Improved first quarter results; accelerating COVID-19 response plan
(All financial information is in
- First quarter 2020 net earnings of
$0.09 per share - Record quarter sales and EBITDA in Personal Care
- Several measures taken in response to COVID-19
- Suspension of quarterly dividends and share repurchase program
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200508005201/en/
Excluding items listed below, the Company had earnings before items1 of
ITEMS
Description |
Segment |
Line item |
Amount |
After tax effect |
EPS impact (per share) |
|
|
|
(in millions) |
|
|
First quarter 2020 |
|
|
|
|
|
|
|
|
|
|
|
● None |
|
|
|
|
|
|
|
|
|
|
|
Fourth quarter 2019 |
|
|
|
|
|
|
|
|
|
|
|
● Pension settlement loss |
Pulp and Paper |
Non-service components of |
|
|
|
|
|
|
|
|
|
● Paper machine closures |
Pulp and Paper |
Closure and |
|
|
|
|
|
|
|
|
|
● Margin improvement plan |
Personal Care |
Closure and |
|
|
|
|
|
|
|
|
|
First quarter 2019 |
|
|
|
|
|
|
|
|
|
|
|
● Margin improvement plan |
Personal Care |
Impairment of long-lived |
|
|
|
|
|
|
|
|
|
● Margin improvement plan |
Personal Care |
Closure and |
|
|
|
|
|
|
|
|
|
QUARTERLY REVIEW
“As the global community reacts to COVID-19 and the large-scale effort to contain it continues, we remain focused on navigating the crisis, keeping our employees and their families safe, serving our customers as an essential business, and protecting our financial stability. We are taking steps to reduce spending to further strengthen our balance sheet, liquidity and cash flow while seeking to ensure we are well positioned when the economy starts moving again”, said
“Despite our paper volumes increasing in Q1, we experienced a significant reduction of orders in April due to the COVID crisis and the resulting lockdown of schools, offices, retailers and other business sectors. As a result, we are taking the appropriate steps to optimize our operations and to remain an agile, reliable partner to our customers. We continue to closely monitor customer orders and backlogs, and will adjust capacity accordingly, but we anticipate inventory to be at appropriate levels as a result of our recently-announced capacity reduction plan,” said
Commenting on Personal Care,
Operating income was
Operating income before items1 was
|
|
|
|
|
|
|
|
|
(In millions of dollars) |
|
1Q 2020 |
|
|
4Q 2019 |
|
||
|
|
|
|
|
|
|
|
|
Sales |
|
$ |
1,278 |
|
|
$ |
1,244 |
|
Operating income (loss) |
|
|
|
|
|
|
|
|
Pulp and Paper segment |
|
|
4 |
|
|
|
(11 |
) |
Personal Care segment |
|
|
20 |
|
|
|
8 |
|
Corporate |
|
|
(5 |
) |
|
|
(12 |
) |
Total operating income (loss) |
|
|
19 |
|
|
|
(15 |
) |
Operating income before items1 |
|
|
19 |
|
|
|
4 |
|
Depreciation and amortization |
|
|
72 |
|
|
|
74 |
|
The increase in operating income in the first quarter of 2020 was the result of favorable productivity, higher volume, lower selling, general and administrative expenses, lower raw material and freight costs and favorable exchange rates. These factors were partially offset by lower average selling prices in pulp and paper and higher maintenance, fixed and other costs.
When compared to the fourth quarter of 2019, manufactured paper shipments were up 4% and pulp shipments decreased 4%. The shipment-to-production ratio for paper was 105% in the first quarter of 2020, compared to 106% in the fourth quarter of 2019. Paper inventories decreased by 30,000 tons, and pulp inventories increased by 24,000 metric tons when compared to the fourth quarter of 2019.
LIQUIDITY AND CAPITAL RESOURCES
Cash flow from operating activities amounted to
COVID-19 UPDATE
Government authorities across the globe have recognized the importance of the forest products sector based on the products we manufacture and their end uses. Accordingly,
COST CONTROL MEASURES
SUSPENSION OF CAPITAL RETURN PROGRAM
Due to the unprecedented market conditions and uncertainty caused by COVID-19, the Company has suspended the payment of its regular quarterly dividend and stock repurchase program in order to preserve cash and provide additional flexibility in the current environment. The Board of Directors will continue to evaluate the Company’s capital return program based upon customary considerations, including market conditions.
