Magnera (MAGN) 3 Nov 222022 Q3 Earnings call transcript

Good day, and welcome to the Q3 2022 Glatfelter earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ramesh Shettigar from Glatfelter. Please go ahead, sir.

Thank you, Sarah. to third-quarter welcome conference and morning, Glatfelter's earnings XXXX call. Good president, Ramesh officer, Shettigar, is chief senior This vice financial and treasurer.

On quarter results Fahnemann, present our today to and Thomas officer. president our the is new executive with call me chief third

I begin standard reminders. a we Before have few presentation, our

in as reconciliation results During our and of earnings measures our GAAP-based earnings these included we other in non-GAAP release the term will financial investor call as use financial is today's this adjusted morning, slides. well the measures. A to

will also statements forward-looking make to risks today subject We that and are uncertainties.

periodic Our obligation from reports call on XXXX Form now these to statements speak forward-looking cause no to our of XX-K and release, will turn could the all that with our today's SEC statements. and available These which actual factors are we as undertake quarterly and update only results materially the differ over today, I disclose website, them. our filed to Thomas.

to call. today. it everyone, to you is with our and Hello, be third-quarter a CEO, my welcome This first call Glatfelter conference and pleasure as conference is

leadership of are benefit to Since it's of manufacturing me time spending joining and visiting business and for company, customers assessment investors, team. two extended steps share worked opportune return our time sites the With for at an with to the and been I've the taking my having to we Glatfelter months, the profitability. our meeting with engaging

from have remarks There on I performance. today's gained early our will my report takeaways today, three insights The will of my call. key are the Ramesh tenure be in and focus third-quarter

challenge difficult, and on have Europe. had especially our our energy operating and business. severely a inflation remains prices negative rising in environment impact persists The First,

challenges, improvement. perform the segment Despite of is fibers and well showing all encouraging signs to composite continued these ALA

our fundamentals current competitively in turnaround Glatfelter Second, third, our strategy markets challenges. of attractive growth despite sound to underway. strong. The positioned already achievable simple, are customers our and remains is And underlying well business plan serve is the and global

our early ability contribute of our And precisely structure, today. is profitable Our goal comprised QX capital are to and progress that Glatfelter headwinds economic more helped delivering is portfolio, long-term line, return our attracted have it's Glatfelter. the optimizing we of The capable for plan six opportunity already bottom at navigate position to and operations signs The which our of is the growth. profitability, to strengthen me seeing to that to performance. to initiatives is than this aimed our far Glatfelter company

of of I of traveling international and reach. is a And time markets, floor. also leaders and course, our I'm bring years many our materials the shop deep operating major the footprint helpful to XX in turnaround familiarity years various I'm leading industrial spent our efforts. focused applying consumer-driven similar industries leading on and a best part which particularly manufacturing. the engineered different individually I've global business through understanding industry, walking collectively facilities having with experience companies bring the with and change, I given to spending and lead that spent Glatfelter's

to guided values and integrity I've degree seen and challenges shared business. to organization. desire despite firsthand respect responsible the continue the many strong of is that and be to facing our a customer-focused, There people by contribute socially environmentally the a

this together, change. is to from team executive the strong, is both is which and foundation an culture drive excellent capable Our committed. And

frankly, have to for challenging importantly, some market and deeper continue between much the macro and the actions the ongoing walked inside, energy and, need been this conflict most time. prices, immediate from appreciation been be door, company in a Russia and plus will day how conditions I to Ukraine. business hard The seeing I Today, with had the the benefit and inflation by the knew hit have of be for rising I implemented.

