Rayonier Advanced Materials Inc. · NYSE:RYAM
Rayonier Advanced Materials — Q1 2024 Earnings Presentation
26 slides from Rayonier Advanced Materials's earnings presentation, May 8, 2024
Slide 1: First Quarter 2024 Financial Presentation Materials
First Quarter 2024 Financial Presentation Materials May 8, 2024
Slide 2: Safe Harbor
Safe Harbor Forward-Looking Statements 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 RYAM’s future events, developments, or financial or operational pe
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This earnings release and the accompanying schedules contain certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, adjusted free cash flows, adjusted income from continuing operations, adjusted net debt, and net secured debt. The Company believes these n
Slide 4: Q1'24 Financial Highlights
Q1’24 Financial Highlights Revenue by Segment/Product ⎔ Revenue of $388 million; -$79 million from Q1’23 ⎔ Operating Income of $17 million; flat versus Q1’23 Paperboard ⎔ Adjusted Free Cash Flow of -$16 million; -$52 million from Q1’23 14% ⎔ Adjusted EBITDA of $52 million; +$1 million from Q1’23 – H
Slide 5: High Purity Cellulose
High Purity Cellulose Operating Income Bridge Quarter Ended Key Financials Mar 30, Dec 31, Apr 1, 2024 2023 2023 $ millions Net Sales $307 $347 $374 Operating Income 21 (49) 13 (1) Adjusted EBITDA 50 45 44 ⎔ Cellulose specialties price increase of 2% was more than offset by an 11% decrease in commod
Slide 6: Paperboard
Paperboard Operating Income Bridge Quarter Ended Key Financials Mar 30, Dec 31, Apr 1, 2024 2023 2023 $ millions Net Sales $53 $55 $59 Operating Income 8 8 10 Adjusted EBITDA 12 12 13 Paperboard - Volume and Price ⎔ Sales prices decreased 12% compared to Q1’23, mainly due to market-driven demand dec
Slide 7: High-Yield Pulp
High-Yield Pulp Operating Income Bridge Quarter Ended Key Financials Mar 30, Dec 31, Apr 1, 2024 2023 2023 $ millions Net Sales $34 $25 $42 Operating Income (1) (5) 7 Adjusted EBITDA - (5) 8 ⎔ Sales prices declined 27% compared to Q1’23, High-Yield Pulp - Volume and Price mainly due to market condit
Slide 8: Consolidated Operating Income
Consolidated Operating Income BRIDGE Q1’23 TO Q1’24 ⎔ Higher sales prices in cellulose specialties were more than offset by pricing declines across other products ⎔ Increases in Paperboard and High-Yield Pulp sales volumes were more than offset by declines in High Purity Cellulose, tied to the inven
Slide 9: Capital Structure & Liquidity
Total Liquidity Capital Structure & Liquidity $55 ⎔ Adjusted Net Debt of $743 million Cash – Gross debt of $798 million; $54 million decrease $199 Factoring (France) from Q1’23 Million ABL (North America) $13 $131 – Net Secured debt of $721 million ⎔ $199 million of liquidity, including $55 million
Slide 10: 2024 Initiatives
2024 Initiatives ⎔ Opportunistically refinance Senior Notes ⎔ Asset optimization maturing in January 2026 before going current – Reduce commodity exposure and earnings volatility, and – Continued focus on deleveraging through targeted debt operate assets only when market conditions support reduction
Slide 11: Suspension of Temiscaming HPC Plant
Suspension of Temiscaming HPC Plant ⎔ Announced the indefinite suspension of operations at the Temiscaming HPC plant ⎔ Expecting a modest Adjusted EBITDA Benefit in 2024 – Mitigation of operating loss partially offset by stranded and transactional costs – Non-cash charges related to impairment expec
Slide 12: 2024 Guidance
2024 Guidance ADJUSTED FREE CASH FLOW GUIDANCE OF $80-100 MILLION INCLUDING PASSIVE ASSET SALE ($ Millions) $180-200 Capital allocation decision to repay debt or invest in high return strategic capital projects (1) 85 $80-100 14 6 45 10 17 39 80 (2) (1) Higher due to the timing of interest payments
Slide 13: Market Outlook
Market Outlook High Purity Cellulose ⎔ 2024 cellulose specialties price increase of a low single-digit percentage versus 2023 prices as the Company prioritizes value over volume ⎔ Cellulose specialties sales volumes to be comparable to 2023 with increased Other CS volumes and a modest increase in et
Slide 14: Net Debt/Adjusted EBITDA
Reducing Net Leverage via EBITDA Growth & Debt Reduction 12.5x 16% 16.0% 14% 14.0% 10.0x 10.0x 12% 12.0% Net Debt/Adjusted EBITDA 10.3% 11% 10.0% EBITDA Margin 7.5x 9.0% 8.9% 8.5% 7.4% 8.0% 5.4x 5.3x 5.2x 5.0x 6.0% 4.0x $1,095 4.4x ~ 3.3x 4.2x $937 4.0% $859 < 2.5x ~3.0x 2.5x $797 $798 (1) $727 2.0%
Slide 15: Appendix
Appendix
Slide 16: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures EBITDA Net income (loss) before interest, taxes, depreciation and amortization. EBITDA is a non-GAAP measure used by our Management, existing stockholders and potential stockholders to measure how the Company is performing relative to the assets under management. Adj
Slide 17: Net Sales and Operating Income by Segment
Net Sales and Operating Income by Segment ($ MILLIONS) 17
Slide 18: Consolidated Statements of Operations
Consolidated Statements of Operations ($ MILLIONS) 18
Slide 19: Consolidated Balance Sheets
Consolidated Balance Sheets ($ MILLIONS) 19
Slide 20: Reconciliation of EBITDA by Segment
Reconciliation of EBITDA by Segment ($ MILLIONS) 20
Slide 21: Reconciliation of EBITDA Guidance
Reconciliation of EBITDA Guidance ($ MILLIONS) 21
Slide 22: Reconciliation of Adjusted Free Cash Flow
Reconciliation of Adjusted Free Cash Flow ($ MILLIONS) 22
Slide 23: Reconciliation of Adjusted Free Cash Flow Guidance
Reconciliation of Adjusted Free Cash Flow Guidance ($ MILLIONS) 23
Slide 24: Reconciliation of Adjusted Net Secured Debt
Reconciliation of Adjusted Net Secured Debt ($ MILLIONS) 24
Slide 25: Reconciliation of Adjusted Income from Continuing Operations
Reconciliation of Adjusted Income from Continuing Operations ($ MILLIONS) 25
Slide 26: Commodity Prices Mixed
Commodity Prices Mixed Viscose Delivered to China Fluff Delivered to North America 1,300 1,130 1,170 2,800 2,230 2,208 2,138 970 2,070 1,977 1,100 905 905 2,300 1,833 PRICE ($ / MT) PRICE ($ / MT) 900 850 890 1,747 1,755 900 1,800 700 1,300 500 800 300 300 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
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