KP Tissue Inc.

Q2 2026 revenue was $550.9 million, up 2.8% year over year, and adjusted EBITDA was $90.6 million, up 25% year over year. Net income was $22.1 million, comparable to Q2 2025. Consumer revenue rose 1.9% to $457.6 million, while Away-From-Home revenue increased 7.4% to $93.3 million. Consumer adjusted EBITDA was $85.3 million with an 18.6% margin, and AFH adjusted EBITDA was $8.5 million with a 9.1% margin. Cash at quarter-end was $165.2 million versus $205.9 million at the end of Q1 2026, total debt was stable, leverage was 2.9x, and Q2 capex was $15.5 million. For 2026, capex is expected to be $90 million to $110 million. Management said Q3 2026 adjusted EBITDA is expected to be in the range of Q2 2026.

Dino Bianco said the company maintained strong momentum in Q2 despite an uncertain economic backdrop, helped by higher U.S. sales volume, lower pulp prices, and improving Memphis performance. He emphasized continued investment in brands, a second-half Canadian share recovery plan, and progress on the Western U.S. TAD facility. His tone was constructive but cautious, especially on Canadian consumer softness, tariffs, and the timing of the new U.S. mill project.

Michael Keays focused on the quarter’s financial improvement: adjusted EBITDA of $90.6 million on $550.9 million of sales, with margin expanding to 16.4% from 13.5% a year ago. He said the EBITDA increase was driven by Memphis mill performance, higher volume, and lower pulp prices, partly offset by freight and SG&A pressure. He also highlighted cash of $165.2 million, stable debt, 2.9x leverage, Q2 capex of $15.5 million, and full-year capex guidance of $90 million to $110 million including pre-engineering for the U.S. TAD extension.

Analysts focused on three themes: the Canadian share recovery plan, Memphis ramp benefits, and the timing and structure of the Western U.S. TAD project. Management said the share recovery will rely on price gap corrections, category management, added promotions, and better communication around product value, and that benefits were already starting to show in June. On Memphis, Dino said the site likely has another year before reaching maturity, with further upside from normalized maintenance and possible capacity additions. On TAD, he said the company is still doing due diligence on a greenfield site and wants more clarity on the macro backdrop before making a final decision, though he hopes to provide clarity before year-end.