Clearwater Paper Corp 8-K, filed Feb 13, 2025
Clearwater Paper Corp (CLW)
8-K
2025-02-13
For: 2025-02-13
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Added on
April 06, 2026
About this 8-K
Clearwater Paper Corp filed this 8-K on February 13, 2025.
Items reported
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 13, 2025
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | ||||||||||
(509 ) 344-5900
(Registrant’s telephone number, including area code)
Not Applicable
(Former name of former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchanged on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On February 13, 2025 , Clearwater Paper Corporation (the “Company”) announced its results of operations for the fourth quarter and year ending December 31, 2024. A copy of the press release containing this announcement is furnished as Exhibit 99.1 hereto. In addition, a copy of the Company’s Fourth Quarter 2024 Earnings Release Materials is furnished as Exhibit 99.2 hereto.
In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), the following are disclosed: Adjusted EBITDA from continuing operations and Adjusted EBITDA from total operations which includes both continuing and discontinued operations and net sales from total operations which includes both continuing and discontinued. Neither Adjusted EBITDA from continuing operations nor Adjusted EBITDA from total operations is a substitute for the GAAP measure of net income or other GAAP measures of operating performance.
The Company discloses Adjusted EBITDA from continuing operations and Adjusted EBITDA total operations in the attached because management believes these 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 from continuing operations and Adjusted EBITDA from total operations: (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 from total operations to measure the company's compliance with certain covenants.
The Company believes that Adjusted EBITDA from continuing operations and Adjusted EBITDA from total operations, which excludes other operating credits and charges, net, interest expense, net, income tax (benefit) expense and depreciation and amortization, gain on sale of discontinued operations, and other non-operating items is a useful measure for evaluating our ability to generate earnings and that providing this measure will allow investors to more readily compare the earnings referred to in the press release to the Company's earnings for past and future periods. The Company believes that these measures are particularly useful where the amounts of the excluded items are not consistent between the periods presented. It should be noted that other companies may present similarly-titled measures differently and, therefore, as presented by the Company may not be comparable to similarly-titled measures reported by other companies. In addition, Adjusted EBITDA from continuing operations and Adjusted EBITDA from total operations has material limitations as a performance measures because it excludes items that are actually incurred or experienced in connection with the operations of the Company's business.
Item 9.01. Financial Statements and Exhibits
(d) Exhibit Index
| Exhibit | Description | ||||
| 99.1 | |||||
| 99.2 | |||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: February 13, 2025
CLEARWATER PAPER CORPORATION
| By: | /s/ Rebecca A. Barckley | ||||
| Rebecca A. Barckley, Vice President, Corporate Controller | |||||
| (Principal Accounting Officer) | |||||
Exhibit 99.1
Clearwater Paper Reports Fourth Quarter and Year End 2024 Results
SPOKANE, Wash.--(BUSINESS WIRE)-- February 13, 2025 -- Clearwater Paper Corporation (NYSE:CLW), a premier independent supplier of bleached paperboard to North American converters today reported financial results for the fourth quarter and year ended December 31, 2024.
With the completion of the sale of our tissue business on November 1, 2024, all periods presented include our former tissue segment as discontinued operations and the paperboard segment plus corporate expenses as continuing operations. Total operations includes both continuing and discontinued operations.
2024 FULL YEAR HIGHLIGHTS
•Acquired Augusta, Georgia paperboard facility on May 1, 2024; sold tissue business on November 1, 2024
•Net sales from continuing operations of $1.4 billion, up 22% compared to 2023, primarily due to incremental volume from our Augusta acquisition
•Net sales from total operations of $2.2 billion, up 6% compared to 2023
•Net loss from continuing operations of $74 million, or 4.41 per diluted share compared to net income from continuing operations of $49 million, or $2.85 per diluted share in the last year
•Net income from total operations of $196 million or $11.70 per diluted share, which includes the gain on sale of our tissue operations of $307 million ($219 million after tax or $13.11 per diluted share) compared to $108 million, or $6.30 per diluted share in last year
•Adjusted EBITDA from total operations of $182 million compared to $281 million last year, down primarily due to lower paperboard pricing
•Reduced net debt by $199 million, repurchased $10 million of outstanding shares
“2024 was a transformational year for Clearwater Paper. We took significant steps to focus our strategy on becoming a paperboard packaging company. We acquired a high-quality manufacturing facility in Augusta, Georgia, increasing our paperboard capacity by nearly 75% and improving our geographic footprint in North America,” said Arsen Kitch, president and chief executive officer. “We also divested our tissue business for $1.06 billion at closing and used the proceeds to de-lever our balance sheet and position the company for future growth in paperboard.”
OVERALL FOURTH QUARTER AND FULL YEAR RESULTS
Net sales from total operations were $483 million for the fourth quarter of 2024, down 6% compared to fourth quarter 2023 net sales of $513 million. Net income from total operations for the fourth quarter of 2024 was $199 million, or $11.91 per diluted share which includes $307 million of gain on sale of the tissue division ($219 million after tax) compared to $18 million for the fourth quarter of 2023, or $1.06 per diluted per share. Adjusted EBITDA from total operations was $21 million in the fourth quarter of 2024, compared to $63 million in the fourth quarter of 2023. The increase in net income was driven by the gain on the sale of our tissue operation, offset by lower sales prices and the planned major maintenance at our Augusta, Georgia facility. The decrease in our total company Adjusted EBITDA was driven by the planned major maintenance at our Augusta, Georgia facility, lower sales prices and the divestiture of our tissue operations on November 1, 2024.
