Good morning, and welcome to Rayonier Advanced Materials First Quarter 2018 Earnings Conference Call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions with instructions to follow at that time. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Mickey Walsh, Treasurer and Vice President of Investor Relations for Rayonier Advanced Materials. Thank you. Mr. Walsh, you may begin.

Thank you, operator and good morning everyone. Welcome again to Rayonier Advanced Materials first quarter 2018 earnings conference call and webcast. Joining me on today's call are Paul Boynton, our Chairman, President, and Chief Executive Officer; and Frank Ruperto, our Chief Financial Officer and Senior Vice President of Finance and Strategy. Our earnings release and presentation materials were issued last evening and are available on our website at rayonieram.com. I'd like to remind you that in today's presentation, we will include forward-looking statements made pursuant to the Safe Harbor provisions of federal securities laws. Our earnings release, as well as our filings with the SEC lists some of the factors which may cause actual results to differ materially from the forward-looking statements we may make. They are also referenced on slide 2 of our presentation material. Today's presentation will also reference certain non-GAAP financial measures, as noted on slide 3 of our presentation. We believe non-GAAP financial measures provide useful information for management and investors, but non-GAAP measures should not be considered an alternative to GAAP measures. A reconciliation of these measures to their most directly comparable GAAP financial measures are included on slide 16 through 19 of our presentation. I'll now turn the call over to Paul.

Thank you, Mickey and good morning everyone. I'm going to start the call today with the highlights of the quarter before turning it over to Frank to review our financial results. I will then conclude with an update on our strategy to drive growth and value for the company. As summarized on page 4, for the first quarter, we reported EBITDA of $86 million on $522 million of revenue and EPS of $0.38 per share, a 153% increase from the prior year. Our first full quarter of operations following the acquisition of Tembec, clearly demonstrate the accretive benefits of the enhanced scale and diversity of our combined business, as the strength in our commodity segments offset largely temporary challenges in our High Purity Cellulose segment. High-yield pulp contributed significantly to the bottom line, while lumber delivered solid results despite the tariffs on sales into the United States. These positive market dynamics offset lower high-purity sales volumes, resulting from unplanned shutdowns at our Jesup facility to repair our chlorine dioxide generator, and at our Tartas, France facility due to issues with the sulfur (00:03:21). Additionally our first quarter financials were weakened by an unexpected spike in natural gas distribution costs during the unusually cold January. While we are disappointed with these production issues, I am confident that they are behind us. Looking forward, we expect robust pricing and profitability in our high-yield pulp and lumber businesses to remain at elevated levels through the near-term. Additionally, the integration of Tembec's operations is proceeding in line with our expectations, as we delivered $7 million of savings during the quarter and anticipate that these results will accelerate through the year, as we work to reach our $40 million target. Overall, I remain confident in our ability to execute on our strategic plan for the year. The second quarter is already off to a solid start, as we can see the results of our efforts to improve and drive incremental value for our shareholders. I will discuss some of these details after Frank reviews our financial results. Now, let me turn the call over to Frank for further discussion.

Thank you, Paul. I'll start by reviewing the quarterly results and outlook for each of our business segments. As outlined on slide 5, our largest segment is High Purity Cellulose where sales declined by $90 million as price increases were offset by a 12% decline in sales volumes. The lower sales volumes were largely driven by the production issues that Paul referenced in our Jesup and Tartas facilities, both of which have been addressed. EBITDA for the High Purity segment was $54 million, which compares to $77 million in the year ago quarter. The decline was largely attributable to our decreased sales volumes, combined with increased raw material costs. As Paul discussed, costs were impacted by a spike in supply and distribution costs for natural gas. The combination of our production issues and the spike in energy prices negatively impacted first quarter EBITDA by $15 million. Increased prices and chemical input costs also contributed significantly to the decline. Looking forward, cellulose specialty prices are anticipated to decline 4% to 5% in 2018 with flat to slightly lower sales volumes. That said, we expect profitability to improve over the balance of the year, given that our significant production issues have been resolved, energy prices have returned to normal levels and the second half strength we typically see in customer shipments. A portion of this order seasonality is driven by lighter shipments, as well as our annual maintenance outages which are performed in the first half of the year, including outages in the second quarter at Jesup, Tartas and Témiscaming. Overall, we expect higher profitability through the balance of the year. Turning to slide 6, sales in our Forest Products segment rose approximately 19%, largely driven by a 30% price increase for lumber products. EBITDA grew 50% to $12 million as compared…

