PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements for the three and six months ended June 30, 2025, and 2024, detailing operations, balance sheets, and cash flows, with a focus on the significant year-over-year decrease in net income and operating cash flow driven by lower net sales [Condensed Consolidated Statements of Operations](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income significantly declined in Q2 2025 to **$15 million** from **$83 million** year-over-year, primarily due to reduced net sales from **$933 million** to **$794 million** Consolidated Statements of Operations Highlights (in millions, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $794 | $933 | $1,615 | $1,838 | | **Income Before Income Taxes** | $20 | $113 | $53 | $173 | | **Net Income** | $15 | $83 | $42 | $126 | | **Diluted EPS** | $0.37 | $1.98 | $1.02 | $3.00 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased slightly to **$2,668 million** as of June 30, 2025, driven by growth in total equity to **$959 million**, despite a decrease in cash and temporary investments to **$113 million** Balance Sheet Summary (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and temporary investments** | $113 | $205 | | **Total Current Assets** | $977 | $1,063 | | **Total Assets** | $2,668 | $2,604 | | **Total Current Liabilities** | $635 | $682 | | **Long-Term Debt** | $767 | $782 | | **Total Liabilities** | $1,709 | $1,757 | | **Total Equity** | $959 | $847 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow for H1 2025 significantly decreased to **$87 million** from **$142 million** year-over-year, primarily due to lower net income, while investment and financing activities remained stable or decreased Cash Flow Summary - Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | **Cash Provided by Operating Activities** | $87 | $142 | | **Cash Used for Investment Activities** | $(114) | $(113) | | **Cash Used for Financing Activities** | $(76) | $(95) | | **Change in Cash** | $(92) | $(75) | | **Cash at End of Period** | $113 | $205 | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes disclose accounting policies, revenue recognition, debt, and contingent liabilities, highlighting decreased net sales across all geographic segments and an ongoing significant tax dispute in Brazil External Net Sales by Business Segment - Six Months Ended June 30 (in millions) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | Europe | $371 | $412 | | Latin America | $387 | $443 | | North America | $857 | $983 | | **Total** | **$1,615** | **$1,838** | - The company is involved in a long-standing tax dispute in Brazil regarding the deductibility of goodwill amortization from a 2007 acquisition. As of June 30, 2025, assessments totaled approximately **$108 million** in tax and **$278 million** in interest, penalties, and fees. Under an agreement, Sylvamo is responsible for **40%** of any assessment up to **$300 million**[49](index=49&type=chunk)[50](index=50&type=chunk) - Total long-term debt decreased slightly to **$767 million** as of June 30, 2025, from **$782 million** at year-end 2024. The company was in compliance with all debt covenants as of the reporting date[59](index=59&type=chunk)[70](index=70&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=21&type=section&id=Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%20(MD%26A)) Management discusses the significant Q2 2025 financial decline due to lower volumes, unfavorable European pricing, and higher maintenance costs, while Q3 anticipates continued price pressure but improved volume and reduced maintenance expenses, maintaining strong liquidity Q2 2025 vs Q2 2024 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Net Income** | $15 | $83 | | **Net Sales** | $794 | $933 | | **Adjusted EBITDA** | $82 | $164 | | **Free Cash Flow** | $(2) | $62 | - The decline in Q2 2025 earnings was attributed to decreased volume (primarily in North America), unfavorable price/mix in Europe, and significantly higher planned maintenance outage costs[90](index=90&type=chunk) - Q3 2025 Outlook: Management expects unfavorable price/mix, favorable volume from seasonality, stable input costs, and a **$66 million** improvement from having no planned maintenance outages[91](index=91&type=chunk) [Business Segment Results](index=21&type=section&id=Business%20Segment%20Results) All three business segments saw operating profit decline in Q2 2025, with Europe reporting a **$38 million** loss due to lower prices and higher maintenance, while Latin America and North America profits decreased due to lower volumes Business Segment Operating Profit (Loss) - Three Months Ended June 30 (in millions) | Segment | 2025 | 2024 | | :--- | :--- | :--- | | Europe | $(38) | $8 | | Latin America | $2 | $37 | | North America | $66 | $77 | | **Total** | **$30** | **$122** | - Europe's performance was negatively impacted by lower sales price/mix (**$16 million**) and higher planned maintenance outages (**$28 million**)[101](index=101&type=chunk) - North America's sales decrease of **$74 million** was primarily due to a **$78 million** decrease in volumes[110](index=110&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) Operating cash flow for H1 2025 decreased to **$87 million** due to lower net income, while capital spending remained consistent at **$114 million**, and **$36 million** in dividends and **$40 million** in share repurchases were executed - The decrease in operating cash flow in H1 2025 compared to H1 2024 was primarily due to lower net income, partially offset by changes in working capital[120](index=120&type=chunk) - Capital spending for H1 2025 totaled **$114 million**, with the largest portion (**$62 million**) allocated to the Latin America segment[123](index=123&type=chunk) - Financing activities in H1 2025 included paying **$36 million** in dividends and repurchasing **$40 million** of common stock[124](index=124&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk exposure have occurred since December 31, 2024, with detailed disclosures referenced from the 2024 Form 10-K - There have been no material changes in the Company's exposure to market risk since December 31, 2024[134](index=134&type=chunk) [Controls and Procedures](index=28&type=section&id=Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during Q2 2025 - Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[135](index=135&type=chunk) - No