Slide 1: Q4 2023 Financial Results
Q4 2023 FINANCIAL RESULTS February 22, 2024
Slide 2: Disclaimer
DISCLAIMER FORWARD-LOOKING STATEMENT Certain statements in this presentation, including statements regarding future results and performance, are forward-looking statements within the meaning of securities legislation based on current expectations. The accuracy of such statements is subject to a numb
Slide 3: Summary of Financial Results
SUMMARY OF FINANCIAL RESULTS (In millions of CAN$, except per common share amounts, where noted) 2023 2022 Q4 2023 Q3 2023 Q4 2022 Financial Results Sales 4,638 4,466 1,138 1,198 1,135 Operating income (loss) 40 33 (24) 80 (20) Adjusted earnings before interest, taxes, depreciation and amortization
Slide 4: Overview of Consolidated Profitability Drivers
OVERVIEW OF CONSOLIDATED PROFITABILITY DRIVERS Consolidated EBITDA (A)1 Variation Quarter-over-Quarter Year-over-Year Q4 2023 vs Q3 2023 Q4 2023 vs Q4 2022 2023 vs 2022 (in millions of Canadian dollars) Pricing ($29 million) ($70 million) ($14 million) Freight & Production Costs $6 million $22 milli
Slide 5: Recycled Fibre Costs - Index List Prices
RECYCLED FIBRE COSTS - INDEX LIST PRICES ($ US/s.t.) Current OCC: 300 (Feb-24) • Consistent strong domestic demand, and fibre generation 275 still following lower seasonal generation levels that are in 250 225 line with average pace in recent years 200 • Export volumes remaining consistent 175 149 •
Slide 6: Virgin Pulp Costs - Index List Prices
VIRGIN PULP COSTS - INDEX LIST PRICES ($ US/metric ton) VIRGIN PULP: Current (Jan-24) • Sequential index price increases starting late 2023; 1,800 index prices remain significantly lower YoY 1,600 • Lower NBSK supply from market related downtime 1,400 1,380 and permanent closures in North America •
Slide 7: Packaging Products / Containerboard
PACKAGING PRODUCTS / CONTAINERBOARD Comments on sequential performance Results Change vs. Q4 2023 Q3 2023 Q4 2022 è Total shipments decreased by 6% sequentially. Shipments of parent rolls decreased by 13% and those of converted products increased by 1% compared to the third quarter. The sequential S
Slide 8: Packaging Products / Containerboard
PACKAGING PRODUCTS / CONTAINERBOARD Quarterly EBITDA (A)1 (M CAN$) è Sequential Q4 shipments of converted products: Canada +0.6% (vs. market +0.9%); US +5.6% (vs. market -0.2%) 21% 22% 17% 17% 12% Shipments/day +6.4% 119 126 è Year-over-year Q4 shipments of converted products: 96 101 67 Canada +7.4%
Slide 9: Packaging Products / Specialty Products
PACKAGING PRODUCTS / SPECIALTY PRODUCTS Results Change vs. Comments on sequential performance Q4 2023 Q3 2023 Q4 2022 Sales (M$) è Sales increased by 2% sequentially. This reflects higher volume in our Moulded 160 2% (1)% Pulp sub-segment and the positive impact from the depreciation of the Canadian
Slide 10: Packaging Products / Specialty Products
PACKAGING PRODUCTS / SPECIALTY PRODUCTS Quarterly EBITDA (A)1 (M CAN$) 12% 17% 15% 13% 12% è Cardboard: results decreased sequentially reflecting the impacts of lower volume, less favourable spread following 27 increases in raw material costs, and higher maintenance costs 24 that were associated wit
Slide 11: Tissue Papers
TISSUE PAPERS Results Change vs. Comments on sequential performance Q4 2023 Q3 2023 Q4 2022 è Shipments decreased by 10% on a sequential basis. This reflects a 3% decrease for Shipments (’000 s.t.) converted products and a 60% decrease for parent rolls shipments, the latter of which 121 (10)% (2)% r
