
Slide 14: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) Three Months Ended March 26, 2016 March 28, 2015 Adjusted Net Debt Reconciliation Current maturities of long-term debt $ 8 $ 8 Long-term debt 797 906 Total debt 805 914 Original issue discount and debt issuance costs 10 12 Cash and cash equivalents (1
Slide 15: Reconciliation of Reported to Pro Forma Earnings
Reconciliation of Reported to Pro Forma Earnings ($ Millions, except per share amounts) Three Months Ended March 26, 2016 December 31, 2015 March 28, 2015 Per Per Per Diluted Diluted Diluted Pro Forma Operating Income and Net Income: $ Share $ Share $ Share Operating Income $ 32 $ 29 $ 24 One-time s
Slide 16: Debt Maturity Schedule
Debt Maturity Schedule Millions $900 $800 253 $700 240 $600 $500 55 $400 $300 506 506 $200 $100 38 6 10 11 3* $0 0 Total 2016 2017 2018 2019 2020 Thereafter Senior Notes 5.5% Term A-1 Loan Facility Term A-2 Loan Facility Revolver ($250m Line of Credit) * $3 million of Term A-2 paid in 2020 16