Mercer(US:MERC)2025-11-06 21:33Financial Performance - In Q3 2025, Mercer International Inc. reported Operating EBITDA of negative $28.1 million, a decrease from positive $50.5 million in Q3 2024[2] - The net loss for Q3 2025 was $80.8 million ($1.21 per share), compared to a net loss of $17.6 million ($0.26 per share) in Q3 2024[2] - Total revenues for Q3 2025 decreased by approximately 9% to $458.1 million from $502.1 million in Q3 2024, primarily due to lower pulp and manufactured products sales realizations[14] - Operating loss for Q3 2025 was $67.6 million compared to an operating income of $8.8 million in Q3 2024[50] - The company reported a net loss of $80.8 million in Q3 2025, compared to a net loss of $17.6 million in Q3 2024[45] - Total revenues for the nine months ended September 30, 2025 decreased by approximately 9% to $1,418.6 million from $1,555.0 million in the same period of 2024[36] - Operating EBITDA for the nine months ended September 30, 2025 decreased to negative $1.9 million from positive $144.5 million in the same period of 2024[38] Revenue Breakdown - The pulp segment's revenues decreased by approximately 10% to $318.6 million in Q3 2025 from $354.2 million in Q3 2024, driven by lower sales realizations[19] - Solid wood segment revenues in Q3 2025 decreased by approximately 6% to $117.2 million from $125.1 million in Q3 2024, primarily due to lower manufactured products revenues[30] - Lumber revenues increased by approximately 24% to $61.0 million in Q3 2025 from $49.1 million in Q3 2024, driven by higher sales realizations[31] - Manufactured products revenues decreased by approximately 66% to $12.2 million in Q3 2025 from $35.8 million in Q3 2024, impacted by lower sales realizations and volumes[33] Production and Sales Realizations - Average NBSK pulp sales realizations decreased by approximately 11% to $728 per ADMT in Q3 2025 from $814 per ADMT in Q3 2024[20] - Pulp production for NBSK decreased to 366.7 thousand ADMTs in Q3 2025 from 374.4 thousand ADMTs in Q3 2024, a decline of 2.0%[47] - Lumber production in Q3 2025 was 115.4 million fbm, slightly down from 122.5 million fbm in Q3 2024, a decrease of 5.8%[47] - Average sales realizations for manufactured products were $1,615 per cubic meter in Q3 2025, compared to $3,463 per cubic meter in Q3 2024, a significant drop of 53.4%[47] - Average lumber sales realizations rose by approximately 23% to $553 per Mfbm in Q3 2025 from $451 per Mfbm in Q3 2024 due to lower supply and improved demand[31] Cost and Expenses - Per unit fiber costs increased by approximately 14% in Q3 2025 compared to Q3 2024, with expectations for further increases in Q4 2025 due to supply constraints[26] - The company incurred interest expenses of $28,506 thousand in Q3 2025, compared to $26,429 thousand in Q3 2024[59] - Total depreciation and amortization for the nine months ended September 30, 2025, was $117,390 thousand, slightly down from $121,959 thousand in the same period of 2024[54] - Inventory impairment increased to $31,400 thousand for the nine months ended September 30, 2025, compared to $4,000 thousand in the same period of 2024[54] Liquidity and Assets - As of September 30, 2025, the company had cash and cash equivalents of $98.1 million and total liquidity of approximately $376.1 million[40] - Total current assets decreased to $867.8 million as of September 30, 2025, from $910.0 million at the end of 2024[52] - Long-term debt increased to $1.55 billion as of September 30, 2025, compared to $1.47 billion at the end of 2024[52] - Cash and cash equivalents decreased to $98.1 million as of September 30, 2025, down from $184.9 million at the end of 2024[52] - Cash used in operating activities for the nine months ended September 30, 2025, was $(37,569) thousand, compared to a cash inflow of $19,046 thousand for the same period in 2024[54] Future Outlook - The company expects to realize approximately $30 million in cost savings and reliability improvements by the end of 2025 as part of its "One Goal One Hundred" program[5] - The company is advancing a carbon capture and sequestration project at the Peace River mill, expected to enhance long-term economic viability and sustainability[6] - The company will host a conference call on November 7, 2025, to discuss the earnings release and future outlook[41]