Clearwater Paper Corporation has reported strong third quarter results despite increased inflation across key cost categories.
The company reported a 2% net sales decrease year-on-year to $450m for the quarter and a net income of $2m.
Adjusted EBITDA for the quarter was $50m compared to the third quarter of 2020’s $77m.
Arsen Kitch, President and Chief Executive, said: “We exceeded our expectations in the third quarter with higher tissue demand, continued strength in our paperboard business, and solid operational execution.
“Our performance improved relative to the second quarter with higher paperboard pricing, greater tissue volumes, and lower planned major maintenance outage expense, partly offset by increased inflation pressure.”
A spokesperson for Clearwater confirmed to TWM that the company will adjust downtime as needed across its tissue sites, including Lewiston, Shelby, North Carolina, Las Vegas, and Elwood, Illinois: “There is a degree of uncertainty in consumer and retailer behaviour right now, pertaining to the tissue business.
“We will continue to align sales demand and production as needed to manage inventories and our cost structure, and meet customer demand.
“We are seeing improving trends in tissue orders and shipments, and are optimistic that our tissue business will generate meaningful cash flows in the long run.”
For the first nine months of 2021, Clearwater Paper reported net sales of $1.3bn, a 9% decrease year-on-year compared to net sales of $1.4bn.
Net loss for the first nine months of 2021 was $38m compared to a net income for the first nine months of 2020 of $55m.
Adjusted EBITDA for the first nine-month period was $119m compared with $211m a year earlier.
Net sales in the Pulp and Paperboard products segment were $237m for the third quarter, up 9% year-on-year.
For the first nine months of 2021, net sales in the Pulp and Paperboard products segment were up 4% to $685m.
Net sales for the quarter in the Consumer Products segment were $214m, down 13%.
Segment operating income for the third quarter of 2021 was $4m compared to $32m in the third quarter of 2020.
This was driven by higher input costs due to inflation and lower sales volume as Covid demand impacts lessened.
Retail tissue volumes sold were 76,237 tonnes in the third quarter of 2021, a decrease of 12% compared to 86,292 tonnes in the third quarter of 2020.
In the first nine months of 2021, retail tissue volumes sold were 208,496 tonnes, a decrease of 23% compared to 272,515 tonnes in the first nine months of 2020.
Selling prices for the segment decreased 1% to $2,732 per tonne in the third quarter of 2021, compared to $2,766 per tonne in the third quarter of 2020.
