Q3 2024 Mercer International Inc Earnings Call Transcript
Key Points
- Mercer International Inc (MERC) reported an increase in operating EBITDA to $50 million in Q3 2024, up from $30 million in Q2, driven by fewer days of planned maintenance downtime.
- The Pulp segment contributed a strong quarterly EBITDA of $55 million, indicating robust performance in this area.
- Softwood pulp markets remained steady with stable prices, and the North American NBSK list price increased by $65 per tonne from Q2.
- The company successfully completed refinancing of its 2026 senior notes, reducing debt by $100 million and extending maturities by two years.
- Mass timber operations within the Solid Wood segment showed strong performance, completing two large projects in the US and maintaining consistent revenue and margins.
- Unplanned downtime at several mills significantly reduced pulp production in Q3, negatively impacting EBITDA by approximately $20 million.
- The Solid Wood segment reported a negative EBITDA of $2 million, reflecting challenges in this area.
- Hardwood prices in China decreased due to new capacity, leading to a $4 million noncash inventory impairment against hardwood fiber inventories.
- Foreign exchange movements negatively impacted operating income by about $10 million due to a weakening US dollar.
- The company reported a consolidated net loss of $18 million for Q3, although this was an improvement from a $68 million loss in Q2.
Good morning and welcome to Mercer International's third quarter 2024 earnings conference call. On the call today is Juan Carlos Bueno, Mercer's President and Chief Executive Officer; and Richard Short, Mercer's Chief Financial Officer and Secretary.
I will now hand the call over to Richard.
Thanks, Josh. Good morning, everyone. Thanks for joining us today. I will begin by touching on the financial and operating highlights of the third quarter before turning the call to Juan Carlos to provide further color into the markets, our operations and our strategic initiatives.
Also, for those of you that have joined today's call by telephone, there is presentation material that we have attached to the Investors section of our website.
But before turning to our results, I'd like to remind you that we will be making forward-looking statements in this morning's conference call. According to the safe harbor provisions of the Private Securities
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