changes occurred in the company's internal control over financial reporting during Q2 2025 that have materially affected, or are reasonably likely to materially affect, its internal controls[136](index=136&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any legal proceedings expected to materially adversely affect its financial condition, referencing tax and contingent liability disclosures from financial statement notes - The company is not involved in any legal proceedings that it believes will result in a material adverse effect on its financial condition or results of operations[138](index=138&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the 2024 Form 10-K, except for an expanded discussion on significant risks from global economic, civil, and political conditions, including military conflicts and trade protection measures - The company's operations and performance are significantly dependent on global and regional economic, civil, and political conditions and stable trade relations[141](index=141&type=chunk) - Ongoing military conflicts, such as the war in Ukraine and conflicts in the Middle East, could have a material adverse effect, particularly on European operations, through transportation, energy, and supply chain disruptions[142](index=142&type=chunk) - The imposition of tariffs and other trade protection measures could disrupt cross-border flows of materials and products, increase costs, and negatively impact results[146](index=146&type=chunk) [Purchases of Equity Securities by the Issuer and Affiliated Purchasers](index=30&type=section&id=Item%202.%20Purchases%20of%20Equity%20Securities%20by%20the%20Issuer%20and%20Affiliated%20Purchasers) The company repurchased **362,824** shares in Q2 2025, with **$42 million** remaining available under the **$300 million** authorized share repurchase program as of June 30, 2025 Share Repurchases in Q2 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2025 | 674 | $67.07 | | May 2025 | 344,311 | $55.48 | | June 2025 | 17,839 | $53.82 | | **Total** | **362,824** | - | - As of June 30, 2025, **$42 million** remains available for repurchases under the **$300 million** share repurchase program. The company repurchased **$40 million** of shares during the first six months of 2025[150](index=150&type=chunk) [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents and certifications by principal executive and financial officers as required by Sarbanes-Oxley Act - The report includes certifications from the principal executive officer and principal financial officer pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002[151](index=151&type=chunk)

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $82 million with a margin of 10%, reflecting a planned maintenance outage cost of nearly $17 million, the largest in recent history [6][10] - Adjusted operating earnings were $0.37 per share, while free cash flow was negative $2 million due to lower adjusted EBITDA and slightly higher capital spending [6][7] - The company returned nearly $40 million to shareholders, including $18 million in dividends and $20 million in share repurchases [5][6] Business Line Data and Key Metrics Changes - Price and mix contributed positively by $12 million, driven by better mix in North America and Latin America, despite lower export sales [8] - Volume decreased by $9 million, primarily in North America, with operational challenges impacting production levels [9] - Operational performance improved, leading to favorable costs of $23 million, particularly in North America and Europe [9][10] Market Data and Key Metrics Changes - In Europe, demand decreased by 8% year over year, with industry capacity reduced by 7% due to machine closures [11] - Latin America saw a 2% decline in demand overall, with Brazil experiencing a 6% increase due to strong publishing demand [12] - North America reported stable apparent demand year over year, driven by a nearly 40% increase in imports [12][13] Company Strategy and Development Direction - The company is focused on uncoated free sheet paper, viewing it as a long-term opportunity and investing in competitive advantages [26][27] - Capital allocation strategy emphasizes maintaining a strong financial position, reinvesting in high-return projects, and returning cash to shareholders [18][20] - Major capital spending plans include $145 million in strategic projects at the Eastover mill, expected to generate significant incremental EBITDA [21][23] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenging industry conditions but expressed confidence in the company's financial position and ability to navigate cycles [68] - The outlook for the third quarter includes expected adjusted EBITDA of $145 million to $165 million, with improved operational performance anticipated [15][16] - Management is closely monitoring tariff situations and their impact on trade flows and pricing strategies [14][60] Other Important Information - The company has reduced its debt by about half, with a net debt to adjusted EBITDA ratio of 1.3 times, providing financial flexibility [20] - Green energy credits received in Q2 amounted to $8 million and are expected to recur throughout the year [55][57] Q&A Session Summary Question: Outlook for South America in Q3 and combined EBITDA expectations - Management expects continued improvement in Latin America due to seasonally increasing shipments and no planned outages [33] - Combined earnings for North and South America may be slightly less than last year due to weakness in other Latin American markets [35] Question: Update on Europe’s market conditions - Europe faces difficult market conditions driven by tariff impacts and weak demand, with a focus on improving competitive cost positions [39][40] Question: Trends in trade flows and pricing - Significant increases in imports into North America have created more supply, impacting pricing strategies [44][60] - The company has seen pressure on pricing due to increased imports and competitive behavior from other producers [62]

