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Dec 31, 2021
Sylvamo Q4 2021 Earnings Report
Sylvamo released fourth-quarter results with strong earnings and cash flow.
Key Takeaways
Sylvamo reported strong fourth-quarter earnings with adjusted EBITDA of $170 million and free cash flow of $162 million. The company used the cash flow to reduce debt by $124 million and increase cash on hand by $48 million.
Net income was $62 million ($1.41 per diluted share).
Adjusted operating earnings (non-GAAP) were $75 million ($1.71 per diluted share).
Adjusted EBITDA (non-GAAP) was $170 million (17.5% margin).
Free cash flow (non-GAAP) was $162 million.
Sylvamo
Sylvamo
Sylvamo Revenue by Segment
Sylvamo Revenue by Geographic Location
Forward Guidance
Sylvamo projects first-quarter adjusted EBITDA of $180 to $190 million and adjusted operating earnings per share of $1.70 to $1.90.
Positive Outlook
- Price and mix are expected to improve by $35 to $40 million compared to the fourth quarter, reflecting continued realization of prior price increases in all regions
- Maintenance outage expenses are projected to decrease by $31 million, reflecting fewer outages during the winter months in the northern hemisphere.
- Global industry demand continued to recover and we expect this to continue in 2022 as more white-collar workers return to their offices.
- In the first quarter, we expect price and mix to further improve, reflecting continued realization of prior price increases in all three regions and our focus on commercial excellence.
- Our mills ran well and we executed extensive maintenance outages in our Eastover and Saillat mills safely, efficiently and on budget.
Challenges Ahead
- Volume is expected to be down by $13 to $18 million, reflecting seasonally weaker demand in Latin America and Eastern Europe
- Operations and costs are expected to increase by $18 to $20 million, reflecting the non-repeat of $7 million favorable overhead benefits and environmental credits in Europe and a $10 million favorable North America LIFO adjustment, both in the fourth quarter
- Input and transportation costs are projected to increase by $18 to $23 million due to higher fiber, chemicals and transportation costs
- We also project $8 million in costs related to transition service agreements in the quarter
- We also project $15 million of one-time costs
Revenue & Expenses
Visualization of income flow from segment revenue to net income