International Paper Company

Ladies and gentlemen, thank you for standing by, and welcome to the first quarter Investor 2020 Earnings Day conference call. At this time, all participant lines are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 1 on your telephone keypad. To withdraw a question, press the pound key. Please be advised, today's conference is being recorded. If you require further assistance, press star zero. It's now my great pleasure to turn the conference over to Guillermo Gutierrez, Vice President, Investor Relations. Please go ahead, sir.

Thank you, Holly. Good morning, and thank you for joining International Papers' first quarter 2020 earnings call. Our speakers this morning are Mark Sutton, Chairman and Chief Executive Officer, and Tim Nichols, Senior Vice President and Chief Financial Officer. There is important information at the beginning of our presentation on slide two, including certain legal disclaimers. For example, during this call, we will make forward-looking statements that are subject to risks and uncertainties, including the impact of COVID-19. We will also present certain non-U.S. GAAP financial information. A reconciliation of those figures to U.S. GAAP financial measures is available on our website. press release, and today's presentation slides. Relative to the Olin Joint Venture and graphic packaging investments, slide two also provides context around the financial information and statistical measures presented upon those entities. I will now turn the call over to Mark Sutton.

Thank you, Guillermo, and good morning, everyone. Thank you for joining our call. We'll begin our discussion on slide three. The COVID-19 pandemic is unlike anything we've ever experienced. This pandemic brings unprecedented challenges and requires us to focus on what we as a company need to do to remain strong and resilient for all our stakeholders in the short term and the long term. International Paper entered this crisis in a position of strength. No strength is more important than the talent and commitment of our 50,000 employees worldwide. Our most important responsibility is the health and safety of our employees and contractors. I want to take this opportunity to thank our employees across the company and all of the business and support groups for their commitment and ability to adapt in this challenging period. I'm especially grateful to our frontline employees in manufacturing and converting facilities around the world. They ensure our customers can continue to supply essential products to consumers around the world. We also entered this crisis with world-class manufacturing and supply chain capabilities. flexibility and geographic reach allows us to meet our customers' rapidly changing needs, which is more important than ever in times like this. And we have a strong balance sheet and liquidity position that provides us financial flexibility to navigate through this period of great uncertainty. Turning to slide four, international paper is a critical part of the supply chain required to produce and deliver essential food, pharmaceutical, hygiene products, and emergency supplies for consumers around the world. This privilege comes with enormous responsibility to our employees and our customers. We've taken significant steps to protect our employees and contractors. We also implemented contact tracing protocols in all of our facilities. Our COVID-19 measures have proven to be effective, and we have not had any material disruptions to our operations. I'm proud of the collaboration, ingenuity, and commitment of our employees to take care of our customers during this pandemic. Some of our teams have generated product and service innovations for customers, while others have found ways to simplify and streamline work, all of which is essential to navigating effectively through the enormous dislocations caused by COVID-19. A few examples. Our packaging business developed corrugated separators, to allow citrus customers to run their packing operations with appropriate social distancing protection at the height of the harvest season. Our global cellulose fibers business is ensuring customers have real-time visibility of their orders, which is especially critical when ocean supply chains have stretched out. And our papers business quickly introduced new packaging sizes that allow safe home delivery of uncoated free sheet products. As I said earlier, International Paper entered this crisis in a strong financial position. Due to the unprecedented uncertainty regarding the ultimate economic impact of COVID-19, we are taking prudent actions to further strengthen the company's liquidity and preserve cash. We are undertaking vigorous sensitivity and scenario testing to make sure we make informed, principle-based decisions. And we manage each phase of this crisis with a view toward both the short-term and long-term success and sustainability of the company for all of our stakeholders. Now let's turn to our first quarter results on slide five. We deliver a solid performance with EBITDA of $802 million and free cash flow of $363 million in a very rapidly changing environment as containment measures across the globe accelerated. I am inspired by the commitment and resilience of our teams, who under unprecedented circumstances delivered strong operational performance in our mills and converting plants. In our packaging business, we were able to mitigate the impact of significant production loss in our Roman Bogalusa mills. We leveraged the scale and flexibility of our system to meet strong demand for corrugated packaging and absorbent pulp. And through outstanding collaboration across our commercial, supply chain, and manufacturing organizations, we adapted quickly to meet our customers' rapidly changing needs, all of which contributed to solid performance in the first quarter and further strengthened our position as we navigate the uncertainty that lies ahead. I'll turn it over now to Tim to cover performance across our business segments, our second quarter outlook, and details on actions we've taken to further strengthen our liquidity.