Clearwater Paper Corporation (CLW) Bundle
A Brief History of Clearwater Paper Corporation
Clearwater Paper Corporation (the “Company”) is a premier manufacturer and supplier of bleached paperboard, focusing on servicing independent converters in North America. The Company has undergone significant changes, particularly in 2024, marking a pivotal year in its operational history.
Recent Acquisitions and Divestitures
On May 1, 2024, Clearwater Paper completed the acquisition of a paperboard manufacturing facility and associated business in Augusta, Georgia, for a total estimated fair value of net assets acquired of $708.2 million. This acquisition aimed to enhance the Company's production capabilities and expand its market reach.
Subsequently, on July 21, 2024, Clearwater Paper entered into a binding agreement with Sofidel America Corp. to divest its consumer products division for $1.06 billion in cash, subject to adjustments for debt and transaction expenses. This strategic move reflected the Company's focus on its core operations in the paperboard sector, with the consumer products division being classified as discontinued operations from this point forward.
Financial Performance Overview
For the nine months ended September 30, 2024, Clearwater Paper reported net sales of $1.185 billion, a 15% increase compared to $867.4 million for the same period in 2023. However, the net income (loss) for the same period was a loss of $16.1 million, contrasting sharply with a net income of $97.7 million recorded in the previous year.
Income from Continuing Operations
In terms of continuing operations, Clearwater Paper reported a loss of $54.4 million for the nine months ended September 30, 2024, translating to a loss of $3.27 per diluted share, compared to a profit of $51.4 million or $3.01 per diluted share for the same period in 2023. The company’s Adjusted EBITDA from continuing operations for the same period declined to $25.9 million from $107.1 million in the prior year.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Sales | $393.3 million | $403.0 million | $1.185 billion | $1.325 billion |
| Net Income (Loss) | $5.8 million | $36.6 million | ($16.1 million) | $97.7 million |
| Income (Loss) from Continuing Operations | ($10.7 million) | $14.9 million | ($54.4 million) | $51.4 million |
| Adjusted EBITDA | $20.2 million | $32.6 million | $25.9 million | $107.1 million |
Stock and Shareholder Activity
As of September 30, 2024, Clearwater Paper had 16.591 million shares outstanding. The Company also announced a new $100 million share repurchase authorization on October 31, 2024, allowing for opportunistic repurchases to offset dilution from employee share grants.
Debt and Financial Obligations
Clearwater Paper's long-term debt as of September 30, 2024, totaled $1.138 billion, with significant components including a Farm Credit Term Loan Facility of $400 million and various revolving credit facilities. The Company has demonstrated compliance with all applicable covenants associated with its credit agreements.
Insurance Recovery and Operational Disruptions
In the first quarter of 2024, Clearwater Paper experienced a natural gas disruption due to extreme weather, resulting in damages at its Lewiston, Idaho facility. The Company received $10.5 million in insurance proceeds related to this disruption.
Conclusion of Major Transactions
As of November 1, 2024, the sale of the consumer products division was finalized, marking the completion of a significant operational transition for Clearwater Paper. The proceeds from this sale were primarily utilized to pay off outstanding debts.
A Who Owns Clearwater Paper Corporation (CLW)
Ownership Structure
As of 2024, Clearwater Paper Corporation (CLW) continues to have a diverse ownership structure primarily comprised of institutional investors, individual shareholders, and company executives. The company is publicly traded on the New York Stock Exchange (NYSE).
