Rayonier Advanced Materials reports Q2 EPS (24c), two estimates (12c)

Reports Q2 revenue $385M, two estimates $417.63M. “Results for the second quarter reflected shifting market conditions across several key end markets. Despite facing volume pressure due to destocking in certain areas of our Cellulose Specialties and Paperboard businesses, we successfully increased prices by 13 percent and 4 percent, respectively, from the previous year, demonstrating our commitment to prioritizing value over volume. Moreover, we are experiencing downward pressure on commodity prices across all our segments, which intensified during the quarter. We are reacting by taking downtime at our High-Yield Pulp plant to reduce costs, minimize losses and monetize inventories. We are also reviewing strategic options with respect to our non-fluff High Purity Cellulose commodity businesses, specifically including viscose and paper pulp products,” said De Lyle W. Bloomquist, RYAM‘s President and Chief Executive Officer. “Consequently, we are revising down our 2023 Adjusted EBITDA guidance, but raising our free cash flow guidance as we reduce capital expenditures and monetize additional working capital. The lower EBITDA guidance is driven primarily by a softer outlook for commodity pricing and lower sales volumes in Cellulose Specialties and Paperboard. Overall, reductions in commodity prices are impacting our 2023 EBITDA guidance by approximately $45 million, which we expect to partially offset with proactive cost reduction measures of nearly $40 million that is expected to be realized in the second half of the year.”