Cascades reported lower first-quarter profitability as softer packaging demand, higher logistics costs and operational disruptions weighed on performance in early 2026.
The Québec-based packaging and tissue producer posted sales of $1.125 billion for the quarter ended March 31, down from $1.154 billion a year earlier. Adjusted EBITDA reached $118 million, compared with $125 million in the first quarter of 2025, while adjusted net earnings fell to $7 million, or $0.07 per share.
Operating income improved to $81 million from $50 million a year earlier, supported in part by gains tied to asset sales. Net earnings totaled $39 million, or $0.38 per share.
President and CEO Hugues Simon said results came in below the company’s initial expectations, citing weather-related disruptions across the United States, transportation and fuel cost volatility, and weaker consumer spending that reduced packaging volumes. Temporary execution issues during the second half of the quarter also affected performance.
The Packaging Products segment generated sales of $715 million, down from $762 million a year earlier, while segment EBITDA declined to $103 million from $109 million. Tissue Papers sales rose to $380 million from $364 million, though EBITDA slipped to $33 million from $37 million.
Cascades said higher selling prices and a favourable sales mix partially offset increased logistics, production and energy costs during the quarter. Lower packaging volumes and unfavourable foreign exchange effects also weighed on results.
The company generated $91 million from asset sales during the quarter, bringing total proceeds since 2025 to $149 million as part of its broader objective to generate $230 million through disposals by the end of the third quarter of 2026.
Looking ahead, Cascades expects second-quarter results to be modestly lower sequentially as consumer spending remains restrained and input cost pressures continue. The company said announced price increases in packaging and tissue are expected to help offset these headwinds later in the year.
Management also reiterated its goal of generating $100 million in profitability improvements by the end of 2026 through cost reductions, logistics optimization and productivity initiatives.
Cascades maintained its net debt-to-EBITDA ratio at 3.3x at the end of the quarter.
Founded in 1964, Cascades produces packaging, tissue and recycling solutions across North America. The company operates 61 facilities and employs approximately 8,800 people.