Net sales from total operations were $2.2 billion for 2024, an increase of 6% compared to 2023 net sales of $2.1 billion. Net income for 2024 was $196 million, or $11.70 per diluted share, compared to $108 million for 2023, or $6.30 per diluted share. Adjusted EBITDA from total operations was $182 million for 2024, compared to $281 million for 2023. The increase in net income was driven by the gain on the sale of our tissue operation, offset by lower sales prices. The decrease in our total company Adjusted EBITDA was driven by lower sales prices and higher maintenance costs partially offset by higher sales and production volume due to our acquisition of the Augusta facility.
Sales Volumes and Prices:
• Sales volumes were 306,692 tons in the fourth quarter of 2024, an increase of 63% compared to 188,018 tons in the fourth quarter of 2023. Sales volumes were 1,080,898 tons for the year ended 2024 compared to 751,520 tons for the year ended 2023.
• Paperboard average net selling price decreased 9% to $1,177 per ton for the fourth quarter of 2024, compared to $1,297 per ton in the fourth quarter of 2023. Paperboard average net selling price decreased 12% to $1,210 per ton for the year ended 2024, compared to $1,375 per ton for the year ended 2023.
COMPANY OUTLOOK
“We continue to experience challenging SBS industry conditions, with supply exceeding demand, but we remain optimistic about the future growth prospects of paperboard packaging. We are taking actions to address the resulting near term margin pressure by reducing fixed costs, including eliminating more than 10% of all positions across the company. These combined actions should deliver $30 to $40 million in cost savings in 2025. While our industry is currently in a down cycle, we continue to invest in our assets to ensure that they remain competitive in the long-run,” concluded Kitch.
WEBCAST INFORMATION
Clearwater Paper Corporation will discuss these results during an earnings conference call that begins at 2:00 p.m. Pacific Time on February 13, 2025. 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 CORPORATION
Clearwater Paper is a premier independent supplier of paperboard packaging products to North American converters. Headquartered in Spokane, Washington, our team produces high-quality paperboard that provides sustainable packaging solutions for consumer goods and food service applications. For additional information, please visit our website at www.clearwaterpaper.com.
USE OF NON-GAAP MEASURES
In this press release, the company presents certain non-GAAP financial information for the quarter and years ended December 31, 2024 and 2023, including Adjusted EBITDA from total operations which includes both continuing and discontinued operations and net sales from total operations which includes both continuing and discontinued. 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 from total operations: (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 from total operations to measure the company's compliance with certain covenants.
FORWARD-LOOKING STATEMENTS
This press release contains certain “forward-looking” statements within the meaning of Section 27A of Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995 as amended, including statements regarding: the recent sale of the company’s consumer products division (tissue business); the company’s expectations regarding paperboard demand; the company’s paperboard strategy, including the company’s plans to grow the company’s paperboard business; the company’s expectation that paperboard represents the best opportunity for steady and sustainable value creation; cost structure improvements and cost saving initiatives; the company’s continued investment in the company’s business; and the company’s ability to take advantage of strategic opportunities as they arise. 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: there may be unexpected costs, charges or expenses resulting from the recent tissue business sale transaction, including purchase price adjustments; competitive responses to the recent tissue business sale transaction; achievement of anticipated financial results and other benefits of the recent tissue business sale transaction; potential risks associated with operating without the tissue business, including less diversification in products offered; changes in the company’s capital structure; there may be stockholder litigation in connection with the recent
tissue business sale transaction or the acquisition of the Augusta, Georgia paperboard manufacturing facility or other settlements; the company’s inability to realize the expected benefits of the Augusta, Georgia paperboard manufacturing facility acquisition because of integration difficulties or other challenges; risks relating to the integration of the Augusta, Georgia paperboard manufacturing facility and achievement of anticipated financial results and other benefits of the acquisition; 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 the company’s 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) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Net sales | $ | 387.1 | $ | 268.6 | $ | 1,383.6 | $ | 1,136.0 | |||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
