Neenah Paper (NP) Tops Q3 EPS by 8c, Revenues Miss

Neenah Paper (NYSE: NP) reported Q3 EPS of $0.95, $0.08 better than the analyst estimate of $0.87. Revenue for the quarter came in at $231.8 million versus the consensus estimate of $246.5 million.

Third Quarter Highlights

• Net sales of $231.8 million decreased 10 percent compared with $256.2 million in the prior year. On a constant currency basis and excluding the impact of the December 2018 sale of the Brattleboro mill, net sales were down 6 percent.
• GAAP earnings per diluted common share (E.P.S.) of $0.84 compared with earnings of $0.75 per share in 2018.
• On an adjusted basis, 2019 quarterly E.P.S. of $0.95 increased from $0.76 in the prior year period. Adjusting items in 2019 consisted primarily of accelerated depreciation and other costs related to the idling of a fine paper machine. Adjusted E.P.S. is a non-GAAP measure used to enhance understanding and comparability of year-on-year results. Details on adjusting items and a reconciliation to comparable GAAP measures are included later in this release.
• Cash generated from operations of $33.4 million increased from $23.9 million in the third quarter of 2018. Cash flows in 2019 were used to reduce debt in the quarter by $19.1 million.
• Quarterly cash dividends paid of $0.45 per share increased 10 percent from $0.41 per share in the prior year.

"We continued to improve operating margins and delivered increased profits in the quarter through our actions to manage costs and pricing as input costs began to moderate from year-ago levels. Combined, these items more than offset impacts from volume challenges that reflected weaker market conditions," said John O'Donnell, Chief Executive Officer. "Our teams remain focused on optimizing cash flows, ensuring our solid financial position and strong balance sheet. This strategy provides Neenah with both the strength to weather a less certain global economic environment, and the ability to act prudently on value-adding investment opportunities."

For earnings history and earnings-related data on Neenah Paper (NP) click here.

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