WASHINGTON (dpa-AFX) - Providing a preliminary update to its previous outlook for second quarter, Clearwater Paper Corp. (CLW) on Monday raised its Adjusted EBITDA guidance for the second quarter, due to demand, production, and cost trends in April and May that were more favorable than previously anticipated.
For the second quarter, the company now expects Adjusted EBITDA in a range of $71 million to $77 million, up from the previous outlook in the range of $45 million to $55 million.
The company also now projects net income for the second quarter in a range of $21 million to $26 million.
The company said it continued to see strong tissue demand with shipments up nearly 30% versus 2019 averages through April and May. While order pace is starting to normalize in June, it anticipates production in the second quarter to exceed expectations and match increased demand, which would drive an improvement in overall cost structure.
In addition, the company's paperboard business is expected to remain stable in the second quarter, with strength in its core market segments offsetting recessionary impacts.
The company is also on track with ramping tissue production at its Shelby, North Carolina expansion, with the paper machine approaching its full run-rate targets.
The company said it intends to continue using free cash flows to pay down debt, either through optional repayments or open market repurchases, including the company's bank debt, senior notes maturing in 2023 and 2025, or both.
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