Sylvamo (SLVM) investor relations material

Executive summary

• Q1 2026 was marked by operational challenges, inventory build, and transition-related costs as the company prepared for the end of the Riverdale supply agreement and the Eastover Mill outage, resulting in a net loss of $3 million and adjusted EBITDA of $29 million (4% margin).

• Lean transformation initiatives were launched in Latin America and are expanding globally to drive operational efficiency and cost leadership.

• Strategic investments at Eastover Mill are progressing on schedule, with major upgrades and capacity additions expected to drive significant long-term value.

• Refinancing of 2027 debt and accounts receivable facility was completed, extending maturities and supporting financial flexibility.

• Net sales declined to $755 million, down 8% year-over-year, with all segments experiencing lower sales and profits.

Financial highlights

• Adjusted EBITDA for Q1 2026 was $29 million (4% margin), down from $125 million in Q4 2025 and $90 million in Q1 2025.

• Net loss was $3 million, compared to net income of $27 million in Q1 2025.

• Free cash flow was negative $59 million, compared to negative $25 million in Q1 2025 and positive $38 million in Q4 2025.

• Adjusted operating earnings per share were negative $0.53, compared to $1.08 in Q4 2025 and $0.68 in Q1 2025.

• Cash and temporary investments at quarter-end were $130 million.

Outlook and guidance

• 2026 is a transition year with free cash flow and earnings expected to be heavily weighted to the second half.

• Full-year negative adjusted EBITDA impact from North American footprint transition now estimated at $65 million, improved from $85 million, with most impact in the second half.

• Maintenance outage and one-time costs for 2026 expected at $115 million, with over 50% of total annual outage costs to occur in Q4.

• Capital spending projected at $95 million for high-return projects in 2026, with total annual capital expenditures of $165–$190 million.

• Long-term goal to generate over $300 million in annual free cash flow and 15%+ ROIC within three to five years.