Kruger Products Q4 2023 Business and Financial Highlights
- Revenue was
$482.3 million in Q4 2023 compared to$458.1 million in Q4 2022, an increase of$24.2 million or 5.3%. - Adjusted EBITDA1 was
$61.2 million in Q4 2023, compared to$44.4 million in Q4 2022, an increase of 37.9%. - Net income was
$16.5 million in Q4 2023 compared to$16.0 million in Q4 2022, an increase of$0.5 million . - Declared a quarterly dividend of
$0.18 per share to be paid onApril 15, 2024 . - Facial tissue line in the
Sherbrooke Expansion Project started up successfully inFebruary 2024 . - Announced a 25% increase in facial production at the
Gatineau plant onMarch 5, 2024 with a$14.5 million investment.
Kruger Products Full Year 2023 Financial Highlights
- Revenue was
$1,873.0 million in Fiscal 2023 compared to$1,681.4 million in Fiscal 2022, an increase of$191.6 million or 11.4%. - Adjusted EBITDA1 was
$238.6 million in Fiscal 2023, compared to$116.0 million in Fiscal 2022, an increase of 105.7%. - Net loss was
$5.3 million in Fiscal 2023 compared to$56.9 million in Fiscal 2022, a decrease in the loss of$51.6 million .
“We are pleased with our financial results in fiscal 2023, highlighted by record sales of
“In our Consumer segment, we gained market share within the facial tissue and paper towel categories, while improving our share trend on bathroom tissue. We also stepped up to support and supply our Scotties facial tissue to customers and consumers given the exit of Kleenex from the Canadian grocery market. Our Away-From-Home business continued to deliver sustainable results with another strong Adjusted EBITDA quarter and year.”
“In the fourth quarter, our underlying results remained solid with Adjusted EBITDA growing 37.9% year-over-year to
Outlook for Q1 2024
For the first quarter of 2024, we expect margins to remain consistent and Adjusted EBITDA1 to be in a similar range to Q4 2023.
Kruger Products Q4 2023 Financial Results
Revenue was
Cost of sales was
Selling, general and administrative (SG&A) expenses were
Adjusted EBITDA1 was
Net income was
Kruger Products 2023 Financial Results
Revenue was
Adjusted EBITDA1 was
Net loss was
Kruger Products Q4 2023 Liquidity
Total liquidity, representing cash and availability under the revolving credit agreements, was
KPT Q4 2023 Financial Results
KPT had net income of
KPT 2023 Financial Results
KPT had a net loss of
Dividends on Common Shares
The Board of Directors of KPT declared a quarterly dividend of
Additional Information
For additional information please refer to Management’s Discussion and Analysis (MD&A) of KPT and Kruger Products for the fourth quarter and fiscal year ended
Fourth Quarter Results Conference Call Information
KPT will hold its fourth quarter conference call on
Via telephone: 1-888-664-6383 or 416-764-8650
Via the internet at: www.kptissueinc.com
Presentation material referenced during the conference call will be available at www.kptissueinc.com.
A rebroadcast of the conference call will be available until midnight,
The replay of the webcast will remain available on the website until midnight,
About
KPT was created to acquire, and its business is limited to holding, a limited equity interest in Kruger Products, which is accounted for as an investment on the equity basis. KPT currently holds a 12.9% interest in Kruger Products. For more information visit www.kptissueinc.com.
