NYSE$SLVM

Sylvamo Corp. · Q3 2021 earnings

Q3 2021 earnings · · Investor relations

Briefing

Sylvamo released third-quarter results with strong earnings and cash flow.

Sylvamo Corporation reported strong third-quarter earnings and significant cash flow, with an adjusted EBITDA margin of 19.5%. The company is focused on generating strong free cash flow and reducing debt.

  • Third-quarter net income was $92 million ($2.09 per pro forma share).
  • Third-quarter adjusted operating earnings (non-GAAP) were $100 million ($2.27 per pro forma share).
  • Third-quarter adjusted EBITDA (non-GAAP) was $177 million.
  • Price and mix improved by $30 million versus the prior quarter and volume improved by $12 million.

Headline financials

Total Revenue

$908M

Previous: $738M+23.0%
EPS (adj)

$2.27

Previous: $1.16+95.7%
Adjusted EBITDA

$177M

No prior period
Free cash flow

$135M

No prior period
Effective tax rate

24.0%

No prior period
Capital Expenditures

-$54M

No prior period
Net Income

$92M

Previous: $51M+80.4%
Operating Income

-$634M

Previous: $61M-1139.3%
Gross Profit

-$587M

Previous: $238M-346.6%
Cash & Equivalents

$132M

No prior period
Total Assets

$2.74B

No prior period
Stock-Based Comp

$3M

No prior period

Revenue & EPS history

Sylvamo · Revenue · Quarterly

$908M

Q3 2021+23%vs Q3 2020
Beat estimate in 5 of 9 quarters(56%)
ActualEstimate

Revenue by segment

Sylvamo · $909M total across 3 segments · Q3 2021

  • North America
    $447M+19.2%
  • Europe
    $262M+19.1%
  • Latin America
    $200M+33.3%

Forward guidance

Sylvamo projects fourth-quarter adjusted EBITDA in the range of $140 to $150 million and adjusted operating earnings per share of $1.20 to $1.40.

Tailwinds

  • Price and mix are expected to improve by $30 to $35 million compared to the third quarter, reflecting continued realization of prior price increases.
  • Volume is expected to improve by $10 to $15 million, reflecting continued strong demand in Europe and North America and seasonally stronger demand in Latin America.
  • Operations are expected to increase by $15 million, reflecting seasonally higher costs in Europe and North America.

Headwinds

  • Input costs and distribution are projected to increase by $35 to $40 million as prices for wood, energy, chemicals and other key inputs continue to increase.
  • Total maintenance outage expenses are projected to increase by $24 million, primarily the impact of a 10-year cold mill outage at our Saillat mill and an extended cold mill outage at our Eastover mill.
  • We also project $8 million in costs related to transition service agreements in the quarter and $4 million of one-time costs

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 Q3 2021

Historical avgQ3 2021

+1.2%

Avg return

Earnings day

+2.5%

Avg return

5 days after

+2.1%

Avg return

30 days after

59%

13 / 22 earnings

Positive

+23.3%

Q4 2023

Best reaction

-17.0%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-3.2%-12.5%-12.3%
Q4 2025+5.1%-9.5%-20.3%
Q3 2025+0.1%+8.7%+13.1%
Q1 2025-12.6%-6.1%-10.6%
Q4 2024-7.3%-5.2%-14.1%
Q3 2024-14.7%-11.4%-6.5%
Q2 2024+11.3%+13.0%+10.3%
Q1 2024+2.7%+6.1%+6.0%
Q4 2023+23.3%+20.8%+24.7%
Q3 2023+7.4%+10.5%+18.4%
Q2 2023-17.0%-16.4%-15.6%
Q1 2023-7.9%-7.3%-5.2%
Q4 2022-1.3%-1.1%+2.9%
Q3 2022+8.4%+13.7%+32.3%
Q2 2022+3.0%+4.9%-8.0%
Q1 2021+6.7%+8.7%+4.1%
Q1 2022+14.4%+20.7%+19.4%
Q2 2021-5.0%-8.8%+1.5%
Q4 2019-5.0%-8.8%+1.5%
Q4 2021+7.1%+13.6%-2.9%
Q4 2020+6.5%+10.1%+1.3%
Q3 2021+4.2%+11.0%+5.6%
Q3 2020
Q2 2020
Q1 2020

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