OUTLOOK
The high degree of uncertainty and volatility day-to-day and the longer term potential impacts of the economic lockdown remain unclear. In Paper, we expect significantly lower demand in the second quarter. We expect demand for softwood and fluff pulp to remain strong in the near-term driven by accelerated growth in tissue and towel, while containment measures across
EARNINGS CONFERENCE CALL
The Company will hold a conference call today at
The Company will release its second quarter 2020 earnings results on
About
Forward-Looking Statements
Statements in this release about our plans, expectations and future performance, including the statements by
_________ |
1 Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix. |
Highlights (In millions of dollars, unless otherwise noted) |
||||||||
|
|
For the three months ended |
||||||
|
|
|
|
|
|
|
||
|
|
2020 |
|
|
2019 |
|
||
|
|
(Unaudited) |
||||||
|
|
$ |
|
|
$ |
|
||
Selected Segment Information |
|
|
|
|
|
|
|
|
Sales |
|
|
|
|
|
|
|
|
Pulp and Paper |
|
|
1,031 |
|
|
|
1,157 |
|
Personal Care |
|
|
266 |
|
|
|
239 |
|
Total for reportable segments |
|
|
1,297 |
|
|
|
1,396 |
|
Intersegment sales |
|
|
(19 |
) |
|
|
(20 |
) |
Consolidated sales |
|
|
1,278 |
|
|
|
1,376 |
|
Depreciation and amortization |
|
|
|
|
|
|
|
|
Pulp and Paper |
|
|
58 |
|
|
|
58 |
|
Personal Care |
|
|
14 |
|
|
|
15 |
|
Total for reportable segments |
|
|
72 |
|
|
|
73 |
|
Impairment of long-lived assets – Personal Care |
|
|
— |
|
|
|
10 |
|
Consolidated depreciation and amortization and impairment of long-lived assets |
|
|
72 |
|
|
|
83 |
|
Operating income (loss) |
|
|
|
|
|
|
|
|
Pulp and Paper |
|
|
4 |
|
|
|
144 |
|
Personal Care |
|
|
20 |
|
|
|
(8 |
) |
Corporate |
|
|
(5 |
) |
|
|
(21 |
) |
Consolidated operating income |
|
|
19 |
|
|
|
115 |
|
Interest expense, net |
|
|
14 |
|
|
|
13 |
|
Non-service components of net periodic benefit cost |
|
|
(4 |
) |
|
|
(3 |
) |
Earnings before income taxes and equity loss |
|
|
9 |
|
|
|
105 |
|
Income tax expense |
|
|
3 |
|
|
|
24 |
|
Equity loss, net of taxes |
|
|
1 |
|
|
|
1 |
|
Net earnings |
|
|
5 |
|
|
|
80 |
|
Per common share (in dollars) |
|
|
|
|
|
|
|
|
Net earnings |
|
|
|
|
|
|
|
|
Basic |
|
|
0.09 |
|
|
|
1.27 |
|
Diluted |
|
|
0.09 |
|
|
|
1.27 |
|
Weighted average number of common shares outstanding (millions) |
|
|
|
|
|
|
|
|
Basic |
|
|
56.1 |
|
|
|
63.0 |
|
Diluted |
|
|
56.2 |
|
|
|
63.2 |
|
Cash flows from operating activities |
|
|
88 |
|
|
|
55 |
|
Additions to property, plant and equipment |
|
|
62 |
|
|
|
46 |
|
As a result of changes in our organization structure, we have changed our segment reporting. Starting
Consolidated Statements of Earnings (In millions of dollars, unless otherwise noted) |
||||||||
|
|
For the three months ended |
||||||
|
|
|
|
|
|
|
||
|
|
2020 |
|
|
2019 |
|
||
|
|
(Unaudited) |
||||||
|
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
|
|
Sales |
|
|
1,278 |
|
|
|
1,376 |
|
Operating expenses |
|
|
|
|
|
|
|
|
Cost of sales, excluding depreciation and amortization |
|
|
1,083 |
|
|
|
1,052 |
|
Depreciation and amortization |
|
|
72 |
|
|
|
73 |
|
Selling, general and administrative |
|
|
102 |
|
|
|
123 |
|
Impairment of long-lived assets |
|
|
— |
|
|
|
10 |
|
Closure and restructuring costs |
|
|
— |
|
|
|
4 |
|
Other operating loss (income), net |
|
|
2 |
|
|
|
(1 |
) |
|
|
|
1,259 |
|