Financial Performance - Sylvamo's Adjusted EBITDA for Q2 2025 was $82 million, aligning with the company's outlook, despite a negative impact of $13 million from foreign exchange[13, 15] - Adjusted Operating Earnings per Share for Q2 2025 was $037, compared to $198 in Q2 2024 and $068 in Q1 2025[13] - Free Cash Flow for Q2 2025 was negative $2 million, a decrease from $62 million in Q2 2024 and negative $25 million in Q1 2025[13] - Sylvamo returned $38 million in cash to shareowners during the quarter[12] Market Dynamics - In the first half of 2025, Europe's uncoated freesheet demand decreased by 7%, Latin America's decreased by 8%, and North America's remained stable[17] - In the first half of 2025, Europe's uncoated freesheet supply decreased by 10%, while Latin America and North America remained stable[17] Strategic Investments and Debt Management - Sylvamo's gross debt has decreased from an initial $15 billion at spinoff to $08 billion as of June 2025[27] - The company is ramping up capital spending on high-return projects with an internal rate of return (IRR) exceeding 20%[29] - Planned maintenance outage costs for 2025 are projected to be $111 million[43] Regional Performance - Europe's Adjusted EBITDA was negative $30 million in Q2 2025, with an Adjusted EBITDA Margin of negative 17%[57] - Latin America's Adjusted EBITDA was $27 million in Q2 2025, with an Adjusted EBITDA Margin of 13%[57] - North America's Adjusted EBITDA was $85 million in Q2 2025, with an Adjusted EBITDA Margin of 20%[57]

[Earnings Release Overview](index=1&type=section&id=Earnings%20Release%20Overview) [Q2 2025 Performance Summary](index=1&type=section&id=Q2%202025%20Performance%20Summary) Sylvamo's Q2 2025 results aligned with outlook, with net income and Adjusted EBITDA declining due to increased maintenance and FX impacts, but cash flow improved Q2 2025 vs Q1 2025 Financial Highlights (in millions) | Metric | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Net Income | $15 | $27 | | Diluted EPS | $0.37 | $0.65 | | Adjusted Operating Earnings | $15 | $28 | | Adjusted EBITDA | $82 | $90 | | Adjusted EBITDA Margin | 10% | 11% | | Cash from Operating Activities | $64 | $23 | | Free Cash Flow | $(2) | $(25) | - Key performance drivers compared to Q1 2025 include: **favorable price and mix improved by $12 million**, operations and other costs were **favorable by $23 million**, **unfavorable planned maintenance outage expenses increased by $39 million**, and **volume decreased by $9 million**[6](index=6&type=chunk) - The company successfully navigated its heaviest planned maintenance outage quarter in over five years while overcoming a **$13 million unfavorable foreign exchange impact**[2](index=2&type=chunk) [Q3 2025 Outlook](index=1&type=section&id=Q3%202025%20Outlook) The company forecasts Q3 Adjusted EBITDA between $145 million and $165 million, driven by reduced maintenance expenses, stronger demand, and improved operations Q3 2025 Outlook vs. Q2 2025 (Projected Changes, in millions) | Metric | Projected Change | | :--- | :--- | | **Adjusted EBITDA** | **$145 - $165** | | Price and Mix | Decrease by $15 - $20 | | Volume | Improve by $15 - $20 | | Operations and Other Costs | Favorable by up to $5 | | Input and Transportation Costs | Stable ( $(5) - $5 ) | | Planned Maintenance Outages | Decrease by $66 | - Sylvamo is positioned for a stronger performance in the second half of the year, with **85% of full-year planned maintenance outages completed**[2](index=2&type=chunk) [Management Discussion and Analysis](index=1&type=section&id=Management%20Discussion%20and%20Analysis) Management highlighted navigating a challenging quarter with heavy maintenance, focusing on long-term value through strategic investments and shareholder returns, amidst varied regional market conditions - The company returned **$38 million to shareholders in Q2** through dividends and share repurchases, and a **third-quarter dividend of $0.45 per share** was declared[8](index=8&type=chunk) - Strategic investments at the Eastover, SC mill, including a **$100 million paper machine speed-up** and a **$45 million sheeter replacement**, are expected to generate over **$50 million in incremental annual Adjusted EBITDA**[12](index=12&type=chunk) Uncoated Freesheet Industry Conditions (H1 2025 vs H1 2024) | Region | Demand Trend | | :--- | :--- | | Europe | Down **8% YoY**, sluggish | | Latin America | Down **2% YoY** (Brazil up **6%**) | | North America | Apparent demand stable, driven by **~40% increase in imports** | [Financial Performance Analysis](index=3&type=section&id=Financial%20Performance%20Analysis) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) Consolidated financial statements reveal year-over-year declines in net sales and net income for Q2 and H1 2025, with increased total assets and equity but decreased cash and operating cash flow [Consolidated Statement of Operations](index=5&type=section&id=Consolidated%20Statement%20of%20Operations) Statement of Operations Summary (in millions) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $794 | $933 | $1,615 | $1,838 | | Cost of products sold | $640 | $684 | $1,302 | $1,400 | | Income Before Income Taxes | $20 | $113 | $53 | $173 | | Net Income | $15 | $83 | $42 | $126 | | Diluted EPS | $0.37 | $1.98 | $1.02 | $3.00 | [Consolidated Balance Sheet](index=9&type=section&id=Consolidated%20Balance%20Sheet) Balance Sheet Summary (in millions) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and temporary investments | $113 | $205 | | Total Current Assets | $977 | $1,063 | | Total Assets | $2,668 | $2,604 | | Total Current Liabilities | $635 | $682 | | Long-Term Debt | $767 | $782 | | Total Equity | $959 | $847 | [Consolidated Statement of Cash Flows](index=10&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) Statement of Cash Flows Summary (Six Months Ended June 30, in millions) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Cash Provided By Operating Activities | $87 | $142 | | Cash Used for Investing Activities | $(114) | $(113) | | Cash Used for Financing Activities | $(76) | $(95) | | Change in Cash | $(92) | $(75) | [Segment Performance](index=3&type=section&id=Segment%20Performance) In Q2 2025, North America was the sole profitable segment, improving to $66 million operating profit, while Europe and Latin America saw declines due to increased maintenance and unfavorable foreign exchange impacts Segment Results Q2 2025 vs Q1 2025 (in millions) | Segment | Net Sales Q2'25 | Operating Profit Q2'25 | Net Sales Q1'25 | Operating Profit Q1'25 | | :--- | :--- | :--- | :--- | :--- | | Europe | $181 | $(38) | $190 | $(24) | | Latin America | $207 | $2 | $199 | $26 | | North America | $419 | $66 | $438 | $42 | - North America's