10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

________________

FORM 10-Q

________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period From              to             

______________________________

Commission File Number 001-40718

________________

SYLVAMO CORPORATION

(Exact Name of Registrant as Specified in its Charter)

________________

Delaware	86-2596371
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

6077 Primacy Parkway Memphis, Tennessee	38119
(Address of Principal Executive Offices)	(Zip Code)

901-519-8000

(Registrant’s Telephone Number, Including Area Code)

N/A                

(Former name, former address and and former fiscal year if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $1.00 per share	SLVM	New York Stock Exchange

________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  ☒     No ☐ 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (paragraph 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒   No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange

Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ☐    No  ☒

The number of shares outstanding of the registrant’s common stock, par value $1.00 per share, as of May 5, 2023 was 42,563,277.

INDEX

		PAGE NO.
	PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements
	Condensed Consolidated Statements of Operations - Three Months Ended March 31, 2023 and 2022	1
	Condensed Consolidated Statements of Comprehensive Income (Loss) - Three Months Ended March 31, 2023 and 2022	2
	Condensed Consolidated Balance Sheets - March 31, 2023 and December 31, 2022	3
	Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 2023 and 2022	4
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4.	Controls and Procedures	25
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	26
Item 6.	Exhibits	27
Signatures		28

ITEM 1.    FINANCIAL STATEMENTS

SYLVAMO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In millions, except per share amounts)

	Three Months Ended March 31,
	2023		2022
NET SALES	$	959	$	821
COSTS AND EXPENSES
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	688		620
Selling and administrative expenses	82		66
Depreciation, amortization and cost of timber harvested	35		31
Taxes other than payroll and income taxes	6		6
Interest (income) expense, net	7		17
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	141		81
Income tax provision	44		26
NET INCOME FROM CONTINUING OPERATIONS	97		55
Discontinued operations, net of taxes	—		(29)
NET INCOME (LOSS)	$	97	$	26
BASIC EARNINGS (LOSS) PER SHARE
Earnings from continuing operations	$	2.28	$	1.25
Discontinued operations, net of taxes	—		(0.66)
Net earnings (loss)	$	2.28	$	0.59
DILUTED EARNINGS (LOSS) PER SHARE
Earnings from continuing operations	$	2.25	$	1.25
Discontinued operations, net of taxes	—		(0.66)
Net earnings (loss)	$	2.25	$	0.59

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SYLVAMO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In millions)

	Three Months Ended March 31,
	2023		2022
NET INCOME (LOSS)	$	97	$	26
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAXES
Defined Benefit Pension and Postretirement Adjustments:
Amortization of pension and postretirement loss (less taxes of $0 and $0)	—		(1)
Change in cumulative foreign currency translation adjustment	41		99
Net gains/losses on cash flow hedging derivatives:
Net gains (losses) arising during the period (less taxes of $0 and $(12))	(4)		29
Reclassification adjustment for (gains) losses included in net earnings (less taxes of $2 and $3)	(4)		(6)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAXES	33		121
COMPREHENSIVE INCOME (LOSS)	$	130	$	147

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SYLVAMO CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

	March 31, 2023		December 31, 2022
	(unaudited)
ASSETS
Current Assets
Cash and temporary investments	$	191	$	360
Accounts and notes receivable, net	441		450
Contract assets	33		30
Inventories	506		364
Other current assets	38		39
Total Current Assets	1,209		1,243
Plants, Properties and Equipment, net	938		817
Forestlands	340		322
Goodwill	133		128
Right of Use Assets	37		35
Deferred Charges and Other Assets	141		165
TOTAL ASSETS	$	2,798	$	2,710
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable	$	409	$	453
Notes payable and current maturities of long-term debt	104		29
Accrued payroll and benefits	53		81
Other current liabilities	160		165
Total Current Liabilities	726		728
Long-Term Debt	954		1,003
Deferred Income Taxes	198		183
Other Liabilities	130		118
Commitments and Contingent Liabilities (Note 13)
Equity
Common stock $1 par value, 200.0 shares authorized, 44.5 shares and 44.2 shares issued and 42.6 shares and 42.6 shares outstanding at March 31, 2023 and December 31, 2022, respectively	44		44
Paid-in capital	32		25
Retained earnings	2,116		2,029
Accumulated other comprehensive loss	(1,305)		(1,338)
	887		760
Less: Common stock held in treasury, at cost, 1.9 shares and 1.6 shares at March 31, 2023 and December 31, 2022, respectively	(97)		(82)
Total Equity	790		678
TOTAL LIABILITIES AND EQUITY	$	2,798	$	2,710

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SYLVAMO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In millions)

	Three Months Ended March 31,
	2023		2022
OPERATING ACTIVITIES
Net income from continuing operations	$	97	$	55
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and cost of timber harvested	35		31
Deferred income tax provision (benefit), net	5		7
Stock-based compensation	7		4
Changes in operating assets and liabilities and other
Accounts and notes receivable	82		16
Inventories	(81)		(26)
Accounts payable and accrued liabilities	(100)		(62)
Other	18		23
CASH PROVIDED BY OPERATING ACTIVITIES FROM CONTINUING OPERATIONS	63		48
CASH PROVIDED BY OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	—		44
CASH PROVIDED BY OPERATING ACTIVITIES	63		92
INVESTMENT ACTIVITIES
Invested in capital projects	(61)		(16)
Acquisition of business, net of cash acquired	(167)		—
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM CONTINUING OPERATIONS	(228)		(16)
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	—		(3)
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES	(228)		(19)
FINANCING ACTIVITIES
Dividends paid	(10)		—
Issuance of debt	427		—
Reduction of debt	(407)		(35)
Repurchases of common stock	(10)		—
Other	(8)		(4)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS	(8)		(39)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	—		—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	(8)		(39)
Effect of Exchange Rate Changes on Cash	4		15
Change in Cash Included in Assets Held for Sale	—		46
Change in Cash and Temporary Investments	(169)		3
Cash and Temporary Investments
Beginning of the period	360		159
End of the period	$	191	$	162

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SYLVAMO CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States and in accordance with the instructions to Form 10-Q and, in the opinion of management, include all adjustments that are necessary for the fair presentation of Sylvamo Corporation’s ("Sylvamo's", "the Company’s" or "our") financial position, results of operations, and cash flows for the interim periods presented. Except as disclosed herein, such adjustments are of a normal, recurring nature. Results for the first three months of the year may not necessarily be indicative of full year results due to factors such as the Company’s planned maintenance outage schedule at its mills. You should read these condensed consolidated financial statements in conjunction with the audited financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the "Annual Report"), which have previously been filed with the Securities and Exchange Commission. These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States that require the use of management’s estimates. Actual results could differ from management’s estimates.

Acquisition of Nymölla

On January 2, 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden. Sylvamo accounted for the acquisition under ASC 805, “Business Combinations” and the Nymölla mill’s results of operations are included in Sylvamo’s condensed consolidated financial statements from the date of acquisition.

Divestiture of Russian Operations

During the second quarter of 2022, management committed to a plan to sell the Company’s Russian operations, which were previously part of the Europe business segment. As a result, all historical operating results of the Russian operations are presented as “Discontinued operations, net of taxes” in the condensed consolidated statement of operations and the notes to the condensed consolidated financial statements. In October 2022, the Company completed the sale of its Russian operations to Pulp Invest Limited Liability Company, a company incorporated in the Russian Federation. See Note 8 Divestiture and Impairment of Business for further details.

NOTE 2 SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies are described in Note 2 Significant Accounting Policies to the audited consolidated and combined financial statements included in our 2022 Form 10-K. There have been no material changes to the significant accounting policies for the three months ended March 31, 2023.

Recently Issued Accounting Pronouncements Not Yet Adopted

Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” which was subsequently amended by ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of Sunset Date of Topic 848,“ issued in December 2022. Together this guidance provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. This guidance is effective upon issuance and generally can be applied through December 31, 2024. We will apply the amendments in this update to account for contract modifications due to changes in reference rates once those occur. We do not expect these amendments to have a material impact on our condensed consolidated financial statements.

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NOTE 3 REVENUE RECOGNITION

External Net Sales by Product

External net sales by major products were as follows by business segment:

	Three Months Ended March 31,
In millions	2023		2022
Europe
Uncoated Papers	$	221	$	90
Market Pulp	27		27
Europe	248		117
Latin America (a)
Uncoated Papers	186		181
Market Pulp	20		15
Latin America	206		196
North America
Uncoated Papers	487		486
Market Pulp	18		22
North America	505		508
Total	$	959	$	821

(a) Prior period amounts have been corrected to reflect market pulp sales

Revenue Contract Balances

A contract asset is created when the Company recognizes revenue on its customized products for which we have an enforceable right to payment.

A contract liability is created when customers prepay for goods prior to the Company transferring those goods to the customer. The contract liability is reduced when control of the goods is transferred to the customer, satisfying our performance obligation. Contract liabilities of $3 million are included in “Other current liabilities” as of March 31, 2023. There were no contract liabilities included in “Other current liabilities” as of December 31, 2022.

The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the difference between the price and quantity at comparable points in time for goods which we have an unconditional right to payment or receive pre-payment from the customer, respectively.

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NOTE 4 EQUITY

A summary of changes in equity for the three months ended March 31, 2023 and 2022 is provided below:

Three Months Ended March 31, 2023
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2022	44	$	44	$	25	$	2,029	$	(1,338)	$	(82)	$	678
Stock-based employee compensation	—	—		7		—		—		(5)		2
Share repurchases	—	—		—		—		—		(10)		(10)
Dividends ($0.25 per share)	—	—		—		(10)		—		—		(10)
Comprehensive income (loss)	—	—		—		97		33		—		130
Balance, March 31, 2023	44	$	44	$	32	$	2,116	$	(1,305)	$	(97)	$	790

Three Months Ended March 31, 2022
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2021	44	$	44	$	4	$	1,935	$	(1,801)	$	—	$	182
Stock-based employee compensation	—	—		4		—		—		(2)		2
Comprehensive income (loss)	—	—		—		26		121		—		147
Balance, March 31, 2022	44	$	44	$	8	$	1,961	$	(1,680)	$	(2)	$	331

NOTE 5 OTHER COMPREHENSIVE INCOME

The following table presents the changes in Accumulated Other Comprehensive Income (Loss) (“AOCI”), net of taxes, reported in the condensed consolidated financial statements:

	Three Months Ended March 31,
In millions	2023		2022
Defined Benefit Pension and Postretirement Adjustments
Balance at beginning of period	$	(76)	$	(80)
Amounts reclassified from accumulated other comprehensive income	—		(1)
Balance at end of period	(76)		(81)
Change in Cumulative Foreign Currency Translation Adjustments
Balance at beginning of period	(1,288)		(1,719)
Other comprehensive income (loss) before reclassifications	41		99
Balance at end of period	(1,247)		(1,620)
Net Gains and Losses on Cash Flow Hedging Derivatives
Balance at beginning of period	26		(2)
Other comprehensive income (loss) before reclassifications	(4)		29
Amounts reclassified from accumulated other comprehensive income	(4)		(6)
Balance at end of period	18		21
Total Accumulated Other Comprehensive Income (Loss) at End of Period	$	(1,305)	$	(1,680)

NOTE 6 EARNINGS PER SHARE

Basic earnings per share from continuing operations is computed by dividing net income from continuing operations by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share from continuing operations is computed by dividing net income from continuing operations by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been

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outstanding had potentially dilutive shares of common stock been issued. The dilutive effect of restricted stock units is reflected in diluted earnings per share by applying the treasury stock method. Basic and dilutive earnings per share from discontinued operations are computed under the same approach utilizing the same weighted-average number of shares of common stock outstanding during the period and dilutive shares.

There are no adjustments required to be made to net income from continuing operations for purposes of computing basic and diluted earnings per share from continuing operations.

Basic and diluted earnings per share from continuing operations are calculated as follows:

	Three Months Ended March 31,
In millions, except per share amounts	2023		2022
Net income from continuing operations	$	97	$	55
Weighted average common shares outstanding	42.5		44.0
Effect of dilutive securities	0.6		0.2
Weighted average common shares outstanding - assuming dilution	43.1		44.2
Earnings per share from continuing operations - basic	$	2.28	$	1.25
Earnings per share from continuing operations - diluted	$	2.25	$	1.25

NOTE 7 ACQUISITIONS

In January 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden, for €157 million (approximately $167 million) after post-close working capital adjustments. The integrated mill has the capacity to produce approximately 500,000 short tons of uncoated freesheet on two paper machines.

Sylvamo accounted for the acquisition under ASC 805, “Business Combinations” and the Nymölla mill’s results of operations are included in Sylvamo’s consolidated financial statements from the date of acquisition. Due to the timing of the closing of the acquisition, the purchase price allocation is preliminary and could be significantly revised as a result of additional information obtained regarding assets acquired and liabilities assumed and revisions of estimates of fair values of both tangible and intangible assets including goodwill and related deferred tax assets and liabilities. These revisions may include, but are not limited to, the completion of independent appraisals and valuations related to property, plant and equipment and intangible assets. The Company will finalize its valuation and the allocation of the purchase price, along with required retrospective adjustments, if any, within a year following the acquisition date.

The following table summarizes the preliminary allocation of the purchase price to the fair value assigned to assets and liabilities acquired as of January 2, 2023:

In millions
Accounts receivable	$	63
Inventory	67
Plants, properties and equipment	118
Other assets	2
Total assets acquired	250
Accounts payable	61
Other liabilities	22
Total liabilities assumed	83
Net assets acquired	$	167

In connection with the allocation of fair value, inventories were written up by $9 million to their estimated fair value. During the first quarter of 2023, $9 million before taxes ($7 million after taxes) was expensed related to the impact of the step-up of acquired Nymolla inventory sold during the quarter.

Since the date of acquisition, Net sales of $100 million and Income from continuing operations before income taxes of $8 million from the acquired business are included in the Company's condensed consolidated statement of operations for the three

8

months ended March 31, 2023. Additionally, Selling and administrative expenses for the three months ended March 31, 2023 include $4 million in charges before taxes ($3 million after taxes) for transaction costs associated with the acquisition.

On an unaudited pro forma basis, assuming the acquisition of the Nymölla mill had closed January 1, 2022, the condensed consolidated results would have reflected Net sales of $926 million and Income from continuing operations before income taxes of $83 million for the three months ended March 31, 2022.

The 2022 pro forma information includes adjustments for non-recurring transaction costs associated with the acquisition of $4 million, and incremental expense of $9 million incurred related to the impact of the step-up of acquired Nymolla inventory sold during the quarter.

The unaudited pro forma condensed consolidated financial information was prepared for comparative purposes only and includes certain adjustments, as noted above. This does not reflect the effect of costs or synergies that would have been expected to result from the integration of the acquisition. The pro forma information does not purport to represent Sylvamo's actual results of operations as if the transaction described above would have occurred as of January 1, 2022, nor is it necessarily an indicator of future results.

NOTE 8 DIVESTITURE AND IMPAIRMENT OF BUSINESS

RUSSIAN OPERATIONS

During the first quarter of 2022, as a result of the significant changes in the business climate impacting our Russian operations, a determination was made that the current carrying value of our Russian operations exceeded the estimated fair value. The fair value of the Russian operations was estimated based on a probability-weighted average approach of the potential cash flows from various paths the Company evaluated to exit the business. As a result, a pre-tax charge of $68 million ($57 million) was recorded for the impairment of the Russian fixed assets during the first quarter of 2022. These charges are included in “Impairment of business” within the summarized income statement for our Russian operations included in this footnote and is included in “Discontinued operations, net of taxes” in the condensed consolidated statement of operations.

During the second quarter of 2022, management committed to a plan to sell the Company’s Russian operations. In October 2022, the Company completed the sale of its Russian operations to Pulp Invest Limited Liability Company, a company incorporated in the Russian Federation, for $420 million. After transaction and foreign currency exchange costs of $35 million, Sylvamo received $385 million in cash proceeds.

As a result, all historical operating results of the Russian operations are presented as “Discontinued operations, net of taxes” in the condensed consolidated statement of operations. The Russian operations were previously part of the Europe business segment. The following summarizes the major classes of line items comprising Income (Loss) Before Income Taxes reconciled to Discontinued Operations, net of taxes, related to the Russian operations for all periods presented in the condensed consolidated statement of operations.

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	Three Months Ended March 31,
In millions	2022
NET SALES	$	156
COSTS AND EXPENSES
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	113
Selling and administrative expenses	1
Depreciation, amortization and cost of timber harvested	4
Taxes other than payroll and income taxes	—
Impairment of business	68
Interest (income) expense, net	(1)
INCOME (LOSS) BEFORE INCOME TAXES	(29)
Income tax provision (benefit)	—
DISCONTINUED OPERATIONS, NET OF TAXES	$	(29)

The following summarizes the total cash provided by operating activities from discontinued operations, net and total cash provided by (used for) investing activities from discontinued operations, net and included in the condensed consolidated statement of cash flows:

In millions for the three months ended March 31	2022
Cash Provided by Operating Activities	$	44
Cash Provided by (Used for) Investment Activities (a)	$	(3)

(a) Includes cash invested in capital projects of $3 million.

