RAYONIER ADVANCED MATERIALS INC.
For the period ended Sep 27, 2025. Filed Nov 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 27, 2025 · Filed Nov 5, 2025
RYAM$5.90-9.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-28; filed 2025-08-06.
0001597672-25-000036
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-27; filed 2025-11-05.
0001597672-25-000047
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 132 previous paragraphs and 142 current paragraphs.
71 unchanged; 38 reworded; 33 added; 22 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 30 previous and 30 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (33)
Current report
Recent Business Developments
Current report
•In August 2025, RYAM and USW jointly filed petitions with the USITC and the USDOC alleging that Brazilian and Norwegian producers of HPDP are selling into the U.S. market at unfairly low prices or with the benefit of government subsidies, causing material injury to the U.S. HPDP industry and its workers.
Current report
In September 2025, the USITC issued an affirmative injury determination, advancing the case to the USDOC, where preliminary determinations are expected in the first half of 2026. The Commission’s decision represents an important step toward restoring fair competition in the U.S. market and promoting greater pricing stability going forward.
Current report
•In October 2025, we expanded our Kallima® portfolio with the introduction of an enhanced freezer application for folding carton board. Engineered to withstand temperatures as low as -18°C (0°F), it maintains structural integrity and resists delamination in freezer conditions. Its natural resistance to moisture and condensation — without coatings or plastic extrusion — delivers cost efficiency, ease of converting and sustainability benefits. This innovation comes as the frozen food market continues to grow worldwide, driven by consumer demand for convenience and extended shelf life. With the Enhanced Freezer Application, RYAM provides packaging manufacturers with a solution that safeguards product integrity while delivering on sustainability and operational efficiency.
Current report
We continue to expect a strong finish to 2025, with annual Adjusted EBITDA projected to approximate $135 million to $140 million, inclusive of the $12 million non-cash environmental charge taken in the first quarter, supported by stable Cellulose Specialties operations, improved order trends and continued cost discipline. Adjusted Free Cash Flow is expected to approximate $25 million to $30 million in the fourth quarter, reflecting improved working capital conversion and stronger financial performance as orders continue to normalize.
Current report
Looking ahead, we expect to more than double EBITDA over the next two years. This growth will be driven by multi-year Cellulose Specialties price actions, continued efficiency gains and structural cost reductions targeting approximately $30 million in annual savings by 2026. Beyond 2026, we are also evaluating incremental cost saving opportunities, with initiatives under review that could deliver up to $20 million of additional annual savings in 2027. In addition, Biomaterials projects are expected to add approximately $31 million of run-rate proportional EBITDA exiting 2027. Collectively, these actions reinforce RYAM’s long-term strategy and our path to achieve over $300 million in run-rate EBITDA by the end of 2027, with further upside as the AGE project comes online in late 2028.
Current report
We remain committed to disciplined capital allocation and cash management. The previously announced process to explore a potential sale of our Paperboard and High-Yield Pulp businesses remains in flux given current market dynamics, evolving trade conditions and ongoing discussions related to the renewal of the US-Mexico-Canada Agreement in July 2026. We continue to engage opportunistically with interested parties as inbound inquiries arise, while evaluating options that best support long-term value creation and balance sheet deleveraging.
Current report
Overall, EBITDA is expected to approximate $227 million to $230 million for the full year 2025, subject to additional impacts from tariffs.
Current report
•We are evaluating a prebiotics facility at our Jesup plant. In July 2025, we received Generally Recognized As Safe status for our prebiotics product with a letter of no objection from the U.S. Food and Drug Administration. A Memorandum of Understanding has been signed with a feed additive manufacturer for the U.S. poultry and swine feed segments. Live animal tests of the prebiotics products showed over two times greater efficacy versus an existing prebiotics additive.
Current report
Overall, EBITDA is expected to approximate $7 million for the full year 2025.
Current report
Overall, EBITDA is expected to approximate a loss of $13 million to $15 million for the full year 2025, subject to additional impacts from tariffs.
Current report
Overall, EBITDA is expected to approximate $13 million for the full year 2025.
Current report
Overall, EBITDA is expected to approximate a loss of $27 million for the full year 2025.
Current report
Overall, Corporate costs are expected to approximate $70 million for the full year 2025.
Current report
Operating results for the quarter ended September 27, 2025 improved $26 million, or 153 percent, compared to the same prior year quarter primarily driven by the prior year quarter’s $25 million non-cash asset impairment and $7 million in one-time indefinite suspension costs, as well as lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations, favorable foreign exchange rates, lower variable compensation costs and an $8 million energy cost benefit from sales of excess emission allowances in the current quarter. Partially offsetting these improvements were the decrease in net sales and higher operating costs due to operational challenges, primarily at the Tartas cellulose plant, and French national labor strikes in the current quarter.
Current report
Also included in other income, net during the nine months ended September 27, 2025 was a $2 million increase to our liability related to SWEN’s put option for its quarterly fair value remeasurement.
Current report
The effective tax rate on the loss from continuing operations for the quarter ended September 27, 2025 was a benefit of 72 percent, which differed from the federal statutory rate of 21 percent primarily due to valuation allowances on nondeductible U.S. interest expense, state taxes, return-to-accrual adjustments and different statutory tax rates in foreign jurisdictions.
Current report
Net sales of our Cellulose Specialties segment for the quarter ended September 27, 2025 decreased $28 million, or 12 percent, compared to the same prior year quarter driven by a 17 percent decrease in sales volumes that was driven by larger customer orders in the prior year quarter in advance of the indefinite suspension of Temiscaming cellulose operations as well as weaker demand in the current quarter due to continued customer destocking in the acetate market that was further accelerated by ongoing global tariff impacts. Partially offsetting the sales volume decrease was a 7 percent increase in average sales price driven by negotiated price increases and sales mix.