earnings were higher due to lower operating and input costs, favorable price and mix, and lower unabsorbed costs, which more than offset lower volumes and higher planned maintenance[23](index=23&type=chunk) - Europe's earnings were lower due to higher planned maintenance outages, unfavorable foreign exchange impacts, and lower volumes[21](index=21&type=chunk) - Latin America's earnings were lower due to higher planned maintenance outages and unfavorable foreign exchange impacts[22](index=22&type=chunk) [Non-GAAP Financial Measures Reconciliation](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) The company provides reconciliations for key non-GAAP measures, with Q2 2025 Adjusted EBITDA at $82 million and Free Cash Flow at $(2) million, showing sequential improvement but year-over-year declines Reconciliation of Net Income to Adjusted EBITDA (in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $15 | $27 | $83 | | Adjustments | $67 | $63 | $81 | | **Adjusted EBITDA** | **$82** | **$90** | **$164** | Reconciliation to Free Cash Flow (in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Cash Provided By Operating Activities | $64 | $23 | $115 | | Cash invested in capital projects | $(66) | $(48) | $(53) | | **Free Cash Flow** | **$(2)** | **$(25)** | **$62** | Q3 2025 Outlook: Net Income to Adjusted EBITDA Reconciliation (in millions) | Metric | Q3 2025 Estimate | | :--- | :--- | | Net Income | $59 - $74 | | Adjustments | $86 - $91 | | **Adjusted EBITDA** | **$145 - $165** |

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Sylvamo Corporation's unaudited condensed consolidated financial statements for Q1 2025 and 2024, including statements of operations, comprehensive income, balance sheets, cash flows, and detailed notes [Condensed Consolidated Statements of Operations](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Sylvamo reported Q1 2025 net sales of $821 million, a decrease from $905 million, with net income falling to $27 million and diluted EPS to $0.65 | Financial Metric | Q1 2025 (In millions) | Q1 2024 (In millions) | Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $821 | $905 | -9.3% | | **Income Before Income Taxes** | $33 | $60 | -45.0% | | **Net Income** | $27 | $43 | -37.2% | | **Basic EPS** | $0.66 | $1.04 | -36.5% | | **Diluted EPS** | $0.65 | $1.02 | -36.3% | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Q1 2025 comprehensive income significantly increased to $107 million from $6 million, primarily due to a positive $78 million foreign currency translation adjustment | Component (In millions) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net Income** | $27 | $43 | | **Change in cumulative foreign currency translation adjustment** | $78 | $(38) | | **Total Other Comprehensive Income (Loss), Net of Taxes** | $80 | $(37) | | **Comprehensive Income (Loss)** | $107 | $6 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets increased slightly to **$2,629 million**, and total equity rose to **$908 million**, driven by comprehensive income | Balance Sheet Item (In millions) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $1,011 | $1,063 | | **Total Assets** | $2,629 | $2,604 | | **Total Current Liabilities** | $616 | $682 | | **Long-Term Debt** | $794 | $782 | | **Total Liabilities** | $1,721 | $1,757 | | **Total Equity** | $908 | $847 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating cash flow decreased to $23 million, with $48 million used for capital projects and $31 million for financing, resulting in a $51 million net cash decrease | Cash Flow Activity (In millions) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Cash Provided by Operating Activities** | $23 | $27 | | **Cash Used for Investment Activities** | $(48) | $(60) | | **Cash Used for Financing Activities** | $(31) | $(35) | | **Change in Cash** | $(51) | $(71) | | **Cash at End of Period** | $154 | $209 | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, segment revenue, a Brazil tax dispute, debt structure, and segment operating profits, with $20 million in share repurchases and $19 million in dividends | Segment | Product | Q1 2025 Sales (In millions) | Q1 2024 Sales (In millions) | | :--- | :--- | :--- | :--- | | **Europe** | Uncoated Papers | $170 | $186 | | | Market Pulp | $20 | $21 | | **Latin America** | Uncoated Papers | $180 | $196 | | | Market Pulp | $13 | $12 | | **North America** | Uncoated Papers | $417 | $471 | | | Market Pulp | $21 | $19 | | **Total** | | **$821** | **$905** | - A significant tax dispute in Brazil regarding the deductibility of goodwill amortization from a 2007 acquisition remains ongoing. The total assessment is approximately **$103 million** in tax and **$260 million** in interest and penalties. Under an agreement, International Paper will pay **60%** and Sylvamo **40%** of any assessment up to **$300 million**[50](index=50&type=chunk)[51](index=51&type=chunk) - In Q1 2025, the company returned cash to shareholders through **$19 million** in dividends (**$0.45 per share**) and **$20 million** in share repurchases[31](index=31&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial results, noting decreased net income and sales due to lower volumes and unfavorable price/mix, and provides a Q2 2025 outlook with higher maintenance costs [Executive Summary](index=19&type=section&id=Executive%20Summary) Q1 2025 net income was **$27 million** on **$821 million** net sales, driven by lower volumes and unfavorable price/mix, with a Q2 2025 outlook of stable volumes but higher maintenance costs | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net Income** | $27 million | $43 million | | **Diluted EPS** | $0.65 | $1.02 | | **Net Sales** | $821 million | $905 million | | **Adjusted EBITDA** | $90 million | $118 million | | **Adjusted EBITDA Margin** | 11% | 13% | | **Free Cash Flow** | $(25) million | $(33) million | - Key performance drivers in Q1 2025 vs Q1 2024 included decreased volume (due to Georgetown mill closure and operational challenges), and lower price/mix in Europe[88](index=88&type=chunk) - The outlook for Q2 2025 projects stable volume, favorable price/mix, improved operations and costs, but a significant **$36 million** increase in planned maintenance outage costs[89](index=89&type=chunk) [Business Segment Results](index=19&type=section&id=Business%20Segment%20Results) Europe's operating profit decreased by **$20 million**, Latin America's