News Financial Reports & Markets
Resolute’s second quarter results reflect the impact of ongoing challenges

Resolute Forest Products reported net income for the quarter ended June 30 of $256 million, or $3.29 per diluted share. Numbers were down compared to a net income of $268 million, or $3.34 per diluted share, in the same period in 2021.

Sales in the second quarter of the year were at $1,058 million, a decrease of $82 million from the year-ago period. Excluding special items, the company reported a net income of $155 million, or $2.00 per diluted share. This was down compared to a net income of $300 million, or $3.74 per diluted share, in the second quarter of 2021.

The company reported an operating income of $217 million in the second quarter, compared to $235 million in the first quarter. The $18 million variation mainly reflects higher shipments ($47 million) across all segments, more than offset by higher manufacturing costs ($55 million), mainly related to fibre ($25 million) and maintenance ($19 million) costs, as well as energy prices ($7 million). The overall impact of pricing was neutral as higher realized transaction prices in the pulp and paper segments were offset by lower average transaction prices in the wood products segment. The company also recorded higher freight ($8 million) and selling, general and administrative expenses ($4 million).

Market Pulp

Operating income in the market pulp segment was $41 million in the second quarter, $19 million higher than in the prior quarter. The average transaction price increased by $117 per metric ton, or 14 percent, due to stronger market conditions. Shipments were 29,000 metric tons higher, helping to reduce finished goods inventory by 14,000 metric tons to 68,000 metric tons at quarter-end. The delivered cost rose by $42 per metric ton, mainly due to higher maintenance and fibre costs. EBITDA in the segment improved by $22 million, to $48 million.

Tissue

The tissue segment incurred an operating loss of $9 million in the quarter, in line with the first quarter. The average transaction price increased by $84 per short ton, or four percent, on rising market pricing. Shipments were 1,000 short tons higher and finished goods inventory fell by 2,000 short tons. The delivered cost increased by $126 per short ton, or six percent, mostly due to higher market pulp prices. EBITDA in the segment fell by $1 million, to a negative $5 million.

Paper

The paper segment recorded operating income of $37 million in the quarter, an improvement of $12 million over the previous quarter. The average transaction price rose by $35 per metric ton, or five percent, due to stronger market conditions in all grades. Shipments rose by 29,000 metric tons, helping to reduce finished goods inventory by 18,000 metric tons to 67,000 metric tons at quarter-end. The delivered cost increased by $11 per metric ton, or two percent, mainly due to higher freight and maintenance costs. EBITDA improved by $13 million, to $47 million.