Current report
Net sales of our Cellulose Specialties segment for the nine months ended September 27, 2025 decreased $65 million, or 10 percent, compared to the same prior year period driven by a 12 percent decrease in sales volumes due to larger customer orders in the prior year period in advance of the indefinite suspension of Temiscaming cellulose operations as well as weaker demand in the current year period due to continued customer destocking in the acetate market that was further accelerated by ongoing global tariff impacts. Partially offsetting the sales volume decrease was a 4 percent increase in average sales price driven by negotiated price increases and sales mix.
Current report
Operating income of our Cellulose Specialties segment for the quarter ended September 27, 2025 increased $3 million, or 7 percent, compared to the same prior year quarter driven by the higher average sales price, lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations and a $7 million energy cost benefit from sales of excess emission allowances in the current quarter, the prior year sales of which occurred in the fourth quarter. Partially offsetting these improvements were the lower sales volumes, higher operating costs due to operational challenges, primarily at our Tartas cellulose plant, and French national labor strikes also impacting Tartas production in the current quarter.
Current report
Operating Income - Nine Months Ended
Current report
Net sales of our Biomaterials segment for the nine months ended September 27, 2025 decreased $1 million, or 5 percent, compared to the same prior year period driven by lower lignin sales volumes due to the prior year indefinite suspension of Temiscaming cellulose operations, partially offset by higher bioethanol sales volumes due to the prior year period having only two quarters of sales following the commencement of production of the new facility in March.
Current report
Operating Income - Nine Months Ended
Current report
Net sales of our Cellulose Commodities segment for the quarter ended September 27, 2025 decreased $1 million, or 1 percent, compared to the same prior year quarter driven by a 2 percent decrease in sales volumes due to lower production levels and resulting prioritization of available production to Cellulose Specialties, and the absence of Temiscaming sales in the current quarter due to the indefinite suspension of operations in the previous year, which were largely offset by increased viscose sales volumes for inventory management. The decrease in sales volumes was largely offset by an 8 percent increase in average sales price driven by higher fluff pricing and sales mix.
Current report
Net sales of our Cellulose Commodities segment for the nine months ended September 27, 2025 decreased $48 million, or 18 percent, compared to the same prior year period driven by a 19 percent decrease in sales volumes due to the reduction of Temiscaming sales as a result of the prior year indefinite suspension of operations and lower production levels due to operational challenges and labor strikes at our Tartas cellulose plant. The lower sales volumes were partially offset by a 5 percent increase in average sales price driven by higher fluff pricing and sales mix.
Current report
Operating loss of our Cellulose Commodities segment for the quarter ended September 27, 2025 improved $42 million, or 76 percent, compared to the same prior year quarter primarily driven by a $25 million non-cash asset impairment and $7 million in one-time indefinite suspension costs in the prior year quarter, the higher average sales price and lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations.
Current report
Operating Loss - Nine Months Ended
Current report
Operating loss of our Cellulose Commodities segment for the nine months ended September 27, 2025 improved $59 million, or 63 percent, compared to the same prior year period driven by a $25 million non-cash asset impairment and $14 million in one-time indefinite suspension costs in the prior year, the higher average sales price, lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations and reduced volumes of negative margin sales. Partially offsetting these improvements were higher costs due to lower productivity resulting from operational challenges and labor strikes at the Tartas cellulose plant, and the one-time prior year recognition of $2 million in CEWS benefit claims.
Current report
Operating results of our Paperboard segment for the quarter ended September 27, 2025 declined $11 million, or 157 percent, compared to the same prior year quarter driven by the lower sales, higher fixed costs due to the current quarter market-driven downtime and the impact of Temiscaming net custodial site costs, partially offset by lower purchased pulp costs.
Current report
Operating Income (Loss) - Nine Months Ended
Current report
Operating results of our Paperboard segment for the nine months ended September 27, 2025 declined $33 million, or 122 percent, compared to the same prior year period driven by the lower sales, higher fixed costs due to the current quarter market-driven downtime, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims.
Current report
Operating Income (Loss) - Nine Months Ended
Current report
We do not provide a reconciliation of forward-looking EBITDA, Adjusted EBITDA and Adjusted Free Cash Flow to their most directly comparable GAAP financial measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations. These amounts may be material and could result in the projected GAAP financial measure being materially different than the projected non-GAAP measure. As such, reconciliations for our forward-looking non-GAAP financial measures are not available without unreasonable effort.
Removed paragraphs (22)
Previous report
Our business has been significantly impacted by several extraordinary and primarily non-recurring challenges during the first half of the year, including global trade disruptions, tariff-driven market volatility, operational challenges, softer demand in Paperboard and High-Yield Pulp, a non-cash environmental charge and foreign exchange headwinds.
Previous report
While these near-term pressures weighed on second quarter results, they are largely considered to have peaked in the period. Since May, order trends in Cellulose Specialties have improved month over month and operational performance across our cellulose facilities has remained broadly stable. With signs of normalization emerging, RYAM is positioned to rebuild momentum in the second half of the year.
Previous report
Looking ahead, we expect to meaningfully grow EBITDA over the two years following 2025, supported by focused efforts to increase Cellulose Specialties sales volume from the expected market demand growth, expand Cellulose Specialties margins by increasing prices and investing in high return cost reduction projects and accelerate high-return investments in Biomaterials. These actions are core to RYAM’s long-term strategy.
