Mercer(US:MERC)2025-02-20 21:34Financial Performance - Fourth quarter 2024 Operating EBITDA increased to $99.2 million, up from $21.1 million in Q4 2023 and $50.5 million in Q3 2024[2][6][17] - Net income for Q4 2024 was $16.7 million ($0.25 per share), a significant recovery from a net loss of $87.2 million (negative $1.31 per share) in Q4 2023[3][6] - Full year 2024 Operating EBITDA rose to $243.7 million, compared to a loss of $242.1 million in 2023[6] - Operating EBITDA increased to $243.7 million in 2024 from $17.5 million in 2023, driven by higher sales realizations in pulp, manufactured products, and lumber[36] - Operating income for the year ended December 31, 2024, was $15.0 million, compared to a loss of $188.8 million in 2023[50] Revenue Growth - Total revenues for Q4 2024 increased by approximately 4% to $488.4 million from $470.5 million in Q4 2023, driven by higher pulp sales realizations[15] - Pulp revenues in Q4 2024 increased to $351.2 million from $340.7 million in Q4 2023, with average NBSK pulp sales realizations up approximately 12% to $794 per ADMT[21][22] - Solid wood segment revenues increased by approximately 6% to $111.6 million in Q4 2024, primarily due to higher lumber and biofuels revenues[29] - Lumber revenues in Q4 2024 rose by approximately 23% to $58.6 million from $47.8 million in Q4 2023, driven by higher sales realizations and volumes[30] - Pulp segment revenues for Q4 2024 were $375.5 million, compared to $364.2 million in Q4 2023, while solid wood segment revenues were $111.6 million in Q4 2024, up from $105.4 million in Q4 2023[45] Cost Management - In 2024, costs and expenses decreased by approximately 7% to $2,028.4 million from $2,182.6 million in 2023, primarily due to lower per unit production costs and foreign exchange gains[35] - Long-term debt decreased to $1.47 billion in 2024 from $1.61 billion in 2023, a reduction of approximately 8%[52] - The company reduced long-term debt by over $100 million in Q4 2024, focusing on debt reduction as a key goal moving forward[12][14] Liquidity and Assets - As of December 31, 2024, total liquidity was approximately $488.6 million, consisting of $184.9 million in cash and cash equivalents and $303.7 million available under revolving credit facilities[37] - Total assets decreased to $2,262.9 million in 2024 from $2,662.6 million in 2023, while total shareholders' equity fell to $429.8 million from $635.4 million[38] - Cash and cash equivalents at the end of 2024 were $184.9 million, down from $314.0 million in 2023, a decrease of 41%[54] - Inventory levels decreased to $361.7 million in 2024 from $414.2 million in 2023, a reduction of about 13%[52] Future Outlook - The company expects modestly higher softwood pulp sales realizations in Q1 2025 due to stable demand and global supply constraints[4] - The company expects to achieve further synergies from the Torgau acquisition as market conditions improve[35] Dividends - A quarterly dividend of $0.075 per share is scheduled for payment on April 2, 2025, subject to Board approval[39] - The company declared dividends of $0.075 per common share for both Q4 2024 and Q4 2023, maintaining the same level[50] Production and Sales - Lumber production in Q4 2024 was 114.7 million board feet, with sales of 123.6 million board feet, indicating strong demand[47] - Biofuels production in 2024 was 160.4 thousand tonnes, with sales of 184.4 thousand tonnes, showing an increase from 144.8 thousand tonnes in 2023[47] Price Changes - The average NBSK pulp price in North America was $1,687 per ADMT in Q4 2024, compared to $1,312 per ADMT in Q4 2023, reflecting a significant price increase[47] Impairments - The company reported an impairment of $34.3 million related to goodwill in 2024, which was not present in 2023[54]