Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Oct. 29, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-34056 | |
Entity Registrant Name | VERSO CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 75-3217389 | |
Entity Address, Address Line One | 8540 Gander Creek Drive | |
Entity Address, City or Town | Miamisburg | |
Entity Address, State or Province | OH | |
Entity Address, Postal Zip Code | 45342 | |
City Area Code | 877 | |
Local Phone Number | 855-7243 | |
Title of 12(b) Security | Class A common stock, par value $0.01 per share | |
Trading Symbol | VRS | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Bankruptcy Proceedings, Reporting Current | true | |
Entity Common Stock, Class A, Shares Outstanding | 29,062,302 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 0001421182 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 166 | $ 137 |
Accounts receivable, net | 112 | 83 |
Inventories | 141 | 224 |
Assets held for sale | 6 | 17 |
Prepaid expenses and other assets | 8 | 5 |
Total current assets | 433 | 466 |
Property, plant and equipment, net | 513 | 613 |
Deferred tax assets | 151 | 122 |
Intangibles and other assets, net | 37 | 44 |
Total assets | 1,134 | 1,245 |
Current liabilities: | ||
Accounts payable | 115 | 80 |
Accrued and other liabilities | 84 | 92 |
Current maturities of long-term debt and finance leases | 2 | 1 |
Total current liabilities | 201 | 173 |
Long-term debt and finance leases | 3 | 4 |
Pension benefit obligation | 308 | 350 |
Other long-term liabilities | 39 | 34 |
Total liabilities | 551 | 561 |
Commitments and contingencies (Note 11) | ||
Equity: | ||
Preferred stock -- par value $0.01 (50,000,000 shares authorized, no shares issued) | 0 | 0 |
Common stock -- par value $0.01 (210,000,000 Class A shares authorized with 35,877,533 shares issued and 33,133,649 outstanding on December 31, 2020 and 33,260,987 shares issued and 29,062,302 outstanding on September 30, 2021; 40,000,000 Class B shares authorized with no shares issued and outstanding on December 31, 2020 and September 30, 2021) | 0 | 0 |
Treasury stock -- at cost (2,743,884 shares on December 31, 2020 and 4,198,685 shares on September 30, 2021) | (62) | (39) |
Paid-in-capital | 652 | 705 |
Retained deficit | (67) | (42) |
Accumulated other comprehensive income | 60 | 60 |
Total equity | 583 | 684 |
Total liabilities and equity | $ 1,134 | $ 1,245 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Treasury stock, shares (in shares) | 4,198,685 | 2,743,884 |
Class A | ||
Common stock, shares authorized (in shares) | 210,000,000 | 210,000,000 |
Common shares issued (in shares) | 33,260,987 | 35,877,533 |
Common stock, shares outstanding (in shares) | 29,062,302 | 33,133,649 |
Common Class B | ||
Common stock, shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common shares issued (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 0 | 0 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Net sales | $ 339 | $ 306 | $ 950 | $ 1,045 |
Costs and expenses: | ||||
Cost of products sold (exclusive of depreciation and amortization) | 274 | 309 | 810 | 1,007 |
Depreciation and amortization | 18 | 21 | 137 | 66 |
Selling, general and administrative expenses | 19 | 19 | 54 | 62 |
Restructuring charges | 0 | (2) | 17 | 4 |
Other operating (income) expense | (7) | 3 | (5) | (84) |
Operating income (loss) | 35 | (44) | (63) | (10) |
Interest expense | 0 | 1 | 1 | 1 |
Other (income) expense | (6) | (5) | (19) | (14) |
Income (loss) before income taxes | 41 | (40) | (45) | 3 |
Income tax expense (benefit) | (17) | (9) | (29) | 14 |
Net income (loss) | $ 58 | $ (31) | $ (16) | $ (11) |
Income (loss) per common share: | ||||
Basic (usd per share) | $ 1.98 | $ (0.92) | $ (0.53) | $ (0.33) |
Diluted (usd per share) | $ 1.96 | $ (0.92) | $ (0.53) | $ (0.33) |
Weighted average common shares outstanding (in thousands) | ||||
Basic (shares) | 29,334 | 33,675 | 31,476 | 34,440 |
Diluted (shares) | 29,605 | 33,675 | 31,476 | 34,440 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 58 | $ (31) | $ (16) | $ (11) |
Defined benefit pension plan: | ||||
Pension liability adjustment, net | 0 | (119) | 0 | (119) |
Other comprehensive income (loss), net of tax | 0 | (119) | 0 | (119) |
Comprehensive income (loss) | $ 58 | $ (150) | $ (16) | $ (130) |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Millions | Total | Class A | Common StockClass A | Treasury Stock | Paid-in-Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Income (Loss) |
Common shares beginning balance (in shares) at Dec. 31, 2019 | 34,949,000 | ||||||
Treasury shares beginning balance (in shares) at Dec. 31, 2019 | 245,000 | ||||||
Beginning balance at Dec. 31, 2019 | $ 987 | $ 0 | $ (5) | $ 698 | $ 172 | $ 122 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (11) | (11) | |||||
Treasury shares (in shares) | 1,858,000 | ||||||
Treasury shares | (27) | $ (27) | |||||
Other comprehensive income (loss), net of tax | (119) | (119) | |||||
Common stock issued for restricted stock (in shares) | 841,000 | ||||||
Dividends and dividend equivalents declared | (108) | 2 | (110) | ||||
Equity award expense | 5 | 5 | |||||
Common shares ending balance (in shares) at Sep. 30, 2020 | 35,790,000 | ||||||
Treasury shares ending balance (in shares) at Sep. 30, 2020 | 2,103,000 | ||||||
Ending balance at Sep. 30, 2020 | 727 | $ 0 | $ (32) | 705 | 51 | 3 | |
Common shares beginning balance (in shares) at Jun. 30, 2020 | 35,766,000 | ||||||
Treasury shares beginning balance (in shares) at Jun. 30, 2020 | 2,097,000 | ||||||
Beginning balance at Jun. 30, 2020 | 981 | $ 0 | $ (32) | 702 | 189 | 122 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (31) | (31) | |||||
Treasury shares (in shares) | 6,000 | ||||||
Other comprehensive income (loss), net of tax | (119) | (119) | |||||
Common stock issued for restricted stock (in shares) | 24,000 | ||||||
Dividends and dividend equivalents declared | (105) | 2 | (107) | ||||
Equity award expense | 1 | 1 | |||||
Common shares ending balance (in shares) at Sep. 30, 2020 | 35,790,000 | ||||||
Treasury shares ending balance (in shares) at Sep. 30, 2020 | 2,103,000 | ||||||
Ending balance at Sep. 30, 2020 | $ 727 | $ 0 | $ (32) | 705 | 51 | 3 | |
Common shares beginning balance (in shares) at Dec. 31, 2020 | 35,877,533 | 35,878,000 | |||||
Treasury shares beginning balance (in shares) at Dec. 31, 2020 | 2,743,884 | 2,744,000 | |||||
Beginning balance at Dec. 31, 2020 | $ 684 | $ 0 | $ (39) | 705 | (42) | 60 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (16) | (16) | |||||
Treasury shares (in shares) | 1,455,000 | ||||||
Treasury shares | (23) | $ (23) | |||||
Other comprehensive income (loss), net of tax | 0 | ||||||
Common stock issued for restricted stock (in shares) | 423,000 | ||||||
Dividends and dividend equivalents declared | (9) | (9) | |||||
Repurchase of common stock (in shares) | (3,040,000) | ||||||
Repurchase of common stock | (56) | (56) | |||||
Equity award expense | $ 3 | 3 | |||||
Common shares ending balance (in shares) at Sep. 30, 2021 | 33,260,987 | 33,261,000 | |||||
Treasury shares ending balance (in shares) at Sep. 30, 2021 | 4,198,685 | 4,199,000 | |||||
Ending balance at Sep. 30, 2021 | $ 583 | $ 0 | $ (62) | 652 | (67) | 60 | |
Common shares beginning balance (in shares) at Jun. 30, 2021 | 33,207,000 | ||||||
Treasury shares beginning balance (in shares) at Jun. 30, 2021 | 3,588,000 | ||||||
Beginning balance at Jun. 30, 2021 | 539 | $ 0 | $ (50) | 651 | (122) | 60 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | 58 | 58 | |||||
Treasury shares (in shares) | 611,000 | ||||||
Treasury shares | (12) | $ (12) | |||||
Other comprehensive income (loss), net of tax | 0 | ||||||
Common stock issued for restricted stock (in shares) | 54,000 | ||||||
Dividends and dividend equivalents declared | (3) | (3) | |||||
Equity award expense | $ 1 | 1 | |||||
Common shares ending balance (in shares) at Sep. 30, 2021 | 33,260,987 | 33,261,000 | |||||
Treasury shares ending balance (in shares) at Sep. 30, 2021 | 4,198,685 | 4,199,000 | |||||
Ending balance at Sep. 30, 2021 | $ 583 | $ 0 | $ (62) | $ 652 | $ (67) | $ 60 |
UNAUDITED CONDENSED CONSOLIDA_6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash Flows From Operating Activities: | ||
Net income (loss) | $ (16) | $ (11) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 137 | 66 |
Noncash restructuring charges | 8 | 0 |
Net periodic pension cost (income) | (17) | (12) |
Pension plan contributions | (25) | (47) |
Amortization of debt issuance cost | 1 | 0 |
Equity award expense | 3 | 5 |
Gain on Sale of Androscoggin/Stevens Point Mills | 0 | (88) |
Loss on Sale of Duluth Mill | 3 | 0 |
(Gain) loss on sale or disposal of assets | 0 | 3 |
Gain on insurance recoveries | (6) | 0 |
Deferred taxes | (29) | 14 |
Changes in assets and liabilities: | ||
Accounts receivable, net | (29) | 9 |
Inventories | 79 | (10) |
Prepaid expenses and other assets | (3) | 0 |
Accounts payable | 27 | (46) |
Accrued and other liabilities | 0 | (12) |
Net cash provided by (used in) operating activities | 133 | (129) |
Cash Flows From Investing Activities: | ||
Proceeds from sale of assets | 1 | 1 |
Capital expenditures | (38) | (43) |
Net proceeds from Sale of Androscoggin/Stevens Point Mills | 0 | 338 |
Net proceeds from Sale of Duluth Mill | 6 | 0 |
Proceeds from insurance recoveries | 6 | 0 |
Recognition of deposits and net proceeds from sale of Luke Mill equipment | 10 | 0 |
Net cash provided by (used in) investing activities | (15) | 296 |
Cash Flows From Financing Activities: | ||
Borrowings on ABL Facility | 0 | 36 |
Payments on ABL Facility | 0 | (36) |
Principal payment on financing lease obligation | (1) | (1) |
Repurchase of common stock | (56) | 0 |
Acquisition of treasury stock | (23) | (27) |
Dividends paid to stockholders | (9) | (108) |
Net cash provided by (used in) financing activities | (89) | (136) |
Change in Cash and cash equivalents and restricted cash | 29 | 31 |
Cash and cash equivalents and restricted cash at beginning of period | 139 | 44 |