Previous report
We remain committed to disciplined capital allocation. As previously disclosed, we began a process to explore the sale of our Paperboard and High-Yield Pulp businesses; however, given current market conditions and trade-related uncertainty, the process is now effectively on hold.
Previous report
Operating results for the quarter ended June 28, 2025 declined $29 million, or 104 percent, compared to the same prior year quarter driven primarily by the decrease in net sales, lower production due to operational challenges and the labor strike at the Tartas cellulose plant in the current quarter, unfavorable foreign exchange rates and the one-time prior year recognition of $10 million in CEWS benefit claims. Partially offsetting these decreases were lower indefinite suspension charges and lower variable compensation costs.
Previous report
Net sales of our Cellulose Specialties segment for the quarter ended June 28, 2025 decreased $33 million, or 14 percent, compared to the same prior year quarter driven by a 15 percent decrease in sales volumes that was in line with expectations and due primarily to a pause in customer orders driven by uncertainty surrounding imposed tariffs, strong sales in the prior year quarter ahead of the indefinite suspension of Temiscaming cellulose operations in July 2024 and the impact of the labor strike at the Tartas cellulose plant in the current quarter. Partially offsetting the sales volume decrease was a 3 percent increase in sales prices.
Previous report
Net sales of our Cellulose Specialties segment for the six months ended June 28, 2025 decreased $37 million, or 8 percent, compared to the same prior year period driven by a 9 percent decrease in sales volumes due primarily to a pause in customer orders driven by uncertainty surrounding imposed tariffs, strong sales in the prior year period ahead of the indefinite suspension of Temiscaming cellulose operations and the impact of the labor strike at the Tartas cellulose plant in the current period. Partially offsetting the sales volume decrease was a 3 percent increase in sales prices.
Previous report
Operating income of our Cellulose Specialties segment for the quarter ended June 28, 2025 decreased $21 million, or 42 percent, compared to the same prior year quarter driven by the lower sales volumes, higher key input costs, lower production due to operational challenges and the labor strike at the Tartas cellulose plant, and the one-time prior year recognition of $3 million in CEWS benefit claims.
Previous report
Operating Income - Six Months Ended
Previous report
Net sales of our Biomaterials segment for the six months ended June 28, 2025 decreased $1 million, or 7 percent, compared to the same prior year period driven by lower production due to operational challenges and the impact of the labor strike at the Tartas cellulose plant in the current period, which limited raw material supply due to the bioethanol facility’s reliance on the Tartas cellulose plant for feedstock.
Previous report
Operating Income - Six Months Ended
Previous report
Net sales of our Cellulose Commodities segment for the quarter ended June 28, 2025 decreased $26 million, or 31 percent, compared to the same prior year quarter driven by a 33 percent decrease in sales volumes due primarily to lower non-fluff commodity sales and the impact of the labor strike at the Tartas cellulose plant, partially offset by a 7 percent increase in sales prices driven by market supply dynamics for fluff.
Previous report
Net sales of our Cellulose Commodities segment for the six months ended June 28, 2025 decreased $47 million, or 26 percent, compared to the same prior year period driven by a 26 percent decrease in sales volumes due primarily to lower non-fluff commodity sales and the impact of the labor strike at the Tartas cellulose plant, partially offset by a 4 percent increase in sales prices driven by market supply dynamics for fluff.
Previous report
Operating loss of our Cellulose Commodities segment for the quarter ended June 28, 2025 improved $12 million, or 57 percent, compared to the same prior year quarter driven by lower non-fluff commodity losses, lower indefinite suspension charges and lower key input costs, partially offset by lower production due to operational challenges and the labor strike at the Tartas cellulose plant, and the one-time prior year recognition of $2 million in CEWS benefit claims.
Previous report
Operating Loss - Six Months Ended
Previous report
Operating loss of our Cellulose Commodities segment for the six months ended June 28, 2025 improved $17 million, or 44 percent, compared to the same prior year period driven by lower non-fluff commodity losses, lower indefinite suspension charges and lower key input costs, partially offset by lower production due to operational challenges and the labor strike at the Tartas cellulose plant, and the one-time prior year recognition of $2 million in CEWS benefit claims.
Previous report
Operating Income (Loss) - Six Months Ended
Previous report
Operating results of our Paperboard segment for the six months ended June 28, 2025 declined $22 million, or 110 percent, compared to the same prior year period driven by the lower sales, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims.
Previous report
Operating Income (Loss) - Six Months Ended
Previous report
EBITDA from continuing operations for the quarter ended June 28, 2025 decreased $34 million, or 56 percent, compared to the same prior year quarter. EBITDA from continuing operations for the six months ended June 28, 2025 decreased $69 million, or 61 percent, compared to the same prior year period. The decreases in these periods were driven primarily by the decrease in net sales, lower production due to operational challenges and the labor strike at the Tartas cellulose plant in the current period, unfavorable foreign exchange rates and the one-time prior year recognition of $10 million in CEWS benefit claims. Also driving the decrease in the year-to-date period were current period non-cash environmental reserves charges of $12 million. Partially offsetting the decreases in both periods were lower indefinite suspension charges and lower variable compensation costs.
Previous report
See Results of Operations above for additional discussion of the changes in our operating results.
Previous report
Adjusted free cash flow decreased $121 million compared to the prior year period primarily due to the decline in operating results and higher custodial capital expenditures. See Liquidity and Capital Resources—Cash Flows above for additional discussion of our operating cash flows and capital expenditures.