NOTE 9 SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION

Temporary Investments

Temporary investments with an original maturity of three months or less and money market funds with greater than three-month maturities but with the right to redeem without notice are treated as cash equivalents and are stated at cost. Temporary investments totaled $88 million and $80 million at March 31, 2023 and December 31, 2022, respectively.

Accounts and Notes Receivable

Accounts and notes receivable, net, by classification were:

In millions	March 31, 2023		December 31, 2022
Accounts and notes receivable:
Trade	$	416	$	430
Notes and other	25		20
Total	$	441	$	450

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The allowance for expected credit losses was $24 million and $20 million at March 31, 2023 and December 31, 2022, respectively. Based on the Company’s accounting estimates and the facts and circumstances available as of the reporting date, we believe our allowance for expected credit losses is adequate.

Inventories

In millions	March 31, 2023		December 31, 2022
Raw materials	$	87	$	40
Finished paper and pulp products	302		226
Operating supplies	94		78
Other	23		20
Total	$	506	$	364

Plants, Properties and Equipment, Net

Accumulated depreciation was $3.7 billion and $3.6 billion at March 31, 2023 and December 31, 2022, respectively. Depreciation expense was $30 million and $25 million for the three months ended March 31, 2023 and 2022, respectively.

Non-cash additions to plants, property and equipment included within accounts payable were $7 million and $36 million each at March 31, 2023 and December 31, 2022.

Interest

Interest payments of $24 million and $25 million were made during the three months ended March 31, 2023 and March 31, 2022, respectively.

Amounts related to interest were as follows:

	Three Months Ended March 31,
In millions	2023		2022
Interest expense (a)	$	19	$	18
Interest income (b)	(11)		(1)
Capitalized interest cost	(1)		—
Total	$	7	$	17

(a)    Interest expense for the three months ended March 31, 2023 includes $5 million of debt extinguishment cost related to the tender offer for our 7.00% 2029 Senior Notes.

(b) Interest income for the three months ended March 31, 2023 includes $9 million of interest income related to tax settlements.

ASSET RETIREMENT OBLIGATIONS

At both March 31, 2023 and December 31, 2022, we had recorded liabilities of $26 million related to asset retirement obligations. These amounts are included in “Other liabilities.”

NOTE 10 LEASES

The Company leases various real estate, including certain operating facilities, warehouses, office space and land. The Company also leases material handling equipment, vehicles and certain other equipment. The Company’s leases have a remaining lease term of up to 15 years. Total lease cost was $17 million and $15 million for the three months ended March 31, 2023 and 2022, respectively.

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Supplemental Balance Sheet Information Related to Leases

In millions	Classification	March 31, 2023		December 31, 2022
Assets
Operating lease assets	Right of use assets	$	37	$	35
Finance lease assets	Plants, properties, and equipment, net (a)	24		24
Total leased assets		$	61	$	59
Liabilities
Current
Operating	Other current liabilities	$	14	$	13
Finance	Notes payable and current maturities of long-term debt	3		3
Noncurrent
Operating	Other Liabilities	30		28
Finance	Long-term debt	14		14
Total lease liabilities		$	61	$	58

(a)Finance leases are recorded net of accumulated amortization of $14 million and $13 million as of March 31, 2023 and December 31, 2022, respectively.

NOTE 11 GOODWILL AND OTHER INTANGIBLES

Goodwill

The following table presents changes in the goodwill balance as allocated to each business segment for the three months ended March 31, 2023:

In millions	Europe		Latin America		North America		Total
Balance as of December 31, 2022
Goodwill	$	11	$	118	$	—	$	129
Accumulated impairment losses	(1)		—		—		(1)
	$	10	$	118	$	—	$	128
Currency translation and other (a)	—		5		—		5
Balance as of March 31, 2023
Goodwill	11		123		—		134
Accumulated impairment losses	(1)		—		—		(1)
Total	$	10	$	123	$	—	$	133

(a)Represents the effects of foreign currency translations and reclassifications.

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Other Intangibles

Identifiable intangible assets comprised the following:

	March 31, 2023						December 31, 2022
In millions	Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets		Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets
Customer relationships and lists	$	56	$	(50)	$	6	$	56	$	(50)	$	6
Other	7		(6)		1		7		(6)		1
Total	$	63	$	(56)	$	7	$	63	$	(56)	$	7

Amortization expense related to intangibles was immaterial for each of the three month periods ended March 31, 2023 and 2022, respectively.

NOTE 12 INCOME TAXES

An income tax provision of $44 million and $26 million was recorded for the three months ended March 31, 2023 and March 31, 2022, and the reported effective income tax rate from continuing operations was 31% and 32%, respectively.

The Brazilian Federal Revenue Service has challenged the deductibility of goodwill amortization generated in a 2007 acquisition by International Paper do Brasil Ltda., now named Sylvamo do Brasil Ltda. (“Sylvamo Brasil”), a wholly-owned subsidiary of the Company (the “Brazil Tax Dispute”). Sylvamo Brasil received assessments for the tax years 2007-2015 totaling approximately $111 million in tax, and $375 million in interest, penalties and fees as of March 31, 2023 (adjusted for variation in currency exchange rates). International Paper challenged and is managing the litigation of this matter pursuant to the tax matters agreement between us and International Paper. After a previous favorable ruling challenging the basis for these assessments, there were subsequent unfavorable decisions from the Brazilian Administrative Council of Tax Appeals. On behalf of Sylvamo Brasil, International Paper has appealed and at present, has advised us that it intends to further appeal these and any future unfavorable administrative judgments to the Brazilian federal courts; however, this tax litigation matter may take many years to resolve. The Company believes that the transaction underlying these assessments was appropriately evaluated, and that the Company’s tax position would be sustained, based on Brazilian tax law.

Pursuant to the terms of the tax matters agreement entered into between International Paper and Sylvamo, International Paper will pay 60%, and Sylvamo will pay 40% on up to $300 million of any assessment related to this matter, and International Paper will pay all amounts of the assessment over $300 million. Also in connection with this agreement, all decisions concerning the conduct of the litigation related to this matter, including strategy settlement, pursuit and abandonment, will continue to be made by International Paper, which is vigorously defending Sylvamo Brasil’s historic tax position against the current assessments and any similar assessments that may be issued for tax years subsequent to 2015.

NOTE 13 COMMITMENTS AND CONTINGENT LIABILITIES

Environmental and Legal Proceedings

The Company is subject to environmental and legal proceedings in the countries in which we operate. Accruals for contingent liabilities, such as environmental remediation costs, are recorded in the condensed consolidated financial statements when it is probable that a liability has been incurred or an asset impaired and the amount of the loss can be reasonably estimated. The Company has estimated some probable liability associated with environmental remediation matters that is immaterial in the aggregate as of March 31, 2023.

At the Company’s Mogi Guaçu mill, there are legacy basin areas that were formerly lagoons used for treatment of mill wastewater from pulp and paper manufacturing. In coordination with and in response to a request by the Environmental Company of the State of São Paulo (“CETESB”), which is the state environmental regulatory authority, there has been continuous regulatory monitoring and sampling of the former basins, which began prior to their closure in 2006, both to assess for contamination and evaluate whether additional remediation is needed beyond the basins’ ongoing natural vegetation growth.

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This monitoring and sampling detected metal contamination, with the main constituent of potential environmental impact being mercury. The Company has presented CETESB with proposals for studies and other actions to further assess the scope and type of contamination and the possible need for an additional remediation approach.

Additionally, in October 2022, CETESB requested that the Company expand its efforts to include providing CETESB with a proposed pilot intervention (remediation) plan for a portion of the former basins. The purpose of the pilot intervention plan is to facilitate determination of the appropriate actions to take for the basins generally, guided by the results of the pilot intervention plan in the subset of basins. The Company has submitted its pilot invention plan to CETESB and is waiting for CETESB to determine if it approves the plan set forth in the response.

As of March 31, 2023, the Company has recorded an immaterial liability for the ongoing and additional environmental studies and sampling of the basins. While this matter could in the future have a material impact on our results of operations or cash flows, the Company is unable to estimate its potential additional liability, including the costs of executing certain elements of the proposed pilot intervention plan, because the further studies to be conducted and the remediation that may be required, both for the pilot intervention plan and for the ultimate intervention, will depend on CETESB’s approval of the proposed pilot intervention plan, the results of the pilot intervention plan, the Company’s environmental studies assessing the existence of ecological risk due to the contamination and what intervention may be required beyond vegetation of the basins, the extent to which there is eventual risk of harm from the contamination, and CETESB’s approval of any ultimate intervention plan for the basins.

Taxes Other Than Payroll Taxes

See Note 12 Income Taxes for a discussion of a goodwill amortization tax matter in Brazil.

In the first quarter of 2023, the Company reached an amnesty agreement with the Brazilian government related to certain VAT amounts assessed in prior years. This agreement resulted in the recognition of $9 million of interest income during the period.

We have other open tax matters awaiting resolution in Brazil, which are at various stages of review in various administrative and judicial proceedings. We routinely assess these tax matters for materiality and probability of loss or gain, and appropriate amounts have been recorded in our financial statements for any open items where the risk of loss is deemed probable. We currently do not consider any of these other tax matters to be material individually. However, it is reasonably possible that settlement of any of these matters concurrently could result in a material loss or that over time a matter could become material, for example, if interest were accruing on the amount at issue for a significant period of time. Also, future exchange rate fluctuations could be unfavorable to the U.S. dollar and significant enough to cause an open matter to become material. The expected timing for resolution of these open matters ranges from one year to ten years.

General

The Company is involved in various other inquiries, administrative proceedings and litigation relating to environmental and safety matters, taxes (including VAT), personal injury, product liability, labor and employment, contracts, sales of property and other matters, some of which allege substantial monetary damages. Assessments of lawsuits and claims can involve a series of complex judgments about future events, can rely heavily on estimates and assumptions, and are otherwise subject to significant uncertainties. As a result, there can be no certainty that the Company will not ultimately incur charges in excess of presently recorded liabilities. The Company believes that loss contingencies arising from pending matters, including the matters described herein, will not have a material effect on the consolidated financial position or liquidity of the Company. However, in light of the inherent uncertainties involved in pending or threatened legal matters, some of which are beyond the Company's control, and the large or indeterminate damages sought in some of these matters, a future adverse ruling, settlement, unfavorable development, or increase in accruals with respect to these matters, could result in future charges that could be material to the Company's results of operations or cash flows in any particular reporting period.

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NOTE 14 LONG-TERM DEBT

Long-term debt is summarized in the following table:

In millions	March 31, 2023		December 31, 2022
Term Loan F - due 2027 (a)	$	490	$	496
Term Loan A - due 2028 (b)	297		—
7.00% Senior Notes - due 2029 (c)	89		444
Securitization Program	105		75
Other	17		17
Less: current portion	(44)		(29)
Total	$	954	$	1,003

(a) As of March 31, 2023 and December 31, 2022, presented net of $4 million and $4 million in unamortized debt issuance costs, respectively.

(b) As of March 31, 2023 presented net of $3 million in unamortized debt issuance costs.

(c) As of March 31, 2023 and December 31, 2022, presented net of $1 million and $6 million in unamortized original issue discount paid, respectively.

In addition to the debt noted above, the Company has the ability to access a cash flow-based revolving credit facility with a total borrowing capacity of $450 million (“Revolving Credit Facility”), which matures in 2026. As of March 31, 2023, the Company had $60 million outstanding borrowings on the Revolving Credit Facility and $24 million of letters of credit related to the Revolving Credit Facility, resulting in an available borrowing capacity of $366 million. As of December 31, 2022, the Company had no outstanding borrowings on the Revolving Credit Facility and $24 million of letters of credit related to the Revolving Credit Facility, resulting in an available borrowing capacity of $426 million. The outstanding borrowings on the Revolving Credit Facility are recorded within “Notes payable and current maturities of long-term debt” in the condensed consolidated balance sheet.

In the first quarter of 2023, the Company announced the commencement of a cash tender offer to purchase any and all of the Company’s outstanding 2029 Senior Notes. The Company also solicited consents from holders of the 2029 Senior Notes to amend certain provisions of the indenture with respect to the notes. In connection with the tender offer and the consent solicitation, the Company entered into a new senior secured term loan facility amendment which provided an aggregate principal amount of $300 million (“Term Loan A”) maturing in 2028. Term Loan A, together with $60 million borrowings under the Revolving Credit Facility, were used to pay the total consideration for all notes tendered in the tender offer, plus accrued interest and all fees and expenses incurred in connection with the tender offer and consent solicitation. As of March 31, 2023, $360 million aggregate principal of the notes were tendered, resulting in a debt extinguishment cost of $5 million, which includes the write-off of debt issuance costs. This cost was recorded within “Interest expense (income), net.”

Sylvamo North America LLC, a wholly owned subsidiary of the Company, maintains a $120 million accounts receivable finance facility (the “Securitization Program”), maturing in 2025. The Company sells substantially all of its North American accounts receivable balances to Sylvamo Receivables, LLC, a special purpose entity, which pledges the receivables as collateral for the Securitization Program. The borrowing availability under this facility is limited by the balance of eligible receivables within the program. As of March 31, 2023 and December 31, 2022, the Company had $105 million and $75 million outstanding borrowings under the receivables securitization program, respectively. The average interest rate for the quarters ended March 31, 2023 and December 31, 2022 was 5.34% and 5.19%, respectively.

The 2029 Senior Notes are unsecured bonds with a 7.00% fixed interest rate, payable semi-annually. The obligations under the Term Loan F, Term Loan A and Revolving Credit Facility are secured by substantially all the tangible and intangible assets of Sylvamo and its subsidiaries, subject to certain exceptions, and along with the 2029 Senior Notes facility are guaranteed by Sylvamo and certain subsidiaries. The interest rates applicable to the Term Loan F and Revolving Credit Facility are based on a fluctuating rate of interest measured by reference to LIBOR plus a fixed percentage of 1.75%, and 1.50%, respectively, payable monthly, with a LIBOR floor of 0.00%. The interest rate applicable to the Term Loan A is based on a fluctuating rate of interest measured in reference to SOFR plus a fixed percentage of 1.85%, subject to a SOFR floor of 0.00%

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We are receiving interest patronage credits under the Term Loan F. Patronage distributions, which are made primarily in cash but also in equity in the lenders, are generally received in the first quarter of the year following that in which they were earned. Expected patronage credits are accrued in accounts and notes receivable as a reduction to interest expense in the period earned. After giving effect to expected patronage distributions of 90 basis points, of which 70 basis points is expected as a cash rebate, the effective net interest rate on the Term Loan F was approximately 5.69% and 5.23% as of March 31, 2023 and December 31, 2022, respectively.

In connection with the Term Loan F, the Company entered into interest rate swaps with various counterparties with a notional amount of $400 million and maturities ranging from 2024 to 2026. In the first quarter, the Company received cash proceeds of $12 million from the unwind of four interest rate swaps maturing in 2024, with a total notional amount of $200 million. Subsequently, the Company entered into four new interest rate swaps with various counter parties with a notional amount of $200 million, which mature in 2025. The related gain has been deferred within “Accumulated other comprehensive loss” in the condensed consolidated balance sheet and will be amortized over the contracts’ original term of two remaining years. These interest rate swaps are designated as cash flow hedges, and are utilized to manage interest rate risk. The interest rate swaps allow for the Company to exchange the difference in the variable rates on Term Loan F determined in reference to LIBOR and the fixed interest rate per notional amount ranging from 1.30% to 3.85%.

As of March 31, 2023 and December 31, 2022, the fair value of the interest rate swaps related to Term Loan F was an asset of $14 million and $30 million, respectively. Assets resulting from interest rate swaps are reflected in “Deferred charges and other assets.”

In connection with the issuance of Term Loan A, the Company entered into interest rate swaps with a notional amount of $300 million and maturities in 2028. These interest rate swaps allow for the Company to exchange the difference in the variable rates on Term Loan A determined in reference to SOFR and the fixed interest rate per notional amount ranging from 4.13% to 4.16%. As of March 31, 2023, the fair value of these interest rate swaps resulted in a liability of $9 million, recorded within “Other liabilities.”

