Domtar Corp (UFS) 10-Q Quarterly Report May 2021

Domtar Corporation (NYSE: UFS) (TSX: UFS) today reported a net loss of $29 million ($0.54 per share) for the first quarter of 2021 compared to a net loss of $59 million ($1.07 per share) for the fourth quarter of 2020 and net earnings of $5 million ($0.09 per share) for the first quarter of 2020. Sales for the first quarter of 2021 were $944 million.

The first quarter 2021 results include an after-tax loss of $22 million ($0.41 per share) from discontinued operations related to the sale of the Personal Care Business, compared to an after-tax loss of $43 million ($0.78 per share) for the fourth quarter of 2020 and an after-tax earnings of $20 million ($0.36 per share) for the first quarter of 2020.

Excluding discontinued operations and the items listed below, the Company had earnings from continuing operations before items¹ of $5 million ($0.09 per share) for the first quarter of 2021 compared to earnings from continuing operations before items¹ of $19 million ($0.34 per share) for the fourth quarter of 2020 and a loss from continuing operations before items¹ of $15 million ($0.27 per share) for the first quarter of 2020.

ITEMS

¹	Non-GAAP financial measure. Refer to the Reconciliation of Non-GAAP Financial Measures in the appendix.

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The following information was filed by Domtar Corp (UFS) on Thursday, May 6, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Domtar Corp's 10-Q Quarterly Report:

M & A - Other Highlight
The Credit Agreement contains customary covenants and events of default for transactions of this type, including two financial covenants: (i) an interest coverage ratio, as defined in the Credit Agreement, that must be maintained at a level of not less than 3 to 1 and (ii) a leverage ratio, as defined in the Credit Agreement, that must be maintained at a level of not greater than 3.75 to 1 (or 4.00 to 1 upon the occurrence of certain qualifying material acquisitions).

Financial - Expense Highlight
This increase was mostly due to higher SG&A expenses as a result of greater variable compensation in the first quarter of 2021 when compared to the first quarter of 2020 as well as $1 million of restructuring charges in the first quarter of 2021 related to severance and termination costs under Closure and restructuring costs.
Other - Other Highlight
In the first quarter of 2020, we increased our net proceeds from borrowings under our credit facilities (revolver and receivables securitization) ($165 million).
Financial - Expense Highlight
For the three months ended March 31, 2021, we recorded $6 million of accelerated depreciation under Impairment of long-lived assets, and $3 million of severance and termination costs under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).
Other - Other Highlight
The program contains certain termination events, which include, but are not limited to, matters related to receivable performance, certain defaults occurring under the Credit Agreement or our failure to repay or satisfy material obligations.
Financial - Cash Flow
This decrease in cash flows...Read more
Financial - Expense
The costs saving initiatives include...Read more
Financial - Expense
(e) First quarter of 2021...Read more
Other - Other
The effective tax rate was...Read more
Other - Other
Most of our products are...Read more
Financial - Cash Flow
Cash flows provided from investing...Read more
Other - Other
Forward-looking statements are necessarily based...Read more
Financial - Expense
On an ongoing basis, management...Read more
Financial - Debt
Our credit and receivable securitization...Read more
Financial - Cash Flow
Cash flows from operating activities,...Read more
Financial - Dividend
Common Stock On May 5,...Read more
Other - Other
The effective tax rate for...Read more
Other - Other
Our Board of Directors will...Read more
Other - Other
Paper demand will remain dependent...Read more
Other - Other
Paper demand will remain dependent...Read more
Financial - Expense
Additionally, we recorded $8 million...Read more
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The effective tax rate for...Read more
Other - Other
At March 31, 2021, we...Read more
Financial - Income
Business segment operating income (loss)...Read more
Revenue - Product
This decrease in sales is...Read more
Other - Other
Factors that might cause a...Read more
Other - Other
At March 31, 2021, we...Read more
Financial - Income
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Topics discussed and analyzed include:...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Domtar Corp provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: UFS
CIK: 1381531
Form Type: 10-Q Quarterly Report
Accession Number: 0001564590-21-024666
Submitted to the SEC: Thu May 06 2021 11:30:58 AM EST
Accepted by the SEC: Thu May 06 2021
Period: Wednesday, March 31, 2021
Industry: Paper Mills