Rayonier Advanced Materials (RYAM) Tops Q4 EPS by 6c; Offers Outlook

Rayonier Advanced Materials (NYSE: RYAM) reported Q4 EPS of $0.30, $0.06 better than the analyst estimate of $0.24. Revenue for the quarter came in at $242 million versus the consensus estimate of $247.58 million.

Outlook

Industry oversupply and weak end-market demand continue to put near-term pricing pressure on the Company’s cellulose specialties business. Pressure on acetate products, key to the Company’s profitability, persists as overproduction by customers coupled with modest declines in cigarette demand led to a buildup of acetate product inventories in the supply chain. In other markets, demand is increasing driven by growth in high-strength viscose, casings, tire cord and certain ether end-markets. As a combined result of these market conditions and customer negotiations, the Company expects 2016 cellulose specialties prices and sales volumes to be down compared to 2015 6 to 7 percent and 4 to 5 percent, respectively. The Company anticipates generating pro forma EBITDA between $175 million and $190 million in 2016 and $75 to $85 million of adjusted free cash flow. Based on contractual commitments for the majority of the Company’s acetate volume, 2017 acetate pricing is expected to be approximately 2 percent below 2016.

For earnings history and earnings-related data on Rayonier Advanced Materials (RYAM) click here.

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