The Company is subject to certain covenants limiting, among other things, the ability of most of its subsidiaries to: (a) incur additional indebtedness or issue certain preferred shares; (b) pay dividends on or make distributions in respect of the Company’s or its subsidiaries’ capital stock or make investments or other restricted payments; (c) create restrictions on the ability of the Company’s restricted subsidiaries to pay dividends to the Company or make certain other intercompany transfers; (d) sell certain assets; (e) create liens; (f) consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets; and (g) enter into certain transactions with its affiliates. The Company is currently subject to a maximum consolidated total leverage ratio of 3.75 to 1.00.

The limit on restricted payments that we may make prior to the resolution of the Brazil Tax Dispute is $60 million if our pro-forma consolidated leverage ratio is less than 2.50 to 1.00 and greater than or equal to 2.00 to 1.00, or $90 million if the pro-forma consolidated leverage ratio is less than 2.00 to 1.00. However, limitations imposed on restricted payments are eliminated prior to the final settlement of the Brazil Tax Dispute if (i) we deposit $120 million in an account subject to the control of the administrative agent under our credit agreement, or (ii) we deposit $60 million in such an account and maintain $225 million of available liquidity at the time we make restricted payments. The funds deposited in the account would be used to pay the Company’s share of the settlement of the Brazil Tax Dispute, with any excess funds returned to us if our portion of any final settlement amount is less than the amount on deposit. If we meet these conditions, our ability to make restricted payments under the credit agreement would then be governed by the provisions in the credit agreement in effect when the Brazil Tax Dispute is settled.

As of March 31, 2023, we were in compliance with our debt covenants.

NOTE 15 PENSION AND POSTRETIREMENT BENEFIT PLANS

Defined Benefit Plans

The Company sponsors and maintains pension plans for the benefit of certain of the Company’s employees. The service and non-service cost components of net periodic pension expense for these employees is recorded within cost of products sold and selling and administrative expenses. The assets and liabilities related to plans sponsored by the Company are reflected in deferred charges and other assets and other liabilities, respectively.

Net periodic pension expense (benefit) for all pension plans sponsored by the Company for the three months ended March 31, 2023 and March 31, 2022 was immaterial.

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The Company’s funding policy for the pension plans is to contribute amounts sufficient to meet legal funding requirements, plus any additional amounts that the Company may determine to be appropriate considering the funded status of the plans, tax deductibility, cash flow generated by the Company, and other factors. The Company continually reassesses the amount and timing of any discretionary contributions. Generally, the non-U.S. pension plans are funded using the projected benefit as a target, except in certain countries where funding of benefit plans is not required.

NOTE 16 INCENTIVE PLANS

The Company has adopted the Sylvamo 2021 Incentive Compensation Plan, which includes shares under its long-term incentive plan (“LTIP”) that grants certain employees, consultants, or non-employee directors of the Company different forms of awards, including time-based and performance-based restricted stock units. As of March 31, 2023, 2,899,804 shares remain available for future grants.

Total stock-based compensation cost recognized by the Company was as follows:

	Three Months Ended March 31,
In millions	2023		2022
Total stock-based compensation expense (included in selling and administrative expense)	$	7	$	4

As of March 31, 2023, $30 million of compensation cost, net of estimated forfeitures, related to all stock-based compensation arrangements for Company employees had not yet been recognized. This amount will be recognized in expense over a weighted-average period of 1.5 years.

NOTE 17 FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA

The Company’s business segments, Europe, Latin America and North America, are consistent with the internal structure used to manage these businesses. All segments are differentiated on a common product, common customer basis, consistent with the business segmentation generally used in the Forest Products industry.

Business segment operating profit is used by the Company’s management to measure the earnings performance of its businesses. Management believes that this measure provides investors and analysts useful insights into our operating performance. Business segment operating profit is defined as income from continuing operations before income taxes, excluding interest (income) expense, net, and net special items.

External sales are defined as those that are made to parties outside the Company’s combined group, whereas sales by segment in the Net Sales table are determined using a management approach and include intersegment sales.

Information By Business Segment

Net Sales

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	248	$	117
Latin America	222		215
North America	505		508
Intersegment Sales	(16)		(19)
Net Sales	$	959	$	821

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Business Segment Operating Profit

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	23	$	2
Latin America	46		39
North America	97		62
Business Segment Operating Profit	$	166	$	103
Income from continuing operations before income taxes	$	141	$	81
Interest (income) expense, net	7		17
Net special items expense (income) (a)	18		5
Business Segment Operating Profit	$	166	$	103

(a) Special items represent income or expenses that are incurred periodically, rather than on a regular basis. Net special items in the periods presented primarily include transaction costs related to the Nymölla acquisition, professional and legal fees related to negotiations resulting in a shareholder cooperation agreement, the impact of the step-up of acquired Nymölla inventory sold during the quarter and one-time costs associated with the spin-off.

NOTE 18 RELATED PARTY TRANSACTIONS

Prior to the spin-off on October 1, 2021, we historically operated as part of International Paper and not as a standalone company. As a result of the spin-off on October 1, 2021, Sylvamo became an independent public company. On September 12, 2022, International Paper sold its remaining shares of Sylvamo stock. Therefore, International Paper is no longer a related party. The following discussion summarizes activity between the Company and International Paper both prior and subsequent to the spin-off and up to the time International Paper was deemed to no longer be a related party.

Related Party Sales and Purchases

The Company purchases certain of its products from International Paper which are produced in facilities that remained with International Paper. The Company continues to purchase uncoated freesheet and bristols pursuant to offtake agreements between the Company and International Paper. The Company purchased inventory associated with the offtake agreements of $149 million for the three months ended March 31, 2022.

The Company purchases fiber pursuant to fiber purchase agreements between the Company and International Paper. The Company purchased inventory associated with the fiber supply agreements of $49 million for the three months ended March 31, 2022.

The Company also purchases certain packaging materials from International Paper. These packaging purchases totaled $4 million for the three months ended March 31, 2022.

Transition Services Agreement

Pursuant to the Transition Services Agreement, International Paper and Sylvamo provided certain services to one another on an interim, transitional basis. The services included certain information technology services, finance and accounting services and human resources and employee benefits services. The agreed-upon charges for such services were generally intended to allow the providing company to recover all costs and expenses for providing such services. The total amount of expenses incurred by the Company under the Transition Services Agreement for the three months ended March 31, 2022 was $8 million. The Company is no longer receiving services under this agreement as of October 1, 2022.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes included in “Financial Information” of this Quarterly Report on Form 10-Q (this “Form 10-Q”) and the Company’s Form 10-K for the three years ended December 31, 2022, 2021 and 2020. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs that involve significant risks and uncertainties. Our actual results could differ materially from those stated and implied in any forward-looking statements. Factors that could cause or contribute to those differences include those discussed below and elsewhere in this Form 10-Q and in our 2022 Form 10-K, particularly under the headings “Risk Factors” and “Forward-Looking Statements.”

EXECUTIVE SUMMARY

First quarter 2023 net income from continuing operations was $97 million ($2.25 per diluted share) compared with $55 million ($1.25 per diluted share) for the first quarter of 2022. Net sales increased 17% to $959 million in the current quarter compared with $821 million in the first quarter of 2022. Cash from operations was $63 million compared to $48 million in the first quarter of 2022. Adjusted EBITDA was $208 million and our adjusted EBITDA margin was 22% compared to $146 million and an adjusted EBITDA margin of 18% in the first quarter of 2022. Free cash flow was $2 million compared to $32 million in the first quarter of 2022.

Comparing our performance in the first quarter of 2023 to the prior year comparable quarter, price and mix improvement outpaced higher input and transportation costs in all three regions. Volume was unfavorable in Latin America and North America due to a delay in the annual Brazilian government textbook program and continued destocking in North America, and planned maintenance costs in North America were lower when compared to the prior year comparable quarter. Our European business benefited from the earnings of our newly acquired Nymölla mill. In addition, we repurchased $360 million of our outstanding notes during the quarter in order to eliminate the notes covenant that limited annual shareowner cash returns to $90 million. The notes were replaced with a new term loan and short-term debt.

Looking ahead to the second quarter of 2023, we expect price and mix to be unfavorable reflecting the realization of prior price decreases for pulp in all regions and paper in Europe, as well as less favorable product mix. Volume is expected to improve, reflecting seasonally stronger volume in Latin America. Operations and costs are expected to increase due to unabsorbed fixed costs as we continue to match supply to our customers demand. Additionally, the second quarter will be our highest planned maintenance outage quarter, reflecting two-thirds of our total annual costs. Lastly, we expect input and transportation costs to be favorable due to lower costs for natural gas, chemicals and transportation.

Acquisition of Nymölla

On January 2, 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden. Sylvamo accounted for the acquisition under ASC 805, “Business Combinations” and the Nymölla mill’s results of operations are included in Sylvamo’s condensed consolidated financial statements from the date of acquisition.

Divestiture of Russian Operations

During the second quarter of 2022, management committed to a plan to sell the Company’s Russian operations (which were sold on October 2, 2022). As a result, the operating results of the Company’s Russian operations have been classified as “Discontinued operations, net of taxes” for all periods presented in the condensed consolidated statement of operations. See Note 8 Divestiture and Impairment of Business for further details.

BUSINESS SEGMENT RESULTS

Overview

Management provides business segment operating profit, a non-GAAP financial measure, to supplement our GAAP financial information, and it should be considered in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Management believes that business segment operating profit provides investors and analysts useful insights into our

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operating performance. Business segment operating profit is reconciled to Income from continuing operations before income taxes, the most directly comparable GAAP measure. Business segment operating profit may be determined or calculated differently by other companies and therefore may not be comparable among companies.

The following table presents a comparison of Income from continuing operations before taxes to business segment operating profit:

	Three Months Ended March 31,
In millions	2023		2022
Income From Continuing Operations Before Income Taxes	$	141	$	81
Interest (income) expense, net	7		17
Net special items expense (income) (b)	18		5
Business Segment Operating Profit (a)	$	166	$	103
Europe	$	23	$	2
Latin America	46		39
North America	97		62
Business Segment Operating Profit (a)	$	166	$	103

(a)    We define business segment operating profit as our income from continuing operations before income taxes calculated in accordance with GAAP, excluding net interest expense (income) and net special items. We believe that business segment operating profit is an important indicator of operating performance as it is a measure reported to our management for purposes of making decisions about allocating resources to our business segments and assessing the performance of our business segments.

(b)    Net special items represent income or expenses that are incurred periodically, rather than on a regular basis. Net special items in the periods presented primarily include transaction costs related to the Nymölla acquisition, professional and legal fees related to negotiations resulting in a shareholder cooperation agreement, the impact of the step-up of acquired Nymölla inventory sold during the quarter and one-time costs associated with the spin-off.

Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022

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The following tables present net sales and operating profit, which is the Company’s measure of business segment profitability, for each of the Company’s segments. See Note 17 Financial Information by Business Segment and Geographic Area for more information on the Company’s segments.

Europe

	Three Months Ended March 31,
In millions	2023		2022
Net Sales	$	248	$	117
Operating Profit	$	23	$	2

Our Europe business segment net sales increased $131 million, compared to the same period in 2022, primarily due to net sales of $100 million contributed by Nymölla and an increase in the market price for uncoated freesheet and pulp.

Europe operating profit was $21 million higher than the same period in 2022, driven primarily by increased sales prices and more favorable product mix ($23 million) and operating profit contributed by Nymölla ($16 million) which more than offset the impacts of higher operating costs ($6 million), higher input costs primarily for purchased pulp, chemicals and energy ($9 million), slightly lower volumes ($2 million) and slightly higher outages ($1 million).

Latin America

	Three Months Ended March 31,
In millions	2023		2022
Net Sales	$	222	$	215
Operating Profit	$	46	$	39

Our Latin America business segment net sales increased $7 million, compared to the same period in 2022, primarily driven by an increase in the market price and mix of uncoated freesheet and pulp for both export and domestic markets.

Operating profit for Latin America was $7 million higher than the same period in 2022, as the benefits of increased sales prices and more favorable product mix ($34 million), along with lower operating costs ($6 million), more than offset lower volumes ($12 million) and higher input costs ($21 million), primarily for purchased pulp, chemicals and energy.

North America

	Three Months Ended March 31,
In millions	2023		2022
Net Sales	$	505	$	508
Operating Profit	$	97	$	62

Our North America business segment net sales remained consistent, compared to the same period in 2022, as increased sales prices and more favorable product mix ($70 million) were largely offset by lower volumes ($68 million).

Operating profit for North America was $35 million higher than the same period in 2022, primarily due to increased sales price and more favorable product mix ($70 million) as well as lower outage costs ($8 million). These changes were partially offset by lower volumes ($17 million), higher operating costs ($8 million) and increased input costs ($18 million) primarily for purchased fiber, energy and chemicals, as well as higher distribution costs due to continued transportation cost increases.

Non-GAAP Financial Measures

Management provides Adjusted EBITDA, a non-GAAP financial measure, to supplement our GAAP financial information, and it should be considered in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Management uses this measure in managing the operating performance of our business and believes that Adjusted EBITDA provide investors and analysts meaningful insights into our operating performance and is a relevant metric for the third-party

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debt. Adjusted EBITDA is reconciled to Net income, the most directly comparable GAAP measure. Adjusted EBITDA may be determined or calculated differently by other companies and therefore may not be comparable among companies.

	Three Months Ended March 31,
In millions	2023			2022
Net Income (Loss)	$	97		$	26
Less: Discontinued operations, net of taxes	—			(29)
Net Income From Continuing Operations	97			55
Income tax provision	44			26
Interest (income) expense, net	7			17
Depreciation, amortization and cost of timber harvested	35			31
Stock-based compensation	7			4
Transition service agreement expense	—			8
Net special items expense (income) (a)	18			5
Adjusted EBITDA (b)	$	208		$	146
Net Sales	$	959		$	821
Adjusted EBITDA Margin	21.7		%	17.8		%

(a) Special items represent income or expenses that are incurred periodically, rather than on a regular basis. Net special items in the periods presented primarily include transaction costs related to the Nymölla acquisition, professional and legal fees related to negotiations resulting in a shareholder cooperation agreement, the impact of the step-up of acquired Nymölla inventory sold during the quarter and one-time costs associated with the spin-off.

(b)     We define Adjusted EBITDA (non-GAAP) as net income (GAAP) excluding discontinued operations, net of taxes plus the sum of income taxes, net interest expense (income), depreciation, amortization and cost of timber harvested, transition service agreement expense, stock-based compensation, and, when applicable for the periods reported, special items.

Free cash flow is a non-GAAP measure and the most directly comparable GAAP measure is cash provided by operating activities from continuing operations. Management believes that free cash flow is useful to investors as a liquidity measure because it measures the amount of cash generated that is available, after reinvesting in the business, to maintain a strong balance sheet and service debt, and return cash to shareowners. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. By adjusting for certain items that are not indicative of the Company’s ongoing performance, free cash flow also enables investors to perform meaningful comparisons between past and present periods.

The following is a reconciliation of Cash provided by continuing operations to Free Cash Flow:

	Three Months Ended March 31,
In millions	2023		2022
Cash provided by operating activities from continuing operations	$	63	$	48
Adjustments:
Cash invested in capital projects	(61)		(16)
Free Cash Flow	$	2	$	32

The non-GAAP financial measures presented in this Form 10-Q as referenced above have limitations as analytical tools and should not be considered in isolation or as a substitute for an analysis of our results calculated in accordance with GAAP. In addition, because not all companies utilize identical calculations, the Company’s presentation of non-GAAP measures in this Form 10-Q may not be comparable to similarly titled measures disclosed by other companies, including companies in the same industry as the Company.

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LIQUIDITY AND CAPITAL RESOURCES

Overview

Our ability to fund the Company’s cash needs depends on our ongoing ability to generate cash from operations and obtain financing on acceptable terms. Based upon our history of generating strong operating cash flow, we believe we will be able to meet our short-term liquidity needs. We believe we will meet known or reasonably likely future cash requirements through the combination of cash flows from operating activities, available cash balances and available borrowings through the issuance of third-party debt, as needed.

A major factor in our liquidity and capital resource planning is our generation of operating cash flow, which is highly sensitive to changes in the pricing and demand for our products. While changes in key operating cash costs, such as raw materials, energy, mill outages and distribution expenses do have an effect on operating cash generation, we believe that our focus on commercial and operational excellence, as well as our ability to manage costs and working capital, will provide sufficient cash flow generation to meet our operational and capital spending needs.

The terms of the agreements governing our debt contain customary limitations for the financing as well as other provisions. These provisions may also restrict our business and, in the event we cannot meet the terms of those provisions, may adversely impact our financial condition, results of operations or cash flows.

Operating Activities

Cash provided by operating activities from continuing operations totaled $63 million for the three months ended March 31, 2023, compared with cash provided by operating activities from continuing operations of $48 million for the three months ended March 31, 2022. The increase in cash provided by operating activities in 2023 relates primarily to higher net income offset by changes in working capital.

