Clearwater Paper Reports First Quarter 2026 Results
FIRST QUARTER HIGHLIGHTS
-
Net sales of
$360 million versus$378 million in the first quarter of 2025, with volume up 5%, offset by lower market pricing -
Net loss of
$13 million , or$0.80 per diluted share versus net loss of$6 million , or$0.38 per diluted share in the first quarter of 2025 -
Adjusted EBITDA from continuing operations of
$2 million versus$30 million in the first quarter of 2025 primarily due to lower market pricing and severe weather impacts - Launched Velora™a new lightweight folding carton paperboard engineered to deliver dependable performance, higher yield and strong value for everyday packaging
-
Announced restructuring of Cypress Bend,
Arkansas facility in April, resulting in reduction of approximately 20% of roles and expected annual savings of$8 to$12 million -
Received
$17 million in additional representation and warranty insurance proceeds, pursuing claims against$50 million of remaining policy limit
“We delivered solid operational execution during the first quarter, with our team doing an outstanding job managing through a severe weather event in the Southeast. We also delivered healthy volume growth that outpaced the market even as we navigated a challenging industry environment,” said
OVERALL RESULTS
For the first quarter of 2026,
The increase in net loss was primarily driven by lower pricing and the impact of a weather event during the first quarter of 2026, partially offset by insurance proceeds and cost reductions. The decrease in Adjusted EBITDA primarily reflects lower pricing and weather‑related impacts, partially offset by reduced costs.
Sales volumes and prices:
- Sales volumes were 302,918 tons in the first quarter of 2026, an increase of 5% compared to 289,487 tons in the first quarter of 2025.
-
Paperboard average net selling price decreased 7% to
$1,101 per ton for the first quarter of 2026, compared to$1,188 per ton in the first quarter of 2025.
COMPANY OUTLOOK
“We are focused on items within our control, namely reducing costs and maintaining share with our strategic customers, while anticipating an improvement in industry conditions. Today’s operating rates and recent increases in input costs are resulting in margins and cash flows that do not support long-term investments in our industry’s capital-intensive assets. We believe that a combination of demand growth, lower imports, and changes in net domestic supply will drive a recovery in the medium term,” concluded Kitch.
WEBCAST INFORMATION
ABOUT
USE OF NON-GAAP MEASURES
In this press release, the company presents certain non-GAAP financial information for the first quarter of 2026 and 2025, including adjusted net income (loss) from continuing operations and Adjusted EBITDA from continuing operations. Because these amounts are not in accordance with GAAP, reconciliations to net income (loss) from continuing operations and Adjusted EBITDA from continuing operations as determined in accordance with GAAP are included in the tables at the end of this press release. The company presents these non-GAAP metrics because management believes they assist investors and analysts in comparing the company's performance across reporting periods on a consistent basis by excluding items that the company does not believe are indicative of its core operating performance. In addition, the company uses Adjusted EBITDA from continuing operations: (i) as a factor in evaluating management’s performance when determining incentive compensation, (ii) to evaluate the effectiveness of the company's business strategies, and (iii) because the company's credit agreement and the indentures governing the company's outstanding notes use metrics similar to Adjusted EBITDA from continuing operations to measure the company's compliance with certain covenants. Non-GAAP measures may differ from similarly titled measures of other companies.
FORWARD-LOOKING STATEMENTS