Cash and cash equivalents and restricted cash at end of period | 168 | 75 |
Supplemental cash flow disclosures: | ||
Total interest paid | 1 | 0 |
Total income taxes paid | 0 | 0 |
Noncash investing and financing activities: | ||
Right-of-use assets obtained in exchange for new finance lease liabilities | 1 | 0 |
Right-of-use assets obtained in exchange for new capitalized operating lease liabilities | 1 | 7 |
Net right-of-use assets re-measurement | $ 4 | $ 0 |
SUMMARY OF BUSINESS AND BASIS O
SUMMARY OF BUSINESS AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF BUSINESS AND BASIS OF PRESENTATION | SUMMARY OF BUSINESS AND BASIS OF PRESENTATION Nature of Business — Verso is a producer of graphic paper, specialty paper, packaging paper and Northern Bleached Hardwood Kraft, or “NBHK,” pulp. These products are used primarily in media, marketing applications and commercial printing applications. Uses include catalogs, magazines, high-end advertising brochures, direct-mail advertising, and specialty applications, such as labeling and other special applications. NBHK pulp is used to manufacture printing, writing and specialty paper grades, tissue and other products. Verso operates in the pulp and paper market segments primarily in North America (see Note 12). Sale of Androscoggin Mill and Stevens Point Mill — On November 11, 2019, Verso and Verso Paper entered into a membership interest purchase agreement, or the “Purchase Agreement,” with Pixelle Specialty Solution LLC, or “Pixelle,” whereby Verso and Verso Paper agreed to sell to Pixelle, or the “Pixelle Sale,” or “Sale of Androscoggin/Stevens Point Mills,” all of the outstanding membership interests in Verso Androscoggin, LLC an indirect wholly owned subsidiary of Verso and the entity that, as of the closing date of the Pixelle Sale, held all the assets primarily related to Verso’s Androscoggin Mill located in Jay, Maine, and Stevens Point Mill, located in Stevens Point, Wisconsin. The transaction was approved by Verso’s stockholders on January 31, 2020 and closed on February 10, 2020 (see Note 5). Duluth Mill and Wisconsin Rapids Mill — On June 9, 2020, Verso announced plans to indefinitely idle its mills in Duluth, Minnesota and Wisconsin Rapids, Wisconsin, while exploring viable and sustainable alternatives for both mills including restarting, selling or permanently closing one or both mills. Verso’s decision to reduce its production capacity was driven by the accelerated decline in graphic paper demand, primarily resulting from the COVID-19 pandemic. The production capacity of the Duluth Mill was approximately 270,000 tons of supercalendered/packaging paper and the production capacity of the Wisconsin Rapids Mill is approximately 540,000 tons of coated and packaging paper. Verso idled production at the Duluth Mill on July 1, 2020 and at the Wisconsin Rapids Mill on July 27, 2020. On December 31, 2020, Verso decided to permanently shut down the Duluth Mill, which was subsequently sold on May 13, 2021 (see Note 5). On February 8, 2021, Verso decided to permanently shut down the No. 14 paper machine and certain other long-lived assets at the Wisconsin Rapids Mill (see Note 10). Verso continues to operate the facility at the Wisconsin Rapids Mill to convert paper produced at the Quinnesec and Escanaba mills to sheets for the commercial print market. COVID-19 Pandemic — The COVID-19 Pandemic has impacted Verso’s operations and financial results since the first quarter of 2020 and continues to have an impact on the Company. Verso serves as an essential manufacturing business and, as a result, its mills have continued to be operational during the pandemic in order to meet the ongoing needs of its customers, including those in other essential business sectors, which provide food, medical and hygiene products needed in a global health crisis. However, the guidelines and orders enacted by federal, state and local governments impacted demand from retailers, political campaigns, and sports and entertainment events, driving reduced purchases of printed materials and substantially impacting Verso’s graphic paper business. There continues to be significant uncertainties associated with the COVID-19 Pandemic, including with respect to the resurgence of new variants of the virus; or if the vaccines introduced to combat the virus are not effective or public acceptance of such vaccines is not widespread; and the impact of COVID-19 on economic conditions, including with respect to labor market conditions, economic activity, consumer behavior, supply chain shortages and disruptions and inflationary pressure; all of which could have a material impact on the Company’s business, financial position, results of operations and cash flows. While Verso cannot reasonably estimate the full impact of COVID-19 on the business, financial position, results of operations and cash flows, the Company has seen its sales, volume and prices continue to recover during the third quarter of 2021. Basis of Presentation — This report contains the Unaudited Condensed Consolidated Financial Statements of Verso as of December 31, 2020 and September 30, 2021 and for the three and nine months ended September 30, 2020 and 2021. The December 31, 2020 Unaudited Condensed Consolidated Balance Sheet data was derived from audited financial statements, but it does not include all disclosures required annually by accounting principles generally accepted in the United States of America, or “GAAP.” In Verso’s opinion, the Unaudited Condensed Consolidated Financial Statements include all adjustments that are necessary for the fair presentation of Verso’s respective financial condition, results of operations and cash flows for the interim periods presented. Except as disclosed in the notes to the Unaudited Condensed Consolidated Financial Statements, such adjustments are of a normal, recurring nature. Intercompany balances and transactions are eliminated in consolidation. The results of operations and cash flows for the interim periods presented may not necessarily be indicative of full-year |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS Accounting Guidance Adopted in 2021 Accounting Standards Codification Topic 740, Income Taxes . In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update 2019-12, Simplifying the Accounting for Income Taxes , which removes certain exceptions for investments, intraperiod allocations and interim calculations, and adds guidance to reduce the complexity in accounting for income taxes. Verso adopted this guidance on January 1, 2021, and the effect on the Unaudited Condensed Consolidated Financial Statements was not material. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION The following table presents revenue disaggregated by product included on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Paper $ 260 $ 296 $ 900 $ 835 Packaging 14 8 56 21 Pulp 32 35 89 94 Total Net sales $ 306 $ 339 $ 1,045 $ 950 The following table presents revenue disaggregated by sales channel included on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 End-users and Converters $ 95 $ 104 $ 375 $ 290 Brokers and Merchants 150 174 477 502 Printers 61 61 193 158 Total Net sales $ 306 $ 339 $ 1,045 $ 950 |
SUPPLEMENTAL FINANCIAL STATEMEN
SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION | SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION Restricted Cash — As of December 31, 2020 and September 30, 2021, $2 million of restricted cash was included in Intangibles and other assets, net on the Unaudited Condensed Consolidated Balance Sheets primarily related to asset retirement obligations in the state of Michigan. These cash deposits are required by the state and may only be used for the future closure of a landfill. As of both September 30, 2020 and 2021, Cash and cash equivalents and restricted cash on the Unaudited Condensed Consolidated Statements of Cash Flows includes restricted cash of $2 million. Inventories — The following table summarizes inventories by major category: December 31, September 30, (Dollars in millions) 2020 2021 Raw materials $ 45 $ 34 Work-in-process 31 19 Finished goods 125 71 Replacement parts and other supplies 23 17 Inventories $ 224 $ 141 Property, plant and equipment — Depreciation expense for the three and nine months ended September 30, 2020 was $20 million and $62 million, respectively. Depreciation expense for three and nine months ended September 30, 2021 was $17 million and $134 million, respectively. Depreciation expense for the nine months ended September 30, 2021 includes $84 million in accelerated depreciation associated with the permanent shutdown of the No. 14 paper machine and certain other long-lived assets at the Wisconsin Rapids Mill (see Note 10). Property, plant and equipment as of September 30, 2020 and 2021 include $2 million and $11 million, respectively, of capital expenditures that were unpaid and included in Accounts payable and Accrued and other liabilities on the Unaudited Condensed Consolidated Balance Sheets. Income Taxes — Income tax benefit for the three months ended September 30, 2020 was $9 million and income tax expense for the nine months ended September 30, 2020 was $14 million. Income tax benefit for the three and nine months ended September 30, 2021 was $17 million and $29 million, respectively. During the three and nine months ended September 30, 2020, Verso recognized $1 million and $8 million, respectively, of additional valuation allowance against state tax credits. During the three months ended September 30, 2021, Verso reduced the valuation allowance against state tax credits by $2 million. During the nine months ended September 30, 2021, the net additional valuation allowance against state tax credits was $2 million. The Company’s income tax provision for interim periods is determined through the use of an estimated annual effective tax rate applied to year-to-date ordinary income/loss plus or minus the tax effects of discrete items. The Company’s estimated annual effective tax rate benefit is higher than statutory rates primarily due to the effect of forecasted pretax book income and permanent items impacting the forecasted rate such as portions of executive compensation and other expenses that are not fully deductible for tax. Related Party Transactions — Net sales for the three and nine months ended September 30, 2021, include sales to a related party of $18 million and $51 million, respectively. Accounts receivable as of December 31, 2020 and September 30, 2021, include $4 million and $6 million, respectively, associated with this related party. |
