Rayonier Advanced Materials Inc. · NYSE:RYAM
Rayonier Advanced Materials — Q1 2019 Earnings Presentation
20 slides from Rayonier Advanced Materials's earnings presentation, May 9, 2019
Slide 1: First Quarter 2019 Financial Presentation Materials
First 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: Q1'19 Consolidated Financial Highlights
Q1’19 Consolidated Financial Highlights Q1 Revenue: $483 million Q1 Operating Loss: $18 million; Adjusted EBITDA: $20 million Revenue* — Results significantly impacted by: 14% ▪ Unplanned downtime in Temiscaming lost 25 days of commodity viscose production costing $10 million 14% ▪ Wood costs an
Slide 5: High Purity Cellulose – Results & Outlook
High Purity Cellulose – Results & Outlook Quarter Ended Q1 2019 Results: Mar 30, Dec 31, Mar 31 Sales increased $4 million from Q1’18 driven by higher 2019 2018 2018 commodity volumes and a 5% increase in commodity Key Financials (in millions) prices partially offset by CS price and volume decline
Slide 6: Forest Products – Results & Outlook
Forest Products – Results & Outlook Quarter Ended Q1 2019 Results: Mar 30, Dec 31, Mar 31, Sales decreased $24 million from prior year driven by a 2019 2018 2018 19% decline in lumber prices and 10% decline in volumes Key Financials (in millions) Adjusted EBITDA decreased $15 million primarily f
Slide 7: Pulp – Results & Outlook
Pulp – Results & Outlook Quarter Ended Q1 2019 Results: Sales decreased $15 million from prior year driven by a Mar 30, Dec 31, Mar 31, 10% decline in prices and 11% decline in volume due to 2019 2018 2018 market downtime Key Financials (in millions) Adjusted EBITDA decreased $12 million primari
Slide 8: Paper – Results & Outlook
Paper – Results & Outlook Quarter Ended Q1 2019 Results: Mar 30, Dec 31, Mar 31, Sales decreased $6 million from prior year driven by: 2019 2018 2018 — 27% decline in newsprint volumes and 5% decline in Key Financials (in millions) paperboard price, Net Sales $ 70 $ 72 $ 76 — Partially offset by 1
Slide 9: Financial Highlights
Financial Highlights • 7% decrease in sales driven by: (in $ millions) Quarter Ended — 7% decline in CS price Q1'19 Q1'18 — 10% decline in high-yield pulp prices Sales $ 483 $ 522 — 19% decline in lumber prices — 27% decline in newsprint Operating Income (Loss) (18) 46 volumes Partially offset by: N
Slide 10: Capital Resources & Allocation
Capital Resources & Allocation Quarter Ended ($ Millions) March 30, 2019 March 31, 2018 Cash Provided by (Used for) Operating Activities $ (27) $ 33 Cash Used for Investing Activities (31) (29) Cash Provided by Financing Activities 18 (12) Change in Cash Balances $ (40) $ (8) Adjusted Free Cash Flow
Slide 11: Disciplined Capital Allocation
Disciplined Capital Allocation Cash Flow From Operations Maintain Assets $100-110 million of annual capex Adjusted Free Cash Flow Reduce Leverage Target 2.5x Net Leverage Value Driven Approach Focused on Risk Adjusted Returns on Invested Capital Investment in the External Strategic Return of Capital
Slide 12: Strategy to Drive Growth & Shareholder Value
Strategy to Drive Growth & Shareholder Value Launch new “Go-to-Market” strategy designed to: Go-to-Market • Improved Cellulose Specialties price and margin Strategy • Realign assets to market needs and sales mix Achieve long-term • Drive long-term High Purity EBITDA growth EBITDA growth in High Puri
Slide 13: Appendix
RAYONIER Advanced Materials. Appendix
Slide 14: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures EBITDA is defined as earnings before interest, taxes, depreciation and amortization. EBITDA is a non-GAAP measure used by our Chief Operating Decision Maker, existing stockholders and potential stockholders to measure how the Company is performing relative to the ass
Slide 15: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) Forest High Purity Corporate Three Months Ended Products Pulp Paper Cellulose & Other Total March 30, 2019 Net Income (Loss) $ (5) $ 11 $ 1 $ (4) $ (25) $ (22) Depreciation and amortization 2 1 4 29 — 36 Interest expense, net — — — — 15 15 Income tax
Slide 16: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) March 30, 2019 December 31, 2018 Adjusted Net Debt Reconciliation Current maturities of long-term debt $ 15 $ 15 Long-term debt & capital lease obligation 1,208 1,173 Total debt $ 1,223 $ 1,188 Original issue discount, premiums and debt issuance costs
Slide 17: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) March 30, 2019 March 31, 2018 Adjusted Free Cash Flows: Cash provided by (used for) operating activities (27) 33 Capital expenditures (27) (20) Adjusted Free Cash Flows $ (54) $ 13 17
Slide 18: Reconciliation of Reported to Adjusted Earnings
Reconciliation of Reported to Adjusted Earnings ($ Millions, except per share amounts) Three Months Ended December 31, March 30, 2019 2018 March 31, 2018 Per Per Per Diluted Diluted Diluted Adjusted Net Income (Loss) (a): $ Share $ Share $ Share Net Income (Loss) $ (22) $ (0.52) $ 13 $ 0.18 $ 24 $ 0
Slide 19: Average Sales Price & Volume
Average Sales Price & Volume Q1'19 Q4'18 Q1'18 High Purity Cellulose Cellulose Specialties Price ($ per metric ton) 1,284 1,303 1,375 Volume (metric tons) 150 158 152 Commodity Products Price ($ per metric ton) 847 827 803 Volume (metric tons) 87 109 53 Forest Products Lumber Price ($ per thousand b
Slide 20: Key Production & Pricing
Key Production & Pricing Q1’19 Q4’18 Q1’18 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 • $1,332 • $1,363 • $1,223 Commodity • Viscose Pulp delivered to China • $890 • $930 • $920 • 2x4 Ra
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