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    RYAM
    Earnings call· Jun 2026(Q2 FY26)

    RAYONIER ADVANCED MATERIALS Q2 FY26 earnings call RYAM

    Aug 5, 2026 Source

    Executive summary

    Rayonier Advanced Materials Q2 FY26 — Strategic Review Progresses Amidst Strong Sequential Improvement

    Rayonier Advanced Materials reported strong sequential financial improvements in Q2 FY26, driven by higher pricing and volumes in its Cellulose Specialties segment. The company is actively progressing its strategic review, aiming for a Q4 conclusion, while simultaneously focusing on operational enhancements and cash generation to strengthen its financial position and maximize shareholder value. New CEO Dan Krawczyk emphasized the dual priorities of executing the business and advancing the strategic review, highlighting opportunities in commercial execution and operational efficiency.

    Highlights

    5

    • Adjusted EBITDA increased to $40 million, up from $8 million sequentially and $28 million year-over-year.

    • High Purity Cellulose (HPC) adjusted EBITDA increased $12 million year-over-year to $57 million, with margin expanding to 19%.

    • Cellulose Specialties (CS) pricing increased 8% sequentially and 21% year-over-year, with sales volumes improving 19% sequentially.

    • Total liquidity stood at $145 million, including $57 million cash and $76 million ABL availability.

    • Adjusted free cash flow improved by $57 million year-over-year to negative $8 million, on track for positive FCF for the year.

    Concerns

    5

    • Loss from continuing operations was $33 million, including a $13 million noncash asset impairment charge.

    • Paperboard and high-yield pulp adjusted EBITDA declined $8 million year-over-year to negative $10 million.

    • High-yield pulp pricing remained under pressure, and paperboard pricing was below prior year levels.

    • Elevated leverage with adjusted net debt at $755 million and net secured leverage at 4.2x covenant EBITDA.

    • Potential material impact from recently announced tariffs on certain Canadian-sourced paperboard products.

    Guidance & targets

    8
    CategoryTargetConfidence
    Strategic Review Conclusion
    Communicate a clear path forward
    high materiality
    High
    Free Cash Flow
    Positive free cash flow
    high materiality
    High
    Cellulose Specialties (CS) Pricing
    Remain significantly above prior year levels
    medium materiality
    High
    Cellulose Specialties (CS) Volumes
    Improve compared with the first half
    medium materiality
    Medium
    Cellulose Commodities Pricing
    Modest improvement
    low materiality
    Medium
    Paperboard Pricing Outlook
    Firmer outlook
    low materiality
    Medium
    Earnings Run Rate and Financial Flexibility
    Stronger earnings run rate and greater financial flexibility
    high materiality
    Medium
    High Purity Cellulose (HPC) Volumes
    10% to 15% improvement
    medium materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    High Purity Cellulose
    Adjusted EBITDA improved due to higher CS pricing, improved operating rates, and lower wood and fixed costs, partially offset by lower CS volumes, higher commodity mix, and inflation. Volumes remained lower year-over-year as the company executed value-based pricing initiatives.
    Adjusted EBITDA Margin: 19%CS pricing sequential increase: 8%CS pricing year-over-year increase: 21%CS sales volumes sequential improvement: 19%Cellulose Commodities pricing sequential improvement: 6%Cellulose Commodities pricing year-over-year decline: 11%Cellulose Commodities volumes year-over-year increase: nearly doubled
    		$301 millionUp $29 millionUp $38 million$57 million Adjusted EBITDA
    Paperboard and High-Yield Pulp
    Adjusted EBITDA declined due to lower pricing and planned maintenance/market-related downtime, which more than offset higher volumes. Tighter market conditions supported sequential pricing improvement, but pricing remained below prior year levels. High-yield pulp pricing remained under pressure.
    Paperboard pricing sequential increase: 3%Paperboard volumes sequential improvement: 11%High-yield pulp volumes sequential increase: nearly doubledHigh-yield pulp volumes year-over-year increase: 29%
    		$75 millionUp $7 millionUp $19 millionNegative $10 million Adjusted EBITDA

    Operational metrics

    17
    Loss from continuing operations
    $33 millionImproved from $81 million in Q1 FY26
    Q2 FY26

    Included a $13 million noncash asset impairment charge related to high-yield pulp.