Cash used for working capital components (accounts and notes receivable, inventories, accounts payable and accrued liabilities, and other) was $81 million for the three months ended March 31, 2023, compared with cash used for working capital components of $49 million for the three months ended March 31, 2022. The three months ended March 31, 2023 working capital components primarily reflect $82 million and $18 million of cash provided by our accounts and notes receivable and other operating activities, respectively, offset by $81 million and $100 million in cash used for our inventories and accounts payable and accrued liabilities balances, respectively. The three months ended March 31, 2022 working capital components primarily reflect $16 million and $23 million of cash provided by our accounts and notes receivable balance and other operating activities, respectively, offset by $26 million and $62 million of cash used for our inventories and accounts payable and accrued liabilities balances, respectively.

Investment Activities

The total cash used for investing activities from continuing operations for the three months ended March 31, 2023 increased from the three months ended March 31, 2022, primarily due to the purchase of the Nymölla mill and the increase in capital spending in the current year.

The following table shows capital spending by business segment:

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	11	$	1
Latin America	32		10
North America	14		4
Corporate	4		1
Total	$	61	$	16

Capital spending primarily consists of purchases of machinery and equipment and reforestation costs related to our global mill operations.

23

Financing Activities

Cash used for financing activities from continuing operations for the three months ended March 31, 2023 primarily reflects the payments of $30 million, $10 million, and $7 million on our outstanding principal debt balances for the AR Securitization, Revolving Credit Facility, and Term Loan F, respectively. Additionally, $360 million was paid to bond holders as part of our tender offer. These amounts are primarily offset by the issuance of Term Loan A, draws on our Revolving Credit Facility, and AR Securitization of $300 million, $70 million, and $60 million, respectively. During the three months ended March 31, 2023 the Company also paid $10 million in dividends and repurchased $10 million of our shares pursuant to our share repurchase program. Cash used for financing activities from continuing operations for the three months ended March 31, 2022 primarily reflects the payments of $20 million, $10 million, and $3 million on our outstanding principal debt balances for the Revolving Credit Facility, Term Loan B, and Term Loan F, respectively.

Contractual Obligations

Our 2022 Form 10-K included disclosures of our contractual obligations and commitments as of December 31, 2022. We continue to make the contractually required payments, and, therefore, the 2022 obligations and commitments described in our 2022 Form 10-K have been reduced by the required payments.

Capital Expenditures

For the three months ended March 31, 2023, we have invested approximately $61 million, or 6.4% of net sales, in total capital expenditures. Over that period, we spent approximately $54 million, or 5.6% of net sales, in maintenance regulatory and reforestation capital expenditures, and approximately $7 million, or 0.7% of net sales, in high-return capital projects. Our annual maintenance, regulatory and reforestation capital expenditures are expected to be in the range of approximately $175 to $190 million per year for the next several years, which we believe will be sufficient to maintain our operations and productivity. In addition, we expect to spend approximately $35 million to $45 million on high-return projects in 2023.

CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with U.S. GAAP requires the Company to establish accounting policies and to make estimates that affect both the amounts and timing of the recording of assets, liabilities, revenues and expenses. Some of these estimates require subjective judgments about matters that are inherently uncertain.

Accounting policies whose application may have a significant effect on the reported results of operations and financial position of the Company, and that can require judgments by management that affect their application, include the accounting for impairment or disposal of long-lived assets and goodwill, business combinations and income taxes.

The Company has included in the Form 10-K a discussion of these critical accounting policies, which are important to the portrayal of the Company’s financial condition and results of operations and require management’s judgments. The Company has not made any changes in these critical accounting policies during the first three months of 2023.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains information that includes or is based upon forward-looking statements. Forward-looking statements forecast or state expectations concerning future events. These statements often can be identified by the fact that they do not relate strictly to historical or current facts. They typically use words such as “anticipate,” “assume,” “could,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “should,” “will” and other words and terms of similar meaning, or they are tied to future periods in connection with discussions of the Company’s performance. Some examples of forward-looking statements include those relating to our business and operating outlook, future obligations and anticipated expenditures.

Forward-looking statements are not guarantees of future performance. Any or all forward-looking statements may turn out to be incorrect, and actual results could differ materially from those expressed or implied in forward-looking statements. Forward-looking statements are based on current expectations and the current economic environment. They can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and other factors that are difficult to predict.

Although it is not possible to identify all of these risks, uncertainties and other factors, the following factors, among others, could cause our actual results to differ from those in the forward-looking statements: the deterioration of economic and political conditions where we operate such as continuing inflation that increases our costs of operating, conditions such as economic

24

recession decreasing demand for our products, and the war in Ukraine potentially spreading or causing significant economic disruption, particularly in Europe where we operate; workforce, natural gas, fuel and transportation shortages experienced by us and our suppliers creating challenges for our and their operations to overcome, increasing suppliers’ prices charged us and increasing our costs of operating; a resurgence of the COVID-19 pandemic or the occurrence of another public health crisis that results in new governmental measures implemented to address it that impede our, our suppliers’ or our customers’ operations, and that exacerbates inflation, workforce and transportation shortages; climate change and physical and financial risks to us associated with fluctuating regional and global weather conditions or patterns; reduced truck, rail and ocean freight availability resulting in higher costs to us or poor service; information technology risks related to potential breaches of security which may result in the distribution of company, customer, employee and vendor information; extensive environmental laws and regulations, as well as tax and other laws, in the United States, Brazil and other countries in which we operate, which could result in substantial costs to us as a result of compliance with, violations of or liabilities under these laws; failure to attract and retain senior management and other key and skilled employees, particularly in the current tight labor market; the loss of our commercial agreements with International Paper; failure of our separation from International Paper to qualify as a tax-free transaction for U.S. federal income tax purposes; our indebtedness and its impact on our ability to operate and satisfy our debt obligations; the limited trading history of our common stock; and the factors disclosed in Item 1A. Risk Factors in our annual report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”), as such disclosures may be amended, supplemented or superseded from time to time by other reports that we file with the Securities and Exchange Commission, including subsequent quarterly reports on Form 10-Q, annual reports on Form 10-K and current reports on Form 8-K.

We assume no obligation to update any forward-looking statements made in this quarterly report to reflect subsequent events or circumstances or actual outcomes.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information relating to quantitative and qualitative disclosures about market risk is shown on page 44 of the Company’s Form 10-K, which information is incorporated herein by reference. There have been no material changes in the Company’s exposure to market risk since December 31, 2022.

ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure of Controls and Procedures:

Management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2023. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of such date and designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is: recorded, processed, summarized and reported within the time periods specified in SEC rules and forms; and accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

In January 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden. Due to the timing of this acquisition, we have excluded this business from our evaluation of the effectiveness of internal control over financial reporting.

Changes in Internal Control over Financial Reporting:

The Company is in the process of integrating the recently acquired Nymölla mill into the Company's internal control over financial reporting. As a result of these integration activities, certain controls will be evaluated and may be changed. Excluding the Nymölla acquisition, there were no changes in our internal control over financial reporting that occurred in the first quarter of 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

25

PART II. OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

Sylvamo may be involved in legal proceedings arising from time to time in the ordinary course of business. Sylvamo is not involved in any legal proceedings that we believe will result, individually or in the aggregate, in a material adverse effect upon our financial condition or results of operations. Note 12 Income Taxes and Note 13 Commitments and Contingent Liabilities of the Notes to the Condensed Consolidated Financial Statements in this Form 10-Q are incorporated into this Item 1 by reference.

Item 103 of Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions, unless we reasonably believe the monetary sanctions will not equal or exceed a threshold of $1 million (which is the threshold we elected to use as permitted by this regulation). The matters set forth in Note 13 Commitments and Contingent Liabilities and incorporated herein are disclosed in accordance with such requirement.

ITEM 1A.    RISK FACTORS

The risk factors that affect our business and financial results are set forth under Part I, Item 1A, “Risk Factors,” in our 2022 Form 10-K. There have been no material changes to the risk factors described in the 2022 Form 10-K. The risk factors in “Item 1A. Risk Factors,” in the 2022 Form 10-K and the risks described in this Form 10-Q or our other SEC filings could cause our actual results to differ materially from those stated in any forward-looking statements.

ITEM 2. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares (or Units) Purchased as Part of the Publicly Announced Program	Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Program (in millions)
January 1, 2023 - January 31, 2023	201,985	$	49.53	201,896	$	60
February 1, 2023 - February 28, 2023 (a)	489	$	47.53	—	$	60
March 1, 2023 - March 31, 2023 (a)	87,691	$	49.33	—	$	60
Total	290,165			201,896

(a) 88,269 shares were acquired from employees from share withholdings under the Company’s long term incentive compensation program.

On May 18, 2022, the Board approved a share repurchase program under which the Company may purchase up to an aggregate amount of $150 million of shares of its common stock (the “Repurchase Program”). Pursuant to the Repurchase Program, the Company may repurchase in amounts, at prices and at such times as it deems appropriate, subject to market conditions and other considerations, including all applicable legal requirements. Repurchases may include purchases on the open market or privately negotiated transfers, under Rule 10b5-1 trading plans, under accelerated share repurchase programs, in tender offers and otherwise. The Repurchase Program does not obligate the Company to acquire any particular amount of shares of its common stock and may be modified or suspended at any time at the Company’s discretion. The Company repurchased $10 million of shares during the three months ended March 31, 2023.

26

ITEM 6.    EXHIBITS

3.1		Amended and Restated Certificate of Incorporation of Sylvamo Corporation (incorporated by reference to Exhibit 3.1 to Sylvamo Corporation’s Registration Statement on Form S-8 filed with the SEC on September 28, 2021).
3.2		Amended and Restated By-Laws of Sylvamo Corporation (incorporated by reference to Exhibit 3.2 to Sylvamo Corporation’s Current Report on Form 8-K filed with the SEC on October 1, 2021).
4.1		Second Supplemental Indenture, dated as of March 10, 2023, between Sylvamo Corporation and the Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.1 to Sylvamo Corporation’s Current Report on Form 8-K filed with the SEC on March 10, 2023 (the “Form 8-K filed 3/10/2023”)).
10.1		Credit Agreement, dated as of September 13, 2021 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time (including pursuant to Amendment No. 2)), among Sylvamo Corporation, Bank of America, N.A., as administrative agent, and the lenders from time to time party thereto (incorporated by reference to Exhibit 10.1 to the Form 8-K filed 3/10/2023).
10.2	†	2023 Long-Term Incentive Plan Award Agreement Terms and Conditions (incorporated by reference to Exhibit 10.19 to Sylvamo Corporation’s Annual Report on Form 10-K filed with the SEC on February 22, 2023 (the “Form 10-K filed 2/22/2023”)).
10.3	†	Sylvamo Corporation 2023 Annual Incentive Plan (incorporated by reference to Exhibit 10.21 to the Form 10-K filed 2/22/2023).
10.4	†	Sylvamo Corporation 2021 Executive Severance Plan (restated) (incorporated by reference to Exhibit 10.22 to the Form 10-K filed 2/22/2023).
31.1*		Certification of principal executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32**		Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document.
101.SCH XBRL		Taxonomy Extension Schema.
101.CAL XBRL		Taxonomy Extension Calculation Linkbase.
101.DEF XBRL		Taxonomy Extension Definition Linkbase.
101.LAB XBRL		Taxonomy Extension Label Linkbase.
101.PRE XBRL		Extension Presentation Linkbase.
104.		Cover Page Interactive Data File (formatted as Inline XBRL, and contained in Exhibit 101).

†     Management contract or compensatory plan or arrangement

*    Filed herewith

**    Furnished herewith

Items 3, 4 and 5 are not applicable and have been omitted.

27

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.

	SYLVAMO CORPORATION
Date: May 9, 2023	By:	/s/ Kevin W. Ferguson
	Name:	Kevin W. Ferguson
	Title:	Vice-President and Controller

28

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Jean-Michel Ribiéras, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sylvamo Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 9, 2023

By:    /s/ Jean-Michel Ribiéras                

Jean-Michel Ribiéras

Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, John V. Sims, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sylvamo Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 9, 2023

By:    /s/ John V. Sims                    

John V. Sims

Senior Vice President and Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Sylvamo Corporation (the “Company”) for the period ended March 31, 2023 (the “Report”), each of the undersigned certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:     /s/ Jean-Michel Ribiéras         

Jean-Michel Ribiéras

Chairman and Chief Executive Officer

May 9, 2023

By:     /s/ John V. Sims                 

John V. Sims

Senior Vice President and Chief Financial Officer

May 9, 2023

XML

Cover - shares	3 Months Ended
	Mar. 31, 2023	May 05, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Transition Report	false
Entity File Number	001-40718
Entity Registrant Name	SYLVAMO CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	86-2596371
Entity Address, Address Line One	6077 Primacy Parkway
Entity Address, City or Town	Memphis
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	38119
City Area Code	901
Local Phone Number	519-8000
Title of 12(b) Security	Common Stock, par value $1.00 per share
Trading Symbol	SLVM
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		42,563,277
Entity Central Index Key	0001856485
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Filer Category	Large Accelerated Filer

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CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement [Abstract]
NET SALES	$ 959	$ 821
COSTS AND EXPENSES
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	688	620
Selling and administrative expenses	82	66
Depreciation, amortization and cost of timber harvested	35	31
Taxes other than payroll and income taxes	6	6
Interest (income) expense, net	7	17
Income from continuing operations before income taxes	141	81
Income tax provision	44	26
NET INCOME FROM CONTINUING OPERATIONS	97	55
Discontinued operations, net of taxes	0	(29)
NET INCOME (LOSS)	$ 97	$ 26
BASIC EARNINGS (LOSS) PER SHARE
Earnings from continuing operations, basic (in dollars per share)	$ 2.28	$ 1.25
Discontinued operations, net of taxes, basic (in dollars per share)	0	(0.66)
Net earnings (loss), basic (in dollars per share)	2.28	0.59
DILUTED EARNINGS (LOSS) PER SHARE
Earnings from continuing operations, diluted (in dollars per share)	2.25	1.25
Discontinued operations, net of taxes, diluted (in dollars per share)	0	(0.66)
Net earnings (loss), diluted (in dollars per share)	$ 2.25	$ 0.59

XML

CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
NET INCOME (LOSS)	$ 97	$ 26
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAXES
Amortization of pension and postretirement loss (less taxes of $0 and $0)	0	(1)
Change in cumulative foreign currency translation adjustment	41	99
Net gains/losses on cash flow hedging derivatives:
Net gains (losses) arising during the period (less taxes of $0 and $(12))	(4)	29
Reclassification adjustment for (gains) losses included in net earnings (less taxes of $2 and $3)	(4)	(6)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAXES	33	121
COMPREHENSIVE INCOME (LOSS)	$ 130	$ 147

XML

COMPREHENSIVE CONSOLIDATED AND COMBINED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Comprehensive Income [Abstract]
Amortization of pension and postretirement loss, tax	$ 0	$ 0
Net gains (losses) arising during the period, tax	0	(12)
Reclassification adjustments for (gains) losses included in net earnings, tax	$ 2	$ 3

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Current Assets
Cash and temporary investments	$ 191	$ 360
Accounts and notes receivable, net	441	450
Contract assets	33	30
Inventories	506	364
Other current assets	38	39
Total Current Assets	1,209	1,243
Plants, Properties and Equipment, net	938	817
Forestlands	340	322
Goodwill	133	128
Right of Use Assets	37	35
Deferred Charges and Other Assets	141	165
TOTAL ASSETS	2,798	2,710
Current Liabilities
Accounts payable	409	453
Notes payable and current maturities of long-term debt	104	29
Accrued payroll and benefits	53	81
Other current liabilities	160	165
Total Current Liabilities	726	728
Long-Term Debt	954	1,003
Deferred Income Taxes	198	183
Other Liabilities	130	118
Commitments and Contingent Liabilities (Note 13)
Equity
Common stock $1 par value, 200.0 shares authorized, 44.5 shares and 44.2 shares issued and 42.6 shares and 42.6 shares outstanding at March 31, 2023 and December 31, 2022, respectively	44	44
Paid-in capital	32	25
Retained earnings	2,116	2,029
Accumulated other comprehensive loss	(1,305)	(1,338)
Stockholders' equity before treasury stock	887	760
Less: Common stock held in treasury, at cost, 1.9 shares and 1.6 shares at March 31, 2023 and December 31, 2022, respectively	(97)	(82)
Total Equity	790	678
TOTAL LIABILITIES AND EQUITY	$ 2,798	$ 2,710

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, shares authorized (in shares)	200,000,000.0	200,000,000.0
Common stock, shares issued (in shares)	44,500,000	44,200,000
Common shares, outstanding (in shares)	42,600,000	42,600,000
Treasury stock (in shares)	1,900,000	1,600,000

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CONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Statement of Cash Flows [Abstract]
NET INCOME FROM CONTINUING OPERATIONS	$ 97	$ 55
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and cost of timber harvested	35	31
Deferred income tax provision (benefit), net	5	7
Stock-based compensation	7	4
Changes in operating assets and liabilities and other
Accounts and notes receivable	82	16
Inventories	(81)	(26)
Accounts payable and accrued liabilities	(100)	(62)
Other	18	23
CASH PROVIDED BY OPERATING ACTIVITIES FROM CONTINUING OPERATIONS	63	48
CASH PROVIDED BY OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	0	44
CASH PROVIDED BY OPERATING ACTIVITIES	63	92
INVESTMENT ACTIVITIES
Invested in capital projects	(61)	(16)
Acquisition of business, net of cash acquired	(167)	0
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM CONTINUING OPERATIONS	(228)	(16)
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	0	(3)
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES	(228)	(19)
FINANCING ACTIVITIES
Dividends paid	(10)	0
Issuance of debt	427	0
Reduction of debt	(407)	(35)
Repurchases of common stock	(10)	0
Other	(8)	(4)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES FROM CONTINUING OPERATIONS	(8)	(39)
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	0	0
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	(8)	(39)
Effect of Exchange Rate Changes on Cash	4	15
Change in Cash Included in Assets Held for Sale	0	46
Change in Cash and Temporary Investments	(169)	3
Beginning of the period	360	159
End of the period	$ 191	$ 162

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BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States and in accordance with the instructions to Form 10-Q and, in the opinion of management, include all adjustments that are necessary for the fair presentation of Sylvamo Corporation’s ("Sylvamo's", "the Company’s" or "our") financial position, results of operations, and cash flows for the interim periods presented. Except as disclosed herein, such adjustments are of a normal, recurring nature. Results for the first three months of the year may not necessarily be indicative of full year results due to factors such as the Company’s planned maintenance outage schedule at its mills. You should read these condensed consolidated financial statements in conjunction with the audited financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the "Annual Report"), which have previously been filed with the Securities and Exchange Commission. These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States that require the use of management’s estimates. Actual results could differ from management’s estimates.