Hey, thank you, Frank. Turning to slide 11. Our first quarter results demonstrate the benefit scale and diversification as resulting from our acquisition of Tembec. Importantly the integration is proceeding in line with our expectations and we remain confident in our goal of delivering $75 million of synergies and a total of $155 million of incremental EBITDA growth by the end of 2020 through the four pillars of our strategic framework. Turning to slide 12, the first pillar is our cost transformation where we have identified $100 million of incremental EBITDA growth through a combination of $25 million of incremental cost reductions in our legacy business and $75 million of synergies from the integration of Tembec. We expect to achieve a majority of these synergies by better leveraging the scale of the combined organization to drive value through our supply chain. We also drive process improvements across the entire organization, as we strive to deliver increased production yields, as well as achieve operational and manufacturing efficiencies Additionally, we have identified overlap across our organizations in the form of systems and spending which we will eliminate along with a focus on reducing general corporate overheads. With $7 million achieved in the quarter and detailed plans in place to capture a total of $40 million in 2018, we remain confident in our $100 million three-year cost transformation goal. Our second pillar is market optimization, where we have outlined a plan to deliver $15 million of EBITDA growth as we work to optimize our broader cellulose specialties product offering in global asset base, factoring in our customer needs and transportation efficiencies to drive higher value for our customers and our company. Here's an area where clearly greater scale and diversification allow us to deliver incremental value for shareholders. The third pillar of our…

Thank you. At this time, we'll be conducting a question-and-answer session. Our first question is from Paul Quinn with RBC Capital Markets. Please proceed.

Yeah, thanks very much and good morning guys.

Good morning, Paul.

Good morning.

Just, I guess a question just on specialty cellulose. It looks like in the quarter you've got one timers of $15 million that should come back in Q2, and it sounds like the favorable mix in Q2 that I guess decreasing mix is going to be more than offset by the increased volumes of when you don't have the production issues, so the balance should be stronger going forward?

So, yeah, Paul. Look, obviously we (00:17:35) in the first quarter on some operational issues. Again, we strongly believe those are behind us and with that we're going to see better quarters (00:17:45) for the balance of the year. So, yes.

Okay. And how big was the chemical cost increase in the quarter, quarter-over-quarter.

The chemical cost was roughly $6 million increase quarter-over-quarter; actually, quarter 2017 over quarter 2018.

Okay, year-over-year.

Yeah.

And then, you outlined that $30 million in duties you expect on the lumber side, what do you expect for newsprint in 2018 here?

It's hard to say exactly, right now, where the team is prepared to move most of our volume to export markets and we think we can do that as I noted without lot of cost or any implications to our EBITDA. But what we're currently seeing is our U.S. customers have been willing to pay our current price levels. And so, again, it all depends on that timing of if they get to a point where they can get alternative supply, we'll move quickly to the export market. So Paul, it's hard to put a number on it. So from an EBITDA perspective though, we think it's going to be remain relatively consistent, whether in one or the other, so can't tell you exactly where the tariff is going to be.

Okay. And then there's a lot of targets and moving parts here with all the – your cost transformation optimization and production et cetera. The $7 million in savings you guided as of the $40 million target, so I'm confused by the $50 million target on I guess with the slide 12 here in 2018 was $50 million, what's the extra $10 million?

Slide 12. So the extra $10 million comes in in new products and investments.

Right. And we've already mentioned...

And there could be some in market optimization as well, right.

Right. And then Paul if you remember the last call, and I think you we mentioned here in this call that OptiSilk alone, we say is worth $5 million in 2018. So that's part of that that extra $10 million that you're asking about?

Okay. And then just lastly, you guided flat for lumber. And we've seen prices up, is that just your cautious nature?

Yes. We're watching and listening to it. Everybody else is saying the market when it comes to the analyst and a lot of them say, hey, look at some point here, we're going to see a little bit of retraction is, as BC Wood starts flowing and they get out of their constraints of transportation and should bring things back down a bit. So again, we're calling it flat, it could be up. We're already up from the first quarter into this quarter, but we do expect some kind of retreat back in the back half of the year.

Okay. That's fair enough. Thanks very much guys.