Reworded paragraphs (38)
Previous wording
Average cellulose specialties sales prices in 2025 are expected to increase by a mid single-digit percentage compared to the prior year. Sales volumes are anticipated to decline by a high single-digit percentage, reflecting tariff impacts, accelerated destocking of acetate and the absence of 2024 bridge volumes following the indefinite suspension of production at the Temiscaming plant. Acetate demand remains soft due to tariff-driven impacts, accelerated customer destocking and weaker global cigarette market trends. Ethers volumes are anticipated to improve, while demand for other cellulose specialties grades remains strong, supported by tight global supply conditions. Raw material input and logistics costs are expected to increase moderately year-over-year. All cellulose plants are currently running at expected operating rates.
Current wording
Sales prices in the fourth quarter are expected to bring the full year 2025 average price to a mid single-digit percentage above the prior year average. Sales volumes are anticipated to decline approximately 10 percent, reflecting tariff impacts, accelerated destocking of acetate and the absence of 2024 bridge volumes following the indefinite suspension of production at the Temiscaming plant. Acetate demand remains soft due to tariff-driven impacts, accelerated customer destocking and weaker global cigarette market trends. Ethers volumes are anticipated to improve, while demand for other cellulose specialties grades is mixed — strong in food and pharma end use applications but weak in automotive sectors. Raw material input and logistics costs are expected to increase moderately year-over-year.
Previous wording
We continue to evaluate investments in new green energy and renewable products to provide both increased end-market diversity and incremental profitability. We intend to proceed only with those projects that are expected to meet our investment hurdles: a minimum 30 percent return on equity and a less than two-year payback period for RYAM equity. In the fourth quarter of 2024, we secured green capital of €67 million, which allows us to advance the biomaterials strategy and further progress towards our goal of generating over $70 million of EBITDA from RYAM’s Biomaterials business, inclusive of the projects summarized below:
Current wording
We continue to evaluate investments in new green energy and renewable products to provide both increased end-market diversity and incremental profitability. We intend to proceed only with those projects that are expected to meet our investment hurdles: a minimum 30 percent return on equity and a less than two-year payback period for RYAM equity. In the fourth quarter of 2024, we secured green capital of €67 million, which allows us to advance the biomaterials strategy and further progress towards our goal of generating over $80 million of proportional EBITDA from RYAM’s Biomaterials business, inclusive of the projects summarized below:
Previous wording
•We continue to pursue an investment in a bioethanol facility in Fernandina Beach, Florida, similar to our bioethanol facility in France. While the City of Fernandina Beach recently denied the site plan application for this project, we believe the City erred in making its determination and we are pursuing all available legal remedies. In expectation of a favorable outcome, we continue to advance engineering plans and explore potential commercial agreements.
Current wording
•We continue to advance engineering and commercial planning for a potential bioethanol facility in Fernandina Beach, Florida, similar to our bioethanol operation in France. Although the City of Fernandina Beach denied the site plan application earlier in 2025, we believe the decision was made in error and we are pursuing available administrative and legal avenues. We remain confident in the project’s merits and continue preparatory work to position for timely execution once approvals are secured.
Previous wording
•We are evaluating investments in crude tall oil facilities in Jesup, Georgia and Tartas and a prebiotics facility at the Jesup plant, and are currently working on permitting, engineering and commercial agreements for these new facilities. In July 2025, we received GRAS status for our prebiotics product with a letter of no objection from the U.S. Food and Drug Administration.
Current wording
•We are evaluating investments in CTO facilities in Jesup, Georgia and Tartas, France, and are currently working on permitting, engineering and commercial agreements for these new facilities. In September 2025, we purchased high-quality CTO plant equipment that will be used for the Jesup CTO project.
Previous wording
•We are a partner in AGE, a start-up entity that aims to utilize renewable forestry waste and other biomass generally discarded as waste to generate green electricity for the State of Georgia from a new facility to be constructed adjacent to our Jesup plant. Although the project remains in the development phase, AGE is actively evaluating the construction and financing requirements for the new facility.
Current wording
•We are a partner in AGE, a start-up entity that aims to utilize renewable forestry waste and other biomass generally discarded as waste to generate green electricity for the State of Georgia from a new facility to be constructed adjacent to our Jesup plant. Although the project remains in the development phase, construction planning is complete, the air permit has been obtained and an Engineering, Procurement and Construction agreement has been executed. AGE is actively evaluating financing options to advance the project toward a final investment decision.
Previous wording
•We recently signed Memoranda of Understanding with Verso Energy to explore eSAF opportunities at both our Jesup and Tartas facilities, and with GranBio to develop a pilot-scale SAF plant at the Jesup site.
Current wording
•We recently signed Memoranda of Understanding with Verso Energy to explore eSAF opportunities at both our Jesup and Tartas facilities, and with GranBio to develop a pilot-scale ethanol-to-jet plant at the Jesup site to be fully funded by a U.S. Department of Energy grant. Together with GranBio, we are currently conducting due diligence on the feasibility of this project.
Previous wording
We expect to make final investment decisions on several of these projects in 2025.
Current wording
We expect to make final investment decisions on these projects in 2025 and early 2026.
Previous wording
Chinese retaliatory tariffs continue to disrupt global fluff market dynamics, creating a mismatch between supply and demand. As a result, RYAM’s production is being actively shifted toward non-fluff commodities until RYAM’s new dissolving wood pulp fluff product is fully qualified in China. While demand remains uncertain, we will continue to adjust production mix to mitigate the impact of direct tariffs and related second-order effects. Raw material input and logistics costs are expected to increase moderately.
Current wording
Chinese retaliatory tariffs continue to disrupt global fluff market dynamics, creating a mismatch between supply and demand. As a result, RYAM’s production is being actively shifted toward non-fluff commodities. While demand remains uncertain, we will continue to adjust production mix to mitigate the impact of direct tariffs and related second-order effects. Raw material input and logistics costs are expected to increase moderately.
