Sylvamo Releases Third-Quarter Results with Strong Earnings and Cash Flow
Sylvamo Corporation (NYSE: SLVM) reported strong performance in its third-quarter 2021 earnings, achieving a net income of $92 million or $2.09 per pro forma share. This marks a decrease from $115 million in the previous quarter. Adjusted EBITDA reached $177 million, up from $124 million in Q2 2021. The company anticipates fourth-quarter adjusted EBITDA between $140 million and $150 million. Input costs rose by $26 million, influenced by increased prices for key materials. The gross debt-to-adjusted EBITDA ratio improved to 2.8x.
- Third-quarter adjusted operating earnings of $100 million compared to $68 million in the second quarter of 2021.
- Adjusted EBITDA margin of 19.5%, benefitting from lower maintenance outage costs.
- Projected fourth-quarter adjusted EBITDA between $140 million and $150 million.
- Third-quarter net income decreased to $92 million from $115 million in Q2 2021.
- Input costs increased by $26 million, affecting profit margins.
Message from the Chairman and Chief Executive Officer
“We delivered strong earnings and significant cash in the quarter,” said Jean-Michel Ribiéras. “As we launch
Third-Quarter Highlights
-
Third-quarter net income of
($92 million per pro forma share1) compared with$2.09 ($115 million per pro forma share) in the second quarter of 2021 and$2.61 ($51 million per pro forma share) in the third quarter of 2020$1.16 -
Third-quarter adjusted operating earnings2 (non-GAAP) of
($100 million per pro forma share) compared with$2.27 ($68 million per pro forma share) in the second quarter of 2021 and$1.54 ($51 million per pro forma share) in the third quarter of 2020$1.16 -
Third-quarter adjusted EBITDA3 (non-GAAP) of
compared with$177 million in the second quarter of 2021 and$124 million in the third quarter of 2020$104 million
Third-Quarter Commercial and Operational Highlights
-
Price and mix improved by
versus the prior quarter and volume improved by$30 million $12 million -
Operations improved by
and total planned maintenance outage expenses declined by$10 million versus the second quarter$27 million -
Input costs increased by
, reflecting higher costs for wood, energy, chemicals, packaging and distribution$26 million -
Adjusted EBITDA margins for
Europe ,Latin America andNorth America were19% ,30% and15% , respectively
Fourth-Quarter Outlook
-
Price and mix are expected to improve by
to$30 compared to the third quarter, reflecting continued realization of prior price increases$35 million -
Volume is expected to improve by
to$10 , reflecting continued strong demand in$15 million Europe andNorth America and seasonally stronger demand inLatin America -
Operations are expected to increase by
, reflecting seasonally higher costs in$15 million Europe andNorth America -
Input costs and distribution are projected to increase by
to$35 as prices for wood, energy, chemicals and other key inputs continue to increase$40 million -
Total maintenance outage expenses are projected to increase by
, primarily the impact of a 10-year cold mill outage at our Saillat mill and an extended cold mill outage at our Eastover mill$24 million -
We also project
in costs related to transition service agreements in the quarter and$8 million of one-time costs$4 million -
Our gross debt-to-adjusted EBITDA ratio declined to 2.8x at the end of the third quarter, and we repaid
of outstanding debt on$30 million Oct. 29
1 |
At the date of distribution of |
|
2 |