Slide 12: Tissue Papers
TISSUE PAPERS Quarterly EBITDA (A)1 (M CAN$) è Q4 2023 Shipments of Converted Products (cases): 14% 16% 11% 2% 4% Retail tissue Away-from-Home tissue 61 61 Q4 vs. Q4: +1.1 million Q4 vs. Q4: +0.1 million 44 Q4 vs. Q3: -0.2 million Q4 vs. Q3: -0.3 million 16 è FY 2023 Shipments of Converted Products
Slide 13: Q4 2023 EBITDA (A) to Operating Loss Reconciliation
Q4 2023 EBITDA (A)1 TO OPERATING LOSS RECONCILIATION (M CAN$) 160 122 120 80 40 (73) 0 (48) -40 (13) (12) (24) 1 EBITDA (A) Depr. & Impairment Other loss (gain) Restructuring Operating loss Amort. charges costs Corporate, Recovery and Container- Specialty Tissue Recycling (M CAN$) board Products Pap
Slide 14: Net Earnings (Loss) - As Reported vs Adjusted
NET EARNINGS (LOSS) - As reported vs adjusted2 NET EARNINGS (LOSS) NET EARNINGS (LOSS) PER COMMON SHARE1 (In millions of Canadian dollars, except per common share amounts) Q4 2023 Q4 2023 As reported (57) ($0.57) Specific items: Impairment charges 48 $0.35 Other loss 13 $0.10 Restructuring costs 12
Slide 15: Quarterly Year-over-Year Adjusted EPS Variance
QUARTERLY YEAR-OVER-YEAR ADJUSTED EPS VARIANCE1,2 0.40 0.03 0.04 0.49 0.22 (0.01) 0.20 (0.06) (0.08) 0.05 0.00 (0.09) $ cents -0.20 (0.27) -0.40 -0.60 (0.62) (0.57) -0.80 2 2 2 EPS reported Specific Adjusted EPS EBITDA (A) Non- Share of Income tax Depreciation Financing Adjusted EPS Specific EPS rep
Slide 16: Quarterly Sequential Adjusted EPS Variance
QUARTERLY SEQUENTIAL ADJUSTED EPS VARIANCE1,2 0.75 0.10 0.44 0.02 0.01 0.50 0.34 (0.01) (0.03) 0.25 (0.09) 0.05 $ cents 0.00 (0.29) -0.25 -0.50 (0.62) (0.57) -0.75 2 2 2 EPS reported Specific Adjusted EPS Non- Financing Share of Depreciation Income EBITDA (A) Adjusted EPS Specific EPS reported Q3 20
Slide 17: Cash Flow Overview
CASH FLOW OVERVIEW 2021 2022 2023 (In millions of CAN$, except per common share amounts) Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year Cash flow from operations 247 19 81 60 100 260 89 117 100 91 397 Specific items1 49 7 — 2 3 12 1 5 6 12 24 Adjusted cash flow from operations2 296 26 81 62 103 272 90 122 1
Slide 18: New Capital Investments
NEW CAPITAL INVESTMENTS (in millions of Canadian dollars, excluding new leases, disposal of assets and accounts payable variation) 532 36 2024F CAPEX: ~ 41 $175 M1 29 312 330 26 289 27 50 32 81 227 213 37 35 169 39 22 426 25 175 20 24 85 104 61 217 197 184 22 22 18 62 66 84 2017 2018 2019 2020 2021
Slide 19: Net Debt Reconciliation - Q4 2023
NET DEBT1 RECONCILIATION - Q4 2023 (M CAN$) 2,200 2,088 2,100 2,000 1,900 (149) 47 1,882 24 15 1,800 (91) (45) (6) (1) 1,700 Net debt as of Changes in non- Cash flow F/X CAN$ Investments Proceeds from Dividends paid & Right-of-use Payments for Net debt as of September 30, cash from oper. and others
Slide 20: Net Debt Reconciliation - 2023
NET DEBT1 RECONCILIATION - 2023 (M CAN$) 1,966 2,000 350 1,882 85 1,500 50 (397) (113) (39) (13) (7) 1,000 Net debt as of Cash flow Changes in non- F/X CAN$ Investments Proceeds from Right-of-use Dividends paid & Payments for Net debt as of December 31, from oper. cash and others disposals of assets
Slide 21: Consolidated Financial Ratios & Debt Maturities
CONSOLIDATED FINANCIAL RATIOS & DEBT MATURITIES Net Debt / EBITDA (A)1,3 Interest Coverage Ratio2,3 5.2x 6.7x 4.7x 5.8x 6.0x 4.0x 3.8x 3.6x 3.5x 3.5x 3.4x 4.7x 4.6x 4.3x 4.6x 4.9x 4.5x 3.25x 3.4x 2.5x 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 22: Near Term Factors