Okay. Thanks, Paul.

Thank you.

Our next question is from John Babcock with Bank of America. Please proceed.

Hey. Good morning. Just wanted to ask about the integration and kind of the progress you're seeing there. I was wondering if you could kind of talk about what's going well and what maybe could have been done better during the quarter. And obviously I realize you had the production issues. If you could provide any details on that as well that would be helpful?

So, John, I'll turn it over. Frank's leading the effort for the team and I'll turn it over to him if he wants to make some comments.

Yeah, so in regards to integration, things have gone well as planned. We haven't seen – as I said on the last call, we still haven't seen any negative surprises on the integration front. We're on target to hit our integration synergy objectives for this year. We're in the process of bringing together the 2019 and 2020 plants to hit the total $75 million, but we feel very good about those numbers that we've put out there based on what we've seen to-date. So, no issues whatsoever. I think culturally, the two companies have embraced the combination as well as the targets and goals we've set out for the companies. So, in general, we feel really good about the integration and how it's progressed to-date. Paul, do you want to comment on any of the disruption?

Yeah. So, again, to comment on two facilities we struggled with in the first quarter as mentioned. One was our chlorine dioxide generator in Jesup, and we ended up just actually changing our equipment there to put this issue behind us once and for all. And so, therefore, we feel very good about that. And the other one is the heat exchanger in Tartas, France. And so, again we have immediate work around on that issue and we'll be replacing the equipment as well there here in the near-term future. So, again both of them again are unfortunate and have operated very consistently well for a long time, but have come up here in the recent months and the teams have struggled with them getting them back up and going. We ended up just actually replacing out the equipment or plans to replace out equipment in the case of France in the very near period, and I'm putting these issues behind us. So, again our confidence is high, but unfortunately they cost us as noted about $8 million in the first quarter.

Okay. And then, just to clarify on the kind of EBITDA opportunity here, I mean, how much EBITDA should we think about for 2018? Is it that $50 million or because of the cost to achieve some of this, it could be a fair bit lower?

There'll be some cost to achieve. I think we've said, could be up to 1 times the synergies. From that perspective to-date, it's been roughly a $1 million of cost to achieve synergies so far. So, it's been a fraction of what we've saved. Our synergies, our $7 million split roughly evenly between new synergies and legacy transformation. So, we've been running below that, but there will be some costs as we move forward to achieve. So I think modeling something close to one times over the entire program is fair.

I got it. And then last question before I turn it over, just on the pulp markets, if you could talk about what you're seeing there, inventory levels and just general supply demand and also what's kind of driving your expectations around that for the rest of the year?

So, John, sorry, is your reference to the High Purity?

Yeah. No, actually the commodity pulp, the high-yield pulp.

Yeah, look, obviously we've been pleased with where those markets were at year-to-date. They're holding up very nicely. Most analysts (00:24:25) that they're going to ease-off in the back-half of the year. So we continue to believe that that will be the case as well. But having said that, we've got, again, really a strong order book. We say in the near term, it's going to hold where they are now and we still anticipate though there'll be some easing off in the back half of the year. Beyond that, mostly analysts again from 2019 through 2021 keep that commodity high-yield up there at elevated levels – of elevated pricing level. So we're optimistic on what that business can bring to us in the near term.

Okay. Thank you.

Sure.

Our next question is from Chip Dillon with Vertical Research. Please proceed.

Yes, good morning. Thanks for the details. Had a just a real quick housekeeping question. We add-up the volumes and the prices on, like, slide 5 for example that deals with specialty cellulose, we're were coming up quite short, like we have on that slide if you just add the two grades and you add (00:25:32), you are getting $251 million and yet you're showing $282 million. And I just didn't know why there would be such a gap there?

So we also have lignin and chemical sales in that segment.

Okay. That's very helpful. And the only other one where I saw, I guess in the Pulp segment, it looks like if you did the same thing, you will get closer to $78 million versus $85 million. Was there anything else in there we should be aware of?

Yeah. What you've got in there are some intercompany sales to our other business.

Oh! I got you. So these prices and sales volumes are to third parties?

Yes, that is correct.

Okay. Okay, that's helpful. And then one other just thing to cleanup is, you mentioned the pulp integration in the paperboard, you're buying a lot of the high, I'm sorry, the high-yield pulp that you produce. How much do you sell and how much do you buy annually?

