Cascades Inc. Reports Financial Performance for First Quarter of 2025

Cascades Inc. (TSX: CAS), a leader in sustainable and innovative packaging solutions, released its unaudited financial results for the first quarter of 2025, covering the period ending March 31, 2025. The report sheds light on various metrics that reflect the current state of the company's performance amidst macroeconomic uncertainties.

Q1 2025 Highlights

According to the report, Cascades recorded impressive sales amounting to $1,154 million, slightly down from $1,211 million in Q4 2024 but showing an increase from $1,109 million in Q1 2024. This variation reflects a mix of factors including changing market conditions and operational adjustments. The operating income for the quarter reached $50 million, a notable improvement when compared to $16 million in the previous quarter and just $9 million in Q1 2024.

Cascades also reported a net earnings per common share of $0.07, a substantial recovery from a net loss of ($0.20) per common share during the same period last year. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to $125 million, demonstrating a positive trajectory in the company's core operating performance despite fluctuating operational challenges.

Key Factors Influencing Performance

Hugues Simon, President and CEO of Cascades, attributed the company’s Q1 results to lower overall sales volumes linked to uncertainties surrounding tariffs, which dampened consumer sentiment. The first quarter is typically affected by seasonal factors, including higher energy costs and increased operational expenses stemming from reduced production capabilities. Nevertheless, the company benefitted from favorable selling prices and a decline in raw material costs, driven partly by the depreciation of the Canadian dollar.

Future Outlook

Looking ahead, Mr. Simon expressed optimism about the company’s performance in the second quarter of 2025, expecting a rebound in sales. He noted the anticipated benefits from previously announced price increases and improved volumes in tissue performance driven by positive retail trends and growth in the Away-from-Home segment. However, he cautioned that ongoing economic uncertainties may still impact demand levels across North America.

The company's net debt stood at $2,216 million, reflecting a slight increase from $2,096 million as of December 31, 2024. Cascades' net debt to EBITDA ratio remained stable at 4.2x.

Cascades continues to prioritize strategic capital investments, reporting total capital expenditures of $36 million in Q1 2025, slightly higher than the previous quarter's $29 million, but lower compared to $41 million in Q1 2024. The company projects that capital expenditures for 2025 will be approximately $175 million, indicative of its commitment to growth and sustainability.

Quarterly Dividend Declaration

Furthermore, the Board of Directors declared a quarterly dividend of $0.12 per common share, scheduled for payment on June 5, 2025, to shareholders who are on record as of May 22, 2025. This dividend reflects the company’s ongoing commitment to returning value to shareholders, especially during a quarter that has shown marked improvement compared to the same period last year.

Cascades Inc. remains a significant player in the packaging and recycling industry, employing over 9,600 individuals across 68 operational facilities in North America. With a focus on sustainable practices, the company seeks to balance profitability with its responsibility towards the environment.

The financial results for Q1 2025 demonstrate that while Cascades faced challenges, it has also shown resilience and adaptability in a complex market landscape, positioning itself for potential growth as the economic climate evolves.

Conclusion

As Cascades continues to navigate a dynamic market environment, its recent financial results indicate a pathway to recovery and growth. Investors and stakeholders will be keenly observing the company's performance in the coming quarters as it implements strategies aimed to enhance profitability and sustain its operations in the face of evolving market demands.