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KP Tissue releases full-year 2019 financial results; revenue up for Kruger Products


March 12, 2020
By P&PC Staff

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KP Tissue Inc. has reported the Q4 2019 and full-year 2019 financial and operational results of KPT and Kruger Products L.P. (KPLP), citing an increase in revenue for KPLP of 4.6 per cent for the year.

KPT currently holds a 15 per cent interest in KPLP.

“Our fourth quarter adjusted EBITDA increased by a strong 87.5 per cent to $46.0 million compared to a weak Q4 last year. We are very pleased with fiscal 2019’s performance, particularly with the strong second half, reflecting volume growth and the benefit of previous pricing actions in all business segments and a favourable cost environment,” says Dino Bianco, CEO of KP Tissue and KPLP.

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KPLP Q4 2019 business and financial highlights

  • Revenue decreased by $11.2 million or 3.1 per cent to $348.1 million in Q4 2019 compared to $359.3 million in Q4 2018.
  • Excluding the divested Mexico business, Q4 2019 revenue increased by $13.1 million or 3.9%.
  • Adjusted EBITDA was $46.0 million in Q4 2019 compared to $24.5 million in Q4 2018, an increase of 87.5 per cent.
  • TAD Sherbrooke facility progressing on time and on budget.
  • Declared a quarterly dividend of $0.18 per share to be paid on April 15, 2020.

KPLP full-year 2019 business and financial highlights

  • Revenue increased by 4.6 per cent to $1,434.1 million in 2019 compared to $1,370.4 million in 2018.
  • Adjusted EBITDA was $145.0 million in 2019, up from $118.3 million in 2018, an increase of 22.6%.
  • Amended senior credit facility to increase overall borrowing capacity by $50 million.

“TAD Sherbrooke is progressing on all fronts as planned and on budget. The launch of commercial production remains on target for early 2021, which will allow us to continue to grow our business in North America with our brands and customers,” says Bianco.

“Our operational transformation initiatives including the Operational Excellence (OpEx) program are yielding the anticipated cost savings and will continue into 2020 with a goal of $15 – $20 million on a run-rate basis by the end of this year.”

KPT Q4 2019 financial results

KPT had a net loss of $1.6 million in Q4 2019. Included in the net loss was $1.0 million representing KPT’s share of KPLP’s net loss, depreciation expense of $1.4 million related to adjustments to carrying amounts on acquisition and an income tax recovery of $0.6 million.

KPT 2019 financial results

KPT had a net loss of $6.5 million in 2019. Included in the net loss was $0.3 million representing KPT’s share of KPLP’s net income, depreciation expense of $5.7 million related to adjustments to carrying amounts on acquisition, income tax expense of $1.7 million and a dilution gain of $0.6 million.

Outlook

With favourable input costs compared to Q1 2019 along with the benefits of the company’s operational transformation initiatives, partially offset by incremental spending, Q1 2020 adjusted EBITDA is expected to be higher than the year-ago quarter, while being sequentially lower than Q4 2019 due to seasonally lower sales volume.

The company says it continues to monitor the risks associated with COVID-19 (novel coronavirus) and the uncertainty that it represents.

View the full KP Tissue Inc. Q4 2019 and full-year 2019 report, including detailed financial results.