Acquisition of Nymölla

On January 2, 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden. Sylvamo accounted for the acquisition under ASC 805, “Business Combinations” and the Nymölla mill’s results of operations are included in Sylvamo’s condensed consolidated financial statements from the date of acquisition.

Divestiture of Russian Operations

During the second quarter of 2022, management committed to a plan to sell the Company’s Russian operations, which were previously part of the Europe business segment. As a result, all historical operating results of the Russian operations are presented as “Discontinued operations, net of taxes” in the condensed consolidated statement of operations and the notes to the condensed consolidated financial statements. In October 2022, the Company completed the sale of its Russian operations to Pulp Invest Limited Liability Company, a company incorporated in the Russian Federation. See Note 8 Divestiture and Impairment of Business for further details.

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SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies are described in Note 2 Significant Accounting Policies to the audited consolidated and combined financial statements included in our 2022 Form 10-K. There have been no material changes to the significant accounting policies for the three months ended March 31, 2023.

Recently Issued Accounting Pronouncements Not Yet Adopted

Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” which was subsequently amended by ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of Sunset Date of Topic 848,“ issued in December 2022. Together this guidance provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. This guidance is effective upon issuance and generally can be applied through December 31, 2024. We will apply the amendments in this update to account for contract modifications due to changes in reference rates once those occur. We do not expect these amendments to have a material impact on our condensed consolidated financial statements.

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REVENUE RECOGNITION

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

External Net Sales by Product

External net sales by major products were as follows by business segment:

	Three Months Ended March 31,
In millions	2023		2022
Europe
Uncoated Papers	$	221	$	90
Market Pulp	27		27
Europe	248		117
Latin America (a)
Uncoated Papers	186		181
Market Pulp	20		15
Latin America	206		196
North America
Uncoated Papers	487		486
Market Pulp	18		22
North America	505		508
Total	$	959	$	821

(a) Prior period amounts have been corrected to reflect market pulp sales

Revenue Contract Balances

A contract asset is created when the Company recognizes revenue on its customized products for which we have an enforceable right to payment.

A contract liability is created when customers prepay for goods prior to the Company transferring those goods to the customer. The contract liability is reduced when control of the goods is transferred to the customer, satisfying our performance obligation. Contract liabilities of $3 million are included in “Other current liabilities” as of March 31, 2023. There were no contract liabilities included in “Other current liabilities” as of December 31, 2022.

The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the difference between the price and quantity at comparable points in time for goods which we have an unconditional right to payment or receive pre-payment from the customer, respectively.

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EQUITY

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

EQUITY

EQUITY

A summary of changes in equity for the three months ended March 31, 2023 and 2022 is provided below:

Three Months Ended March 31, 2023
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2022	44	$	44	$	25	$	2,029	$	(1,338)	$	(82)	$	678
Stock-based employee compensation	—	—		7		—		—		(5)		2
Share repurchases	—	—		—		—		—		(10)		(10)
Dividends ($0.25 per share)	—	—		—		(10)		—		—		(10)
Comprehensive income (loss)	—	—		—		97		33		—		130
Balance, March 31, 2023	44	$	44	$	32	$	2,116	$	(1,305)	$	(97)	$	790

Three Months Ended March 31, 2022
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2021	44	$	44	$	4	$	1,935	$	(1,801)	$	—	$	182
Stock-based employee compensation	—	—		4		—		—		(2)		2
Comprehensive income (loss)	—	—		—		26		121		—		147
Balance, March 31, 2022	44	$	44	$	8	$	1,961	$	(1,680)	$	(2)	$	331

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OTHER COMPREHENSIVE INCOME

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

OTHER COMPREHENSIVE INCOME

OTHER COMPREHENSIVE INCOME

The following table presents the changes in Accumulated Other Comprehensive Income (Loss) (“AOCI”), net of taxes, reported in the condensed consolidated financial statements:

	Three Months Ended March 31,
In millions	2023		2022
Defined Benefit Pension and Postretirement Adjustments
Balance at beginning of period	$	(76)	$	(80)
Amounts reclassified from accumulated other comprehensive income	—		(1)
Balance at end of period	(76)		(81)
Change in Cumulative Foreign Currency Translation Adjustments
Balance at beginning of period	(1,288)		(1,719)
Other comprehensive income (loss) before reclassifications	41		99
Balance at end of period	(1,247)		(1,620)
Net Gains and Losses on Cash Flow Hedging Derivatives
Balance at beginning of period	26		(2)
Other comprehensive income (loss) before reclassifications	(4)		29
Amounts reclassified from accumulated other comprehensive income	(4)		(6)
Balance at end of period	18		21
Total Accumulated Other Comprehensive Income (Loss) at End of Period	$	(1,305)	$	(1,680)

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EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHAREBasic earnings per share from continuing operations is computed by dividing net income from continuing operations by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share from continuing operations is computed by dividing net income from continuing operations by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been

outstanding had potentially dilutive shares of common stock been issued. The dilutive effect of restricted stock units is reflected in diluted earnings per share by applying the treasury stock method. Basic and dilutive earnings per share from discontinued operations are computed under the same approach utilizing the same weighted-average number of shares of common stock outstanding during the period and dilutive shares.

There are no adjustments required to be made to net income from continuing operations for purposes of computing basic and diluted earnings per share from continuing operations.

Basic and diluted earnings per share from continuing operations are calculated as follows:

	Three Months Ended March 31,
In millions, except per share amounts	2023		2022
Net income from continuing operations	$	97	$	55
Weighted average common shares outstanding	42.5		44.0
Effect of dilutive securities	0.6		0.2
Weighted average common shares outstanding - assuming dilution	43.1		44.2
Earnings per share from continuing operations - basic	$	2.28	$	1.25
Earnings per share from continuing operations - diluted	$	2.25	$	1.25

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ACQUISITIONS

3 Months Ended

Mar. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Business Combination Disclosure

ACQUISITIONS

In January 2023, the Company completed the previously announced acquisition of Stora Enso’s uncoated freesheet paper mill in Nymölla, Sweden, for €157 million (approximately $167 million) after post-close working capital adjustments. The integrated mill has the capacity to produce approximately 500,000 short tons of uncoated freesheet on two paper machines.

Sylvamo accounted for the acquisition under ASC 805, “Business Combinations” and the Nymölla mill’s results of operations are included in Sylvamo’s consolidated financial statements from the date of acquisition. Due to the timing of the closing of the acquisition, the purchase price allocation is preliminary and could be significantly revised as a result of additional information obtained regarding assets acquired and liabilities assumed and revisions of estimates of fair values of both tangible and intangible assets including goodwill and related deferred tax assets and liabilities. These revisions may include, but are not limited to, the completion of independent appraisals and valuations related to property, plant and equipment and intangible assets. The Company will finalize its valuation and the allocation of the purchase price, along with required retrospective adjustments, if any, within a year following the acquisition date.

The following table summarizes the preliminary allocation of the purchase price to the fair value assigned to assets and liabilities acquired as of January 2, 2023:

In millions
Accounts receivable	$	63
Inventory	67
Plants, properties and equipment	118
Other assets	2
Total assets acquired	250
Accounts payable	61
Other liabilities	22
Total liabilities assumed	83
Net assets acquired	$	167

In connection with the allocation of fair value, inventories were written up by $9 million to their estimated fair value. During the first quarter of 2023, $9 million before taxes ($7 million after taxes) was expensed related to the impact of the step-up of acquired Nymolla inventory sold during the quarter.

Since the date of acquisition, Net sales of $100 million and Income from continuing operations before income taxes of $8 million from the acquired business are included in the Company's condensed consolidated statement of operations for the three

months ended March 31, 2023. Additionally, Selling and administrative expenses for the three months ended March 31, 2023 include $4 million in charges before taxes ($3 million after taxes) for transaction costs associated with the acquisition.

On an unaudited pro forma basis, assuming the acquisition of the Nymölla mill had closed January 1, 2022, the condensed consolidated results would have reflected Net sales of $926 million and Income from continuing operations before income taxes of $83 million for the three months ended March 31, 2022.

The 2022 pro forma information includes adjustments for non-recurring transaction costs associated with the acquisition of $4 million, and incremental expense of $9 million incurred related to the impact of the step-up of acquired Nymolla inventory sold during the quarter.

The unaudited pro forma condensed consolidated financial information was prepared for comparative purposes only and includes certain adjustments, as noted above. This does not reflect the effect of costs or synergies that would have been expected to result from the integration of the acquisition. The pro forma information does not purport to represent Sylvamo's actual results of operations as if the transaction described above would have occurred as of January 1, 2022, nor is it necessarily an indicator of future results.

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DIVESTITURE AND IMPAIRMENT OF BUSINESS

3 Months Ended

Mar. 31, 2023

Discontinued Operations and Disposal Groups [Abstract]

DIVESTITURE AND IMPAIRMENT OF BUSINESS

DIVESTITURE AND IMPAIRMENT OF BUSINESS

RUSSIAN OPERATIONS

During the first quarter of 2022, as a result of the significant changes in the business climate impacting our Russian operations, a determination was made that the current carrying value of our Russian operations exceeded the estimated fair value. The fair value of the Russian operations was estimated based on a probability-weighted average approach of the potential cash flows from various paths the Company evaluated to exit the business. As a result, a pre-tax charge of $68 million ($57 million) was recorded for the impairment of the Russian fixed assets during the first quarter of 2022. These charges are included in “Impairment of business” within the summarized income statement for our Russian operations included in this footnote and is included in “Discontinued operations, net of taxes” in the condensed consolidated statement of operations.

During the second quarter of 2022, management committed to a plan to sell the Company’s Russian operations. In October 2022, the Company completed the sale of its Russian operations to Pulp Invest Limited Liability Company, a company incorporated in the Russian Federation, for $420 million. After transaction and foreign currency exchange costs of $35 million, Sylvamo received $385 million in cash proceeds.

As a result, all historical operating results of the Russian operations are presented as “Discontinued operations, net of taxes” in the condensed consolidated statement of operations. The Russian operations were previously part of the Europe business segment. The following summarizes the major classes of line items comprising Income (Loss) Before Income Taxes reconciled to Discontinued Operations, net of taxes, related to the Russian operations for all periods presented in the condensed consolidated statement of operations.

	Three Months Ended March 31,
In millions	2022
NET SALES	$	156
COSTS AND EXPENSES
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	113
Selling and administrative expenses	1
Depreciation, amortization and cost of timber harvested	4
Taxes other than payroll and income taxes	—
Impairment of business	68
Interest (income) expense, net	(1)
INCOME (LOSS) BEFORE INCOME TAXES	(29)
Income tax provision (benefit)	—
DISCONTINUED OPERATIONS, NET OF TAXES	$	(29)

The following summarizes the total cash provided by operating activities from discontinued operations, net and total cash provided by (used for) investing activities from discontinued operations, net and included in the condensed consolidated statement of cash flows:

In millions for the three months ended March 31	2022
Cash Provided by Operating Activities	$	44
Cash Provided by (Used for) Investment Activities (a)	$	(3)

(a) Includes cash invested in capital projects of $3 million.

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION

SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION

Temporary Investments

Temporary investments with an original maturity of three months or less and money market funds with greater than three-month maturities but with the right to redeem without notice are treated as cash equivalents and are stated at cost. Temporary investments totaled $88 million and $80 million at March 31, 2023 and December 31, 2022, respectively.

Accounts and Notes Receivable

Accounts and notes receivable, net, by classification were:

In millions	March 31, 2023		December 31, 2022
Accounts and notes receivable:
Trade	$	416	$	430
Notes and other	25		20
Total	$	441	$	450

The allowance for expected credit losses was $24 million and $20 million at March 31, 2023 and December 31, 2022, respectively. Based on the Company’s accounting estimates and the facts and circumstances available as of the reporting date, we believe our allowance for expected credit losses is adequate.

Inventories

In millions	March 31, 2023		December 31, 2022
Raw materials	$	87	$	40
Finished paper and pulp products	302		226
Operating supplies	94		78
Other	23		20
Total	$	506	$	364

Plants, Properties and Equipment, Net

Accumulated depreciation was $3.7 billion and $3.6 billion at March 31, 2023 and December 31, 2022, respectively. Depreciation expense was $30 million and $25 million for the three months ended March 31, 2023 and 2022, respectively.

Non-cash additions to plants, property and equipment included within accounts payable were $7 million and $36 million each at March 31, 2023 and December 31, 2022.

Interest

Interest payments of $24 million and $25 million were made during the three months ended March 31, 2023 and March 31, 2022, respectively.

Amounts related to interest were as follows:

	Three Months Ended March 31,
In millions	2023		2022
Interest expense (a)	$	19	$	18
Interest income (b)	(11)		(1)
Capitalized interest cost	(1)		—
Total	$	7	$	17

(a)    Interest expense for the three months ended March 31, 2023 includes $5 million of debt extinguishment cost related to the tender offer for our 7.00% 2029 Senior Notes.

(b) Interest income for the three months ended March 31, 2023 includes $9 million of interest income related to tax settlements.

ASSET RETIREMENT OBLIGATIONS

At both March 31, 2023 and December 31, 2022, we had recorded liabilities of $26 million related to asset retirement obligations. These amounts are included in “Other liabilities.”

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LEASES

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

LEASES

LEASES The Company leases various real estate, including certain operating facilities, warehouses, office space and land. The Company also leases material handling equipment, vehicles and certain other equipment. The Company’s leases have a remaining lease term of up to 15 years. Total lease cost was $17 million and $15 million for the three months ended March 31, 2023 and 2022, respectively.

Supplemental Balance Sheet Information Related to Leases

In millions	Classification	March 31, 2023		December 31, 2022
Assets
Operating lease assets	Right of use assets	$	37	$	35
Finance lease assets	Plants, properties, and equipment, net (a)	24		24
Total leased assets		$	61	$	59
Liabilities
Current
Operating	Other current liabilities	$	14	$	13
Finance	Notes payable and current maturities of long-term debt	3		3
Noncurrent
Operating	Other Liabilities	30		28
Finance	Long-term debt	14		14
Total lease liabilities		$	61	$	58

(a)Finance leases are recorded net of accumulated amortization of $14 million and $13 million as of March 31, 2023 and December 31, 2022, respectively.

LEASES

LEASES The Company leases various real estate, including certain operating facilities, warehouses, office space and land. The Company also leases material handling equipment, vehicles and certain other equipment. The Company’s leases have a remaining lease term of up to 15 years. Total lease cost was $17 million and $15 million for the three months ended March 31, 2023 and 2022, respectively.