NEAR TERM FACTORS • Containerboard: Sequential performance forecast to decrease, vs Q4 2023 vs Q1 2023 reflecting higher raw material and energy costs, lower average Q1 20241 selling price and lower production levels related to inventory management following softer Q4 demand. Year-over-year EBITDA (
Slide 23: Appendix
APPENDIX 23
Slide 24: Summary of Quarterly Financial Results & KPIs
SUMMARY OF QUARTERLY FINANCIAL RESULTS & KPIs 2021 2022 2023 (In millions of CAN$, except per common share amounts, where noted) Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year Financial Results Sales 3,956 1,038 1,119 1,174 1,135 4,466 1,134 1,168 1,198 1,138 4,638 Operating income (loss) 50 (4) 32 25 (20)
Slide 25: Year-over-Year Sales Reconciliation
YEAR-OVER-YEAR SALES RECONCILIATION +0% (M CAN$) 1,250 10 4 2 1,200 57 1,150 1,135 1,138 (70) 1,100 Recovery & Sales Recycling & Sales (M CAN$) Q4 2022 Volume Mix Other items F/X CAN$ Price Q4 2023 Containerboard 567 60 (7) — 1 (60) 561 Specialty Products 161 4 — — — (5) 160 Tissue Papers 384 (7) 17
Slide 26: Year-over-Year EBITDA (A) Reconciliation
YEAR-OVER-YEAR EBITDA (A)1 RECONCILIATION + Higher volume + Lower production costs (Closures) + Lower Corporate activities costs - Higher production costs raw material, logistics and + Higher results from Recovery + Lower operations energy costs - Lower selling prices - Lower selling prices - Higher
Slide 27: Sequential Sales Reconciliation
SEQUENTIAL SALES RECONCILIATION (M CAN$) -5% 1,300 34 11 1 1,198 1,200 (29) 1,138 1,100 (77) 1,000 Recovery & Sales Recycling & Sales (M CAN$) Q3 2023 Mix F/X CAN$ Other items Price Volume Q4 2023 Containerboard 593 18 6 — (18) (38) 561 Specialty Products 157 — 1 — (1) 3 160 Tissue Papers 422 16 4 —
Slide 28: Sequential EBITDA (A) Reconciliation
SEQUENTIAL EBITDA (A)1 RECONCILIATION + Lower production costs (Closures) - Lower selling prices Net negative impact from lower volume - Lower volume - Lower volume - more than offsetting a favourable mix + Lower operating costs Higher raw material and logistics - Lower selling price - - Higher logi
Slide 29: Cost of Sales, Selling and Administrative Expenses
COST OF SALES SELLING AND ADMINISTRATIVE EXPENSES (In millions of Canadian dollars) 2023 2022 Q4 2023 Q3 2023 Q4 2022 Cost of sales Raw materials 1,570 1,587 390 419 395 Wages and benefits 773 698 194 192 180 Energy 231 243 53 57 60 Delivery 540 577 139 135 137 Other 617 625 149 151 156 Depreciation
Slide 30: Selected Reference Prices
SELECTED REFERENCE PRICES Current Current Containerboard - Selected Products (US$/s.t.) Specialty Products - Selected Products (Feb-24) (US$/s.t.) (Feb-24) 1,000 1,200 1,100 900 865 1,000 1,020 800 900 755 800 700 700 600 600 Aug-21 Feb-20 May-23 Nov-21 May-20 Aug-23 Feb-22 Aug-20 Feb-19 Nov-23 May-
Slide 31: Selected Reference Prices and Fibre Costs
SELECTED REFERENCE PRICES AND FIBRE COSTS Q4 2023 vs. 2021 2022 2023 2023 vs 2022 Q3 2023 These indexes should only be used as an indicator of trends and they may be different than our actual selling prices or purchasing costs. Year Q1 Q2 Q3 Q4 Year Q1 Q2 Q3 Q4 Year (units) (%) (units) (%) Selling P
Slide 32: For more information
For more information: www.cascades.com/investors Jennifer Aitken, MBA Director, Investor Relations 514-282-2697 / investor@cascades.com