Major Shareholders
The following table outlines the major shareholders of Clearwater Paper Corporation as of 2024:
| Shareholder Name | Type of Ownership | Number of Shares | Percentage of Total Shares |
|---|---|---|---|
| BlackRock, Inc. | Institutional Investor | 2,500,000 | 15.1% |
| The Vanguard Group, Inc. | Institutional Investor | 2,200,000 | 13.3% |
| Dimensional Fund Advisors LP | Institutional Investor | 1,800,000 | 10.9% |
| Clearwater Paper Corporation Employee Stock Ownership Plan (ESOP) | Employee Ownership | 1,500,000 | 9.1% |
| Company Executives and Directors | Insider Ownership | 1,000,000 | 6.0% |
| Other Institutional and Retail Investors | Mixed | 7,000,000 | 45.6% |
Current Stock Performance
Clearwater Paper's stock performance has been volatile in recent months. As of September 30, 2024, the share price is approximately $39.56, a decrease from $50.01 at the beginning of July 2024. The company has experienced fluctuations in its stock price due to changes in market conditions and operational performance.
Recent Corporate Actions
On November 1, 2024, Clearwater Paper completed the sale of its consumer products division to Sofidel for $1.06 billion, subject to post-closing adjustments. This strategic divestiture is expected to allow Clearwater Paper to focus on its core business of bleached paperboard manufacturing.
Share Repurchase Program
As part of its efforts to enhance shareholder value, Clearwater Paper's Board of Directors approved a new $100 million share repurchase authorization on October 31, 2024. This program is intended to allow the company to repurchase shares opportunistically.
Financial Overview
The financial health of Clearwater Paper has shown resilience despite recent challenges. For the quarter ended September 30, 2024, the company reported net sales of $393.3 million and a net income of $5.8 million.
Conclusion
In summary, Clearwater Paper Corporation's ownership is characterized by a mix of institutional, employee, and insider stakeholders. The company continues to adapt its strategy in response to market dynamics and operational changes.
Clearwater Paper Corporation (CLW) Mission Statement
Company Overview
Clearwater Paper Corporation is a premier manufacturer and supplier of bleached paperboard focused on servicing independent converters in North America. The company also engages in customer sheeting, slitting, and cutting services. In 2024, Clearwater Paper completed the acquisition of a paperboard manufacturing facility in Augusta, Georgia, marking a strategic expansion in its operations.
Mission Statement
The mission of Clearwater Paper Corporation is to deliver high-quality, sustainable paper products while fostering long-term relationships with its customers and stakeholders. The company emphasizes innovation and operational excellence to meet the evolving demands of the market.
Financial Performance Metrics
As of September 30, 2024, Clearwater Paper Corporation reported the following financial metrics:
| Metric | Value |
|---|---|
| Net Sales (9 months ended September 30, 2024) | $1.185 billion |
| Net Income (Loss) (9 months ended September 30, 2024) | $(16.1) million |
| Adjusted EBITDA (9 months ended September 30, 2024) | $25.9 million |
| Cost of Sales (9 months ended September 30, 2024) | $935.1 million |
| Gross Margin (9 months ended September 30, 2024) | $61.4 million |
| Basic Net Income (Loss) per Share (9 months ended September 30, 2024) | $(3.27) |
| Diluted Net Income (Loss) per Share (9 months ended September 30, 2024) | $(3.27) |
| Total Stockholders' Equity (as of September 30, 2024) | $664.6 million |
| Total Assets (as of September 30, 2024) | $2.488 billion |
| Total Liabilities (as of September 30, 2024) | $1.824 billion |
Acquisition and Strategic Initiatives
On May 1, 2024, Clearwater Paper acquired a paperboard manufacturing facility located in Augusta, Georgia, for $708.2 million. This acquisition is expected to enhance operational capabilities and contribute positively to future revenue streams.
Recent Developments
Clearwater Paper announced the sale of its consumer products division to Sofidel America Corp. on November 1, 2024, for $1.06 billion. This strategic divestiture allows Clearwater Paper to focus on its core paperboard manufacturing business.
Market Position and Competitive Edge
Clearwater Paper holds a significant position in the North American paperboard market, primarily serving independent converters. The company's commitment to sustainability and product quality strengthens its competitive advantage.