Supplemental Balance Sheet Information Related to Leases

In millions	Classification	March 31, 2023		December 31, 2022
Assets
Operating lease assets	Right of use assets	$	37	$	35
Finance lease assets	Plants, properties, and equipment, net (a)	24		24
Total leased assets		$	61	$	59
Liabilities
Current
Operating	Other current liabilities	$	14	$	13
Finance	Notes payable and current maturities of long-term debt	3		3
Noncurrent
Operating	Other Liabilities	30		28
Finance	Long-term debt	14		14
Total lease liabilities		$	61	$	58

(a)Finance leases are recorded net of accumulated amortization of $14 million and $13 million as of March 31, 2023 and December 31, 2022, respectively.

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GOODWILL AND OTHER INTANGIBLES

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLES

GOODWILL AND OTHER INTANGIBLES

Goodwill

The following table presents changes in the goodwill balance as allocated to each business segment for the three months ended March 31, 2023:

In millions	Europe		Latin America		North America		Total
Balance as of December 31, 2022
Goodwill	$	11	$	118	$	—	$	129
Accumulated impairment losses	(1)		—		—		(1)
	$	10	$	118	$	—	$	128
Currency translation and other (a)	—		5		—		5
Balance as of March 31, 2023
Goodwill	11		123		—		134
Accumulated impairment losses	(1)		—		—		(1)
Total	$	10	$	123	$	—	$	133

(a)Represents the effects of foreign currency translations and reclassifications.

Other Intangibles

Identifiable intangible assets comprised the following:

	March 31, 2023						December 31, 2022
In millions	Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets		Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets
Customer relationships and lists	$	56	$	(50)	$	6	$	56	$	(50)	$	6
Other	7		(6)		1		7		(6)		1
Total	$	63	$	(56)	$	7	$	63	$	(56)	$	7

Amortization expense related to intangibles was immaterial for each of the three month periods ended March 31, 2023 and 2022, respectively.

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INCOME TAXES

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

An income tax provision of $44 million and $26 million was recorded for the three months ended March 31, 2023 and March 31, 2022, and the reported effective income tax rate from continuing operations was 31% and 32%, respectively.

The Brazilian Federal Revenue Service has challenged the deductibility of goodwill amortization generated in a 2007 acquisition by International Paper do Brasil Ltda., now named Sylvamo do Brasil Ltda. (“Sylvamo Brasil”), a wholly-owned subsidiary of the Company (the “Brazil Tax Dispute”). Sylvamo Brasil received assessments for the tax years 2007-2015 totaling approximately $111 million in tax, and $375 million in interest, penalties and fees as of March 31, 2023 (adjusted for variation in currency exchange rates). International Paper challenged and is managing the litigation of this matter pursuant to the tax matters agreement between us and International Paper. After a previous favorable ruling challenging the basis for these assessments, there were subsequent unfavorable decisions from the Brazilian Administrative Council of Tax Appeals. On behalf of Sylvamo Brasil, International Paper has appealed and at present, has advised us that it intends to further appeal these and any future unfavorable administrative judgments to the Brazilian federal courts; however, this tax litigation matter may take many years to resolve. The Company believes that the transaction underlying these assessments was appropriately evaluated, and that the Company’s tax position would be sustained, based on Brazilian tax law.

Pursuant to the terms of the tax matters agreement entered into between International Paper and Sylvamo, International Paper will pay 60%, and Sylvamo will pay 40% on up to $300 million of any assessment related to this matter, and International Paper will pay all amounts of the assessment over $300 million. Also in connection with this agreement, all decisions concerning the conduct of the litigation related to this matter, including strategy settlement, pursuit and abandonment, will continue to be made by International Paper, which is vigorously defending Sylvamo Brasil’s historic tax position against the current assessments and any similar assessments that may be issued for tax years subsequent to 2015.

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COMMITMENTS AND CONTINGENT LIABILITIES

3 Months Ended

Mar. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENT LIABILITIES

COMMITMENTS AND CONTINGENT LIABILITIES

Environmental and Legal Proceedings

The Company is subject to environmental and legal proceedings in the countries in which we operate. Accruals for contingent liabilities, such as environmental remediation costs, are recorded in the condensed consolidated financial statements when it is probable that a liability has been incurred or an asset impaired and the amount of the loss can be reasonably estimated. The Company has estimated some probable liability associated with environmental remediation matters that is immaterial in the aggregate as of March 31, 2023.

At the Company’s Mogi Guaçu mill, there are legacy basin areas that were formerly lagoons used for treatment of mill wastewater from pulp and paper manufacturing. In coordination with and in response to a request by the Environmental Company of the State of São Paulo (“CETESB”), which is the state environmental regulatory authority, there has been continuous regulatory monitoring and sampling of the former basins, which began prior to their closure in 2006, both to assess for contamination and evaluate whether additional remediation is needed beyond the basins’ ongoing natural vegetation growth.

This monitoring and sampling detected metal contamination, with the main constituent of potential environmental impact being mercury. The Company has presented CETESB with proposals for studies and other actions to further assess the scope and type of contamination and the possible need for an additional remediation approach.

Additionally, in October 2022, CETESB requested that the Company expand its efforts to include providing CETESB with a proposed pilot intervention (remediation) plan for a portion of the former basins. The purpose of the pilot intervention plan is to facilitate determination of the appropriate actions to take for the basins generally, guided by the results of the pilot intervention plan in the subset of basins. The Company has submitted its pilot invention plan to CETESB and is waiting for CETESB to determine if it approves the plan set forth in the response.

As of March 31, 2023, the Company has recorded an immaterial liability for the ongoing and additional environmental studies and sampling of the basins. While this matter could in the future have a material impact on our results of operations or cash flows, the Company is unable to estimate its potential additional liability, including the costs of executing certain elements of the proposed pilot intervention plan, because the further studies to be conducted and the remediation that may be required, both for the pilot intervention plan and for the ultimate intervention, will depend on CETESB’s approval of the proposed pilot intervention plan, the results of the pilot intervention plan, the Company’s environmental studies assessing the existence of ecological risk due to the contamination and what intervention may be required beyond vegetation of the basins, the extent to which there is eventual risk of harm from the contamination, and CETESB’s approval of any ultimate intervention plan for the basins.

Taxes Other Than Payroll Taxes

See Note 12 Income Taxes for a discussion of a goodwill amortization tax matter in Brazil.

In the first quarter of 2023, the Company reached an amnesty agreement with the Brazilian government related to certain VAT amounts assessed in prior years. This agreement resulted in the recognition of $9 million of interest income during the period.

We have other open tax matters awaiting resolution in Brazil, which are at various stages of review in various administrative and judicial proceedings. We routinely assess these tax matters for materiality and probability of loss or gain, and appropriate amounts have been recorded in our financial statements for any open items where the risk of loss is deemed probable. We currently do not consider any of these other tax matters to be material individually. However, it is reasonably possible that settlement of any of these matters concurrently could result in a material loss or that over time a matter could become material, for example, if interest were accruing on the amount at issue for a significant period of time. Also, future exchange rate fluctuations could be unfavorable to the U.S. dollar and significant enough to cause an open matter to become material. The expected timing for resolution of these open matters ranges from one year to ten years.

General

The Company is involved in various other inquiries, administrative proceedings and litigation relating to environmental and safety matters, taxes (including VAT), personal injury, product liability, labor and employment, contracts, sales of property and other matters, some of which allege substantial monetary damages. Assessments of lawsuits and claims can involve a series of complex judgments about future events, can rely heavily on estimates and assumptions, and are otherwise subject to significant uncertainties. As a result, there can be no certainty that the Company will not ultimately incur charges in excess of presently recorded liabilities. The Company believes that loss contingencies arising from pending matters, including the matters described herein, will not have a material effect on the consolidated financial position or liquidity of the Company. However, in light of the inherent uncertainties involved in pending or threatened legal matters, some of which are beyond the Company's control, and the large or indeterminate damages sought in some of these matters, a future adverse ruling, settlement, unfavorable development, or increase in accruals with respect to these matters, could result in future charges that could be material to the Company's results of operations or cash flows in any particular reporting period.

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LONG-TERM DEBT

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

LONG-TERM DEBT

LONG-TERM DEBT

Long-term debt is summarized in the following table:

In millions	March 31, 2023		December 31, 2022
Term Loan F - due 2027 (a)	$	490	$	496
Term Loan A - due 2028 (b)	297		—
7.00% Senior Notes - due 2029 (c)	89		444
Securitization Program	105		75
Other	17		17
Less: current portion	(44)		(29)
Total	$	954	$	1,003

(a) As of March 31, 2023 and December 31, 2022, presented net of $4 million and $4 million in unamortized debt issuance costs, respectively.

(b) As of March 31, 2023 presented net of $3 million in unamortized debt issuance costs.

(c) As of March 31, 2023 and December 31, 2022, presented net of $1 million and $6 million in unamortized original issue discount paid, respectively.

In addition to the debt noted above, the Company has the ability to access a cash flow-based revolving credit facility with a total borrowing capacity of $450 million (“Revolving Credit Facility”), which matures in 2026. As of March 31, 2023, the Company had $60 million outstanding borrowings on the Revolving Credit Facility and $24 million of letters of credit related to the Revolving Credit Facility, resulting in an available borrowing capacity of $366 million. As of December 31, 2022, the Company had no outstanding borrowings on the Revolving Credit Facility and $24 million of letters of credit related to the Revolving Credit Facility, resulting in an available borrowing capacity of $426 million. The outstanding borrowings on the Revolving Credit Facility are recorded within “Notes payable and current maturities of long-term debt” in the condensed consolidated balance sheet.

In the first quarter of 2023, the Company announced the commencement of a cash tender offer to purchase any and all of the Company’s outstanding 2029 Senior Notes. The Company also solicited consents from holders of the 2029 Senior Notes to amend certain provisions of the indenture with respect to the notes. In connection with the tender offer and the consent solicitation, the Company entered into a new senior secured term loan facility amendment which provided an aggregate principal amount of $300 million (“Term Loan A”) maturing in 2028. Term Loan A, together with $60 million borrowings under the Revolving Credit Facility, were used to pay the total consideration for all notes tendered in the tender offer, plus accrued interest and all fees and expenses incurred in connection with the tender offer and consent solicitation. As of March 31, 2023, $360 million aggregate principal of the notes were tendered, resulting in a debt extinguishment cost of $5 million, which includes the write-off of debt issuance costs. This cost was recorded within “Interest expense (income), net.”

Sylvamo North America LLC, a wholly owned subsidiary of the Company, maintains a $120 million accounts receivable finance facility (the “Securitization Program”), maturing in 2025. The Company sells substantially all of its North American accounts receivable balances to Sylvamo Receivables, LLC, a special purpose entity, which pledges the receivables as collateral for the Securitization Program. The borrowing availability under this facility is limited by the balance of eligible receivables within the program. As of March 31, 2023 and December 31, 2022, the Company had $105 million and $75 million outstanding borrowings under the receivables securitization program, respectively. The average interest rate for the quarters ended March 31, 2023 and December 31, 2022 was 5.34% and 5.19%, respectively.

The 2029 Senior Notes are unsecured bonds with a 7.00% fixed interest rate, payable semi-annually. The obligations under the Term Loan F, Term Loan A and Revolving Credit Facility are secured by substantially all the tangible and intangible assets of Sylvamo and its subsidiaries, subject to certain exceptions, and along with the 2029 Senior Notes facility are guaranteed by Sylvamo and certain subsidiaries. The interest rates applicable to the Term Loan F and Revolving Credit Facility are based on a fluctuating rate of interest measured by reference to LIBOR plus a fixed percentage of 1.75%, and 1.50%, respectively, payable monthly, with a LIBOR floor of 0.00%. The interest rate applicable to the Term Loan A is based on a fluctuating rate of interest measured in reference to SOFR plus a fixed percentage of 1.85%, subject to a SOFR floor of 0.00%

We are receiving interest patronage credits under the Term Loan F. Patronage distributions, which are made primarily in cash but also in equity in the lenders, are generally received in the first quarter of the year following that in which they were earned. Expected patronage credits are accrued in accounts and notes receivable as a reduction to interest expense in the period earned. After giving effect to expected patronage distributions of 90 basis points, of which 70 basis points is expected as a cash rebate, the effective net interest rate on the Term Loan F was approximately 5.69% and 5.23% as of March 31, 2023 and December 31, 2022, respectively.

In connection with the Term Loan F, the Company entered into interest rate swaps with various counterparties with a notional amount of $400 million and maturities ranging from 2024 to 2026. In the first quarter, the Company received cash proceeds of $12 million from the unwind of four interest rate swaps maturing in 2024, with a total notional amount of $200 million. Subsequently, the Company entered into four new interest rate swaps with various counter parties with a notional amount of $200 million, which mature in 2025. The related gain has been deferred within “Accumulated other comprehensive loss” in the condensed consolidated balance sheet and will be amortized over the contracts’ original term of two remaining years. These interest rate swaps are designated as cash flow hedges, and are utilized to manage interest rate risk. The interest rate swaps allow for the Company to exchange the difference in the variable rates on Term Loan F determined in reference to LIBOR and the fixed interest rate per notional amount ranging from 1.30% to 3.85%.

As of March 31, 2023 and December 31, 2022, the fair value of the interest rate swaps related to Term Loan F was an asset of $14 million and $30 million, respectively. Assets resulting from interest rate swaps are reflected in “Deferred charges and other assets.”

In connection with the issuance of Term Loan A, the Company entered into interest rate swaps with a notional amount of $300 million and maturities in 2028. These interest rate swaps allow for the Company to exchange the difference in the variable rates on Term Loan A determined in reference to SOFR and the fixed interest rate per notional amount ranging from 4.13% to 4.16%. As of March 31, 2023, the fair value of these interest rate swaps resulted in a liability of $9 million, recorded within “Other liabilities.”

The Company is subject to certain covenants limiting, among other things, the ability of most of its subsidiaries to: (a) incur additional indebtedness or issue certain preferred shares; (b) pay dividends on or make distributions in respect of the Company’s or its subsidiaries’ capital stock or make investments or other restricted payments; (c) create restrictions on the ability of the Company’s restricted subsidiaries to pay dividends to the Company or make certain other intercompany transfers; (d) sell certain assets; (e) create liens; (f) consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets; and (g) enter into certain transactions with its affiliates. The Company is currently subject to a maximum consolidated total leverage ratio of 3.75 to 1.00.

The limit on restricted payments that we may make prior to the resolution of the Brazil Tax Dispute is $60 million if our pro-forma consolidated leverage ratio is less than 2.50 to 1.00 and greater than or equal to 2.00 to 1.00, or $90 million if the pro-forma consolidated leverage ratio is less than 2.00 to 1.00. However, limitations imposed on restricted payments are eliminated prior to the final settlement of the Brazil Tax Dispute if (i) we deposit $120 million in an account subject to the control of the administrative agent under our credit agreement, or (ii) we deposit $60 million in such an account and maintain $225 million of available liquidity at the time we make restricted payments. The funds deposited in the account would be used to pay the Company’s share of the settlement of the Brazil Tax Dispute, with any excess funds returned to us if our portion of any final settlement amount is less than the amount on deposit. If we meet these conditions, our ability to make restricted payments under the credit agreement would then be governed by the provisions in the credit agreement in effect when the Brazil Tax Dispute is settled.

As of March 31, 2023, we were in compliance with our debt covenants.

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PENSION AND POSTRETIREMENT BENEFIT PLANS

3 Months Ended

Mar. 31, 2023

Retirement Benefits [Abstract]

PENSION AND POSTRETIREMENT BENEFIT PLANS

PENSION AND POSTRETIREMENT BENEFIT PLANS

Defined Benefit Plans

The Company sponsors and maintains pension plans for the benefit of certain of the Company’s employees. The service and non-service cost components of net periodic pension expense for these employees is recorded within cost of products sold and selling and administrative expenses. The assets and liabilities related to plans sponsored by the Company are reflected in deferred charges and other assets and other liabilities, respectively.

Net periodic pension expense (benefit) for all pension plans sponsored by the Company for the three months ended March 31, 2023 and March 31, 2022 was immaterial.

The Company’s funding policy for the pension plans is to contribute amounts sufficient to meet legal funding requirements, plus any additional amounts that the Company may determine to be appropriate considering the funded status of the plans, tax deductibility, cash flow generated by the Company, and other factors. The Company continually reassesses the amount and timing of any discretionary contributions. Generally, the non-U.S. pension plans are funded using the projected benefit as a target, except in certain countries where funding of benefit plans is not required.

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INCENTIVE PLANS

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

INCENTIVE PLANS

INCENTIVE PLANS

The Company has adopted the Sylvamo 2021 Incentive Compensation Plan, which includes shares under its long-term incentive plan (“LTIP”) that grants certain employees, consultants, or non-employee directors of the Company different forms of awards, including time-based and performance-based restricted stock units. As of March 31, 2023, 2,899,804 shares remain available for future grants.