This press release contains certain “forward-looking” statements within the meaning of Section 27A of Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995 as amended, including statements regarding the company’s expectations about the outlook for the next quarter, industry supply and demand conditions, pricing trends, market recovery timing, operating performance, cost reduction initiatives, restructuring outcomes, insurance recoveries, operational execution, import conditions, market share, and the company’s ability to execute its strategy and strengthen customer relationships amid current market conditions. The company’s actual results of operations may differ materially from those expressed or implied by the forward-looking statements contained in this press release. Factors that could cause or contribute to such material differences in actual results include, but are not limited to: our inability to realize the expected benefits of the
|
|
||||||
|
Consolidated Statements of Operations |
||||||
|
(Unaudited) |
||||||
|
|
|
|||||
|
|
Quarter Ended |
|||||
|
(In millions, except per-share data) |
|
2026 |
|
|
2025 |
|
|
Net sales |
$ |
360.3 |
|
$ |
378.2 |
|
|
Costs and expenses: |
|
|
||||
|
Cost of sales |
|
361.2 |
|
|
341.5 |
|
|
Selling, general and administrative expenses |
|
20.6 |
|
|
28.9 |
|
|
Other operating charges, net 1 |
|
(11.1 |
) |
|
11.8 |
|
|
Total operating costs and expenses |
|
370.7 |
|
|
382.2 |
|
|
Loss from continuing operations |
|
(10.4 |
) |
|
(4.0 |
) |
|
Interest expense, net |
|
(5.0 |
) |
|
(3.3 |
) |
|
Other non-operating expense |
|
(1.1 |
) |
|
(0.3 |
) |
|
Total non-operating expense |
|
(6.1 |
) |
|
(3.6 |
) |
|
Loss from continuing operations before income taxes |
|
(16.5 |
) |
|
(7.7 |
) |
|
Income tax benefit |
|
(3.7 |
) |
|
(1.8 |
) |
|
Loss from continuing operations |
|
(12.8 |
) |
|
(5.9 |
) |
|
Loss from discontinued operations, net of tax |
|
— |
|
|
(0.4 |
) |
|
Net loss |
$ |
(12.8 |
) |
$ |
(6.3 |
) |
|
|
|
|
||||
|
Net loss per common share (basic and diluted): |
|
|||||
|
Loss per share from continuing operations |
$ |
(0.80 |
) |
$ |
(0.36 |
) |
|
Loss per share from discontinued operations |
|
— |
|
|
(0.02 |
) |
|
Net loss per share |
$ |
(0.80 |
) |
$ |
(0.38 |
) |
|
|
|
|
||||
|
Average shares outstanding (in thousands): |
||||||
|
Basic and diluted |
|
16,080 |
|
|
16,375 |
|
|
1 Other operating charges, net consist of amounts unrelated to ongoing core operating activities. Please refer to Note 11 within |
||||||
|
|
||||||
|
Condensed Consolidated Balance Sheets |
||||||
|
(Unaudited) |
||||||
|
|
|
|
||||
|
(In millions) |
|
|
||||
|
Assets |
|
|
||||
|
Current assets: |
|
|
||||
|
Cash and cash equivalents |
$ |
36.5 |
|
$ |
30.7 |
|
|
Receivables, net |
|
197.9 |
|
|
195.3 |
|
|
Inventories, net |
|
269.7 |
|
|
281.7 |
|
|
Other current assets |
|
18.0 |
|
|
18.3 |
|
|
Total current assets |
|
522.1 |
|
|
526.0 |
|
|
Property, plant and equipment |
|
2,384.9 |
|
|
2,377.9 |
|
|
Accumulated depreciation and amortization |
|
(1,398.5 |
) |
|
(1,376.1 |
) |
|
Property, plant and equipment, net |
|
986.4 |
|
|
1,001.8 |
|
|
Other assets, net |
|
61.2 |
|
|
60.4 |
|
|
Total assets |
$ |
1,569.8 |
|
$ |
1,588.3 |
|
|
|
|
|
||||
|
Liabilities and stockholders' equity |
|
|
||||
|
Current liabilities: |
|
|
||||
|
Current portion of long-term debt |
$ |
0.6 |
|
$ |
0.6 |
|
|
Accounts payable and accrued liabilities |
|
199.8 |
|
|
215.6 |
|
|
Total current liabilities |
|
200.4 |
|
|
216.2 |
|
|
Long-term debt |
|
360.5 |
|
|
345.5 |
|
|
Liability for pension and other postretirement employee benefits |
|
49.2 |
|
|
49.5 |
|
|
Deferred tax liabilities |
|
64.6 |
|
|
68.2 |
|
|
Other long-term obligations |
|
81.3 |
|
|
83.7 |
|
|
Total liabilities |
|
756.0 |
|
|
763.0 |
|
|
|
|
|
||||
|
Stockholders' equity: |
|
|
||||
|
Common stock |
|
— |
|
|
— |
|
|
Additional paid-in capital |
|
6.0 |
|
|
8.3 |
|
|
|
|
(11.8 |
) |
|
(14.8 |
) |
|
Retained earnings |
|
849.4 |
|
|
862.3 |
|
|
Accumulated other comprehensive loss, net of tax |
|
(29.9 |
) |
|
(30.5 |
) |
|
Total stockholders' equity |
|
813.8 |
|
|
825.3 |
|
|
Total liabilities and stockholders' equity |
$ |
1,569.8 |
$ |
1,588.3 |
||
|
|