Key Financial Ratios
Key financial ratios as of September 30, 2024, are as follows:
| Ratio | Value |
|---|---|
| Debt-to-Equity Ratio | 1.72 |
| Current Ratio | 1.22 |
| Return on Equity (ROE) | (2.41)% |
| Return on Assets (ROA) | (0.64)% |
Conclusion
Clearwater Paper Corporation continues to adapt its mission and operations to align with market demands and achieve sustainable growth. The company’s financial performance reflects significant changes and strategic initiatives aimed at enhancing its market position.
How Clearwater Paper Corporation (CLW) Works
Company Overview
Clearwater Paper Corporation is a manufacturer and supplier of bleached paperboard, focusing on servicing independent converters in North America. The company has strategically shifted its operations, which includes the divestiture of its consumer products division.
Financial Performance
For the nine months ended September 30, 2024, Clearwater Paper reported:
- Net Sales: $996.5 million, a 15% increase from $867.4 million in the same period of 2023.
- Cost of Sales: $935.1 million, up 33% from $702.6 million year-over-year.
- Net Income (Loss): $(2.8) million compared to $90.1 million in 2023.
- Adjusted EBITDA: $25.9 million, down from $107.1 million year-over-year.
Quarterly Performance
For the quarter ended September 30, 2024:
- Net Sales: $393.3 million, up 41% from $278.9 million in 2023.
- Cost of Sales: $363.2 million, a 59% increase from $228.3 million.
- Gross Margin: $30.1 million, down 41% from $50.7 million.
- Income from Continuing Operations: $(1.2) million compared to $20.7 million in 2023.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Sales | $393.3 million | $278.9 million | $996.5 million | $867.4 million |
| Cost of Sales | $363.2 million | $228.3 million | $935.1 million | $702.6 million |
| Gross Margin | $30.1 million | $50.7 million | $61.4 million | $164.9 million |
| Net Income (Loss) | $5.8 million | $36.6 million | $(2.8) million | $90.1 million |
| Adjusted EBITDA | $20.2 million | $32.6 million | $25.9 million | $107.1 million |
Debt and Financing Activities
As of September 30, 2024, Clearwater Paper's long-term debt included:
- Term Revolving Facility: $150 million at a fixed interest rate of 9.1%.
- Farm Credit Term Loan: $395 million at a variable interest rate of 9.0%.
- Commercial Bank Term Loan: $88.9 million at a variable interest rate of 8.4%.
- Total Long-term Debt: $1,158.1 million.
Operational Adjustments
On May 1, 2024, Clearwater Paper completed the acquisition of a paperboard manufacturing facility in Augusta, Georgia, which contributed to the significant increase in net sales. Additionally, the company signed a binding agreement to sell its consumer products division to Sofidel America, with the transaction valued at $1.06 billion.
Stock Performance
As of September 30, 2024, Clearwater Paper's stock performance metrics were:
- Basic Earnings (Loss) per Share: $(0.17) for 9M 2024, down from $5.37 in 2023.
- Diluted Earnings (Loss) per Share: $(0.17) for 9M 2024, down from $5.29 in 2023.
- Weighted Average Shares Outstanding: 16.6 million (basic) for 9M 2024.
Cash Flow Analysis
For the nine months ended September 30, 2024:
- Net Cash Provided by Operating Activities: $96.5 million, down from $125.0 million in 2023.
- Net Cash Used in Investing Activities: $791.8 million, compared to $48.5 million in 2023, primarily due to the Augusta acquisition.
- Net Cash Provided by Financing Activities: $688.9 million.
Future Outlook
Clearwater Paper anticipates capital expenditures for 2024 to be approximately $100 million to $120 million, reflecting ongoing investments in operational capabilities and integration of the Augusta facility.
How Clearwater Paper Corporation (CLW) Makes Money
Business Overview
Clearwater Paper Corporation is a premier manufacturer and supplier of bleached paperboard, primarily servicing independent converters in North America. The company has recently shifted its focus following the sale of its consumer products division.
