Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $40 million for Q2 2025, which was within the guidance range of $35 million to $45 million [4][21] - Net sales reached $392 million, reflecting a 14% increase year-over-year and a 4% increase compared to Q1 2025, primarily driven by the Augusta acquisition [4][20] - SG&A expenses decreased nearly 14% year-over-year to 6.7% of net sales, aligning with the company's target range of 6% to 7% [6][21] Business Line Data and Key Metrics Changes - The Foodservice business saw increased shipments, contributing to the overall sales growth [5] - The Augusta acquisition positively impacted net sales, marking the last quarter where year-over-year comparisons are affected by the acquisition timing [20] Market Data and Key Metrics Changes - Industry shipments of SBS decreased by 4.6% year-over-year and 3.4% sequentially, indicating mixed demand signals [7] - Industry utilization rates fell to 83.1% in Q2 2025, down from 84.7% in Q1 2025, reflecting new capacity startup by competitors [8] Company Strategy and Development Direction - The company aims to strengthen its position as an independent supplier of paperboard packaging products and is exploring opportunities to expand its product offerings, including entering CUK and CRB markets [14][15] - The company is focused on operational execution, cost reduction, and defending its market position to improve performance and margins [6][29] Management's Comments on Operating Environment and Future Outlook - Management noted that current demand softness is viewed as temporary, with expectations for a recovery in industry utilization rates to 90% to 95% in the medium to long term [12][13] - The company anticipates adjusted EBITDA for Q3 2025 to be in the range of $10 million to $20 million, influenced by maintenance costs and production volume reductions [24] Other Important Information - The company completed a major maintenance outage at its Cypress Bend mill at a cost of approximately $9 million, part of a larger $45 million capital project [5][6] - The company has repurchased approximately $4 million of shares in Q2 2025, totaling $18 million since the new authorization in November [6][23] Q&A Session Summary Question: Demand outlook and changes since the last update - Management indicated mixed demand signals with a 5% increase in shipments versus Q1, but overall industry shipments were down year-over-year [33] Question: Impact of maintenance costs on EBITDA guidance - Management confirmed that the increase in outage expenses and lower production volumes are key factors affecting the Q3 EBITDA guidance [40] Question: Factors influencing capacity utilization and shipments - Management highlighted that the Lewiston outage and demand stability are critical factors, with expectations for flat shipments in Q3 and potential slight increases in Q4 [43]

First Quarter Earnings Release Materials April 29, 2025 ARSEN KITCH President, Chief Executive Officer and Director SHERRI BAKER Senior Vice President and Chief Financial Officer Forward Looking Statements 2024 Was a Transformational Year For Clearwater Paper Completed acquisition of Augusta paperboard mill for $700M on May 1 Increased total SBS capacity to ~1.4M tons Balanced network to deliver lower landed costs and targeting synergies of $40-50M by end of 2026 Completed sale of tissue business for $1.06 ...

