Rayonier Advanced Materials Inc. (RYAM) reported a net loss of $25 million, or $0.39 per diluted share, for the quarter ended September 30, 2023, compared to net income of $30 million, or $0.45 per diluted share, for the prior year quarter. Loss from continuing operations for the quarter ended September 30, 2023 was $27 million, or $0.41 per diluted share, compared to income from continuing operations of $18 million, or $0.28 per diluted share, for the prior year quarter.
Q3 2023 Adjusted EBITDA from continuing operations was $24 million. Q3 2023 net sales were $ 369 million, compared to $466 million in the Q3 2022.
“Results for the Q3 reflected continued weak demand across many of our product categories. We are responding by reducing costs and taking opportunistic downtime across all segments. As previously announced, we have taken downtime at our High-Yield Pulp facility in the third and fourth quarters and expect to take downtime in Paperboard and at the High Purity Cellulose plant in Tartas in the fourth quarter,” said De Lyle W. Bloomquist, RYAM’s President and CEO. “Consequently, we are revising down our 2023 Adjusted EBITDA guidance to approximately $150 million while raising our free cash flow guidance to $65 to $75 million. The decline in year-to-date free cash flow in the quarter was primarily driven by planned increases in working capital. As we finish the year, we expect working capital to benefit free cash flow. Additionally, we are reviewing options to monetize passive assets to drive further net debt reduction.”
2023 Guidance
Overall, loss from continuing operations is expected to be approximately $45 million, with Adjusted EBITDA of approximately $150 million for 2023. The Company expects to spend approximately $85 million on custodial capital expenditures and approximately $35 million on discretionary strategic capital expenditures, net of financing. Strategic capital may be modulated as necessary to support Adjusted Free Cash Flow. The Company is targeting $85 to $95 million of benefit from working capital to support Adjusted Free Cash Flow for the year. Overall, the Company expects to generate $65 to $75 million of Adjusted Free Cash Flow in 2023.
RYAM is a global leader of cellulose-based technologies, including high purity cellulose specialties, a natural polymer commonly used in the production of filters, food, pharmaceuticals and other industrial applications. The Company also manufactures products for paper and packaging markets.