DISPOSITIONS
DISPOSITIONS | 9 Months Ended |
Sep. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISPOSITIONS | DISPOSITIONS Sale of Androscoggin Mill and Stevens Point Mill On February 10, 2020, Verso completed the Pixelle Sale, selling all of the outstanding membership interests in Verso Androscoggin, LLC, an indirect wholly owned subsidiary of Verso and the entity that, as of the closing date of the Pixelle Sale, held all the assets primarily related to Verso’s Androscoggin Mill located in Jay, Maine and Verso’s Stevens Point Mill, located in Stevens Point, Wisconsin. The Pixelle Sale did not qualify as a discontinued operation. As consideration for the Pixelle Sale, Verso received $352 million in cash, which reflected certain adjustments related to Verso’s estimates of cash, indebtedness and working capital of Verso Androscoggin, LLC and Pixelle assumed $37 million of Verso’s unfunded pension liabilities, which reflected certain adjustments in connection with the completed transfer of the unfunded pension liabilities during the year ended December 31, 2020. During the nine months ended September 30, 2020, Verso received $338 million in net cash proceeds from the Pixelle Sale, consisting of $344 million in cash reduced by $6 million in selling costs and recognized an $88 million gain on the sale. In connection with the Pixelle Sale, Verso provided certain transition services to Pixelle and recognized $2 million and $5 million for these services during the three and nine months ended September 30, 2020, respectively, on the Unaudited Condensed Consolidated Statements of Operations. During the three months ended September 30, 2020, $1 million of these transition services was recognized as a reduction of Cost of products sold and $1 million was recognized as a reduction of Selling, general and administrative expenses. During the nine months ended September 30, 2020, $2 million of these transition services was recognized as a reduction Cost of products sold and $3 million was recognized as a reduction of Selling, general and administrative expenses. These transition services were completed in October 2020. Luke Mill Equipment and Other Asset Sales On August 1, 2020, Verso entered into an equipment purchase agreement with Halkali Kagit Karton Sanayi ve Tic. A.S., or the “Purchaser,” a company organized under the laws of Turkey, whereby Verso agreed to sell, and the Purchaser agreed to purchase, certain equipment at Verso’s Luke Mill, primarily including two paper machines. The purchase price was $11 million in cash due at various milestones. As of September 30, 2021, Verso has received $11 million in non-refundable deposits associated with this sale which includes $1 million in the first quarter of 2021, $1 million in the second quarter of 2021 and the final payment of $1 million in the third quarter of 2021. Management determined that the control over the use of the acquired assets had transferred to the Purchaser and correspondingly recognized the sale of the two paper machines and related assets in June 2021. Verso is exploring options for disposal of the remaining assets of the Luke Mill. As of December 31, 2020 and September 30, 2021, Verso classified $17 million and $6 million, respectively, in Assets held for sale on the Unaudited Condensed Consolidated Balance Sheets. Sale of Duluth Mill On May 13, 2021, Verso Minnesota Wisconsin LLC, an indirect wholly owned subsidiary of Verso, entered into an asset purchase agreement with ST Paper 1, LLC and sold all of the assets primarily related to Verso’s Duluth Mill located in Duluth, Minnesota for $7 million in cash, less costs to sell of $1 million. The sale, including related selling costs, resulted in a loss of $3 million, which is included in Other operating (income) expense on the Unaudited Condensed Consolidated Statement of Operations for the nine months ended September 30, 2021. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT As of December 31, 2020 and September 30, 2021, Verso Paper had no outstanding borrowings on its ABL Facility (as defined below). ABL Facility Verso Paper is the borrower under a $200 million asset-based revolving credit facility, or the “ABL Facility.” From February 6, 2019 until May 10, 2021, the ABL Facility provided for revolving commitments of $350 million, with a $100 million sublimit for letters of credit and a $35 million sublimit for swingline loans. During this time, Verso Paper could request one or more incremental revolving commitments in an aggregate principal amount up to the greater of (i) $75 million or (ii) the excess of the borrowing base over the revolving facility commitments of $350 million; however, the lenders were not obligated to increase the revolving commitments upon any such request. On May 10, 2021, Verso Paper entered into a third amendment to the ABL Facility, or the “Third ABL Amendment.” As a result of the Third ABL Amendment, the ABL Facility provides for revolving commitments of $200 million, with a $75 million sublimit for letters of credit and a $20 million sublimit for swingline loans. The amount of borrowings and letters of credit available to Verso Paper pursuant to the ABL Facility is limited to the lesser of $200 million or an amount determined pursuant to a borrowing base ($141 million as of September 30, 2021). As of September 30, 2021, there were no borrowings outstanding under the ABL Facility, with $21 million issued in letters of credit and $120 million available for future borrowings. Availability under the ABL Facility is subject to customary borrowing conditions. The ABL Facility will mature on February 6, 2024. Outstanding borrowings under the ABL Facility bear interest at an annual rate equal to, at the option of Verso Paper, either (i) a customary London interbank offered rate plus an applicable margin ranging from 1.25% to 1.75% or (ii) the Federal Funds Rate plus an applicable margin ranging from 0.25% to 0.75%, determined based upon the average excess availability under the ABL Facility. Verso Paper is also required to pay a commitment fee for the unused portion of the ABL Facility of 0.25% per year, based upon the average revolver usage under the ABL Facility. The ABL Facility provides for determination of a benchmark replacement interest rate when LIBOR is no longer available, subject to the terms, and upon the satisfaction of conditions, specified therein. All obligations under the ABL Facility are unconditionally guaranteed by Verso Holding and certain of the subsidiaries of Verso Paper. The ABL Facility is secured by a first-priority lien on certain assets of Verso Paper, Verso Holding and the other guarantor subsidiaries, including accounts receivable, inventory, certain deposit accounts, securities accounts and commodities accounts. The ABL Facility contains financial covenants requiring Verso, among other things, to maintain a minimum fixed charge coverage ratio if availability were to drop below prescribed thresholds. The ABL Facility also requires that certain payment |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table provides a reconciliation of basic and diluted income (loss) per common share: Three Months Ended Nine Months Ended September 30, September 30, 2020 2021 2020 2021 Net income (loss) available to common stockholders (in millions) $ (31) $ 58 $ (11) $ (16) Weighted average common shares outstanding - basic (in thousands) 33,675 29,334 34,440 31,476 Dilutive shares from stock awards (in thousands) — 271 — — Weighted average common shares outstanding - diluted (in thousands) 33,675 29,605 34,440 31,476 Basic income (loss) per share $ (0.92) $ 1.98 $ (0.33) $ (0.53) Diluted income (loss) per share $ (0.92) $ 1.96 $ (0.33) $ (0.53) As a result of the net loss from continuing operations for the three and nine months ended September 30, 2020 and the nine months ended September 30, 2021, 0.9 million restricted stock units as of September 30, 2020 and 0.8 million restricted stock units as of September 30, 2021 were excluded from the calculations of diluted earnings per share for such periods as their inclusion would be anti-dilutive. As of September 30, 2020 and 2021, Verso had 1.8 million warrants outstanding at an adjusted exercise price per share of $21.67 and $20.66, respectively (see Note 9). As a result of the exercise price of the warrants exceeding the average market price of Verso’s common stock during the three and nine months ended September 30, 2020 and 2021, 2.3 million and 2.4 million shares, respectively, were excluded from the calculations of diluted earnings per share as their inclusion would be anti-dilutive. |
RETIREMENT BENEFITS
RETIREMENT BENEFITS | 9 Months Ended |
Sep. 30, 2021 | |
Retirement Benefits [Abstract] | |
RETIREMENT BENEFITS | RETIREMENT BENEFITS The following table summarizes the components of net periodic pension cost (income) for the periods presented: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Service cost $ 1 $ — $ 2 $ 1 Interest cost 12 10 35 29 Expected return on plan assets (17) (16) (50) (47) Settlement 1 — 1 — Net periodic pension cost (income) $ (3) $ (6) $ (12) $ (17) Verso makes contributions to its pension plan that are sufficient to fund actuarially determined costs, generally equal to the minimum amounts required by the Employee Retirement Income Security Act. Contributions to the pension plan during the three and nine months ended September 30, 2020 were $29 million and $47 million, respectively. Contributions to the pension plan during the three and nine months ended September 30, 2021 were $9 million and $25 million, respectively. On March 11, 2021, the government signed into law the American Rescue Plan Act of 2021, or “ARPA.” The ARPA provides for pension funding relief that reduced Verso’s 2021 required cash contributions to its pension plan to $25 million from $46 million. Verso is not required to make any contributions to the pension plan in the remainder of 2021. |
