MERC Mercer International Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 9, 2024

MERCER INTERNATIONAL INC.

(Exact name of Registrant as Specified in Its Charter)

Washington	000-51826	47-0956945
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Suite 1120, 700 West Pender Street, Vancouver, British Columbia, Canada, V6C 1G8

(Address of Principal Executive Offices)

Registrant’s Telephone Number, Including Area Code: (604) 684-1099

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $1.00 per share		MERC		NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

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Item 2.02. Results of Operations and Financial Condition

The information furnished under Item 2.02 of this Current Report shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On May 9, 2024, Mercer International Inc. (the “Company”) announced by press release the Company’s results for its first quarter ended March 31, 2024. A copy of such press release is furnished as Exhibit 99.1 to this Current Report.

Item 8.01. Other Events

On May 9, 2024, the Company announced by press release that its board of directors had authorized a quarterly cash dividend of $0.075 per share to be paid on July 3, 2024 to all shareholders of record on June 26, 2024. A copy of such press release is furnished as Exhibit 99.1 to this Current Report.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

 

Exhibit Number		Description
99.1		Press Release dated May 9, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	MERCER INTERNATIONAL INC.
Date: May 9, 2024	By:		/s/ Richard Short
			Richard Short
			Chief Financial Officer

 

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EXHIBIT 99.1

 

 

 

 

For Immediate Release

MERCER INTERNATIONAL INC. REPORTS FIRST QUARTER 2024 RESULTS AND ANNOUNCES QUARTERLY CASH DIVIDEND OF $0.075

 

Selected Highlights

 

NEW YORK, NY, May 9, 2024 ‑ Mercer International Inc. (Nasdaq: MERC) today reported first quarter 2024 Operating EBITDA of $63.6 million, an increase from $27.5 million in the same quarter of 2023 and $21.1 million in the fourth quarter of 2023.

 

In the first quarter of 2024, net loss was $16.7 million (or $0.25 per share), which included a non-cash loss on disposal of $23.6 million (or $0.35 per share) relating to the dissolution of the Cariboo Pulp and Paper ("CPP") joint venture, compared to a net loss of $30.6 million (or $0.46 per share) in the first quarter of 2023 and a net loss of $87.2 million (or $1.31 per share) in the fourth quarter of 2023, which included a non-cash impairment charge of $33.7 million (or $0.51 per share) relating to the classification of our sandalwood business as held for sale.

 

Mr. Juan Carlos Bueno, Chief Executive Officer, stated: "In the first quarter, our operating results were
positively impacted by an improved pulp and lumber pricing environment, lower fiber and other production costs and no planned maintenance downtime.

 

NBSK pulp prices in Europe and North America continued to improve in the first quarter, driven by stronger demand, lower customer inventory levels and global supply disruptions. In China, third party industry quoted NBSK net

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prices were flat, with weaker demand around the Chinese New Year offset by stronger demand towards the end of the quarter. We believe this positive pricing momentum will continue and expect modest price increases in the second quarter of 2024.

 

Lumber pricing in both the U.S. and Europe also improved in the first quarter of 2024 as a result of a modest increase in demand. However, we currently expect lumber prices to be generally flat in the second quarter as demand continues to be impacted by high interest rates and economic uncertainty.

 

In the first quarter, we continued our focus on our strategic priorities. To this end, in April 2024, we announced the dissolution of the CPP joint venture, which will allow us to direct resources to areas aligned with our long-term focus.

 

In the first quarter of 2024, all our pulp mills ran very efficiently with no scheduled maintenance downtime. We are currently planning for a total of 35 days of maintenance downtime (approximately 60,800 ADMTs) at our pulp mills in the second quarter of 2024.

 

Overall per unit fiber costs for our pulp segment decreased in the first quarter of 2024 compared to the fourth quarter of 2023 due to stable supply. Per unit fiber costs for our solid wood segment increased compared to the prior quarter due to strong demand for sawlogs.

 

We continue to maintain a healthy order book for our growing mass timber business and commenced work on certain large-scale projects in the second quarter."