increased by **$12 million**, and North America's decreased by **$20 million** due to varying regional factors - **Europe:** Operating profit decreased by **$20 million**, driven by lower sales price/mix (**$9 million**) and higher planned maintenance outage costs (**$12 million**)[97](index=97&type=chunk) - **Latin America:** Operating profit increased by **$12 million**, mainly due to lower outage costs (**$10 million**) and lower operating costs (**$6 million**)[100](index=100&type=chunk) - **North America:** Operating profit decreased by **$20 million**, primarily due to lower volumes (**$13 million** impact) and higher operating costs (**$7 million**)[103](index=103&type=chunk) Adjusted EBITDA Reconciliation This section reconciles non-GAAP measures, showing Q1 2025 Adjusted EBITDA of **$90 million** (11.0% margin) and Free Cash Flow of negative **$25 million** | In millions | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net Income** | $27 | $43 | | Income tax provision | $6 | $17 | | Interest (income) expense, net | $9 | $9 | | Depreciation, amortization, etc. | $40 | $39 | | Stock-based compensation | $6 | $7 | | Net special items expense | $2 | $3 | | **Adjusted EBITDA** | **$90** | **$118** | Free Cash Flow Reconciliation | In millions | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Cash provided by operating activities** | $23 | $27 | | Cash invested in capital projects | $(48) | $(60) | | **Free Cash Flow** | **$(25)** | **$(33)** | [Liquidity and Capital Resources](index=23&type=section&id=Liquidity%20and%20Capital%20Resources) Q1 2025 operating cash flow decreased to **$23 million**, capital spending reduced to **$48 million**, and the company plans **$225-$260 million** in total capital expenditures for 2025 - Cash provided by operating activities decreased to **$23 million** for Q1 2025, compared to **$27 million** for Q1 2024, primarily due to lower net income[110](index=110&type=chunk) - Capital spending decreased to **$48 million** in Q1 2025 from **$60 million** in Q1 2024[112](index=112&type=chunk)[113](index=113&type=chunk) - Financing activities in Q1 2025 included paying **$18 million** in dividends and repurchasing **$20 million** of shares[114](index=114&type=chunk) - The company plans total capital expenditures for 2025 to be between **$225 million** and **$260 million**, comprising maintenance/regulatory spending and high-return projects[116](index=116&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes in its market risk exposure since December 31, 2024, as disclosed in its 2024 Form 10-K - There have been no material changes in the Company's exposure to market risk since December 31, 2024[125](index=125&type=chunk) [Item 4. Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[126](index=126&type=chunk) - No changes in the company's internal control over financial reporting occurred in Q1 2025 that have materially affected, or are reasonably likely to materially affect, its internal controls[127](index=127&type=chunk) [PART II. OTHER INFORMATION](index=27&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=27&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any legal proceedings expected to materially adversely affect its financial condition, referencing tax and environmental matters in the financial statement notes - The company is not involved in any legal proceedings that it believes will result in a material adverse effect on its financial condition or results of operations[129](index=129&type=chunk) [Item 1A. Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's 2024 Form 10-K - No material changes have been made to the risk factors described in the 2024 Form 10-K[131](index=131&type=chunk) [Item 2. Purchases of Equity Securities by the Issuer and Affiliated Purchasers](index=27&type=section&id=Item%202.%20Purchases%20of%20Equity%20Securities%20by%20the%20Issuer%20and%20Affiliated%20Purchasers) During Q1 2025, the company repurchased **483,820** shares, including **285,472** shares for **$20 million** under its program, with **$62 million** remaining available | Period (2025) | Total Shares Purchased | Average Price Paid Per Share | Shares Purchased as Part of Program | | :--- | :--- | :--- | :--- | | January | 361 | $79.02 | — | | February | 230,601 | $70.20 | 230,601 | | March | 252,858 | $70.75 | 54,871 | | **Total** | **483,820** | | **285,472** | - The company repurchased **$20 million** of shares during Q1 2025. As of March 31, 2025, **$62 million** remains available under the total **$300 million** share repurchase program[133](index=133&type=chunk) [Item 6. Exhibits](index=28&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents, incentive plans, and required CEO/CFO certifications - The report includes certifications from the principal executive officer and principal financial officer as required by Section 302 of the Sarbanes-Oxley Act[134](index=134&type=chunk)

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $90 million with a margin of 11% for the first quarter, which was in line with the outlook of $85 million to $105 million [10][12] - Adjusted operating earnings were $0.68 per share, and free cash flow was lower than the previous quarter due to timing of payments and annual incentive compensation [10][12] - Free cash flow is expected to be heavily weighted to the second half of the year, with historical data showing nearly 90% generated in that period [10][11] Business Line Data and Key Metrics Changes - The company faced operational challenges in North America, impacting financial performance by approximately $10 million due to lower sales volume and operational costs [12][13] - Planned maintenance outage costs increased by $9 million due to major outages at specific mills [13][14] - Price and mix were unfavorable by $10 million, driven by lower pulp prices and paper price decreases in Europe, although partially offset by price increases in North America and Brazil [12][13] Market Data and Key Metrics Changes - In Europe, demand for uncoated freesheet decreased by 7% year-over-year, while Latin America saw a 3% increase, primarily driven by strong demand in Brazil [18][19] - North American apparent demand was down about 1% year-over-year, influenced by higher imports, which accounted for nearly 15% of overall supply [18][19] - The company anticipates real demand to decline by 3% to 4% for the year, with domestic industry supply