We buy approximately 60,000 tons of our internal pulp and then we purchase externally and that's in that Témiscaming mill. And then we purchase in Témiscaming roughly another 2 times that. So 120,000 tons within the Témiscaming mill. Matane is all externally sourced.

Okay. And so the way you think about as a companywide is that, it looks like that you're actually buying 120,000 tons on the outside. And how much are you selling to third parties of pulp?

Of pulp, roughly 510,000 tons.

Got it. Got it, and that's really helpful.

Yeah, we make about 570,000 tons and we consume about 60,000 tons.

All right. And so the way to think about it is, you're selling on the open market somewhere around 390,000 tons and you're – oh!, I'm sorry, you're selling around 510,000 tons, you're consuming 60,000 tons, and then about a 120,000 tons of that 510,000 tons is offset by purchases. So, your net exposure is around 390,000 tons. So, that makes sense. And then...

Yeah.

And ...

...high yield market.

Yeah

Yeah. Yeah. Got you on that. And I also wanted to know, I know you mentioned the lumber duties went up, we're going to be about $30 million this year. And I think last call it was $25 million, is that just to reflect the higher prices?

Yeah.

And then, also – so that's all that is here. Okay. That's very helpful. And then, when we look at the volumes for specialties, I think last call you said it would be more flattish. Now you're saying flat to down, was there anything that changed, is there certain sub-area of specialties that changed?

I think the biggest issue was two things, one, the production disruptions, and two, just some timing sales patterns that we're seeing. But I think overall nothing material. So that will be down slightly. But again when we're not producing what we intended in the first quarter, it's hard to sell that.

Okay. And then, just real quickly the $3 million in other operating income, it was a benefit. What was that from? Which is other operating income expense net?

You know what, Chip, I may have to circle back on that to you. So, we'll try to (00:29:11).

All right. We'll catch up on that later. Okay. Thank you very much.

Thank you.

Thank you.

Our next question is from Roger Spitz with Bank of America. Please proceed.

Thank you and good morning. I think you mentioned that in Q2 2018 there'll be turnarounds of Jesup, Tartas and Témiscaming, if I heard it correctly. What would be the EBITDA impact of those turnarounds in Q2?

Yeah. It should be relatively modest. I mean, we see some of it every year. We've never disclosed exactly how much it is in any given quarter. But we'll see that going forward. Again, the best I can direct you to is when you want to think about our earnings for the year, think about roughly 45% of our EBITDA in the first-half and roughly 55% in the second-half and that'll give you a sense and that's inclusive of those turnarounds.

Got it. And within Paper, I don't know if you'll be willing to do this. I was curious if you could give some sense of the sort of sales and perhaps even between paperboard and newsprint?

Hey, Roger, we don't have it broken down that way at this point in time. So we do give you actual sales prices and volumes within that. But, we don't have the EBITDA broken or split out between the two, but you can see on page 8 you have volumes and price.

Okay. And for Q4 2017 just because you've started break it out differently here, you gave Pulp and Paper sales of $65.4 million and EBITDA of $8.1 million. If you disclose the sales number, but I was wondering what is the split of that, between the Pulp and Paper in Q4 2017 if you happen to have it hand?

I don't have that at hand.

Okay. And lastly, do you have the cumulative cash you've paid on lumber duties, you've paid and is there – depending on how negotiations go, any chance of getting that back?

Well, it's $7 million for the first quarter. So that's where we're coming up with roughly the $30 million for the year, because pricing is escalated through the quarter. In regards to getting it back, all we can say is that historically over the last two disputes, when an agreement was reached, the negotiation and settlements included a return of those duties that were paid. I believe, two settlements ago, it was a 100%. The last settlement, it was roughly 80%. So we would anticipate or would hope that we will get some back. But those disputes have taken you know three to five years to come to fruition. So right now, we're just running the business. Profitability is very good, given the price increases even with the duties. So we feel relatively comfortable in our position. And if we got the money back, that would obviously be a positive benefit at the end of the negotiations.

Thank you very much.

Our next question is from Steve Chercover with D.A. Davidson. Please proceed. Steven Pierre Chercover - D.A. Davidson & Co.: Thank you and good morning everyone.

Good morning, Steve. Steven Pierre Chercover - D.A. Davidson & Co.: So the first question, given the operational issues at Jesup and Tartas, were you able to pull any of your maintenance forward into Q1?

