Financial Reports & Markets
Cascades announces strategic plans for 2022 to 2024
February 24, 2022 By P&PC Staff
Cascades recently unveiled its 2022-2024 strategic update, charting out what lies ahead for the company.
The company’s strategy commits to leveraging its strong asset base and product portfolio to accelerate value creation and improve profitability.
The strategy also introduces new financial targets focusing on free cash flow generation and a plan to improve the profitability of its tissue group.
“Our plan aims to generate value for shareholders, accelerate profitability improvement and strengthen our tissue business, all while continuing to prioritize sustainability, which has been at the core of our strategy since we started business,” said president and CEO, Mario Plourde.
“Cascades is an integrated company with strong assets to fuel future profitable growth, and I am confident we have the right team and the right experience to execute on our plan that aims to generate $5 billion of revenue in 2024.”
In packaging, Cascades’ strategic plan aligns with market growth areas.
Key pillars of this action plan for the packaging segments include:
- Completing the start-up of Bear Island in Q4 2022
- Increasing integration with new converting capacity in the United States
- Accelerating the pace of new sustainable product development and commercial launches
- Growing the combined revenue of its packaging businesses to over $3.5 billion in 2024
- Targeting OIBD margins for 2024 of 19 percent to 21 percent in containerboard packaging and of 17 percent to 19 percent in specialty packaging products.
Cascades’ tissue business has been particularly impacted by the COVID-19 pandemic. The tissue market will provide opportunities for growth as the effects of the pandemic subside.
The company’s tissue assets are well-positioned to benefit from this recovery. Between 2017 and 2020 the company made significant investments to modernize and consolidate its assets and focus on volume and profitability improvements. Moving forward, its immediate priority is to execute a comprehensive action plan that will accelerate profitability and strengthen the fundamentals of the tissue business.
Key pillars of this action plan for the tissue segment include:
- Leveraging the well-capitalized tissue asset base and limiting investments to $35 million annually through 2024
- Focusing on production execution and efficiency
- Strengthening commercial strategies to drive value
- Achieving revenue of $1.7 billion and an OIBD margin of nine percent to 10 percent in 2024
“Over the last 10 years, we have taken a number of important strategic steps to reposition our business and adapt to evolving market dynamics and customer needs. I’m proud of the work we have accomplished, and I think that with this renewed vision, we are better equipped than ever to deliver for customers and shareholders” said Plourde.
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