 

Mr. Bueno concluded: "Overall, conditions continued to improve in the first quarter, including better pricing and lower production costs for our pulp segment. While we expect this momentum to continue in the second quarter of 2024, we remain steadfast in managing our costs and liquidity prudently. As a result of our strong liquidity, we believe we are well positioned to execute our business plan through the business cycle."

Current Market Environment

We currently expect pulp pricing to continue to improve in the second quarter of 2024, led by Europe and North America as a result of stronger demand and global supply constraints. In China, we currently expect stable prices in the second quarter of 2024.

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In our solid wood segment, we currently expect stable U.S. and European lumber prices in the second quarter of 2024 as demand remains weak due to continued high interest rates and economic uncertainty. We currently expect mass timber prices to remain generally stable in the second quarter of 2024 as a result of steady demand.

Consolidated Financial Results

	Q1				Q4				Q1
	2024				2023				2023
	(in thousands, except per share amounts)
Revenues	$	553,430			$	470,494			$	522,666
Operating loss	$	(448	)		$	(56,395	)		$	(20,121	)
Operating EBITDA	$	63,601			$	21,145			$	27,470
Net loss	$	(16,703	)		$	(87,216	)		$	(30,578	)
Net loss per common share
Basic	$	(0.25	)		$	(1.31	)		$	(0.46	)
Diluted	$	(0.25	)		$	(1.31	)		$	(0.46	)

Consolidated – Three Months Ended March 31, 2024 Compared to Three Months Ended March 31, 2023

Total revenues for the first quarter of 2024 increased by approximately 6% to $553.4 million from $522.7 million in the same quarter of 2023 primarily due to higher pulp sales volumes partially offset by lower pulp sales realizations.

Costs and expenses in the first quarter of 2024 modestly increased to $553.9 million from $542.8 million in the same quarter of 2023 primarily as a result of higher pulp sales volumes and the non-cash loss on disposal of the CPP joint venture investment partially offset by lower per unit fiber, chemical, energy and freight costs.

In the first quarter of 2024, Operating EBITDA increased to $63.6 million from $27.5 million in the same quarter of 2023 primarily due to lower per unit fiber and other production costs, lower freight costs and higher pulp sales volumes partially offset by lower pulp sales realizations.

Segment Results

Pulp

	Three Months Ended March 31,
	2024				2023
	(in thousands)
Pulp revenues	$	408,295			$	369,656
Energy and chemical revenues	$	24,109			$	30,745
Operating income	$	17,447			$	12,771

In the first quarter of 2024, our pulp segment operating income increased by approximately 36% to $17.4 million from $12.8 million in the same quarter of 2023 primarily as a result of lower per unit fiber and other production costs, lower freight costs and higher sales volumes partially offset by lower sales realizations and the non-cash loss on disposal of the CPP joint venture investment.

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Pulp segment revenues, which includes pulp, energy and chemical revenues, in the first quarter of 2024 increased by approximately 8% to $432.4 million from $400.4 million in the same quarter of 2023 due to higher sales volumes partially offset by lower sales realizations.

In the first quarter of 2024, third party industry quoted average list prices for NBSK pulp modestly increased in Europe and decreased in North America from the same quarter of 2023. Third party industry quoted average net prices for NBSK pulp in China decreased from the same quarter of 2023. Our average NBSK pulp sales realizations in the first quarter of 2024 decreased by approximately 14% to $732 per ADMT from $849 per ADMT in the same quarter of 2023. In the first quarter of 2024, average NBHK pulp sales realizations decreased by approximately 22% to $631 per ADMT from $809 per ADMT in the same quarter of 2023.

Total pulp sales volumes in the first quarter of 2024 increased by approximately 30% to 565,664 ADMTs from 435,973 ADMTs in the same quarter of 2023 primarily because of the sales timing and higher production.

Energy and chemical revenues in the first quarter of 2024 decreased by approximately 21% to $24.1 million from $30.7 million in the same quarter of 2023 due to lower sales realizations partially offset by higher sales volumes.

Costs and expenses in the first quarter of 2024 increased by approximately 7% to $416.5 million from $388.0 million in the first quarter of 2023 primarily due to higher pulp sales volumes and the non-cash loss on disposal of the CPP joint venture investment partially offset by lower per unit fiber, chemical, energy and freight costs.