EQUITY
EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
EQUITY | EQUITY Equity Awards During the nine months ended September 30, 2021, Verso granted 0.3 million time-based restricted stock units and 0.2 million performance-based restricted stock units to its executives and certain senior managers. The performance-based restricted stock unit awards granted vest on the performance determination date following the end of the performance period, as measured using an adjusted EBITDAP (earnings before interest, taxes, depreciation, amortization and pension expense/income) metric and a return on invested capital metric over a 3-year period ending December 31, 2023. The vesting criteria of the performance-based restricted stock unit awards meet the definition of a performance condition for accounting purposes. The number of shares which will ultimately vest at the vesting date ranges from 0% to 200% of the number of performance-based restricted stock units granted based on performance during the 3-year cumulative performance period. The compensation expense associated with these performance awards is currently estimated at 100%. On March 5, 2021, Verso modified certain outstanding restricted stock unit awards as part of a retention arrangement for its former Chief Financial Officer who retired on June 30, 2021. As modified, his performance-based restricted stock units will remain outstanding and may vest on a pro-rata basis based on Verso’s achievement of established targets. In addition, the next tranche of his time-based restricted stock units vested at June 30, 2021. The foregoing changes were considered a modification and resulted in a revaluation of his 2019 and 2020 performance-based restricted stock units to a fair value of $0.67 and $8.66, respectively, and a revaluation of each of his 2018, 2019 and 2020 time-based restricted stock units that vested as a result of the modification to a fair value of $13.32. Verso recognized equity award expense of $1 million and $5 million for the three and nine months ended September 30, 2020, respectively, and $1 million and $3 million for the three and nine months ended September 30, 2021, respectively. As of September 30, 2021, there was approximately $6 million of unrecognized compensation cost related to the 0.8 million non-vested restricted stock units, which is expected to be recognized over the weighted average period of 2.0 years. Time-based Restricted Stock Units Changes to non-vested time-based restricted stock units for the nine months ended September 30, 2021 were as follows: Restricted Stock Weighted Average Units Grant Date Shares (in thousands) Outstanding Fair Value Non-vested at December 31, 2020 421 $ 9.95 Granted (1) 269 13.85 Vested (265) 9.53 Forfeited (73) 11.85 Non-vested at September 30, 2021 (2) 352 13.36 (1) Includes 7 thousand dividend equivalent units on certain time-based restricted stock unit awards for dividends related to the stock units granted but not yet vested at the time cash dividends were paid. (2) Includes the modified value of the time-based restricted stock units associated with the retention agreement for the former Chief Financial Officer. Performance-based Restricted Stock Units Changes to non-vested performance-based restricted stock units for the nine months ended September 30, 2021 were as follows: Restricted Stock Weighted Average Units Grant Date Shares (in thousands) Outstanding Fair Value Non-vested at December 31, 2020 424 $ 12.21 Granted (1) 214 12.88 Incremental shares vested (2) 10 — Vested (143) 12.85 Forfeited (77) 10.59 Non-vested at September 30, 2021 (3) 428 11.30 (1) Includes 8 thousand dividend equivalent units on certain performance-based restricted stock unit awards for dividends related to the stock units granted but not yet vested at the time cash dividends were paid. (2) Incremental shares are a result of performance at 113% of the target level of shares subject to the performance-based restricted stock units. (3) Includes the modified value of the performance-based restricted stock units associated with the retention agreement for the former Chief Financial Officer. Share Repurchase Authorization and Dividends On February 26, 2020, Verso’s Board of Directors authorized up to $250 million of net proceeds from the Pixelle Sale to be used to repurchase outstanding shares of Verso common stock. In conjunction with the declaration of the special cash dividend of $3.00 per share, or $101 million, on August 5, 2020, Verso’s Board of Directors reduced Verso’s total share repurchase authorization from $250 million to $150 million. During the nine months ended September 30, 2020, Verso purchased under its share repurchase authorization approximately 1.6 million of its common stock through open market purchases and 10b5-1 programs at a weighted average cost of $14.14 per share. During the nine months ended September 30, 2021, Verso purchased under its share repurchase authorization (i) approximately 1.3 million shares of its common stock through open market purchases and 10b5-1 programs at a weighted average cost of $15.97 per share and (ii) approximately 3.0 million shares at a purchase price of $18.10 per share through the modified Dutch auction tender offer discussed below. As of September 30, 2021, $45 million of the $150 million share repurchase authorization remained. On May 13, 2021, Verso commenced a modified Dutch auction tender offer to purchase for cash shares of its common stock for an aggregate purchase price of not more than $55 million and at a price per share of common stock of not less than $16.00 and not more than $18.30 per share. The tender offer expired on June 10, 2021. Through the tender offer, Verso accepted for purchase approximately 3.0 million shares of its common stock at a purchase price of $18.10 per share for an aggregate purchase price of approximately $56 million, including fees and expenses. The shares of common stock purchased through the tender offer were immediately retired. The excess purchase price over par value was recorded as a reduction to Paid-in capital on the Unaudited Condensed Consolidated Balance Sheet during the second quarter of 2021. On February 5, 2021, Verso’s Board of Directors declared a quarterly cash dividend of $0.10 per share of Verso's common stock, which was paid on March 29, 2021, to stockholders of record on March 18, 2021. On May 7, 2021, Verso’s Board of Directors declared a quarterly cash dividend of $0.10 per share of Verso’s common stock, which was paid on June 29, 2021, to stockholders of record on June 17, 2021. On August 6, 2021, Verso’s Board of Directors declared a quarterly cash dividend of $0.10 per share of Verso’s common stock, which was paid on September 28, 2021, to stockholders of record on September 17, 2021. On November 4, 2021, Verso’s Board of Directors declared a quarterly cash dividend of $0.10 per share of Verso’s common stock, payable on December 29, 2021, to stockholders of record on December 17, 2021. Verso commenced paying quarterly dividends in the second quarter of 2020. Warrants On July 15, 2016, warrants to purchase up to an aggregate of 1.8 million shares of Class A common stock were issued to holders of first-lien secured debt at an initial exercise price of $27.86 per share and a seven-year term, subject to customary anti-dilution adjustments. As a result of Verso’s various share repurchases, including the modified Dutch auction tender offer, and dividend payments since the issuance of the warrants, as of September 30, 2021, the number of shares of Verso common stock issuable upon exercise of each warrant increased to 1.35 shares of common stock, for an aggregate of approximately 2.4 million shares of common stock, and the warrant exercise price was reduced to $20.66 per share. If all warrants were exercised, Verso would issue 2.4 million shares of Class A common stock and receive $50 million in proceeds. The warrants expire on July 15, 2023. As of September 30, 2021, no warrants have been exercised. |
RESTRUCTURING CHARGES
RESTRUCTURING CHARGES | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING CHARGES | RESTRUCTURING CHARGES Wisconsin Rapids Mill - On February 8, 2021, Verso decided to permanently shut down the No. 14 paper machine and certain other long-lived assets at its paper mill in Wisconsin Rapids, Wisconsin, while continuing to explore viable and sustainable alternatives with the remaining assets, including its converting operation, No. 16 paper machine and other remaining long-lived assets. This decision was made in response to the continued accelerated decline in printing and writing paper demand. The decision to permanently shut down the No. 14 paper machine and certain other long-lived assets, which have been idle since July 2020, permanently reduced Verso’s total annual production capacity by approximately 185,000 tons of coated paper. In connection with the permanent shutdown of the No. 14 paper machine at the Wisconsin Rapids Mill, Verso recognized $84 million of accelerated depreciation which is included in Depreciation and amortization on the Unaudited Condensed Consolidated Statement of Operations for the nine months ended September 30, 2021. The following table details the charges incurred related to the shutdown of No. 14 paper machine and certain other long-lived assets as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended Cumulative (Dollars in millions) September 30, 2021 September 30, 2021 Incurred Property, plant and equipment, net $ — $ 5 $ 5 Write-off of spare parts and inventory — 3 3 