While there to and Europe, continue near-term macroeconomic the will may headwinds especially volatility in relief be around undoubtedly pricing create environment, energy for optimism some our business.

have I is them. this company compelling served a reinforce clear to all, its collaboration and months which see materials. relationship I'm with a products The of investment spirit on and of customer company. by leading solid positioning, the established this market contributes have position strong top and a of and past a view. Glatfelter It as two has has thesis competitive supplier strategy customers, for built quality innovative impressed met I the engineered to with global partnership our

to to to are everyday segments are products need market is I serve witnessed now of our employing life we our we is the issue will techniques it's and turnaround our And in that throughout where economic regardless The the our not manufacturing to strategy. address customers. three performance our evident The aspects essential improve company not specialized positioning problem in technologies are overall we our and cycle. plan it's of which rooted execution, address. our

will provide details the strategy. Ramesh? Ramesh, from I hear additional you After on turnaround

Thank of driven the EPS guidance investor to we was you, The took our close spunlace Despite challenging segment. primarily the continued of economic highlights $XX.X was million $XX and loss $X.XX third-quarter GAAP our the EBITDA presentation by Slide Thomas. performance. of in million. previous backdrop, provides adjusted X inflation the charge and of impairment

slightly and quarter operating EBITDA. profit Supporting segment delivered fibers for this expectations. a our results record also Airlaid on above performance was Composite Materials

of spunlace the third Slide EPS the significantly However, bridge year below widening adjusted in to a gap was this a from expectations quarter X of in of and year. shipments. $X.XX shows price last by loss of third the lower cost quarter driven $X.XX

to our pass segment's through operations EU $X.XX, by coupled sanctions. supported the and results mix volume by and prices, cost than inflationary the from increases, depreciation lower-than-expected as high of fibers elevated to price offset favorable outpaced due the inflation and of impairment not lower selling Spunlace favorable closed decline inflation October in for improved $X.XX at pressures related Dresden earnings year. rates, the the production Airlaid note, volume as in North shortages with labor and lowered last by demand of was America. cost effectively had earnings a that currency XXXX results results Composite results as waste and result Materials more increased higher input inefficiencies To primarily and due hedging to end to the ability higher customers, acquisition by spunlace QX from $X.XX the in the earnings U.S. strong

up $X.XX pre-COVID last but earnings issuance Slide without and $X.X expense allowance Corporate XX% travel $XX costs higher of spunlace were shows by valuation Interest guidance arrangements. basis of taxes our a bond operations from year, for Revenues a stemming a lowered finance were of third-quarter relatively as same for summary mainly selling price in acquisitions, due to such other and contractual X increases the Soultz, prices well versus $X.XX levels. prior Materials. currency higher and of period, to with approximately constant $X.XX cost unfavorable, as to line Airlaid on new a pass-throughs spending mainly driven million related by year two by in France. and with versus unfavorable results customers million driven were the items initiated

by X%. American production X% care driven Operations shipments, Volume year home driven to higher North lower by meet up sequential in $X.X and tabletop million, by was volume were although mainly our customer weaker favorable demand. sites by year, over was strong

million, the euro. from of $X.X the by unfavorable was resulting exchange Foreign weakening

we prices of offset mechanisms higher have quarter XXXX, For effective given cost expect inflation, to in a we the the continuation place. selling of pass-through fourth

by million expected reflecting $X - results impacting to million shows X X% the on is lower, to constant same the XX% is $X for by in be were X% despite summary quarter to quarter Volume with to expected Slide quarter. a be Operations $X fibers line segment. basis fourth being seasonality normal lower and in volume unfavorably third-quarter results Total last a year. versus the composite third the up of revenues by X% currency million.

over impacted XX% prices of category as increase revenue XXXX of accounted actions converted was by have energy year was sanctions. to Lower million. to over The as the Lower $XX pricing unfavorably a results taken mechanism, product EU this XX% the approximately impacted inflation. shipments offset multiple overall for price the we decline wallcover higher by of approximately coupled year surcharges mainly in $X.X volume successfully with XX% most to base and million due revenue revenue of floating selling

freight, in energy, of raw escalation price $XX.X year. key the by earnings million last and lowered materials Continued same quarter the versus