On average, in the first quarter of 2024, overall per unit fiber costs decreased by approximately 16% from the same quarter of 2023 due to lower per unit fiber costs at all our pulp mills as a result of stable supply. We currently expect per unit fiber costs to decrease in the second quarter of 2024 as a result of continued stable supply.

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Solid Wood

	Three Months Ended March 31,
	2024				2023
	(in thousands)
Lumber revenues	$	55,882			$	60,039
Energy revenues	$	4,838			$	5,695
Manufactured products revenues(1)	$	16,713			$	5,804
Pallet revenues	$	28,020			$	36,175
Biofuels revenues(2)	$	11,254			$	8,135
Wood residuals revenues	$	2,316			$	5,166
Operating loss	$	(13,706	)		$	(27,069	)

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In the first quarter of 2024, our solid wood segment had an operating loss of $13.7 million compared to $27.1 million in the same quarter of 2023 primarily because of lower per unit energy, fiber and freight costs partially offset by lower pallet sales realizations.

Solid wood segment revenues in the first quarter of 2024 modestly decreased to $119.0 million from $121.0 million in the same quarter of 2023 as higher manufactured products and biofuel revenues were more than offset by lower revenues from other products.

Lumber revenues in the first quarter of 2024 decreased by approximately 7% to $55.9 million from $60.0 million in the same quarter of 2023 primarily due to lower sales volumes partially offset by higher sales realizations. Average lumber sales realizations in the first quarter of 2024 increased by approximately 7% to $460 per Mfbm from $429 per Mfbm in the same quarter of 2023 driven by stronger demand in the U.S. market. The U.S. market accounted for approximately 53% of our lumber revenues and approximately 43% of our lumber sales volumes in the first quarter of 2024. The majority of the balance of our lumber sales were to Europe.

Lumber sales volumes in the first quarter of 2024 decreased by approximately 13% to 121.4 MMfbm from 139.9 MMfbm in the same quarter of 2023 primarily due to lower production and sales timing.

In the first quarter of 2024, our mass timber business continued to ramp up operations and manufactured products revenues more than doubled to $16.7 million from $5.8 million in the same quarter of 2023. Manufactured products sales realizations increased to $3,644 per cubic meters in the first quarter of 2024 from $666 per cubic meters in the same quarter of 2023 as a result of higher CLT and glulam sales volumes, which generate higher sales realizations relative to other manufactured products.

 

 

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Energy, biofuels and wood residuals revenues in the first quarter of 2024 modestly decreased to $18.4 million from $19.0 million in the same quarter of 2023 as a result of lower sales realizations partially offset by higher biofuel sales volumes.

Pallet revenues in the first quarter of 2024 decreased by approximately 23% to $28.0 million from $36.2 million in the same quarter of 2023 due to lower sales realizations and sales volumes as weak economic conditions in Europe negatively impacted demand.

Lumber production in the first quarter of 2024 decreased by approximately 5% to 127.0 MMfbm from 134.0 MMfbm in the same quarter of 2023 due to weak demand.

Fiber costs were approximately 75% of our lumber cash production costs in the first quarter of 2024. In the first quarter of 2024, per unit fiber costs for lumber production decreased by approximately 11% compared to the same quarter of 2023 because of continued stable supply. We currently expect modestly higher per unit fiber costs in the second quarter of 2024 driven by continued strong demand.

Liquidity

As of March 31, 2024, we had cash and cash equivalents of $274.3 million, approximately $280.6 million available under our revolving credit facilities and aggregate liquidity of about $554.9 million.

The following table is a summary of selected financial information as of the dates indicated:

	March 31,				December 31,
	2024				2023
	(in thousands)
Cash and cash equivalents	$	274,272			$	313,992
Working capital	$	825,364			$	806,468
Total assets	$	2,605,355			$	2,662,578
Long-term liabilities	$	1,730,178			$	1,740,731
Total shareholders' equity	$	573,639			$	635,410

Quarterly Dividend

A quarterly dividend of $0.075 per share will be paid on July 3, 2024 to all shareholders of record on June 26, 2024. Future dividends will be subject to Board approval and may be adjusted as business and industry conditions warrant.

