Shares Plummet as Cascades Reports Wider Loss and Flat Revenue
Cascades experienced a significant drop in its shares after releasing its fourth-quarter financial results. The company reported a broader loss and stagnant revenue, falling short of analyst predictions. Additionally, Cascades anticipates a subdued performance in the upcoming first quarter.
Financial Overview
- Losses: Cascades posted a loss of C$57 million, or C$0.57 per share, compared to a loss of C$27 million, or C$0.27 per share, in the previous year.
- Adjusted Earnings: The adjusted earnings per share stood at C$0.05, lower than the anticipated C$0.32.
- EBITDA: The adjusted EBITDA reached C$122 million, showing a slight increase from C$116 million.
Analyst Insights
TD Cowen analyst Sean Steuart highlighted that the company failed to meet expectations, with adjusted EBITDA 17% below the estimated C$148 million. This performance was also weaker than the consensus forecast of C$149 million. Steuart noted a 10% decline in tissue segment shipments compared to the previous quarter.
Revenue and Outlook
Despite nearly flat sales of C$1.14 billion, Cascades fell short of the projected C$1.2 billion in revenue. CEO Mario Plourde commented on expectations for the first quarter, predicting a sequential decrease in results. This decline is attributed to challenges faced by the containerboard segment due to higher raw material costs and a slight drop in average selling prices.
The financial performance of Cascades reflects both the current market conditions and internal operational challenges. The company is gearing up to address these issues in the coming quarters.
