Clearwater Paper Corporation (NYSE:CLW), a premier
supplier of quality consumer tissue and bleached paperboard today
reported financial results for the fourth quarter and year ended
December 31, 2023.
2023 FOURTH QUARTER HIGHLIGHTS
- Strong performance driven by solid operational results and
continued strength in tissue
- Natural gas disruption impacted Lewiston mill operations in
November
- Net income of $18 million, or $1.04 per diluted share and
Adjusted EBITDA of $63 million
- Net sales of $513 million, down 3% compared to the fourth
quarter of 2022
- Reduced net debt by $32 million, repurchased $3 million of
outstanding shares, with $7 million remaining under program
2023 FULL YEAR HIGHLIGHTS
- Outstanding year driven by performance improvement in
tissue
- Net income of $108 million, or $6.30 per diluted share and
Adjusted EBITDA of $281 million, up $54 million versus 2022
- Net sales of $2.1 billion, flat compared with 2022, strong
tissue demand offset softness in paperboard
- Net debt reduction of $89 million, more than $450 million since
2020; completed refinancing of 2014 Notes
- Repurchased $18 million of outstanding shares
STRATEGIC UPDATES
Clearwater Paper announced today that it has signed a definitive
agreement to acquire from Graphic Packaging its Augusta, Georgia
bleached paperboard manufacturing facility for $700 million,
subject to customary adjustments. The facility is a well-invested
site with approximately 600 thousand tons of bleached paperboard
annual capacity. Clearwater Paper expects this acquisition to
contribute $140-150 million1 in Adjusted EBITDA annually by the end
of 2026, including through volume and cost synergies. The
transaction is subject to regulatory approvals and other customary
conditions and is currently expected to close in the second quarter
of 2024.
“After a thorough strategic review, we’ve determined that the
Augusta acquisition will be a great fit for Clearwater Paper, as it
will add scale and growth capacity to improve our position as a
premier, independent supplier of paperboard to North American
converters,” said Arsen Kitch, president and chief executive
officer. “We remain optimistic about the long-term prospects for
paperboard as consumers look for sustainable solutions in packaging
and food service. With this acquisition, Clearwater Paper will be
well positioned to service customers with high quality paperboard
capacity and a great manufacturing footprint across North America,”
concluded Kitch.
The company will explore strategic options for its tissue
business as it intends to focus on growth in paperboard.
1
As there is uncertainty in connection with
calculating the adjustments necessary to prepare reconciliations
from Adjusted EBITDA to the comparable GAAP financial measure, the
Company is unable to reconcile the Adjusted EBITDA projections
without unreasonable efforts. Therefore, no reconciliation is being
provided at this time. These items could result in significant
adjustments from the most comparable GAAP measure.
FOURTH QUARTER AND FULL YEAR RESULTS
“We had a great year, driven by a significant improvement in our
tissue margins and strong operational execution across both
businesses. Tissue demand remained strong, and we benefited from
favorable input costs. Paperboard demand was soft, but our team did
a great job of balancing supply with demand to manage inventories,"
said Arsen Kitch, president and chief executive officer. “We
maintained our focus on cash flow generation, and have reduced our
net debt by more than $450 million since 2020.”
For the fourth quarter of 2023, Clearwater Paper reported net
sales of $513 million, a 3% decrease compared to net sales of $527
million reported in the fourth quarter of 2022. Net income for the
fourth quarter of 2023 was $18 million, or $1.04 per diluted share,
compared to a net loss in the fourth quarter of 2022 of $6 million,
or $0.34 per diluted share. On a non-GAAP basis, Clearwater Paper
reported adjusted net income in the fourth quarter of 2023 of $23
million, or $1.35 per diluted share, compared to fourth quarter
2022 adjusted net loss of $5 million, or $0.30 per diluted share.
Adjusted EBITDA for the quarter was $63 million compared to the
fourth quarter of 2022 Adjusted EBITDA of $28 million.