Earnings Release Call

In conjunction with this release, Mercer International Inc. will host a conference call, which will be simultaneously broadcast live over the Internet. Management will host the call, which is scheduled for May 10, 2024 at 10:00 AM ET. Listeners can access the conference call live and archived for 30 days over the Internet at

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https://edge.media-server.com/mmc/p/tdezetkf or through a link on the company's home page at https://www.mercerint.com. Please allow 15 minutes prior to the call to visit the website and download and install any necessary audio software.

Mercer International Inc. is a global forest products company with operations in Germany, USA and Canada with consolidated annual production capacity of 2.1 million tonnes of pulp, 960 million board feet of lumber, 210 thousand cubic meters of CLT, 45 thousand cubic meters of glulam, 17 million pallets and 230,000 metric tonnes of biofuels. To obtain further information on the company, please visit its website at https://www.mercerint.com.

The preceding includes forward looking statements which involve known and unknown risks and uncertainties which may cause our actual results in future periods to differ materially from forecasted results. Words such as "expects", "anticipates", "are optimistic that", "projects", "intends", "designed", "will", "believes", "estimates", "may", "could" and variations of such words and similar expressions are intended to identify such forward-looking statements. Among those factors which could cause actual results to differ materially are the following: the highly cyclical nature of our business, raw material costs, our level of indebtedness, competition, foreign exchange and interest rate fluctuations, our use of derivatives, expenditures for capital projects, environmental regulation and compliance, disruptions to our production, market conditions and other risk factors listed from time to time in our SEC reports.

APPROVED BY:

William D. McCartney

Interim Chairman

(604) 684-1099

 

Juan Carlos Bueno

Chief Executive Officer

(604) 684-1099

 

-FINANCIAL TABLES FOLLOW-

 

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Summary Financial Highlights

	Q1				Q4				Q1
	2024				2023				2023
	(in thousands, except per share amounts)
Pulp segment revenues	$	432,404			$	364,182			$	400,401
Solid wood segment revenues		119,023				105,443				121,014
Corporate and other revenues		2,003				869				1,251
Total revenues	$	553,430			$	470,494			$	522,666
Pulp segment operating income	$	17,447			$	1,245			$	12,771
Solid wood segment operating loss		(13,706	)			(18,411	)			(27,069	)
Corporate and other operating loss		(4,189	)			(39,229	)			(5,823	)
Total operating loss	$	(448	)		$	(56,395	)		$	(20,121	)
Pulp segment depreciation and amortization	$	27,373			$	30,783			$	27,399
Solid wood segment depreciation and amortization		12,811				12,779				19,898
Corporate and other depreciation and amortization		220				244				294
Total depreciation and amortization	$	40,404			$	43,806			$	47,591
Operating EBITDA	$	63,601			$	21,145			$	27,470
Loss on disposal of investment in joint venture	$	23,645			$	—			$	—
Impairment of sandalwood business held for sale	$	—			$	33,734			$	—
Income tax recovery (provision)	$	6,365			$	(1,084	)		$	5,356
Net loss	$	(16,703	)		$	(87,216	)		$	(30,578	)
Net loss per common share
Basic	$	(0.25	)		$	(1.31	)		$	(0.46	)
Diluted	$	(0.25	)		$	(1.31	)		$	(0.46	)
Common shares outstanding at period end		66,850				66,525				66,421

 

 

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Summary Operating Highlights