|
|
1,261 |
|
Operating income |
|
|
19 |
|
|
|
115 |
|
Interest expense, net |
|
|
14 |
|
|
|
13 |
|
Non-service components of net periodic benefit cost |
|
|
(4 |
) |
|
|
(3 |
) |
Earnings before income taxes and equity loss |
|
|
9 |
|
|
|
105 |
|
Income tax expense |
|
|
3 |
|
|
|
24 |
|
Equity loss, net of taxes |
|
|
1 |
|
|
|
1 |
|
Net earnings |
|
|
5 |
|
|
|
80 |
|
Per common share (in dollars) |
|
|
|
|
|
|
|
|
Net earnings |
|
|
|
|
|
|
|
|
Basic |
|
|
0.09 |
|
|
|
1.27 |
|
Diluted |
|
|
0.09 |
|
|
|
1.27 |
|
Weighted average number of common shares outstanding (millions) |
|
|
|
|
|
|
|
|
Basic |
|
|
56.1 |
|
|
|
63.0 |
|
Diluted |
|
|
56.2 |
|
|
|
63.2 |
|
Consolidated Balance Sheets at (In millions of dollars) |
||||||||
|
|
|
|
|||||
|
|
|
|
|
|
|
||
|
|
2020 |
|
|
2019 |
|
||
|
|
(Unaudited) |
||||||
|
|
$ |
|
|
$ |
|
||
Assets |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
152 |
|
|
|
61 |
|
Receivables, less allowances of |
|
|
600 |
|
|
|
577 |
|
Inventories |
|
|
740 |
|
|
|
786 |
|
Prepaid expenses |
|
|
32 |
|
|
|
33 |
|
Income and other taxes receivable |
|
|
27 |
|
|
|
61 |
|
Total current assets |
|
|
1,551 |
|
|
|
1,518 |
|
Property, plant and equipment, net |
|
|
2,493 |
|
|
|
2,567 |
|
Operating lease right-of-use assets |
|
|
77 |
|
|
|
81 |
|
Intangible assets, net |
|
|
561 |
|
|
|
573 |
|
Other assets |
|
|
151 |
|
|
|
164 |
|
Total assets |
|
|
4,833 |
|
|
|
4,903 |
|
Liabilities and shareholders’ equity |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Bank indebtedness |
|
|
— |
|
|
|
9 |
|
Trade and other payables |
|
|
700 |
|
|
|
705 |
|
Income and other taxes payable |
|
|
26 |
|
|
|
23 |
|
Operating lease liabilities due within one year |
|
|
27 |
|
|
|
28 |
|
Long-term debt due within one year |
|
|
1 |
|
|
|
1 |
|
Total current liabilities |
|
|
754 |
|
|
|
766 |
|
Long-term debt |
|
|
1,102 |
|
|
|
938 |
|
Operating lease liabilities |
|
|
65 |
|
|
|
69 |
|
Deferred income taxes and other |
|
|
457 |
|
|
|
479 |
|
Other liabilities and deferred credits |
|
|
274 |
|
|
|
275 |
|
Shareholders’ equity |
|
|
|
|
|
|
|
|
Common stock |
|
|
1 |
|
|
|
1 |
|
Additional paid-in capital |
|
|
1,710 |
|
|
|
1,770 |
|
Retained earnings |
|
|
978 |
|
|
|
998 |
|
Accumulated other comprehensive loss |
|
|
(508 |
) |
|
|
(393 |
) |
Total shareholders’ equity |
|
|
2,181 |
|
|
|
2,376 |
|
Total liabilities and shareholders’ equity |
|
|
4,833 |
|
|
|
4,903 |
|
Consolidated Statements of Cash Flows (In millions of dollars) |
|||||||
|
For the three months ended |
||||||
|
|
|
|
|
|
||
|
(Unaudited) |
||||||
|
$ |
|
|
$ |
|
||
Operating activities |
|
|
|
|
|
|
|
Net earnings |
|
5 |
|
|
|
80 |
|
Adjustments to reconcile net earnings to cash flows from operating activities |
|
|
|
|
|
|
|
Depreciation and amortization |
|
72 |
|
|
|
73 |
|
Deferred income taxes and tax uncertainties |
|
1 |
|
|
|
(3 |
) |
Impairment of long-lived assets |
|
— |
|
|
|
10 |
|
Stock-based compensation expense |
|
1 |
|
|
|
2 |
|
Equity loss, net |
|
1 |
|
|
|
1 |
|
Changes in assets and liabilities |
|
|
|
|
|
|
|
Receivables |
|
(28 |
) |
|
|
(30 |
) |
Inventories |
|
28 |
|
|
|
(49 |
) |
Prepaid expenses |
|
(5 |
) |
|
|
— |
|
Trade and other payables |
|
(16 |
) |
|
|
(69 |
) |
Income and other taxes |
|
39 |
|
|
|
26 |
|
Difference between employer pension and other post-retirement contributions and pension and other post-retirement expense |
