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Kruger Products sees 5.8% revenue hike over year-ago in Q2 results

KP Tissue Inc. has reported the Q2 2020 financial and operational results of KPT and Kruger Products L.P. (KPLP).

KPT currently holds a 14.8 per cent interest in KPLP.

KPLP Q2 2020 highlights

Revenue increased by $21.1 million, or 5.8 per cent, to $386.8 million in Q2 2020 compared to $365.7 million in Q2 2019.

Excluding the divested Mexico business, Q2 2020 revenue increased by $46.5 million, or 13.7 per cent.

Adjusted EBITDA was $64.4 million in Q2 2020 compared to $31.5 million in Q2 2019, an increase of 104.6 per cent.

The TAD Sherbrooke site is progressing on time and on budget despite the temporary shutdown in Q1 2020 due to the implementation of strict COVID-19 protocols.

The company declared a quarterly dividend of $0.18 per share to be paid on October 15, 2020.

“Our robust second quarter results were driven by a consistent increased demand in our consumer segment and strong operational performance,” says Dino Bianco, chief executive officer of KP Tissue, in a statement.

“As expected, the away-from-home segment faced challenging market conditions during the quarter and the road to recovery in this market will depend on the evolving COVID-19 situation.

“In addition to robust quarterly performance, we continue to reinvest in our brands and business in order to build an even stronger future. Lastly, I would like to thank the entire Kruger Products team for working safe while driving strong performance during COVID-19.”

KPLP outlook

Demand for products is expected to remain strong but at a diminishing growth rate in the consumer segment and weaker in the away-from-home segment, with input costs expected to remain unchanged.

As COVID-19 continues to evolve, there are many opportunities and uncertainties in the market. Given this, the company is providing a wide range for Q3 2020 adjusted EBITDA that is above Q3 2019 and below Q2 2020.

KPT Q2 2020 results

KPT had a net loss of $0.1 million in Q2 2020. Included in net loss was $4.3 million representing KPT’s share of KPLP’s net income, depreciation expense of $1.4 million related to adjustments to carrying amounts on acquisition and income tax expense of $3.3 million.

For the full Q2 2020 financial results for KPLP and KPT, click here.