This article first appeared on GuruFocus .
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Revenue:$550.9 million in Q2 2026, up 2.8% year-over-year.
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Adjusted EBITDA:$90.6 million, up 25% year-over-year, with margin expanding to 16.4% from 13.5%.
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Net Income:$22.1 million in Q2 2026, comparable to the prior year period.
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Consumer Business Revenue:Increased 1.9% year-over-year to $457.6 million.
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Away-from-Home (AFH) Revenue:Increased 7.4% year-over-year to $93.3 million.
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Consumer Adjusted EBITDA:$85.3 million, up from $69.2 million in Q2 2025, with margin improving 3 points to 18.6%.
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AFH Adjusted EBITDA:$8.5 million, down from $9 million in Q2 2025, with margin declining 1 point to 9.1%.
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Canada Revenue:Declined 2.6% year-over-year, down $7.7 million.
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U.S. Revenue:Increased 9.5% year-over-year, up $22.5 million.
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Cash Position:$165.2 million at end of Q2 2026, down from $205.9 million at end of Q1 2026.
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Leverage Ratio:2.9 times, stable compared to Q1 2026.
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Capital Expenditures:$15.5 million in Q2 2026, with full-year 2026 CapEx expected in the range of $90 million to $110 million.
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Pulp Prices (Year-over-Year):NBSK average prices declined 13.4%, while BEK average prices increased 15.2%.
Release Date: August 13, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Adjusted EBITDA grew 25% year-over-year to $90.6 million, driven by higher U.S. sales volume and lower pulp prices.
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U.S. revenue increased 9.5% in Q2 2026, supported by robust consumer and away-from-home sales volume.
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The new Memphis converting line is progressing ahead of plan, expanding capacity and improving mill performance.
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Facial tissue market share in Canada increased to 47%, strengthening the company's leadership position.
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The away-from-home segment delivered sequential growth in revenue, volume, and profitability in Q2 2026.
Negative Points
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Canadian consumer revenue declined 2.6% year-over-year due to market softness and consumers trading down to private label products.
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Market share losses in Canadian bathroom tissue and paper towel categories were experienced, with a recovery plan only expected to improve shares in the second half.
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Away-from-home profitability declined slightly year-over-year due to elevated transportation costs.
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The new TAD facility in the Western U.S. is taking longer than expected due to greenfield site due diligence and economic uncertainty, with no final investment decision timeline.
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Cash position decreased to $165.2 million from $205.9 million in Q1 2026, primarily due to changes in working capital.
Q & A Highlights
Q: You mentioned a share recovery plan for Canada in the second-half. Can you give us more color on how that's going to work and what the main levers are? A: Dino Bianco, CEO: We saw some erosion to our share around March, continuing into April and May, mainly in bathroom tissue and towel. We started to see some recovery in June as we put plans in place. The recovery involves correcting price gaps at some accounts, securing additional promotional activity, and tweaking communication for a towel product that wasn't supported enough. We're also lapping a very strong "Made in Canada" sentiment from last year. It's not going to cost a lot of money; we're basically tweaking and focusing on execution. We're already seeing benefits in mid-August and expect continued progress through the second-half.
Q: How far along are you in realizing the full earnings potential of the Memphis facility, and what incremental productivity or cost benefits can we still see? A: Dino Bianco, CEO: We are progressing quite well, but probably have another year before we get to maturity level. The performance improvement is visible, but we still spend a lot on maintenance to get assets to base condition. Once that's done, we'll get back to normalized maintenance costs, which should improve the site's economics. We're also looking at additional investments to increase capacity for ultra-premium tissues. The turnaround is sustainable, and we'll continue to see growth into 2027.
Q: The TAD facility seems to be taking longer than expected. What milestones should we look for over the next six months, and when will a final investment decision happen? A: Dino Bianco, CEO: It's definitely taken longer. The primary site is a greenfield, which requires a lot more work on infrastructure, water, permitting, road, rail, and wastewater. We're also dealing with a very uncertain economic environment, including tariffs, the status of KUSMA, and geopolitical impacts. We want more clarity before making such a big investment. We remain committed to the project and our growth in the U.S. I'm not going to give a specific date, but I hope to provide clarity before the end of this year.
Q: Can you quantify the magnitude of the price increases announced in the Away-From-Home (AFH) segment? A: Dino Bianco, CEO: We announced a price increase of 3% to 5%, effective September 1st, mainly to cover transportation costs, packaging, and oil-based inputs. This applies to Canada and the U.S. and affects about two-thirds of our business, as the other third is on contracts that renew later. Others in the market have also announced similar pricing, indicating the market is feeling the same cost pressures.
Q: Your Q3 guidance is encouraging, but you're working to restore market share. Is there a component of balancing pricing with desheeting and other innovations to keep per-sheet pricing stable? A: Dino Bianco, CEO: We're looking at all that. For bath tissue, it's very important to have a competitive format and price point. We're not the lowest priced product, but we need to maintain a certain gap and ensure we don't exceed that gap at any customer. We continue to look at innovation and product formats, but we need to get our fundamentals straight. There's also a natural movement to private label as consumers feel cash-strapped, so we may promote more of our base or value products to offer that price point.
Q: Does the Q3 guidance assume no tariff impact? If the potential 338 tariffs were in effect, what percent of volumes would be affected? A: Dino Bianco, CEO: We're preparing mitigating actions like pre-ships and alternative sourcing, but we don't want to trigger anything dramatic until we understand if tariffs are going through. We've reassured customers there won't be an impact. As it relates to your specific question, less than 1% of our total sales would be related to this tariff, and we would continue to manage that down.
Q: Valmet announced a new Advantage NTT technology for ultra-premium tissue. Are you locked in with TAD technology for your next mill, and do you see NTT as a potential threat to TAD? A: Dino Bianco, CEO: There are always new technologies being introduced, but TAD is a very proven technology that has been around a long time. We have two TAD machines in our system and know what they deliver. We're going to have a strong conventional base and a strong premium base with TAD. Other technologies are not where we want to play. I'd rather be in the technology we know, the technology the consumer wants, and the technology the market knows how to operate.
Q: Can you remind us of the mix between hardwood and softwood pulp in your furnish and your ability to flex between the two based on relative price momentum? A: Dino Bianco, CEO: I'm not going to give a specific answer, but we've been migrating more to BEK (hardwood) over the years. We've done a lot of reformulation to find the right bundle of pulp at a favorable cost. There have been improvements in BEK that allow it to substitute for NBSK. We have some flex in some brands and can move between the two depending on the arbitrage. We tend to operate in a 60/40 mix range between the two.
Q: Reading local press, it sounds like the TAD site is locked in. Is that the case, or is there still competitive tension between sites in the Western U.S.? A: Dino Bianco, CEO: Nothing's locked in until we tell you it's locked in. There are always rumors out there. We continue to look at various sites. We do have a lead site we work with, but there are other sites that meet our criteria. Nothing is final until you hear it from us.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