| Cost of sales | 372.4 | 232.7 | 1,307.5 | 935.3 | |||||||||||||||||||
| Selling, general and administrative expenses | 26.7 | 31.4 | 116.7 | 119.4 | |||||||||||||||||||
| Other operating charges, net | 3.7 | 2.1 | 24.0 | 3.2 | |||||||||||||||||||
| Total operating costs and expenses | 402.8 | 266.2 | 1,448.1 | 1,057.9 | |||||||||||||||||||
| Income (loss) from operations | (15.7) | 2.5 | (64.5) | 78.1 | |||||||||||||||||||
| Interest expense, net | (5.3) | (1.6) | (29.2) | (9.5) | |||||||||||||||||||
| Debt retirement costs | (9.1) | (3.1) | (9.1) | (3.1) | |||||||||||||||||||
| Other non-operating expense (income) | 0.7 | (0.2) | 1.8 | 0.1 | |||||||||||||||||||
| Total non-operating expense | (13.6) | (4.8) | (36.6) | (12.5) | |||||||||||||||||||
| Income (loss) from continuing operations before income taxes | (29.3) | (2.3) | (101.1) | 65.6 | |||||||||||||||||||
| Income tax provision (benefit) | (9.7) | 0.2 | (27.1) | 16.9 | |||||||||||||||||||
| Income (loss) from continuing operations | (19.6) | (2.5) | (74.0) | 48.7 | |||||||||||||||||||
| Income from discontinued operations | 4.4 | 26.9 | 73.3 | 78.6 | |||||||||||||||||||
| Gain on sale - discontinued operations | 307.2 | — | 307.2 | — | |||||||||||||||||||
| Income from discontinued operations before income taxes | 311.6 | 26.9 | 380.6 | 78.6 | |||||||||||||||||||
| Income tax provision | 92.8 | 6.7 | 110.2 | 19.6 | |||||||||||||||||||
| Income from discontinued operations | 218.8 | 20.2 | 270.3 | 59.0 | |||||||||||||||||||
| Net income | $ | 199.1 | $ | 17.6 | $ | 196.3 | $ | 107.7 | |||||||||||||||
| Net income per common share: | |||||||||||||||||||||||
| Income (loss) per share from continuing operations - basic | $ | (1.17) | $ | (0.15) | $ | (4.41) | $ | 2.89 | |||||||||||||||
| Income per share from discontinued operations - basic | 13.08 | 1.21 | 16.11 | 3.50 | |||||||||||||||||||
| Net income per share - basic | 11.91 | 1.06 | 11.70 | 6.39 | |||||||||||||||||||
| Income (loss) per share from continuing operations - diluted | (1.17) | (0.15) | (4.41) | 2.85 | |||||||||||||||||||
| Income per share from discontinued operations - diluted | 13.08 | 1.21 | 16.11 | 3.45 | |||||||||||||||||||
| Net income per share - diluted | $ | 11.91 | $ | 1.06 | $ | 11.70 | $ | 6.30 | |||||||||||||||
| Average shares outstanding (in thousands): | |||||||||||||||||||||||
| Basic | 16,724 | 16,638 | 16,781 | 16,863 | |||||||||||||||||||
| Diluted | 16,724 | 16,638 | 16,781 | 17,091 | |||||||||||||||||||
| Clearwater Paper Corporation | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (Unaudited) | ||||||||
| (In millions) | December 31, 2024 | December 31, 2023 | ||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 79.6 | $ | 42.0 | ||||
| Receivables, net | 188.7 | 96.1 | ||||||
| Inventories, net | 258.0 | 161.2 | ||||||
| Other current assets | 19.1 | 17.4 | ||||||
| Current assets of discontinued operations | — | 247.5 | ||||||
| Total current assets | 545.4 | 564.1 | ||||||
| Property, plant and equipment | 2,328.4 | 1,608.6 | ||||||
| Accumulated depreciation and amortization | (1,305.4) | (1,247.9) | ||||||
| Property, plant and equipment, net | 1,023.1 | 360.7 | ||||||
| Goodwill and intangible assets, net | 52.9 | 41.5 | ||||||
| Other assets, net | 57.9 | 47.6 | ||||||
| Long term assets of discontinued operations | — | 657.9 | ||||||
| Total Assets | $ | 1,679.2 | $ | 1,671.8 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current liabilities: | ||||||||
| Current portion of long-term debt | $ | 0.6 | $ | — | ||||
| Accounts payable and accrued liabilities | 319.7 | 195.5 | ||||||
| Current liabilities of discontinued operations | — | 90.5 | ||||||
| Total current liabilities | 320.4 | 286.0 | ||||||
| Long-term debt | 281.6 | 439.9 | ||||||
| Liability for pension and other postretirement employee benefits | 52.5 | 54.5 | ||||||
| Deferred tax liabilities and other long-term obligations | 170.2 | 84.6 | ||||||
| Long term liabilities of discontinued operations | — | 138.1 | ||||||
| Total Liabilities | 824.7 | 1,003.0 | ||||||
| Common stock | — | — | ||||||
| Additional paid-in capital | 11.5 | 14.9 | ||||||
| Treasury stock | (3.3) | — | ||||||
| Retained earnings | 880.8 | 684.5 | ||||||
| Accumulated other comprehensive loss, net of tax | (34.5) | (30.7) | ||||||
| Total Stockholders' Equity | 854.6 | 668.8 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 1,679.2 | $ | 1,671.8 | ||||
| Clearwater Paper Corporation | |||||||||||||||||||||||
| Consolidated Statements of Cash Flows | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
| (In millions) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| Operating Activities | |||||||||||||||||||||||
| Net income | $ | 199.1 | $ | 17.6 | $ | 196.3 | $ | 107.7 | |||||||||||||||
| Adjustments to reconcile net income to net cash flows provided by (used in) operating activities: | |||||||||||||||||||||||
| Depreciation and amortization | 21.5 | 24.7 | 99.8 | 98.6 | |||||||||||||||||||
| Equity-based compensation expense | (1.6) | 3.0 | 5.6 | 9.9 | |||||||||||||||||||
