Cascades (CAS) Q1 2026 earnings summary

Executive summary

• Q1 2026 sales were $1,125 million, down 6% sequentially and 3% year-over-year, with adjusted EBITDA(A) at $118 million and net earnings at $39 million, impacted by severe weather, geopolitical events, and lower consumer confidence.

• Adjusted net earnings were $7 million, with adjusted EPS of $0.07, reflecting lower volumes and higher costs despite price increases.

• Operational improvements at Bear Island and Greenpac facilities led to record production and higher capacity utilization.

• Asset sales generated $91 million in Q1, supporting stable net debt of $1,901 million and leverage at 3.3x.

• Strategic focus on operational agility, logistics efficiency, and onboarding new packaging volumes.

Financial highlights

• Q1 Adjusted EBITDA(A) was $118 million (10.5% margin), down from $155 million in Q4 2025 and $125 million in Q1 2025.

• Q1 net earnings per share were $0.38 reported, $0.07 adjusted, compared to $0.13 last year.

• Adjusted cash flow from operations was $59 million, with capital expenditures at $28 million.

• Net debt stood at $1,901 million, leverage ratio at 3.3x, and available liquidity at $738 million.

• Asset sales generated $91 million in Q1, progressing toward a $230 million target by Q3 2026.

Outlook and guidance

• Q2 2026 consolidated results expected to be slightly lower sequentially due to continued macro uncertainty and cost pressures.

• Packaging EBITDA(A) guidance: $93–$103 million; Tissue: $31–$34 million; Corporate: ($20)–($19) million.

• Tissue volumes forecasted to rise in Q2, with ongoing margin pressure but stronger performance anticipated in H2 2026.

• Targeting annualized run rate of $600 million Adjusted EBITDA(A) in H2 2026, driven by price increases and operational initiatives.

• Targeted leverage ratio of 2.5x–3.0x by year-end may be challenging but remains unchanged.