Previous wording
Paperboard sales volumes are expected to remain soft due to continued economic uncertainty and weaker customer demand. Additionally, prices are expected to decline year-over-year, reflecting increased competitive activity from new U.S. competitor capacity. Input costs are projected to rise as a result of higher purchased pulp prices, increased allocation of Temiscaming custodial site costs and ongoing tariff mitigation efforts. In response to ongoing market weakness and a softer sales outlook, we are idling Paperboard production for two weeks during the third quarter as a proactive measure to align inventory levels with demand and preserve cash flow.
Current wording
Paperboard sales volumes are expected to remain soft due to continued economic uncertainty and weaker customer demand. The North American shipment to capacity ratio is below analysts’ projections for 2025. Additionally, average sales price is expected to decline year-over-year, reflecting increased competitive activity from European Union imports and new U.S. competitor capacity. Input costs are projected to rise due to higher purchased pulp prices and increased allocation of Temiscaming net custodial site costs. In response to ongoing market weakness and a softer sales outlook, we are idling Paperboard production for three weeks during the fourth quarter as a proactive measure to align inventory levels with demand and preserve cash flow.
Previous wording
High-Yield Pulp sales prices and volumes are expected to decline in 2025, driven primarily by continued oversupply in the Chinese market. Input costs are also projected to rise due to a higher allocation of custodial site costs at the Temiscaming facility. Given the ongoing market weakness, we continue to take proactive steps to manage production and costs. In response to ongoing market weakness and a softer sales outlook, we are idling High-Yield Pulp production for three weeks during the third quarter to proactively manage inventory levels and preserve cash flow.
Current wording
High-Yield Pulp average sales price and sales volumes are expected to remain low in the fourth quarter of 2025, driven primarily by continued oversupply in the Chinese market. Input costs are also projected to rise due to a higher allocation of net custodial site costs at the Temiscaming facility. Given the ongoing market weakness, we continue to take proactive steps to manage production and costs. In response to ongoing market weakness and a softer sales outlook, we are idling one of our two High-Yield Pulp production lines for three weeks during the fourth quarter to proactively manage inventory levels and preserve cash flow.
Previous wording
Net sales for the quarter and six months ended June 28, 2025 decreased $79 million, or 19 percent, and $111 million, or 14 percent, respectively, compared to the same prior year periods driven by lower sales prices in Paperboard and High-Yield Pulp and lower sales volumes across all segments that were largely a response to imposed tariffs and a labor strike at the Tartas cellulose plant in the current quarter. Partially offsetting the decrease in sales volumes were higher sales prices in Cellulose Specialties and Cellulose Commodities.
Current wording
Net sales for the quarter and nine months ended September 27, 2025 decreased $48 million, or 12 percent, and $159 million, or 13 percent, respectively, compared to the same prior year periods driven by lower average sales prices in Paperboard and High-Yield Pulp and lower sales volumes across all segments that were largely a response to imposed tariffs, lower Temiscaming sales in the current periods due to the indefinite suspension of operations in the previous year, increased competitive activity, operational challenges and labor strikes at the Tartas cellulose plant in the current year. These decreases were partially offset by higher average sales prices in Cellulose Specialties and Cellulose Commodities that were driven by negotiated price increases and sales mix.
Previous wording
Operating results for the six months ended June 28, 2025 declined $61 million, or 136 percent, compared to the same prior year period driven primarily by the decrease in net sales, lower production due to operational challenges and the labor strike at the Tartas cellulose plant in the current period, current period non-cash environmental reserves charges of $12 million, unfavorable foreign exchange rates and the one-time prior year recognition of $10 million in CEWS benefit claims. Partially offsetting these decreases were lower indefinite suspension charges and lower variable compensation costs.
Current wording
Operating results for the nine months ended September 27, 2025 declined $35 million, or 125 percent, compared to the same prior year period driven primarily by the decrease in net sales, higher costs due to lower productivity resulting from operational challenges and labor strikes at the Tartas cellulose plant, current period non-cash environmental reserves charges of $12 million, unfavorable foreign exchange rates and the one-time prior year recognition of $10 million in CEWS benefit claims. Partially offsetting these declines were the prior year’s $25 million non-cash asset impairment and $14 million in one-time indefinite suspension costs, lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations, lower variable compensation costs and an $8 million energy cost benefit from sales of excess emission allowances in the current year.
Previous wording
Interest expense for the quarter and six months ended June 28, 2025 increased $2 million and $5 million, respectively, compared to the same prior year periods driven primarily by an increase in the average effective interest rate on debt, partially offset by a decrease in the average outstanding principal balance. Total debt decreased $32 million from June 29, 2024 to June 28, 2025.
Current wording
Interest expense for the quarter and nine months ended September 27, 2025 increased $5 million and $10 million, respectively, compared to the same prior year periods primarily driven by an increase in the average effective interest rate on debt.
Previous wording
Unfavorable foreign exchange rates during the quarter and six months ended June 28, 2025 compared to favorable rates in the same prior year periods resulted in net unfavorable impacts of $2 million and $3 million, respectively.
Current wording
Unfavorable foreign exchange rates during the nine months ended September 27, 2025 compared to favorable rates in the same prior year period resulted in a net unfavorable impact of $2 million.
Previous wording
The effective tax rates on the loss from continuing operations for the quarter and six months ended June 28, 2025 were not meaningful as a result of the valuation allowance placed on our Canadian DTAs. Also driving the differences between the effective tax rates and the federal statutory rate of 21 percent were different statutory tax rates in foreign jurisdictions, valuation allowances on nondeductible U.S. interest expense, U.S. tax credits and nondeductible executive compensation.