About Kruger Products
Kruger Products is
Non-GAAP Financial Measures
This press release uses certain non-GAAP financial measures which Kruger Products believes provide useful information to management of Kruger Products and the readers of the financial information in measuring the financial performance and financial condition of Kruger Products. These measures do not have a standardized meaning prescribed by GAAP and therefore may not be comparable to similarly titled measures presented by other companies. An example of such a measure is Adjusted EBITDA. Adjusted EBITDA is not a measurement of operating performance computed in accordance with GAAP and should not be considered as a substitute for operating income, net income or cash flows from operating activities computed in accordance with GAAP. “Adjusted EBITDA” is calculated by Kruger Products as net income (loss) before (i) interest expense and other finance costs, (ii) income taxes, (iii) depreciation, (iv) amortization, (v) loss (gain) on disposal of property, plant and equipment, (vi) foreign exchange loss (gain), (vii) costs related to restructuring activities, (viii) changes in amortized cost of Partnership units liability, (ix) consulting costs related to operational transformation initiatives and (x) corporate development related costs. A reconciliation of Adjusted EBITDA to the relevant reported results can be found in the Segment and Geographic Results table of this news release.
Forward-Looking Statements
Certain statements in this press release about KPT’s and Kruger Products' current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-looking statements. The words "may", "will", "would", "should", "could", "expects", "plans", "intends", "trends", "indications", "anticipates", "believes", "estimates", "predicts", "likely" or "potential" or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking statements. The forward-looking statements are based on certain key expectations and assumptions made by KPT or Kruger Products, including the moderation of inflationary pressure on input costs and continued inflationary pressure on SG&A as labour, marketing and IT costs continue to rise. Although KPT and Kruger Products believe that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking statements since no assurance can be given that such expectations and assumptions will prove to be correct.
The outlook provided in respect of Adjusted EBITDA1 for Q1 2024 is forward-looking information and is based on the assumptions and subject to the risk and uncertainties referred to below. The purpose of the outlook is to provide the reader with an indication of management’s expectations, at the date of this press release, regarding Kruger Products’ future financial performance. Readers are cautioned that this information may not be appropriate for other purposes.
Many factors could cause Kruger Products’ actual results, level of activity, performance or achievements or future events or developments (which could in turn affect the economic benefits derived from KPT’s economic interest in Kruger Products), to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors, which are discussed in greater detail in the “Risk Factors – Risks Related to Kruger Products’ Business” section of the KPT Annual Information Form dated