For the full year 2023, Clearwater Paper reported net sales of
$2.1 billion, flat as compared to net sales of $2.1 billion for
2022. Net income for the full year was $108 million or $6.30 per
diluted share, compared to net income for 2022 of $46 million or
$2.68 per diluted share. On a non-GAAP basis, Clearwater Paper
reported adjusted net income for 2023 of $114 million, or $6.69 per
diluted share, compared to 2022 adjusted net income of $62 million,
or $3.63 per diluted share. Adjusted EBITDA for 2023 was $281
million, compared to 2022 Adjusted EBITDA of $227 million.
Pulp and Paperboard Segment
Net sales in the Pulp and Paperboard segment were $251 million
for the fourth quarter of 2023, down 8% compared to fourth quarter
2022 net sales of $274 million. Segment operating income for the
fourth quarter of 2023 was $27 million compared to $18 million for
the fourth quarter of 2022. Adjusted EBITDA for the segment was $37
million in the fourth quarter of 2023, compared to $27 million in
the fourth quarter of 2022. The increase in operating income and
Adjusted EBITDA was driven by the absence of planned major
maintenance at our Lewiston, Idaho facility and a weather event at
our Cypress Bend, Arkansas facility that occurred in the fourth
quarter of 2022, offset by lower sales prices.
Net sales in the Pulp and Paperboard segment were $1.1 billion
for 2023, a decrease of 6% compared to 2022 net sales of $1.1
billion. Segment operating income for 2023 was $169 million
compared to $183 million for 2022. Adjusted EBITDA for the segment
was $206 million for 2023, compared to $220 million for 2022. The
decrease in operating income and Adjusted EBITDA was driven by
lower sales volumes and planned production downtime to manage
inventory partially offset by lower input costs due to deflation
and absence of planned major maintenance.
Pulp and Paperboard Sales Volumes and Prices:
- Paperboard sales volumes were 188,018 tons in the fourth
quarter of 2023, a decrease of 1% compared to 188,999 tons in the
fourth quarter of 2022. Paperboard sales volumes were 751,520 tons
for the year ended 2023 compared to 814,556 tons for the year ended
2022.
- Paperboard average net selling price decreased 9% to $1,297 per
ton for the fourth quarter of 2023, compared to $1,429 per ton in
the fourth quarter of 2022. Paperboard average net selling price
increased 1% to $1,375 per ton for the year ended 2023, compared to
$1,356 per ton for the year ended 2022.
Consumer Products Segment
Net sales in the Consumer Products segment were $262 million for
the fourth quarter of 2023, up 3% compared to the fourth quarter
2022 net sales of $254 million. In the fourth quarter of 2023,
retail converted case shipments were 13.5 million cases, an
increase of 4% compared to the 13.0 million cases shipped in the
fourth quarter of 2022. Segment operating income for the fourth
quarter of 2023 was $31 million compared to operating income of $2
million in the fourth quarter of 2022. Adjusted EBITDA for the
segment was $46 million in the fourth quarter of 2023, up from $18
million in the fourth quarter of 2022. The increase in operating
income and Adjusted EBITDA was driven by higher sales prices, sales
volume and lower input costs, specifically pulp, energy and
freight, partially offset by higher chemical costs.
Net sales in the Consumer Products segment were $1.0 billion for
the full year 2023, up 8% compared to 2022 net sales of $950
million. For 2023, retail converted case shipments were 52 million
cases, a increase of 4% compared to 50 million cases shipped for
2022. Segment operating income for 2023 was $92 million, compared
to operating income of $11 million for 2022. Adjusted EBITDA for
the segment was $150 million for 2023, an increase from $74 million
for 2022. The increase in operating income and Adjusted EBITDA was
driven by higher sales prices and volume and lower input costs,
specifically freight.
Retail Tissue Sales Volumes and Prices:
- Retail tissue volumes sold were 81,475 tons in the fourth
quarter of 2023, an increase of 1% compared to 80,766 tons in the
fourth quarter of 2022. Retail tissue volumes sold were 317,582
tons for the year ended of 2023, an increase of 3% compared to
309,735 tons for 2022.
