o
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
o
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
o
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
o
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
|
|
|
|
PAGE
|
|
Item 2.02.
|
|
|
1
|
|
|
Item 9.01.
|
|
|
1
|
|
|
|
|
|
2
|
|
|
|
|
|
3
|
|
ITEM 2.02.
|
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
|
ITEM 9.01.
|
FINANCIAL STATEMENTS AND EXHIBITS
|
(d)
|
Exhibits.
|
99.1
|
|
|
Press release d
ated July 30, 2014.
|
|
|
RAYONIER ADVANCED MATERIALS INC. (Registrant)
|
|
|
|
BY:
|
|
/s/ BENSON K. WOO
|
|
|
Benson K. Woo
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
EXHIBIT NO.
|
|
DESCRIPTION
|
|
LOCATION
|
99.1
|
|
Press release dated July 30, 2014.
|
|
Furnished herewith
|
|
For Immediate Release
|
News Release
|
Contacts:
|
|
|
Media
|
Russell Schweiss
|
904-357-9158
|
Investors
|
Beth Johnson
|
904-357-9136
|
(millions of dollars, except earnings per share)
|
|
2Q14
|
|
2Q13
|
|
2Q14 YTD
|
|
2Q13 YTD
|
|
||||||||||||||||||||||||
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
||||||||||||||||
Net income
|
|
$
|
5
|
|
|
$
|
0.11
|
|
|
$
|
49
|
|
|
$
|
1.16
|
|
|
$
|
36
|
|
|
$
|
0.84
|
|
|
$
|
129
|
|
|
$
|
3.06
|
|
|
One time separation & legal costs, net
|
25
|
|
|
0.59
|
|
|
2
|
|
|
0.05
|
|
|
27
|
|
|
0.64
|
|
|
2
|
|
|
0.05
|
|
|
|||||||||
Reversal of reserve related to the taxability of the CBPC
|
|
(5
|
)
|
|
(0.11
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
(0.11
|
)
|
|
—
|
|
|
—
|
|
|
||||||||
Tax benefit due to exchange of AFMC for CBPC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
(0.45
|
)
|
|
||||||||
Pro forma net income
|
|
$
|
25
|
|
|
$
|
0.59
|
|
|
$
|
51
|
|
|
$
|
1.21
|
|
|
$
|
58
|
|
|
$
|
1.37
|
|
|
$
|
112
|
|
|
$
|
2.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
EBITDA
|
|
$
|
24
|
|
|
|
|
$
|
85
|
|
|
|
|
$
|
88
|
|
|
|
|
$
|
188
|
|
|
|
|
||||||||
One time separation & legal costs
|
36
|
|
|
|
|
3
|
|
|
|
|
39
|
|
|
|
|
3
|
|
|
|
|
|||||||||||||
Pro forma EBITDA
|
|
$
|
60
|
|
|
|
|
$
|
88
|
|
|
|
|
$
|
127
|
|
|
|
|
$
|
191
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||
|
June 28,
|
|
March 31,
|
|
June 30,
|
|
June 28,
|
|
June 30,
|
||||||||||
|
2014
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||
NET SALES
|
|
|
|
|
|
|
|
|
|
||||||||||
Cellulose specialties
|
200.7
|
|
|
206.4
|
|
|
233.1
|
|
|
407.1
|
|
|
480.0
|
|
|||||
Absorbent materials
|
0.2
|
|
|
10.2
|
|
|
19.9
|
|
|
10.4
|
|
|
57.2
|
|
|||||
Commodity viscose and other
|
11.6
|
|
|
26.9
|
|
|
1.2
|
|
|
38.5
|
|
|
2.2
|
|
|||||
Total net sales
|
$
|
212.5
|
|
|
$
|
243.5
|
|
|
$
|
254.2
|
|
|
$
|
456.0
|
|
|
$
|
539.4
|
|
COST OF SALES
|
160.2
|
|
|
188.7
|
|
|
169.8
|
|
|
348.9
|
|
|
357.7
|
|
|||||
GROSS MARGIN
|
52.3
|
|
|
54.8
|
|
|
84.4
|
|
|
107.1
|
|
|
181.7
|
|
|||||
Selling and general expenses
|
9.0
|
|
|
8.2
|
|
|
9.1
|
|
|
17.2
|
|
|
18.7
|
|
|||||
Other operating expense (a)
|
37.1
|
|
|
3.2
|
|
|
3.7
|
|
|
40.3
|
|
|
4.0
|
|
|||||
OPERATING INCOME
|
6.2
|
|
|
43.4
|
|
|
71.6