Readers should not place undue reliance on forward-looking statements made herein. The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. The forward-looking information contained herein is made as of the date of press release and KPT undertakes no obligation to publicly update such forward-looking information to reflect new information, subsequent or otherwise, unless required by applicable securities laws.
INFORMATION:
General Counsel and Corporate Secretary
Tel.: 905.812.6936
francois.paroyan@krugerproducts.ca
INVESTORS:
Director of Investor Relations
Tel.: 905.812.6962
IR@KPTissueinc.com
1 Adjusted EBITDA is a non-GAAP financial measure. Refer to the Non-GAAP Financial Measures section of this news release for more information on these measures
Consolidated Statements of Financial Position | ||||||
(thousands of Canadian dollars) | ||||||
$ | $ | |||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | 135,728 | 71,261 | ||||
Restricted cash | 12,451 | 7,145 | ||||
Trade and other receivables | 130,157 | 119,681 | ||||
Receivables from related parties | 842 | 223 | ||||
Inventories | 254,372 | 286,566 | ||||
Income tax recoverable | 4,578 | 1,306 | ||||
Prepaid expenses | 4,726 | 5,640 | ||||
542,854 | 491,822 | |||||
Non-current assets | ||||||
Property, plant and equipment | 1,421,650 | 1,294,838 | ||||
Right-of-use assets | 84,866 | 81,715 | ||||
Other long-term assets | 3,808 | 27,554 | ||||
Pensions | 69,839 | 83,080 | ||||
152,021 | 152,021 | |||||
Intangible assets | 26,852 | 30,027 | ||||
Deferred income taxes | 23,740 | 95,711 | ||||
Total assets | 2,325,630 | 2,256,768 | ||||
Liabilities | ||||||
Current liabilities | ||||||
Trade and other payables | 400,385 | 279,425 | ||||
Payables to related parties | 10,973 | 11,363 | ||||
Dividends payable | 13,675 | - | ||||
Distributions payable | - | 12,866 | ||||
Current portion of long-term debt | 35,229 | 34,411 | ||||
Current portion of lease liabilities | 27,154 | 28,349 | ||||
Current portion of long-term payable to related party | 5,800 | 5,800 | ||||
Current portion of provisions | 3,952 | 3,252 | ||||
497,168 | 375,466 | |||||
Non-current liabilities | ||||||
Long-term debt | 1,034,016 | 1,077,297 | ||||
Long-term lease liabilities | 71,865 | 70,579 | ||||
Long-term payable to related party | 35,580 | 39,042 | ||||
Long-term provisions | 5,740 | 3,076 | ||||
Pensions | 18,935 | 20,847 | ||||
Post-retirement benefits | 48,699 | 43,739 | ||||
Liabilities to non-equityholders | 1,712,003 | 1,630,046 | ||||
Long-term portion of Partnership units liability | - | 133,551 | ||||
Total liabilities | 1,712,003 | 1,763,597 | ||||
Equity | ||||||
Share capital | 278,252 | - | ||||
Partnership units | - | 494,459 | ||||
Contributed surplus | 395,382 | - | ||||
Deficit | (164,029 | ) | (87,835 | ) | ||
Accumulated other comprehensive income | 81,011 | 86,547 | ||||
Equity attributable to Kruger Products | 590,616 | 493,171 | ||||
Non-controlling interest | 23,011 | - | ||||
Total equity | 613,627 | 493,171 | ||||
Total equity and liabilities | 2,325,630 | 2,256,768 | ||||
Consolidated Statements of Income (Loss) | |||||||||||
(thousands of Canadian dollars) | |||||||||||
3-month period ended | 3-month period ended | 12-month period ended | 12-month period ended | ||||||||
$ | $ | $ | $ | ||||||||
Revenue | 482,269 | 458,139 | 1,872,962 | 1,681,403 | |||||||
Expenses | |||||||||||
Cost of sales | 400,476 | 416,378 | 1,571,587 | 1,547,318 | |||||||
Selling, general and administrative expenses | 50,319 | 30,612 | 167,209 | 124,648 | |||||||
Restructuring costs, net | 274 | 3,543 | 1,574 | 4,550 | |||||||