|
(1 |
) |
|
|
1 |
|
Other assets and other liabilities |
|
(9 |
) |
|
|
13 |
|
Cash flows from operating activities |
|
88 |
|
|
|
55 |
|
Investing activities |
|
|
|
|
|
|
|
Additions to property, plant and equipment |
|
(62 |
) |
|
|
(46 |
) |
Cash flows used for investing activities |
|
(62 |
) |
|
|
(46 |
) |
Financing activities |
|
|
|
|
|
|
|
Dividend payments |
|
(26 |
) |
|
|
(27 |
) |
Stock repurchase |
|
(59 |
) |
|
|
— |
|
Net change in bank indebtedness |
|
(10 |
) |
|
|
3 |
|
Change in revolving credit facility |
|
140 |
|
|
|
— |
|
Proceeds from receivables securitization facility |
|
25 |
|
|
|
20 |
|
Repayments of receivables securitization facility |
|
— |
|
|
|
(20 |
) |
Other |
|
(3 |
) |
|
|
(1 |
) |
Cash flows provided from (used for) financing activities |
|
67 |
|
|
|
(25 |
) |
Net increase (decrease) in cash and cash equivalents |
|
93 |
|
|
|
(16 |
) |
Impact of foreign exchange on cash |
|
(2 |
) |
|
|
(1 |
) |
Cash and cash equivalents at beginning of period |
|
61 |
|
|
|
111 |
|
Cash and cash equivalents at end of period |
|
152 |
|
|
|
94 |
|
Supplemental cash flow information |
|
|
|
|
|
|
|
Net cash payments (refund) for: |
|
|
|
|
|
|
|
Interest |
|
17 |
|
|
|
16 |
|
Income taxes |
|
(25 |
) |
|
|
6 |
|
|
Quarterly Reconciliation of Non-GAAP Financial Measures |
(In millions of dollars, unless otherwise noted) |
The following table sets forth certain non-
|
|
|
|
|
|
2020 |
|
|
2019 |
|
||||||||||||||||||
|
|
|
|
|
|
Q1 |
|
|
Q1 |
|
|
Q2 |
|
|
Q3 |
|
|
Q4 |
|
|
Year |
|
||||||
Reconciliation of “Earnings before items” to Net earnings (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Net earnings (loss) |
|
($) |
|
|
5 |
|
|
|
80 |
|
|
|
18 |
|
|
|
20 |
|
|
|
(34 |
) |
|
|
84 |
|
|
(+) |
Pension settlement loss |
|
($) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
22 |
|
|
|
22 |
|
|
(+) |
Impairment of long-lived assets |
|
($) |
|
|
— |
|
|
|
8 |
|
|
|
12 |
|
|
|
26 |
|
|
|
— |
|
|
|
46 |
|
|
(+) |
Closure and restructuring costs |
|
($) |
|
|
— |
|
|
|
3 |
|
|
|
6 |
|
|
|
9 |
|
|
|
14 |
|
|
|
32 |
|
|
(=) |
Earnings before items |
|
($) |
|
|
5 |
|
|
|
91 |
|
|
|
36 |
|
|
|
55 |
|
|
|
2 |
|
|
|
184 |
|
|
(/) |
Weighted avg. number of common shares outstanding (diluted) |
|
(millions) |
|
|
56.2 |
|
|
|
63.2 |
|
|
|
63.3 |
|
|
|
61.7 |
|
|
|
57.3 |
|
|
|
61.4 |
|
|
(=) |
Earnings before items per diluted share |
|
($) |
|
|
0.09 |
|
|
|
1.44 |
|
|
|
0.57 |
|
|
|
0.89 |
|
|
|
0.03 |
|
|
|
3.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of “EBITDA” and “EBITDA before items” to Net earnings (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Net earnings (loss) |
|
($) |
|
|
5 |
|
|
|
80 |
|
|
|
18 |
|
|
|
20 |
|
|
|
(34 |
) |
|
|
84 |
|
|
(+) |
Equity loss, net of taxes |
|
($) |
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
2 |
|
|
(+) |
Income tax expense (benefit) |
|
($) |
|
|
3 |
|
|
|
24 |
|
|
|
5 |
|
|
|
(1 |
) |
|
|
(26 |
) |
|
|
2 |
|
|
(+) |
Interest expense, net |
|
($) |
|
|
14 |
|
|
|
13 |
|
|
|
13 |
|
|
|
12 |
|
|
|
14 |
|
|
|
52 |
|
|
(+) |
Depreciation and amortization |
|
($) |
|
|
72 |
|
|
|
73 |
|
|
|
74 |
|
|
|
72 |
|
|
|
74 |
|
|
|
293 |
|
|
(+) |
Impairment of long-lived assets |
|
($) |
|
|
— |
|
|
|
10 |
|
|
|
15 |
|
|
|
33 |
|
|
|
— |
|
|
|
58 |
|
|
(=) |
EBITDA |
|
($) |
|
|
95 |
|
|
|
201 |
|
|
|
125 |
|
|
|
136 |
