• |
Net sales of $328 million, a 4% increase over fourth quarter 2020 and a 3% decrease over third quarter 2021
|
• |
Net income of $13 million compared to a net loss of $90 million in the fourth quarter of 2020 and net income of $58 million in the third quarter 2021
|
• |
Adjusted EBITDA of $74 million compared to $9 million in the fourth quarter of 2020 and $67 million in the third quarter of 2021
|
Three Months Ended
December 31, |
Three Month
$ Change | |||||||||||
(Dollars in millions)
|
2020
|
2021
| ||||||||||
Net sales |
$
|
314
| $ | 328 | $ | 14 | ||||||
Costs and expenses: | ||||||||||||
Costs of products sold (exclusive of depreciation and amortization) |
327 |
252
| (75 | ) | ||||||||
Depreciation and amortization |
87
|
17
| (70 | ) | ||||||||
Selling, general and administrative expenses |
15
|
22
|
7 | |||||||||
Restructuring charges |
8
|
6
| (2 | ) | ||||||||
Other operating (income) expense |
(5
|
)
|
(3
|
)
|
2 | |||||||
Operating income (loss) |
(118
|
)
|
34
|
152 | ||||||||
Interest expense |
-
|
1
|
1 | |||||||||
Other (income) expense |
(5
|
)
|
(6
|
)
| (1 | ) | ||||||
Income (loss) before income taxes |
(113
|
)
|
39
|
152
| ||||||||
Income tax expense (benefit) |
(23
|
)
|
26
|
49
| ||||||||
New income (loss) |
$
|
(90
|
)
|
$
|
13
|
$
|
103
|
• |
Favorable price/mix of $57 million driven by price increase realization across all grades, including pulp
|
• |
Improved operating income of $12 million resulting from the conversion to our current two mill system
|
• |
Lower net operating expenses of $42 million driven by $25 million of lower closed/idled mill spend and $17 million of additional reductions associated with lower wood cost and cost reduction initiatives across our mill system
|
• |
Lower depreciation expense of $70 million, primarily due to $65 million in accelerated depreciation related to the closure of our Duluth Mill in December 2020
|
• |
Lower Restructuring charges of $2 million associated with the permanent shutdown of our Duluth Mill in December 2020
|
• |
Lower sales volume resulting in a decrease of $2 million in net operating income
|
• |
Inflationary costs of $20 million driven by purchased pulp, latex, energy and freight
|
• |
Higher Selling, general and administrative costs of $7 million primarily driven by costs associated with the Merger Agreement, as well as higher incentive expense, partially offset by lower severance costs
|
• |
Lower other operating income of $2 million, primarily related to finalization of the working capital adjustment to the sale of our Androscoggin and Stevens Point mills in 2020
|
Twelve Months Ended
December 31, |
Twelve Month
$ Change | |||||||||||
(Dollars in millions)
|
2020
|
2021
| ||||||||||
Net sales |
$
|
1,359 | $ |
1,278 | $ |
(81 |
) | |||||
Costs and expenses: | ||||||||||||
Costs of products sold (exclusive of depreciation and amortization) |
1,334 |
1,062 | (272 | ) | ||||||||
Depreciation and amortization |
153 |
154 |
1 | |||||||||
Selling, general and administrative expenses |
77 |
76 |
(1 |
) | ||||||||
Restructuring charges |
12 |
23 |
11 | |||||||||
Other operating (income) expense |
(89
|
)
|
(8
|
)
|
81 | |||||||
Operating income (loss) |
(128
|
)
|
(29 |
) |
99 | |||||||
Interest expense |
1 |
2 |
1 | |||||||||
Other (income) expense |
(19
|
)
|
(25
|
)
| (6 | ) | ||||||
Income (loss) before income taxes |
(110
|
)
|
(6 |
) |
104 | |||||||
Income tax expense (benefit) |
(9
|
)
|
(3 |
) |
6 | |||||||
New income (loss) |
$
|
(101
|
)
|
$
|
(3
|
) |
$
|
98 |
• |
Favorable price/mix of $129 million driven by price increase realization across all grades, including pulp
|
• |
Improved operating income of $34 million resulting from the conversion to our current two mill system
|
• |
Lower net operating expenses of $78 million primarily driven by lower closed/idled mill spend, as well as lower wood cost, improved performance and cost reduction initiatives across our mill system
|
• |
Lower planned major maintenance costs of $7 million driven by reduced scope
|
• |
Lower Selling, general and administrative expenses of $1 million driven primarily by cost savings in connection with the sale of the two specialty mills in 2020, offset by higher incentive expense and Merger Agreement costs in 2021
|
• |
Lower sales volume resulting in a decrease of $6 million in net operating income
