Verso Corp. Accomplished Dramatic Turnaround in H2 2017

SEATTLE (Scrap Monster): Verso Corporation- North America’s leading producer of printing papers, specialty papers and pulp has announced financial results for the fourth quarter of 2017 and for the full year 2017. The company delivered a dramatic turnaround in results during the last six months of the previous year.

The company reported net sales of $639 million during the fourth quarter of 2017, slightly lower by $7 million when compared with the corresponding quarter in 2016. The decline in sales was mainly attributed to reduced demand for coated papers and capacity reductions at its Androscoggin Mill. The company had temporarily idled the mill operations in January 2017. Q4 also reported net income of $36 million and adjusted EBITDA of $65 million.

The net sales during the entire year 2017 declined by $180 million when compared with 2016. The sales decline was primarily attributed to huge fall in total sales volume and dropping prices. The lower sales volume along with inflation in chemicals and energy costs negatively impacted the gross margins in 2017. The gross margins decreased from 11.1% of net sales in 2016 to 9.1% in 2017. The adjusted EBITDA for 2017 stood at $134 million. Net debt reduced by $113 million. Also, the company reported material reduction in overhead costs.

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Also, Verso Corp. released guidance for Q1 2018 and for the full year 2018. The net sales are likely to total around $610-625 million during the first quarter, backed by increased prices. The company also plans capital expenditures amounting to approximately $10 million during the first quarter. For the full year 2018, the company expects higher net sales over the previous year. On the other hand, it foresees significant jump in logistics, energy, raw materials and other input costs. The capital expenditures for the full year are estimated at around $60-70 million, as compared with $40 million in 2017.