Adjusted Operating Earnings (non-GAAP) are net earnings (GAAP) excluding net special items. Management uses this measure to focus on on-going operations, and believes that it is useful to investors because it enables them to perform meaningful comparisons of past and present combined operating results. For more information regarding net special items, see the information under the heading Effects of Special Items and the Condensed Combined Statement of Operations and related notes included later in this release. |
|
3 |
Adjusted EBITDA (non-GAAP) is net income (loss) (GAAP) excluding the sum of income taxes, net interest (income) expense, depreciation, amortization and cost of timber harvested, and, when applicable for the periods reported, special items. Management believes that Adjusted EBITDA and Adjusted EBITDA Margin provide investors and analysts meaningful insights into our operating performance and Adjusted EBITDA is a relevant metric for the third-party debt. For more information regarding net special items, see the information under the heading Effects of Special Items and the Condensed Combined Statement of Operations and related notes included later in this release. |
Pro |
|||||||||||
|
Third
|
|
Second
|
|
Third
|
||||||
Net Income (Loss) |
$ |
2.09 |
|
$ |
2.61 |
|
|
$ |
1.16 |
||
Add Back – Net Special Items Expense (Income) |
0.18 |
|
(1.07 |
) |
|
— |
|||||
Adjusted Operating Earnings |
$ |
2.27 |
|
$ |
1.54 |
|
|
$ |
1.16 |
Select Financial Measures |
|||||||||||
(In millions) |
Third
|
|
Second
|
|
Third
|
||||||
|
$ |
908 |
|
$ |
844 |
|
$ |
738 |
|||
Net Income (Loss) |
92 |
|
115 |
|
51 |
||||||
Business Segment Operating Profit |
137 |
|
85 |
|
62 |
||||||
Adjusted Operating Earnings |
100 |
|
68 |
|
51 |
||||||
Adjusted EBITDA |
177 |
|
124 |
|
104 |
||||||
Cash Provided By (Used For) Operating Activities |
157 |
|
140 |
|
73 |
||||||
Free Cash Flow (1) |
135 |
|
125 |
|
56 |
(1) |
Free cash flow is a non-GAAP financial measure. A reconciliation of free cash flow to the most comparable GAAP measure, cash provided by (used for) operating activities, and disclosure regarding why we believe that free cash flow provides useful information to investors, is included later in this release. |
Segment Information
Business Segment Results |
|||||||||||
(In millions) |
Third
|
|
Second
|
|
Third
|
||||||
|
|
|
|
|
|
||||||
|
$ |
262 |
|
|
$ |
243 |
|
|
$ |
220 |
|
|
200 |
|
|
189 |
|
|
150 |
|
|||
|
447 |
|
|
426 |
|
|
375 |
|
|||
Corporate and Inter-segment Sales |
(1 |
) |
|
(14 |
) |
|
(7 |
) |
|||
|
$ |
908 |
|
|
$ |
844 |
|
|
$ |
738 |
|
Operating Profit (Loss) by Business Segment |
|
|
|
|
|
||||||
|
$ |
40 |
|
|
$ |
19 |
|
|
$ |
16 |
|
|
44 |
|
|
44 |
|
|
17 |
|
|||
|
53 |
|
|
22 |
|
|
29 |
|
|||
Total Business Segment Operating Profit |
$ |
137 |
|
|
$ |
85 |
|
|
$ |
62 |
|
Operating profits (losses) in the third quarter of 2021:
Earnings Webcast
The company will host an audio webcast at
Those who wish to participate should call +1-855-982-8078 (
Replays will be available at investors.sylvamo.com for one year and by phone for 90 days. To listen to the replay by phone, call +1-855-859-2056 and use conference ID number 9631345.
About
Effective Tax Rate
The reported effective tax rate for the third quarter of 2021 was
Excluding special items, the operational effective tax rate for the third quarter of 2021 was
Effects of Special Items
Net special items in the third quarter of 2021 amount to a net after-tax charge of