Current wording
The effective tax rate on the loss from continuing operations for the nine months ended September 27, 2025 was not meaningful as a result of the valuation allowance placed on our Canadian DTAs in the second quarter. Also driving the difference between the effective tax rate and the federal statutory rate of 21 percent were different statutory tax rates in foreign jurisdictions, valuation allowances on nondeductible U.S. interest expense, U.S. tax credits and nondeductible executive compensation.
Previous wording
The effective tax rates on income from continuing operations for the quarter and six months ended June 29, 2024 were benefits of 11 percent and 21 percent, respectively. These rates differed from the federal statutory rate of 21 percent primarily due to the release of certain tax reserves, return-to-accrual adjustments, excess deficit on vested stock compensation and changes in the valuation allowance on disallowed interest deductions.
Current wording
The effective tax rates on the loss from continuing operations for the quarter and nine months ended September 28, 2024 were benefits of 13 percent and 19 percent, respectively. These rates differed from the federal statutory rate of 21 percent primarily due to changes in the valuation allowance on disallowed interest deductions, the release of certain tax reserves, different statutory tax rates in foreign jurisdictions, U.S. tax credits, excess deficit on vested stock compensation and return-to-accrual adjustments.
Previous wording
During the quarter and six months ended June 28, 2025, we recorded pre-tax income from discontinued operations of $4 million related to the remaining CEWS benefit claims deferred since 2021.
Current wording
During the nine months ended September 27, 2025, we recorded pre-tax income from discontinued operations of $4 million related to the remaining CEWS benefit claims deferred since 2021.
Previous wording
During the quarter and six months ended June 29, 2024, we recorded pre-tax income from discontinued operations of $5 million related to CEWS benefit claims deferred since 2021 and a pre-tax loss of $1 million on the sale of our softwood lumber duty refund rights.
Current wording
During the nine months ended September 28, 2024, we recorded pre-tax income from discontinued operations of $5 million related to CEWS benefit claims and a pre-tax loss of $1 million on the sale of our softwood lumber duty refund rights.
Previous wording
Operating income of our Cellulose Specialties segment for the six months ended June 28, 2025 decreased $27 million, or 31 percent, compared to the same prior year period driven by the lower sales volumes, higher key input costs, lower production due to operational challenges and the labor strike at the Tartas cellulose plant, and the one-time prior year recognition of $3 million in CEWS benefit claims.
Current wording
Operating income of our Cellulose Specialties segment for the nine months ended September 27, 2025 decreased $24 million, or 18 percent, compared to the same prior year period driven by the lower sales volumes, higher wood and chemicals costs, higher operating costs due to lower production efficiency, including labor strikes at the Tartas cellulose plant, and the one-time prior year recognition of $3 million in CEWS benefit claims. Partially offsetting these decreases were the increase in average sales price, lower fixed costs due to the indefinite suspension of Temiscaming cellulose operations and the $7 million energy cost benefit from sales of excess emission allowances in the current year, the prior year sales of which occurred in the fourth quarter.
Previous wording
Net sales of our Biomaterials segment for the quarter ended June 28, 2025 decreased $2 million, or 25 percent, compared to the same prior year quarter driven by lower production due to operational challenges and the impact of the labor strike at the Tartas cellulose plant in the current quarter, which limited raw material supply due to the bioethanol facility’s reliance on the Tartas cellulose plant for feedstock.
Current wording
Net sales of our Biomaterials segment for the quarter ended September 27, 2025 were flat compared to the same prior year quarter driven by higher turpentine sales that were offset by lower bioethanol sales volumes due to operational challenges and French national labor strikes at our Tartas cellulose plant in the current quarter, which limited raw material supply due to the bioethanol facility’s reliance on the plant for feedstock.
Previous wording
Operating income of our Biomaterials segment for the quarter ended June 28, 2025 was flat compared to the same prior year quarter as higher shared and ancillary service costs under the business’s newly established cost structure were offset by lower production costs as a result of the current quarter operational challenges and labor strike at the Tartas cellulose plant that reduced feedstock availability.
Current wording
Operating income of our Biomaterials segment for the quarter ended September 27, 2025 decreased $2 million, or 67 percent, compared to the same prior year quarter primarily driven by higher shared and ancillary service costs under the business’s newly established cost structure.
Previous wording
Operating income of our Biomaterials segment for the six months ended June 28, 2025 was flat compared to the same prior year period as higher shared and ancillary service costs under the business’s newly established cost structure were offset by lower production costs as a result of the current period operational challenges and labor strike at the Tartas cellulose plant that reduced feedstock availability.
Current wording
Operating income of our Biomaterials segment for the nine months ended September 27, 2025 decreased $2 million, or 33 percent, compared to the same prior year period driven by the lower sales and higher shared and ancillary service costs under the business’s newly established cost structure, partially offset by lower production costs as a result of the current year operational challenges and labor strikes at the Tartas cellulose plant that reduced feedstock availability.
Previous wording
Net sales of our Paperboard segment for the quarter ended June 28, 2025 decreased $13 million, or 22 percent, compared to the same prior year quarter. Sales prices and volumes decreased 3 percent and 23 percent, respectively, driven by mix, shifting customer dynamics associated with tariff uncertainty and increased competitive activity due to increased European Union imports and the start-up of new U.S. capacity.