- Retail tissue average net selling prices increased 3% to $3,187
per ton in the fourth quarter of 2023, compared to $3,095 per ton
in the fourth quarter of 2022. Retail tissue average net selling
prices increased 6% to $3,200 per ton for 2023, compared to $3,010
per ton for 2022.
COMPANY OUTLOOK
“We anticipate continued strength in our tissue business in 2024
and believe that paperboard demand will recover in the second half
of the year. We also look forward to completing the Augusta
acquisition in the second quarter of this year and welcoming the
Augusta team to Clearwater Paper. Together we will be well
positioned to grow with our customers by offering outstanding
service, quality, and product innovation,” concluded Kitch.
Clearwater Paper Corporation will discuss these results during
an earnings conference call that begins at 2:00 p.m. Pacific Time
on Wednesday, February 21, 2024. A live webcast and accompanying
supplemental information will be available on the company's
website. A replay of the conference call will be available on the
website beginning at 5:00 p.m. Pacific Time the same day.
ABOUT CLEARWATER PAPER
Clearwater Paper is a premier supplier of private brand tissue
to major retailers, including grocery, club, mass merchants, and
discount stores. In addition, the company produces bleached
paperboard used by quality-conscious printers and packaging
converters, and offers services that include custom sheeting,
slitting, and cutting. Clearwater Paper's employees build
shareholder value by developing strong relationships through
quality and service.
USE OF NON-GAAP MEASURES
In this press release, the company presents certain non-GAAP
financial information for the fourth quarter and full year 2023 and
2022, including adjusted income and Adjusted EBITDA. Because these
amounts are not in accordance with GAAP, reconciliations to net
income as determined in accordance with GAAP are included in the
tables at the end of this press release. The company presents these
non-GAAP metrics because management believes they assist investors
and analysts in comparing the company's performance across
reporting periods on a consistent basis by excluding items that the
company does not believe are indicative of its core operating
performance. In addition, the company uses Adjusted EBITDA: (i) as
a factor in evaluating management’s performance when determining
incentive compensation, (ii) to evaluate the effectiveness of the
company's business strategies, and (iii) because the company's
credit agreement and the indentures governing the company's
outstanding notes use metrics similar to Adjusted EBITDA to measure
the company's compliance with certain covenants.
FORWARD-LOOKING STATEMENTS
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 as amended, including statements regarding: the proposed
transaction between Graphic Packaging and the company; the expected
timing and structure of the proposed transaction; the ability of
the parties to complete the proposed transaction considering the
various closing conditions; product demand; cost structure
improvements; the company’s expectations regarding the paperboard
and tissue markets; operational and financial performance; the
redemption of the company’s notes; the company’s financial
flexibility; the company’s continued investment in its business;
the company’s exploration and ability to take advantage of
strategic opportunities as they arise, and the company’s focus on
cash flow generation and inventory management. These
forward-looking statements are based on management’s current
expectations, estimates, assumptions and projections that are
subject to change. The company’s actual results of operations may
differ materially from those expressed or implied by the
forward-looking statements contained in this press release. Factors
that could cause or contribute to such material differences in
actual results include, but are not limited to: competitive pricing
