Slide 1: Third Quarter 2019 Financial Presentation Materials
Third Quarter 2019 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 performa
Slide 3: 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 net income and adjusted net debt. These non-GAAP measures are reconciled to each of their respective
Slide 4: Q3'19 Consolidated Financial Highlights
Q3’19 Consolidated Financial Highlights Revenue of $416 million with Adjusted EBITDA of $35 million Revenue* Improved Adjusted EBITDA in High Purity Cellulose from 15% prior quarter 6% — Improved productivity and reduced costs offset by lower CS $416 million volume and weaker commodity viscose a
Slide 5: High Purity Cellulose – Results & Outlook
High Purity Cellulose – Results & Outlook Quarter Ended Q3 2019 Results: Sep 28, Jun 29, Sep 29, Sales decreased $40 million from Q3’18 driven by 2019 2019 2018 a 16% decline in CS volumes due to weaker Key Financials ($ millions) markets and strong 2018 shipments, a 1% impact Net Sales $ 268 $ 26
Slide 6: Forest Products – Results & Outlook
Forest Products – Results & Outlook Quarter Ended Q3 2019 Results: Sep 28, Jun 29, Sep 29, Sales decreased $21 million from Q3’18 driven by 2019 2019 2018 25% decline in sale price for lumber and 5% lower Key Financials ($ millions) volumes due to curtailments in the quarter Net Sales $ 65 $ 81 $
Slide 7: Pulp – Results & Outlook
Pulp – Results & Outlook Quarter Ended* Q3 2019 Results: Sep 28, Jun 29, Sep 29, Sales decreased $20 million from Q3’18 driven by 2019 2019 2018 32% decline in pulp sales price and 24% lower Key Financials ($ millions) volumes due to weak demand Net Sales $ 26 $ 40 $ 46 Adjusted EBITDA decreased
Slide 8: Paper – Results & Outlook
Paper – Results & Outlook Quarter Ended Q3 2019 Results: Sep 28, Jun 29, Sep 29, Sales decreased $4 million from Q3’18 driven 2019 2019 2018 primarily by 16% decline in newsprint pricing and Key Financials ($ millions) 14% lower newsprint volumes due to lower Net Sales $ 74 $ 74 $ 78 production an
Slide 9: Consolidated Operating Income
Consolidated Operating Income ($ Millions) Bridge Q3’18 to Q3’19 60 40 $43 (39) 20 0 $(8) (33) 14 (20) 7 (40) Q3 2018 Sales Price Sales Volume / Mix Cost SG&A and Other Q3 2019 / Other Sales price for commodity products remain key driver for declines from prior years Volumes impacted by weaker C
Slide 10: Financial Highlights
Financial Highlights Three Months Ended Nine Months Ended ($ Millions) Sep 28, Sep 29, Sep 28, Sep 29, 2019 2018 2019 2018 Sales primarily impacted by lower Sales $ 416 $ 501 $ 1,307 $ 1,476 commodity prices and volumes Operating Income (Loss) (8) 43 (51) 131 Net Income (Loss) from Adjusted EBIT
Slide 11: Amendment
Amendment Allows the Company to manage through difficult commodity markets & emerge stronger and more resilient Provides Requires Financial flexibility & operational runway to Increased interest rate, based on grid manage through challenging markets via with ability to decrease as leverage rel
Slide 12: Strategic Update
Strategic Update • Executing on Cellulose Specialties Go-to-Market strategy with focus on improving Go-to-Market margins; Price increase announced in October Strategy • Assets realignment progressing to match market needs and sales mix • Remain on track to capture $155 million of benefits from Four
Slide 13: Appendix
RAYONIER Advanced Materials. Appendix
Slide 14: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures EBITDA is defined as income (loss) from continuing operations before interest, taxes, depreciation and amortization. EBITDA is a non-GAAP measure used by our Chief Operating Decision Maker, existing stockholders and potential stockholders to measure how the Company i
Slide 15: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) Forest High Purity Corporate Three Months Ended Products Pulp* Paper Cellulose & Other Total September 28, 2019 Income (Loss) from Continuing Operations $ (5) $ (2) $ 3 $ 8 $ (18) $ (14) Depreciation and amortization 2 1 4 33 — 40 Interest expense, ne
Slide 16: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) Forest High Purity Corporate Nine Months Ended Products Pulp* Paper Cellulose & Other Total September 28, 2019 Income (Loss) from Continuing Operations $ (27) $ 3 $ 8 $ 10 $ (56) $ (62) Depreciation and amortization 7 2 13 90 — 112 Interest expense, n
Slide 17: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) September 28, 2019 December 31, 2018 Adjusted Net Debt Reconciliation Current maturities of long-term debt $ 21 $ 15 Long-term debt & finance lease obligation 1,212 1,173 Total debt $ 1,233 $ 1,188 Original issue discount, premiums and debt issuance c
Slide 18: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) September 28, September 29, 2019 2018 Adjusted Free Cash Flows: Cash provided by operating activities of continuing operations 5 141 Capital expenditures (63) (58) Adjusted Free Cash Flows $ (58) $ 83 18
Slide 19: Reconciliation of Reported to Adjusted Earnings
Reconciliation of Reported to Adjusted Earnings ($ Millions, except per share amounts) Three Months Ended Nine Months Ended September 28, June 29, September 29, September 28, September 29, 2019 2019 2018 2019 2018 Adjusted Operating Income (Loss) Per Per Per Per Per and Income (Loss) from Continuing
Slide 20: Average Sales Price & Volume
Average Sales Price & Volume Three Months Ended Nine Months Ended Sep 28, Jun 29, Sep 29, Sep 28, Sep 29, 2019 2019 2018 2019 2018 High Purity Cellulose Cellulose Specialties Price ($ per metric ton) $ 1,317 $ 1,310 $ 1,333 $ 1,303 $ 1,344 Volume (metric tons) 137 146 163 432 466 Commodity Products
Slide 21: Key Index Pricing
Key Index Pricing Q3’18 Q2’19 Q3’19 Average Average Average Product Index* Index Price Index Price Index Price Cellulose • None • N/A • N/A • N/A Specialties High Purity • Bleached Kraft Fluff • $1,328 • $1,260 • $1,163 Commodity • Viscose Pulp delivered to China • $930 • $845 • $745 • 2x4 Random Le