Total restructuring costs $ — $ 8 $ 8 Duluth Mill — On December 31, 2020, Verso decided to permanently shut down the paper mill in Duluth, Minnesota while continuing with efforts to sell the mill. Management’s decision to permanently shut down the Duluth Mill was made in response to the continued accelerated decline in printing and writing paper demand resulting from the COVID-19 pandemic. The closure of the Duluth Mill, which had been idle since July 2020, reduced Verso’s total annual production capacity by approximately 270,000 tons of supercalendered/packaging paper. In May 2021, Verso completed the sale of the Duluth Mill (see Note 5). The following table details the charges incurred related to the Duluth Mill closure as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended Cumulative (Dollars in millions) September 30, 2021 September 30, 2021 Incurred Property, plant and equipment, net $ — $ — $ 3 Severance and benefit costs — — 1 Write-off of spare parts and inventory — — 2 Write-off of purchase obligations and commitments — 7 8 Other costs — 2 2 Total restructuring costs $ — $ 9 $ 16 The following table details the changes in the restructuring reserve liabilities related to the permanent shutdown of the Duluth Mill which are included in Accrued and other liabilities on the Unaudited Condensed Consolidated Balance Sheet: Nine Months Ended (Dollars in millions) September 30, 2021 Beginning balance of reserve $ 2 Severance and benefit payments (1) Purchase obligations 7 Other costs 2 Payments on other costs (2) Ending balance of reserve $ 8 Closure of Luke Mill — On April 30, 2019, Verso announced that it would permanently shut down its paper mill in Luke, Maryland in response to the continuing decline in customer demand for the grades of coated freesheet paper produced at the Luke Mill, along with rising input costs, a significant influx of imports and rising compliance costs and infrastructure challenges associated with environmental regulation. Verso completed the shutdown and closure of the Luke Mill in June 2019, which reduced Verso’s coated freesheet production capacity by approximately 450,000 tons and eliminated approximately 675 positions. The following table details the charges incurred related to the Luke Mill closure as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, Cumulative (Dollars in millions) 2020 2021 2020 2021 Incurred Property, plant and equipment, net $ — $ — $ — $ — $ 10 Severance and benefit costs — — (1) — 18 Write-off of spare parts and inventory — — — — 9 Write-off of purchase obligations and commitments — — — — 1 Other costs (1) (2) — 5 — 19 Total restructuring costs $ (2) $ — $ 4 $ — $ 57 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES General Litigation — Verso is involved from time to time in legal proceedings incidental to the conduct of its business. While any proceeding or litigation has the element of uncertainty, Verso believes that the outcome of any of these lawsuits or claims that are pending or threatened or all of them combined (other than those that cannot be assessed due to their preliminary nature) will not have a material effect on the Unaudited Condensed Consolidated Financial Statements. In November 2019, the state of West Virginia asserted in an administrative enforcement action that three above-ground storage tanks at Verso’s Luke Mill leaked and that Verso had failed to take certain actions to prevent and report the release of pollutants into the North Branch of the Potomac River. In March 2020, the Potomac Riverkeeper Network (“PRKN”) filed a federal lawsuit against Verso alleging the improper handling, storage and disposal of wastes generated at the Luke Mill. In May 2020, Maryland joined the PRKN lawsuit and in July 2020, Maryland obtained dismissal of a lawsuit that it previously had filed with respect to the same facts. The Luke Mill sits on the border of West Virginia and Maryland, and it was closed in June 2019. On April 1, 2021, a consent decree was approved and entered by the court in the federal lawsuit, setting forth the terms agreed by Verso with the PRKN and the Maryland Department of the Environment (“the Department”), to settle the claims by PRKN and the state of Maryland. Pursuant to the consent decree, Verso has agreed to pay an aggregate of $1 million in penalties and fees to the Department and PRKN. Verso has also agreed to reimburse the Department for any future response and oversight costs at the Luke Mill up to a maximum of $25,000 for the first year after the effective date of the consent decree and $20,000 per year thereafter until termination of monitoring oversight under the consent decree. In addition to the penalties and fees paid pursuant to the consent decree, Verso also agreed to continue its ongoing remedial activities at the Luke Mill and to monitor the site for at least three years after completion of its remedial efforts. On September 1, 2021, a consent decree was approved and entered by the circuit court of Mineral County, West Virginia, setting forth the terms agreed by Verso with the West Virginia Department of Environmental Protection (“the Department of Environmental Protection”), to settle the claims by the Department of Environmental Protection. Pursuant to the consent decree, Verso has agreed to pay an aggregate of $650,000 in penalties to the Department of Environmental Protection. In addition to the penalties paid pursuant to the consent decree, Verso also agreed to maintain compliance at the Luke Mill, implement and continue certain remediation actions and abide by certain reporting requirements. As a result of the consent decree approval on April 1, 2021 with respect to the lawsuit filed by PRKN, Verso revised its estimates of costs related to the ongoing environmental remediation and monitoring efforts and recorded $5 million in Cost of products sold on the Unaudited Condensed Consolidated Statement of Operations in the first quarter of 2021. As of September 30, 2021, $7 million of environmental remediation costs are included on the Unaudited Condensed Consolidated Balance Sheet, including $2 million in Accrued and other liabilities and $5 million in Other long-term liabilities. As of December 31, 2020, $5 million of environmental remediation costs, which included the cost related to the consent decrees mentioned above, are included in Accrued and other liabilities on the Unaudited Condensed Consolidated Balance Sheet. In connection with the closure of former idled mills, claims were asserted against Verso relating to certain contractual obligations. Verso recognized zero and $6 million for the three and nine months ended September 30, 2021, respectively, included in Restructuring charges on the Consolidated Statements of Operations, associated with contractual obligations. Verso does not believe the claims are reasonable and will continue to defend its position and does not believe any additional charges will be material. |
INFORMATION BY INDUSTRY SEGMENT
INFORMATION BY INDUSTRY SEGMENT | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
INFORMATION BY INDUSTRY SEGMENT | INFORMATION BY INDUSTRY SEGMENT We have two operating segments, paper and pulp. We previously determined that the operating income (loss) of the pulp segment was immaterial for disclosure purposes. However, as the price for pulp/ton has increased in 2021, we have determined that the pulp segment is material for disclosure purposes as of September 30, 2021. Our paper products are used primarily in media, marketing applications and commercial printing applications. Uses include catalogs, magazines, high-end advertising brochures, direct-mail advertising, and specialty applications, such as labeling and other special applications. Our NBHK pulp is used to manufacture printing, writing and specialty paper grades, tissue and other products. Our assets are utilized across operating segments in an integrated mill system and are not identified by operating segment or reviewed by management on an operating segment basis. We operate primarily in one geographic segment, North America. The following table summarizes the operating segment data: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Net sales (1) Paper $ 274 $ 304 $ 956 $ 856 Pulp $ 32 $ 35 $ 89 $ 94 Total Net sales $ 306 $ 339 $ 1,045 $ 950 Gross margin (exclusive of depreciation and amortization) Paper $ (6) $ 49 $ 36 $ 109 Pulp $ 3 $ 16 $ 2 $ 31 Total Gross margin $ (3) $ 65 $ 38 $ 140 (1) Intersegment sales from the pulp segment to the paper segment of $3 million and $7 million are eliminated from Net sales above for the three and nine months ended September 30, 2020, respectively. Intersegment sales from the pulp segment to the paper segment of $12 million and $17 million are eliminated from the Net sales above for the three and nine months ended September 30, 2021, respectively. |
SUMMARY OF BUSINESS AND BASIS_2
SUMMARY OF BUSINESS AND BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | Nature of Business — |
Basis of Presentation | Basis of Presentation — This report contains the Unaudited Condensed Consolidated Financial Statements of Verso as of December 31, 2020 and September 30, 2021 and for the three and nine months ended September 30, 2020 and 2021. The December 31, 2020 Unaudited Condensed Consolidated Balance Sheet data was derived from audited financial statements, but it does not include all disclosures required annually by accounting principles generally accepted in the United States of America, or “GAAP.” In Verso’s opinion, the Unaudited Condensed Consolidated Financial Statements include all adjustments that are necessary for the fair presentation of Verso’s respective financial condition, results of operations and cash flows for the interim periods presented. Except as disclosed in the notes to the Unaudited Condensed Consolidated Financial Statements, such adjustments are of a normal, recurring nature. Intercompany balances and transactions are eliminated in consolidation. The results of operations and cash flows for the interim periods presented may not necessarily be indicative of full-year |