reduced by 10% due to mill closures [19][20] Company Strategy and Development Direction - The company is focusing on improving its product mix and operational efficiency, particularly in Europe, where it plans to reduce costs and enhance capabilities at specific mills [22][23] - A new Senior Vice President and General Manager has been appointed to lead efforts in improving performance and customer relationships [22][23] - The company aims to leverage its global footprint to enhance product mix and customer service in North America while reducing exports to non-core markets [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about a global economic slowdown and potential inflation risks on raw materials and transportation costs, but believes these risks are manageable [24][25] - The company is well-positioned to navigate tariff uncertainties, with over 90% of raw materials sourced locally and minimal reliance on imports from China [26][27] - A significant improvement in adjusted EBITDA performance is expected in the second half of the year due to lower maintenance costs and improved commercial results [20][30] Other Important Information - The company has successfully reduced its debt by about half over the past three years, with a current leverage ratio of 1.1 times [28] - Capital allocation strategy focuses on maintaining a strong financial position while investing in business improvements and returning cash to shareholders [28][29] Q&A Session Summary Question: Can you provide more detail on the operational issues faced? - The operational issues were primarily reliability problems at the Ticonderoga and Eastover mills, with one intermittent issue expected to be resolved in the second quarter [36] Question: How do you expect to recover orders pushed into the third quarter? - The anticipated recovery in the third quarter could be less than $10 million, influenced by ongoing operational challenges and volume issues from the Riverdale mill [37][38] Question: What are the upgrades at SIAD and the market opportunities? - Upgrades at SIAD include investments in new capabilities to enter specialty segments, while opportunities at Newmola focus on improving operational efficiency and reducing wood costs [50][52] Question: How are tariffs affecting trade flows? - Tariffs have led to increased imports into the U.S. and decreased pulp prices in Europe, driven by reduced demand in China [57][58] Question: What is the outlook for capital spending for the year? - The company maintains its full-year capital spending guidance of $220 million to $240 million, with significant cash flow expected in the second half of the year [61][64]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $90 million with a margin of 11% for the first quarter [9] - Adjusted operating earnings were $0.68 per share, with free cash flow expected to be lower than the previous quarter due to timing issues [10][9] - The company returned nearly $40 million in cash to shareholders, including an $18 million dividend and $20 million in share repurchases [8] Business Line Data and Key Metrics Changes - The company faced operational challenges in North America, impacting financial performance by approximately $10 million [11] - Planned maintenance outage costs increased by $9 million due to major outages at specific mills [13] - Volume decreased by 30 million, primarily due to seasonally weak demand in Latin America and operational challenges in North America [12] Market Data and Key Metrics Changes - In Europe, demand decreased by 7% year-over-year, while Latin America saw a 3% increase in demand, mainly driven by Brazil [17] - North American apparent demand was down about 1% year-over-year, influenced by higher imports [17] - The company anticipates real demand to decline by 3% to 4% for the year, with domestic industry supply reduced by 10% due to mill closures [18] Company Strategy and Development Direction - The company plans to leverage its global footprint to improve product mix and customer service in North America [19] - A focus on reducing costs and improving product mix is emphasized, particularly in the European market [23] - The company aims for a significantly better adjusted EBITDA performance in the second half of the year, driven by lower maintenance costs and improved operations [20] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about a global economic slowdown and potential inflation risks on raw materials and transportation [24] - The company is well-positioned to manage through tariff uncertainties, with over 90% of raw materials sourced locally [26] - Future capital allocation strategies will focus on maintaining a strong financial position while investing in business growth [28] Other Important Information - The company has reduced its debt significantly, with a leverage ratio now at 1.1 times, and has no major maturities until 2027 [14] - A seamless CEO and CFO succession plan is in place as the current CEO prepares for retirement [31] Q&A Session Summary Question: Can you provide more detail on the operational issues? - The operational issues were primarily reliability problems at the Ticonderoga and Eastover mills, with an intermittent issue expected to be resolved soon [37] Question: How do you expect to recover orders in the third quarter? - The company anticipates a benefit of less than $10 million from recovering orders that were pushed into the third quarter due to operational challenges [39] Question: What upgrades are being made at the Saia mill? - Investments in new capabilities at the Saia mill will allow entry into specialty roll segments, improving product mix [50] Question: How are you addressing wood cost increases at the Newmala mill? - Strategies include sourcing directly from landowners and importing lower-cost wood, targeting at least a 10% reduction in wood costs [53] Question: What is the outlook for capital spending for the year? - The company maintains its full-year capital spending guidance of $220 million to $240 million, with significant cash flow expected in the second half of the year [62][63]

