Domtar (UFS) Tops Q1 EPS by 9c, Revenues Miss

Domtar (NYSE: UFS) reported Q1 EPS of $1.44, $0.09 better than the analyst estimate of $1.35. Revenue for the quarter came in at $1.38 billion versus the consensus estimate of $1.44 billion.

• First quarter 2019 net earnings of $1.27 per share; earnings before items1 of $1.44 per share
• Paper prices $30 per ton higher quarter-over-quarter
• Paper shipments increased 2% quarter-over-quarter

“We had a solid performance from Pulp and Paper despite a wood fiber shortage that negatively impacted costs and output,” said John D. Williams, President and Chief Executive Officer. “Price and volume momentum in paper continued in a favorable market environment, which led to strong productivity and a good cost performance. The pulp business was impacted by lower prices while higher internal pulp shipments due to wood fiber constraints negatively impacted our volumes. Nevertheless, we continued to improve and increase overall productivity and manage costs through saving initiatives.

Mr. Williams added, “In Personal Care, our margins improved driven by better productivity and operational efficiencies as our new customer ramp-up accelerates. We also successfully implemented price increases in both North America and Europe helping to partially offset raw material cost headwinds. Our teams continue to deliver on our margin improvement plan which is expected to progress throughout the year.”

OUTLOOK

Our paper shipments should benefit from higher demand from our customers following the industry capacity closures while our paper prices will further improve as we continue to implement our recently announced price increases. The second quarter will be adversely affected by seasonally higher maintenance activity in our Pulp and Paper business as we move into the annual shutdowns at some of our major facilities. Personal Care is expected to benefit from our margin improvement plan and the ramp-up of a new customer, partially offset by further raw material cost inflation.

For earnings history and earnings-related data on Domtar (UFS) click here.

You May Also Be Interested In

• Tesla plans 'flying' Roadster stunt at SpaceX Texas site as early as August
• Pro Diversity Network (IPDN) Reports Q2 Loss of $0.15
• Reading (RDI) Tops Q2 EPS by 4c