Cascades (CAS) Q4 2023 earnings summary

Executive summary

• FY2023 sales were $4,638 million, up from $4,466 million; adjusted EBITDA was $558 million versus $376 million, led by Tissue Papers.

• Q4 sales were $1,138 million; adjusted EBITDA was $122 million, while reported operating loss was $24 million and net loss per share was $0.57.

Financial highlights

• FY2023 operating income was $40 million versus $33 million in 2022; reported net loss was $76 million, or $0.76 per share, versus $34 million, or $0.34 per share.

• FY2023 adjusted net earnings were $109 million, or $1.08 per share, versus $37 million, or $0.37 per share; adjusted EBITDA margin was 12.0% versus 8.4%.

• Q4 adjusted net earnings were $5 million, or $0.05 per share, versus $22 million, or $0.22 per share in Q4 2022; adjusted EBITDA margin was 10.7% versus 10.2%.

• Q4 sales increased $3 million YoY as higher volume contributed $57 million and favorable mix $10 million, largely offset by $70 million in lower selling prices.

Outlook and guidance

• Q1 2024 consolidated results are expected to decrease sequentially, mainly from lower Containerboard results amid higher raw material costs, slightly lower prices and reduced production to manage inventory.

• Tissue Papers results are expected to decline slightly sequentially due to raw material cost increases and seasonal softness; Specialty Packaging results are expected to improve on efficiency gains, especially in plastics.

• Packaging volume outlook remains prudent for Q1 amid economic uncertainty; ongoing profitability initiatives are expected to support performance.

• FY2024 forecast net capital expenditures remain $175 million.