	Q1				Q4				Q1
	2024				2023				2023
Pulp Segment
Pulp production ('000 ADMTs)
NBSK		453.2				436.2				430.0
NBHK		85.7				71.5				72.3
Annual maintenance downtime ('000 ADMTs)		—				31.6				13.5
Annual maintenance downtime (days)		—				23				10
Pulp sales ('000 ADMTs)
NBSK		488.2				411.8				378.6
NBHK		77.5				79.4				57.4
Average NBSK pulp prices ($/ADMT)(1)
Europe		1,400				1,245				1,377
China		745				748				891
North America		1,440				1,312				1,675
Average NBHK pulp prices ($/ADMT)(1)
China		662				643				710
North America		1,223				1,083				1,523
Average pulp sales realizations ($/ADMT)(2)
NBSK		732				709				849
NBHK		631				593				809
Energy production ('000 MWh)(3)		576.4				544.6				534.6
Energy sales ('000 MWh)(3)		220.6				213.2				196.9
Average energy sales realizations ($/MWh)(3)		88				92				128
Solid Wood Segment
Lumber
Production (MMfbm)		127.0				111.6				134.0
Sales (MMfbm)		121.4				112.0				139.9
Average sales realizations ($/Mfbm)		460				427				429
Energy
Production and sales ('000 MWh)		38.7				38.7				40.5
Average sales realizations ($/MWh)		125				127				141
Manufactured products(4)
Production ('000 cubic meters)		7.2				10.2				0.8
Sales ('000 cubic meters)		4.0				12.1				4.3
Average sales realizations ($/cubic meters)		3,644				1,234				666
Pallets
Production ('000 units)		3,056.3				2,184.7				2,880.2
Sales ('000 units)		2,916.3				2,450.7				2,942.4
Average sales realizations ($/unit)		10				10				12
Biofuels(5)
Production ('000 tonnes)		37.9				38.9				32.6
Sales ('000 tonnes)		48.2				39.9				25.8
Average sales realizations ($/tonne)		234				274				315
Average Spot Currency Exchange Rates
$ / €(6)		1.0855				1.0761				1.0730
$ / C$(6)		0.7415				0.7347				0.7393

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MERCER INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

 

	Three Months Ended March 31,
	2024				2023
Revenues	$	553,430			$	522,666
Costs and expenses
Cost of sales, excluding depreciation and amortization		458,182				461,338
Cost of sales depreciation and amortization		40,350				47,498
Selling, general and administrative expenses		31,701				33,951
Loss on disposal of investment in joint venture		23,645				—
Operating loss		(448	)			(20,121	)
Other income (expenses)
Interest expense		(27,559	)			(19,047	)
Other income		4,939				3,234
Total other expenses, net		(22,620	)			(15,813	)
Loss before income taxes		(23,068	)			(35,934	)
Income tax recovery		6,365				5,356
Net loss	$	(16,703	)		$	(30,578	)
Net loss per common share
Basic	$	(0.25	)		$	(0.46	)
Diluted	$	(0.25	)		$	(0.46	)
Dividends declared per common share	$	0.075			$	0.075

 

 

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MERCER INTERNATIONAL INC.

INTERIM CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share and per share data)

 

		March 31,				December 31,
		2024				2023
ASSETS
Current assets
Cash and cash equivalents		$	274,272			$	313,992
Accounts receivable, net			368,466				306,166
Inventories			408,326				414,161
Prepaid expenses and other			42,241				23,461
Assets classified as held for sale			33,597				35,125
Total current assets			1,126,902				1,092,905
Property, plant and equipment, net			1,361,975				1,409,937
Investment in joint ventures			4,455				41,665
Amortizable intangible assets, net			51,113				52,641
Goodwill			34,616				35,381
Operating lease right-of-use assets			10,623				11,725
Pension asset			5,513				5,588
Other long-term assets			10,158				12,736
Total assets		$	2,605,355			$	2,662,578
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and other		$	294,289			$	278,986
Pension and other post-retirement benefit obligations			806				826
Liabilities associated with assets held for sale			6,443				6,625
Total current liabilities			301,538				286,437
Long-term debt			1,615,173				1,609,425
Pension and other post-retirement benefit obligations			12,349				12,483
Operating lease liabilities			6,797				7,755
Other long-term liabilities			13,448				13,744
Deferred income tax			82,411				97,324
Total liabilities			2,031,716				2,027,168
Shareholders’ equity
Common shares $1 par value; 200,000,000 authorized; 66,850,000 issued and outstanding (2023 – 66,525,000)			66,796				66,471
Additional paid-in capital			360,941				359,497
Retained earnings			314,396				336,113
Accumulated other comprehensive loss			(168,494	)			(126,671	)
Total shareholders’ equity			573,639				635,410
Total liabilities and shareholders’ equity		$	2,605,355			$	2,662,578

 

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MERCER INTERNATIONAL INC.

