Financial Data and Key Metrics Changes - Adjusted EBITDA for Q3 2025 was $18 million, at the high end of the guidance range of $10 million-$20 million, with year-to-date adjusted EBITDA from continuing operations at $87 million, up from $26 million in the same period last year [4][14] - Net sales reached $399 million, a 1% increase year-over-year, driven by a 3% increase in paperboard shipment volumes, partially offset by lower market pricing [13][14] - Net loss from continuing operations was $54 million, or $3.34 per diluted share, primarily due to a $48 million non-cash goodwill impairment [13][14] - The company generated $34 million in cash from operations and approximately $3.5 million in free cash flows during the quarter [15] Business Line Data and Key Metrics Changes - The company successfully completed all three planned major maintenance outages for 2025, with the Lewiston outage costing $24 million and the Augusta outage costing $16 million [4][5] - Fixed cost reduction initiatives are tracking to around $50 million in savings for the year, exceeding the original estimate of $30 million-$40 million [5] Market Data and Key Metrics Changes - The industry is facing margin pressure due to low utilization rates, projected to be in the low 80% range by year-end, significantly below the normalized average of 90%-95% [7] - RISI forecasts a net capacity reduction of approximately 350,000 tons in the first half of 2026, which could drive utilization rates above 90% [8][18] Company Strategy and Development Direction - The company is exploring adding CUK swing capability to one of its SBS machines, with an estimated capital requirement of $50 million and a projected return of over 20% [11][12] - The company aims to maintain its market share and defend its SBS mills while focusing on a strong balance sheet [19] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the long-term fundamentals of the paperboard market, citing strong demand for sustainable packaging solutions [19] - The company expects adjusted EBITDA for Q4 2025 to be between $13 million and $23 million, anticipating slightly lower paperboard shipments due to seasonality [16][18] Other Important Information - The company has ample available liquidity of $455 million and a net leverage ratio of 2.7x, indicating a stable debt level despite the current industry down cycle [15] - The company repurchased $2 million of shares, bringing the total to $20 million against a $100 million authorization [15] Q&A Session Summary Question: Decision to hold the CUK swing capacity project - Management confirmed the decision to hold the project is due to prioritizing a strong balance sheet and market conditions, targeting a leverage ratio in the 1%-2% range [23] Question: Market outlook for SBS and import relief - Management noted that while RISI forecasts a capacity reduction, it is uncertain how the industry will respond, but there are signs of reduced European imports [25] Question: Maintenance schedule for 2026 - Management indicated that costs for maintenance in 2026 would be similar to 2025, with schedules to be finalized and shared in February [27] Question: Incremental strength in shipments and product categories - Management observed strong performance in food service and noted that import relief may be contributing to stronger demand [33] Question: Variability in Q4 guidance - Management highlighted that energy costs and production levels would significantly impact Q4 earnings, with production changes having a substantial effect on earnings [36]