Mercer International Inc. (NASDAQ:MERC) Q3 2024 Earnings Conference Call November 1, 2024 10:00 AM ET

Company Participants

Richard Short - Chief Financial Officer, Executive Vice President and Secretary
Juan Carlos Bueno - President and Chief Executive Officer

Conference Call Participants

Sean Steuart - TD Cowen
Matthew McKellar - RBC Capital Markets
Cole Hathorn - Jefferies
CJ Baldoni - Principal Global Investors

Operator

Good morning and welcome to Mercer International's Third Quarter 2024 Earnings Conference Call. On the call today is Juan Carlos Bueno, Mercer's President and Chief Executive Officer; and Richard Short, Mercer's Chief Financial Officer and Secretary.

I will now hand the call over to Richard.

Richard Short

Thanks, Josh. Good morning, everyone. Thanks for joining us today. I will begin by touching on the financial and operating highlights of the third quarter before turning the call to Juan Carlos to provide further color into the markets, our operations and our strategic initiatives. Also, for those of you that have joined today's call by telephone, there is presentation material that we have attached to the Investors section of our website.

But before turning to our results, I'd like to remind you that we will be making forward-looking statements in this morning's conference call. According to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, I'd like to call your attention to the risks related to these statements, which are more fully described in our press release and in the company's filings with the Securities and Exchange Commission.

This quarter, our operating EBITDA totaled $50 million, compared to Q2's EBITDA of $30 million. The improved quarter-over-quarter results were driven by fewer days of planned major maintenance downtime as we had 20-days in Q3 compared to 37-days in Q2. The benefit of fewer planned days of downtime in Q3 was partially offset by several unrelated and unplanned events that significantly reduced our pulp production in Q3, as well as unfavorable foreign exchange movements and weaker hardwood prices. Juan Carlos will have more to say about our unplanned downtime in a moment.

Our Pulp segment contributed quarterly EBITDA of $55 million and our Solid Wood segment had quarterly EBITDA of negative $2 million. You can find additional segment disclosures in our Form 10-Q which can be found both on our website and the SEC's. The third quarter is typically a period of weaker seasonal demand, but softwood pulp markets remain steady, resulting in stable prices. Our Q3 softwood pulp sales realizations were $814 per tonne, compared to $811 per tonne in Q2.