pressures for the company’s products, including as a result of
capacity additions, demand reduction and the impact of foreign
currency fluctuations on the pricing of products globally; changes
in the U.S. and international economies and in general economic
conditions in the regions and industries in which we operate;
cyclical industry conditions; manufacturing or operating
disruptions, including equipment malfunctions and damage to the
company’s manufacturing facilities; the loss of, changes in prices
in regard to, or reduction in, orders from a significant customer;
changes in the cost and availability of wood fiber and wood pulp;
changes in energy, chemicals, packaging and transportation costs
and disruptions in transportation services impacting the company’s
ability to receive inputs or ship products to customers; reliance
on a limited number of third-party suppliers, vendors and service
providers required for the production of the company’s products and
the company’s operations; changes in customer product preferences
and competitors’ product offerings; labor disruptions;
cyber-security risks; larger competitors having operational,
financial and other advantages; consolidation and vertical
integration of converting operations in the paperboard industry;
the company’s ability to execute on the company’s growth and
expansion strategies; the company’s ability to successfully execute
capital projects and other activities to operate the company’s
assets, including effective maintenance, implement the company’s
operational efficiencies and realize higher throughput or lower
costs; IT system disruptions and IT system implementation failures;
changes in expenses, required contributions and potential
withdrawal costs associated with the company’s pension plans;
environmental liabilities or expenditures and climate change; the
company’s ability to attract, motivate, train and retain qualified
and key personnel; the company’s ability to service the company’s
debt obligations and restrictions on the company’s business from
debt covenants and terms; changes in the company’s banking
relations, or in the company’s customer supply chain financing;
negative changes in the company’s credit agency ratings; changes in
laws, regulations or industry standards affecting the company’s
business; and other risks and uncertainties described from time to
time in the company’s public filings with the Securities and
Exchange Commission, including its Annual Report on Form 10-K for
the year ended December 31, 2023. The forward-looking statements
are made as of the date of this press release and the company does
not undertake to update any forward-looking statements based on new
developments or changes in the company’s expectations after the
date of this press release.
Clearwater Paper
Corporation
Consolidated Statements of
Operations
(Unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
(In millions, except per share
data)
2023
2022
2023
2022
Net sales
$
512.8
$
526.7
$
2,082.8
$
2,080.1
Costs and expenses:
Cost of sales
437.4
491.4
1,752.0
1,823.4
Selling, general and administrative
expenses
36.8
33.5
148.3
133.0
Other operating charges, net
2.9
1.2
5.3
9.7
Total operating costs and expenses
477.2
526.1
1,905.7
1,966.2
Income from operations
35.7
0.6
177.1
113.9
Interest expense, net
(8.0
)
(7.3
)
(30.0
)
(34.6
)
Debt retirement costs
(3.1
)
—
(3.1
)
(0.5
)
Other non-operating expense (income)
(0.2
)
(1.4
)
0.1
(5.7
)
Total non-operating expense
(11.3
)
(8.8
)
(33.0
)
(40.9
)
Income (loss) before income
taxes
24.4
(8.2
)
144.2
73.1
Income tax provision (benefit)
6.8
(2.3
)
36.4
27.0
Net income (loss)
$
17.6
$
(5.9
)
$
107.7
$
46.0
Net income (loss) per common share:
Basic
$
1.06
$
(0.35
)
$
6.39
$
2.71
Diluted
1.04
(0.34
)
6.30
2.68
Average shares outstanding (in
thousands):
Basic
16,638
16,974
16,863
16,985
Diluted
16,867
17,204
17,091
17,181
Clearwater Paper