Recent Accounting Developments | Accounting Guidance Adopted in 2021 Accounting Standards Codification Topic 740, Income Taxes . In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update 2019-12, Simplifying the Accounting for Income Taxes , which removes certain exceptions for investments, intraperiod allocations and interim calculations, and adds guidance to reduce the complexity in accounting for income taxes. Verso adopted this guidance on January 1, 2021, and the effect on the Unaudited Condensed Consolidated Financial Statements was not material. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents revenue disaggregated by product included on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Paper $ 260 $ 296 $ 900 $ 835 Packaging 14 8 56 21 Pulp 32 35 89 94 Total Net sales $ 306 $ 339 $ 1,045 $ 950 The following table presents revenue disaggregated by sales channel included on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 End-users and Converters $ 95 $ 104 $ 375 $ 290 Brokers and Merchants 150 174 477 502 Printers 61 61 193 158 Total Net sales $ 306 $ 339 $ 1,045 $ 950 |
SUPPLEMENTAL FINANCIAL STATEM_2
SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Inventories by Major Category | The following table summarizes inventories by major category: December 31, September 30, (Dollars in millions) 2020 2021 Raw materials $ 45 $ 34 Work-in-process 31 19 Finished goods 125 71 Replacement parts and other supplies 23 17 Inventories $ 224 $ 141 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table provides a reconciliation of basic and diluted income (loss) per common share: Three Months Ended Nine Months Ended September 30, September 30, 2020 2021 2020 2021 Net income (loss) available to common stockholders (in millions) $ (31) $ 58 $ (11) $ (16) Weighted average common shares outstanding - basic (in thousands) 33,675 29,334 34,440 31,476 Dilutive shares from stock awards (in thousands) — 271 — — Weighted average common shares outstanding - diluted (in thousands) 33,675 29,605 34,440 31,476 Basic income (loss) per share $ (0.92) $ 1.98 $ (0.33) $ (0.53) Diluted income (loss) per share $ (0.92) $ 1.96 $ (0.33) $ (0.53) |
RETIREMENT BENEFITS (Tables)
RETIREMENT BENEFITS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | The following table summarizes the components of net periodic pension cost (income) for the periods presented: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Service cost $ 1 $ — $ 2 $ 1 Interest cost 12 10 35 29 Expected return on plan assets (17) (16) (50) (47) Settlement 1 — 1 — Net periodic pension cost (income) $ (3) $ (6) $ (12) $ (17) |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Time-based RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Restricted Stock Units Activity | Changes to non-vested time-based restricted stock units for the nine months ended September 30, 2021 were as follows: Restricted Stock Weighted Average Units Grant Date Shares (in thousands) Outstanding Fair Value Non-vested at December 31, 2020 421 $ 9.95 Granted (1) 269 13.85 Vested (265) 9.53 Forfeited (73) 11.85 Non-vested at September 30, 2021 (2) 352 13.36 (1) Includes 7 thousand dividend equivalent units on certain time-based restricted stock unit awards for dividends related to the stock units granted but not yet vested at the time cash dividends were paid. (2) Includes the modified value of the time-based restricted stock units associated with the retention agreement for the former Chief Financial Officer. |
Performance-based RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Restricted Stock Units Activity | Changes to non-vested performance-based restricted stock units for the nine months ended September 30, 2021 were as follows: Restricted Stock Weighted Average Units Grant Date Shares (in thousands) Outstanding Fair Value Non-vested at December 31, 2020 424 $ 12.21 Granted (1) 214 12.88 Incremental shares vested (2) 10 — Vested (143) 12.85 Forfeited (77) 10.59 Non-vested at September 30, 2021 (3) 428 11.30 (1) Includes 8 thousand dividend equivalent units on certain performance-based restricted stock unit awards for dividends related to the stock units granted but not yet vested at the time cash dividends were paid. (2) Incremental shares are a result of performance at 113% of the target level of shares subject to the performance-based restricted stock units. (3) Includes the modified value of the performance-based restricted stock units associated with the retention agreement for the former Chief Financial Officer. |
RESTRUCTURING CHARGES (Tables)
RESTRUCTURING CHARGES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Charges Incurred as Included in Restructuring Charges | The following table details the charges incurred related to the shutdown of No. 14 paper machine and certain other long-lived assets as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended Cumulative (Dollars in millions) September 30, 2021 September 30, 2021 Incurred Property, plant and equipment, net $ — $ 5 $ 5 Write-off of spare parts and inventory — 3 3 Total restructuring costs $ — $ 8 $ 8 The following table details the charges incurred related to the Duluth Mill closure as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended Cumulative (Dollars in millions) September 30, 2021 September 30, 2021 Incurred Property, plant and equipment, net $ — $ — $ 3 Severance and benefit costs — — 1 Write-off of spare parts and inventory — — 2 Write-off of purchase obligations and commitments — 7 8 Other costs — 2 2 Total restructuring costs $ — $ 9 $ 16 The following table details the charges incurred related to the Luke Mill closure as included in Restructuring charges on the Unaudited Condensed Consolidated Statements of Operations: Three Months Ended Nine Months Ended September 30, September 30, Cumulative (Dollars in millions) 2020 2021 2020 2021 Incurred Property, plant and equipment, net $ — $ — $ — $ — $ 10 Severance and benefit costs — — (1) — 18 Write-off of spare parts and inventory — — — — 9 Write-off of purchase obligations and commitments — — — — 1 Other costs (1) (2) — 5 — 19 Total restructuring costs $ (2) $ — $ 4 $ — $ 57 |
Changes in Restructuring Reserve Liabilities Related to the Closure | The following table details the changes in the restructuring reserve liabilities related to the permanent shutdown of the Duluth Mill which are included in Accrued and other liabilities on the Unaudited Condensed Consolidated Balance Sheet: Nine Months Ended (Dollars in millions) September 30, 2021 Beginning balance of reserve $ 2 Severance and benefit payments (1) Purchase obligations 7 Other costs 2 Payments on other costs (2) Ending balance of reserve $ 8 |
INFORMATION BY INDUSTRY SEGME_2
INFORMATION BY INDUSTRY SEGMENT (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table summarizes the operating segment data: Three Months Ended Nine Months Ended September 30, September 30, (Dollars in millions) 2020 2021 2020 2021 Net sales (1) Paper $ 274 $ 304 $ 956 $ 856 Pulp $ 32 $ 35 $ 89 $ 94 Total Net sales $ 306 $ 339 $ 1,045 $ 950 Gross margin (exclusive of depreciation and amortization) Paper $ (6) $ 49 $ 36 $ 109 Pulp $ 3 $ 16 $ 2 $ 31 Total Gross margin $ (3) $ 65 $ 38 $ 140 (1) Intersegment sales from the pulp segment to the paper segment of $3 million and $7 million are eliminated from Net sales above for the three and nine months ended September 30, 2020, respectively. Intersegment sales from the pulp segment to the paper segment of $12 million and $17 million are eliminated from the Net sales above for the three and nine months ended September 30, 2021, respectively. |
SUMMARY OF BUSINESS AND BASIS_3
SUMMARY OF BUSINESS AND BASIS OF PRESENTATION (Detail) - Other Events, COVID-19 | Sep. 30, 2021T |
Closure of Duluth Mill | Supercalendered/Packaging Papers | |
Segment Reporting Information [Line Items] | |
Number of production capacity | 270,000 |
Idle of Wisconsin Rapids Mill | Coated and Packaging Papers | |
Segment Reporting Information [Line Items] | |
Number of production capacity | 540,000 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | $ 339 | $ 306 | $ 950 | $ 1,045 |
End-users and Converters | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 104 | 95 | 290 | 375 |
Brokers and Merchants | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 174 | 150 | 502 | 477 |
Printers | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 61 | 61 | 158 | 193 |
Paper | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 296 | 260 | 835 | 900 |
Packaging | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 8 | 14 | 21 | 56 |
Pulp | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | $ 35 | $ 32 | $ 94 | $ 89 |
SUPPLEMENTAL FINANCIAL STATEM_3
SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Income Tax Contingency [Line Items] | |||||
Restricted cash, intangibles | $ 2 | $ 2 | $ 2 | $ 2 | $ 2 |
Depreciation expense | 17 | 20 | 134 | 62 | |
Accelerated depreciation recognized | 84 | ||||
Capital expenditures unpaid | 11 | 2 | |||
Income tax expense (benefit) | (17) | (9) | (29) | 14 | |
Affiliated Entity | |||||
Income Tax Contingency [Line Items] | |||||
Revenue from affiliates | 18 | 51 | |||
Accounts receivable, related parties | 6 | 6 | $ 4 | ||
State and Local Jurisdiction | |||||
Income Tax Contingency [Line Items] | |||||
Additional valuation allowance recognized (reduced) | $ (2) | $ 1 | $ 2 | $ 8 |
SUPPLEMENTAL FINANCIAL STATEM_4
SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION - Inventories by Major Category (Detail) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 34 | $ 45 |
Work-in-process | 19 | 31 |
Finished goods | 71 | 125 |
Replacement parts and other supplies | 17 | 23 |
Inventories | $ 141 | $ 224 |
DISPOSITIONS - Additional Infor
DISPOSITIONS - Additional Information (Details) $ in Millions | May 13, 2021USD ($) | Aug. 01, 2020USD ($)machine | Sep. 30, 2021USD ($) | Jun. 30, 2021USD ($)machine | Mar. 31, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Dec. 31, 2020USD ($) | Feb. 10, 2020USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Net proceeds from Sale of Androscoggin/Stevens Point Mills | $ 0 | $ 338 | |||||||||
