Clearwater Paper Corporation · NYSE:CLW
Clearwater Paper — Q1 2024 Earnings Presentation
19 slides from Clearwater Paper's earnings presentation, Apr 29, 2024
Slide 1: Clearwater Paper Corporation First Quarter Earnings Release Materials
CLEARWATER PAPER CORPORATION FIRST QUARTER EARNINGS RELEASE MATERIALS APRIL 29, 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 the Private Securities Litigation Reform Act of 1995 as amended
Slide 3: Q1 2024 Business Highlights
Q1 2024 BUSINESS HIGHLIGHTS Overall • Net sales $496 million, down 6% versus Q1 2023 • Net income $17 million, down $7 million versus Q1 2023 • Adjusted net income $24 million, down $1 million versus Q1 2023 • Adjusted EBITDA $62 million, down $4 million versus Q1 2023 • $15 to $17 million impact fr
Slide 4: Business Update – Pulp and Paperboard
BUSINESS UPDATE – PULP AND PAPERBOARD IMPROVING DEMAND AND HIGHER CAPACITY UTILIZATION Industry (SBS) • Shipments, production, and operating rates increased in Q1 2024 versus Q4 2023 based on AF&PA data • Shipments (in tons) improved 7.1% from Q4 2023 • Production improved 10.5% from Q4 2023 • Opera
Slide 5: Business Update – Consumer Products
BUSINESS UPDATE – CONSUMER PRODUCTS SHIPMENTS STRENGTHENED; DEMAND REMAINED STRONG Industry • Consumers shifting to private brands with economic uncertainty and inflation • Private brand market share remained at 36%1 • Nearly 96% capacity utilization YTD February 2024 based on RISI data Clearwater P
Slide 6: Financial Performance
FINANCIAL PERFORMANCE ($ IN MILLIONS, EXCEPT PER SHARE AMOUNTS) Quarter Ended March 31, December 31, 2024 2023 2023 Net sales $ 496.2 $ 525.4 $ 512.8 Cost of sales 421.6 448.5 437.4 Selling, general and adminstrative 36.2 36.0 36.8 Other operating charges, net 7.9 1.1 2.9 Income from operations 30.4
Slide 7: Segment Profit and Loss and Adjusted EBITDA
SEGMENT PROFIT AND LOSS AND ADJUSTED EBITDA ($ IN MILLIONS) Quarter Ended March 31, December 31, 2024 2023 2023 Net Sales Pulp and Paperboard $ 244.5 $ 278.8 $ 251.3 Consumer Products 253.1 248.3 262.0 Eliminations (1.4) (1.7) (0.5) $ 496.2 $ 525.4 $ 512.8 Operating Income Pulp and Paperboard $ 25.3
Slide 8: Pulp and Paperboard Q1 2024 Results
PULP AND PAPERBOARD Q1 2024 RESULTS Q1 2023 VS. Q1 2024 ADJUSTED EBITDA ($ IN MILLIONS) Lower input costs offset by Impact of higher repair and weather event maintenance resulting in lower due to weather production and event sales Lower pricing © Clearwater Paper Corporation 2024 8
Slide 9: Consumer Products Q1 2024 Results
CONSUMER PRODUCTS Q1 2024 RESULTS Q1 2023 VS. Q1 2024 ADJUSTED EBITDA ($ IN MILLIONS) Higher mix of Higher conventional production and products and shipments lower cost index driven pricing Lower pulp, energy and freight costs © 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 $260.2 • No material near-term debt maturities Less Utilization (3.7) • Corporate/Issuer ratings: Ba2/BB- Plus Unrestricted Cash 55.2 Liquidity $311.7 Capital allocation •
Slide 11: Outlook for Q2'24 and 2024 Overall Assumptions
OUTLOOK FOR Q2’24 AND 2024 OVERALL ASSUMPTIONS Q2 2024: $23 to $33 million1 of adjusted EBITDA • Increasing paperboard demand and production volumes • Continued strong performance in tissue, offset by higher pulp costs • Impact of $40/ton price decrease in paperboard as reported by RISI in February
Slide 12: Appendix
APPENDIX © Clearwater Paper Corporation 2024 12
Slide 13: Pulp and Paperboard Sequential Quarter Results
PULP AND PAPERBOARD SEQUENTIAL QUARTER RESULTS Q4 2023 VS. Q1 2024 ADJUSTED EBITDA ($ IN MILLIONS) Lower Lower maintenance pricing offset by higher wages © Clearwater Paper Corporation 2024 13
Slide 14: Consumer Products Sequential Quarter Results
CONSUMER PRODUCTS SEQUENTIAL QUARTER RESULTS Q4 2023 VS. Q1 2024 ADJUSTED EBITDA ($ IN MILLIONS) Lower cost Higher index driven energy pricing costs © Clearwater Paper Corporation 2024 14
Slide 15: Key Segment Information
KEY SEGMENT INFORMATION Q1’2022 Q2’2022 Q3’2022 Q4’2022 Q1’2023 Q2’2023 Q3’2023 Q4’2023 Q1’2024 Pulp and Paperboard Sales ($ millions) $266.2 $295.8 $300.8 $273.5 $278.8 $272.3 $261.4 $251.3 $244.5 Adjusted EBITDA ($ millions) $59.5 $61.2 $73.0 $26.7 $66.2 $51.3 $53.1 $36.8 $33.7 Paperboard shipment
Slide 16: Reconciliation of Adjusted EBITDA
RECONCILIATION OF ADJUSTED EBITDA ($ IN MILLIONS) Quarter Ended March 31, December 31, 2024 2023 2023 Net income (loss) $ 17.2 $ 23.8 $ 17.6 Income tax provision 7.0 8.4 6.8 Interest expense, net 6.5 7.6 8.0 Depreciation and amortization expense 23.2 24.8 24.7 Other operating charges, net 7.9 1.1 2.
Slide 17: Reconciliation of Adjusted Income
RECONCILIATION OF ADJUSTED INCOME ($ IN MILLIONS, EXCEPT PER SHARE AMOUNTS) Quarter Ended March 31, December 31, 2024 2023 2023 Net income $ 17.2 $ 23.8 $ 17.6 Add back: Income tax provision 7.0 8.4 6.8 Income before income taxes 24.2 32.2 24.4 Add back: Debt retirement costs - 3.1 Other operating c
Slide 18: Additional Reconciliations
ADDITIONAL RECONCILIATIONS ($ IN MILLIONS) Net Debt Mar 31 ‘22 Jun 30 ‘22 Sep 30 ‘22 Dec 31 ‘22 Mar 31 ’23 Jun 30 ‘23 Sep 30 ‘23 Dec 31 ‘23 Mar 31‘24 Cash $ 36.4 $69.5 $50.8 $53.7 $16.7 $41.7 $110.2 $42.0 $55.2 Current debt 1.6 1.0 1.0 0.9 0.9 0.9 0.9 0.8 0.9 Long term debt 617.7 589.9 564.9 564.9 5
Slide 19: Major Maintenance Schedule
MAJOR MAINTENANCE SCHEDULE ADJUSTED EBITDA IMPACT ($ IN MILLIONS) $34 $30 - $35 $30 - $35 $30 $27 $24 $5 2025 $20 $7 $28 or 2026 expected $22 $17 $6 $10 $4 $2 2017 2018 2019 2020 2021 2022 2023 2024e 1,2 2025e1,2 Q1 Q2 Q3 Q4 Total 1. This information is based upon management’s current assumptions an