Mativ sales fall nearly 3% as tornado offsets advanced-materials growth

By Grace Kim

Mativ Inc. (NYSE: MATV) reported third-quarter 2026 net sales of $500 million, down nearly 3% from a year earlier, while organic sales fell more than 2%. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) dropped 7% to $62 million, and adjusted EBITDA margin narrowed 50 basis points, or half a percentage point, to 12.5%.

Chief Financial Officer Scott Minder said a July tornado cut sales by $20 million to $25 million, matching previous expectations. Management said adjusted EBITDA would have grown year over year without the storm. Mativ still expects organic volume growth in both segments in the fourth quarter, although tariffs and storm-related costs should constrain earnings.

What powered advanced-materials growth?

Filtration & Advanced Materials (FAM) generated $219 million in net sales, up more than 10% on a reported basis and more than 11% organically. Adjusted EBITDA rose 20% to $40 million, while segment margin expanded 150 basis points to 18.1%.

President and Chief Executive Officer Shruti Singhal said films led growth, followed by industrial and aftermarket transportation filtration. Specialty films serving commercial space climbed more than 30% year over year. Materials supplied to a commercial space launch provider “moved from customer qualification to commercial use” during the quarter and now enter standard production runs.

Mativ expects that business to scale in 2027 as the customer increases launch frequency. Minder said commercial space films, aftermarket automotive filtration and automotive films outgrew the rest of FAM. He expects those drivers to continue in the fourth quarter, though pricing gains relative to input costs should taper as costs catch up.

Takeaway: Advanced materials offset part of the storm damage, but their pricing cushion is set to shrink.

How badly did the tornado disrupt SAS?

Sustainable & Adhesive Solutions (SAS) posted sales of $281 million, down more than 10%, and adjusted EBITDA of $33 million, down 25%. Minder attributed the sales fall mainly to the tornado, healthcare customer inventory destocking and Canadian tariffs affecting some tape exports to the U.S.

The tornado struck Mativ's primary third-party distribution center in Menasha, Wisconsin, destroying most paper and packaging inventory. Mativ shifted distribution to three interim warehouses, adding transportation and handling costs. “Shipments resumed within 72 hours,” Singhal said, and Mativ did not lose any customers.

Minder said the storm caused more than half of SAS's year-over-year adjusted EBITDA decline through lost contribution and additional logistics costs. Mativ expects to recover most lost sales over the next couple of quarters, including the fourth quarter, and expects full insurance reimbursement for damaged inventory.

Mativ is also pursuing a business interruption claim for other storm-related costs. Distribution inefficiencies should remain a near-term expense while Mativ works toward a permanent solution.

Takeaway: The sales recovery is expected to arrive before the extra logistics costs disappear.

Can volume growth offset tariffs and costs?

Singhal said a 50% tariff applies to finished cable and construction tapes exported from Mativ's Renfrew, Ontario, facility to the U.S. The exposure equals about 2% of consolidated annual revenue. Mativ is working with customers and suppliers to limit the effect and has identified alternative sourcing and price increases as possible longer-term measures.

For the fourth quarter, executives expect year-over-year organic volume growth in both segments, supported by advanced films, filtration and recovering paper and packaging sales. Healthcare destocking should continue through year-end, with ordering patterns expected to normalize in early 2027.

Despite the volume recovery, Minder forecast a low-single-digit percentage decline in fourth-quarter adjusted EBITDA from a year earlier. He cited tariffs, continuing distribution inefficiencies and an unfavorable mix from healthcare destocking. Still, Mativ expects full-year revenue, earnings and cash generation to exceed 2025 levels.

Takeaway: Fourth-quarter volume can improve before earnings do, because three cost and mix pressures remain.

What does the balance sheet show?

For the first nine months of 2026, adjusted EBITDA rose 8% to $185 million and free cash flow, cash generated after capital spending, increased 5% to $90 million. Third-quarter free cash flow was $38 million, down $29 million from a year earlier.

Net debt stood at $879 million at quarter-end, down 6% year over year, while net leverage under Mativ's credit agreement stood at 3.8 times. Minder expects leverage to reach the upper end of its 2.5-to-3.5-times target range by mid-2027.

Mativ sold its previously closed Appleton, Wisconsin, facility for about $7 million in early November; the sale will appear in fourth-quarter results.

Takeaway: Debt is moving in the right direction, but the mid-2027 target still requires further reduction.

What does Mativ make?

Mativ is a global manufacturer of specialty materials and engineered solutions used in filtration, healthcare, hygiene, food and beverage, industrial, packaging and other specialized applications.

Its products include:

• filtration media and components;
• engineered papers and nonwoven materials;
• release liners;
• protective and medical materials; and
• other performance-oriented substrates.

Those substrates provide filtration, barrier protection, absorbency, strength and durability in consumer and industrial products. Mativ formed in 2022 through the merger of Schweitzer-Mauduit International and Neenah, combining their specialty-materials businesses.

Takeaway: The broad portfolio now hinges on advanced films, storm recovery and cost control.