| Deferred taxes | 49.0 | (7.6) | 39.0 | (14.9) | |||||||||||||||||||
| Defined benefit pension and other postretirement employee benefits | (1.0) | (0.5) | (4.2) | (2.0) | |||||||||||||||||||
| Gain on sale of business | (307.2) | — | (307.2) | — | |||||||||||||||||||
| Amortization of deferred debt costs and debt retirement | 9.8 | 3.4 | 11.8 | 4.4 | |||||||||||||||||||
Loss on sale or impairment associated with assets | 0.3 | 0.7 | 1.9 | 2.1 | |||||||||||||||||||
| Changes in operating assets and liabilities, net of acquisitions and divestitures: | |||||||||||||||||||||||
| (Increase) decrease in accounts receivable | 4.2 | (9.2) | (58.1) | (1.3) | |||||||||||||||||||
| (Increase) decrease in inventories | 18.0 | 14.1 | 12.4 | 4.0 | |||||||||||||||||||
| (Increase) decrease in other current assets | (6.0) | (7.8) | (2.5) | 0.8 | |||||||||||||||||||
| Increase (decrease) in accounts payable and accrued liabilities | (19.6) | 25.6 | 70.2 | (21.3) | |||||||||||||||||||
| Other, net | (1.1) | 1.5 | (3.0) | 2.6 | |||||||||||||||||||
| Net cash flows provided by (used in) operating activities | (34.7) | 65.6 | 61.8 | 190.7 | |||||||||||||||||||
| Investing Activities | |||||||||||||||||||||||
| Additions to property, plant and equipment, net | (33.0) | (25.2) | (116.6) | (73.7) | |||||||||||||||||||
| Acquisition of business | (0.4) | — | (708.6) | — | |||||||||||||||||||
| Proceeds from business divestiture | 992.5 | — | 992.5 | — | |||||||||||||||||||
| Net cash flows provided by (used in) investing activities | 959.1 | (25.2) | 167.3 | (73.7) | |||||||||||||||||||
| Financing Activities | |||||||||||||||||||||||
| Borrowings on long-term debt | — | 210.0 | 753.4 | 222.0 | |||||||||||||||||||
| Repayments of long-term debt | (880.2) | (312.9) | (931.1) | (325.6) | |||||||||||||||||||
| Taxes paid related to net share settlement of equity awards | — | — | (4.1) | (4.7) | |||||||||||||||||||
| Repurchases of common stock | (3.9) | (2.8) | (10.0) | (17.9) | |||||||||||||||||||
| Payments for debt issuance costs | (0.7) | (2.9) | (5.6) | (3.1) | |||||||||||||||||||
| Other, net | 4.6 | — | 5.9 | — | |||||||||||||||||||
| Net cash flows used in financing activities | (880.3) | (108.6) | (191.4) | (129.3) | |||||||||||||||||||
| Increase (decrease) in cash, cash equivalents and restricted cash | 44.1 | (68.2) | 37.7 | (12.4) | |||||||||||||||||||
| Cash and cash equivalents at beginning of period | 35.5 | 110.2 | 42.0 | 54.4 | |||||||||||||||||||
| Cash and cash equivalents at end of period | $ | 79.6 | $ | 42.0 | $ | 79.6 | $ | 42.0 | |||||||||||||||
| Clearwater Paper Corporation | |||||||||||||||||
| Reconciliation of Non-GAAP Financial Measures - Total Statement of Operations | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Quarter Ended December 31, 2024 | |||||||||||||||||
| (In millions) | As reported | Discontinued operations | Adjustments | Total Operations | |||||||||||||
| Net sales | $ | 387.1 | $ | 102.1 | $ | (6.4) | a | $ | 482.8 | ||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of sales | 372.4 | 86.9 | (6.4) | a | 452.9 | ||||||||||||
| Selling, general and administrative expenses | 26.7 | 3.4 | 30.1 | ||||||||||||||
| Other operating charges, net | 3.7 | 3.7 | 7.3 | ||||||||||||||
| Gain on sale of discontinued operations | — | (307.2) | (307.2) | ||||||||||||||
| Total operating costs and expenses | 402.8 | (213.2) | 183.1 | ||||||||||||||
| Total income (loss) from operations | (15.7) | 315.3 | 299.7 | ||||||||||||||
| Total non-operating expense | (13.6) | (3.7) | (17.3) | ||||||||||||||
| Total income (loss) from operations before income taxes | (29.3) | 311.6 | 282.3 | ||||||||||||||
| Income tax provision (benefit) | (9.7) | 92.8 | 83.2 | ||||||||||||||
| Total income (loss) from operations | (19.6) | $ | 218.8 | ||||||||||||||
| Income from discontinued operations, net of tax | 218.8 | ||||||||||||||||
| Net income | $ | 199.1 | $ | 199.1 | |||||||||||||
| Quarter Ended December 31, 2023 | |||||||||||||||||
| (In millions) | As reported | Discontinued operations | Adjustments | Total Operations | |||||||||||||
| Net sales | $ | 268.6 | $ | 262.1 | $ | (17.8) | a | $ | 512.9 | ||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of sales | 232.7 | 223.7 | (18.9) | a | 437.5 | ||||||||||||
| Selling, general and administrative expenses | 31.4 | 5.5 | 36.9 | ||||||||||||||
| Other operating charges, net | 2.1 | 0.8 | 2.9 | ||||||||||||||
| Total operating costs and expenses | 266.2 | 228.9 | 477.3 | ||||||||||||||
| Total income from operations | 2.5 | 33.2 | 35.6 | ||||||||||||||
| Total non-operating expense | (4.8) | (6.4) | (11.2) | ||||||||||||||
| Total income (loss) from operations before income taxes | (2.3) | 26.8 | 24.4 | ||||||||||||||
| Income tax provision (benefit) | 0.2 | 6.6 | 6.8 | ||||||||||||||
| Total income (loss) from operations | (2.5) | $ | 20.2 | ||||||||||||||
| Income from discontinued operations, net of tax | 20.2 | ||||||||||||||||
| Net income | $ | 17.6 | $ | 17.6 | |||||||||||||
a - Represents intercompany transactions between the consumer products division and our remaining entity which under discontinued operations reporting requirements are shown as sales.