Total stock-based compensation cost recognized by the Company was as follows:

	Three Months Ended March 31,
In millions	2023		2022
Total stock-based compensation expense (included in selling and administrative expense)	$	7	$	4

As of March 31, 2023, $30 million of compensation cost, net of estimated forfeitures, related to all stock-based compensation arrangements for Company employees had not yet been recognized. This amount will be recognized in expense over a weighted-average period of 1.5 years.

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FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA

FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA

The Company’s business segments, Europe, Latin America and North America, are consistent with the internal structure used to manage these businesses. All segments are differentiated on a common product, common customer basis, consistent with the business segmentation generally used in the Forest Products industry.

Business segment operating profit is used by the Company’s management to measure the earnings performance of its businesses. Management believes that this measure provides investors and analysts useful insights into our operating performance. Business segment operating profit is defined as income from continuing operations before income taxes, excluding interest (income) expense, net, and net special items.

External sales are defined as those that are made to parties outside the Company’s combined group, whereas sales by segment in the Net Sales table are determined using a management approach and include intersegment sales.

Information By Business Segment

Net Sales

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	248	$	117
Latin America	222		215
North America	505		508
Intersegment Sales	(16)		(19)
Net Sales	$	959	$	821

Business Segment Operating Profit

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	23	$	2
Latin America	46		39
North America	97		62
Business Segment Operating Profit	$	166	$	103
Income from continuing operations before income taxes	$	141	$	81
Interest (income) expense, net	7		17
Net special items expense (income) (a)	18		5
Business Segment Operating Profit	$	166	$	103

(a) Special items represent income or expenses that are incurred periodically, rather than on a regular basis. Net special items in the periods presented primarily include transaction costs related to the Nymölla acquisition, professional and legal fees related to negotiations resulting in a shareholder cooperation agreement, the impact of the step-up of acquired Nymölla inventory sold during the quarter and one-time costs associated with the spin-off.

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RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2023

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

Prior to the spin-off on October 1, 2021, we historically operated as part of International Paper and not as a standalone company. As a result of the spin-off on October 1, 2021, Sylvamo became an independent public company. On September 12, 2022, International Paper sold its remaining shares of Sylvamo stock. Therefore, International Paper is no longer a related party. The following discussion summarizes activity between the Company and International Paper both prior and subsequent to the spin-off and up to the time International Paper was deemed to no longer be a related party.

Related Party Sales and Purchases

The Company purchases certain of its products from International Paper which are produced in facilities that remained with International Paper. The Company continues to purchase uncoated freesheet and bristols pursuant to offtake agreements between the Company and International Paper. The Company purchased inventory associated with the offtake agreements of $149 million for the three months ended March 31, 2022.

The Company purchases fiber pursuant to fiber purchase agreements between the Company and International Paper. The Company purchased inventory associated with the fiber supply agreements of $49 million for the three months ended March 31, 2022.

The Company also purchases certain packaging materials from International Paper. These packaging purchases totaled $4 million for the three months ended March 31, 2022.

Transition Services Agreement

Pursuant to the Transition Services Agreement, International Paper and Sylvamo provided certain services to one another on an interim, transitional basis. The services included certain information technology services, finance and accounting services and human resources and employee benefits services. The agreed-upon charges for such services were generally intended to allow the providing company to recover all costs and expenses for providing such services. The total amount of expenses incurred by the Company under the Transition Services Agreement for the three months ended March 31, 2022 was $8 million. The Company is no longer receiving services under this agreement as of October 1, 2022.

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REVENUE RECOGNITION (Tables)

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

External net sales by major products

External net sales by major products were as follows by business segment:

	Three Months Ended March 31,
In millions	2023		2022
Europe
Uncoated Papers	$	221	$	90
Market Pulp	27		27
Europe	248		117
Latin America (a)
Uncoated Papers	186		181
Market Pulp	20		15
Latin America	206		196
North America
Uncoated Papers	487		486
Market Pulp	18		22
North America	505		508
Total	$	959	$	821

(a) Prior period amounts have been corrected to reflect market pulp sales

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EQUITY (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Summary of changes in equity

A summary of changes in equity for the three months ended March 31, 2023 and 2022 is provided below:

Three Months Ended March 31, 2023
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2022	44	$	44	$	25	$	2,029	$	(1,338)	$	(82)	$	678
Stock-based employee compensation	—	—		7		—		—		(5)		2
Share repurchases	—	—		—		—		—		(10)		(10)
Dividends ($0.25 per share)	—	—		—		(10)		—		—		(10)
Comprehensive income (loss)	—	—		—		97		33		—		130
Balance, March 31, 2023	44	$	44	$	32	$	2,116	$	(1,305)	$	(97)	$	790

Three Months Ended March 31, 2022
In millions	Shares	Common Stock		Paid-In Capital		Retained Earnings		Accumulated  Other Comprehensive Loss		Common Stock Held In Treasury, At Cost		Total Equity
Balance, December 31, 2021	44	$	44	$	4	$	1,935	$	(1,801)	$	—	$	182
Stock-based employee compensation	—	—		4		—		—		(2)		2
Comprehensive income (loss)	—	—		—		26		121		—		147
Balance, March 31, 2022	44	$	44	$	8	$	1,961	$	(1,680)	$	(2)	$	331

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OTHER COMPREHENSIVE INCOME (Tables)

3 Months Ended

Mar. 31, 2023

Equity [Abstract]

Changes in Accumulated other comprehensive income (loss) (“AOCI”), net of tax

The following table presents the changes in Accumulated Other Comprehensive Income (Loss) (“AOCI”), net of taxes, reported in the condensed consolidated financial statements:

	Three Months Ended March 31,
In millions	2023		2022
Defined Benefit Pension and Postretirement Adjustments
Balance at beginning of period	$	(76)	$	(80)
Amounts reclassified from accumulated other comprehensive income	—		(1)
Balance at end of period	(76)		(81)
Change in Cumulative Foreign Currency Translation Adjustments
Balance at beginning of period	(1,288)		(1,719)
Other comprehensive income (loss) before reclassifications	41		99
Balance at end of period	(1,247)		(1,620)
Net Gains and Losses on Cash Flow Hedging Derivatives
Balance at beginning of period	26		(2)
Other comprehensive income (loss) before reclassifications	(4)		29
Amounts reclassified from accumulated other comprehensive income	(4)		(6)
Balance at end of period	18		21
Total Accumulated Other Comprehensive Income (Loss) at End of Period	$	(1,305)	$	(1,680)

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EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Earnings Per Share

Basic and diluted earnings per share from continuing operations are calculated as follows:

	Three Months Ended March 31,
In millions, except per share amounts	2023		2022
Net income from continuing operations	$	97	$	55
Weighted average common shares outstanding	42.5		44.0
Effect of dilutive securities	0.6		0.2
Weighted average common shares outstanding - assuming dilution	43.1		44.2
Earnings per share from continuing operations - basic	$	2.28	$	1.25
Earnings per share from continuing operations - diluted	$	2.25	$	1.25

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ACQUISITIONS (Tables)

3 Months Ended

Mar. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary allocation of the purchase price to the fair value assigned to assets and liabilities acquired as of January 2, 2023:

In millions
Accounts receivable	$	63
Inventory	67
Plants, properties and equipment	118
Other assets	2
Total assets acquired	250
Accounts payable	61
Other liabilities	22
Total liabilities assumed	83
Net assets acquired	$	167

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DIVESTITURE AND IMPAIRMENT OF BUSINESS (Tables)

3 Months Ended

Mar. 31, 2023

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Cash Flow

The following summarizes the major classes of line items comprising Income (Loss) Before Income Taxes reconciled to Discontinued Operations, net of taxes, related to the Russian operations for all periods presented in the condensed consolidated statement of operations.

	Three Months Ended March 31,
In millions	2022
NET SALES	$	156
COSTS AND EXPENSES
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	113
Selling and administrative expenses	1
Depreciation, amortization and cost of timber harvested	4
Taxes other than payroll and income taxes	—
Impairment of business	68
Interest (income) expense, net	(1)
INCOME (LOSS) BEFORE INCOME TAXES	(29)
Income tax provision (benefit)	—
DISCONTINUED OPERATIONS, NET OF TAXES	$	(29)

The following summarizes the total cash provided by operating activities from discontinued operations, net and total cash provided by (used for) investing activities from discontinued operations, net and included in the condensed consolidated statement of cash flows:

In millions for the three months ended March 31	2022
Cash Provided by Operating Activities	$	44
Cash Provided by (Used for) Investment Activities (a)	$	(3)

(a) Includes cash invested in capital projects of $3 million.

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION (Tables)

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Accounts and Notes Receivable Net

Accounts and notes receivable, net, by classification were:

In millions	March 31, 2023		December 31, 2022
Accounts and notes receivable:
Trade	$	416	$	430
Notes and other	25		20
Total	$	441	$	450

Schedule of Inventories

In millions	March 31, 2023		December 31, 2022
Raw materials	$	87	$	40
Finished paper and pulp products	302		226
Operating supplies	94		78
Other	23		20
Total	$	506	$	364

Schedule of Interest Expense

Amounts related to interest were as follows:

	Three Months Ended March 31,
In millions	2023		2022
Interest expense (a)	$	19	$	18
Interest income (b)	(11)		(1)
Capitalized interest cost	(1)		—
Total	$	7	$	17

(a)    Interest expense for the three months ended March 31, 2023 includes $5 million of debt extinguishment cost related to the tender offer for our 7.00% 2029 Senior Notes.

(b) Interest income for the three months ended March 31, 2023 includes $9 million of interest income related to tax settlements.

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LEASES (Tables)

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Schedule of Supplemental Balance Sheet Information Related To Leases

Supplemental Balance Sheet Information Related to Leases

In millions	Classification	March 31, 2023		December 31, 2022
Assets
Operating lease assets	Right of use assets	$	37	$	35
Finance lease assets	Plants, properties, and equipment, net (a)	24		24
Total leased assets		$	61	$	59
Liabilities
Current
Operating	Other current liabilities	$	14	$	13
Finance	Notes payable and current maturities of long-term debt	3		3
Noncurrent
Operating	Other Liabilities	30		28
Finance	Long-term debt	14		14
Total lease liabilities		$	61	$	58

(a)Finance leases are recorded net of accumulated amortization of $14 million and $13 million as of March 31, 2023 and December 31, 2022, respectively.

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GOODWILL AND OTHER INTANGIBLES (Tables)

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Changes in the Goodwill

The following table presents changes in the goodwill balance as allocated to each business segment for the three months ended March 31, 2023:

In millions	Europe		Latin America		North America		Total
Balance as of December 31, 2022
Goodwill	$	11	$	118	$	—	$	129
Accumulated impairment losses	(1)		—		—		(1)
	$	10	$	118	$	—	$	128
Currency translation and other (a)	—		5		—		5
Balance as of March 31, 2023
Goodwill	11		123		—		134
Accumulated impairment losses	(1)		—		—		(1)
Total	$	10	$	123	$	—	$	133

(a)Represents the effects of foreign currency translations and reclassifications.

Schedule of Identifiable Intangible Assets

Identifiable intangible assets comprised the following:

	March 31, 2023						December 31, 2022
In millions	Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets		Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets
Customer relationships and lists	$	56	$	(50)	$	6	$	56	$	(50)	$	6
Other	7		(6)		1		7		(6)		1
Total	$	63	$	(56)	$	7	$	63	$	(56)	$	7

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LONG-TERM DEBT (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

Long-term debt is summarized in the following table:

In millions	March 31, 2023		December 31, 2022
Term Loan F - due 2027 (a)	$	490	$	496
Term Loan A - due 2028 (b)	297		—
7.00% Senior Notes - due 2029 (c)	89		444
Securitization Program	105		75
Other	17		17
Less: current portion	(44)		(29)
Total	$	954	$	1,003

(a) As of March 31, 2023 and December 31, 2022, presented net of $4 million and $4 million in unamortized debt issuance costs, respectively.

(b) As of March 31, 2023 presented net of $3 million in unamortized debt issuance costs.

(c) As of March 31, 2023 and December 31, 2022, presented net of $1 million and $6 million in unamortized original issue discount paid, respectively.

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INCENTIVE PLANS (Tables)

3 Months Ended

Mar. 31, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Stock Based Compensation Cost Recognized

Total stock-based compensation cost recognized by the Company was as follows:

	Three Months Ended March 31,
In millions	2023		2022
Total stock-based compensation expense (included in selling and administrative expense)	$	7	$	4

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FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA (Tables)

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Schedule of Segment Reporting

Information By Business Segment

Net Sales

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	248	$	117
Latin America	222		215
North America	505		508
Intersegment Sales	(16)		(19)
Net Sales	$	959	$	821

Business Segment Operating Profit

	Three Months Ended March 31,
In millions	2023		2022
Europe	$	23	$	2
Latin America	46		39
North America	97		62
Business Segment Operating Profit	$	166	$	103
Income from continuing operations before income taxes	$	141	$	81
Interest (income) expense, net	7		17
Net special items expense (income) (a)	18		5
Business Segment Operating Profit	$	166	$	103

(a) Special items represent income or expenses that are incurred periodically, rather than on a regular basis. Net special items in the periods presented primarily include transaction costs related to the Nymölla acquisition, professional and legal fees related to negotiations resulting in a shareholder cooperation agreement, the impact of the step-up of acquired Nymölla inventory sold during the quarter and one-time costs associated with the spin-off.

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REVENUE RECOGNITION (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue from External Customer [Line Items]
NET SALES	$ 959	$ 821
Contract liabilities	3
Europe
Revenue from External Customer [Line Items]
NET SALES	248	117
Latin America
Revenue from External Customer [Line Items]
NET SALES	206	196
North America
Revenue from External Customer [Line Items]
NET SALES	505	508
Uncoated Papers | Europe
Revenue from External Customer [Line Items]
NET SALES	221	90
Uncoated Papers | Latin America
Revenue from External Customer [Line Items]
NET SALES	186	181
Uncoated Papers | North America
Revenue from External Customer [Line Items]
NET SALES	487	486
Market Pulp | Europe
Revenue from External Customer [Line Items]
NET SALES	27	27
Market Pulp | Latin America
Revenue from External Customer [Line Items]
NET SALES	20	15
Market Pulp | North America
Revenue from External Customer [Line Items]
NET SALES	$ 18	$ 22

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EQUITY - Summary of Changes In Equity (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance (in shares)	42,600,000
Beginning balance	$ 678	$ 182
Stock-based employee compensation	2	2
Stock Repurchased During Period, Value	(10)
Dividends	(10)
Comprehensive income (loss)	$ 130	147
Ending balance (in shares)	42,600,000
Ending balance	$ 790	$ 331
Dividends per share (in dollars per share)	$ 0.25
Common Stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance (in shares)	44,000,000	44,000,000
Beginning balance	$ 44	$ 44
Ending balance (in shares)	44,000,000	44,000,000
Ending balance	$ 44	$ 44
Paid-In Capital
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	25	4
Stock-based employee compensation	7	4
Ending balance	32	8
Retained Earnings
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	2,029	1,935
Dividends	(10)
Comprehensive income (loss)	97	26
Ending balance	2,116	1,961
Accumulated  Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	(1,338)	(1,801)
Stock-based employee compensation	0	0
Comprehensive income (loss)	33	121
Ending balance	(1,305)	(1,680)
Common Stock Held In Treasury, At Cost
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	(82)	0
Stock-based employee compensation	(5)	(2)
Stock Repurchased During Period, Value	(10)
Comprehensive income (loss)		0
Ending balance	$ (97)	$ (2)

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OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	$ 678	$ 182
Ending balance	790	331
Total Accumulated Other Comprehensive Income (Loss) at End of Period	790	331
Accumulated  Other Comprehensive Loss
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(1,338)	(1,801)
Ending balance	(1,305)	(1,680)
Total Accumulated Other Comprehensive Income (Loss) at End of Period	(1,305)	(1,680)
Defined Benefit Pension and Postretirement Adjustments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(76)	(80)
Amounts reclassified from accumulated other comprehensive income	0	(1)
Ending balance	(76)	(81)
Total Accumulated Other Comprehensive Income (Loss) at End of Period	(76)	(81)
Change in Cumulative Foreign Currency Translation Adjustments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(1,288)	(1,719)
Other comprehensive income (loss) before reclassifications	41	99
Ending balance	(1,247)	(1,620)
Total Accumulated Other Comprehensive Income (Loss) at End of Period	(1,247)	(1,620)
Net Gains and Losses on Cash Flow Hedging Derivatives
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	26	(2)
Amounts reclassified from accumulated other comprehensive income	(4)	(6)
Other comprehensive income (loss) before reclassifications	(4)	29
Ending balance	18	21
Total Accumulated Other Comprehensive Income (Loss) at End of Period	$ 18	$ 21