    Adjusted EBITDA
    $40 millionUp from $8 million in Q1 FY26 and $28 million in Q2 FY25
    Q2 FY26

    Total company adjusted EBITDA.

    Adjusted EBITDA Year-over-Year Increase
    43%Up $12 million
    Q2 FY26

    Compared with the prior year quarter.

    Total Liquidity
    $145 million
    End of Q2 FY26

    Consisted of cash, North American ABL facility, and France factoring facility.

    Cash Balance
    $57 million
    End of Q2 FY26

    Part of total liquidity.

    North American ABL Facility Availability
    $76 million
    End of Q2 FY26

    Part of total liquidity.

    France Factoring Facility Availability
    $12 million
    End of Q2 FY26

    Part of total liquidity.

    Adjusted Net Debt
    $755 million
    End of Q2 FY26

    Company's adjusted net debt level.

    Net Secured Debt
    $726 million
    End of Q2 FY26

    Company's net secured debt level.

    Net Secured Leverage
    4.2xvs. covenant test of 4.75x
    End of Q2 FY26

    Remained in compliance with all debt covenants.

    Cash Provided by Operating Activities
    $37 million
    Year-to-Date

    Year-to-date cash generation from operations.

    Capital Expenditure
    $45 million
    Year-to-Date

    Includes $9 million for strategic projects. Focus on preserving liquidity and managing CapEx.

    Noncash Asset Impairment Charge
    $13 million
    Q2 FY26

    Related to high-yield pulp, included in loss from continuing operations.

    High Purity Cellulose (HPC) Adjusted EBITDA
    $24 million
    Q1 FY26

    Baseline for comparison to Q2 FY26 HPC Adjusted EBITDA of $57 million.

    Section 301 Tariff on Brazilian Dissolving Wood Pulp
    37.5%
    Q3 FY26

    Announced by USTR, covering imports from Brazil.

    Section 301 Tariff on Norwegian Dissolving Wood Pulp
    12.5%
    Q3 FY26

    Announced by USTR, covering imports from Norway.

    Paperboard Volume Sold into U.S.
    75%
    Current

    Roughly 75% of RYAM's paperboard volume is sold into the U.S., making it susceptible to Canadian tariffs.

    Industry KPIs

    2
    MetricValueDetails
    Volume vs price split—
    Productivity cost savings program—

    Product announcements

    1
    ProductTypeDetails
    Freezer board, oil and grease resistant grades, and softwood rolled high-yield pulplaunch

    Capital programs

    1
    Altamaha Green Energy projectunderway

    RYAM has a capital-light interest in this project through its land and prior investments, preserving potential upside without requiring additional cash equity from the company. It's an example of advancing biomaterials opportunities.

    Risks & headwinds

    10
    Noncash asset impairment chargeQ2 FY26

    $13 million

    Lower Cellulose Specialties (CS) volumesQ2 FY26

    Lower year-over-year

    Mitigation: Executing value-based pricing initiatives; expected H2 volume improvement.

    Higher commodity mixQ2 FY26

    Impacted HPC Adjusted EBITDA

    Mitigation: Focus on aligning production with most attractive product mix.

    InflationQ2 FY26

    Partially offset benefits in HPC

    Mitigation: Cost recovery actions, disciplined capital allocation, operational improvements.

    Lower paperboard pricingQ2 FY26

    Below prior year levels

    Mitigation: Commercializing new high-value products; tighter market conditions supporting firmer outlook.

    Planned maintenance and market-related downtimeQ2 FY26

    Impacted Paperboard and high-yield pulp Adjusted EBITDA

    Mitigation: Focus on targeted improvements in reliability and productivity.

    High-yield pulp pricing pressureQ2 FY26

    Pricing remained under pressure

    Mitigation: Commercializing new high-value products; monitoring trade dynamics.

    Tariffs on certain Canadian-sourced productsOngoing

    Potential to materially impact economics of paperboard and high-yield pulp business (75% of paperboard volume sold into U.S.)