So we had to keep with our standard longer shutdown timing as it was originally planned, because it's really hard to move those type of larger events around, Steve. But of course any time we go down somewhat unexpectedly, we take advantage of the time in every way possible. So we move up smaller half0day, one-day projects that we had on the calendar and try to put those into that event, so that we can avoid them later on in the year. But they're on the fringe, on the margin and nothing substantial like you're hopeful that you can pull the whole shut down forward, and the answer is no. Steven Pierre Chercover - D.A. Davidson & Co.: So, despite the fact that the bulk of the maintenance at the specialty mills occurs this quarter, we should still think of the EBITDA, I guess, being up in the vicinity of $15 million at minimum, because of the non-recurring?

That's probably a fair way to look at it and then back off a little bit from some of the shutdown issues. But it's not – they're not huge dollars. Steven Pierre Chercover - D.A. Davidson & Co.: Great. Okay, and then in specialty cellulose, was your pricing hit by mix it all or is the $13.75 that you realized in Q1 a decent run rate for the year?

I would say that the mix did impact it. Two things impacted it. Obviously in the first quarter every year we have a little bit of volume that ships in 2017 or the year prior and then hits as revenue in 2018. So that tends to come through at last year's prices. And then there was a little bit of mix associated with it as well. So, we would anticipate for the year we would be down 4% to 5% as we said before from last year. Steven Pierre Chercover - D.A. Davidson & Co.: From the full-year average of the last year.

Correct. Steven Pierre Chercover - D.A. Davidson & Co.: Okay. And then can you help us think about how the seasonality impacts your northern mills, newsprint, paperboard, BCTMP? Very minimum, I would think the energy use comes way down.

Yeah, I would say, Steve, just from a market standpoint, you don't see a lot of seasonality outside of lumber of course. You've got a building season that that tends to take product obviously more readily in the warmer months. The biggest impact that you see and we noted it, Frank commented on that, is just on working capital, right. So, if there's a seasonality impact, I'd say that's the main area. And then outside of that, certainly then the lumber flowing in the warmer construction months, obviously, more readily than not.

Yeah, Steve, we have seen over the last year or two though – and you're right, typically energy would be lower in the winter because of the heating season in Toronto during the summer. But we've also seen with some of these extreme cold, pulling some very higher energy costs in the first quarter. So, it's not as clear that it's lower or higher from that perspective. The energy really depends on extremes more than it does general temperature patterns. Steven Pierre Chercover - D.A. Davidson & Co.: Yeah. Well, I'm surprised speaking of energy that there was such a spike down in the south, I mean is it coming to you via pipeline or via some other transportation mechanism?

Yeah. So, it comes via pipeline and the entire south got hit with extremely cold weather as you might know in the month of January – late December and for the first half or most of the month of January, which caused the prices to increase materially in the Georgia region and along some of the southeast coast.

Again, and Steve, it wasn't the molecule itself, it was truly distribution cost and getting it to us.

So demand went way up for the molecules moving through those lines.

You probably heard others report on the same here on this – with regard to their operations in the southeast. Steven Pierre Chercover - D.A. Davidson & Co.: So, I guess that's what I'm trying to understand. So, it's the distribution. It's not the cost per BTU or however they measured. It's the cost of getting the molecule to the facility?

Think about it as the local cost of that energy. This is I think the easiest way to say it. There is a supply demand issue in that localized region which then drives up the price. Steven Pierre Chercover - D.A. Davidson & Co.: Okay. And then, a number of my questions have been answered, but with respect to the lumber file, we certainly hope you get those duties back and the precedents are in your favor. Is there any update you can provide with respect to negotiations between Canada and the States?

I have no updates, Steve, and I quite honestly, I think there has been very little activity as I know both governments are working on other issues and mainly NAFTA. Steven Pierre Chercover - D.A. Davidson & Co.: Okay. And just to reaffirm, you're being fairly conservative in terms of both your BCTMP and your lumber pricing to kind of call them flat for Q2, even though we appreciate you not being promotional, you're probably not going to stay at current levels, but the Q2 average so far is higher than the Q1?

Yeah. That's correct, Steve. And it moved up. I think lumber moved up again last week in some of the industries, as well as we've seen that little moderation in the pulp side, but kind of flat. Steven Pierre Chercover - D.A. Davidson & Co.: Okay. Thank you, all.