[Q1 2025 Earnings Overview](index=1&type=section&id=Q1%202025%20Earnings%20Overview) Sylvamo's Q1 2025 results showed a significant decline in net income and Adjusted EBITDA compared to Q4 2024, driven by unfavorable pricing, lower volumes, and increased costs [Financial & Operational Highlights (Q1 2025 vs Q4 2024)](index=1&type=section&id=Financial%20%26%20Operational%20Highlights%20(Q1%202025%20vs%20Q4%202024)) Sylvamo's first-quarter 2025 results showed a significant decline compared to the fourth quarter of 2024, with net income falling to $27 million from $81 million and Adjusted EBITDA decreasing to $90 million from $157 million. The downturn was driven by unfavorable pricing and mix, lower volumes, and increased operational and maintenance costs Q1 2025 vs Q4 2024 Financial Highlights (in millions) | Financial Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Income | $27 | $81 | | Diluted EPS | $0.65 | $1.94 | | Adjusted Operating Earnings | $28 | $82 | | Adjusted EBITDA | $90 | $157 | | Adjusted EBITDA Margin | 11% | 16% | | Cash from Operating Activities | $23 | $164 | | Free Cash Flow | $(25) | $100 | - Key factors contributing to the sequential decline in performance include: - **Price and Mix:** Unfavorable by **$10 million**, mainly due to price decreases in Europe and Brazilian export regions[5](index=5&type=chunk) - **Volume:** Decreased by **$30 million**, reflecting seasonal weakness in Latin America and operational challenges in North America[5](index=5&type=chunk) - **Costs:** Operations and other costs increased by **$12 million**, planned maintenance rose by **$9 million**, and input/transportation costs grew by **$6 million**[5](index=5&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management completed heavy maintenance, reaffirmed capital allocation, and announced a CEO transition, while acknowledging global economic risks but expressing confidence in the company's resilience - The company returned nearly **$40 million** to shareholders in Q1, consisting of an **$18 million** dividend and **$20 million** in share repurchases[5](index=5&type=chunk)[6](index=6&type=chunk) - **$62 million** remains on the current share repurchase authorization[6](index=6&type=chunk) - Management identifies a global economic slowdown due to tariffs and inflation as key risks but believes they are manageable due to a strong balance sheet (**1.1x leverage ratio**) and a localized supply chain, with over **90%** of raw materials sourced locally[7](index=7&type=chunk)[8](index=8&type=chunk)[9](index=9&type=chunk) - A senior leadership transition is underway: Chairman and CEO Jean-Michel Ribiéras will retire at year-end[10](index=10&type=chunk) - John Sims, former CFO, became COO on May 1 and will become CEO on Jan 1, 2026[11](index=11&type=chunk) - Don Devlin was appointed as the new SVP and CFO on May 1[12](index=12&type=chunk) [Second Quarter 2025 Outlook](index=1&type=section&id=Second%20Quarter%202025%20Outlook) Sylvamo projects Q2 2025 Adjusted EBITDA between $75 million and $95 million, with increased maintenance expenses partially offset by expected improvements in pricing, operations, and input costs Q2 2025 Outlook vs. Q1 2025 (in millions) | Metric | Expected Change vs. Q1 2025 | | :--- | :--- | | **Adjusted EBITDA** | **$75M - $95M** | | Price and Mix | Improve by $5M - $10M | | Volume | Stable ($-5M to +$5M) | | Operations & Other Costs | Improve by $10M - $15M | | Input & Transportation Costs | Improve by $5M - $10M | | Planned Maintenance Outage | Increase by $36M | - Q2 will be the heaviest maintenance outage quarter of the year[4](index=4&type=chunk) - By mid-year, over **80%** of the total annual planned maintenance outage costs will have been spent[4](index=4&type=chunk) - The company expects quarterly earnings to significantly improve in the second half of the year, benefiting from lower planned maintenance expenses, improved commercial results, and better operations[5](index=5&type=chunk) [Financial Performance Analysis](index=3&type=section&id=Financial%20Performance%20Analysis) This section provides a detailed analysis of Sylvamo's Q1 2025 consolidated financial statements, including the Statement of Operations, Balance Sheet, and Statement of Cash Flows [Consolidated Financial Results](index=3&type=section&id=Consolidated%20Financial%20Results) This section provides a detailed look at Sylvamo's consolidated financial statements for Q1 2025. It includes the Statement of Operations, Balance Sheet, and Statement of Cash Flows, showing a comprehensive picture of the company's financial health, operational results, and liquidity during the quarter [Consolidated Statement of Operations](index=5&type=section&id=Consolidated%20Statement%20of%20Operations) The Consolidated Statement of Operations details Sylvamo's revenue, costs, and net income for Q1 2025, showing a sequential decline in profitability Q1 2025 Income Statement Highlights (vs. Q4 2024, in millions) | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Sales | $821 | $970 | | Cost of products sold | $662 | $733 | | Income Before Income Taxes | $33 | $100 | | Net Income | $27 | $81 | | Diluted EPS | $0.65 | $1.94 | [Consolidated Balance Sheet](index=9&type=section&id=Consolidated%20Balance%20Sheet) The Consolidated Balance Sheet presents Sylvamo's assets, liabilities, and equity as of March 31, 2025, indicating changes in liquidity and financial structure Balance Sheet Summary (as of March 31, 2025, in millions) | Metric | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and temporary investments | $154 | $205 | | Total Current Assets | $1,011 | $1,063 | | Total Assets | $2,629 | $2,604 | | Total Current Liabilities | $616 | $682 | | Long-Term Debt | $794 | $782 | | Total Equity | $908 | $847 | [Consolidated Statement of Cash Flows](index=10&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) The Consolidated Statement of Cash Flows outlines Sylvamo's cash generation and usage from operating, investing, and financing activities in Q1 2025 Q1 2025 Cash Flow Summary (in millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Cash Provided By Operating Activities | $23 | $27 | | Cash Used for Investing Activities | $(48) | $(60) | | Cash Used for Financing Activities | $(31) | $(35) | | Change in Cash | $(51) | $(71) | - Key financing activities in Q1 2025 included **$18 million** in dividend payments and **$20 million** in common stock repurchases[47](index=47&type=chunk) [Business Segment Performance](index=3&type=section&id=Business%20Segment%20Performance) All three business segments experienced a sequential decline in operating profit in Q1 2025. Europe reported an operating loss of $24 million, a sharp drop from a $3 