Number of paper machines | machine | 2 | 2 | |||||||||
Proceeds from sale of machines and equipment | $ 11 | $ 1 | $ 1 | $ 1 | $ 11 | ||||||
Assets held for sale | 6 | 6 | 6 | $ 17 | |||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Verso Androscoggin, LLC | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Consideration considered | $ 352 | ||||||||||
Verso’s unfunded pension | $ 37 | ||||||||||
Net proceeds from Sale of Androscoggin/Stevens Point Mills | 338 | ||||||||||
Proceeds from divestiture of businesses | 344 | ||||||||||
Cash divested | 6 | ||||||||||
Gain (loss) on disposal | 88 | ||||||||||
Transition services revenue recognized | $ 2 | 5 | |||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Verso Androscoggin, LLC | Cost of Products Sold | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Transition services revenue recognized | 1 | 2 | |||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Verso Androscoggin, LLC | Selling, General and Administrative Expenses | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Transition services revenue recognized | $ 1 | $ 3 | |||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Duluth Mill | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Proceeds from divestiture of businesses | $ 7 | ||||||||||
Cash divested | 1 | ||||||||||
Gain (loss) on disposal | $ (3) | ||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | Luke Mill | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Assets held for sale | $ 6 | $ 6 | $ 6 | $ 17 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) | May 10, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Feb. 06, 2019 |
Line of Credit Facility [Line Items] | ||||
Debt instrument, fair value disclosure | $ 0 | $ 0 | ||
ABL Facility | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, remaining borrowing capacity | 120,000,000 | |||
ABL Facility | Revolving Credit Facilities | ||||
Line of Credit Facility [Line Items] | ||||
Long-term debt | 0 | |||
ABL Facility | Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Long-term debt | 21,000,000 | |||
ABL Facility | ABL Third Amendment Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, unused capacity, commitment fee percentage | 0.25% | |||
ABL Facility | ABL Third Amendment Facility | Minimum | LIBOR | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1.25% | |||
ABL Facility | ABL Third Amendment Facility | Minimum | Base Rate | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.25% | |||
ABL Facility | ABL Third Amendment Facility | Maximum | LIBOR | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1.75% | |||
ABL Facility | ABL Third Amendment Facility | Maximum | Base Rate | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.75% | |||
ABL Facility | ABL Third Amendment Facility | Revolving Credit Facilities | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | $ 200,000,000 | |||
ABL Facility | ABL Third Amendment Facility | Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | 75,000,000 | |||
ABL Facility | ABL Third Amendment Facility | Bridge Loan | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | $ 20,000,000 | |||
ABL Facility | ABL Amendment Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity, accordion feature | $ 75,000,000 | |||
ABL Facility | ABL Amendment Facility | Revolving Credit Facilities | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | 350,000,000 | |||
ABL Facility | ABL Amendment Facility | Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | 100,000,000 | |||
ABL Facility | ABL Amendment Facility | Bridge Loan | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowing capacity | $ 35,000,000 | |||
ABL Facility | ABL Facility | Revolving Credit Facilities | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, current borrowing capacity | $ 141,000,000 |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of Basic and Diluted Earnings (Loss) per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) available to common stockholders (in millions) | $ 58 | $ (31) | $ (16) | $ (11) |
Weighted average common shares outstanding - basic (shares) | 29,334 | 33,675 | 31,476 | 34,440 |
Dilutive shares from stock awards (shares) | 271 | 0 | 0 | 0 |
Weighted average common shares outstanding - diluted (shares) | 29,605 | 33,675 | 31,476 | 34,440 |
Basic income (loss) per share (usd per share) | $ 1.98 | $ (0.92) | $ (0.53) | $ (0.33) |
Diluted income (loss) per share (usd per share) | $ 1.96 | $ (0.92) | $ (0.53) | $ (0.33) |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Details) - $ / shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 16, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Class of warrant or right, outstanding (in shares) | 1.8 | 1.8 | 1.8 | |
Exercise price of warrants (in dollars per share) | $ 21.67 | $ 20.66 | $ 21.67 | $ 20.66 |
Number of shares called by warrants (in shares) | 2.3 | 2.4 | 2.3 | |
Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of diluted earnings per share (in shares) | 0.9 | 0.8 | 0.9 |
RETIREMENT BENEFITS - Component
RETIREMENT BENEFITS - Components of Net Periodic Benefit Cost (Detail) - Pension Plan - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 0 | $ 1 | $ 1 | $ 2 |
Interest cost | 10 | 12 | 29 | 35 |
Expected return on plan assets | (16) | (17) | (47) | (50) |
Settlement | 0 | 1 | 0 | 1 |
Net periodic pension cost (income) | $ (6) | $ (3) | $ (17) | $ (12) |
RETIREMENT BENEFITS - Additiona
RETIREMENT BENEFITS - Additional Information (Detail) - Pension Plan - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Mar. 11, 2021 | Mar. 10, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Contribution made by employer | $ 9 | $ 29 | $ 25 | $ 47 | ||
Expected cash contributions for current fiscal year | $ 25 | $ 46 |
EQUITY - Additional Information
EQUITY - Additional Information (Details) - USD ($) | Nov. 04, 2021 | Sep. 16, 2021 | Aug. 06, 2021 | May 13, 2021 | May 07, 2021 | Feb. 05, 2021 | Aug. 05, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Mar. 05, 2021 | Dec. 31, 2020 | Aug. 04, 2020 | Feb. 26, 2020 | Jul. 15, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Compound annual growth rate, period (in years) | 3 years | |||||||||||||||
Estimated compensation expense, percentage | 1 | |||||||||||||||
Equity award expense | $ 1,000,000 | $ 1,000,000 | $ 3,000,000 | $ 5,000,000 | ||||||||||||
Share repurchase program authorization | $ 150,000,000 | $ 250,000,000 | $ 250,000,000 | |||||||||||||
Common stock, special dividends declared (in dollars per share) | $ 3 | |||||||||||||||
Special dividends declared | $ 101,000,000 | |||||||||||||||
Share repurchase program remaining authorization | $ 45,000,000 | $ 45,000,000 | ||||||||||||||
Common stock, dividends declared (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | |||||||||||||
Number of shares called by warrants (in shares) | 2,400,000 | 2,300,000 | 2,400,000 | 2,300,000 | ||||||||||||
Exercise price of warrants (in dollars per share) | $ 20.66 | $ 20.66 | $ 21.67 | $ 20.66 | $ 21.67 | |||||||||||
Number of shares called by each warrant (in shares) | 1.35 | 1.35 | ||||||||||||||
Proceeds to be received upon exercise | $ 50,000,000 | |||||||||||||||
Class of warrant or right, exercised (in shares) | 0 | 0 | ||||||||||||||
Subsequent Event | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Common stock, dividends declared (in dollars per share) | $ 0.10 | |||||||||||||||
Share Repurchase Authorization | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Repurchase of common stock, number of shares (in shares) | 1,300,000 | 1,600,000 | ||||||||||||||
Repurchase of common stock, treasury stock acquired, average price per share (in dollars per share) | $ 15.97 | $ 14.14 | ||||||||||||||
Dutch Auction Tender Offer | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Share repurchase program authorization | $ 55,000,000 | |||||||||||||||
Repurchase of common stock, number of shares (in shares) | 3,000,000 | 3,000,000 | ||||||||||||||
Repurchase of common stock, treasury stock acquired, average price per share (in dollars per share) | $ 18.10 | $ 18.10 | ||||||||||||||
Treasury stock acquired | $ 56,000,000 | |||||||||||||||
Restricted Stock Units (RSUs) | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Compensation cost not yet recognized | $ 6,000,000 | $ 6,000,000 | ||||||||||||||
Vested and expected to vest, outstanding (in shares) | 800,000 | 800,000 | ||||||||||||||
Compensation cost not yet recognized, period for recognition (in years) | 2 years | |||||||||||||||
Time-based RSUs | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of shares granted (in shares) | 269,000 | |||||||||||||||
Performance awards fair value (in dollars per share) | $ 13.36 | $ 13.36 | $ 9.95 | |||||||||||||
Performance-based RSUs | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of shares granted (in shares) | 214,000 | |||||||||||||||
Performance awards fair value (in dollars per share) | $ 11.30 | $ 11.30 | $ 12.21 | |||||||||||||
Minimum | Dutch Auction Tender Offer | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Repurchase of common stock, treasury stock acquired, average price per share (in dollars per share) | $ 16 | |||||||||||||||
Maximum | Dutch Auction Tender Offer | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Repurchase of common stock, treasury stock acquired, average price per share (in dollars per share) | $ 18.30 | |||||||||||||||
Class A | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of shares called by warrants (in shares) | 2,400,000 | 1,800,000 | ||||||||||||||
Exercise price of warrants (in dollars per share) | $ 27.86 | |||||||||||||||
Warrants term (in years) | 7 years | |||||||||||||||
Share Based Compensation Award Tranche One | Minimum | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 0.00% | |||||||||||||||
