For the second year in a row, the media, research and financial information products company Corporate Knights has named Cascades one of the world's 100 most sustainable corporations. Cascades rose to 17th place among the 8,080 organizations analyzed. Having ranked 49th last year, Cascades has clearly made tremendous progress and remains the leader among the corporations assessed in its sector. The Global 100 Most Sustainable Corporations in the World ranking is the result of an in-depth analysis of international corporations with more than $1 billion in revenues. Cascades also ranks 3rd among the 13 Canadian corporations on the list. Cascades' ranking as one of the world's most sustainable businesses is the latest in a series of sustainable development distinctions it has received over the years and bears witness to the efforts made by the Company in terms of environmental protection and social responsibility.
Commenting on the group’s results, Sappi Chief Executive Officer Steve Binnie said: “I am very proud of another quarter of record earnings against a backdrop of significant geopolitical turmoil, supply chain headwinds and extraordinary global inflationary pressures.
Strong global paper demand and pricing momentum offset sharply rising costs and the negative impact of scheduled maintenance shuts at four mills. EBITDA improved to a record US$371 million, up from US$337 million in the prior quarter and US$145 million in the equivalent quarter a year ago.
Covid lockdowns in China and the ongoing Russian-Ukrainian conflict exerted renewed pressure on global supply chains and energy prices resulting in further broad-based inflation during the quarter. During April, a flood in South Africa forced the temporary closure of our three mills in the KwaZulu-Natal region and resulted in a loss of 24,000 tons of production and 32,000 tons of inventory which was damaged in a warehouse at the Durban Port.
Despite these challenges, the sizeable cash generation during the quarter of US$170 million supported our strategic objective to de-gear the balance sheet and accelerated our timeline to reduce debt. To this effect, net debt of US$1,530 million was US$525 million less than the prior year and earnings per share excluding special items of 39 US cents was a substantial improvement on the 5 US cents in the prior year.”
Looking forward, Binnie stated: “Notwithstanding inflationary cost pressures, we are anticipating another strong performance in the fourth quarter, with EBITDA below the record levels achieved in the third quarter.”
Financial summary for the quarter
• EBITDA excluding special items US$371 million (Q3 FY21 US$145 million)
• Net debt of US$1,530 million (Q3 FY21 US$2,055 million)
• Profit for the period US$199 million (Q3 FY21 US$18 million)
• EPS excluding special items 39 US cents (Q3 FY21 5 US cents)
The packaging and speciality papers segment reached another record level of profitability despite flat year-on-year sales volumes, which were constrained by available capacity and low inventory levels in North America and South Africa. Demand remained robust and further selling price increases lifted margins for the segment.
Graphic paper sales volumes were 4% higher than the prior year. The segment benefited from tight market conditions which supported selling price increases and drove margin growth. These favourable market conditions enabled all assets to run at full operating rates during the quarter.
A substantial improvement in profitability of the European business was a result of favourable market conditions, which facilitated selling price increases in the paper segments and enabled the region to offset higher costs across all input categories.
Profitability of the North American business continued its upwards trajectory with the region recording yet another record quarterly EBITDA of US$118 million.
details at: https://cdn-s3.sappi.com/s3fs-public/Q3-FY22-Financial-results-booklet-Final.pdf