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Sep 24, 2022
Rayonier AM Q3 2022 Earnings Report
Reported strong financial results driven by increased productivity and higher prices across all segments, partially offset by inflation.
Key Takeaways
Rayonier Advanced Materials Inc. reported net income of $30 million for Q3 2022, a significant improvement compared to a net loss of $5 million in the same quarter of the prior year. Adjusted EBITDA from continuing operations increased by 106 percent to $68 million. The company has increased its full year Adjusted EBITDA guidance to exceed $175 million for 2022.
Net sales for the third quarter were $466 million, up 25 percent from the prior year quarter.
Income from continuing operations for the third quarter was $18 million.
Adjusted EBITDA from continuing operations was $68 million, up 106 percent from the prior year quarter.
Higher prices across all segments were partially offset by inflation on key input costs.
Rayonier AM
Rayonier AM
Rayonier AM Revenue by Segment
Revenue by Segment
Paperboard Revenue
CapyFin.comHigh-Yield Pulp Revenue
CapyFin.com Forward Guidance
The Company updated its Adjusted EBITDA guidance to exceed $175 million for 2022, subject to ongoing supply chain constraints. Additionally, the Company remains on track to reduce its net debt level to $725 million by the end of the year.
Positive Outlook
- Paperboard prices are expected to remain elevated in the fourth quarter driven by strong demand in both the commercial printing and packaging end-use markets.
- Sales volumes and raw material costs are expected to remain steady for Paperboard.
- Paperboard is anticipated to deliver another solid quarter of Adjusted EBITDA.
- Realized prices for High-Yield Pulp are still expected to increase in the fourth quarter.
- Sales volumes for High-Yield Pulp are anticipated to increase significantly as production and logistics constraints improve.
Challenges Ahead
- Demand for cellulose specialties and commodity products remains strong albeit somewhat tempered as global economic growth slows.
- Average sales prices are expected to be down modestly in the fourth quarter driven by a greater mix of commodity sales volumes as production and logistics constraints improve for High Purity Cellulose.
- Key raw material inflation is expected to remain elevated for High Purity Cellulose.
- Adjusted EBITDA for the High Purity Cellulose segment is expected to be down slightly compared to the third quarter.
- High-yield pulp markets appear to be peaking as global economic demand slows.
Revenue & Expenses
Visualization of income flow from segment revenue to net income