Current wording
Net sales of our Paperboard segment for the quarter ended September 27, 2025 decreased $16 million, or 29 percent, compared to the same prior year quarter. Average sales price and sales volumes decreased 10 percent and 21 percent, respectively, driven by mix, shifting customer dynamics associated with tariff uncertainty and increased competitive activity due to increased European Union imports and the start-up of new U.S. capacity.
Previous wording
Net sales of our Paperboard segment for the six months ended June 28, 2025 decreased $17 million, or 15 percent, compared to the same prior year period. Sales prices and volumes decreased 4 percent and 12 percent, respectively, driven by mix, shifting customer dynamics associated with tariff uncertainty and increased competitive activity due to increased European Union imports and the start-up of new U.S. capacity.
Current wording
Net sales of our Paperboard segment for the nine months ended September 27, 2025 decreased $33 million, or 20 percent, compared to the same prior year period. Average sales price and sales volumes decreased 6 percent and 15 percent, respectively, driven by mix, shifting customer dynamics associated with tariff uncertainty and increased competitive activity in the first two quarters of 2025 due to increased European Union imports and the start-up of new U.S. capacity.
Previous wording
(a)External sales only. During the quarters ended June 28, 2025 and June 29, 2024, the High-Yield Pulp segment sold 17,000 MTs and 16,000 MTs of high-yield pulp to the Paperboard segment for $7 million each period, respectively. During the six months ended June 28, 2025 and June 29, 2024, the High-Yield Pulp segment sold 33,000 MTs and 32,000 MTs of high-yield pulp to the Paperboard segment for $14 million and $13 million, respectively.
Current wording
(a)External sales only. During the quarters ended September 27, 2025 and September 28, 2024, the High-Yield Pulp segment sold 14,000 MTs and 15,000 MTs of high-yield pulp to the Paperboard segment for $6 million and $7 million, respectively. During each of the nine months ended September 27, 2025 and September 28, 2024, the High-Yield Pulp segment sold 47,000 MTs of high-yield pulp to the Paperboard segment for $20 million.
Previous wording
Net sales of our High-Yield Pulp segment for the quarter ended June 28, 2025 decreased $4 million, or 12 percent, compared to the same prior year quarter. Sales prices and volumes decreased 11 percent and 7 percent, respectively, driven by lower demand, including in China where demand for all grades of market pulp were down, continued oversupply in China and the timing of shipments, primarily related to shipping challenges to customers in India.
Current wording
Net sales of our High-Yield Pulp segment for the quarter ended September 27, 2025 decreased $4 million, or 14 percent, compared to the same prior year quarter. Average sales price and sales volumes decreased 10 percent and 8 percent, respectively, driven by lower demand, including in China where demand for all grades of market pulp were down, continued oversupply of domestic high-yield pulp in China and the timing of shipments, primarily related to shipping challenges to customers in India.
Previous wording
Net sales of our High-Yield Pulp segment for the six months ended June 28, 2025 decreased $7 million, or 10 percent, compared to the same prior year period. Sales prices and volumes decreased 9 percent and 5 percent, respectively, driven by lower demand, including in China where demand for all grades of market pulp were down, continued oversupply in China and the timing of shipments, primarily related to shipping challenges to customers in India.
Current wording
Net sales of our High-Yield Pulp segment for the nine months ended September 27, 2025 decreased $11 million, or 12 percent, compared to the same prior year period. Average sales price and sales volumes decreased 10 percent and 5 percent, respectively, driven by lower demand, including in China where demand for all grades of market pulp were down, continued oversupply of domestic high-yield pulp in China, increased competitive activity due to the start-up of new Indonesian capacity late in 2024 and the timing of shipments, primarily related to shipping challenges to customers in India.
Previous wording
Operating results of our Paperboard segment for the quarter ended June 28, 2025 declined $12 million, or 100 percent, compared to the same prior year quarter driven by the lower sales, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims.
Current wording
Operating results of our High-Yield Pulp segment for the quarter ended September 27, 2025 declined $10 million, or 100 percent, compared to the same prior year quarter driven by the lower sales, higher fixed costs due to the current quarter market-driven downtime and the impact of Temiscaming net custodial site costs.
Previous wording
Operating results of our High-Yield Pulp segment for the six months ended June 28, 2025 declined $14 million, or 100%, compared to the same prior year period driven by the lower sales, higher logistics costs, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims. These negative impacts were partially offset by lower wood costs.
Current wording
Operating results of our High-Yield Pulp segment for the nine months ended September 27, 2025 declined $24 million, or 100 percent, compared to the same prior year period driven by the lower sales, higher fixed costs due to the current quarter market-driven downtime, higher logistics costs, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims. These negative impacts were partially offset by lower wood costs.
Previous wording
The Corporate operating loss for the quarter ended June 28, 2025 was flat compared to the same prior year quarter as lower variable compensation costs and a decrease in costs related to our ERP implementation were offset by unfavorable foreign exchange rates in the current quarter compared to favorable rates in the prior year quarter.
Current wording
The Corporate operating loss for the quarter ended September 27, 2025 improved $4 million, or 22 percent, compared to the same prior year quarter primarily driven by lower variable compensation costs and favorable foreign exchange rates in the current quarter compared to unfavorable rates in the prior year quarter.
Previous wording
The Corporate operating loss for the six months ended June 28, 2025 declined $15 million compared to the same prior year period driven by first quarter non-cash environmental reserves charges of $12 million and unfavorable foreign exchange rates in the current period compared to favorable rates in the prior year period, partially offset by lower variable compensation costs. The environmental reserves charges are associated with recent developments at the Port Angeles, Washington, and Augusta, Georgia, remediation sites. The cash impact associated with the Augusta remediation site is expected in early 2027; the cash impact for the Port Angeles remediation site is not expected to begin before 2028, with outflows in the following three to five years.