|
|
|
29 |
|
|
|
491 |
|
|
(/) |
Sales |
|
($) |
|
|
1,278 |
|
|
|
1,376 |
|
|
|
1,317 |
|
|
|
1,283 |
|
|
|
1,244 |
|
|
|
5,220 |
|
|
(=) |
EBITDA margin |
|
(%) |
|
|
7 |
% |
|
|
15 |
% |
|
|
9 |
% |
|
|
11 |
% |
|
|
2 |
% |
|
|
9 |
% |
|
|
EBITDA |
|
($) |
|
|
95 |
|
|
|
201 |
|
|
|
125 |
|
|
|
136 |
|
|
|
29 |
|
|
|
491 |
|
|
(+) |
Pension settlement loss |
|
($) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
30 |
|
|
|
30 |
|
|
(+) |
Closure and restructuring costs |
|
($) |
|
|
— |
|
|
|
4 |
|
|
|
8 |
|
|
|
11 |
|
|
|
19 |
|
|
|
42 |
|
|
(=) |
EBITDA before items |
|
($) |
|
|
95 |
|
|
|
205 |
|
|
|
133 |
|
|
|
147 |
|
|
|
78 |
|
|
|
563 |
|
|
(/) |
Sales |
|
($) |
|
|
1,278 |
|
|
|
1,376 |
|
|
|
1,317 |
|
|
|
1,283 |
|
|
|
1,244 |
|
|
|
5,220 |
|
|
(=) |
EBITDA margin before items |
|
(%) |
|
|
7 |
% |
|
|
15 |
% |
|
|
10 |
% |
|
|
11 |
% |
|
|
6 |
% |
|
|
11 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of “Free cash flow” to Cash flows from operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Cash flows from operating activities |
|
($) |
|
|
88 |
|
|
|
55 |
|
|
|
119 |
|
|
|
108 |
|
|
|
160 |
|
|
|
442 |
|
|
(-) |
Additions to property, plant and equipment |
|
($) |
|
|
(62 |
) |
|
|
(46 |
) |
|
|
(55 |
) |
|
|
(56 |
) |
|
|
(98 |
) |
|
|
(255 |
) |
|
(=) |
Free cash flow |
|
($) |
|
|
26 |
|
|
|
9 |
|
|
|
64 |
|
|
|
52 |
|
|
|
62 |
|
|
|
187 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
“Net debt-to-total capitalization” computation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Bank indebtedness |
|
($) |
|
|
— |
|
|
|
3 |
|
|
|
3 |
|
|
|
1 |
|
|
|
9 |
|
|
|
|
|
|
(+) |
Long-term debt due within one year |
|
($) |
|
|
1 |
|
|
|
1 |
|
|
|
1 |
|
|
|
1 |
|
|
|
1 |
|
|
|
|
|
|
(+) |
Long-term debt |
|
($) |
|
|
1,102 |
|
|
|
853 |
|
|
|
824 |
|
|
|
938 |
|
|
|
938 |
|
|
|
|
|
|
(=) |
Debt |
|
($) |
|
|
1,103 |
|
|
|
857 |
|
|
|
828 |
|
|
|
940 |
|
|
|
948 |
|
|
|
|
|
|
(-) |
Cash and cash equivalents |
|
($) |
|
|
(152 |
) |
|
|
(94 |
) |
|
|
(93 |
) |
|
|
(98 |
) |
|
|
(61 |
) |
|
|
|
|
|
(=) |
Net debt |
|
($) |
|
|
951 |
|
|
|
763 |
|
|
|
735 |
|
|
|
842 |
|
|
|
887 |
|
|
|
|
|
|
(+) |
Shareholders’ equity |
|
($) |
|
|
2,181 |
|
|
|
2,608 |
|
|
|
2,619 |
|
|
|
2,439 |
|
|
|
2,376 |
|
|
|
|
|
|
(=) |
Total capitalization |
|
($) |
|
|
3,132 |
|
|
|
3,371 |
|
|
|
3,354 |
|
|
|
3,281 |
|
|
|
3,263 |
|
|
|
|
|
|
|
Net debt |
|
($) |
|
|
951 |
|
|
|
763 |
|
|
|
735 |
|
|
|
842 |
|
|
|
887 |
|
|
|
|
|
|
(/) |
Total capitalization |
|
($) |
|
|
3,132 |
|
|
|
3,371 |
|
|
|
3,354 |
|
|
|
3,281 |
|
|
|
3,263 |
|
|
|
|
|
|
(=) |
Net debt-to-total capitalization |
|
(%) |
|
|
30 |
% |
|
|
23 |
% |
|
|
22 |
% |
|
|
26 |
% |
|
|
27 |
% |
|
|
|
|
“Earnings before items”, “Earnings before items per diluted share”, “EBITDA”, “EBITDA margin”, “EBITDA before items”, “EBITDA margin before items”, “Free cash flow”, “Net debt” and “Net debt-to-total capitalization” have no standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation or as a substitute for Net earnings (loss) or any other earnings statement, cash flow statement or balance sheet financial information prepared in accordance with GAAP. It is important for readers to understand that certain items may be presented in different lines by different companies on their financial statements, thereby leading to different measures for different companies.
