The following is a summary of the Clearwater Paper Corporation (CLW) Q1 2024 Earnings Call Transcript:
Financial Performance:
Clearwater Paper had net sales of $496 million and adjusted EBITDA reaching $62 million in Q1 2024.
The company's tissue business saw an impressive increase in adjusted EBITDA from $19 million in Q1 of last year to $46 million this year.
The Paperboard business reported $34 million of adjusted EBITDA for this quarter.
The net income for the quarter totalled $17 million.
A $41 million free cash flow was generated in the quarter which led to a substantial $33 million reduction in net debt.
Business Progress:
Clearwater saw strong demand for tissue and recorded improved customer demand for paperboard.
A decrease in paperboard pricing by 11% from the previous year was reported.
Noteworthy progress has been made on the planned acquisition of the Augusta, Georgia Paperboard manufacturing facility from Graphic Packaging, with expectations to finalize this shortly.
Anticipated improvements in paperboard volumes and stability in the tissue sector are on the horizon, along with lower input costs and higher maintenance costs expected.
Clearwater removed 200,000 tons of net capacity from the tissue business between 2021 and 2023, leading to high industry utilization rates.
Approximately 370,000 tons of capacity will be added between 2024 and 2026, with expectations that natural demand growth will accommodate the added tons.
Weather disruptions at the Lewiston facility negatively impacted paperboard volumes in January.
The company aims to retain the margin improvements realized in 2023 and other operational targets moving forward.
More details: Clearwater Paper IR
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