Thanks, Steve.

Our next question is from Dan Jacome with Sidotti & Company. Please proceed. Daniel Jacome - Sidoti & Company, LLC: Yeah. Hi. Good morning. Just a couple of questions. So, first on the operational equipment issues, I think you mentioned the chlorine and the sulfur. So, I'm not too surprised by the natural gas price elevation, a couple of my companies have mentioned that. But just on the equipment, I mean, I'm trying to understand if anything from that was related to the Tembec integration, which I guess I'm trying to ask, would these equipment issues have happened if Tembec did not exist and you do not acquire those operations?

Yeah. Completely independent. And nothing to do with that. Daniel Jacome - Sidoti & Company, LLC: Okay.

The heat exchanger in the sulphur burner in the Tartas, France facility has operated incredibly well for decades. So why we had a failure at one point of time we don't know, but we wrestled with it for a while and then made a decision to go ahead and just replace the exchanger in total and put a brand new one in it, and very similarly this chlorine dioxide generator in Jesup, but nothing to do with the acquisition or integration. Daniel Jacome - Sidoti & Company, LLC: Okay. So, I mean, that is encouraging definitely, but – and you had no visibility into these two issues when you last talked to us in February?

Some of these – we mentioned that we had some challenges in the fourth quarter of 2017. Daniel Jacome - Sidoti & Company, LLC: Okay,

So some of that was related to these and again... Daniel Jacome - Sidoti & Company, LLC: Okay,

...since that time we've made the decision to go ahead and actually replace them out. Daniel Jacome - Sidoti & Company, LLC: Okay, fair enough. And then lastly on the debt reduction plans, I think you mentioned 2.5 times leverage ratio goal over time. And if I got you correctly, can you refine that a little bit further if possible and then if you cannot – maybe you could supply us with this answer, what in a best case scenario would be the time it would take to maybe get to pre-Tembec leverage, if possible? Thank you.

Okay. So pre-Tembec leverage was closer to 2 times. So I don't think we'd go down to that level at this point. So I think we're more around the 2.5 times focused. The leverage will be driven by three things. One is going to be reduction of debt and to-date we've basically paid back minimum amount of debt actually what was due. Two is high0return projects would drive carrier EBITDA because if we can raise the EBITDA up, obviously, we will drive our leverage down as well. So, between the combination of those two items and the strength of our overall markets, we'd anticipate driving that leverage down to 2.5 times relatively quickly. Daniel Jacome - Sidoti & Company, LLC: Okay.

But we haven't given a specific timeframe out on that. So again, we've got a couple of programs out there, (00:41:42) one in Québec where it is very advantageous from a return perspective to make those investments quickly and we intend to do that. Those should benefit us from EBITDA. We'll also pay down some debt. And as I said, we're very focused on having a balanced capital allocation program. So to the extent that it makes sense for us to repurchase some shares, we'll also look at that over time. We'd expect that to be a little bit later, but we will be very opportunistic if we see opportunities to go in the market and buyback stock. Daniel Jacome - Sidoti & Company, LLC: Okay. Great. Thank you. Good luck for the rest of the quarter.

Thanks, Dan.

We have a follow-up question from Paul Quinn with RBC Capital Markets. Please proceed.

Yeah. Thanks for let me circle back here. Just three easy clarifications. One, the 60,000 tons at Témiscaming that transferred internally, is that a market price or cost?

We view it at market price. We set that quarterly. So we try to set that on a market price basis.

Yeah. Frank, I don't know ...

Is that quarterly terms or is it?

Yeah. I don't know if it's quarterly, maybe an annual.

May be annual.

It's set at market the time at budget and we leave it there and we adjust it later. Daniel Jacome - Sidoti & Company, LLC: Okay. And then I understand the $7 million in lumber deposits in Q1, would it come back to positive in 2017? I suspect it's somewhere around $15 million. And are you eligible for that if the deposits are returned?

Yes. The number is $11 million, I don't know if you heard that.

Yes. Daniel Jacome - Sidoti & Company, LLC: $11 million. Okay. And you generated pretty decent cash flow in the quarter. It looks like a lot of it was hidden behind the working capital build. I got that at $32 million, is that right?