||||||
|
Consolidated Statements of Cash Flows |
||||||
|
(Unaudited) |
||||||
|
|
Quarter Ended |
|||||
|
(In millions) |
|
2026 |
|
|
2025 |
|
|
Operating activities |
|
|
||||
|
Net loss |
$ |
(12.8 |
) |
$ |
(6.3 |
) |
|
Adjustments to reconcile net loss to net cash flows provided by operating activities: |
|
|
||||
|
Depreciation and amortization |
|
23.4 |
|
|
22.0 |
|
|
Equity-based compensation expense |
|
0.6 |
|
|
1.0 |
|
|
Deferred taxes |
|
(3.5 |
) |
|
(2.3 |
) |
|
Defined benefit pension and other postretirement employee benefits |
|
0.5 |
|
|
(0.1 |
) |
|
Loss on sale or impairment associated with assets |
|
— |
|
|
0.1 |
|
|
Changes in operating assets and liabilities: |
|
|
||||
|
(Increase) decrease in accounts receivable |
|
(2.6 |
) |
|
11.1 |
|
|
Decrease in inventories |
|
12.4 |
|
|
0.9 |
|
|
(Increase) decrease in other current assets |
|
(0.1 |
) |
|
0.2 |
|
|
Decrease in accounts payable and accrued liabilities |
|
(15.5 |
) |
|
(24.0 |
) |
|
Other, net |
|
(1.8 |
) |
|
(1.1 |
) |
|
Net cash flows provided by operating activities |
|
0.5 |
|
|
1.5 |
|
|
Investing activities |
|
|
||||
|
Additions to property, plant and equipment, net |
|
(9.1 |
) |
|
(32.7 |
) |
|
Net cash flows used in investing activities |
|
(9.1 |
) |
|
(32.7 |
) |
|
Financing activities |
|
|
||||
|
Borrowings on long-term debt |
|
15.0 |
|
|
— |
|
|
Repayments of long-term debt |
|
(0.1 |
) |
|
(0.2 |
) |
|
Taxes paid related to net share settlement of equity awards |
|
(0.5 |
) |
|
(2.3 |
) |
|
Repurchases of common stock |
|
— |
|
|
(10.9 |
) |
|
Other, net |
|
— |
|
|
8.9 |
|
|
Net cash flows (used in) provided by financing activities |
|
14.3 |
|
|
(4.4 |
) |
|
|
|
|
||||
|
Increase (decrease) in cash and cash equivalents |
|
5.8 |
|
|
(35.6 |
) |
|
Cash and cash equivalents at beginning of period |
|
30.7 |
|
|
79.6 |
|
|
Cash and cash equivalents at end of period |
$ |
36.5 |
|
$ |
44.0 |
|
|
|
||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||
|
Adjusted EBITDA |
||||||
|
(Unaudited) |
||||||
|
|
||||||
|
|
Quarter Ended |
|||||
|
(In millions) |
|
2026 |
|
|
2025 |
|
|
Net loss |
$ |
(12.8 |
) |
$ |
(6.3 |
) |
|
Add (deduct): |
|
|
||||
|
Less: loss from discontinued operations, net of tax |
|
— |
|
|
(0.4 |
) |
|
Loss from continuing operations |
|
(12.8 |
) |
|
(5.9 |
) |
|
Income tax benefit |
|
(3.7 |
) |
|
(1.8 |
) |
|
Interest expense, net |
|
5.0 |
|
|
3.3 |
|
|
Depreciation and amortization |
|
23.4 |
|
|
22.0 |
|
|
Other operating charges, net 1 |
|
(11.1 |
) |
|
11.8 |
|
|
Other non-operating expense |
|
1.1 |
|
|
0.3 |
|
|
Adjusted EBITDA from continuing operations |
$ |
1.9 |
|
$ |
29.8 |
|
|
1 Other operating charges, net consist of amounts unrelated to ongoing core operating activities. Please refer to Note 11 within |
||||||
|
|
||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||
|
(Unaudited) |
||||||
|
|
|
|
||||
|
|
Quarter Ended |
|||||
|
(In millions, except per share data) |
|
2026 |
|
|
2025 |
|
|
Adjusted income (loss) from continuing operations: |
|
|
||||
|
Net loss |
$ |
(12.8 |
) |
$ |
(6.3 |
) |
|
Add (deduct): |
|
|
||||
|
Less: loss from discontinued operations, net of tax |
|
— |
|
|
(0.4 |
) |
|
Loss from continuing operations |
|
(12.8 |
) |
|
(5.9 |
) |
|
Add back: |
|
|
||||
|
Income tax benefit |
|
(3.7 |
) |
|
(1.8 |
) |
|
Other operating charges, net |
|
(11.1 |
) |
|
11.8 |
|
|
Adjusted income (loss) from continuing operations before tax |
|
(27.7 |
) |
|
4.1 |
|
|
Normalized income tax (benefit) provision1 |
|
(6.9 |
) |
|
1.0 |
|
|
Adjusted income (loss) from continuing operations |
$ |
(20.7 |
) |
$ |
3.1 |
|
|
|
|
|
||||
|
Weighted average diluted shares (thousands) |
|
16,080 |
|
|
16,375 |
|
|
|
|
|
||||
|
Adjusted income (loss) from continuing operations per diluted share |
$ |
(1.29 |
) |
$ |
0.19 |
|
|
1 Calculated at 25% which is an estimate of |
||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20260428815117/en/
Investors contact:
investorinfo@clearwaterpaper.com
509-344-5906
News media:
509-344-5967
Virginia.aulin@clearwaterpaper.com
Source:
