Prepared remarks
Thank you for joining Packaging Corporation of America's Second Quarter 2026 Earnings Results Conference Call. Your host today will be Mark W. Kowlzan, Chairman and Chief Executive Officer of PCA. Upon conclusion of his narrative, there will be a Q&A session. I would now like to turn the floor over to Mr. Kowlzan. Please proceed when you are ready.
Thanks, Jamie, and good morning, everyone, and thank you all for participating in Packaging Corporation of America's second quarter 2026 Earnings Release Conference Call. Again, I am Mark W. Kowlzan, Chairman and CEO of Packaging Corporation of America. And with me on the call today is Tom Hassfurther, President, and Kent A. Pflederer, our Chief Financial Officer. I will begin the call as usual with an overview of our second quarter results and then I will be turning the call over to Tom and Kent who will provide further details. I will then wrap things up, and then we will be glad to take questions. Yesterday, we reported second quarter net income of $192 million or $2.15 per share. Excluding special items, the second quarter 2026 net income was $210 million or $2.35 per share compared to the second quarter of 2025's net income of $224 million or $2.48 per share. Second quarter net sales were $2.5 billion in 2026 and $2.2 billion in 2025.
Total company EBITDA for the second quarter, excluding special items, was $486 million in 2026 and $451 million in 2025. Second quarter net income included special items expense of $0.20 per share, primarily for costs and write-offs related to facilities closures, Wallula Mill restructuring charges and costs related to the acquisition and integration of the Greif containerboard business. Details of the special items for the second quarter of 2026 and 2025 were included in the schedules that accompanied the press release. Excluding the special items, our earnings decreased by $0.13 per share compared to the second quarter of 2025 resulting from a $0.27 decrease in legacy business earnings, partially offset by $0.14 of earnings from the acquired Greif business. The decrease in the legacy earnings was driven primarily by higher freight costs of $0.26, higher corporate and other expenses $0.12, lower price and mix in the packaging business $0.11, higher labor and operating costs $0.05, higher depreciation and amortization expenses $0.03, higher fiber costs $0.02, higher tax rates $0.02, and higher interest expense excluding the Greif acquisition indebtedness for $0.01.
These items were partially offset by higher production and sales volume in the packaging business for $0.26, lower maintenance outage expense $0.04, higher production and sales volume in the paper business for $0.03, and higher price and mix in the paper business $0.02. Greif's earnings were driven by strong volumes in the corrugated business and improved operating performance in the mills and included a $0.04 benefit to depreciation expense due to measurement period adjustments to the valuation of fixed assets on the opening balance sheet of the business. We exceeded our guidance of $2.33 on the strength of our corrugated volumes, which helped drive cost favorability in areas that we could control and offset higher-than-forecast costs for freight, recycled fiber, and employee benefits. Greif's earnings contribution also exceeded our expectations. Looking at our packaging business, EBITDA excluding special items in the second quarter of 2026 of $489 million with sales of $2.3 billion resulted in a margin of 21.1% versus last year's EBITDA of $453 million and sales of $2 billion or a 22.6% margin.
We produced 1.42 million tons of containerboard during the quarter. The legacy mills produced 1.21 million tons of containerboard, about even with the first quarter of 2026, and 14 thousand tons more than the second quarter of 2025. The acquired mills produced 206 thousand tons during the quarter, significantly exceeding their production in any quarter since the acquisition. System-wide, our inventories were down 25 thousand tons from the end of the first quarter. While we ended the quarter at a low number, we have been able to build some inventory early in July with many plants down for the holiday weekend, to help get us near our target levels of inventory. With not as much outage impact in the third quarter, we will be in a much stronger position to serve our customers in the very tight conditions that we are operating under. Operational performance was a mixed bag during the quarter, as we were hit with some production interruptions resulting from utility power outages across the mill system.
This further emphasizes our need to execute and realize the benefits of the gas turbine projects, which will reduce, if not eliminate, our reliance on the grid at three key facilities. It is also a testament to the organization that we are able to work through and minimize the effects of these issues to achieve the production we achieved given that we had completed outages at five of the packaging mills during the quarter. We managed costs very well in the areas we could control, particularly in the box plant system to help offset the headwinds we faced from elevated freight and increased recycled fiber costs. I will now turn it over to Tom, who will provide further details on containerboard sales and the corrugated business in general.
Thank you, Mark. Our corrugated operations turned in yet another very strong quarter in all areas. Domestic containerboard and corrugated products prices and mix were $0.11 per share below the second quarter of 2025 and up $0.04 per share compared to the first quarter of 2026 and in line with our forecast. Corrugated prices were slightly below first quarter levels until we began to realize the first increase in June. We are seeing the majority of the first increase rolling in during July and we will see the beginning of the second increase in August with realization split between Q3 and Q4. Export containerboard prices were $0.01 above last year's second quarter and $0.02 above the first quarter of 2026. Export sales volume of containerboard was 30 thousand tons lower than the first quarter of 2026 and 22 thousand tons lower than the second quarter of 2025. We decided mid-quarter to lower export sales to build inventory so we can supply our corrugated plants to efficiently serve our customers.
As Mark alluded to earlier, we were able to meaningfully increase our inventory during the first week of July which puts us in a good supply position for the back half of the year with our mills running full out. Demand was very strong throughout the quarter across our entire customer base. Shipments were up over 24% in total and per day versus last year, with the legacy business up 4.1%, achieving an all-time record for total quarterly shipments. The acquired corrugated business had an excellent quarter driven by strong volumes in both the sheet feeder and bulk businesses which drove its earnings contribution above our expectations. We saw meaningful improvement of the integration level of containerboard produced by the acquired mills into the combined box plant system as well as from legacy PCA mills into the acquired corrugator operations. Given the volume, the box plants across the whole system had to step up and perform to satisfy our customers while costs were increasing, and they did just that.
Our corrugated operations were favorable to forecast in almost all cost areas which helped mitigate the freight hit we took during the quarter. We also optimized our production and ran the right orders in the right plants to maximize efficiency and margins. Our people demonstrated their unwavering commitment to our customers to deliver this outstanding performance. Finally, I am pleased to report that we successfully started up the new Ohio plant earlier this month ahead of schedule. The state-of-the-art 550,000-square-foot facility will further enhance our capabilities to serve and grow with our customer base in a very strategic area for us while improving our operational efficiency over the long term. I will now turn it back to Mark.
Thank you, Tom. Looking at the Paper segment, EBITDA excluding special items for the second quarter was $39 million with sales of $157 million, or a 24.9% margin compared to the second quarter of 2025's EBITDA of $30 million and sales of $146 million or a 20.8% margin. Note that the International Falls outage was in the second quarter of last year and will be in the third quarter this year. Sales volume was approximately 3% below the first quarter of 2026 and approximately 6% above the second quarter of 2025. Prices and mix were up 2% from both the first quarter of 2026 and the second quarter of 2025. So another solid quarter from the paper business with strong margins. We are continuing to implement our previously announced price increases and expect to benefit in Q3. I will now turn it over to Kent.
Thanks, Mark. Cash provided by operations was $376 million and after $206 million of CapEx, free cash flow was $170 million. In addition to CapEx, the primary payments of cash during the quarter included dividend payments of $111 million, cash tax payments of $78 million and net interest payments of $54 million. We did not repurchase shares during the quarter. Excluding special items, our effective tax rate during the second quarter was 25.7%. We expect the third quarter rate to be approximately 26%. We continue to forecast $840 million to $870 million of CapEx and, excluding special items, around $710 million of DD&A for the year. Our special items expense for the year through the end of 2Q included $56 million in depreciation expense associated primarily with the Wallula Mill restructuring. I would now like to give you an update on the annual outage schedule and earnings impact for the year. Our outage expense was $0.34 during the second quarter. Our back half estimates are now $0.30 for the third quarter, and $0.63 for the fourth quarter, totaling $1.41 for the year. As we indicated, International Falls, our only white paper mill, will have the outage in the third quarter. In the packaging segment, only the Riverville mill is scheduled for a third quarter maintenance outage. I will now turn it back over to Mark.
Thanks, Kent. Looking ahead, as we move from the second quarter into the third quarter, we expect continued strong demand in the Packaging segment and corrugated products volume to increase with one more shipping day. Prices for containerboard and corrugated products will be higher as we complete implementation of our first announced increase and begin to realize our second announced price increase. We will have one more day of mill operation as well as lower impact to production from maintenance outages. We also expect better operating performance across our containerboard mill system with continued improved capabilities from our Jackson mill as well as the acquired Greif mills. Mill maintenance outage expenses will be lower in total in the packaging segment and higher in the paper segment. We expect lower volume and higher prices in the paper segment as a result of the maintenance outage and continued implementation of our previously announced paper price increases.
Cost for freight across the business will remain at or around the elevated levels we experienced in May and June. Recycled fiber prices are continuing to increase and higher mill production will drive usage higher. We expect higher prices for chemicals and power and electricity with wood fiber and natural gas remaining relatively flat. We expect some improvement in employee benefits costs due to second quarter unfavorability that is not expected to repeat in the third quarter. Considering these items, we expect third quarter earnings of $2.91 per share, excluding special items. With that, I would be happy to take any questions, but I must remind you that some of the statements we have made on the call constituted forward-looking statements. The statements are based on current estimates, expectations and projections of the company, and do involve inherent risks and uncertainties, including the direction of the economy and those identified as risk factors in our annual report on Form 10-K on file with the SEC. Actual results could differ materially from those expressed in the forward-looking statements. And with that, Jamie, I would like to go ahead and open the call for Q&A.
Questions and answers
Thank you. And at this time, we will begin the question and answer session. You are using a speakerphone, we do ask that you please pick up the handset before pressing the numbers to ensure the best sound quality. Once again, that is *1 to ask a question. Our first question today comes from George Staphos from Bank of America Securities. Please go ahead with your question.
Hi, everyone. Good morning. Hope you are doing well. Thanks for the details. How are you? So I guess maybe to start, as always, can you give us a rundown on what you are seeing in terms of bookings and billings to start the third quarter. Anything sort of unique or notable in the trends that you are seeing? And I had a couple of follow-ons.
Hey, George. It's Tom. Billings are up 1.5% so far, and we are expecting for the quarter, this is in the legacy business, to be up about 2%. That is pretty much in line with what we thought. And, of course, it is against a pretty tough comp. As you may know, Prime Days were moved up a quarter, so it is going to change the numbers a little bit in the third quarter, but all in all, we are happy with that growth, and we are being pretty disciplined and selective in terms of our growth as well.
Okay. Thanks for that, Tom. Within the 2Q volume to 3Q volume comparison, and you mentioned one consideration is there anything else that could decelerate, or is that the only thing that, from what you can see, is worth noting? And relatedly, this is neither here nor there, it is our model, not yours, but mix was a little bit less than we are expecting in terms of revenue per ton. Was that related to any sort of customer factors or anything else in the mix? And then my last question, bigger picture, Mark, for years the company has talked rightly about its fiber flexibility, frankly the weighting more towards virgin versus recycled, which gave you a little bit more predictability on your costs. How do you see that evolving now that you become maybe almost as much recycled as virgin relative to the prior setup? Thanks, guys, and good luck in the quarter.
Let me start that question up first, George. We are probably currently around 30% recycled to 70% virgin on any given day. It flexes up and down to 35% at times. As we are pushing the system now, we are probably up closer to the 35% level. But, nevertheless, we have gone through an unusual time since the beginning of the year. OCC and recycled fiber are up about 70%, and that impact is felt directly. So we are maximizing the virgin kraft system and taking advantage of the OCC systems to fiber up the mills. That is pretty much where we are and where we expect to be. We are not planning on any big capital expenditures right now for either fiber.
George, you know, relative to mix, 2Q going into 3Q, as I mentioned, the Prime Days in e-commerce was very strong in the quarter, and they moved that up. Somewhat, so that really impacted the general mix, which translated into price as well. And then, of course, we had the $20 reduction that was announced in RISI, which impacted price as well. But the good news is all segments of the business were very strong, and we are up. We plan to see that going forward as well. And the 3Q price is obviously going to change dramatically as we roll through the price increase that I mentioned in my commentary.
Okay. Thank you very much. I will turn it over.
Thanks, George. Next question, please. Our next question comes from Mike Roxland from Truist. Please go ahead with your question.
Yeah. Thank you, Mark, Tom, Kent, for taking my questions. You mentioned Greif beat by $0.10. I think you were expecting maybe a $0.04 contribution and you ended up with $0.14. So when you think about the beat, it seems relative to the street for the quarter, it seems like most of it came from Greif rather than your legacy business. Any color on the miss in your legacy business relative to expectations? Is that largely due to cost, mainly freight? Any color on the puts and takes in the quarter relative to between legacy and the Greif assets?
So, Mike, I will start with this. It is Kent, and then Tom will add some color. Greif was a $0.14 earnings contribution that exceeded expectations, the headline number by call it $0.09 or $0.10. $0.04 of that was the depreciation benefit that we called out in the earnings release. So if you are looking apples to apples, $0.05 to $0.05 cents from expectations. That was driven by largely higher volumes than we expected and very good operational performance. Also, we are running Greif now as a much more integrated system. It is much less separate from PCA legacy than when we made the acquisition, obviously by design. So there are some puts and takes. We are moving business between, trying to get efficiencies maximized, and Tom can comment on this a little bit further.
There is really not a ton to add. We are running the business to the greatest efficiency we can, and we are trying to utilize all of our assets in the best possible way. We now view this business as being totally integrated and we are operating as one unit.
Got it. You had a transition services agreement with Greif that may expire. Is there any way to quantify what you get back from the expiration of that agreement?
I will let Kent handle that.
So the transition services agreement runs through the end of the year as we bring the last few corrugated plants and one facet of the mills onto the PCA system. We have three more plants coming up in Q3 and the last couple coming up in Q4. The TSA costs are reported as part of acquisition integration charges. But the efficiencies we are seeing are really from having better visibility to the business and taking advantage of optimizing the supply position between PCA mills on one hand and the Greif facilities on the other hand. That really is where it is coming from, Mike.
I will add that we look forward to having them all on our system.
Got it. That sounds like it will be done by year end with the TSA. Perfect. One last one, I will turn it over. Just in terms of tariffs, there are 50% tariffs potentially being proposed to be applied to Canadian imports of containerboard, maybe boxes. Any thoughts around those tariffs and what it means for the domestic industry?
Right now, our initial read is little to no impact; it is not 100% clear at this point in terms of what it really applies to. So we will take a wait-and-see approach. But right now, we do not view it as a significant driver either way.
Thank you. Our next question comes from Mark Weintraub from Seaport Research Partners. Go ahead with your question.
Thank you. So you mentioned that you started to see the market increase in June. Can you give us a sense as to how much of the $50 would have shown up in your box prices in the second quarter, presumably the balance of that would be in the third quarter? And then you used the term you expect to split the June increase between Q3 and Q4. Is that evenly, or was that just some of it is going to show up in Q3 and some in Q4? To the extent you are comfortable quantifying rough percentages, that would be helpful.
