Glatfelter (GLT) Q2 Loss Narrows, Spunlace Leads Segment Gains

Core Viewpoint - Glatfelter Corporation reported a narrower earnings per share loss in Q2 2024 compared to the previous year, despite a decline in net sales, indicating mixed performance across its segments [1][3]. Financial Performance - The company incurred a Q2 2024 EPS loss of 35 cents, an improvement from a loss of 82 cents in the same quarter last year [1]. - Net sales for the quarter were $329.4 million, down 7.7% from $357 million in Q2 2023 [1]. - Adjusted EBITDA increased to $25.6 million, up $17.3 million year-over-year, driven by better performance in Composite Fibers and Spunlace segments [2]. - Gross profit improved to $36.8 million from $18.1 million in Q2 2023, although a net loss of $16.3 million was reported, narrower than the $36.9 million loss in the prior year [3]. Segment Performance - Airlaid Materials: Experienced a 14.4% decline in net sales to $130.6 million, impacted by a 3.7% decrease in shipment volumes and a 13% drop in EBITDA to $15.1 million [4]. - Composite Fibers: Showed a 3.1% increase in shipment volumes and a 102.2% increase in EBITDA to $9.7 million, despite a 6.8% decline in net sales to $117.2 million due to reduced selling prices [5]. - Spunlace: Outperformed with a 4.9% increase in shipments and a 3.5% rise in net sales to $82.2 million, with EBITDA surging 158.4% to $5.6 million [6]. Financial Position - As of June 30, 2024, cash and cash equivalents were $33.9 million, down from $50.3 million at the end of 2023, with total assets declining to $1.5 billion [7]. - Total debt increased slightly to $870.3 million, while shareholders' equity dropped significantly to $205.5 million from $256.9 million [7]. - Leverage stood at 3.5X, with a cash outflow of $20.6 million in the first half of 2024, an improvement from $53 million in the same period of 2023 [8]. Other Developments - Glatfelter reached a $6.5 million settlement related to its former Specialty Papers business, expected to be recognized in Q3 2024 [9]. - The company is progressing with its merger with Berry Global's HHNF business, having obtained all necessary regulatory approvals and awaiting shareholder approval [9][10].