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Dec 31, 2023
Rayonier AM Q4 2023 Earnings Report
Rayonier AM's financial performance was impacted by soft demand and strategic cost-cutting measures.
Key Takeaways
Rayonier Advanced Materials Inc. reported a net loss of $102 million for 2023, impacted by soft demand for cellulose ethers, lower paperboard demand, and weak pricing in high-yield pulp. The company responded with cost-cutting measures and market-driven downtime, focusing on free cash flow generation and debt covenant compliance.
Net sales for 2023 were $1,643 million, a decrease of $74 million year-over-year.
The company reported a net loss of $102 million, or $(1.57) per diluted share, for the year ended December 31, 2023.
Adjusted EBITDA for 2023 was $139 million.
The company generated $53 million of free cash flow and remained in compliance with its debt covenants.
Rayonier AM
Rayonier AM
Rayonier AM Revenue by Segment
Revenue by Segment
Paperboard Revenue
CapyFin.comHigh-Yield Pulp Revenue
CapyFin.com Forward Guidance
Rayonier Advanced Materials anticipates improved results for 2024, projecting an Adjusted EBITDA of $180 to $200 million and free cash flow of $20 to $40 million.
Positive Outlook
- Higher pricing for key cellulose specialties products
- Lower unit production costs for the High Purity Cellulose business
- Improved productivity and lower key input and logistics costs
- Commencement of operations at the new bioethanol facility in Q1 2024
- Improved results from Paperboard and High-Yield Pulp due to lower costs and higher production
Challenges Ahead
- Paperboard prices in 2024 are expected to decrease slightly as compared to the fourth quarter of 2023
- Raw material prices are expected to increase as purchased pulp prices are forecast to increase from fourth quarter 2023 levels for Paperboard
- Corporate costs are expected to be flat or increase slightly in 2024 as the Company completes the final year of its multi-year ERP implementation.
- Acetate is expected to experience moderate destocking
- Ethers volumes are anticipated to improve albeit at lower than historical levels
Revenue & Expenses
Visualization of income flow from segment revenue to net income