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including our projected adjusted EBITDA for the fourth quarter and the information under the heading “Fourth-Quarter Outlook”. Any or all forward-looking statements may turn out to be incorrect, and our actual actions and results could differ materially from what they express or imply, because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control. These risks, uncertainties, and other factors include those disclosed in the heading “Risk Factors” in our Registration Statement on Form 10 filed with the
Condensed Combined Statement of Operations Preliminary and Unaudited (In millions) |
||||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended |
|
Nine Months Ended
|
|
||||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2021 |
|
2020 |
|
||||||||||
|
$ |
908 |
|
$ |
738 |
|
|
$ |
844 |
|
|
$ |
2,530 |
|
|
$ |
2,213 |
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of products sold |
587 |
(a) |
500 |
|
(f) |
525 |
|
(d) |
1,637 |
|
(a) |
1,562 |
|
(f) |
||||||
Selling and administrative expenses |
47 |
|
50 |
|
|
58 |
|
|
146 |
|
|
150 |
|
|
||||||
Depreciation, amortization and cost of timber harvested |
37 |
|
38 |
|
|
35 |
|
|
108 |
|
|
117 |
|
|
||||||
Distribution expenses |
98 |
|
79 |
|
|
93 |
|
|
276 |
|
|
235 |
|
|
||||||
Taxes other than payroll and income taxes |
9 |
|
10 |
|
|
6 |
|
|
22 |
|
|
22 |
|
|
||||||
Interest (income) expense, net |
10 |
(b) |
(2 |
) |
(g) |
(29 |
) |
(e) |
(19 |
) |
(b) |
(3 |
) |
(g) |
||||||
Income (Loss) Before Income Taxes |
120 |
|
63 |
|
|
156 |
|
|
360 |
|
|
130 |
|
|
||||||
Income tax provision (benefit) |
28 |
(c) |
12 |
|
|
41 |
|
|
91 |
|
(c) |
25 |
|
|
||||||
Net Income (Loss) |
$ |
92 |
|
$ |
51 |
|
|
$ |
115 |
|
|
$ |
269 |
|
|
$ |
105 |
|
|
The accompanying notes are an integral part of this condensed combined statement of operations. |
Three Months and Nine Months Ended |
|
(a) |
Includes pre-tax loss of |
(b) |
Includes pre-tax loss of |
(c) |
Includes an |
Three Months Ended |
|
(d) |
Includes pre-tax income of |
(e) |
Includes net pre-tax income of |
Three Months and Nine Months Ended |
|
(f) |
Includes net pre-tax loss of |
(g) |
Includes net pre-tax income of |
Pro Forma Earnings per Common Share Preliminary and Unaudited (In millions, except per share amounts) |
||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
||||||
Net Income (Loss) |
$ |
92 |
|
$ |
51 |
|
$ |
115 |
|
$ |
269 |
|
$ |
105 |
Pro Forma Earnings Per Common Share |
|
|
|
|
|
|
|
|
|
|||||
Net earnings (loss) |
$ |
2.09 |
|
$ |
1.16 |
|
$ |
2.61 |
|
$ |
6.10 |
|
$ |
2.38 |
Pro |
44 |
|
44 |
|
44 |
|
44 |
|
44 |
At the date of distribution of |
Reconciliation of Net Income (Loss) to Adjusted Operating Earnings Preliminary and Unaudited (In millions, except per share amounts) |
|||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|||||||||||
Net Income (Loss) |
$ |
92 |
|
$ |
51 |
|
$ |
115 |
|
|
$ |
269 |
|
|
$ |
105 |
|||
Add back: Net Special items expense (income) |
8 |
|
— |
|
(47 |
) |
|
(45 |
) |
|
4 |
||||||||
Adjusted Operating Earnings |
$ |
100 |
|
$ |
51 |
|
$ |
68 |
|
|
$ |
224 |
|
|
$ |
109 |
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|||||||||||
Pro Forma Earnings per Common Share as Reported |
$ |
2.09 |
|
$ |
1.16 |
|
$ |
2.61 |
|
|
$ |
6.10 |
|
|
$ |
2.38 |
|||
Add back: Net Special items expense (income) |
0.18 |
|
— |
|
(1.07 |
) |
|
(1.02 |
) |
|
0.09 |
||||||||
Pro Forma Adjusted Operating Earnings per Share |
$ |
2.27 |
|
$ |
1.16 |
|
$ |
1.54 |
|
|
$ |
5.08 |
|
|
$ |
2.47 |
