Sylvamo Corporation (NYSE:SLVM) reported second-quarter earnings on Friday that missed analyst expectations, with heavy maintenance outages and unfavorable foreign exchange effects weighing on its results. Following the announcement, Sylvamo’s shares fell 7.5% in pre-market trading.
The paper company posted earnings of $0.37 per share, below the consensus estimate of $0.48. Revenue declined 15% year over year to $794 million, missing the forecast of $831.74 million and down from $933 million in the same quarter last year. The earnings and revenue shortfall triggered investor disappointment, leading to the sharp stock decline.
“We delivered second quarter earnings in line with our outlook, overcoming a $13 million unfavorable foreign exchange impact while navigating the heaviest planned maintenance outage quarter in over five years,” said Jean-Michel Ribiéras, Chairman and CEO of Sylvamo.
Adjusted EBITDA fell to $82 million with a 10% margin, down from $90 million and an 11% margin in Q1. The decrease was mainly driven by $39 million higher expenses linked to maintenance outages compared to the previous quarter.
By region, Europe recorded an operating loss of $38 million, Latin America’s operating profit sharply dropped to $2 million from $26 million in Q1, while North America was the strongest performer, with operating profit rising to $66 million from $42 million.
Looking ahead, Sylvamo provided Q3 guidance projecting adjusted EBITDA between $145 million and $165 million, a notable improvement over Q2, as the company expects no planned maintenance outages, better volumes, and improved operational performance.
“With 85% of our full-year planned maintenance outages behind us, we are positioned for a stronger performance in the second half of the year,” Ribiéras added. “We anticipate seasonally stronger demand in North America and Latin America, along with better operational efficiency.”
Sylvamo Corporation stock price
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