NASDAQ$MERC

Mercer International Inc · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

Mercer International Inc. reported a decrease in operating EBITDA and a net loss due to significant annual maintenance activities and weakness in the pulp markets.

Mercer International Inc. reported a decrease in operating EBITDA to negative $34.2 million, compared to $118.1 million in Q4 2018. The net loss for the quarter was $72.7 million, or $1.11 per share, compared to a net income of $45.0 million, or $0.69 per share, in the same quarter of the previous year. The results were impacted by significant annual maintenance activities in the pulp segment and weakness in the pulp markets.

  • Operating EBITDA decreased to negative $34.2 million from positive $118.1 million in Q4 2018.
  • Net loss was $72.7 million, or $1.11 per share, compared to net income of $45.0 million, or $0.69 per share in Q4 2018.
  • Pulp segment annual maintenance downtime of 54 days significantly contributed to negative Operating EBITDA of $34.2 million and a net loss of $72.7 million.
  • Wood segment benefitted from lower fiber costs which largely contributed to it achieving record quarterly operating income of $5.3 million.

Headline financials

Total Revenue

$331M

Previous: $412M-19.7%
EPS (adj)

-$1.04

Previous: $0.68-252.9%
Average NBSK Pulp Prices Europe

$822.00

No prior period
Average NBSK Pulp Prices China

$588.00

No prior period
Average NBSK Pulp Prices North America

$1.12K

No prior period
Average NBHK Pulp Prices China

$475.00

No prior period
Average NBHK Pulp Prices North America

$893.00

No prior period
NBSK Pulp Sales (ADMTs)

416.6K

No prior period
Average NBSK Pulp Sales Realizations

$581.00

No prior period
Lumber Production (MMfbm)

106.7M

No prior period
Avg Lumber Sales Realizations

$347.00

No prior period
Capital Expenditures

$50.6M

Previous: $15.4M+228.1%
Free Cash Flow

$5.9M

Previous: $48.3M-87.8%
Net Income

-$72.7M

Previous: $45M-261.6%
Operating Income

-$66.1M

Previous: $91M-172.6%
Gross Profit

-$46.5M

Previous: $109M-142.9%
Cash & Equivalents

$351M

Previous: $240M+46.0%
Total Assets

$2.07B

Previous: $1.98B+4.6%
Stock-Based Comp

$1M

Previous: $1.02M-1.8%

Revenue & EPS history

Mercer · Revenue · Quarterly

$331M

Q4 2019-19.7%vs Q4 2018
Beat estimate in 6 of 16 quarters(38%)
ActualEstimate

Revenue by segment

Mercer · $468M total across 2 segments · Q3 2023

  • Pulp Segment
    $349M-23.6%
  • Solid Wood Segment
    $120M+61.0%

Forward guidance

Going into 2020, the company expects continued steady demand to improve markets over the year. However, the current ongoing coronavirus outbreak could create inland logistics restrictions or other disruptions that may, over time, begin to slow down paper manufacturing in China and put pressure on pulp pricing and demand.

Tailwinds

  • Continued steady demand is expected to improve markets over the year.
  • Stronger demand in the U.S. is expected to lead to modestly higher lumber prices in the near term.

Headwinds

  • The current ongoing coronavirus outbreak could create inland logistics restrictions or other disruptions.
  • The coronavirus outbreak may slow down paper manufacturing in China.
  • The coronavirus outbreak may put pressure on pulp pricing and demand.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

+0.3%

Avg return

Earnings day

-1.2%

Avg return

5 days after

-1.7%

Avg return

30 days after

44%

28 / 64 earnings

Positive

+24.5%

Q4 2015

Best reaction

-15.5%

Q1 2010

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+3.6%-26.9%-24.3%
Q3 2025-6.9%-6.3%-11.7%
Q1 2025-7.3%-20.0%-15.0%
Q4 2024+16.9%+22.8%-1.1%
Q3 2024-0.2%-2.3%-4.3%
Q2 2024+6.6%+0.8%-12.6%
Q1 2024-2.4%-3.3%-17.2%
Q4 2023+9.1%+7.7%+20.4%
Q3 2023+22.4%+19.3%+23.4%
Q2 2023+7.1%-4.9%+7.1%
Q1 2023-5.1%-3.6%-6.7%
Q4 2022-2.4%-5.6%-17.8%
Q3 2022-4.7%-11.6%-3.4%
Q2 2022+0.0%-5.4%+1.8%
Q1 2022+1.4%+3.5%-5.4%
Q4 2021+1.4%+4.6%+11.0%
Q3 2021+2.2%+0.3%+5.7%
Q2 2021-0.3%+0.9%+0.4%
Q1 2021-3.8%-5.8%-13.4%
Q4 2020-4.8%-2.2%+5.9%
Q3 2020+6.8%+16.5%+39.9%
Q2 2020-6.9%-10.5%+6.0%
Q1 2020-2.9%-13.9%-16.1%
Q4 2019-5.5%-4.5%-30.8%
Q3 2019+3.4%+6.9%+1.9%
Q2 2019-5.4%-10.6%-7.6%
Q1 2019+23.8%+23.8%+2.0%
Q4 2018-2.3%-3.7%-9.4%
Q3 2018-8.0%-13.0%-30.8%
Q2 2018+2.1%+7.2%+5.7%
Q1 2018+1.5%+7.1%+20.6%
Q4 2017+1.5%-2.3%-0.8%
Q3 2017-2.4%+2.8%+0.0%
Q2 2017-7.0%-9.0%-9.0%
Q1 2017-2.0%-5.2%-7.6%
Q4 2016+0.4%+4.2%+2.1%
Q3 2016+1.9%+1.3%+23.2%
Q2 2016-3.2%-2.7%+2.9%
Q1 2016-12.8%
Q4 2015+24.5%
Q3 2015+1.7%
Q2 2015-0.9%
Q1 2015-2.4%
Q4 2014+0.9%
Q3 2014+11.4%
Q2 2014+0.3%
Q1 2014+8.3%
Q4 2013+0.6%
Q3 2013+5.6%
Q2 2013+0.0%
Q1 2013+0.5%
Q4 2012-0.7%
Q3 2012-0.1%
Q2 2012+7.2%
Q1 2011-0.1%
Q1 2012+0.6%
Q4 2009-0.3%
Q4 2011-0.3%
Q3 2011-5.7%
Q3 2010-5.7%
Q2 2010-9.1%
Q2 2011-9.1%
Q4 2010-9.1%
Q1 2010-15.5%

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