The Company calculates Adjusted Operating Earnings (non-GAAP) by excluding the effect of items considered by management to be unusual (net special items) as reflected in the Condensed Combined Statement of Operations and related notes included in this release from the earnings reported under GAAP. Management uses this measure to focus on on-going operations, and believes that it is useful to investors because it enables them to perform meaningful comparisons of past and present combined operating results. The Company believes that using this information, along with net income, provides for a more complete analysis of the results of operations by quarter. Net income (loss) is the most directly comparable GAAP measure. |
Since earnings per share are computed independently for each period, nine-month per share amounts may not equal the sum of the respective quarters. |
Reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted EBITDA Margin Preliminary and Unaudited (In millions) |
|||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|||||||||||
Net Income (Loss) |
$ |
92 |
|
|
$ |
51 |
|
|
$ |
115 |
|
|
$ |
269 |
|
|
$ |
105 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
||||||||||
Income tax provision (benefit) |
28 |
|
|
12 |
|
|
41 |
|
|
91 |
|
|
25 |
|
|||||
Interest (income) expense, net |
10 |
|
|
(2 |
) |
|
(29 |
) |
|
(19 |
) |
|
(3 |
) |
|||||
Depreciation, amortization and cost of timber harvested |
37 |
|
|
38 |
|
|
35 |
|
|
108 |
|
|
117 |
|
|||||
Stock-based compensation |
3 |
|
|
4 |
|
|
4 |
|
|
10 |
|
|
11 |
|
|||||
Net Special items expense (income) |
7 |
|
|
1 |
|
|
(42 |
) |
|
(35 |
) |
|
6 |
|
|||||
Adjusted EBITDA |
$ |
177 |
|
|
$ |
104 |
|
|
$ |
124 |
|
|
$ |
424 |
|
|
$ |
261 |
|
|
908 |
|
|
738 |
|
|
844 |
|
|
2,530 |
|
|
2,213 |
|
|||||
Adjusted EBITDA Margin |
19.5 |
% |
|
14.1 |
% |
|
14.7 |
% |
|
16.8 |
% |
|
11.8 |
% |
Adjusted EBITDA and Adjusted EBITDA Margin by Business Segment |
|||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
||||||||
|
2021 |
|
2020 |
|
|||||||
Adjusted EBITDA |
$ |
177 |
|
|
$ |
104 |
|
|
$ |
124 |
|
|
49 |
|
|
27 |
|
|
27 |
|
|||
|
59 |
|
|
31 |
|
|
59 |
|
|||
|
69 |
|
|
46 |
|
|
38 |
|
|||
Total Business Segment Adjusted EBITDA |
$ |
177 |
|
|
$ |
104 |
|
|
$ |
124 |
|
|
$ |
909 |
|
|
$ |
745 |
|
|
$ |
858 |
|
|
262 |
|
|
220 |
|
|
243 |
|
|||
|
200 |
|
|
150 |
|
|
189 |
|
|||
|
447 |
|
|
375 |
|
|
426 |
|
|||
Total Business Segment |
$ |
909 |
|
|
$ |
745 |
|
|
$ |
858 |
|
Adjusted EBITDA Margin |
|
|
|
|
|
||||||
|
19 |
% |
|
12 |
% |
|
11 |
% |
|||
|
30 |
% |
|
21 |
% |
|
31 |
% |
|||
|
15 |
% |
|
12 |
% |
|
9 |
% |
The Company calculates Adjusted EBITDA (non-GAAP) by excluding the sum of income taxes, net interest (income) expense, depreciation, amortization and cost of timber harvested as well as the after-tax effect of items considered by management to be unusual (net special items) as reflected in the Condensed Combined Statement of Operations and related notes included in this release from the earnings reported under GAAP. Management believes that Adjusted EBITDA and Adjusted EBITDA Margin provide investors and analysts meaningful insights into our operating performance and Adjusted EBITDA is a relevant metric for the third-party debt. The Company believes that using this information, along with net income, provides for a more complete analysis of the results of its operations. Net income (loss) is the most directly comparable GAAP measure. |
Sales and Earnings by Business Segment Preliminary and Unaudited (In millions) |
|||||||||||||||||||
