SWM Announces Second-Quarter Results

Schweitzer-Mauduit International reported sales of $377.8 million in the second quarter of 2021, up 48.6 percent (11 percent on organic basis) from the comparable 2020 quarter. GAAP operating profit was $15.9 million, down $18.5 million, and included $19.2 million of transaction costs and incremental purchase accounting expenses driven by the acquisition of Scapa, which closed April 15, 2021. Adjusted operating profit was $44.6 million, up 3 percent from a year ago.

Engineered Papers segment sales were $125.8 million, up 4 percent, driven by a 3 percent volume increase, unfavorable price/mix of 4 percent and a 6 percent currency benefit, primarily related to the euro.  The volume performance was attributable to growth in nontobacco products, such as battery papers, furniture laminates and packaging. The negative price/mix effect was primarily a function of lower low-ignition propensity volumes as certain customers resumed more normalized order patterns versus 2020 when they built inventories. Accelerated growth in reduced-risk heat-not-burn products continued to be a positive driver within the tobacco business.

“The strength of our portfolio was again evident during the quarter as an increase in global economic activity drove very strong demand across the business,” said Jeff Kramer, CEO of SWM, in a statement.

“Excluding the benefit of the Scapa acquisition, overall sales increased double-digits, and we are confident that robust order activity will continue in the coming quarters. We also closed and began integrating the largest acquisition in our history as Scapa joined our portfolio, putting us in even better position to drive sustainable long-term profit growth. And while we were not immune to global supply chain challenges, our teams again demonstrated their flexibility and skill in delivering against these increased volumes, resulting in second-quarter adjusted EPS of $0.90.”