Operating income | 31,200 | 7,606 | 132,592 | 4,887 | |||||||
Interest expense and other finance costs | 18,515 | 20,658 | 70,255 | 74,468 | |||||||
Other expense (income) | (8,482 | ) | (30,956 | ) | (9,352 | ) | 3,373 | ||||
Income (loss) before income taxes | 21,167 | 17,904 | 71,689 | (72,954 | ) | ||||||
Current tax expense (recovery) | 689 | (97 | ) | 2,632 | 1,288 | ||||||
Deferred tax expense (recovery) | 1,916 | 2,005 | 70,776 | (17,360 | ) | ||||||
Income tax expense (recovery) | 2,605 | 1,908 | 73,408 | (16,072 | ) | ||||||
Net income (loss) including non-controlling interest | 18,562 | 15,996 | (1,719 | ) | (56,882 | ) | |||||
Net income attributable to non-controlling interest | 2,026 | - | 3,594 | - | |||||||
Net income (loss) attributable to Kruger Products | 16,536 | 15,996 | (5,313 | ) | (56,882 | ) | |||||
Consolidated Statements of Cash Flows | |||||||||||
(thousands of Canadian dollars) | |||||||||||
3-month period ended | 3-month period ended | 12-month period ended | 12-month period ended | ||||||||
$ | $ | $ | $ | ||||||||
Cash flows from (used in) operating activities | |||||||||||
Net income (loss) including non-controlling interest | 18,562 | 15,996 | (1,719 | ) | (56,882 | ) | |||||
Items not affecting cash | |||||||||||
Depreciation | 26,691 | 32,008 | 96,996 | 98,452 | |||||||
Amortization | 1,106 | 1,142 | 4,377 | 4,419 | |||||||
Loss on sale of property, plant and equipment | 1,945 | 103 | 3,043 | 121 | |||||||
Gain on disposal of leased assets | - | - | (488 | ) | - | ||||||
Change in amortized cost of Partnership unit liability | - | (25,586 | ) | - | (25,586 | ) | |||||
Foreign exchange loss (gain) | (8,482 | ) | (5,418 | ) | (9,352 | ) | 28,911 | ||||
Interest expense and other finance costs | 18,515 | 20,658 | 70,255 | 74,468 | |||||||
Pension and post-retirement benefits | 2,200 | 3,656 | 8,656 | 14,632 | |||||||
Provisions | 998 | 1,373 | 3,702 | 2,640 | |||||||
Income tax expense (recovery) | 2,605 | 1,908 | 73,408 | (16,072 | ) | ||||||
Loss on sale of non-financial assets | 3 | 1 | 24 | 12 | |||||||
Total items not affecting cash | 45,581 | 29,845 | 250,621 | 181,997 | |||||||
Net change in non-cash working capital | 45,895 | 20,004 | 110,162 | (65,241 | ) | ||||||
Contributions to pension and post-retirement benefit plans | (1,098 | ) | (2,638 | ) | (8,537 | ) | (15,192 | ) | |||
Provisions paid | (862 | ) | (150 | ) | (4,305 | ) | (4,153 | ) | |||
Income tax payments, net | 174 | (49 | ) | (1,834 | ) | (1,806 | ) | ||||
Net cash from operating activities | 108,252 | 63,008 | 344,388 | 38,723 | |||||||
Cash flows from (used in) investing activities | |||||||||||
Purchases of property, plant and equipment | (19,980 | ) | (10,349 | ) | (34,653 | ) | (37,660 | ) | |||
Purchases of property, plant and equipment and software related to the | (855 | ) | (5,517 | ) | (2,435 | ) | (20,702 | ) | |||
Purchases of property, plant and equipment related to the | (57,943 | ) | (23,174 | ) | (147,938 | ) | (53,118 | ) | |||
Interest paid on credit facilities related to the | (133 | ) | 51 | (454 | ) | (238 | ) | ||||
Government assistance received | - | - | 1,250 | 1,023 | |||||||
Purchases of software | (646 | ) | (7 | ) | (1,202 | ) | (4,946 | ) | |||
Proceeds on sale of property, plant and equipment | 121 | - | 2,586 | 1 | |||||||
Net cash used in investing activities | (79,436 | ) | (38,996 | ) | (182,846 | ) | (115,640 | ) | |||
Cash flows from (used in) financing activities | |||||||||||