|
|||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|||||||||||
|
$ |
262 |
|
|
$ |
220 |
|
|
$ |
243 |
|
|
$ |
743 |
|
|
$ |
682 |
|
|
200 |
|
|
150 |
|
|
189 |
|
|
557 |
|
|
434 |
|
|||||
|
447 |
|
|
375 |
|
|
426 |
|
|
1,255 |
|
|
1,114 |
|
|||||
Corporate and Inter-segment Sales |
(1 |
) |
|
(7 |
) |
|
(14 |
) |
|
(25 |
) |
|
(17 |
) |
|||||
|
$ |
908 |
|
|
$ |
738 |
|
|
$ |
844 |
|
|
$ |
2,530 |
|
|
$ |
2,213 |
|
Operating Profit (Loss) by Business Segment |
||||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|
|||||||||||
|
$ |
40 |
|
|
$ |
16 |
|
|
$ |
19 |
|
|
$ |
82 |
|
|
$ |
62 |
|
|
|
44 |
|
|
17 |
|
|
44 |
|
|
131 |
|
|
46 |
|
|
|||||
|
53 |
|
|
29 |
|
|
22 |
|
|
93 |
|
|
25 |
|
|
|||||
Total Business Segment Operating Profit |
$ |
137 |
|
|
$ |
62 |
|
|
$ |
85 |
|
|
$ |
306 |
|
|
$ |
133 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (Loss) Before Income Taxes |
$ |
120 |
|
|
$ |
63 |
|
|
$ |
156 |
|
|
$ |
360 |
|
|
$ |
130 |
|
|
Interest (income) expense, net |
10 |
(a) |
(2 |
) |
(e) |
(29 |
) |
(c) |
(19 |
) |
(a) |
(3 |
) |
(e) |
||||||
Other special items, net |
7 |
|
(b) |
1 |
|
(f) |
(42 |
) |
(d) |
(35 |
) |
(b) |
6 |
|
(f) |
|||||
Business Segment Operating Profit (g) |
$ |
137 |
|
|
$ |
62 |
|
|
$ |
85 |
|
|
$ |
306 |
|
|
$ |
133 |
|
|
Three Months and Nine Months Ended |
|
(a) |
Includes net pre-tax loss of |
(b) |
Includes net pre-tax loss of |
Three Months Ended 30, 2021 |
|
(c) |
Includes net pre-tax income of |
(d) |
Includes net pre-tax income of |
Three Months and Nine Months ended |
|
(e) |
Includes net pre-tax income of |
(f) |
Includes net pre-tax loss of |
(g) |
As set forth in the chart above, business segment operating profit is defined as income (loss) before income taxes, but excluding net interest (income) expense and other special items, net. Business segment operating profit is a measure reported to our management for purposes of making decisions about allocating resources to our business segments and assessing the performance of our business segments and is presented in our financial statement footnotes in accordance with ASC 280. |
Condensed Combined Balance Sheet Preliminary and Unaudited (In millions) |
|||||||
|
|
|
|
||||
Assets |
|
|
|
||||
Current Assets |
|
|
|
||||
Cash and Temporary Investments |
$ |
132 |
|
|
$ |
95 |
|
Accounts and Notes Receivable, Net |
422 |
|
|
400 |
|
||
Related Party Receivable |
25 |
|
|
221 |
|
||
Inventories |
344 |
|
|
342 |
|
||
Other current assets |
96 |
|
|
61 |
|
||
Total Current Assets |
1,019 |
|
|
1,119 |
|
||
Plants, Properties and Equipment, Net |
911 |
|
|
974 |
|
||
Forestlands |
285 |
|
|
293 |
|
||
|
136 |
|
|
143 |
|
||
Right of Use Assets |
43 |
|
|
46 |
|
||
Deferred Charges and Other Assets |
343 |
|
|
336 |
|
||
Total Assets |
$ |
2,737 |
|
|
$ |
2,911 |
|
Liabilities and Parent Company Equity |
|
|
|
||||
Current Liabilities |
|
|
|
||||
Accounts Payable |
$ |
315 |
|
|
$ |
259 |
|
Notes Payable and Current Maturities of Long-Term Debt |
126 |
|
|
4 |
|
||
Accrued Payroll and Benefits |
73 |
|
|
68 |
|
||
Related Party Payable |
110 |
|
|
25 |
|
||
Other Current Liabilities |
160 |
|
|
134 |
|
||
Total Current Liabilities |
784 |
|
|
490 |
|
||
Long-Term Debt |
1,393 |
|
|
22 |
|
||
Deferred Income Taxes |
163 |
|
|
170 |
|
||
Other Liabilities |
132 |
|
|
117 |
|
||
Parent Company Equity |
|
|
|
||||
|
1,892 |
|
|
3,592 |
|
||
Accumulated Other Comprehensive Loss |
(1,627 |
) |
|
(1,480 |
) |
||
Total Parent Company Equity |
265 |
|
|
2,112 |
|
||