$X.X driven reduced the second favorable million, and following overall the by were other depreciation taken and impairment spending lower quarter. Operations in Dresden

manufacturing Foreign bring footprint cost British margins taken a mitigation exchange hedging its turnaround to in in the U.K. gains. currency our aiding are segment weakening back to and profit composite was and of the favorable in pre-pandemic cost $X.X million Overall, goal fibers pricing benefit our levels. the pound, actions the segment's the from creating

we with XXXX, mix, shows projected prices of X% offset prices. million. is results raw segment. be Slide to and material to Looking summary results for the fully better fourth expected quarter ahead a spunlace impact the energy And higher. selling to of $X X about combined by favorably approximately when to expect third-quarter Volume is higher

sites lower were our to was approximately impacting labor with in together, expectations. by U.S. weaker combined prior shipments QX. below shipments million, volume shortages The $XX related compared Revenues impacted This, unfavorably million production our and $X.X while were than results sites our to lower X% European when in from decline mainly quarter by demand. driven

inflation were and reduction other more integration consumption lower $X.X than and favorably energy cost higher net costs million. surcharges European and energy combined at favorable, driven million energy and material items a overall offset mainly million by sites prices Selling were lower totaling by raw FX Operations, impacted $X spending. efforts, $X our continued by but results

reaction million. XXXX, offset higher prices and For from lower, a raw the to unfavorably inflation. impacting profit operating by selling is energy driven be XX% price-sensitive recent of by increases, price to fourth XX% customers Volume expected material million $X to quarter we our $X approximately to to expect

an of X corporate for a expect other and the quarter. million operating we As shows items. approximately Slide result, costs financial $X loss

higher spend. were and to costs corporate million versus by legal, quarter, period corporate the lower last For same mainly travel due the relatively year, $X.X

are to previous guidance. million with full corporate year, the costs line For approximately $XX estimated be our in

$XX interest and in This to costs X the previous are Slide full-year is costs to be increase higher flow approximately other financing summary. also devaluation shows our vendor that cash than U.S. euro foreign in rates Europe $X tied the million, million to interest expect ruble. driven the and guidance. our and due We and higher exchange financing by

approximately $XX On period million usage was million. termination lower year, capital last same Working factors, by basis, and free versus and energy. adjusted of higher materials to working raw by negatively driven million inflation multiple $XX our to program, higher spunlace cash flow usage a in inventory values elevated our primarily usage. receivable of added million cash cash Lower driven factoring $XXX capital year-to-date was capital U.S. by the due the XXXX by price accounts including and the due $XX higher earnings expenditures to increases impacted

Other were and interest contributing factors paid. higher taxes

to for Mount previous capital expenditures projected $XX XXXX, lower is highlights and and between euro. capital than $X guidance, weaker million be lower below continued further is and Depreciation and and million expect by spending to Holly $XX be $XX expense spunlace allocation. approximately driven We discipline our million. a our million including $XX This previous around amortization our or capital million guidance

And enterprise and sheet be XX EBITDA balance million metrics. Slide quarter $XX between for the we finally, to and shows expect liquidity $XX some fourth million.

increased to as June of XX X.X XX of covenant as due times leverage times versus ratio September to spunlace bank weak Our earnings. X.X

million, end of earnings and be the the QX flow was delevering at liquidity our generation of $XXX and near-term cash to on focus approximately sheet. balance available growth, continues Our

prepared my concludes remarks. This the now to back turn call I will Thomas.

Ramesh. you, Thank

strategy. our of focus. of an six our turnaround overview areas for see On you Slide can Now XX,

second, optimization; profitability. improvement; spunlace reduction; cash portfolio and sixth, liberation; operational fifth, fixed margin First, third, returning fourth, effectiveness; cost to

those market-leading only value Starting at assessing part strategic the manufacturing in at resources are strength. strong that the where near to and scale of to own time are we currently for and align term. have or eyes potential We the optimization, the and portfolio portfolio team, that optimize have with together have a with the Glatfelter's a competency with financial with we asset of of each we invest considering the technology. looking our we everything the the in assets our and ensure with we to and of position assets long benefit move portfolio areas core for our every how and looking I forward intend fresh scale,

elements business of we Airlaid Our drive how these EBITDA is great example contributions. to improved used a performance and have

looking of as our The what to at Airlaid focus is will the as address apply indication segment other serves assets portfolio. areas we an this best to the be are Also, same we possible of non-core. that way

in on have unique of significant differentiator those those assessment. important either do like in allow consideration particular not profitably that focus us share product that that and market will a an or is Size this to a will scalability We a compete category.