| Clearwater Paper Corporation | |||||||||||||||||
| Reconciliation of Non-GAAP Financial Measures - Total Statement of Operations | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Twelve Months Ended December 31, 2024 | |||||||||||||||||
| (In millions) | As reported | Discontinued operations | Adjustments | Total Operations | |||||||||||||
| Net sales | $ | 1,383.6 | $ | 870.3 | $ | (44.6) | a | $ | 2,209.4 | ||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of sales | 1,307.5 | 733.0 | (44.5) | a | 1,996.0 | ||||||||||||
| Selling, general and administrative expenses | 116.7 | 26.2 | 142.8 | ||||||||||||||
| Other operating charges, net | 24.0 | 14.4 | 38.4 | ||||||||||||||
| Gain on sale | — | (307.2) | (307.2) | ||||||||||||||
| Total operating costs and expenses | 1,448.1 | 466.4 | 1,870.0 | ||||||||||||||
| Total income (loss) from operations | (64.5) | 404.0 | 339.4 | ||||||||||||||
| Total non-operating expense | (36.6) | (23.4) | (60.0) | ||||||||||||||
| Total income (loss) from operations before income taxes | (101.1) | 380.6 | 279.4 | ||||||||||||||
| Income tax provision (benefit) | (27.1) | 110.2 | 83.1 | ||||||||||||||
| Total income (loss) from operations | (74.0) | $ | 270.3 | ||||||||||||||
| Income from discontinued operations, net of tax | 270.3 | ||||||||||||||||
| Net income | $ | 196.3 | $ | 196.3 | |||||||||||||
| Twelve Months Ended December 31, 2023 | |||||||||||||||||
| (In millions) | As reported | Discontinued operations | Adjustments | Total Operations | |||||||||||||
| Net sales | $ | 1,136.0 | $ | 1,023.4 | $ | (76.6) | a | $ | 2,082.8 | ||||||||
| Costs and expenses: | |||||||||||||||||
| Cost of sales | 935.3 | 892.6 | (76.6) | a | 1,751.3 | ||||||||||||
| Selling, general and administrative expenses | 119.4 | 29.4 | 148.8 | ||||||||||||||
| Other operating charges, net | 3.2 | 2.4 | 5.6 | ||||||||||||||
| Total operating costs and expenses | 1,057.9 | 924.3 | 1,905.6 | ||||||||||||||
| Total income from operations | 78.1 | 99.1 | 177.2 | ||||||||||||||
| Total non-operating expense | (12.5) | (20.5) | (33.0) | ||||||||||||||
| Total income from operations before income taxes | 65.6 | 78.6 | 144.2 | ||||||||||||||
| Income tax provision | 16.9 | 19.6 | 36.5 | ||||||||||||||
| Total income from operations | 48.7 | $ | 59.0 | ||||||||||||||
| Income from discontinued operations, net of tax | 59.0 | ||||||||||||||||
| Net income | $ | 107.7 | $ | 107.7 | |||||||||||||
| Clearwater Paper Corporation | ||||||||||||||||||||||||||||||||||||||||||||
| Reconciliation of Non-GAAP Financial Measures | ||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | ||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||
| (In millions) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 199.1 | $ | 17.6 | $ | 196.3 | $ | 107.7 | ||||||||||||||||||||||||||||||||||||
| Add (deduct): | ||||||||||||||||||||||||||||||||||||||||||||
| Less: Income from discontinued operations, net of tax | 218.8 | 20.2 | 270.3 | 59.0 | ||||||||||||||||||||||||||||||||||||||||
| Income from continuing operations | (19.6) | (2.5) | (74.0) | 48.7 | ||||||||||||||||||||||||||||||||||||||||
| Income tax provision (benefit) | (9.7) | 0.2 | (27.1) | 16.9 | ||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | 5.3 | 1.6 | 29.2 | 9.5 | ||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization expense | 21.5 | 10.3 | 69.8 | 40.6 | ||||||||||||||||||||||||||||||||||||||||
| Inventory revaluation on acquired business | — | — | 6.8 | — | ||||||||||||||||||||||||||||||||||||||||
Other operating charges, net1 | 3.7 | 2.1 | 24.0 | 3.2 | ||||||||||||||||||||||||||||||||||||||||
| Other non-operating expense (income) | (0.7) | 0.2 | (1.8) | (0.1) | ||||||||||||||||||||||||||||||||||||||||
| Debt retirement costs | 9.1 | 3.1 | 9.1 | 3.1 | ||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA from continuing operations | $ | 9.5 | $ | 14.9 | $ | 36.0 | $ | 121.9 | ||||||||||||||||||||||||||||||||||||
| Income from discontinued operations | 218.8 | 20.2 | 270.3 | 59.0 | ||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization included in discontinued operations | — | 14.3 | 30.0 | 57.9 | ||||||||||||||||||||||||||||||||||||||||
| Other operating charges, net included in discontinued operations | 3.7 | 0.8 | 14.4 | 2.4 | ||||||||||||||||||||||||||||||||||||||||
| Inventory adjustment | — | — | 4.3 | — | ||||||||||||||||||||||||||||||||||||||||
| Gain on sale of discontinued operations | (307.2) | — | (307.2) | — | ||||||||||||||||||||||||||||||||||||||||
| Income tax provision included in discontinued operations | 92.8 | 6.7 | 110.2 | 19.6 | ||||||||||||||||||||||||||||||||||||||||
| Non-operating expenses included in discontinued operations | 3.7 | 6.4 | 23.4 | 20.3 | ||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA from total operations | $ | 21.2 | $ | 63.3 | $ | 181.5 | $ | 281.0 | ||||||||||||||||||||||||||||||||||||
1 Other operating charges, net consist of amounts unrelated to ongoing core operating activities. Please refer to Note 10 within Clearwater Paper's Form 10-K filed with the SEC for the year ended December 31, 2024 for the detailed breakout of the annual amount.