Total Liabilities and Parent Company Equity |
$ |
2,737 |
|
|
$ |
2,911 |
|
Condensed Combined Statement of Cash Flows Preliminary and Unaudited (In millions) |
|||||||
|
Nine Months Ended |
||||||
|
2021 |
|
2020 |
||||
Operating Activities |
|
|
|
||||
Net income (loss) |
$ |
269 |
|
|
$ |
105 |
|
Depreciation, amortization and cost of timber harvested |
108 |
|
|
117 |
|
||
Deferred income tax provision (benefit), net |
(8 |
) |
|
(44 |
) |
||
Stock-based compensation |
10 |
|
|
11 |
|
||
Changes in current assets and liabilities |
|
|
|
||||
Accounts and notes receivable |
(28 |
) |
|
98 |
|
||
Related party receivable |
(13 |
) |
|
(13 |
) |
||
Inventories |
(9 |
) |
|
41 |
|
||
Related party payable |
3 |
|
|
12 |
|
||
Accounts payable and accrued liabilities |
99 |
|
|
(55 |
) |
||
Other |
(52 |
) |
|
(47 |
) |
||
Cash Provided By (Used For) Operating Activities |
379 |
|
|
225 |
|
||
Investment Activities |
|
|
|
||||
Invested in capital projects |
(54 |
) |
|
(59 |
) |
||
Cash pool arrangements with Parent |
202 |
|
|
7 |
|
||
Other |
(8 |
) |
|
1 |
|
||
Cash Provided By (Used For) Investment Activities |
140 |
|
|
(51 |
) |
||
Financing Activities |
|
|
|
||||
Net transfers (to) from Parent |
(359 |
) |
|
(201 |
) |
||
Special payment to Parent |
(1,520 |
) |
|
— |
|
||
Issuance of debt |
1,499 |
|
|
— |
|
||
Reduction of debt |
(6 |
) |
|
(15 |
) |
||
Cash Provided By (Used for) Financing Activities |
(386 |
) |
|
(216 |
) |
||
Effect of Exchange Rate Changes on Cash |
(96 |
) |
|
48 |
|
||
Change in Cash and Temporary Investments |
37 |
|
|
6 |
|
||
Cash and Temporary Investments |
|
|
|
||||
Beginning of the period |
95 |
|
|
135 |
|
||
End of the period |
$ |
132 |
|
|
$ |
141 |
|
Reconciliation of Cash Provided by Operations to Free Cash Flow Preliminary and Unaudited (In millions) |
|||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|||||||||||
Cash Provided By (Used For) Operating Activities |
$ |
157 |
|
|
$ |
73 |
|
|
$ |
140 |
|
|
$ |
379 |
|
|
$ |
225 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
||||||||||
Cash invested in capital projects |
(22 |
) |
|
(17 |
) |
|
(15 |
) |
|
(54 |
) |
|
(59 |
) |
|||||
Free Cash Flow |
$ |
135 |
|
|
$ |
56 |
|
|
$ |
125 |
|
|
$ |
325 |
|
|
$ |
166 |
|
Free cash flow is a non-GAAP measure and the most directly comparable GAAP measure is cash provided by operations. Management believes that free cash flow is useful to investors as a liquidity measure because it measures the amount of cash generated that is available, after reinvesting in the business, to maintain a strong balance sheet and service debt, and return cash to shareowners in the future. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. By adjusting for certain items that are not indicative of the Company’s ongoing performance, free cash flow also enables investors to perform meaningful comparisons between past and present periods. |
The non-GAAP financial measures presented in this release have limitations as analytical tools and should not be considered in isolation or as a substitute for an analysis of our results calculated in accordance with GAAP. In addition, because not all companies use identical calculations, the Company’s presentation of non-GAAP measures in this release may not be comparable to similarly titled measures disclosed by other companies, including companies in the same industry as |
Management believes certain non- |
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FAQ
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