Cascades Announces Record Sales and Adjusted OIBD for the Second Quarter of 2019

Q2 2019 Highlights
• Sales of $1,275 million (compared to $1,230 million in Q1 2019 (+4%) and $1,180 million in Q2 2018 (+8%))
• As reported (including specific items) • Operating income of $82 million (compared to $72 million in Q1 2019 (+14%) and $73 million in Q2 2018 (+12%))
• Operating income before depreciation and amortization (OIBD) 1 of $154 million (compared to $139 million in Q1 2019 (+11%) and $131 million in Q2 2018 (+18%))
• Net earnings per share of $0.33 (compared to $0.26 in Q1 2019 and $0.28 in Q2 2018)
• Adjusted (excluding specific items) 1 • Operating income of $84 million (compared to $68 million in Q1 2019 (+24%) and $76 million in Q2 2018 (+11%))
• OIBD of $156 million (compared to $135 million in Q1 2019 (+16%) and $134 million in Q2 2018 (+16%))
• Net earnings per share of $0.28 (compared to $0.14 in Q1 2019 and $0.30 in Q2 2018)
• Net debt 1 of $1,861 million as at June 30, 2019 (compared to $1,878 million as at March 31, 2019 ) and net debt to adjusted OIBD ratio 1 at 3.3x on a pro-forma basis 2 .

Mr. Mario Plourde , President and Chief Executive Officer, commented: “Cascades delivered record quarterly sales and adjusted OIBD that were in line with expectations in the second quarter. All our segments executed well. Tissue results were supported by favourable input costs and selling prices and better operational performance, notably at the St. Helens mill in Oregon , Containerboard Packaging performance reflected lower OCC prices and good operational flexibility within a context of softer demand and pricing pressure, while European Boxboard and Specialty Products results benefited from recent business acquisitions.

On the strategic front, we announced the acquisition of substantially all of the Orchids Paper Products assets in early July. This move provides compelling optimization opportunities for our Tissue platform while reinforcing the operational foundation of this segment’s U.S. consumer product business. Furthermore, the addition of these assets accelerates our ongoing Tissue modernization plan, is aligned with our efforts to enhance the quality of the products we manufacture, and reinforces our initiatives to support the growth of our customers and the segment. On the Containerboard side, analysis of the Bear Island conversion project in Virginia is advancing, with added time being taken to determine the optimal structure to successfully execute the project and to minimize risk. We expect to provide additional information by the end of the year.

Sales of $1,275 million increased by $95 million , or 8%, compared to the same period last year, attaining a record level for the second quarter. Specifically, Tissue sales increased by $34 million or 10%, reflecting a higher average selling price, a more favourable sales mix and exchange rate, partially offset by slightly lower volume following the previously announced closure of 2 paper machines in Ontario . European Boxboard sales increased by $38 million , or 16%, compared to the prior year.

The Corporation generated an operating income before depreciation and amortization (OIBD) of $154 million in the second quarter of 2019. This compares to the $131 million generated in the same period last year. This reflects higher average selling prices, a more favourable sales mix and lower raw material prices in the Tissue and Containerboard segments. In the case of both segments, these benefits were partially offset by lower volumes during the period.

For the 3-month period ended June 30, 2019 , the Corporation posted net earnings of $31 million , or $0.33 per share, compared to net earnings of $27 million , or $0.28 per share, in the same period of 2018.
more detail at: https://www.cascades.com/en/media-centre/press-releases-and-news/press-release/2019/6263/cascades-announces-record-sales-and-adjusted-oibd-for-the-second-quarter-of-2019-quarterly-dividend-increased-from-004-to-008-per-share

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