Slide 1: Fourth Quarter 2014 Financial Presentation Materials
Fourth Quarter 2014 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 performan
Slide 3: Financial Highlights
Financial Highlights ($ Millions – Except EPS) Quarter Ended Full Year Profitability 4Q 2014 3Q 2014 4Q 2013 2014 2013 Sales $ 248 $ 254 $ 282 $ 958 $ 1,047 Operating income (28) 42 70 63 289 Pro forma operating income* 47 46 73 181 295 Net (loss) income (23) 19 51 32 220 Pro forma net income* 26 22
Slide 4: Pro Forma Operating Income 3Q 2014 to 4Q 2014
Pro Forma Operating Income 3Q 2014 to 4Q 2014 ($ Millions) $55 $50 (3) 3 1 $45 $40 46 47 $35 $30 $25 3Q 2014 Price Volume / Costs 4Q 2014 Sales Mix Price variance is calculated for all products. Volume variance is calculated on a contribution margin basis. 4
Slide 5: Pro Forma Operating Income 4Q 2013 to 4Q 2014
Pro Forma Operating Income 4Q 2013 to 4Q 2014 ($ Millions) $85 (24) $75 $65 $55 (4) 73 2 $45 $35 47 $25 4Q 2013 Price Volume / Costs 4Q 2014 Sales Mix Price variance is calculated for all products. Volume variance is calculated on a contribution margin basis. 5
Slide 6: Pro Forma Operating Income 2013 to 2014
Pro Forma Operating Income 2013 to 2014 ($ Millions) $350 (73) $300 $250 (12) (29) $200 295 $150 181 $100 2013 Price Volume / Costs 2014 Sales Mix Price variance is calculated for all products. Volume variance is calculated on a contribution margin basis. 6
Slide 7: Capital Resources and Liquidity
Capital Resources and Liquidity ($ Millions) Years Ended December 31, 2014 2013 Cash Provided by Operating Activities $ 188 $ 258 Cash Used for Investing Activities (90) (251) Cash Used for Financing Activities (31) (7) EBITDA* 149 363 Pro forma EBITDA* 267 369 Segment EBITDA* 291 386 Adjusted Free
Slide 8: 2015 Full Year Guidance
2015 Full Year Guidance ‒ CS volumes comparable with 2014 / 2013 levels ‒ CS Prices 7‐8% below 2014 average prices ‒ Commodity sales volumes higher than 2014 ‒ Estimated EBITDA of $200 ‐ $220 million 8
Slide 9: 2014 Pro Forma vs. 2015 Estimated EBITDA
2014 Pro Forma vs. 2015 Estimated EBITDA Millions $300 $275 $250 $70 $225 ~$267 $200 ~$20‐$40* ~$200‐ $25 $220* $175 $10 $150 2014 Pro Forma Price Cost Inflation Production Days Cost Initiatives 2015 Estimated EBITDA EBITDA *Value range dependent on timing of achieving initiatives. 9
Slide 10: Capital Allocation Strategies for 2015
Capital Allocation Strategies for 2015 • Reduce debt / increase financial flexibility • Invest in our business • Fund modest dividend 10
Slide 11: 2015 Focus and Initiatives
2015 Focus and Initiatives • Reduce costs and enhance profitability • Efficient and reliable operations • Discipline of continuous improvement • Focus on working capital • Asset optimization • Review and match assets to market conditions • Drive incremental sales and profits from our assets, specifi
Slide 12: Appendix
RAYONIER ) Advanced Materials. Appendix
Slide 13: 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 14: Reconciliation of Non-GAAP Measures
Reconciliation of Non‐GAAP Measures Years Ended December 31, 2014 2013 EBITDA Reconciliation Net Income $ 32 $ 220 Depreciation & amortization 86 74 Interest, net 22 ‐ Income tax expense 9 69 EBITDA $ 149 $ 363 One‐time separation and legal costs 44 6 Environmental reserve and impairment adjustments
Slide 15: Reconciliation of Reported to Pro Forma Earnings
Reconciliation of Reported to Pro Forma Earnings ($ Millions, except per share amounts) Three Months Ended December 31, 2014 September 27, 2014 December 31, 2013 $ EPS $ EPS $ EPS Operating (loss) income $ (28) $ 42 $ 70 One‐time separation and legal costs 2 3 3 Environmental reserve amd impairment
Slide 16: Selected Financial and Operating Information
Selected Financial and Operating Information Three Months Ended Years Ended December 31, September 27, December 31, December 31, 2014 2014 2013 2014 2013 Sales Volume, thousands of metric tons Cellulose specialties 123 129 128 479 486 Commodity products 46 39 40 148 156 Total 169 168 168 627 642 Sal
Slide 17: Debt Maturity Schedule
Debt Maturity Schedule Millions $1,000 $900 $800 289 $700 274 $600 107 $500 $400 Principal Repayments of Term Loans $300 550 550 $200 $100 3* 8 9 10 11 81 $‐ Total 2015 2016 2017 2018 2019 Thereafter Senior Notes 5.5% Term A‐1 Loan Facility Term A‐2 Loan Facility Revolver ($250m Line of Credit) * $3
Slide 18: Environmental Liabilities
Environmental Liabilities Activity (in millions) September 27, Increase December 31, 2014 (Reduction) to 2014 Liability Expenditures Liabilities Liability Augusta, Georgia $ 17.8 $ (0.4) $ 4.8 $ 22.2 Spartanburg, South Carolina 15.6 (0.3) 3.7 19.0 East Point, Georgia 13.3 (0.2) 2.5 15.6 Baldwin, Flo