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

		Three Months Ended March 31,
		2024				2023
Cash flows from (used in) operating activities
Net loss		$	(16,703	)		$	(30,578	)
Adjustments to reconcile net loss to cash flows from operating activities
Depreciation and amortization			40,404				47,591
Deferred income tax recovery			(13,426	)			(9,944	)
Inventory impairment			—				15,200
Loss on disposal of investment in joint venture			23,645				—
Defined benefit pension plans and other post-retirement benefit plan expense			210				446
Stock compensation expense			2,029				1,226
Foreign exchange transaction losses (gains)			(3,449	)			270
Other			727				(1,149	)
Defined benefit pension plans and other post-retirement benefit plan contributions			(329	)			(247	)
Changes in working capital
Accounts receivable			(63,729	)			11,342
Inventories			89				(86,434	)
Accounts payable and accrued expenses			2,390				309
Other			(1,052	)			2,318
Net cash from (used in) operating activities			(29,194	)			(49,650	)
Cash flows from (used in) investing activities
Purchase of property, plant and equipment			(18,461	)			(33,429	)
Proceeds from government grants			787				—
Other			190				805
Net cash from (used in) investing activities			(17,484	)			(32,624	)
Cash flows from (used in) financing activities
Proceeds from revolving credit facilities, net			9,125				30,102
Payment of finance lease obligations			(2,189	)			(1,889	)
Other			(115	)			(114	)
Net cash from (used in) financing activities			6,821				28,099
Effect of exchange rate changes on cash and cash equivalents			137				703
Net decrease in cash and cash equivalents			(39,720	)			(53,472	)
Cash and cash equivalents, beginning of period			313,992				354,032
Cash and cash equivalents, end of period		$	274,272			$	300,560

 

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MERCER INTERNATIONAL INC.

COMPUTATION OF OPERATING EBITDA

(Unaudited)

(In thousands)

 

Operating EBITDA is defined as operating loss plus depreciation and amortization and non-recurring capital asset impairment charges. Management uses Operating EBITDA as a benchmark measurement of its own operating results, and as a benchmark relative to its competitors. Management considers it to be a meaningful supplement to operating loss as a performance measure primarily because depreciation expense and non-recurring capital asset impairment charges are not an actual cash cost, and depreciation expense varies widely from company to company in a manner that management considers largely independent of the underlying cost efficiency of our operating facilities. In addition, management believes Operating EBITDA is commonly used by securities analysts, investors and other interested parties to evaluate our financial performance.

 

Operating EBITDA does not reflect the impact of a number of items that affect our net loss, including financing costs and the effect of derivative instruments. Operating EBITDA is not a measure of financial performance under GAAP, and should not be considered as an alternative to net loss or operating loss as a measure of performance, nor as an alternative to net cash from (used in) operating activities as a measure of liquidity. Operating EBITDA is an internal measure and therefore may not be comparable to other companies.

 

The following table sets forth a reconciliation of net loss to Operating EBITDA for the periods indicated:

 

	Q1				Q4				Q1
	2024				2023				2023
Net loss	$	(16,703	)		$	(87,216	)		$	(30,578	)
Income tax provision (recovery)		(6,365	)			1,084				(5,356	)
Interest expense		27,559				27,245				19,047
Other expenses (income)		(4,939	)			2,492				(3,234	)
Operating loss		(448	)			(56,395	)			(20,121	)
Add: Depreciation and amortization		40,404				43,806				47,591
Add: Loss on disposal of investment in joint venture		23,645				—				—
Add: Impairment of sandalwood business held for sale		—				33,734				—
Operating EBITDA	$	63,601			$	21,145			$	27,470

 

 

 

 

 

 

 

 

 

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v3.24.1.u1

Document and Entity Information	May 09, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 09, 2024
Entity Registrant Name	MERCER INTERNATIONAL INC.
Entity Central Index Key	0001333274
Entity File Number	000-51826
Entity Tax Identification Number	47-0956945
Entity Incorporation, State or Country Code	WA
Entity Emerging Growth Company	false
Entity Address, Address Line One	Suite 1120
Entity Address, Address Line Two	700 West Pender Street
Entity Address, City or Town	Vancouver
Entity Address, State or Province	BC
Entity Address, Country	CA
Entity Address, Postal Zip Code	V6C 1G8
City Area Code	(604)
Local Phone Number	684-1099
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $1.00 per share
Trading Symbol	MERC
Security Exchange Name	NASDAQ

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