Verso Paper (VRS) Reports Q1 EPS of $1.03, Revenues Beat; Offers Q2 Revenue Outlook Below Consensus

Verso Paper (NYSE: VRS) reported Q1 EPS of $1.03, versus $0.35 reported last year. Revenue for the quarter came in at $639 million versus the consensus estimate of $632.25 million.

• Net sales of $639 million, flat compared to first quarter 2018
• Net income of $36 million or $1.03 per diluted share
• Adjusted EBITDA of $69 million, up $28 million versus first quarter 2018

Overview "Verso had strong first quarter performance despite a very challenging market environment," said Verso Interim Chief Executive Officer Leslie T. Lederer. "While sales were flat, both price and mix were favorable as demand pressures increased across all product categories. An unfortunate result of these demand pressures was the difficult decision to close our paper mill in Luke, Maryland, which will reduce Verso\'s total coated freesheet production capacity by 450,000 tons," he said. "We remain committed to matching the supply of our products with our customers\' demand as we continue our efforts to move more production from graphic papers to specialty and packaging grades and pulp."

GUIDANCE:

Verso Paper sees Q2 2019 revenue of $620-640 million, versus the consensus of $647.74 million.

• Capital Expenditures of $32-35 million
• Major Maintenance of $21 million
• Cash pension funding of $7-9 million

Expectations for Full Year 2019

• Reinvesting in mills (higher maintenance and capital expenditures expected)
• Cash pension funding to be equal to 2018
• Luke Mill closure cash costs of approximately $25-35 million
• Finished goods at 2018 year end levels

For earnings history and earnings-related data on Verso Paper (VRS) click here.

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