Mativ Announces Fourth Quarter and Full Year 2022 Results

Mativ Holdings, Inc. (“Mativ” or the “Company”) (NYSE: MATV) reported earnings results for the three months and year ended December 31, 2022. On July 6, 2022, Schweitzer-Mauduit International, Inc. (“SWM”) and Neenah, Inc. (“Neenah”) completed a merger of equals (“the merger”). Financial results for periods prior to the merger reflect only the legacy SWM results.

Mativ Fourth Quarter 2022 Highlights
*Sales increased 69% to $660.1 million, reflecting the benefit of the merger; 6% constant currency organic sales growth, or 2% including negative currency impacts; 20%+ sales growth in release liners and protective solutions led the portfolio
*GAAP Income was $2.5 million, GAAP EPS was $0.04, and GAAP Operating Profit was $26.9 million, which all included significant expenses related to the Neenah merger integration
*Adjusted Income was $31.9 million and Adjusted EPS was $0.56; Adjusted EBITDA was $92.4 million, up 30% on a comparable basis (see non-GAAP reconciliation)
*Continued positive momentum in price/cost performance drove margin expansion
*≈$5 million cost synergies realized in 2022; ≈$25 million incremental synergies expected in 2023

Mativ Full Year 2022 Highlights
*Sales increased 51% to $2,167.4 million, reflecting the benefit of the merger; 11% constant currency organic sales growth, or 7% including negative currency impacts
*Double-digit sales growth in release liners, protective solutions, and packaging and specialty papers led top-line performance with strong pricing more than offsetting higher input costs
*GAAP Loss was $6.6 million, GAAP EPS was $(0.18), and GAAP Operating Profit was $51.4 million, which all included significant expenses related to the Neenah merger closing and integration
*Adjusted Income was $127.0 million, Adjusted EPS was $2.94, and Adjusted EBITDA was $305.2 million; on a comparable basis, Adjusted EBITDA was $370.4 million, up 11% (see non-GAAP reconciliation)

e combined company from continued positive price/cost performance, and we enter 2023 with clear momentum on integration and synergy execution. Despite macro uncertainties, our conviction in the opportunities ahead for Mativ is unwavering. We have significant controllable actions to enable strong performance as we enter 2023, specifically cost synergies, innovation, and programs focused on commercial and operational excellence, as well as broader longer-term decisions and actions to capitalize on our increased scale.”

“While merger-related expenses drove a GAAP loss of nearly $7 million, we exited 2022 with combined full year EBITDA of $370 million, and we expect an incremental $25 million of synergy delivery in 2023. While we see potential growth in the base business and upside to this synergy target, visibility remains limited due to macroeconomic and geopolitical risks and related effects on input costs. Customer de-stocking as supply chains normalize, underlying global demand, and inflation uncertainties make it challenging to provide a more clearly defined guided range. Most importantly, in this uncertain environment, we have strong, vetted, and actioned synergies as we enter 2023 and will continue to execute on more synergy opportunities throughout the year. These are largely within our control and should provide built-in profit improvements in an otherwise volatile global economy.”

Ms. Schertell concluded, “Looking ahead, 2023 will be our first full year together as Mativ, and I am pleased to share we have aligned on several key messages and themes to serve as our strategic ‘North Star’ in the years ahead. Our ambition is to be the global leader in specialty materials, consistently driving growth by engineering bold, innovative solutions that solve our customers’ complex challenges. We can achieve this by leveraging our technologies and material science know-how, advancing our collaborative customer relationships, and supporting our customers with robust global manufacturing and supply chain capabilities. Our stakeholders can expect us to execute with speed and discipline as we lean heavily into growth opportunities, sharpen our focus, and drive value creation. While there are many pockets of growth and attractive profitability across the portfolio, our resources and investments going forward will be concentrated in filtration, protective solutions, and release liners given the attractive end-market dynamics and our ability to differentiate and lead in these high-value product categories. As we move forward, we see tremendous potential for Mativ and enter the new year energized and ready to execute our plans.”
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