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $30 million for Q1 2025, at the high end of guidance, driven by strong operational performance and increased production and sales volumes, primarily due to the Augusta acquisition [6][24] - Net sales increased by 46% to $378 million compared to Q1 2024, largely attributed to the Augusta acquisition [6][24] - The company incurred a consolidated net loss of approximately $6 million from continuing operations, equating to $0.36 per diluted share [23] Business Line Data and Key Metrics Changes - The Augusta mill integration has been successful, with targeted volume and cost synergies expected by the end of 2026 [7] - Fixed cost structure was reduced by eliminating over 200 positions, representing around 10% of total roles, aiming for $30 to $40 million in savings for 2025 [7][18] Market Data and Key Metrics Changes - Industry shipments increased by 2% in Q1 2025 compared to Q1 2024, with demand projected to grow by 3% to 5% in 2025 [8][9] - Industry utilization rates improved to 88% in Q1 2025 from 84% in Q1 2024, but remain below the cross-cycle average of 90% to 95% [10] Company Strategy and Development Direction - The company aims to strengthen its position as a premier independent supplier of paperboard packaging products, investing in product development across three categories: compostable food service products, lightweight folding carton products, and alternative poly-free barrier technologies [13][14][15] - The company is exploring expansion into additional paperboard substrates, which make up approximately 50% of the paperboard market outside of SBS [16] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about medium to long-term industry prospects, expecting strong margins and cash flows through the cycle [34] - The company anticipates continued demand recovery, with internal utilization projected at around 85% and revenue expectations of approximately $1.5 to $1.6 billion for 2025 [29] Other Important Information - The company repurchased approximately $11 million of its shares in Q1 2025, totaling about $15 million since the new $100 million share buyback authorization [7][26] - The company is targeting a reduction in SG&A as a percentage of sales to 6% to 7% by year-end 2025 [25] Q&A Session Summary Question: What is the sense of what's happening with FPB imports recently? - Management noted that imports were up in 2024, with forecasts for a 5% decrease in imports and a 1% increase in exports for 2025 [38][39] Question: Can you clarify the geographic split of the $20 million to $25 million purchases from outside the US and Canada? - Approximately $80 million of imports are from Canada, with the remaining $20 million from other parts of the world, including potential exposure to China [40][41] Question: What are the criteria for evaluating M&A opportunities for expanding product offerings? - The company seeks strategic fit, quality assets, and a belief in the ability to win in the market when considering M&A [46][47] Question: What kind of costs are associated with the paper machine upgrades for lightweight folding carton products? - Upgrades will be on existing machines, with capital fitting within the previously stated capital range, focusing on mix shift rather than incremental revenue growth [48] Question: What is the expected impact of cost savings in Q2? - Management expects to see roughly double the amount of savings in Q2 compared to Q1, with incremental benefits ramping through the year [51]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $30 million for Q1 2025, at the high end of guidance, driven by strong operational performance and increased production and sales volumes, primarily due to the Augusta acquisition [6][24] - Net sales increased by 46% to $378 million compared to Q1 2024, largely attributed to the Augusta acquisition [6][24] - The company incurred a consolidated net loss of approximately $6 million from continuing operations, equating to $0.36 per diluted share [23] Business Line Data and Key Metrics Changes - The Augusta mill integration is progressing well, with targeted volume and cost synergies expected by the end of 2026 [7] - Fixed cost structure was reduced by eliminating over 200 positions, representing around 10% of total roles, aiming for $30 to $40 million in savings for 2025 [7][18] Market Data and Key Metrics Changes - Industry shipments increased by 2% in Q1 2025 compared to Q1 2024, with demand projected to grow by 3% to 5% in 2025 [8][9] - Industry utilization rates improved to 88% in Q1 2025 from 84% in Q1 2024, but remain below the cross-cycle average of 90% to 95% [10] Company Strategy and Development Direction - The company aims to strengthen its position as a premier independent supplier of paperboard packaging products, focusing on product development in compostable food service products, lightweight folding cartons, and alternative poly-free barrier technologies [13][14][15] - The company is exploring expansion into additional paperboard substrates, which make up approximately 50% of the paperboard market outside of SBS [15][17] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about medium to long-term industry prospects, expecting strong margins and cash flows through the cycle [34] - The company anticipates continued demand recovery, with internal utilization projected at around 85% and revenue expectations of approximately $1.5 to $1.6 billion for 2025 [29] Other Important Information - The company repurchased approximately $11 million of its shares in Q1 2025, totaling about $15 million since the new $100 million share buyback authorization [7][26] - The company is targeting a reduction in SG&A as a percentage of sales to 6% to 7% by year-end 2025 [25] Q&A Session Summary Question: What is the current status of FPB imports and exposure to tariffs? - Management noted that imports were up in 2024, with forecasts indicating a 5% decrease in imports and a 1% increase in exports for 2025 [38] Question: What are the criteria for evaluating M&A opportunities for expanding product offerings? - The company emphasized the need for strategic fit, quality assets, and a belief in the ability to win in the market [46] Question: What is the expected impact of cost savings in Q2 and the status of synergies from Augusta? - Management expects to see roughly double the amount of savings in Q2 compared to Q1, with a significant portion of the $40 million to $50 million in synergies from Augusta being volume synergies [50][51]