| Clearwater Paper Corporation | |||||||||||||||||
| Reconciliation of Non-GAAP Financial Measures | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| December 31, 2024 | September 30, 2024 | December 31, 2023 | |||||||||||||||
| Calculation of net debt: | |||||||||||||||||
| Current portion of long-term debt | $ | 0.6 | $ | 7.4 | $ | — | |||||||||||
| Long-term debt | 281.6 | 1,143.3 | 439.9 | ||||||||||||||
| Add back: | |||||||||||||||||
| Unamortized deferred debt costs | 1.8 | 7.4 | 5.1 | ||||||||||||||
| Less: | |||||||||||||||||
| Cash and cash equivalents | 79.6 | 35.5 | 42.0 | ||||||||||||||
| Net debt | $ | 204.4 | $ | 1,122.6 | $ | 403.0 | |||||||||||
Clearwater Paper Corporation
Investors contact:
Sloan Bohlen
Solebury Strategic Communications
509-344-5906
investorinfo@clearwaterpaper.com
News media:
Virginia Aulin, Vice President, Public Affairs
509-344-5967
Virginia.Aulin@clearwaterpaper.com
Fourth Quarter and Full Year Earnings Release Materials February 13, 2025 ARSEN KITCH President, Chief Executive Officer and Director SHERRI BAKER Senior Vice President and Chief Financial Officer
2 Forward Looking Statements Cautionary Statement Regarding Forward Looking Statements This presentation of supplemental information contains, in addition to historical information, certain “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995 as amended, including statements regarding: the recent sale of our consumer products division (tissue business); the acquisition of the paperboard manufacturing facility and associated business in Augusta, Georgia; the expected impact, benefits and opportunities resulting from the Augusta acquisition; the Company’s intention to focus on growth in paperboard; the Company’s strategic positioning to capitalize on the paperboard industry’s cyclical nature and deliver strong returns; order patterns; product demand and industry trends; production targets; impact of inflation of raw material and energy; assumptions for Q1 2025 and full year 2025, including maintenance outage impacts, operational factors, interest, capital, lower input costs, depreciation and amortization and income tax; our capital allocation priorities; our strategy, including achieving target leverage ratio and maintaining liquidity; our focus on free cash flow generation through operational efficiencies and demand; expectations regarding the paperboard market; inventory management; our financial flexibility; and repurchases under the existing share buyback authorization. These forward-looking statements are based on management’s current expectations, estimates, assumptions and projections that are subject to change. Our actual results of operations may differ materially from those expressed or implied by the forward-looking statements contained in this presentation. Important factors that could cause or contribute to such differences include the risks and uncertainties described from time to time in the Company's public filings with the Securities and Exchange Commission, including but not limited to the following: there may be unexpected costs, charges or expenses resulting from the sale of our tissue business, including potential purchase price adjustments; competitive responses to the tissue business sale; achievement of anticipated financial results and other benefits of the tissue business sale; potential risks associated with operating without the tissue business, including less diversification in products offered; changes in our capital structure; there may be stockholder litigation in connection with the tissue business sale or the acquisition of the Augusta, Georgia paperboard manufacturing facility or other settlements or investigations may result in significant costs of defense, indemnification and liability; our inability to realize the expected benefits of the Augusta, Georgia paperboard manufacturing facility acquisition because of integration difficulties or other challenges; risks relating to the integration of the Augusta, Georgia paperboard manufacturing facility and achievement of anticipated financial results and other benefits of the acquisition; competitive pricing pressures for our products, including as a result of capacity additions, demand reduction and the impact of foreign currency fluctuations on the pricing of products globally; 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 freight costs and disruptions in transportation services impacting our ability to receive inputs or ship products to customers; changes in customer product preferences and competitors' product offerings; larger competitors having operational, financial and other advantages; consolidation and vertical integration of converting operations in the paperboard industry; changes in the U.S. and international economies and in general economic conditions in the regions and industries in which we operate; manufacturing or operating disruptions, including equipment malfunctions and damage to our manufacturing facilities; cyber-security risks; our ability to successfully execute capital projects and other activities to operate our assets, including effective maintenance, implement our operational efficiencies and realize higher throughput or lower costs; IT system disruptions and IT system implementation failures; labor disruptions; cyclical industry conditions, including the shifting supply and demand balance; changes in expenses, required contributions and potential withdrawal costs associated with our pension plans; environmental liabilities or expenditures and climate change; reliance on a limited number of third-party suppliers, vendors and service providers required for the production of our products and our operations; our ability to attract, motivate, train and retain qualified and key personnel; our ability to service our debt obligations and restrictions on our business from debt covenants and terms; changes in our banking relations, or in our customer supply chain financing; negative changes in our credit agency ratings; and changes in laws, regulations or industry standards affecting our business. Forward-looking statements contained in this presentation present management’s views only as of the date of this presentation. We undertake no obligation to publicly update forward-looking statements or to retract future revisions of management's views based on events or circumstances occurring after the date of this presentation. Non-GAAP Financial Measures This presentation includes certain financial measures that are not calculated in accordance with GAAP, including Adjusted EBITDA from both continuing and discontinued operations. The Company’s management believes that the presentation of these financial measures provides useful information to investors because these measures are regularly used by management in assessing the Company’s performance. These financial measures should be considered in addition to results prepared in accordance with GAAP but should not be considered substitutes for or superior to GAAP results. In addition, these non-GAAP financial measures may not be comparable to similarly-titled measures utilized by other companies, since such other companies may not calculate such measure in the same manner as we do. A reconciliation of Adjusted EBITDA to the most relevant GAAP measure is available in the appendix of this presentation.
