Rayonier Advanced Materials Announces First Quarter 2021 Results

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  • Operating income was $55 million, $67 million favorable to the comparable period in 2020, driven by higher prices for lumber and commodity High Purity Cellulose along with stronger cellulose specialties volumes
  • Driven by higher book income tax expense, first quarter loss from continuing operations was $27 million, $2 million unfavorable to the comparable period in 2020; expect minimal cash taxes in 2021
  • First quarter Adjusted EBITDA from continuing operations of $91 million was up $64 million from the comparable quarter in 2020 primarily driven by higher lumber and High Purity Cellulose commodity prices along with stronger cellulose specialties volumes
  • Generated $21 million of Free Cash Flow for the quarter driven by higher prices partially offset by seasonal working capital build; expect $50 million from cash tax refunds during the next 12 months
  • Announced sale of lumber and newsprint assets for approximately $214 million, subject to inventory value adjustment, with a closing expected in the second half of the year, focusing the Company on its core High Purity Cellulose business, and the opportunity to further leverage sustainable, bio-based solutions
  • Announces significant investment in Anomera Inc. carboxylated cellulose nanocrystals (CNC), a patented, biodegradable product, supported by a distribution agreement with Croda, a UK based leader in ingredient formulations

JACKSONVILLE, Fla.-- May 4, 2021 -- Rayonier Advanced Materials Inc. (NYSE:RYAM) (the “Company”) reported loss from continuing operations for the quarter ended March 27, 2021 of $27 million or $0.43 per diluted share, compared to a loss from continuing operations of $25 million or $0.39 per diluted share for the same prior year quarter. The decline in the diluted earnings per share was due to higher book income tax expense, partially offset by higher prices for lumber and commodity High Purity Cellulose product sales prices along with stronger cellulose specialties volumes.

“As expected, first quarter operating results were significantly favorable to both the prior year and sequential quarter. The primary driver was a surge in lumber prices, which is expected to continue in the second quarter before moderating later in the year. We also captured higher value from our core High Purity Cellulose business and improved margins in our Paperboard and Pulp & Newsprint segments,” said Paul Boynton, President and Chief Executive Officer. “Recently, we also announced the strategic sale of our lumber and newsprint assets to GreenFirst Forest Products for $214 million. In addition to the attractive purchase price of 6.3 times trailing 3-year reported Adjusted EBITDA we will enter into a key 20-year agreement for chip supply to our Temiscaming facility. We will use the cash proceeds to reduce debt and reinvest in growth of our core high purity cellulose business.”

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Source: Rayonier Advanced Materials

 

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