|
|
|
49.6
|
|
|
159.0
|
|
|||||
Interest expense
|
(3.2
|
)
|
|
—
|
|
|
—
|
|
|
(3.3
|
)
|
|
—
|
|
|||||
INCOME BEFORE INCOME TAXES
|
3.0
|
|
|
43.4
|
|
|
71.6
|
|
|
46.3
|
|
|
159.0
|
|
|||||
Income tax benefit (expense) (b)
|
1.6
|
|
|
(12.4
|
)
|
|
(22.6
|
)
|
|
(10.8
|
)
|
|
(30.0
|
)
|
|||||
NET INCOME
|
4.6
|
|
|
31.0
|
|
|
49.0
|
|
|
35.5
|
|
|
129.0
|
|
|||||
EARNINGS PER COMMON SHARE
|
|
|
|
|
|
|
|
|
|
||||||||||
BASIC EARNINGS PER SHARE
|
$
|
0.11
|
|
|
$
|
0.73
|
|
|
$
|
1.16
|
|
|
$
|
0.84
|
|
|
$
|
3.06
|
|
DILUTED EARNINGS PER SHARE
|
$
|
0.11
|
|
|
$
|
0.73
|
|
|
$
|
1.16
|
|
|
$
|
0.84
|
|
|
$
|
3.06
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Pro forma net income per share (c)
|
$
|
0.59
|
|
|
$
|
0.78
|
|
|
$
|
1.21
|
|
|
$
|
1.37
|
|
|
$
|
2.66
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted Average Common
|
|
|
|
|
|
|
|
|
|
||||||||||
Shares used for determining
(d)
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic EPS
|
42,176,565
|
|
|
42,176,565
|
|
|
42,176,565
|
|
|
42,176,565
|
|
|
42,176,565
|
|
|||||
Diluted EPS
|
42,178,462
|
|
|
42,176,565
|
|
|
42,176,565
|
|
|
42,177,503
|
|
|
42,176,565
|
|
(d)
|
On June 27, 2014, 42,176,565 shares of our common stock were distributed to Rayonier Inc. stockholders in conjunction with the separation. For comparative purposes, we have assumed this amount to be outstanding as of the beginning of each period prior to the separation in the calculation of Basic Earnings Per Share.
|
|
|
|||||||
|
|
June 28,
|
|
December 31,
|
||||
|
|
2014
|
|
2013
|
||||
Assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
19.6
|
|
|
$
|
—
|
|
Other current assets
|
|
245.3
|
|
|
246.1
|
|
||
Property, plant and equipment, net
|
|
857.6
|
|
|
846.3
|
|
||
Other assets
|
|
102.5
|
|
|
27.9
|
|
||
|
|
$
|
1,225.0
|
|
|
$
|
1,120.3
|
|
Liabilities and Stockholders' (Deficit) Equity
|
|
|
|
|
||||
Current maturities of long-term debt
|
|
$
|
8.4
|
|
|
$
|
—
|
|
Other current liabilities
|
|
120.2
|
|
|
79.8
|
|
||
Long-term debt
|
|
940.5
|
|
|
—
|
|
||
Non-current liabilities for disposed operations
|
|
84.9
|
|
|
—
|
|
||
Other non-current liabilities
|
|
109.8
|
|
|
72.2
|
|
||
Total stockholders' (deficit) equity
|
|
(38.8
|
)
|
|
968.3
|
|
||
|
|
$
|
1,225.0
|
|
|
$
|
1,120.3
|
|
|
|
|
||||||
|
|
Six Months Ended
|
||||||
|
|
June 28, 2014
|
|
June 30, 2013
|
||||
Cash provided by operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
35.5
|
|
|
$
|
129.0
|
|
Depreciation and amortization
|
|
38.2
|
|
|
28.8
|
|
||
Other items to reconcile net income to cash provided by operating activities
|
|
30.4
|
|
|
(46.5
|
)
|
||
Changes in working capital and other assets and liabilities
|
|
(1.1
|
)
|
|
4.9
|
|
||
|
|
103.0
|
|
|
116.2
|
|
||
Cash used for investing activities:
|
|
|
|
|
||||
Capital expenditures
|
|
(50.7
|
)
|
|
(70.2
|
)
|
||
Jesup plant cellulose specialties expansion
|
|
—
|
|
|
(100.2
|
)
|
||
Other
|
|
(13.2
|
)
|
|
18.9
|
|
||
|
|
(63.9
|
)
|
|
(151.5
|
)
|
||
Cash (used for) provided by financing activities:
|
|
|
