Cascades starts 2025 with stronger earnings despite lower sales

Cascades Inc. reported its unaudited financial results for the first quarter of 2025, ended March 31. Despite a drop in sales compared to the previous quarter, the company posted higher profitability and adjusted EBITDA.

Revenue for the period reached CA$ 1.154 billion, down from CA$ 1.211 billion in Q4 2024 but above the CA$ 1.109 billion reported in Q1 2024. Operating income totaled CA$ 50 million, compared to CA$ 16 million in the previous quarter and CA$ 9 million in the same period last year.

Net earnings per common share were CA$ 0.07, reversing a loss of CA$ 0.13 per share in the previous quarter and a CA$ 0.20 loss in Q1 2024. Adjusted EBITDA (EBITDA (A)) reached CA$ 125 million, below the CA$ 146 million from Q4 2024 but above the CA$ 103 million recorded in Q1 2024.

Adjusted net earnings per common share stood at CA$ 0.13, down from CA$ 0.25 in Q4 2024, but up from CA$ 0.00 in Q1 2024.

Net debt at the end of March was CA$ 2.216 billion, compared to CA$ 2.096 billion as of December 31, 2024. The net debt to adjusted EBITDA (A) ratio remained stable at 4.2x.

Capital expenditures, net of disposals, totaled CA$ 36 million in the quarter, compared to CA$ 29 million in the previous quarter and CA$ 41 million in Q1 2024. The company’s forecast for 2025 capital expenditures, before disposals, is approximately CA$ 175 million.

 

President and CEO Hugues Simon commented: “Our first quarter performance was driven by lower volumes across our businesses as uncertainty regarding tariffs led to a deterioration in consumer and business sentiment beginning in mid-February, resulting in lower sales and profitability levels sequentially. Results were similarly impacted by usual higher seasonal energy costs, increased operational costs due to lower production, and higher transportation costs. Offsetting these factors were favourable average selling prices and raw material costs across our businesses. Broadly, the depreciation of the Canadian dollar benefited quarterly results”.

Discussing the near-term outlook, Simon said: “We are expecting stronger second quarter results. The sequential improvement in packaging will reflect benefits from the implementation of previously announced price increases. We expect improved tissue performance to be driven by volume growth, with positive retail tissue trends and a pick up in Away-from-Home, along with pricing initiatives, the benefits of which are expected to mitigate higher raw material costs. Broadly, continued uncertainty in the macro-economic environment may impact future demand levels across North America and our outlook”.

Read the full report here.