KP Tissue Releases Second Quarter 2022 Financial Results

KP Tissue Inc. (KPT) (TSX: KPT) reports the Q2 2022 financial and operational results of KPT and Kruger Products L.P. (KPLP). Kruger Products is Canada’s leading manufacturer of quality tissue products for the Consumer market (Cashmere®, Purex®, SpongeTowels®, Scotties®, White Swan® and BonterraTM) and the Away-From-Home (AFH) market and continues to expand in the U.S. Consumer market with the White Cloud® brand and premium private label products. KPT currently holds a 14.1% interest in KPLP.

KPLP Q2 2022 Business and Financial Highlights
• Revenue was $397.5 million in Q2 2022 compared to $339.3 million in Q2 2021, an increase of $58.2 million or 17.1%.
• Adjusted EBITDA1 was $11.8 million in Q2 2022, compared to $37.3 million in Q2 2021, a decrease of 68.3%.
• Net loss was $35.5 million in Q2 2022 compared to net income of $2.2 million in Q2 2021, a decrease of $37.7 million.
• Declared a quarterly dividend of $0.18 per share to be paid on October 17, 2022.

“We delivered another strong quarter of double-digit revenue growth in Q2 2022, but the depth, breadth and speed of inflation severely impacted our operating results and lowered profitability,” stated KP Tissue’s Chief Executive Officer, Dino Bianco. “We expect a partial recovery in the third quarter as successive pricing increases begin catching up with the inflationary curve, productivity gains are felt at our Memphis operations, and extensive cost management initiatives take effect. By the end of the fourth quarter, we anticipate a full recovery based on peaked pulp prices and reduced freight rates along with additional pricing adjustments. Consequently, we are highly confident about returning to a normalized margin in the near term.”

“While addressing temporary disruptions head-on, we continued investments in our Sherbrooke Expansion project and AI network implementations, supported our Bonterra, UltraLuxe and White Cloud launches with targeted marketing campaigns, as well as maintained our focus on our sustainable development program. We take particular pride in being ranked fifth overall among the Best 50 Corporate Citizens for 2022 in Canada and first among tissue paper companies, according to latest research from Corporate Knights,” Mr. Bianco added.
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