International Paper Company (IP) Q3 2022 Earnings Call Transcript

International Paper Company (NYSE:IP) Q3 2022 Earnings Conference Call October 27, 2022 10:00 AM ET

Company Participants

Mark Nelson - Vice President Investor Relations

Mark Sutton - Chairman & Chief Executive Officer

Tim Nicholls - Senior Vice President & Chief Financial Officer

Conference Call Participants

George Staphos - Bank of America

Anthony Pettinari - Citi

Mark Wilde - Bank of Montreal

Mark Weintraub - Seaport Research Partners

Mike Roxland - Truist Securities

Adam Josephson - KeyBanc

Kyle White - Deutsche Bank

Operator

Ladies and gentlemen, good morning and thank you for standing by. Welcome to today's International Paper Third Quarter 2022 Earnings Call. All lines have been placed on mute to prevent background noise. After the speakers' remarks, you'll have an opportunity to ask question [Operator Instructions]. As a reminder today's conference is being recorded.

I'd now like to turn the conference over to Mark Nelson, Vice President Investor Relations. Please go ahead.

Mark Nelson

Thank you, Paul. Good morning and thank you for joining International Paper's third quarter 2022 earnings call. Our speakers this morning are Mark Sutton, Chairman and Chief Executive Officer; and Tim Nicholls, Senior Vice President and Chief Financial Officer. There is important information at the beginning of our presentation on Slide 2, 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. A reconciliation of those figures to US GAAP financial measures is available on our website. Our website also contains copies of our third quarter earnings press release and today's presentation slides.

I will now turn the call over to Mark Sutton.

Mark Sutton

Thank you, Mark and good morning, everyone. We'll begin our discussion on Slide 3. The third quarter was a very dynamic and challenging environment, which had a significant impact on our earnings. We experienced a sharp decline in demand in our Industrial Packaging segment and significantly higher cost headwinds from higher energy and distribution costs.

On a more positive note, I'm very pleased with the progress our Global Cellulose Fibers team is making to improve performance in that business. They are successfully advancing their commercial strategy and achieved cost of capital returns in the third quarter. In both businesses, we also delivered strong price realization. And for the year, we expect to exceed our $225 million target related to our Building a Better IP initiatives.