Proceeds from long-term debt, net | 43,411 | (4,071 | ) | 130,954 | 244,255 | ||||||
Repayment of long-term debt | (57,874 | ) | (5,801 | ) | (127,780 | ) | (141,519 | ) | |||
Payment of deferred financing fees | (494 | ) | (218 | ) | (899 | ) | (3,036 | ) | |||
Payment of lease liabilities | (9,984 | ) | (6,850 | ) | (30,819 | ) | (28,113 | ) | |||
Change in Restricted cash | (1,369 | ) | (1,167 | ) | (5,306 | ) | (4,639 | ) | |||
Interest paid on long-term debt | (15,109 | ) | (15,750 | ) | (49,390 | ) | (51,948 | ) | |||
Payment to related party | - | - | (5,700 | ) | - | ||||||
Dividends paid, net | (1,743 | ) | - | (6,988 | ) | - | |||||
Distributions paid, net | - | (1,731 | ) | - | (17,495 | ) | |||||
Net cash used in financing activities | (43,162 | ) | (35,588 | ) | (95,928 | ) | (2,495 | ) | |||
Effect of exchange rate changes on cash and cash equivalents held in foreign currency | (1,071 | ) | 714 | (1,147 | ) | 2,154 | |||||
Increase (decrease) in cash and cash equivalents during the period | (15,417 | ) | (10,862 | ) | 64,467 | (77,258 | ) | ||||
Cash and cash equivalents - Beginning of period | 151,145 | 82,123 | 71,261 | 148,519 | |||||||
Cash and cash equivalents - End of period | 135,728 | 71,261 | 135,728 | 71,261 | |||||||
Segment and Geographic Results | |||||||||||
(thousands of Canadian dollars) | |||||||||||
3-month period ended | 3-month period ended | 12-month period ended | 12-month period ended | ||||||||
$ | $ | $ | $ | ||||||||
Segment Information | |||||||||||
Segment Revenue | |||||||||||
Consumer | 400,867 | 378,814 | 1,551,157 | 1,394,052 | |||||||
AFH | 81,402 | 79,325 | 321,805 | 287,351 | |||||||
Revenue from external customers | 482,269 | 458,139 | 1,872,962 | 1,681,403 | |||||||
Adjusted EBITDA | |||||||||||
Consumer | 59,842 | 42,709 | 230,310 | 117,428 | |||||||
AFH | 5,714 | 5,690 | 20,792 | 7,375 | |||||||
Corporate and other costs | (4,337 | ) | (3,993 | ) | (12,496 | ) | (8,812 | ) | |||
Total Adjusted EBITDA | 61,219 | 44,406 | 238,606 | 115,991 | |||||||
Reconciliation to net income (loss): | |||||||||||
Depreciation and amortization | 27,797 | 33,150 | 101,373 | 102,871 | |||||||
Interest expense and other finance costs | 18,515 | 20,658 | 70,255 | 74,468 | |||||||
Change in amortized cost of Partnership unit liability | - | (25,586 | ) | - | (25,586 | ) | |||||
Loss on sale of property, plant and equipment | 1,945 | 103 | 3,043 | 121 | |||||||
Loss on sale of non-financial assets | 3 | 1 | 24 | 12 | |||||||
Other expense | - | 48 | - | 48 | |||||||
Restructuring costs, net | 274 | 3,543 | 1,574 | 4,550 | |||||||
Foreign exchange loss (gain) | (8,482 | ) | (5,418 | ) | (9,352 | ) | 28,911 | ||||
Consulting costs related to operational transformation initiatives | - | 3 | - | 3,550 | |||||||
Income (loss) before income taxes | 21,167 | 17,904 | 71,689 | (72,954 | ) | ||||||
Income tax expense (recovery) | 2,605 | 1,908 | 73,408 | (16,072 | ) | ||||||
Net income (loss) including non-controlling interest | 18,562 | 15,996 | (1,719 | ) | (56,882 | ) | |||||
Geographic Revenue | |||||||||||
274,843 | 262,335 | 1,068,376 | 994,368 | ||||||||
US | 207,426 | 195,804 | 804,586 | 687,035 | |||||||
Total revenue | 482,269 | 458,139 | 1,872,962 | 1,681,403 | |||||||
Statements of Financial Position | |||||
(thousands of Canadian dollars) | |||||
$ | $ | ||||
Assets | |||||
Current assets | |||||
Dividends receivable | 1,793 | - | |||
Distributions receivable | - | 1,790 | |||
Income tax recoverable | 652 | 580 | |||