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EARNINGS PER SHARE - Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
NET INCOME FROM CONTINUING OPERATIONS	$ 97	$ 55
Weighted-average common shares outstanding - basic (in shares)	42.5	44.0
Effect of dilutive securities	0.6	0.2
Weighted-average common shares outstanding - diluted (in shares)	43.1	44.2
Earnings per share from continuing operations - basic (in dollars per share)	$ 2.28	$ 1.25
Earnings per share from continuing operations - diluted (in dollars per share)	$ 2.25	$ 1.25

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ACQUISITIONS (Details) - Nymolla $ in Millions	Jan. 02, 2023 USD ($)
Business Acquisition [Line Items]
Accounts receivable	$ 63
Inventory	67
Plants, properties and equipment	118
Other assets	2
Total assets acquired	250
Accounts payable	61
Other liabilities	22
Total liabilities assumed	83
Net assets acquired	$ 167

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ACQUISITIONS Narrative (Details) € in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($)	Mar. 31, 2023 EUR (€)	Mar. 31, 2022 USD ($)	Jan. 02, 2023 paperMachines shortTons
Business Acquisition [Line Items]
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	$ 688		$ 620
Nymolla
Business Acquisition [Line Items]
Paper Machines | paperMachines				2
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Inventory	9
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual	100
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual	8
Business Acquisition, Pro Forma Revenue	926
Business Acquisition, Pro Forma Net Income (Loss)	83
Business Combination, Consideration Transferred	167	€ 157
Capacity, Short Tons | shortTons				500,000
Nymolla | Fair Value Adjustment to Inventory
Business Acquisition [Line Items]
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)	9
Cost of Goods and Service, Excluding Depreciation, Depletion and Amortization, Net of Tax	7
Nymolla | Selling, General and Administrative Expenses
Business Acquisition [Line Items]
Business Combination, Acquisition Related Costs	4
Business Combination, Acquisition Related Costs, Net of Tax	$ 3

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DIVESTITURE AND IMPAIRMENT OF BUSINESS - Consolidated Statement of Operations (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income from continuing operations before income taxes	$ 141	$ 81
Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
NET SALES		156
Cost of products sold (exclusive of depreciation, amortization and cost of timber harvested shown separately below)		113
Selling and administrative expenses		1
Depreciation, amortization and cost of timber harvested		4
Taxes other than payroll and income taxes		0
Impairment of business		68
Interest (income) expense, net		(1)
Income from continuing operations before income taxes		(29)
Income tax provision (benefit)		0
DISCONTINUED OPERATIONS, NET OF TAXES		$ (29)

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DIVESTITURE AND IMPAIRMENT OF BUSINESS - Consolidated Statement of Cash flows (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
CASH PROVIDED BY OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	$ 0	$ 44
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM DISCONTINUED OPERATIONS, NET	$ 0	(3)
Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
CASH PROVIDED BY OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS, NET		44
CASH PROVIDED BY (USED FOR) INVESTMENT ACTIVITIES FROM DISCONTINUED OPERATIONS, NET		(3)
Capital Expenditure, Discontinued Operations		$ 3

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DIVESTITURE AND IMPAIRMENT OF BUSINESS - Narrative (Details) - RUSSIAN FEDERATION $ in Millions	3 Months Ended
	Dec. 31, 2022 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Asset impairment	$ 68
Asset impairment charge, net of tax	57
Proceeds from Divestiture of Businesses	420
Foreign Exchange Costs and Transaction Fees	35
Proceeds from the Sale of Business Net of Foreign Currency Exchange and Transaction Fees	$ 385

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Temporary Investments (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Short-term Investments	$ 88	$ 80
Debt Instrument, interest rate, stated percentage	7.00%

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Schedule of Accounts and Notes Receivable, Net (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Trade	$ 416	$ 430
Notes and other	25	20
Total	$ 441	$ 450

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Expected Credit Losses (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Allowance for expected credit losses	$ 24	$ 20

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Inventories (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Raw materials	$ 87	$ 40
Finished paper and pulp products	302	226
Operating supplies	94	78
Other	23	20
Inventory net	$ 506	$ 364

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Plants, Property and Equipment, Net (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated depreciation	$ 3,700		$ 3,600
Depreciation	30	$ 25
Non-cash additions	$ 7		$ 36

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Interest (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Interest payments	$ 24	$ 25
Interest expense (a)	19	18
Interest income (b)	(11)	(1)
Capitalized interest cost	(1)	0
Total	7	$ 17
Payment for Debt Extinguishment or Debt Prepayment Cost	$ 5
Debt Instrument, interest rate, stated percentage	7.00%
Litigation Settlement Interest	$ 9

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SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION - Asset Retirement Obligations (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Asset Retirement Obligation	$ 26	$ 26

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LEASES - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Lessee, Lease, Description [Line Items]
Lease cost	$ 17	$ 15
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term	15 years

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LEASES - Balance Sheet Components (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Assets
Right of Use Assets	$ 37	$ 35
Finance lease assets	24	24
Total leased assets	61	59
Current
Operating	14	13
Finance	3	3
Noncurrent
Operating	30	28
Finance	14	14
Total lease liabilities	$ 61	$ 58
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Plants, Properties and Equipment, net	Plants, Properties and Equipment, net
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Other current liabilities	Other current liabilities
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Notes payable and current maturities of long-term debt	Notes payable and current maturities of long-term debt
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Other Liabilities	Other Liabilities
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Long-Term Debt and Lease Obligation	Long-Term Debt and Lease Obligation
Finance lease, accumulated amortization	$ 14	$ 13

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GOODWILL AND OTHER INTANGIBLES - Changes in the Goodwill Balance as Allocated to Each Business Segment (Details) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($)
Goodwill [Roll Forward]
Goodwill gross beginning balance	$ 129
Accumulated impairment loss, beginning balance	(1)
Goodwill, beginning balance	128
Currency translation and other	5
Goodwill gross ending balance	134
Accumulated impairment loss, ending balance	(1)
Goodwill, ending balance	133
Europe
Goodwill [Roll Forward]
Goodwill gross beginning balance	11
Accumulated impairment loss, beginning balance	(1)
Goodwill, beginning balance	10
Currency translation and other	0
Goodwill gross ending balance	11
Accumulated impairment loss, ending balance	(1)
Goodwill, ending balance	10
Latin America
Goodwill [Roll Forward]
Goodwill gross beginning balance	118
Accumulated impairment loss, beginning balance	0
Goodwill, beginning balance	118
Currency translation and other	5
Goodwill gross ending balance	123
Accumulated impairment loss, ending balance	0
Goodwill, ending balance	123
North America
Goodwill [Roll Forward]
Goodwill gross beginning balance	0
Accumulated impairment loss, beginning balance	0
Goodwill, beginning balance	0
Currency translation and other	0
Goodwill gross ending balance	0
Accumulated impairment loss, ending balance	0
Goodwill, ending balance	$ 0

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GOODWILL AND OTHER INTANGIBLES - Identifiable Intangible Assets (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 63,000,000		$ 63,000,000
Accumulated Amortization	(56,000,000)		(56,000,000)
Net Intangible Assets	7,000,000		7,000,000
Amortization of Intangible Assets	0	$ 0
Customer relationships and lists
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	56,000,000		56,000,000
Accumulated Amortization	(50,000,000)		(50,000,000)
Net Intangible Assets	6,000,000		6,000,000
Other
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	7,000,000		7,000,000
Accumulated Amortization	(6,000,000)		(6,000,000)
Net Intangible Assets	$ 1,000,000		$ 1,000,000

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INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Examination [Line Items]
Income tax provision	$ 44	$ 26
Effective income tax rate reconciliation, percent	31.00%	32.00%
Income tax examination, estimate of possible loss	$ 111
Income tax examination, penalties and interest expense	$ 375
Income tax examination, tax liabilities payable, percentage	40.00%
Income tax examination, tax liability, threshold	$ 300
International Paper
Income Tax Examination [Line Items]
Income tax examination, tax liabilities payable, percentage	60.00%

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COMMITMENTS AND CONTINGENT LIABILITIES (Details) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($)
Site Contingency [Line Items]
Litigation Settlement Interest	$ 9
BRAZIL
Site Contingency [Line Items]
Litigation Settlement Interest	$ 9
Minimum
Site Contingency [Line Items]
Expected timing for resolution in open market, term	1 year
Maximum
Site Contingency [Line Items]
Expected timing for resolution in open market, term	10 years

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LONG-TERM DEBT - Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Debt Instrument, interest rate, stated percentage	7.00%
Payment for Debt Extinguishment or Debt Prepayment Cost	$ 5,000,000
Debt Instrument, Consolidated Total, Maximum Leverage Ratio	375.00%
Ration Below 2.50
Debt Instrument [Line Items]
Debt Instrument, Consolidated Total Leverage Ratio, Maximum	2.50
Ration Below 2.50 | Ratio Equal to Or Above 2.00
Debt Instrument [Line Items]
Maximum annual restricted payments	$ 60,000,000
Ratio Below 2.00
Debt Instrument [Line Items]
Income Tax Examination, Maximum Annual Restricted Payments Increase	$ 90,000,000
Debt Instrument, Consolidated Total Leverage Ratio, Maximum	2.00
Ratio Equal to Or Above 2.00
Debt Instrument [Line Items]
Debt Instrument, Consolidated Total Leverage Ratio, Minimum	2.00
Maximum Deposit Amount
Debt Instrument [Line Items]
Income Tax Examination, Deposit Amount With Credit Agreement Agent to Eliminate Maximum Annual Restricted Payments	$ 120,000,000
Minimum Deposit Amount
Debt Instrument [Line Items]
Income Tax Examination, Deposit Amount With Credit Agreement Agent to Eliminate Maximum Annual Restricted Payments	60,000,000
Available Liquidity
Debt Instrument [Line Items]
Income Tax Examination, Available Liquidity Required to Eliminate Limits on Maximum Annual Restricted Payments	225,000,000
Receivables Securitization Program
Debt Instrument [Line Items]
Total borrowing capacity	120,000,000
Long-term line of credit outstanding	$ 105,000,000	$ 75,000,000
Line of Credit Facility, Interest Rate at Period End	5.34%	5.19%
Term Loan A Due 2029 | Interest Rate Swap | Other Liabilities
Debt Instrument [Line Items]
Interest Rate Fair Value Hedge Liability at Fair Value		$ 9,000,000
Term Loan A Due 2029 | Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging | 2024 to 2026
Debt Instrument [Line Items]
Notional amount		300,000,000
Term Loan A Due 2029 | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum | Interest Rate Swap
Debt Instrument [Line Items]
Derivative, fixed interest rate	4.13%
Term Loan A Due 2029 | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Maximum | Interest Rate Swap
Debt Instrument [Line Items]
Derivative, fixed interest rate	4.16%
Term Loan F Due 2027 | Interest Rate Swap | Deferred Charges and Other Assets
Debt Instrument [Line Items]
Fair value of interest rate swaps	$ 14,000,000	30,000,000
Term Loan F Due 2027 | Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging | 2024
Debt Instrument [Line Items]
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimate of Time to Transfer	2 years
Number of Interest Rate Swaps Unwound	4
Notional Amount, Interest Rate Swaps, Unwound	$ 200,000,000
Term Loan F Due 2027 | Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging | 2024 to 2026
Debt Instrument [Line Items]
Notional amount		400,000,000
Swap Unwind, Cash Proceeds	12,000,000
Term Loan F Due 2027 | Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging | 2025
Debt Instrument [Line Items]
Notional amount	$ 200,000,000
Number of New Interest Rate Swaps	4
Term Loan F Due 2027 | London Interbank Offered Rate (LIBOR) Swap Rate | Minimum | Interest Rate Swap
Debt Instrument [Line Items]
Derivative, fixed interest rate	1.30%
Term Loan F Due 2027 | London Interbank Offered Rate (LIBOR) Swap Rate | Maximum | Interest Rate Swap
Debt Instrument [Line Items]
Derivative, fixed interest rate	3.85%
Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Total borrowing capacity	$ 450,000,000
Long-term line of credit outstanding	$ 60,000,000	0
Debt Instrument, interest rate, stated percentage	1.50%
Letters of Credit Outstanding, Amount	$ 24,000,000	24,000,000
Line of Credit Facility, Remaining Borrowing Capacity	$ 366,000,000	$ 426,000,000
Line of Credit | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	0.00%
Senior Notes | Seven Percent Senior Notes Due 2029
Debt Instrument [Line Items]
Debt Instrument, interest rate, stated percentage	7.00%
Debt Instrument, Repaid, Principal	$ 360,000,000
Senior Notes | Seven Percent Senior Notes Due 2029 | Interest (expense) income
Debt Instrument [Line Items]
Payment for Debt Extinguishment or Debt Prepayment Cost	$ 5,000,000
Secured Debt | Term Loan F Notes Due 2027
Debt Instrument [Line Items]
Debt Instrument, interest rate, stated percentage	1.75%
Debt instrument, patronage distributions, percentage	0.90%
Debt instrument, patronage distributions, cash rebate, percentage	0.70%
Debt instrument, effective interest rate	5.69%	5.23%
Secured Debt | Term Loan F Notes Due 2027 | London Interbank Offered Rate (LIBOR) | Minimum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	0.00%
Secured Debt | Term Loan A Due 2029
Debt Instrument [Line Items]
Debt Instrument, interest rate, stated percentage	1.85%
Debt Instrument, Issued, Principal	$ 300,000,000
Secured Debt | Term Loan A Due 2029 | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	0.00%

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LONG-TERM DEBT - Summary of Long-Term Debt (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Less: current portion	$ (44)	$ (29)
Long-Term Debt	$ 954	1,003
Debt Instrument, interest rate, stated percentage	7.00%
Other Long-Term Debt
Debt Instrument [Line Items]
Long-term debt	$ 17	17
Term Loan F Due 2027 | Secured Debt
Debt Instrument [Line Items]
Long-term debt	490	496
Unamortized debt issuance costs	4	4
Seven Percent Senior Notes Due 2029 | Senior Notes
Debt Instrument [Line Items]
Long-term debt	$ 89	444
Debt Instrument, interest rate, stated percentage	7.00%
Unamortized original issue discount	$ 1	6
Receivables Securitization Program
Debt Instrument [Line Items]
Long-term debt	105	75
Term Loan A Due 2029 | Secured Debt
Debt Instrument [Line Items]
Long-term debt	$ 297	$ 0
Debt Instrument, interest rate, stated percentage	1.85%
Unamortized debt issuance costs	$ 3

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INCENTIVE PLANS - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2023 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation cost | $	$ 30
Vesting period	1 year 6 months
Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Available for future grant (in shares) | shares	2,899,804

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INCENTIVE PLANS - Summary of Stock Based Compensation Cost (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-Based Payment Arrangement [Abstract]
Total stock-based compensation expense (included in selling and administrative expense)	$ 7	$ 4

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FINANCIAL INFORMATION BY BUSINESS SEGMENT AND GEOGRAPHIC AREA (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Net Sales	$ 959	$ 821
Income from continuing operations before income taxes	141	81
Interest (income) expense, net	7	17
Europe
Segment Reporting Information [Line Items]
Net Sales	248	117
Latin America
Segment Reporting Information [Line Items]
Net Sales	206	196
North America
Segment Reporting Information [Line Items]
Net Sales	505	508
Operating Segments
Segment Reporting Information [Line Items]
Business Segment Operating Profit	166	103
Operating Segments | Europe
Segment Reporting Information [Line Items]
Net Sales	248	117
Business Segment Operating Profit	23	2
Operating Segments | Latin America
Segment Reporting Information [Line Items]
Net Sales	222	215
Business Segment Operating Profit	46	39
Operating Segments | North America
Segment Reporting Information [Line Items]
Net Sales	505	508
Business Segment Operating Profit	97	62
Intersegment Sales
Segment Reporting Information [Line Items]
Net Sales	(16)	(19)
Segment Reconciling Items
Segment Reporting Information [Line Items]
Interest (income) expense, net	7	17
Net special items expense (income) (a)	$ 18	$ 5

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RELATED PARTY TRANSACTIONS - Narrative (Details) - International Paper - Affiliated Entity $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($)
Offtake Agreement
Related Party Transaction [Line Items]
Related party transaction, expenses from related party	$ 149
Fiber Purchase Agreement
Related Party Transaction [Line Items]
Related party transaction, expenses from related party	49
Transition Services Agreement
Related Party Transaction [Line Items]
Other Expenses	8
Packaging
Related Party Transaction [Line Items]
Related party transaction, expenses from related party	$ 4