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Jun 30, 2024
Sylvamo Q2 2024 Earnings Report
Sylvamo's Q2 2024 earnings exceeded expectations, driven by favorable price and mix, and improved operational efficiency.
Key Takeaways
Sylvamo reported a net income of $83 million, or $1.98 per diluted share, and an adjusted EBITDA of $164 million. The company benefited from improved price and mix, volume increases in Latin America, and lower operating costs.
Net income reached $83 million ($1.98 per diluted share) compared to $43 million ($1.02 per diluted share) in the previous quarter.
Adjusted EBITDA totaled $164 million (18% margin) versus $118 million (13% margin) in the first quarter.
Cash from operating activities was $115 million, a significant increase from $27 million in the prior quarter.
Free cash flow improved to $62 million from $(33) million in the first quarter.
Sylvamo
Sylvamo
Sylvamo Revenue by Segment
Sylvamo Revenue by Geographic Location
Revenue by Segment
Europe Revenue
CapyFin.comLatin America Revenue
CapyFin.comNorth America Revenue
CapyFin.comRevenue by Geographic Location
Europe Revenue
CapyFin.comLatin America Revenue
CapyFin.comNorth America Revenue
CapyFin.com Forward Guidance
Sylvamo anticipates an adjusted EBITDA between $170 million and $185 million for the third quarter of 2024.
Positive Outlook
- Volume is projected to increase by $10 million to $15 million, driven by Latin America and North America
- Total planned maintenance outage expenses are expected to decrease by $28 million
- Company refinanced long-term debt to extend debt maturity and take advantage of favorable financing market
- Board of directors declared a 50% dividend increase for the third quarter from $0.30 per share to $0.45 per share
- Company is on target to achieve run rate savings of $110 million by the end of 2024.
Challenges Ahead
- Price and mix are expected to be slightly unfavorable up to $5 million due to mix
- Operations and other costs are expected to increase by $10 million to $15 million due primarily to higher unabsorbed fixed costs from economic downtime
- Input and transportation costs are projected to increase by $5 million to $10 million due to fiber in Latin America and energy in North America
- Uncoated freesheet conditions improved in the first half of the year, with year-over-year demand down slightly in Latin America.
- Company continues to develop a pipeline of more than $200 million of high-return capital projects, which will allow company to grow earnings and cash flows as company reinvests in business in the coming years.
Revenue & Expenses
Visualization of income flow from segment revenue to net income