Clearwater Paper Reports First Quarter 2023 Results

Clearwater Paper Corporation has reported financial results for the first quarter ended march 31, 2023.

First Quarter Highlights:

Solid performance in the quarter, with price realization offsetting inflation
Strong demand for tissue products, softening demand for paperboard
Net sales of $525 million, up 8% compared to the first quarter of last year, driven by higher pricing
Net income of $24 million, or $1.40 per diluted share

Adjusted EBITDA of $66 million

"Our performance improved relative to the fourth quarter, as we resolved operational issues at our paperboard mills and continued to see higher pricing,” said Arsen Kitch, president and chief executive officer. “Demand for our tissue products remained strong, while demand softened in our paperboard business. Despite uncertain economic conditions, both of our businesses are in markets that have historically been economically resilient.”

Overall Results

For the first quarter of 2023, Clearwater Paper reported net sales of $525 million, an 8% increase compared to net sales of $488 million for the first quarter of 2022. Net income for the first quarter of 2023 was $24 million, or $1.40 per diluted share, compared to net income for the first quarter of 2022 of $17 million, or $0.97 per diluted share. On a non-GAAP basis, Clearwater Paper reported adjusted net income in the first quarter of 2023 of $25 million, or $1.47 per diluted share, compared to first quarter 2022 adjusted net income of $18 million, or $1.03 per diluted share. Adjusted EBITDA for the quarter was $66 million, compared to the first quarter of 2022 Adjusted EBITDA of $59 million.

Pulp and Paperboard Segment

Net sales in the Pulp and Paperboard segment were $279 million for the first quarter of 2023, up 5% compared to first quarter 2022 net sales of $266 million. Segment operating income for the first quarter of 2023 was $57 million, compared to $50 million for the first quarter of 2022. Adjusted EBITDA for the segment was $66 million in the first quarter of 2023, compared to $60 million in the first quarter of 2022.

The increase in operating income and Adjusted EBITDA was driven by higher sales prices, partly offset by higher input costs in fiber, chemicals and energy.

Pulp and Paperboard Sales Volumes and Prices:

Paperboard sales volumes were 189,398 tons in the first quarter of 2023 compared to 201,356 tons in the first quarter of 2022.

Paperboard average net selling price increased 14% to $1,441 per ton for the first quarter of 2023, compared to $1,263 per ton in the first quarter of 2022.

Consumer Products Segment:

Net sales in the Consumer Products segment were $248 million for the first quarter of 2023, up 11% compared to first quarter 2022 net sales of $223 million. Segment operating income for the first quarter of 2023 was $4 million compared to operating income of $1 million in the first quarter of 2022. Adjusted EBITDA for the segment was $19 million in the first quarter of 2023, compared to $16 million in the first quarter of 2022. The increase in operating income and Adjusted EBITDA was driven by higher sales prices partly offset by higher input costs in pulp and energy.

Retail Tissue Sales Volumes and Prices:

Retail tissue volumes sold were 76,848 tons in the first quarter of 2023 compared to 75,426 tons in the first quarter of 2022.

Retail tissue average net selling price increased 11% to $3,201 per ton in the first quarter of 2023, compared to $2,872 per ton in the first quarter of 2022.

Company Outlook:

“We expect demand for paperboard to improve in the second half versus the first half as we believe that customers will adjust their inventories and end users will return to more normal buying patterns. We will continue to monitor our paperboard inventories and intend to match supply with demand as needed. We expect continued strength in our tissue business in the coming quarters, with anticipated strong demand and moderating input costs driving margin improvement,” continued Kitch.

Back to Tissue360 Newsletter