JACKSONVILLE, Fla. - Rayonier Advanced Materials Inc. (NYSE: NYSE:RYAM), a company specializing in high purity cellulose, has reported a fire at its Jesup, Georgia facility. The incident occurred during planned maintenance on Sunday. The company's emergency response teams, along with local firefighters, were able to contain the fire swiftly, ensuring no injuries and no risk to the community.
The Jesup plant is Rayonier (NYSE:RYN)'s largest, with a significant production capacity for cellulose specialties and fluff pulp. The facility's C line is back in operation, but the A and B lines are expected to be offline until the week of October 28 for repairs, particularly to instrumentation and electrical systems affected by the fire.
The company is currently evaluating the financial implications of the fire, with an estimated EBITDA impact of $15 to $20 million, pending insurance recovery. Rayonier will provide more details during its third quarter earnings call scheduled for early November.
Rayonier Advanced Materials is known for its cellulose-based products used in various industrial applications, including filters, food, and pharmaceuticals. The company, with operations in the U.S., Canada, and France, reported revenues of $1.6 billion in 2023.
The information in this article is based on a press release statement from Rayonier Advanced Materials Inc.
In other recent news, Altamaha Green Energy (AGE), a joint venture between Beasley Green Power and Rayonier Advanced Materials, has secured a deal to supply up to 70 megawatts of electricity to Georgia Power Company. This development is part of a renewable energy project aimed at converting forestry waste into sustainable electricity. In addition, Rayonier Advanced Materials has seen significant growth, with RBC Capital Markets raising its shares price target to $10.00 and maintaining an Outperform rating. The company has also announced a price increase for its Cellulose Specialties products due to ongoing market dynamics and escalating costs. Furthermore, Rayonier's second-quarter earnings for 2024 showed a 152% surge in Adjusted EBITDA, leading to an increase in its full-year EBITDA and adjusted free cash flow guidance. These recent developments indicate a positive trajectory for Rayonier Advanced Materials.
InvestingPro Insights
In light of the recent fire at Rayonier Advanced Materials Inc.'s (NYSE: RYAM) Jesup facility, investors may find additional context from recent financial data and analyst insights valuable.
According to InvestingPro data, RYAM's market capitalization stands at $589.74 million. Despite the recent setback, the company has shown strong market performance, with a remarkable 218.51% price total return over the past year. This surge has brought the stock price to 99.78% of its 52-week high, indicating significant investor confidence.
However, the company faces some financial challenges. InvestingPro Tips highlight that RYAM suffers from weak gross profit margins, which is reflected in the latest data showing a gross profit margin of 7.58% for the last twelve months as of Q2 2024. This low margin could be further pressured by the recent fire incident and its estimated EBITDA impact.
On a positive note, InvestingPro Tips suggest that net income is expected to grow this year, and analysts predict the company will be profitable. This outlook aligns with the company's revenue of $1.59 billion for the last twelve months, despite a 12.13% revenue decline over the same period.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for RYAM, providing a deeper understanding of the company's financial health and market position.
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