Mercer International Inc. (MERC) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning and welcome to Mercer International's second quarter 2025 earnings conference call. On the call today is Juan Carlos Bueno, Mercer's President and Chief Executive Officer, and Richard Short, Mercer's Chief Financial Officer and Secretary. I will now hand the call over to Richard. Thank you Michelle and good morning everyone. Thanks for joining us today. I will begin by touching on the financial and operating highlights of the second quarter before turning the call over to Juan Carlos to provide further color into the markets, our operations and our strategic initiatives. Also for those of you that have joined today's call by telephone, there is presentation material that we have attached to the investor section of our website. But before turning to our results, I would like to remind you that we will make forward looking statements in this morning's conference call. According to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, I would like to call your attention to the risks related to these statements, which are more fully described in our press release and in the company's filings with the Securities and Exchange Commission. This quarter our EBITDA was negative $21 million, a significant decrease from Q1's positive EBITDA of $47 million. The key drivers of the lower results included a negative foreign exchange impact from a weaker dollar, primarily on our euro and Canadian dollar denominated costs and expenses, which reduced EBITDA by approximately $26 million relative to Q1. Lower pulp prices in China negatively impacted EBITDA by roughly $8 million and led to a non-cash hardwood inventory impairment of $11 million. We also incurred higher fiber costs for both our pulp and solid wood segments. Our pulp segment had ne...