|
|
||||
Changes in debt, net of issuance costs
|
|
937.1
|
|
|
—
|
|
||
Net payments from (to) Parent
|
|
(956.6
|
)
|
|
35.3
|
|
||
|
|
(19.5
|
)
|
|
35.3
|
|
||
Cash and cash equivalents:
|
|
|
|
|
||||
Change in cash and cash equivalents
|
|
19.6
|
|
|
—
|
|
||
Balance, beginning of year
|
|
—
|
|
|
—
|
|
||
Balance, end of period
|
|
$
|
19.6
|
|
|
$
|
—
|
|
EBITDA (a):
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 28, 2014
|
|
June 30, 2013
|
|
June 28, 2014
|
|
June 30, 2013
|
||||||||
Net income
|
|
$
|
4.6
|
|
|
$
|
49.0
|
|
|
$
|
35.5
|
|
|
$
|
129.0
|
|
Depreciation and amortization
|
|
17.5
|
|
|
13.7
|
|
|
38.2
|
|
|
28.8
|
|
||||
Interest, net
|
|
3.2
|
|
|
—
|
|
|
3.3
|
|
|
—
|
|
||||
Income tax (benefit) expense
|
|
(1.6
|
)
|
|
22.6
|
|
|
10.8
|
|
|
30.0
|
|
||||
EBITDA
|
|
$
|
23.7
|
|
|
$
|
85.3
|
|
|
$
|
87.8
|
|
|
$
|
187.8
|
|
|
|
|
|
|
|
|
|
|
||||||||
One-time separation and legal costs
|
|
36.3
|
|
|
3.0
|
|
|
39.1
|
|
|
3.0
|
|
||||
Pro forma EBITDA
|
|
$
|
60.0
|
|
|
$
|
88.3
|
|
|
$
|
126.9
|
|
|
$
|
190.8
|
|
ADJUSTED FREE CASH FLOW (b):
|
|
|
|
|
||||
|
|
Six Months Ended
|
||||||
|
|
June 28, 2014
|
|
June 30, 2013
|
||||
Cash provided by operating activities
|
|
$
|
103.0
|
|
|
$
|
116.2
|
|
Capital expenditures (c)
|
|
(50.7
|
)
|
|
(70.2
|
)
|
||
Tax benefit due to exchange of AFMC for CBPC
|
|
—
|
|
|
(19.0
|
)
|
||
Adjusted Free Cash Flow
|
|
$
|
52.3
|
|
|
$
|
27.0
|
|
PRO FORMA OPERATING INCOME AND NET INCOME (d):
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||||||||||||||||||||||
|
June 28, 2014
|
|
March 31, 2014
|
|
June 30, 2013
|
|
June 28, 2014
|
|
June 30, 2013
|
||||||||||||||||||||||||||||||
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
|
$
|
|
Per Diluted Share
|
||||||||||||||||||||
Operating income
|
$
|
6.2
|
|
|
|
|
|
$
|
43.4
|
|
|
|
|
$
|
71.6
|
|
|
|
|
$
|
49.6
|
|
|
|
|
$
|
159.0
|
|
|
|
|||||||||
One-time separation and legal costs
|
36.3
|
|
|
|
|
|
2.8
|
|
|
|
|
3.0
|
|
|
|
|
39.1
|
|
|
|
|
3.0
|
|
|
|
||||||||||||||
Pro forma operating income
|
$
|
42.5
|
|
|
|
|
|
$
|
46.2
|
|
|
|
|
$
|
74.6
|
|
|
|
|
$
|
88.7
|
|
|
|
|
$
|
162.0
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Net income
|
$
|
4.6
|
|
|
$
|
0.11
|
|
|
$
|
31.0
|
|
|
$
|
0.73
|
|
|
$
|
49.0
|
|
|
$
|
1.16
|
|
|
$
|
35.5
|
|
|
$
|
0.84
|
|
|
$
|
129.0
|
|
|
$
|
3.06
|
|
One-time separation and legal costs, net of tax
|
25.0
|
|
|
0.59
|
|
|
2.0
|
|
|
0.05
|
|
|
1.9
|
|
|
0.05
|
|
|
27.0
|
|
|
0.64
|
|
|
1.9
|
|
|
0.05
|
|
||||||||||
Reversal of reserve related to the taxability of the CBPC
|
(4.8
|
)
|
|
(0.11
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4.8
|
)
|
|
(0.11
|
)
|
|
—
|
|
|
—
|
|
||||||||||
Tax benefit due to exchange of AFMC for CBPC
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19.0
|
)
|
|
(0.45
|
)
|
||||||||||
Pro forma net income
|
$
|
24.8
|
|
|
$
|
0.59
|
|
|
$
|
33.0
|
|
|
$
|
0.78
|
|
|
$
|
50.9
|
|
|
$
|
1.21
|
|
|
$
|
57.7
|
|
|
$
|
1.37
|
|
|
$
|
111.9
|
|
|
$
|
2.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|