3 Utilized ~$850 million of net proceeds from sale to pay down debt Completed sale of tissue business for $1.06 billion on November 1 Completed acquisition of Augusta paperboard mill for $700M on May 1 LIGHTWEIGHT PRODUCTS Increased total SBS capacity to ~1.4M tons Balanced network to deliver lower landed costs and targeting synergies of $40-50M by end of 2026 2024 Was a Transformational Year For Clearwater Paper $100 million share repurchase authorization approved Launched and executed a new share repurchase program Repurchased ~$9M of shares through February 7, 2025 since new program launch on Nov 1 Transforming Clearwater into a leading paperboard packaging supplier Strengthened our position as a premier, independent supplier of paperboard packaging products to North American converters A strong balance sheet with 1-2x net leverage ratio target across cycle Paid down all credit facilities, except $275 million of 2028 notes with an interest rate of 4.75% 1. Subject to customary adjustments 1
4 Clearwater is Well Positioned to Deliver Strong Returns Across the Cycle >16% Cycle peak (>95% utilization, 50-60% FCF conversion) Average across cycle (90-95% utilization, 40-50% FCF conversion) ~13 to 14% Downcycle (<85% utilization, 0-20% FCF conversion) <10% TARGETING STRONG CASH FLOW GENERATION ACROSS THE CYCLE Across the cycle Adjusted EBITDA margins target of 13% to 14% Delivering a 40-50% Adjusted EBITDA to free cash flow conversion rate1, or $100M+ per year Paperboard industry is cyclical, driven by supply and demand balance Currently in downcycle as new capacity is added ahead of demand recovery Near-term focus on reducing fixed cost structure by $30-40M in 2025 Continued investment in assets to enhance competitiveness Exploring growth opportunities to expand product offering through internal investments or acquisitions Strong balance sheet to sustain the business and create strategic options across the cycle Clearwater is focused on value creation across the cycle 1. Cash flow from operating activities adjusted for other operating charges less capital, divided by Adjusted EBITDA ADJUSTED EBITDA TARGET MARGINS
5 Optimized Capital Allocation Approach Supports Value Creation $70-80M EXPECTED ANNUAL MAINTENANCE CAPEX, EXCLUDING LARGE REPLACEMENT PROJECTS 1-2x TARGET LEVERAGE RATIO Investing to maintain the long-term performance of our assets Evaluating capital investments to diversify product portfolio Opportunistic M&A to support strategic priorities Return capital to shareholders through share buybacks Utilizing free cash flow (FCF) to deleverage our balance sheet
6 INDUSTRY TRENDS 1. Based on data from AF&PA. 2. Based on data reported by RISI Fastmarkets and other industry sources. SBS PAPERBOARD SHIPMENTS IMPROVED IN 2024, PROJECTED TO GROW IN 2025 Industry shipments1 up 4% FY 2024 vs. FY 2023 Shipments projected to grow by 3 to 5%2 in 2025 Domestic demand expected to recover to pre-COVID levels by end of 2025 UTILIZATION RATES IMPROVED IN 2024, BUT REMAINED BELOW THE CROSS CYCLE AVERAGE Industry operating rates1 at 85% FY 2024 vs. 82% FY 2023 N.A. capacity2 remained largely unchanged at ~5.4M tons New industry capacity being added in 2025 Balanced market will have utilization rates between 90 and 95% BLEACHED PAPERBOARD IMPORTS INCREASED IN 2024, WHILE EXPORTS DECREASED Imports increased by ~119K tons to ~628K tons2 in 2024 Exports decreased by ~136K tons to ~855K tons2 in 2024 Driven by increased global supply
7 +44% FY increase in shipments Primarily due to Augusta acquisition -12% FY decrease in paperboard pricing Consistent with industry trends FY 2024 Financial Summary NET SALES FROM TOTAL1 OPERATIONS $2.2B FY NET SALES FROM CONTINUING OPERATIONS $1.4B FY OFFSET BY MARKET DRIVEN PRICING DECREASE NET INCOME FROM TOTAL1 OPERATIONS $196M FY ADJUSTED EBITDA FROM TOTAL1 OPERATIONS $182M FY ADJUSTED EBITDA FROM CONTINUING OPERATIONS $36M FY FY ADJUSTED EBITDA FROM TOTAL OPERATIONS AT $182M Down from $281M in 2023, impacted primarily by lower paperboard pricing SIGNIFICANT VALUE FROM TISSUE DIVESTITURE Gain of $307M recognized in Q4 Reduced net debt by $199 million, net leverage ratio 1.1x at year-end 1. Our former tissue operations are reflected as discontinued operations, and our paperboard operations plus corporate expenses are reflected as continuing operations. Total operations includes both continuing and discontinued operations. SIGNIFICANT GROWTH IN PAPERBOARD SALES VOLUME 1
8 FY’24 VS FY’23 Adjusted EBITDA Results from Total Operations ($ in millions) $281.0 -$13.6 -$28.0 $1.3 $181.5 -$90.3 $31.1 FY'23 Adj. EBITDA Tissue Price/Mix Volume Costs/Other SG&A FY'24 Adj. EBITDA Lower market pricing as reported by RISI Higher sales and production, primarily from Augusta acquisition Higher maintenance outage costs including Augusta, impact from weather events, partially offset by lower input costs Sale completed Nov 1 ‘24 1 1. Total operations includes both continuing and discontinued operations.
9 +63% in Q4 Primarily due to Augusta acquisition -9% in Q4 decrease in paperboard pricing Consistent with industry trends Q4 2024 Financial Summary NET SALES FROM TOTAL OPERATIONS $483M Q4 NET SALES FROM CONTINUING OPERATIONS $387M Q4 OFFSET BY MARKET DRIVEN PRICING DECREASE NET INCOME FROM TOTAL OPERATIONS $199M Q4 ADJUSTED EBITDA FROM TOTAL OPERATIONS $21M Q4 ADJUSTED EBITDA FROM CONTINUING OPERATIONS $10M Q4 ADJUSTED EBITDA FROM TOTAL OPERATIONS AT $21M Impacted by lower pricing, Hurricane Helene, and a planned major maintenance outage at the Augusta, GA mill SIGNIFICANT VALUE FROM TISSUE DIVESTITURE Gain of $307M recognized in Q4 Reduced net debt by $918 million, net leverage ratio 1.1x at year-end 1. Our former tissue operations are reflected as discontinued operations, and our paperboard operations plus corporate expenses are reflected as continuing operations. Total operations includes both continuing and discontinued operations. SIGNIFICANT GROWTH IN PAPERBOARD SALES VOLUME 1 1 1 1
10 Q4’24 VS Q4’23 Adjusted EBITDA Results from Total Operations ($ in millions) $63.3 -$36.3 -$8.4 $3.2 $21.2 -$11.5 $10.9 Q4'23 Adj. EBITDA Tissue Price/Mix Volume Costs/Other SG&A Q4'24 Adj. EBITDA Lower market pricing as reported by RISI Sale completed Nov 1 ‘24 Higher maintenance outage costs, including Augusta, and hurricane impact partially offset by lower input costs Higher sales and production, primarily from Augusta acquisition 1. Total operations includes both continuing and discontinued operations. 1
11 Outlook and Assumptions for Q1 and Full Year 2025 Q1 2025: $20 to $30M of Adjusted EBITDA1 No major maintenance outages planned Higher seasonal energy usage and costs Balancing supply to meet demand Action taken to reduce fixed costs, including a 10% reduction in all positions across company FY 2025 Assumptions Capacity utilization at ~85%, with approximately $1.5 to $1.6B of revenue Full year benefit of incremental Augusta sales volume Improved mill operating performance offsetting lower pricing and inflation Less impact from weather related events and other operational disruptions $30-40M fixed cost reduction in 2025, $40-50M annual run rate benefit $40-50M of total direct major maintenance cost (Q2 Cypress Bend, Q3 Lewiston, Q4 Augusta) $80-90M of capital expenditures, including large project carryover spend 1. As there is uncertainty in connection with calculating the adjustments necessary to prepare reconciliations from Adjusted EBITDA to the comparable GAAP financial measure, the Company is unable to reconcile the Adjusted EBITDA projections without unreasonable efforts. Therefore, no reconciliation is being provided at this time. These items could result in significant adjustments from the most comparable GAAP measure.