2,445 | 2,370 | ||||
Non-current assets | |||||
Investment in associate | 68,162 | 79,338 | |||
Total assets | 70,607 | 81,708 | |||
Liabilities | |||||
Current liabilities | |||||
Dividend payable | 1,793 | 1,790 | |||
Payable to investee | 457 | 170 | |||
2,250 | 1,960 | ||||
Non-current liabilities | |||||
Deferred income taxes | - | 5,718 | |||
Total liabilities | 2,250 | 7,678 | |||
Equity | |||||
Common shares | 22,560 | 22,379 | |||
Contributed surplus | 144,819 | 144,819 | |||
Deficit | (115,027 | ) | (108,008 | ) | |
Accumulated other comprehensive income | 16,005 | 14,840 | |||
Total equity | 68,357 | 74,030 | |||
Total liabilities and equity | 70,607 | 81,708 | |||
Statements of Income (Loss) | |||||||||||
(thousands of Canadian dollars, except share and per share amounts) | |||||||||||
3-month period ended | 3-month period ended | 12-month period ended | 12-month period ended | ||||||||
$ | $ | $ | $ | ||||||||
Share of income (loss) | 2,212 | 2,339 | (697 | ) | (8,086 | ) | |||||
Depreciation of fair value increments | (279 | ) | (1,271 | ) | (1,165 | ) | (5,213 | ) | |||
Equity income (loss) | 1,933 | 1,068 | (1,862 | ) | (13,299 | ) | |||||
Dilution gain | 245 | 269 | 1,032 | 752 | |||||||
Income (loss) before income taxes | 2,178 | 1,337 | (830 | ) | (12,547 | ) | |||||
Current tax expense (recovery) | 215 | 38 | 215 | (410 | ) | ||||||
Deferred tax expense (recovery) | - | 2,289 | 3,892 | (1,888 | ) | ||||||
Income tax expense (recovery) | 215 | 2,327 | 4,107 | (2,298 | ) | ||||||
Net income (loss) | 1,963 | (990 | ) | (4,937 | ) | (10,249 | ) | ||||
Basic earnings (loss) per share | 0.20 | (0.10 | ) | (0.50 | ) | (1.03 | ) | ||||
Weighted average number of shares outstanding | 9,962,907 | 9,944,972 | 9,955,981 | 9,936,187 | |||||||
Statements of Cash Flows | |||||||||||
(thousands of Canadian dollars) | |||||||||||
3-month period ended | 3-month period ended | 12-month period ended | 12-month period ended | ||||||||
$ | $ | $ | $ | ||||||||
Cash flows from (used in) operating activities | |||||||||||
Net income (loss) | 1,963 | (990 | ) | (4,937 | ) | (10,249 | ) | ||||
Items not affecting cash | |||||||||||
Equity loss (income) | (1,933 | ) | (1,068 | ) | 1,862 | 13,299 | |||||
Dilution gain | (245 | ) | (269 | ) | (1,032 | ) | (752 | ) | |||
Income tax expense (recovery) | 215 | 2,327 | 4,107 | (2,298 | ) | ||||||
Total items not affecting cash | (1,963 | ) | 990 | 4,937 | 10,249 | ||||||
Net change in non-cash working capital | 424 | - | 287 | (76 | ) | ||||||
Tax refunds (payments), net | (424 | ) | - | (287 | ) | 38 | |||||
Tax Distribution received, net | - | - | - | 38 | |||||||
Net cash from (used in) operating activities | - | - | - | - | |||||||
Cash flows from investing activities | |||||||||||
Dividends received, net | 1,742 | - | 6,984 | - | |||||||
Partnership unit distributions received, net | - | 1,731 | - | 6,617 | |||||||
Net cash from investing activities | 1,742 | 1,731 | 6,984 | 6,617 | |||||||
Cash flows used in financing activities | |||||||||||
Dividends paid, net | (1,742 | ) | (1,731 | ) | (6,984 | ) | (6,617 | ) | |||
Net cash used in financing activities | (1,742 | ) | (1,731 | ) | (6,984 | ) | (6,617 | ) | |||
Increase (decrease) in cash and cash equivalents during the period | - | - | - | - | |||||||
Cash and cash equivalents - Beginning of period | - | - | - | - | |||||||
Cash and cash equivalents - End of period | - | - | - | - |
Source:
2024 GlobeNewswire, Inc., source