|
• |
Inflationary costs of $51 million driven by purchased pulp, latex, energy and freight
|
• |
Higher depreciation expense of $1 million due primarily to $84 million in accelerated depreciation at our Wisconsin Rapids Mill in 2021, partially offset by $65 million in accelerated depreciation associated with the closure of our Duluth Mill in December 2020 and approximately $16 million of nonrecurring depreciation associated with these events
|
• |
Higher Restructuring charges of $11 million primarily associated with the permanent shutdown of our Duluth Mill in December 2020 and the No. 14 paper machine and certain other long-lived assets at our Wisconsin Rapids Mill in February 2021
|
• |
Lower other operating income of $81 million, primarily as a result of the $94 million gain on the sale of our Androscoggin and Stevens Point mills in 2020, partially offset by $6 million in insurance recoveries in 2021, associated with a 2019 insurance claim at our Quinnesec Mill
|
Three Months Ended September 30, |
Three Months Ended
December 31,
|
Twelve Months Ended
December 31,
| ||||||||||||||||||
(Dollars in millions)
|
2021
|
2020 |
2021 |
2020 |
2021 | |||||||||||||||
Net income (loss) |
$
|
58
|
$
|
(90
|
) |
$
|
13
|
$
|
(101
|
)
|
$
|
(3
|
)
| |||||||
Income tax expense (benefit) |
(17
|
)
|
(23
|
)
|
26
|
(9 |
) |
(3
|
)
| |||||||||||
Interest expense |
-
|
-
|
1
|
1
|
2
| |||||||||||||||
Depreciation and amortization |
18
|
87
|
17
|
153
|
154
| |||||||||||||||
EBITDA
|
$
|
59
|
$
|
(26
|
) |
$
|
57
|
$
|
44 |
$
|
150
| |||||||||
Adjustments to EBITDA: | ||||||||||||||||||||
Restructuring charges(1) |
-
|
8
|
6
|
12 |
23
| |||||||||||||||
Luke Mill post-closure costs(2) |
(1
|
)
|
6
|
2
|
15 |
9
| ||||||||||||||
Noncash equity award compensation(3) |
1
|
-
|
2
|
5 |
5
| |||||||||||||||
Gain on Sale of the Androscoggin/Stevens Point Mills(4) |
-
|
(6
|
)
|
-
|
(94 |
) |
-
| |||||||||||||
Loss on Sale of Duluth Mill(5) |
-
|
-
|
-
|
-
|
3
| |||||||||||||||
Duluth and Wisconsin Rapids mills idle/post-closure costs(6) |
3
|
20
|
3
|
37
|
20
| |||||||||||||||
(Gain) loss on sale or disposal of assets(7) |
-
|
1
|
(1
|
)
|
4 |
(1
|
)
| |||||||||||||
Stockholders proxy solicitation costs(8) |
-
|
-
|
-
|
4 |
-
| |||||||||||||||
Other severance costs(9) |
2
|
5
|
-
|
18 |
4
| |||||||||||||||
Merger related costs(10) |
-
|
-
|
5
|
- |
6
| |||||||||||||||
Other items, net(11) |
3
|
1
|
-
|
2 |
4
| |||||||||||||||
Adjusted EBITDA |
$
|
67
|
$
|
9
|
$
|
74
|
$
|
47
|
$
|
223
|
(1)
|
For 2020, charges are associated with the closure of our Luke Mill in June 2019 and the closure of our Duluth Mill in December 2020. For 2021, charges are associated with the closure of our Luke Mill, the closure of our Duluth Mill and of the No. 14 paper machine and certain other long-lived assets at our Wisconsin Rapids Mill in February 2021.
|
(2)
|
Costs recorded after the permanent shutdown of our Luke Mill that are not associated with product sales or restructuring activities, including costs relating to the ongoing environmental remediation and monitoring efforts.
|
(3)
|
Amortization of noncash incentive compensation.
|
(4)
|
Gain on the sale of outstanding membership interests in Verso Androscoggin, LLC in February 2020, which included our Androscoggin Mill and Stevens Point Mill.
|
(5)
|
Loss on the sale of our Duluth Mill in May 2021.
|
(6)
|
Idle/post-closure costs associated with our Duluth and Wisconsin Rapids mills that are not associated with product sales or restructuring activity.
|
(7)
|
Realized (gain) loss on the sale or disposal of assets.
|
(8)
|
Costs incurred in connection with the stockholders proxy solicitation contest.
|
(9)
|
Severance and related benefit costs not associated with restructuring activities.
|
(10)
|
Professional fees and other charges associated with merger related activity, including the Merger Agreement entered on December 19, 2021 with BillerudKorsnäs.
|
(11)
|
For 2020, other miscellaneous adjustments. For 2021, professional fees and other charges associated with strategic matters and other miscellaneous adjustments.
|
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Verso Corporation published this content on 28 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 February 2022 11:54:09 UTC.