Strong performance while investing in the business
Mississauga (ON), March 7, 2024 - KP Tissue Inc. (KPT) (TSX: KPT) reports the Q4 2023 and full year 2023 financial and operational results of KPT and Kruger Products Inc. (Kruger Products). Kruger Products is Canada's leading manufacturer of quality tissue products for the Consumer market (Cashmere®, Purex®, SpongeTowels®, Scotties®, White Swan® and BonterraTM) and the Away-From-Home (AFH) market and continues to grow in the U.S. Consumer tissue business with the White Cloud® brand and premium private label products. KPT currently holds a 12.9% interest in Kruger Products.
Kruger Products Q4 2023 Business and Financial Highlights
- Revenue was $482.3 million in Q4 2023 compared to $458.1 million in Q4 2022, an increase of $24.2 million or 5.3%.
- Adjusted EBITDA1 was $61.2 million in Q4 2023, compared to $44.4 million in Q4 2022, an increase of 37.9%.
- Net income was $16.5 million in Q4 2023 compared to $16.0 million in Q4 2022, an increase of $0.5 million.
- Declared a quarterly dividend of $0.18 per share to be paid on April 15, 2024.
- Facial tissue line in the Sherbrooke Expansion Project started up successfully in February 2024.
- Announced a 25% increase in facial production at the Gatineau plant on March 5, 2024 with a $14.5 million investment.
Kruger Products Full Year 2023 Financial Highlights
- Revenue was $1,873.0 million in Fiscal 2023 compared to $1,681.4 million in Fiscal 2022, an increase of $191.6 million or 11.4%.
- Adjusted EBITDA1 was $238.6 million in Fiscal 2023, compared to $116.0 million in Fiscal 2022, an increase of 105.7%.
- Net loss was $5.3 million in Fiscal 2023 compared to $56.9 million in Fiscal 2022, a decrease in the loss of $51.6 million.
“We are pleased with our financial results in fiscal 2023, highlighted by record sales of $1.9 billion and record Adjusted EBITDA of $238.6 million driven by many positive factors,” stated KP Tissue’s Chief Executive Officer, Dino Bianco. “Overall, our business benefited from robust volume, positive margin management with continued volatile costs, and strong operational efficiency across our network.''
“In our Consumer segment, we gained market share within the facial tissue and paper towel categories, while improving our share trend on bathroom tissue. We also stepped up to support and supply our Scotties facial tissue to customers and consumers given the exit of Kleenex from the Canadian grocery market. Our Away-From-Home business continued to deliver sustainable results with another strong Adjusted EBITDA quarter and year.”
“In the fourth quarter, our underlying results remained solid with Adjusted EBITDA growing 37.9% year-over-year to $61.2 million, despite strategically increasing investments in marketing and maintenance to enable us to enter 2024 in a stronger competitive position. Looking ahead, we plan to manage our margins amid rising costs, continue to invest in our brands, grow our facial tissue position, and implement a successful start-up of our Sherbrooke Expansion,” Mr. Bianco concluded.
Outlook for Q1 2024
For the first quarter of 2024, we expect margins to remain consistent and Adjusted EBITDA1 to be in a similar range to Q4 2023.
Source: KP Tissue
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