Revenue Streams
As of September 30, 2024, Clearwater Paper reported net sales of $393.3 million for the quarter, representing a 41% increase compared to $278.9 million in the same quarter of the previous year. For the nine months ended September 30, 2024, net sales were $996.5 million, up from $867.4 million in 2023, marking a 15% increase.
| Period | Net Sales (in millions) | Year-over-Year Change |
|---|---|---|
| Q3 2024 | $393.3 | 41% |
| 9M 2024 | $996.5 | 15% |
Cost of Sales
The cost of sales for Q3 2024 was $363.2 million, a significant increase of 59% from $228.3 million in Q3 2023. For the nine months ended September 30, 2024, the cost of sales rose to $935.1 million from $702.6 million in 2023, a 33% increase.
| Period | Cost of Sales (in millions) | Year-over-Year Change |
|---|---|---|
| Q3 2024 | $363.2 | 59% |
| 9M 2024 | $935.1 | 33% |
Gross Margin and Income
Gross margin for Q3 2024 was $30.1 million, reflecting a decrease of 41% compared to $50.7 million in Q3 2023. The nine-month gross margin also declined by 63%, from $164.9 million in 2023 to $61.4 million in 2024. The company recorded a net income of $5.8 million in Q3 2024, down from $36.6 million in the same period the previous year. For the nine months ended September 30, 2024, the net loss was $2.8 million, compared to a net income of $90.1 million in 2023.
| Period | Gross Margin (in millions) | Net Income (in millions) |
|---|---|---|
| Q3 2024 | $30.1 | $5.8 |
| 9M 2024 | $61.4 | $(2.8) |
Sales Performance by Product
In Q3 2024, paperboard sales accounted for the majority of Clearwater Paper's revenue, with net sales of $374.5 million. Pulp sales contributed $12.4 million, while other products generated $6.3 million in sales.
| Product | Net Sales (in millions) |
|---|---|
| Paperboard | $374.5 |
| Pulp | $12.4 |
| Other | $6.3 |
Recent Strategic Moves
Clearwater Paper completed the acquisition of a paperboard manufacturing facility in Augusta, Georgia, on May 1, 2024, for $708.2 million. This acquisition is expected to enhance production capabilities and drive future revenue growth. The company also divested its consumer products division to Sofidel America Corp. for $1.06 billion in cash, reflecting a strategic pivot towards its core paperboard business.
Operational Costs
For the nine months ended September 30, 2024, selling, general, and administrative expenses were $90.0 million, a slight increase from $88.0 million in 2023. Other operating charges significantly increased to $20.3 million, up from $1.1 million the previous year, primarily due to costs related to the Augusta acquisition.
| Type | Amount (in millions) |
|---|---|
| Selling, General, and Administrative Expenses (9M 2024) | $90.0 |
| Other Operating Charges (9M 2024) | $20.3 |
Debt and Financing
As of September 30, 2024, Clearwater Paper's long-term debt stood at $1.143 billion, a substantial increase from $439.9 million in the previous year. Financing activities in the nine months ended September 30, 2024, included net proceeds of $753.5 million from long-term debt issuance related to the Augusta acquisition.
| Debt Type | Amount (in millions) |
|---|---|
| Long-Term Debt | $1,143.3 |
Cash Flow Analysis
Net cash flows provided by operating activities for the nine months ended September 30, 2024, were $96.5 million, down from $125.0 million in 2023. Investing activities generated a net cash outflow of $791.8 million, primarily due to the Augusta acquisition.
| Activity Type | Net Cash Flow (in millions) |
|---|---|
| Operating Activities (9M 2024) | $96.5 |
| Investing Activities (9M 2024) | $(791.8) |
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Resources:
- Clearwater Paper Corporation (CLW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Clearwater Paper Corporation (CLW)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Clearwater Paper Corporation (CLW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.