|
Quarterly Reconciliation of Non-GAAP Financial Measures – By Segment 2020 |
(In millions of dollars, unless otherwise noted) |
The following table sets forth certain non-
|
|
|
|
|
|
Pulp and Paper |
|
Personal Care |
|
Corporate |
|
Total |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
Q1’20 |
|
Q2’20 |
|
Q3’20 |
|
Q4’20 |
|
YTD |
|
Q1’20 |
|
Q2’20 |
|
Q3’20 |
|
Q4’20 |
|
YTD |
|
Q1’20 |
|
Q2’20 |
|
Q3’20 |
|
Q4’20 |
|
YTD |
|
Q1’20 |
|
Q2’20 |
|
Q3’20 |
|
Q4’20 |
|
YTD |
Reconciliation of Operating income (loss) to “Operating income (loss) before items” |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Operating income (loss) |
|
($) |
|
4 |
|
— |
|
— |
|
— |
|
4 |
|
20 |
|
— |
|
— |
|
— |
|
20 |
|
(5) |
|
— |
|
— |
|
— |
|
(5) |
|
19 |
|
— |
|
— |
|
— |
|
19 |
|
(=) |
Operating income (loss) before items |
|
($) |
|
4 |
|
— |
|
— |
|
— |
|
4 |
|
20 |
|
— |
|
— |
|
— |
|
20 |
|
(5) |
|
— |
|
— |
|
— |
|
(5) |
|
19 |
|
— |
|
— |
|
— |
|
19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of “Operating income (loss) before items” to “EBITDA before items” |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Operating income (loss) before items |
|
($) |
|
4 |
|
— |
|
— |
|
— |
|
4 |
|
20 |
|
— |
|
— |
|
— |
|
20 |
|
(5) |
|
— |
|
— |
|
— |
|
(5) |
|
19 |
|
— |
|
— |
|
— |
|
19 |
|
(+) |
Non-service components of net periodic benefit cost |
|
($) |
|
4 |
|
— |
|
— |
|
— |
|
4 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
4 |
|
— |
|
— |
|
— |
|
4 |
|
(+) |
Depreciation and amortization |
|
($) |
|
58 |
|
— |
|
— |
|
— |
|
58 |
|
14 |
|
— |
|
— |
|
— |
|
14 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
72 |
|
— |
|
— |
|
— |
|
72 |
|
(=) |
EBITDA before items |
|
($) |
|
66 |
|
— |
|
— |
|
— |
|
66 |
|
34 |
|
— |
|
— |
|
— |
|
34 |
|
(5) |
|
— |
|
— |
|
— |
|
(5) |
|
95 |
|
— |
|
— |
|
— |
|
95 |
|
(/) |
Sales |
|
($) |
|
1,031 |
|
— |
|
— |
|
— |
|
1,031 |
|
266 |
|
— |
|
— |
|
— |
|
266 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,297 |
|
— |
|
— |
|
— |
|
1,297 |
|
(=) |
EBITDA margin before items |
|
(%) |
|
6% |
|
— |
|
— |
|
— |
|
6% |
|
13% |
|
— |
|
— |
|
— |
|
13% |
|
— |
|
— |
|
— |
|
— |
|
— |
|
7% |
|
— |
|
— |
|
— |
|
7% |
“Operating income (loss) before items”, “EBITDA before items” and “EBITDA margin before items” have no standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation or as a substitute for Operating income (loss) or any other earnings statement, cash flow statement or balance sheet financial information prepared in accordance with GAAP. It is important for readers to understand that certain items may be presented in different lines by different companies on their financial statements, thereby leading to different measures for different companies.
