KP Tissue reports revenue of $451.0 million in Q1 2023
“Although we are still coping with volatile pulp prices and a weakened Canadian dollar, profitable growth remains our goal for 2023 and beyond” – Dino Bianco
KP Tissue Inc. reported the Q1 2023 financial and operational results of KPT and Kruger Products Inc. The company is Canada’s leading manufacturer of quality tissue products for the Consumer market (Cashmere®, Purex®, SpongeTowels®, Scotties®, White Swan® and BonterraTM) and the Away-From-Home (AFH) market and continues to grow in the U.S. Consumer tissue business with the White Cloud® brand and premium private label products. KPT currently holds a 13.5% interest in Kruger Products.
Q1 2023 BUSINESS AND FINANCIAL HIGHLIGHTS
- Revenue was $451.0 million in Q1 2023 compared to $398.7 million in Q1 2022, an increase of $52.3 million or 13.1%.
- Adjusted EBITDA was $50.0 million in Q1 2023, compared to $29.1 million in Q1 2022, an increase of 71.9%.
- Net loss was $49.3 million in Q1 2023 compared to net income of $1.4 million in Q1 2022, a decrease of $50.7 million.
- Declared a quarterly dividend of $0.18 per share to be paid on July 17, 2023.
“We are pleased that our multi-faceted strategy to counter inflation is gaining traction as reflected by our strong first-quarter performance in 2023,” stated KP Tissue’s Chief Executive Officer, Dino Bianco. “Adjusted EBITDA increased nearly 72% year-over-year to $50 million on improved revenue of $451 million in the first quarter. These results were achieved mainly due to higher selling prices across all segments and regions, favourable sales mix, cost management initiatives implemented companywide, as well as ongoing productivity gains and our Memphis plant cost recovery.”
“Although we are still coping with volatile pulp prices and a weakened Canadian dollar, profitable growth remains our goal for 2023 and beyond. As the business strengthens, we intend to reinvest in our brands to drive share gains and take advantage of incremental manufacturing capacity from our Sherbrooke Expansion Project. The ramp-up of our bathroom tissue line exceeded expectations in the first quarter, while the start-up of our facial tissue and paper machine lines are scheduled for the fourth quarter of 2023 and end of 2024, respectively. As a result, we are steadily progressing along the road to recovery, while investing for the long-term,” Bianco added.
OUTLOOK FOR Q2 2023
Discussing near-term outlook, Bianco stated: “Looking ahead to the second quarter of 2023, while we believe inflationary pressure has stabilized and our operating efficiency continues to improve, we will be reinvesting in the business to drive long-term value. Accordingly, Adjusted EBITDA in Q2 2023 is expected to be in the range of Q1 2023.”
To read the full report and learn more about Kruger Products’ Q1 2023 financial results, click here.