Sylvamo Corporation

Good morning, thank you for standing by. Welcome to Sylvamo's first quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, you will have an opportunity to ask questions. To ask a question, please press star one on your telephone keypad. To withdraw a question, simply press star one again. As a reminder, your conference is being recorded. I'd now like to turn the call over to Hans Bjorkman, Vice President, Investor Relations. Sir, the floor is yours.

Thanks, Sarah. Good morning, and thank you for joining our first quarter 2025 earnings call. Our speakers this morning are Jean-Michel Rivieres, Chairman and Chief Executive Officer, and John Sims, Senior Vice President and Chief Operating Officer. Slides two and three contain important information, including certain legal disclaimers. For example, during this call, we will make forward-looking statements that are subject to risks and uncertainties. We will also present certain non-US GAAP financial information. Reconciliations of those figures to US GAAP financial measures are available in the appendix. Our website also contains copies of the earnings release, as well as today's presentation. With that, I'd like to turn the call over to Jean-Michel.

Thanks, Anne. Good morning, and thank you for joining our call. I'll start on slide four, highlighting some news we announced a few weeks ago. After over three decades of working in the paper and packaging industry, I've decided to retire at the end of the year. Serving as a chairman and CEO of Sylvamo for the past four years has been one of the greatest highlights of my career. I'm pleased that John seems to become the next CEO of Sylvamo. John was elected chief operating officer, effectively one, and will lead our commercial and operational functions. Following my retirement, John will assume the role of the CEO on January 1st, 2026. As you know, John has served as the CFO of Sylvamo since the spin-off and has been instrumental in our work to build the world's paper company and drive our company's strong performance. Tom Devlin was then Senior Vice President and Chief Financial Officer, effective May 1, and he's with us here for today's call. You'll hear more from Don in future earnings calls. He joined us on International Paper after 27 years with the company. Don has extensive international leadership experience with a track record of building teams, developing strategic plans, and delivering results in diverse and challenging environments. He served in a variety of leadership roles including finance director for European papers, chairman and CEO of IP's and Cote's Fishies business in India, and most recently past president finance and strategy for IP industrial packaging. I'm excited to have both John and Dawn in the new leadership roles to drive the company forward for future success. Slide five shows our first quarter highlights. First, we successfully completed a heavy plant maintenance outage quarter in Europe and North America. Also, these outages were executed well. We ran into some separate non-outage related operational challenges, primarily in North America. John will talk more about the financial impact in a few slides. We also began implementing the previously communicated uncoated free sheet price increases to customers in Brazil and North America. Lastly, we returned nearly $40 million in cash to share owners. We distributed 18 million via the first quarter dividend. And as of today, we have repurchased 20 million in shares this year. Let's move to the next slide. Slide six shows our first quarter key financial metrics. We earn adjusted a bit of $90 million with a margin of 11%. In addition to having almost 30 millions of planned maintenance audited costs, the first quarter is our weakest demand quarter every year in Latin America. We generated adjusting operating earnings of 68 cents per share. As expected, free cash flow was lower than the fourth quarter due to the timing of year-end payments. One-time cash benefit in the fourth quarter from the monetization of working capital related to the closure of IP Georgetown Mills and the payment of annual incentive compensation in the first quarter. Keep in mind that our free cash flow is heavily weighted to the second half of the year. The last two years, we generated almost 90% of our free cash flow in the second half. Now John will review our performance in more detail.