|
Quarterly Reconciliation of Non-GAAP Financial Measures – By Segment 2019 |
(In millions of dollars, unless otherwise noted) |
The following table sets forth certain non-
|
|
|
|
|
|
Pulp and Paper |
|
Personal Care |
|
Corporate |
|
Total |
||||||||||||||||||||||||||||||||
|
|
|
|
|
|
Q1’19 |
|
Q2’19 |
|
Q3’19 |
|
Q4’19 |
|
Year |
|
Q1’19 |
|
Q2’19 |
|
Q3’19 |
|
Q4’19 |
|
Year |
|
Q1’19 |
|
Q2’19 |
|
Q3’19 |
|
Q4’19 |
|
Year |
|
Q1’19 |
|
Q2’19 |
|
Q3’19 |
|
Q4’19 |
|
Year |
Reconciliation of Operating income (loss) to “Operating income (loss) before items” |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Operating income (loss) |
|
($) |
|
144 |
|
62 |
|
31 |
|
(11) |
|
226 |
|
(8) |
|
(18) |
|
2 |
|
8 |
|
(16) |
|
(21) |
|
(10) |
|
(4) |
|
(12) |
|
(47) |
|
115 |
|
34 |
|
29 |
|
(15) |
|
163 |
|
(+) |
Impairment of long-lived assets |
|
($) |
|
— |
|
— |
|
32 |
|
— |
|
32 |
|
10 |
|
15 |
|
1 |
|
— |
|
26 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
10 |
|
15 |
|
33 |
|
— |
|
58 |
|
(+) |
Closure and restructuring costs |
|
($) |
|
— |
|
— |
|
5 |
|
17 |
|
22 |
|
4 |
|
8 |
|
6 |
|
2 |
|
20 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
4 |
|
8 |
|
11 |
|
19 |
|
42 |
|
(=) |
Operating income (loss) before items |
|
($) |
|
144 |
|
62 |
|
68 |
|
6 |
|
280 |
|
6 |
|
5 |
|
9 |
|
10 |
|
30 |
|
(21) |
|
(10) |
|
(4) |
|
(12) |
|
(47) |
|
129 |
|
57 |
|
73 |
|
4 |
|
263 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of “Operating income (loss) before items” to “EBITDA before items” |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Operating income (loss) before items |
|
($) |
|
144 |
|
62 |
|
68 |
|
6 |
|
280 |
|
6 |
|
5 |
|
9 |
|
10 |
|
30 |
|
(21) |
|
(10) |
|
(4) |
|
(12) |
|
(47) |
|
129 |
|
57 |
|
73 |
|
4 |
|
263 |
|
(+) |
Pension settlement loss |
|
($) |
|
— |
|
— |
|
— |
|
30 |
|
30 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
30 |
|
30 |
|
(+) |
Non-service components of net periodic benefit cost |
|
($) |
|
3 |
|
3 |
|
2 |
|
(28) |
|
(20) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(1) |
|
— |
|
(2) |
|
(3) |
|
3 |
|
2 |
|
2 |
|
(30) |
|
(23) |
|
(+) |
Depreciation and amortization |
|
($) |
|
58 |
|
59 |
|
57 |
|
57 |
|
231 |
|
15 |
|
15 |
|
15 |
|
17 |
|
62 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
73 |
|
74 |
|
72 |
|
74 |
|
293 |
|
(=) |
EBITDA before items |
|
($) |
|
205 |
|
124 |
|
127 |
|
65 |
|
521 |
|
21 |
|
20 |
|
24 |
|
27 |
|
92 |
|
(21) |
|
(11) |
|
(4) |
|
(14) |
|
(50) |
|
205 |
|
133 |
|
147 |
|
78 |
|
563 |
|
(/) |
Sales |
|
($) |
|
1,157 |
|
1,106 |
|
1,079 |
|
1,027 |
|
4,369 |
|
239 |
|
228 |
|
219 |
|
234 |
|
920 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1,396 |
|
1,334 |
|
1,298 |
|
1,261 |
|
5,289 |
|
(=) |
EBITDA margin before items |
|
(%) |
|
18% |
|
11% |
|
12% |
|
6% |
|
12% |
|
9% |
|
9% |
|
11% |
|
12% |
|
10% |
|
— |
|
— |
|
— |
|
— |
|
— |
|
15% |
|
10% |
|
11% |
|
6% |
|
11% |
“Operating income (loss) before items”, “EBITDA before items” and “EBITDA margin before items” have no standardized meaning prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies and therefore should not be considered in isolation or as a substitute for Operating income (loss) or any other earnings statement, cash flow statement or balance sheet financial information prepared in accordance with GAAP. It is important for readers to understand that certain items may be presented in different lines by different companies on their financial statements, thereby leading to different measures for different companies.