Share Based Compensation Award Tranche One | Maximum | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Award vesting rights, percentage | 200.00% | |||||||||||||||
Executive Officer and Management | Time-based RSUs | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of shares granted (in shares) | 300,000 | |||||||||||||||
Award vesting period (in years) | 3 years | |||||||||||||||
Executive Officer and Management | Performance-based RSUs | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Number of shares granted (in shares) | 200,000 | |||||||||||||||
Chief Financial Officer | Time-based RSUs | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Performance awards fair value (in dollars per share) | $ 13.32 | |||||||||||||||
Chief Financial Officer | Performance-based RSUs | 2019 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Performance awards fair value (in dollars per share) | 0.67 | |||||||||||||||
Chief Financial Officer | Performance-based RSUs | 2020 | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||
Performance awards fair value (in dollars per share) | $ 8.66 |
EQUITY - Changes In Non-vested
EQUITY - Changes In Non-vested Units (Details) shares in Thousands | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Weighted Average Grant Date Fair Value | |
Incremental granted share, percentage | 113.00% |
Time-based RSUs | |
Restricted Stock Units Outstanding | |
Non-vested, beginning balance (in shares) | 421 |
Granted (in shares) | 269 |
Vested (in shares) | (265) |
Forfeited (in shares) | (73) |
Non-vested, ending balance (in shares) | 352 |
Weighted Average Grant Date Fair Value | |
Non-vested, beginning balance (in dollar per share) | $ / shares | $ 9.95 |
Granted (in dollar per share) | $ / shares | 13.85 |
Vested (in dollar per share) | $ / shares | 9.53 |
Forfeited (in dollar per share) | $ / shares | 11.85 |
Non-vested, ending balance (in dollar per share) | $ / shares | $ 13.36 |
Time-based Dividend Equivalent Units | |
Restricted Stock Units Outstanding | |
Granted (in shares) | 7 |
Performance-based RSUs | |
Restricted Stock Units Outstanding | |
Non-vested, beginning balance (in shares) | 424 |
Granted (in shares) | 214 |
Incremental shares vested (in shares) | 10 |
Vested (in shares) | (143) |
Forfeited (in shares) | (77) |
Non-vested, ending balance (in shares) | 428 |
Weighted Average Grant Date Fair Value | |
Non-vested, beginning balance (in dollar per share) | $ / shares | $ 12.21 |
Granted (in dollar per share) | $ / shares | 12.88 |
Incremental shares vested (in dollar per share) | $ / shares | 0 |
Vested (in dollar per share) | $ / shares | 12.85 |
Forfeited (in dollar per share) | $ / shares | 10.59 |
Non-vested, ending balance (in dollar per share) | $ / shares | $ 11.30 |
Performance-based Dividend Equivalent Units | |
Restricted Stock Units Outstanding | |
Granted (in shares) | 8 |
RESTRUCTURING CHARGES - Additio
RESTRUCTURING CHARGES - Additional Information (Details) $ in Millions | Feb. 08, 2021T | Jul. 31, 2020T | Jun. 30, 2019Tposition | Sep. 30, 2021USD ($) |
Restructuring Cost and Reserve [Line Items] | ||||
Accelerated depreciation recognized | $ | $ 84 | |||
Closure of No. 14 Paper Machine and Certain Other Long-Lived Assets | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Decrease in production capacity (in tons) | 185,000 | |||
Accelerated depreciation recognized | $ | $ 84 | |||
Closure of Duluth Mill | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Decrease in production capacity (in tons) | 270,000 | |||
Closure of Luke Mill | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Number of positions eliminated | position | 675 | |||
Closure of Luke Mill | Coated Freesheet | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Decrease in production capacity (in tons) | 450,000 |
RESTRUCTURING CHARGES - Charges
RESTRUCTURING CHARGES - Charges Incurred as Included in Restructuring Charges (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | $ 0 | $ (2) | $ 17 | $ 4 |
Closure of No. 14 Paper Machine and Certain Other Long-Lived Assets | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 8 | ||
Cumulative incurred | 8 | 8 | ||
Closure of No. 14 Paper Machine and Certain Other Long-Lived Assets | Property, plant and equipment, net | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 5 | ||
Cumulative incurred | 5 | 5 | ||
Closure of No. 14 Paper Machine and Certain Other Long-Lived Assets | Write-off of spare parts and inventory | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 3 | ||
Cumulative incurred | 3 | 3 | ||
Closure of Duluth Mill | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 9 | ||
Cumulative incurred | 16 | 16 | ||
Closure of Duluth Mill | Property, plant and equipment, net | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | ||
Cumulative incurred | 3 | 3 | ||
Closure of Duluth Mill | Severance and benefit costs | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | ||
Cumulative incurred | 1 | 1 | ||
Closure of Duluth Mill | Write-off of spare parts and inventory | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | ||
Cumulative incurred | 2 | 2 | ||
Closure of Duluth Mill | Write-off of purchase obligations and commitments | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 7 | ||
Cumulative incurred | 8 | 8 | ||
Closure of Duluth Mill | Other costs | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 2 | ||
Cumulative incurred | 2 | 2 | ||
Closure of Luke Mill | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | (2) | 0 | 4 |
Cumulative incurred | 57 | 57 | ||
Closure of Luke Mill | Property, plant and equipment, net | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | 0 | 0 |
Cumulative incurred | 10 | 10 | ||
Closure of Luke Mill | Severance and benefit costs | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | 0 | (1) |
Cumulative incurred | 18 | 18 | ||
Closure of Luke Mill | Write-off of spare parts and inventory | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | 0 | 0 |
Cumulative incurred | 9 | 9 | ||
Closure of Luke Mill | Write-off of purchase obligations and commitments | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | 0 | 0 | 0 |
Cumulative incurred | 1 | 1 | ||
Closure of Luke Mill | Other costs | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | 0 | $ (2) | 0 | 5 |
Cumulative incurred | $ 19 | $ 19 | ||
Closure of Luke Mill | Facility closing | ||||
Restructuring and Related Cost [Abstract] | ||||
Restructuring costs | $ 4 |
RESTRUCTURING CHARGES - Changes
RESTRUCTURING CHARGES - Changes in Restructuring Reserve Liabilities Related to the Closure (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | $ 0 | $ (2) | $ 17 | $ 4 |
Closure of Duluth Mill | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance of reserve | 2 | |||
Severance and benefit payments | (1) | |||
Purchase obligations | 0 | 9 | ||
Other costs | 2 | |||
Payments on other costs | (2) | |||
Ending balance of reserve | 8 | 8 | ||
Closure of Duluth Mill | Purchase obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | 7 | |||
Closure of Duluth Mill | Property, plant and equipment, net | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | 0 | 0 | ||
Closure of Duluth Mill | Severance and benefit costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | 0 | 0 | ||
Closure of Duluth Mill | Write-off of spare parts and inventory | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | 0 | 0 | ||
Closure of Duluth Mill | Write-off of purchase obligations and commitments | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | 0 | 7 | ||
Closure of Duluth Mill | Other costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Purchase obligations | $ 0 | $ 2 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Detail) $ in Thousands | Apr. 01, 2021USD ($) | Nov. 30, 2019tank | Sep. 30, 2021USD ($) | Mar. 31, 2021USD ($) | Sep. 30, 2021USD ($) | Sep. 01, 2021USD ($) | Dec. 31, 2020USD ($) |
Loss Contingencies [Line Items] | |||||||
Number of aboveground storage tanks | tank | 3 | ||||||
Charges to expense for new losses | $ 5,000 | ||||||
Accrual of environmental loss contingencies | $ 7,000 | $ 7,000 | |||||
Accrual of environmental loss contingencies, current | 2,000 | 2,000 | $ 5,000 | ||||
Accrued environmental loss contingencies, noncurrent | 5,000 | 5,000 | |||||
Business exit costs | $ 0 | $ 6,000 | |||||
Potomac Riverkeeper Network and Maryland Department of the Environment | |||||||
Loss Contingencies [Line Items] | |||||||
Settlement penalties and fees | $ 1,000 | ||||||
Reimbursement for first year proceeding decree | 25 | ||||||
Reimbursement each year after first year proceeding decree | $ 20 | ||||||
Monitoring period (in years) | 3 years | ||||||
West Virginia Department of Environmental Protection | |||||||
Loss Contingencies [Line Items] | |||||||
Accrual of environmental loss contingencies | $ 650 |
INFORMATION BY INDUSTRY SEGME_3
INFORMATION BY INDUSTRY SEGMENT - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)segmentregion | Sep. 30, 2020USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reporting segments | segment | 2 | |||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 339,000 | $ 306,000 | $ 950,000 | $ 1,045,000 |
North America | ||||
Segment Reporting Information [Line Items] | ||||
Number of geographic operating regions | region | 1 | |||
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 339,000 | 306,000 | $ 950,000 | 1,045,000 |
Gross margin (exclusive of depreciation and amortization) | 65,000 | (3,000) | 140,000 | 38,000 |
Operating Segments | Paper | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 304,000 | 274,000 | 856,000 | 956,000 |
Gross margin (exclusive of depreciation and amortization) | 49,000 | (6,000) | 109,000 | 36,000 |
Operating Segments | Pulp | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 35,000 | 32,000 | 94,000 | 89,000 |
Gross margin (exclusive of depreciation and amortization) | 16,000 | 3,000 | 31,000 | 2,000 |
Intercompany eliminations | Pulp | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ (12,000) | $ (3,000) | $ (17,000) | $ (7,000) |