If is not important to to hard profitably we this just one will for for - are but too global a very on scale. small, potential is be us of future course, going going And it of be to the contribution many it's consider EBITDA compete factors. we

We are enable debt, continuously us there our reset on believe assets our noncore that to portfolio, we reduce business. and opportunities assessing leverage our are may down focus to core and pay divest

improvement. Turning margin to

our turnaround fundamental a of is This part strategy.

simply top-line place growth. We will greater rather on profitability focus than

term. short critical to step way this we There improved EBITDA. will expect shift, around path the volumes no its and is the in make on we can first As this, that soften

the focus and and addressing cost. we have between opportunity team communicated and our economic we the which to recognize in operating. Our have customer improvement is progress our done we efforts are our largely it. been margin has by accepted price Everywhere it the inflation. has customers will increase every products making value had who input and gap good cost constraints on The to closing prices,

As will our a competitively productive price we levels. we pressure be to continues, confident able at rates that drive profitability pre-COVID and to back inflationary are

we Like turnaround evaluating driver were the is cost the the businesses current base presents the While for are margins, rising which opportunities improve input to economic prices in our environment, cost third across for margins. our potential savings also compressed the fixed of initiative business, main all plan.

As move or we leaner product a will jeopardizing investments our quality people. to we base, cost not risk in safety,

implementing With conducted in of our a XXXX. full savings based administrative we by are that will generate And year changes to rate analysis, sales of the we resources. that review general on million said, $X bottom-up million run our $XX range and

cash liberation. need to for down pay EBITDA. fourth Now increase debt, leverage initiative, our our decrease Clearly, we and

and spending, to that decision-making be operated This finished are controlling which a significant allocation disciplined also reduction managing prudent require and will with pricing. from where material our inventory raw capital to million, goods million we To $XX receivables, a end, previously. capital tightly to respect our we to accounts $XX approach we expect

approximately cash the of will dividend, board free already acted the has to addition, In suspend million which up $XX annually.

actions the to portfolio cash We through the I referred are earlier. initiatives, and flow supporting this across by optimization to improve business

Turning operational to initiative number five, effectiveness.

past. Sigma approach I the full time do Here, the of our have in will be largely but informed from We and Six of principles. culture, the adopt the discipline benefit which comes can still Six approach Six overhaul the by not business, that with implemented we to luxury Sigma successfully have the Sigma

processes continuous We further and are have drive already eliminated identify can can started where excess falling and where to focus. short, customer that quality waste we be improvement ways

business up because is areas we in in our that great of legacy of what Airlaid do it the place terms in can to Airlaid Glatfelter all in a standards that can are turnaround improvements so, best need our business. operational these example and the of confident the bring plan. doing demonstrates I'm efficiency, capabilities needing initiative by throughout KPIs that The is sixth practices. is operational leverage focus benchmarking in most our organization. customer We to implementation drive spunlace excellence achieve pronounced area and excellence our to business, for to operational

tackling elements to we plan underperformance and also the a initiative are overall which intensity the the of challenges. five urgency turnaround other with given While separate and segments each we of highlighting spunlace, apply our are

businesses. provide whether sure was is the it my other a spunlace perspective, composite branded that portfolio business access strategic From me I'm spunlace fibers manufacturing to are a to the and a in us logical decision a to things, value gives business. the on Among addition Airlaid perspective this very a acquire for to and adds complements nicely the to As our likely portfolio. good our acquisition and business good business investor, of spunlace an technology nonwovens you looking

pass not in asset charge date, performance with of impairment than segment's could lot The what on as able is first anticipated. composite indication to we energy is Airlaid and raw company the along a cost-competitive Operationally, fibers. as with there is spunlace this input costs and more material this we work currently, us that to not are we of be. taken originally the was are the can have ahead through a effectively Spunlace challenges. it clear Overall, not is and acquisition thought

is spunlace return I the understanding profitability. believe stabilize the to a to team good business what of to has needed