million profit in Q4 2024, driven by higher costs and unfavorable pricing. Latin America's profit fell to $26 million from $50 million due to lower volumes and unfavorable mix. North America's profit decreased to $42 million from $56 million, primarily due to lower volumes and higher costs Net Sales by Business Segment (Q1 2025 vs Q4 2024, in millions) | Segment | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Europe | $190 | $194 | | Latin America | $199 | $266 | | North America | $438 | $514 | | **Total Net Sales** | **$821** | **$970** | Operating Profit by Business Segment (Q1 2025 vs Q4 2024, in millions) | Segment | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Europe | $(24) | $3 | | Latin America | $26 | $50 | | North America | $42 | $56 | | **Total Segment Operating Profit** | **$44** | **$109** | - **Europe:** Earnings were lower due to higher operating/input costs, planned maintenance, and unfavorable price/mix[18](index=18&type=chunk) - **Latin America:** Lower volumes, unfavorable price/mix, and higher costs drove the earnings decline[18](index=18&type=chunk)[19](index=19&type=chunk) - **North America:** Earnings were down due to lower volumes and higher operating/input costs[18](index=18&type=chunk)[20](index=20&type=chunk) [Other Financial Information](index=3&type=section&id=Other%20Financial%20Information) The reported effective tax rate for Q1 2025 was 18%, slightly lower than Q4 2024, primarily due to a discrete tax benefit from stock-based compensation, with net special items resulting in a $1 million charge - The reported effective tax rate was **18%** for Q1 2025, compared to **19%** for Q4 2024[21](index=21&type=chunk) - The lower rate was driven by a higher stock-based compensation windfall[21](index=21&type=chunk) - Excluding net special items, the effective tax rate for Q1 2025 was **20%**, compared with **19%** for Q4 2024[22](index=22&type=chunk) - Net special items in Q1 2025 amounted to a net after-tax charge of **$1 million** (**$0.03 per diluted share**)[24](index=24&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=6&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section provides reconciliations of Sylvamo's non-GAAP financial measures, including Adjusted Operating Earnings, Adjusted EBITDA, and Free Cash Flow, to their most directly comparable GAAP measures [Reconciliation to Adjusted Operating Earnings](index=6&type=section&id=Reconciliation%20to%20Adjusted%20Operating%20Earnings) The company reported Adjusted Operating Earnings of $28 million ($0.68 per share) for Q1 2025, a decrease from $82 million ($1.96 per share) in Q4 2024. This non-GAAP measure is derived by adjusting Net Income for net special items Reconciliation of Net Income to Adjusted Operating Earnings (in millions) | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Income | $27 | $81 | | Add back: Net special items | $1 | $1 | | **Adjusted Operating Earnings** | **$28** | **$82** | [Reconciliation to Adjusted EBITDA](index=8&type=section&id=Reconciliation%20to%20Adjusted%20EBITDA) Adjusted EBITDA for Q1 2025 was $90 million with an 11.0% margin, down from $157 million and a 16.2% margin in Q4 2024. The reconciliation from Net Income adds back taxes, interest, D&A, stock-based compensation, and special items. All segments saw a sequential decline in Adjusted EBITDA Reconciliation of Net Income to Adjusted EBITDA (in millions) | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Net Income | $27 | $81 | | Adjustments (Taxes, Interest, D&A, etc.) | $63 | $76 | | **Adjusted EBITDA** | **$90** | **$157** | | **Adjusted EBITDA Margin** | **11.0%** | **16.2%** | Adjusted EBITDA by Business Segment (in millions) | Segment | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Europe | $(15) | $14 | | Latin America | $46 | $70 | | North America | $59 | $73 | | **Total** | **$90** | **$157** | [Reconciliation to Free Cash Flow](index=11&type=section&id=Reconciliation%20to%20Free%20Cash%20Flow) Free Cash Flow was negative $25 million in Q1 2025, a significant decrease from a positive $100 million in Q4 2024, driven by lower operating cash and capital project investments Reconciliation of Cash Provided by Operations to Free Cash Flow (in millions) | Metric | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Cash Provided By Operating Activities | $23 | $164 | | Cash invested in capital projects | $(48) | $(64) | | **Free Cash Flow** | **$(25)** | **$100** |

Financial Performance - Sylvamo's Adjusted EBITDA for Q1 2025 was $90 million, down from $157 million in Q4 2024 and $118 million in Q1 2024[20] - Adjusted Operating Earnings per Share for Q1 2025 was $068, compared to $196 in Q4 2024 and $107 in Q1 2024[20] - Free Cash Flow for Q1 2025 was negative $25 million, a decrease from $100 million in Q4 2024 and an increase from negative $33 million in Q1 2024[20] - Net debt stood at approximately $650 million as of March 31, 2025, resulting in a net debt-to-Adjusted EBITDA ratio of 11x[33] Operational Highlights - The company successfully executed a heavy planned maintenance outage quarter, with 82% of planned maintenance outage costs to be completed in the first half of 2025, totaling $110 million for the year[19, 25, 69] - Industry demand in Europe (excluding CIS countries) decreased by 7%, while Latin America saw an increase of 3% and North America experienced a decrease of 1% in Q1 2025 compared to Q1 2024[28] Strategic Initiatives and Outlook - Sylvamo is implementing previously communicated UFS price increases in Brazil and North America[19] - The company is focused on reducing costs, repositioning its product mix, and improving efficiency in its European operations, particularly at the Nymolla mill[29] - Sylvamo anticipates total maintenance outage costs of $110 million for 2025[47] Leadership Transition - John Sims was elected Chief Operating Officer (COO) effective May 1, 2025, and will assume the role of Chief Executive Officer (CEO) on January 1, 2026, following Jean-Michel Ribiéras's retirement[15] - Don Devlin was named Senior Vice President and CFO, effective May 1, 2025[12]

Core Insights - Sylvamo Corporation (NYSE: SLVM) shares have increased by 20.36% year-over-year [1] - The company reported Q4 2024 revenue of $970 million, reflecting a 0.62% year-over-year increase [1] - For the full fiscal year 2024, Sylvamo's revenue rose to $3.773 billion, marking a 1.4% year-over-year growth [1]