KP Tissue Releases Second Quarter 2025 Financial Results

Core Insights - KP Tissue Inc. (KPT) reported strong profitability in Q2 2025, with Adjusted EBITDA increasing by 11% year-over-year to $72.5 million, driven by higher sales volumes and favorable selling prices [3][9] - The company announced a $35 million investment in its Memphis manufacturing facility to enhance efficiency and support its growing U.S. business [4][14] - U.S. sales grew by 12% in the first half of 2025, although growth slowed in Q2 due to front-loaded shipments and softness in the Away-From-Home (AFH) market [3][6] Financial Performance - Revenue for Q2 2025 was $536.1 million, up from $509.8 million in Q2 2024, marking a 5.2% increase [6][10] - Cost of sales rose to $462.2 million in Q2 2025, an increase of 7.2% from $431.2 million in Q2 2024, primarily due to higher sales volume and pulp prices [7] - Selling, general and administrative (SG&A) expenses increased by 11.1% to $47.2 million in Q2 2025, compared to $42.5 million in Q2 2024 [8] Profitability Metrics - Adjusted EBITDA for Q2 2025 was $72.5 million, up from $65.3 million in Q2 2024, reflecting an 11% increase [9][10] - Net income for Q2 2025 was $22.1 million, compared to $10.6 million in Q2 2024, representing an increase of $11.5 million [11][10] - The company declared a quarterly dividend of $0.18 per share, to be paid on October 15, 2025 [15][10] Investment and Growth Strategy - The investment in the Memphis facility aims to deploy a state-of-the-art converting line for bathroom tissue and paper towels, enhancing production capabilities [4][14] - The company expects stronger performance in Q3 2025, projecting Adjusted EBITDA in the range of $75 million to $80 million [5] Liquidity Position - As of June 30, 2025, total liquidity was reported at $293.1 million, indicating a solid financial position [12]