so the address for speed This optimize demand. message but my base and under execution cost new output will the you, can a is leadership customer of and changing the accountability. we isn't of We level meet is

have leadership reports the the through spunlace our We me. structure into reporting directly business of changed

up The to on team there. in It to immediate as Airlaid execute segment informed X, an we get make is not required business. supported I'm our is absolutely quickly. the and but ensuring decisions clear the be we can better we work for using deliver to action, the with the be will instilling equipped the return will will profitability, confident an to to by By easy the bring to rigor same need and resources accountability priority. needed which turnaround standards operations methodology our the and

give our The update issue, QX an EBITDA open and our report potential when results. you on for progress an I longer-term growth will we remains

half turnaround throughout it the improvement optimistic quarter-to-quarter an timing, of we next XXXX. long the take will in will to year. On start plan? Now to will impact first overall performance How we improvement see I'm will within the deliver be? related generate what questions. the our And And

volatility conditions, coming in including the and lasting recession in of ongoing in pricing. Europe whether market also there the success any by from part months is our will be looming course, the relief energy determined Of

the within I control. of on As at factors the focused our said we remain the start call,

time execute of be our focus the from to now to this XXXX. terms line will all In of our turnaround,

are Regarding much team today. value deliver potential significant and and the are I management and entire EBITDA than Glatfelter they creation that can levels upside, higher where impact confident annual upside at

market and that. is of speculate premature turnaround At uncertainty, the stage early to beyond considering this the it

conclude we be within that we million million XXXX. $XX $XX are fourth the deliver and We - will that to guidance perform will able of be range for the to confident quarter of And prospects will of this I'm right from and business the today's the our this forward. we resources encouraged improvements and ongoing execute point place strategy. by talent against call, turnaround To that have to in

I'm committed progress. to call Glatfelter within to our well is reporting look I that, it will and next And confident performance, our I the for questions. over turn level to lead of you reach. with to the on I'm forward back

instructions] we'll [Operator Sidoti. Ramgopal And question from take our Mitra with

for initiatives Thomas, for and thanks the detail color turnaround strategy. the the around

get a shortages, just terms see I year, First, you again, existing want in potential raw recession. potential already next a compounding that into material confident we to sound there and demand. in And the energy results should of etc., we're consumer out starting very labor given and pressures, that heading now sense, slowdown issues to the start costs,

showing will wondering improvement. that you Just the gives to what be you confidence start able

marketplace, as question. I And mean, possible. that is a What implemented will and right, Yes, Number be probably for Europe heading we we very are the are Mitra, this thank seeing soon confident as control. in focusing we you're are you we the on recession. into issues one, can the

our tailwind. next that products. will that the hand, at fibers business mentioned might economic cost hoping at over our get significant But implement the And will I situation, improvement composite at good again, if is If pretty are I feel are about as look our strong. and to will we these six portfolio and we before, show our little improvements a base. in months I other And three turnaround bit we the plan on looking need overall pretty of our we business, and consumers look Airlaid the product we

next things performance. we're still European hearing the we we hopefully from can Early really be control, signs based that we what can on But we the very improve will and right very, side improved the our are that confident year. can is that energy now situation

has example, for and a Germany, gas. cap implemented really now for As power price gas

So that tremendously will us. help

out able but control energy now we overall, are be we we little the have energy that very that that quarter And by very situation, difficult, get, with control. we bit certainty number so which the on under more how next And ourselves deliver is really can shake actually a optimistic we improvement year then to things price will quarter. still can one, prices will

I internally. of you if only feel you And months, is execute mentioned just wondering And think control, been you obviously, to I feel the the a one execution know the you was the place in do can of things have team strategy? I couple but you - it's

absolutely. Mitra,

now very, I weeks, think it's the nine really together. management and we have, we time - spend a And and I'm again, imagine, might of very lot pleased as you team. with

everybody is think committed. I

this skill I right we everybody team of the And think have that don't lot place. very here the done. And is problem are a in have and the us. this we I things have to I that face committed, no with one get think optimistic strategic is doubt do, And of that just ahead we of I'm Glatfelter. a which kind but there's challenges the to have very, work right reiterate I of XXX% to is we set want

portfolio. the have we think I right product

We main this need focus are on focus. And businesses. to in our the We execution. right really is