12 Optimistic About Long-Term Value Creation • Meaningfully de-levered balance sheet with proceeds from sale • Focus on growing our position as a premier independent paperboard packaging supplier to North American converters Sale of our tissue business enables sharpened focus on improving and growing our paperboard business • High quality paperboard assets well positioned across the U.S. to efficiently service North American converters • Strong legacy of prioritizing sustainability • Focused on expanding product portfolio through internal investment and opportunistic M&A Well invested asset base to support future growth • Driving improvement in operational performance • Consistently investing to maintain competitiveness of our assets • Strategically deploy capital to create long-term shareholder value Focused on optimizing business to deliver free cash flows
13 Appendix
14 FINANCIAL PERFORMANCE ($ IN MILLIONS, EXCEPT PER SHARE INFORMATION) (In millions) As reported Discontinued operations Adjustments Total Operations As reported Discontinued operations Adjustments Total Operations Net sales $ 387.1 $ 102.1 $ (6.4) $ 482.8 $ 1,383.6 $ 870.3 $ (44.6) $ 2,209.4 Costs and expenses: Cost of sales 372.4 86.9 (6.4) 452.9 1,307.5 728.7 (44.5) 1,991.8 Selling, general and administrative expenses 26.7 3.4 30.1 116.7 30.4 147.1 Other operating charges, net 3.7 3.7 7.4 24.0 14.4 38.4 Gain on sale - (307.2) (307.2) - (307.2) (307.2) Total operating costs and expenses 402.8 (213.2) 183.1 1,448.1 466.4 1,870.0 Total income (loss) from operations (15.7) 315.3 299.7 (64.5) 404.0 339.4 Total non-operating expense (13.6) (3.7) (17.3) (36.6) (23.4) (60.0) Total income (loss) from operations before income taxes (29.3) 311.6 282.3 (101.1) 380.6 279.4 Income tax provision (benefit) (9.7) 92.8 83.2 (27.1) 110.2 83.1 Total income (loss) from operations (19.6) 218.8 (74.0) 270.3 Income from discontinued operations, net of tax 218.8 270.3 Net income $ 199.1 $ 199.1 $ 196.3 $ 196.3 (Unaudited) Twelve Months Ended December 31, 2024 Quarter Ended December 31, 2024
15 Reconciliation of Adjusted EBITDA ($ IN MILLIONS) (In millions) 2024 2023 2024 2023 Net income (loss) $ 199.1 $ 17.6 $ 196.3 $ 107.7 Add (deduct): Less: Income from discontinued operations, net of tax 218.8 20.2 270.3 59.0 Income from continuing operations (19.7) (2.5) (74.0) 48.7 Income tax provision (benefit) (9.7) 0.2 (27.1) 16.9 Interest expense, net 5.3 1.6 29.2 9.5 Depreciation and amortization expense 21.5 10.3 69.8 40.6 Inventory revaluation on acquired business - - 6.8 - Other operating charges, net1 3.7 2.1 24.0 3.2 Other non-operating expense (income) (0.7) 0.2 (1.8) (0.1) Debt retirement costs 9.1 3.1 9.1 3.1 Adjusted EBITDA from continuing operations 9.5 14.9 36.0 121.9 Income from discontinued operations 218.8 20.2 270.3 59.0 Depreciation and amortization - 14.3 30.0 57.9 Other operating charges 3.7 0.8 14.4 2.4 inventory adjustment - - 4.3 - Gain on sale of discontinued operations (307.2) - (307.2) - Income tax provision included in discontinued 92.8 6.7 110.2 19.6 Non-operating expenses included in discontinued 3.7 6.4 23.4 20.3 Adjusted EBITDA from total operations $ 21.2 $ 63.3 $ 181.5 $ 281.0 Three Months Ended December 31, Twelve Months Ended December 31,
16 Q3’24 VS Q4’24 Adjusted EBITDA Results from Total Operations ($ in millions) $63.5 -$31.6 -$17.7 $5.4 $21.2 -$2.9 $4.5 Q3'24 Adj. EBITDA Tissue Price/Mix Volume Costs/Other SGA Q4'24 Adj. EBITDA Higher production volume Higher planned major maintenanceLess favorable sales mix Sale completed Nov 1 ‘24 1. Total operations includes both continuing and discontinued operations. 1