As a result of changes in our organization structure, we have changed our segment reporting. Starting
Supplemental Segmented Information (In millions of dollars, unless otherwise noted) |
||||||||||||||||||||||||||
|
|
|
|
2020 |
|
|
2019 |
|
||||||||||||||||||
|
|
|
|
Q1 |
|
|
Q1 |
|
|
Q2 |
|
|
Q3 |
|
|
Q4 |
|
|
Year |
|
||||||
Pulp and Paper Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
($) |
|
|
1,031 |
|
|
|
1,157 |
|
|
|
1,106 |
|
|
|
1,079 |
|
|
|
1,027 |
|
|
|
4,369 |
|
Operating income (loss) |
|
($) |
|
|
4 |
|
|
|
144 |
|
|
|
62 |
|
|
|
31 |
|
|
|
(11 |
) |
|
|
226 |
|
Depreciation and amortization |
|
($) |
|
|
58 |
|
|
|
58 |
|
|
|
59 |
|
|
|
57 |
|
|
|
57 |
|
|
|
231 |
|
Impairment of long-lived assets |
|
($) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
32 |
|
|
|
— |
|
|
|
32 |
|
Paper |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Paper Production |
|
(‘000 ST) |
|
|
648 |
|
|
|
757 |
|
|
|
697 |
|
|
|
653 |
|
|
|
619 |
|
|
|
2,726 |
|
Paper Shipments – Manufactured |
|
(‘000 ST) |
|
|
679 |
|
|
|
736 |
|
|
|
681 |
|
|
|
672 |
|
|
|
656 |
|
|
|
2,745 |
|
Communication Papers |
|
(‘000 ST) |
|
|
569 |
|
|
|
615 |
|
|
|
567 |
|
|
|
563 |
|
|
|
554 |
|
|
|
2,299 |
|
Specialty and Packaging Papers |
|
(‘000 ST) |
|
|
110 |
|
|
|
121 |
|
|
|
114 |
|
|
|
109 |
|
|
|
102 |
|
|
|
446 |
|
Paper Shipments – Sourced from 3rd parties |
|
(‘000 ST) |
|
|
22 |
|
|
|
23 |
|
|
|
21 |
|
|
|
25 |
|
|
|
24 |
|
|
|
93 |
|
Paper Shipments – Total |
|
(‘000 ST) |
|
|
701 |
|
|
|
759 |
|
|
|
702 |
|
|
|
697 |
|
|
|
680 |
|
|
|
2,838 |
|
Pulp |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pulp Shipments(a) |
|
(‘000 ADMT) |
|
|
389 |
|
|
|
349 |
|
|
|
370 |
|
|
|
416 |
|
|
|
404 |
|
|
|
1,539 |
|
Pulp Shipments mix(b): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hardwood Kraft Pulp |
|
(%) |
|
|
3 |
% |
|
|
2 |
% |
|
|
2 |
% |
|
|
5 |
% |
|
|
5 |
% |
|
|
4 |
% |
Softwood Kraft Pulp |
|
(%) |
|
|
52 |
% |
|
|
53 |
% |
|
|
56 |
% |
|
|
55 |
% |
|
|
54 |
% |
|
|
54 |
% |
Fluff Pulp |
|
(%) |
|
|
45 |
% |
|
|
45 |
% |
|
|
42 |
% |
|
|
40 |
% |
|
|
41 |
% |
|
|
42 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal Care Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
($) |
|
|
266 |
|
|
|
239 |
|
|
|
228 |
|
|
|
219 |
|
|
|
234 |
|
|
|
920 |
|
Operating income (loss) |
|
($) |
|
|
20 |
|
|
|
(8 |
) |
|
|
(18 |
) |
|
|
2 |
|
|
|
8 |
|
|
|
(16 |
) |
Depreciation and amortization |
|
($) |
|
|
14 |
|
|
|
15 |
|
|
|
15 |
|
|
|
15 |
|
|
|
17 |
|
|
|
62 |
|
Impairment of long-lived assets |
|
($) |
|
|
— |
|
|
|
10 |
|
|
|
15 |
|
|
|
1 |
|
|
|
— |
|
|
|
26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Exchange Rates |
|
$US / $CAN |
|
|
1.344 |
|
|
|
1.329 |
|
|
|
1.337 |
|
|
|
1.321 |
|
|
|
1.321 |
|
|
|
1.327 |
|
|
|
$CAN / $US |
|
|
0.744 |
|
|
|
0.752 |
|
|
|
0.748 |
|
|
|
0.757 |
|
|
|
0.757 |
|
|
|
0.754 |
|
|
|
€ / $US |
|
|
1.102 |
|
|
|
1.136 |
|
|
|
1.124 |
|
|
|
1.111 |
|
|
|
1.107 |
|
|
|
1.120 |
|
As a result of changes in our organization structure, we have changed our segment reporting. Starting
(a) Figures represent Pulp Shipments to third parties. |
|
(b) Percentages include Pulp Shipments to our Personal Care segment. |
|
Note: the term “ST” refers to a short ton and the term “ADMT” refers to an air dry metric ton. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20200508005201/en/
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