Current wording
The Corporate operating loss for the nine months ended September 27, 2025 declined $11 million, or 25 percent, compared to the same prior year period driven by first quarter non-cash environmental reserves charges of $12 million and unfavorable foreign exchange rates in the current period compared to favorable rates in the prior year period, partially offset by lower variable compensation costs. The environmental reserves charges are associated with recent developments at the Port Angeles, Washington, and Augusta, Georgia, remediation sites. The cash impact associated with the Augusta remediation site is expected in early 2027; the cash impact for the Port Angeles remediation site is not expected to begin before 2028, with outflows in the following three to five years.
Previous wording
(a)Amounts available under the ABL Credit Facility fluctuate based on eligible accounts receivable and inventory levels. At June 28, 2025, we had $154 million of gross availability and net available borrowings of $116 million after taking into account outstanding letters of credit of $26 million. In addition to the availability under the ABL Credit Facility, we have $15 million available under our accounts receivable factoring line of credit in France.
Current wording
(a)Amounts available under the ABL Credit Facility fluctuate based on eligible accounts receivable and inventory levels. At September 27, 2025, we had $162 million of gross availability and net available borrowings of $53 million after taking into account the facility’s quarter end balance of $59 million, outstanding letters of credit of $26 million and required availability of $24 million to avoid triggering the facility’s fixed charge coverage ratio covenant.
Previous wording
Our principal contractual commitments include standby letters of credit, surety bonds, guarantees, purchase obligations and leases. We utilize arrangements such as standby letters of credit and surety bonds to provide credit support for certain suppliers and vendors in case of their default on critical obligations, collateral for certain of our self-insurance programs and guarantees for the completion of our remediation of environmental liabilities. As part of our ongoing operations, we also periodically issue guarantees to third parties. Our primary purchase obligation payments relate to natural gas, electricity and wood chips purchase contracts. There have been no material changes outside the ordinary course of business to the purchase obligations presented in our 2024 Form 10-K during the six months ended June 28, 2025. See Note 18—Commitments and Contingencies to our Financial Statements for further information.
Current wording
Our principal contractual commitments include standby letters of credit, surety bonds, guarantees, purchase obligations and leases. We utilize arrangements such as standby letters of credit and surety bonds to provide credit support for certain suppliers and vendors in case of their default on critical obligations, collateral for certain of our self-insurance programs and guarantees for the completion of our remediation of environmental liabilities. As part of our ongoing operations, we also periodically issue guarantees to third parties. Our primary purchase obligation payments relate to natural gas, electricity and wood chips purchase contracts. There have been no material changes outside the ordinary course of business to the purchase obligations presented in our 2024 Form 10-K during the nine months ended September 27, 2025. See Note 19—Commitments and Contingencies to our Financial Statements for further information.
Previous wording
Cash provided by operating activities decreased $89 million compared to the prior year period primarily due to the decline in operating results, the one-time prior year proceeds of $39 million from the sale of our softwood lumber duty refund rights and lower income tax net refunds, partially offset by net cash inflows from working capital in the current year compared to net outflows in the prior year and lower interest paid on long-term debt due to the timing of payments.
Current wording
Cash provided by operating activities decreased $157 million compared to the prior year period primarily due to the decline in operating results, the one-time prior year proceeds of $39 million from the sale of our softwood lumber duty refund rights and $20 million in income tax net refunds in the prior year compared to less than $1 million in net payments in the current year. These outflows were partially offset by lower outflows for working capital and lower interest paid on long-term debt due to the timing of payments. The tariff volatility and operational disruptions causing significant headwinds in the first half of the year peaked in the second quarter, with the third quarter showing increasing stabilization across demand, operational performance and costs.
Previous wording
Cash used in investing activities increased $17 million compared to the prior year period as higher custodial capital spend was partially offset by decreased strategic capital spend.
Current wording
Cash used in investing activities increased $17 million compared to the prior year period as higher custodial capital spend and our third quarter contribution to AGE were partially offset by decreased strategic capital spend and current year proceeds from our insurance claim related to the fire at our Jesup plant in the fourth quarter of 2024.
Previous wording
Cash inflows from financing activities increased $2 million compared to the prior year period due to higher net borrowings of long-term debt and the prior year payment of debt issuance costs, partially offset by higher net repayments of short-term financing and higher repurchases of common stock to satisfy tax withholding requirements.
Current wording
Cash inflows from financing activities increased $57 million compared to the prior year period due to net borrowings of short- and long-term debt in the current period compared to net repayments in the prior period and lower debt issuance costs, partially offset by higher repurchases of common stock to satisfy tax withholding requirements related to stock-based compensation.
Previous wording
Cash provided by operating activities is reconciled to adjusted free cash flow as follows:
Current wording
Cash provided by (used in) operating activities is reconciled to Adjusted Free Cash Flow as follows:
Previous wording
(a)Net of proceeds from the sale of assets and excluding strategic capital expenditures. Strategic capital expenditures for the six months ended June 28, 2025 and June 29, 2024 were $13 million and $28 million, respectively.
Current wording
(a)Net of proceeds from the sale of assets and insurance claims, and excluding strategic capital expenditures. Strategic capital expenditures for the nine months ended September 27, 2025 and September 28, 2024 were $20 million and $30 million, respectively.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Operating results of our High-Yield Pulp segment for the quarter ended June 28, 2025 declined $8 million compared to the same prior year quarter driven by the lower sales, higher logistics costs, the impact of Temiscaming net custodial site costs and the one-time prior year recognition of $2 million in CEWS benefit claims.