Corporation
Condensed Consolidated Balance
Sheets
(Unaudited)
(In millions)
December 31, 2023
December 31, 2022
Assets
Current assets:
Cash and cash equivalents
$
42.0
$
53.7
Receivables, net
184.5
188.8
Inventories, net
319.8
324.0
Other current assets
17.9
19.9
Total current assets
564.1
586.3
Property, plant and equipment, net
990.1
1,017.1
Other assets, net
117.6
100.1
Total Assets
$
1,671.8
$
1,703.5
Liabilities and Stockholders'
Equity
Current liabilities:
Current portion of long-term debt
$
0.8
$
0.9
Accounts payable and accrued
liabilities
285.1
311.1
Total current liabilities
286.0
312.0
Long-term debt
462.3
564.9
Liability for pension and other
postretirement employee benefits
55.7
58.2
Deferred tax liabilities and other
long-term obligations
199.1
196.4
Total Liabilities
1,003.0
1,131.5
Common Stock
—
—
Additional paid-in capital
14.9
28.5
Retained earnings
684.5
576.8
Accumulated other comprehensive loss, net
of tax
(30.7
)
(33.3
)
Total Stockholders' Equity
668.8
572.1
Total Liabilities and Stockholders'
Equity
$
1,671.8
$
1,703.5
Clearwater Paper
Corporation
Consolidated Statements of
Cash Flows
(Unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
(In millions)
2023
2022
2023
2022
Operating Activities
Net income (loss)
$
17.6
$
(5.9
)
$
107.7
$
46.0
Adjustments to reconcile net income (loss)
to net cash flows provided by operating activities:
Depreciation and amortization
24.7
25.9
98.6
103.3
Equity-based compensation expense
3.0
3.1
9.9
12.7
Deferred taxes
(7.6
)
(2.2
)
(14.9
)
(7.9
)
Defined benefit pension and other
postretirement employee benefits
(0.5
)
0.8
(2.0
)
3.0
Amortization of deferred debt costs and
debt retirement
3.4
0.2
4.4
2.0
Loss on sale or impairment associated with
assets
0.7
0.3
2.1
6.1
Changes in operating assets and
liabilities:
(Increase) decrease in accounts
receivable
(9.2
)
0.7
(1.3
)
(16.9
)
(Increase) decrease in inventory
14.1
2.8
4.0
(46.3
)
(Increase) decrease in other current
assets
(7.8
)
(8.0
)
0.8
(2.4
)
Increase (decrease) in accounts payable
and accrued liabilities
25.6
(0.8
)
(21.3
)
49.2
Other, net
1.5
0.4
2.6
1.5
Net cash flows provided by operating
activities
65.6
17.4
190.7
150.2
Investing Activities
Additions to property, plant and
equipment
(25.2
)
(13.5
)
(73.7
)
(33.5
)
Net cash flows used in investing
activities
(25.2
)
(13.5
)
(73.7
)
(33.5
)
Financing Activities
Borrowings on long-term debt
210.0
—
222.0
—
Repayments of long-term debt
(312.9
)
(0.1
)
(325.6
)
(80.9
)
Taxes paid related to net share settlement
of equity awards
—
—
(4.7
)
(2.5
)
Repurchases of common stock
(2.8
)
—
(17.9
)
(5.0
)
Payments for debt issuance costs
(2.9
)
(0.9
)
(3.1
)
(0.9
)
Other, net
—
—
—
0.8
Net cash flows used in financing
activities
(108.6
)
(1.0
)
(129.4
)
(88.6
)
Increase (decrease) in cash, cash
equivalents and restricted cash
(68.3
)
2.9
(12.4
)
28.2
Cash, cash equivalents and restricted cash
at beginning of period
110.2
51.5
54.4
26.2
Cash, cash equivalents and restricted cash
at end of period
$
42.0
$
54.4
$
42.0
$
54.4
Clearwater Paper
Corporation
Segment Information
(Unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
(In millions)
2023
2022
2023
2022
Segment net sales:
Pulp and Paperboard
$
251.3
$
273.5
$
1,063.7
$
1,136.3
Consumer Products
262.0
254.1
1,023.4
950.2
Eliminations
(0.5
)
(0.9
)
(4.3
)
(6.4
)
Total segment net sales
$
512.8
$
526.7
$
2,082.8
$
2,080.1
Operating income (loss):
Pulp and Paperboard
$
27.3
$
17.5
$
169.1
183.5
Consumer Products
31.1
$
1.6
91.7
11.3
Corporate and eliminations
(19.8
)
(17.3
)
(78.3
)
(71.1
)
Other operating charges, net 1
(2.9
)
(1.2
)
(5.3
)
(9.7
)
Income from operations
$
35.7
$
0.6
$
177.1
$
113.9
1
Other operating charges, net consist of
amounts unrelated to ongoing core operating activities. Please
refer to Note 8 within Clearwater Paper's Form 10-K filed with the
SEC for the year ended December 31, 2023 for the detailed breakout
of the annual amount.