    Mitigation: Actively working with policymakers; developing commercial and operational actions.

    Challenged end marketsOngoing

    Certain end markets continue to be challenged

    Mitigation: Disciplined commercial execution, closer customer collaboration, product innovation.

    Elevated leverageEnd of Q2 FY26

    Adjusted net debt $755 million; net secured leverage 4.2x covenant EBITDA

    Mitigation: Focus on strengthening earnings run rate and cash generation, positioning for refinancing alternatives.

    What to watch in Q3 FY26

    5

    Strategic Review Conclusion

    Q4 2026
    CurrentActive, progressing with urgency and discipline.
    TargetCommunicate a clear path forward.

    Why it matters

    This will determine the company's future strategic direction and potential for shareholder value maximization.

    We currently expect to conclude the strategic review and communicate a clear path forward during the fourth quarter.

    Q&A highlights

    8

    What about RYAM and your experience gives you confidence in unlocking shareholder value, whether through strategic review or stand-alone operation?

    CEO Dan Krawczyk stated he was hired to maximize shareholder value by supporting the strategic review and strengthening the business. He joined due to strong end markets, the differentiated Cellulose Specialties platform, tangible operational improvement opportunities, and upside from byproducts (biomaterials). His background aligns with growth, restructuring, and strategic evaluations.

    “Why I was hired was to maximize shareholder value by supporting the rigorous strategic review process and continuing to strengthen the business during that process. That ultimately will give us the best flexibility to maximize value for our shareholders.”

    asked by Daniel Harriman · answered by Daniel Krawczyk

    2 min read5 chapters

    Detailed Narrative

    01

    Strategic Review and New Leadership

    The comprehensive strategic review remains a top priority, progressing with urgency and discipline, expected to conclude and communicate a path forward during Q4 2026. New President and CEO Dan Krawczyk affirmed his mandate to maximize shareholder value by supporting the review, strengthening business performance, and preparing for effective execution of the selected path. His background in manufacturing, specialty chemicals, and advanced materials aligns with the company's transformation goals, reinforcing his conviction that RYAM possesses substantial untapped value.

    02

    Untapped Value and Core Strengths

    RYAM's core value is centered on its highly differentiated Cellulose Specialties franchise, which holds leading market positions, specialized assets, deep technical expertise, and strong customer relationships. These products serve demanding applications in pharmaceuticals, food, filtration, and other industrial sectors, where purity, consistency, and technical performance are critical. The company is also a critical North American supplier of nitrocellulose grade dissolving wood pulp for defense and industrial applications, reinforcing the strategic relevance of its assets.

    03

    Operational Improvement Opportunities

    Management has identified a tangible pipeline of reliability, productivity, and cost initiatives across its manufacturing network, including energy efficiency, process optimization, and automation. The objective is to operate mills more reliably and efficiently by aligning production with the most attractive product mix and prioritizing markets where RYAM has the strongest competitive position. These actions are clear, actionable levers within the company's control, designed to improve earnings and cash generation capabilities.

    04

    Commercial Strategy and Biomaterials

    RYAM's strategy is to build on its strengths through disciplined commercial execution, closer customer collaboration, and continued product innovation, helping customers differentiate their products. The company is also selectively advancing biomaterials opportunities, such as the capital-light Altamaha Green Energy project, which preserves potential upside without requiring additional cash equity. This approach leverages existing infrastructure and assets to grow into new end markets like CTO or prebiotics, focusing on attractive investment economics and disciplined capital deployment.

    05

    Trade Actions and Market Conditions

    RYAM is actively engaged in trade actions to support fair and competitive conditions in U.S. markets. The USTR announced final Section 301 tariffs of 37.5% on Brazilian dissolving wood pulp and 12.5% on Norwegian dissolving wood pulp, with final antidumping and countervailing duty determinations expected later in the year. The company is also monitoring recently announced tariffs on certain Canadian-sourced paperboard products, which could materially impact its business, and has developed operational and commercial mitigation plans.

    AI-generated summary of the company’s earnings call. Not investment advice.