We and urgency sense we execute, a have of company. the to within I need created think

everybody think in do. the I need company what knows to we whole

are that optimistic We we getting now. done And think so I'm - have accountability. things established extremely I

will improvement. our quarter-by-quarter in you this hopefully, see And

I implementing the to deal higher in Okay. prices think had costs with etc. terms you've energy, material and raw of success selling And higher

more - environment. Just of - the slowdown the demand end of curious any if on you're market the result demand inflationary seeing a as

the look in really I to have I If at we Yes. I really businesses confident. are my Airlaid, drive we other and business, remarks, the we everything mentioned to need are - I I and in in Airlaid Airlaid is the again, we benchmark improvement feel of a example implemented - need mean, we that to little bit. is the have other differentiate looking and I mean, very for, doing business the think mean like business. we at kind we

I I know we we know mean, it. it. not like It's that to have said, the to We do to reinvent wheel. how how do

business So extremely our Airlaid strong. is

price We volume on which increases, and there. implemented necessary problems inflation, were based further we haven't big seen any

a So this is pretty solid business.

as And fibers we so through. is as also lot a of far increases pushed in concerned, already composite price September,

a seen weakness have We little but volume of significant. there, and bit nothing in here

it's mentioned problem, focused now. but biggest in problem Our not of where problem lacking are is a I on have right business, in our areas we spunlace cost of certain which to we And we and our control. get pricing. also are was a under before, what this excellence, just It's operational as spunlace structure

$XX big of following by I that. one just Pricing is identified on Obviously, of $X the Well, Okay. up is SG&A to improvement you million and margin goals. think reduction about XXXX. million helping, certainly certainly

probably I'm sort and cuts, of fair? that so evaluate Is low-hanging just first speak. take, is to additional a as assuming that's fruit this you

was of want acquisition before, the is mentioning what we And Again, after the top spunlace. our - an is of on team on did in-depth of That's also already emphasize Okay, I is here, fair. Yes. what million this kind I SG&A. did implemented $X the analysis to million to $XX we

again, that's - XXXX. on this. it. So we this implementing rate full This will And is actually are already of the way. top on the in achieve And is run

of see in bit will that XXXX. little we already a So

then XX% rate the right this. in will are say, now, you the see, this also which And are improvement. see I We will will be run XXXX, then implementing but we of quarter-by-quarter would XXXX. other doing improvements so we full - in And all

and QX, little improve And if performance longer, but with take actually able at quarter. now EBITDA from there's And based be on that we QX, something this you this look confident a is bit XX the quarter in which there we by to very are on, might should our our base.

Obviously, to Okay. lot cash And of source be up And cash suspending frees of liberation. as relates noncore assets dividend cash. infusion. sales another a the of could it the potentially

Is is expect sense reduction. generate looking you working that for -- to capital potentially you be for improvement even my XXXX, cash sufficient the and able But at flow improved should debt

Yes, that's fair.

I look at as balance a leverage of peak sort the sheet, now quarter. XX% the XXXX? that to And about net of into went think up as we end see we at heading the could

want earlier, is - we a fair don't but regarding the cash liberation. where I QX. not for point, past But we it's up XXXX brought assumption think at are we to which Mitra, now guidance this the providing I anything same as to expect that the we're leverage range come what in right to QX back for be is point you

that now. the lever right at of our Thomas significant talked we a about dividend. is that suspension disposal think have the I

tightening the dues, not kind million our absolutely about more in our to past talked only down debt. of inventory, going cash free tightening previous after reduction generate $XX I These initiatives, up relative we're guidance. all terms. are Working will spending payment capital capital will toward which going but initiatives flow, that allow to us also be the put after, to up paying going be

So improvement leverage. to be should also our a that direct

capital capital other side we're then the cash on, other down it of the hit approach cost allocation, kind house, portfolio we're going review right? EBITDA So to from uses noncore this to and working on and assets reduction, and of pay of debt. going that any is pricing, around so about the on side Thomas both which initiatives talked will us of from the allow sides, the to

charge know I And Okay. Great. there a was in impairment the goodwill quarter.