Clearwater Paper
Corporation
Reconciliation of Non-GAAP
Financial Measures
Adjusted EBITDA
(Unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
(In millions)
2023
2022
2023
2022
Net income (loss)
$
17.6
$
(5.9
)
$
107.7
$
46.0
Add back:
Income tax provision (benefit)
6.8
(2.3
)
36.4
27.0
Interest expense, net
8.0
7.3
30.0
34.6
Depreciation and amortization expense
24.7
25.9
98.6
103.3
Other operating charges, net1
2.9
1.2
5.3
9.7
Other non-operating expense (income)
0.2
1.4
(0.1
)
5.7
Debt retirement costs
3.1
—
3.1
0.5
Adjusted EBITDA
$
63.3
$
27.8
$
281.0
$
226.9
Pulp and Paperboard segment income
$
27.3
$
17.5
$
169.1
$
183.5
Depreciation and amortization expense
9.5
9.2
37.4
37.0
Adjusted EBITDA Pulp and Paperboard
segment
$
36.8
$
26.7
$
206.4
$
220.4
Consumer Products segment income
$
31.1
$
1.6
$
91.7
$
11.3
Depreciation and amortization expense
14.6
16.0
58.8
62.9
Adjusted EBITDA Consumer Products
segment
$
45.7
$
17.6
$
150.5
$
74.2
Corporate and other expenses
$
(19.8
)
$
(17.3
)
$
(78.3
)
$
(71.1
)
Depreciation and amortization expense
0.6
0.8
2.4
3.4
Corporate Adjusted EBITDA
$
(19.2
)
$
(16.6
)
$
(75.9
)
$
(67.7
)
Pulp and Paperboard segment
$
36.8
$
26.7
$
206.4
$
220.4
Consumer Products segment
45.7
17.6
150.5
74.2
Corporate and other
(19.2
)
(16.6
)
(75.9
)
(67.7
)
Adjusted EBITDA
$
63.3
$
27.8
$
281.0
$
226.9
1
Other operating charges, net consist of
amounts unrelated to ongoing core operating activities. Please
refer to Note 8 within Clearwater Paper's Form 10-K filed with the
SEC for the year ended December 31, 2023 for the detailed breakout
of the annual amount.
Clearwater Paper
Corporation
Reconciliation of Non-GAAP
Financial Measures
Adjusted Net Income
(Unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
(In millions, except per share
data)
2023
2022
2023
2022
Net income (loss)
$
17.6
$
(5.9
)
$
107.7
$
46.0
Add back:
Income tax provision (benefit)
6.8
(2.3
)
36.4
27.0
Income (loss) before income taxes
24.4
(8.2
)
144.2
73.1
Add back:
Debt retirement costs
3.1
—
3.1
0.5
Other operating charges, net
2.9
1.2
5.3
9.7
Adjusted income (loss) before tax
30.4
(6.9
)
152.5
83.3
Normalized income provision (benefit)
7.6
(1.7
)
38.1
20.8
Adjusted net income (loss)
$
22.8
$
(5.2
)
$
114.4
$
62.5
Weighted average diluted shares (in
thousands)
16,867
17,204
17,091
17,181
Adjusted net income (loss) per share,
diluted
$
1.35
$
(0.30
)
$
6.69
$
3.63
Calculation of net debt:
December 31, 2023
September 30, 2023
December 31, 2022
Current portion of long-term debt
$
0.8
$
0.9
$
0.9
Long-term debt
462.3
564.8
564.9
Add back:
Unamortized deferred debt costs
5.1
2.8
3.4
Less:
Cash and cash equivalents
42.0
110.2
53.7
Net debt
$
426.3
$
458.3
$
515.5
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version on businesswire.com: https://www.businesswire.com/news/home/20240220873541/en/
Clearwater Paper Corporation
Investors contact: Sloan Bohlen Solebury Strategic
Communications 509-344-5906 investorinfo@clearwaterpaper.com
News media: Jules Joy, Director, Corporate Communications
509-344-5967 Julia.joy@clearwaterpaper.com
ClearWater Paper (NYSE:CLW)
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ClearWater Paper (NYSE:CLW)
Gráfico Histórico do Ativo
De Jan 2024 até Jan 2025