Working capital just on the lumber alone was $32 million. That tends to go up a lot in the first quarter as they need to basically harvest most of the lumber in Northern Canada, while the ground is frozen, so they can get transportation in and out of the forest. So, it's a little bit higher than that. It's a little bit higher than that. But that $30 million to $35 million is probably the good basis. Daniel Jacome - Sidoti & Company, LLC: Okay. And then how do you, the liquidation of that net working capital build, how do you see that coming out over the next couple of quarters?

I'd say it would liquidate in the next two quarters roughly on the lumber side. Daniel Jacome - Sidoti & Company, LLC: Excellent. That's all I had. Good luck.

Thanks, Paul.

We have a follow-up question from John Babcock with Bank of America. Please proceed.

hey, just hopefully a couple of easy ones here. Just back to that EBITDA comment earlier, adding back the one-time items I guess, would be around kind of $50 million. And then you mentioned that there would be some shutdown issues that might mitigate that were not issues, I guess, but essentially like on the downtime you have. Is there anything else that we should be taking into account as we're kind of modeling out from 1Q to 2Q?

I think that will give you a rough estimate. Again, we don't give quarterly estimates, so quarterly guidance for the business, but I think on the High Purity side, that's a reasonable way to think about it.

Okay. And then High Purity Cellulose segment, I was just wondering if you could talk about (00:45:17) demand there? I mean, we're hearing just generally at times that particularly cigarette demand seems to be weakening and wondering how that impacts you I guess quarter-to-quarter, but then also how you're thinking about it on an annual basis now?

Yeah, I don't think our perspective has changed since we talked about this at our February call, which again we said, look globally, we anticipate that it's flat to down where China would be a little bit higher than the balance of the rest of the world. So, for the rest of the world would be 2% to 3% down and some range with China flat and maybe even up a little bit. So, I don't think that perspective has changed at all, John. And listening to some of the others, kind of like customer side present, it sounds like they're calling it flat for the year year-over-year as well in terms of their demand. So, I don't think it's inconsistent from what we hear them seeing, so – or what they're seeing. So, that's kind of where we are now. And I don't think anything has changed. If we get more information, new information, we'll be sure to share it with you.

Okay. Sounds good. Thanks. That's all I had.

Sure.

We also have a follow-up question from Chip Dillon with Vertical Research. Please proceed.

Yes, hi. Just a quick one. You mentioned I know some downtime maintenance, downtime I believe for the rest of the year. And I think you mentioned it was mostly in the second quarter at least for the big mills. Could you just clarify that just so we can get a better feel for how that's going to impact you throughout the year?

So, we take down in the second quarter Jesup, Tartas and Témiscaming. So, those three mills come down. Fernandina was in the first quarter.

Yeah. That's right. And then a positive note on that, Jesup is just coming out of there now and it's coming up real well. So, that's great maybe even slightly better than planned. So I think that's good. And then going forward, Chip, we will look at – and this is how kind of a legacy company is headed on the schedule. We're going to relook at that and see if we can balance those out a little bit, so that you don't have all four in the first half or three in this case in one single quarter. We're about to kind of space some out a little bit just from our resource allocation standpoint, in terms of people and capital. So, but that's really we felt this year.

And would you expect the lack of the two issues, the $15 million, the weather, the nat gas distribution issue, would the impact of that not happening in the second quarter, would that benefit of not having to repeat that offset the higher maintenance of having three mills out or will it be another which will be a washer or I mean you've mentioned you expect income to gradually rise. So how should we think about that $15 million and the incremental impact of having three versus one mill down in the second quarter?

We would anticipate that a meaningful portion of that $15 million should fall to the bottom line. It will be offset modestly by some of these shutdowns et cetera, but it's going to be – it should be nowhere near that $15 million, it'd be a fraction of it.

Okay. All right, helpful. Thank you.

Ladies and gentlemen, we have reached the end of our question-and-answer session. I would like to turn the call back over to Paul for closing remarks.

Okay, well thanks everybody for your time this morning. If there is no more questions, we'll go ahead and wrap it up. And look, we're very excited about the opportunities in front of us and we look forward to delivering on our goals and we look forward to providing you with updates in a timely manner as we move forward. So we'll talk to you next time through and again. Thanks for your time this morning.

Thank you. This concludes today's conference. You may disconnect your lines at this time and thank you for your participation.