US' Glatfelter posts net sales of $378 million in Q1

With this refinancing, the company meaningfully extended its debt maturity profile, with no material debt coming due prior to the maturity of the revolving credit facility in September 2026, the company said in a press release.

“The actions we completed this quarter, combined with the improvement in adjusted EBITDA, are strong indications of the progress we are making to turn around our business and drive greater profitability," said Thomas Fahnemann, president and chief executive officer of Glatfelter. “The fundamentals of our composite fibres and airlaid materials segments remain strong as demonstrated by the quarter-over-quarter growth in profitability for both segments despite a continued difficult economic environment. And, although volumes increased in spunlace, we did not see a sequential increase in profitability compared to the fourth quarter due to a challenged product mix."

"We continue to aggressively drive improvements in our business and recently announced senior leadership changes that combine accountability for commercial and global supply chain into a single role to achieve greater alignment and improved efficiency across these important functions. Also, I have commissioned the formation of a product management function to gain greater category-level focus on strengthening product differentiation and innovation, maximising customer value, and ultimately driving sustainable margin improvement. These changes are the next natural steps in executing our turnaround strategy, along with the ongoing work to address the overall performance of the spunlace segment," said Fahnemann.

“We are in a much stronger position today as a result of the combined impact of improvements to our business operations, product portfolio, leadership team and balance sheet," said Fahnemann. “We have established the foundation needed to turn around and transform the Company, and I remain confident we will generate between $110 million-$120 million in adjusted EBITDA for 2023 as we continue to strive toward earnings growth and ultimately realising our full potential.”

Airlaid materials’ first quarter net sales increased $10 million in the year-over-year comparison mainly driven by higher selling prices from cost pass-through arrangements with customers and pricing actions to recover significant inflation in raw materials and energy. Shipments were 7.5 per cent lower mainly due to feminine hygiene and tabletop categories and currency translation was unfavourable by $3.4 million.

Airlaid Materials’ first quarter EBITDA of $21.6 million was $1.8 million higher when compared to the first quarter of 2022. Lower shipments were mostly offset by favourable mix, lowering results by $0.1 million. Selling price increases and energy surcharges of $20.5 million more than offset higher raw material and energy costs of $18.1 million. Operations were unfavourable by $1.3 million mainly driven by lower production to manage customer demand as some customers slowed ordering patterns to manage inventory levels built up at the end of 2022 to avoid anticipated energy and supply chain disruptions in the beginning of 2023. The impact of currency and related hedging positively impacted earnings by $0.8 million, the company said in a press release.

Composite Fibres’ revenue was $3.2 million lower in the first quarter of 2023, compared to the year-ago quarter as lower shipments of 12.0 per cent and unfavourable currency translation of $5.9 million was partially offset by higher selling prices of $12.0 million.

Composite Fibres had EBITDA for the first quarter of $10.1 million compared with $6.2 million EBITDA in the first quarter of 2022. Higher selling prices and energy surcharges more than offset the continued inflation in energy, raw material, and freight and were a net favourable benefit to results of $3.5 million. Lower shipments negatively impacted income by $1.6 million as all product categories were down compared to the same quarter last year reflecting softening demand from inflationary pressures and wallcover shipments were additionally impacted by the Russia/Ukraine conflict. Operations were favourable $1.4 million mainly driven by headcount actions taken related to the turnaround strategy as well as lower energy consumption due to lower production volume to match customer demand. The impact of currency and related hedging positively impacted earnings by $0.6 million.

Spunlace revenue was $9.7 million lower in the first quarter of 2023, compared to the year-ago quarter as lower shipments of 20.8 per cent and unfavourable currency translation of $1.4 million were partially offset by higher selling prices of $12.0 million.

Spunlace had an EBITDA of $1.1 million in the first quarter of this year compared with an EBITDA of $1.3 million in the first quarter of 2022. Higher selling prices and energy surcharges fully offset the higher raw material and energy costs favourably impacting earnings by $3.2 million. Volume was unfavourable $2.1 million driven by lower shipments in almost all categories. Operations were unfavourable $1.1 million mainly driven by lower production but partially offset by headcount actions taken in 2022 to improve segment profitability. The impact of currency negatively impacted earnings by $0.2 million, the release added.

Fibre2Fashion News Desk (RR)