into the lot any of of a 'XX? curious, what should right onetime once turnaround, with items we we more Just get parts now, sort moving anticipate obviously,

spunlace a period We standpoint the even we Mitra. inside of acquisition. every year took as the an was business. from the We assessed do this pretty XX-month No, view of holistic impairment anyway. This

kind was don't quarter. ran unless this goodwill, where we the we that - cleared near don't is of out do. spunlace operational as the And felt what we about, appropriate a spunlace been, there was for when additional But or of the and at all we business basically necessitated for on talking for has expect charge the forward-looking Thomas any rebalancing of it valuation, the any expect We which rebalancing picture out the that the portfolio this that impairment coming that looked reviews is thing to out we performance future. took may capacity be

Okay. And segments. then just some on final the questions

Airlaid customer you at think demand, you're still lines. seeing but in If mentioned you of the you weakness some had I materials, some look strong

comps I year-ago just more else. think a versus anything that's difficult

I correct. agree that. would Yes, with Mitra,

composite And - the the I on yes? know fibers,

No.

because to right XXXX inflation, relates time frame it You're different and so was as on. energy, very a

So we has comp slides some financial to point see categories in very today different performance related the than also being in are of comparison that a and with to product you that XXXX. year-over-year where economic backdrop do the in

in impact or increases, not or is year-ago the it case the then sanctions just softness difficult fibers a But Russia-Ukraine the question some Again, you by have And Right. start other price of in wallcover where maybe on being the the a of conflict. on down terms demand definitely an driven comp. segment, the with really? to composite saw lines, impact

the on easier it's are where a No, this this is pricing mean pass a we was September, mean, and in complicated increases right, environment. there I was other also pockets where had a Mitra. and where in I of to Yes. our it competition. I on we mean, areas have were going lot of - implemented more of businesses pretty bit little And inflationary there lot certain yes, you're we

the we were versus volumes. on price there was was to little increases, to volume softness if I The much mean, overall, pass loss. at had on look But - we our really the able softness customers not we

economic Now overall, this, fibers is the in see the to composite businesses I might areas overall economic there would weaknesses we and of There's vulnerable more future. say, certain situation. our doubt about no some - overall

seeing we overall that, the Okay? There's U.S., of overall existing rigorously off we even for are market, urgency. But the We confident with I and will will time to a control, business, the have in we can much on I'm Europe focusing depends happen but are for will but we how will If like be sense improvements. this right actually the the no are see in the about in, be a ready mean, doubt been, better I and things we the lot we where control or are are improvement yes, and we would huge problems market. is in we again, executing environment things market, question our if that this are we and the on much - have impact reemphasize, this we in recession we can us, on than The that. - always -

ready also we that. to And really to think pretty order take time. little concerned a as this. bit here. in move in of spot, we will time for I And far bit is on spunlace a get cost more get little and a situation our need this And fibers all think we But and actually good we're as and from composite need concerned, Airlaid is can I

place European want The hearing the promising will - of just and in and good over cap we the for out will of us. are power. that are all actually and factories exposed in side quarter that with Germany And actually is, a will of part be there there in for are and cap we especially very they I XXXX kind to XXXX. lot Germany, tremendously news energy of of gas price the help be this I mean first for a this will

So help lot. that a will

it it with cost and our overall I helps certain us volatility structure. a And also think out takes

I positive fact actually that news. that's looming there a recession, is yes. the Despite mean, So

Right.

Okay. No, getting that's to great. Certainly call. earnings look on forward the update an next

Yes. you, Okay. Thank Mitra.

you, Thank Mitra.

question-and-answer over would conclude our turn does I for that like additional remarks. And the conference to Thomas to any closing now or today. back session

and back Thank of Yes. with And to earnings us. QX I'm Okay. about spending end XXXX. looking reporting our you, everyone, time being February for of forward

And call would Thank then then you. that conclude today. our

today’s conclude your appreciate Thank We participation. you. That teleconference. do does

You disconnect. may now