Slide 1: Second Quarter 2017 Financial Presentation Materials
Second Quarter 2017 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 free cash flows, pro forma operating income, pro forma net income and adjusted net debt. These non-GAAP measures are reconciled to each of their respective most directly c
Slide 4: Financial Highlights
Financial Highlights ($ Millions) Quarter Ended Six Months Ended 2Q 2017 2Q 2016 2Q 2017 2Q 2016 Sales $ 201 $ 214 $ 403 $ 431 Operating Income 13 39 39 70 Pro Forma Operating Income1 21 39 47 70 Net Income 5 19 14 40 Pro Forma Net Income1 9 19 18 34 EBITDA1 36 58 84 121 Pro Forma EBITDA1 42 58 90 1
Slide 5: Operating Income - Variance Analysis
Operating Income - Variance Analysis ($ Millions) (8) (3) (5) Pro Forma Operating Income (2) Adjustments1 39 8 million Pro Forma Adjustments Operating Income Operating13 Income Operating Income 291 (14) Pro Forma Adjustments (6) Pro Forma 1 (4) Adjustments1 Operating Income 0 Operating Income Operat
Slide 6: Selected Financial and Operating Information
Selected Financial and Operating Information Three Months Ended Six Months Ended June 24, 2017 June 25, 2016 June 24, 2017 June 25, 2016 Sales Volume, thousands of metric tons Cellulose specialties 110 113 217 219 Commodity products 54 55 113 130 Total 164 168 330 349 Average Sales Price, $ per metr
Slide 7: 4 Year Total Cost Improvement
Cost Improvement Initiatives ($ Millions) 25 4 Year Total Cost Improvement 30 $125M - $140M 50 35 $100 million in Cost Improvements achieved since 2014 * Breakdown of expected future cost savings on a run-rate basis included for illustrative purposes. To be refined in future periods to reflect actua
Slide 8: 2017 Guidance
2017 Guidance ⦁ Cellulose specialties (“CS”) prices 3% to 4% below 2016 average prices primarily due to lower acetate mix and pricing ⦁ CS volumes flat to slightly down compared to 2016 due to the timing of revenue recognition ⦁ Commodity sales volumes higher (depending on viscose/absorbent material
Slide 9: Capital Resources & Liquidity
Capital Resources & Liquidity ($ Millions) Six Months Ended June 24, 2017 June 25, 2016 Cash Provided by Operating Activities $ 87 $ 151 Cash Used for Investing Activities (32) (36) Cash Used for Financing Activities (12) (50) Adjusted Free Cash Flows* 56 113 Debt Principal Payments $ 790 $ 812 Cash
Slide 10: Combination Drives Successful Earnings Growth
Combination Drives Successful Earnings Growth ⦁ Enhanced scale drives ability to execute growth strategy ⦁ Superior capabilities in high purity cellulose ⦁ Diversified paper and forest products profile ⦁ Expansion of cost transformation initiative ⦁ Significant high return capital project opportunit
Slide 11: Acquisition of Tembec Process
Acquisition of Tembec Process Tembec Shareholder Vote Canadian Court Ratifies Vote - August 7 Antitrust Clearance United States Germany Canada China Investment Canada Compliance Closing expected in Q4 2017 11
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 ($ Millions) Six Months Ended June 24, 2017 June 25, 2016 EBITDA Reconciliation Net Income $ 14 $ 40 Depreciation and amortization 43 42 Interest expense, net 17 17 Income tax expense 10 22 EBITDA $ 84 $ 121 Acquisition related costs 8 Unrealized gain on derivativ
Slide 15: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ Millions) June 24, 2017 June 25, 2016 Adjusted Net Debt Reconciliation Current maturities of long-term debt $ 13 $ 8 Long-term debt & capital lease obligation 769 795 Total debt $ 782 $ 803 Original issue discount and debt issuance costs 8 9 Cash and cash equiv
Slide 16: Reconciliation of Reported to Pro Forma Earnings
Reconciliation of Reported to Pro Forma Earnings ($ Millions, except per share amounts) Three Months Ended Six Months Ended June 24, 2017 March 25, 2017 June 25, 2016 June 24, 2017 June 25, 2016 Per Per Per Per Per Pro Forma Operating and Diluted Diluted Diluted Diluted Diluted Net Income (a): $ Sha
Slide 17: Reconciliation of Guided Non-GAAP Measures
Reconciliation of Guided Non-GAAP Measures ($ Millions, except per share amounts) Minimum Maximum 2017 Net Income Guidance $ 32 $ 39 Income tax expense 20 23 Acquisition related costs 12 12 Interest expense, net 37 37 Depreciation and amortization 89 89 2017 Pro Forma EBITDA Guidance $ 190 $ 200 Min
Slide 18: Debt Maturity Schedule
Debt Maturity Schedule Millions 4 251 29 506 240 509 8 11 19 3 18