Resolute Forest Products (RFP) Tops Q2 EPS by 5c, Revenues Miss

Resolute Forest Products (NYSE: RFP) reported Q2 EPS of $0.77, $0.05 better than the analyst estimate of $0.72. Revenue for the quarter came in at $976 million versus the consensus estimate of $982.5 million.

Q2 GAAP net income of $72 million or $0.77 per diluted share
Adjusted EBITDA of $172 million, up 59% from first quarter
Debt repayment of $105 million; liquidity at $517 million
Supercalendered paper cash duty deposits of $60 million to be returned with interest

"Overall positive price momentum and improved operational performance led to record profitability this quarter. Our strong financial results allowed repayment of $105 million of debt during the quarter, significantly improving our balance sheet and leverage," said Yves Laflamme, president and chief executive officer. "We are also very pleased that the countervailing duty order on supercalendered paper has recently been revoked, resulting in a $60 million refund of duty deposits over the coming months."

"Our view on pulp markets remain optimistic through the third quarter, as supply and demand dynamics are expected to be strong in most markets. Despite extensive pulp downtime related to the major capital project in Saint-Félicien, which will increase pulp production in the long term, we expect our pulp performance to remain solid. We believe the underlying market fundamentals for lumber will support healthy operating results in the medium term, in spite of a recent pull back in lumber prices. Paper markets are expected to remain favorable in the third quarter, as we continue to benefit from rising prices across our product offering. For tissue, we have made progress in increasing sales and market penetration. Our operations are now focused on supporting our strengthening market position," added Mr. Laflamme.

For earnings history and earnings-related data on Resolute Forest Products (RFP) click here.

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