Hey, Mark. I will start, and then Tom will finish. On the first increase, the vast majority of that is coming in Q3. Calibrate it maybe 70% to 75% of it is Q3 in July. The second increase, the majority will come in Q4, but not quite as pronounced as the Q3/Q4 split on the first increase.
That is exactly the way we see it. Also remember that we were impacted by the $20 down that trailed into Q2 and the mix had some impact. All of that then comes back in Q3 and Q4 with these increases as they roll through, as Kent mentioned.
Right. And then just as a follow-up: in some environments in the past you have been able to get more than full pass-through. Given the high cost environment right now, are we in that type of an environment? How should we think about the ability to get full or possibly even more than full pass-through?
Mark, I am not going to quantify that for you, but I can tell you that earning your cost of capital is our mission. We always try to pass through costs appropriately and we are having a lot of discussions around that. We are in a very inflationary environment and we are working to address it.
Thank you. Next question, please. Our next question comes from Gabe Hajde from Wells Fargo Securities. Please go ahead with your question.
Mark, Kent, Tom. Good morning. You talked about being able to build a little bit of inventory early in the quarter around the July 4 holiday. Tom, I think you also mentioned 1.5% billings. I know we cannot extrapolate that out, but I think you referenced maybe 1.5% to 2% for the quarter on a year-over-year basis. If I got my comparisons correctly, I think shipments were down 1.1% in Q3 2025. So just assuming I have that level set, how would you describe the feel in the market right now from a supply-demand standpoint? You guys delayed some sales of exports into the third quarter to shore up inventories and there have been some supply disruptions in the market. Do you have customers coming to you asking for help, anything like that?
I am going to give you one word, Gabe, to describe the environment: tight.
Okay. Got it. We heard some comments about maintenance outages and some folks coming out a little bit slower than expected. Did you experience any of that, or was it related to the grid volatility you mentioned in your prepared remarks?
We went through annual outages at five of the mills during the second quarter, and we executed incredibly well and in most cases ahead of schedule and restarted the mills successfully. But we had at least five distinct utility power outage situations at a number of the mills. For example, one mill was shut down for the better part of a full day due to their own hardware issues and had continuing problems for a few more days getting their grid stabilized. Another location had the utility shut down the entire regional system without notifying anybody because of forest fire season. It took down the mill instantaneously out in Wallula and impacted us for a period of time. We are having situations with voltage droops and surges through the systems. It speaks in many cases to what is happening with the nationwide integrity of the grid. We overcame those issues, and it speaks to the ability of our people to rally and stabilize the mills, but it also speaks to the importance of the three gas turbine projects we are bringing online over the next two years and how critical they are going to be to those mills.
Thank you. Quick math question: you said 70% realization, Kent, on the second price increase in terms of split Q3/Q4, $35 a ton, maybe 1.4 million tons. Directionally $4 to $4.55 billion benefit we are thinking about on a sequential basis. Maintenance costs are up, I think, 33 cents directionally. So maybe $40 million offset. And then there is one less shipping day. Is there anything else we should be thinking about, like higher energy consumption for colder weather conditions in Q4? Anything else to be mindful of for Q4?
For Q4, maintenance is primarily higher and there is a normal seasonal mix. A little bit higher depreciation run rate as I mentioned in my prepared remarks. Seasonally strong volumes are expected. Those are the primary factors. Trying to put a crystal ball around freight and energy base costs is premature at this point.
Absolutely. Good luck. Thanks.
Next question, please. Our next question comes from Anojja Shah from UBS. Please go ahead with your question.
Hi. Good morning, everyone. Sorry if I missed it, but did you give a sense of what you expect from the Greif assets in the third quarter in your guidance?
Yeah. The way I would look at it, Anojja, you will have the benefits of continued strong volume, consistent with or even a little above second quarter levels. You will have the benefits of price coming in, but that will probably be offset by the fact that you have Riverville down in the third quarter, so you will have outage expenses. So the way I am looking at it from an earnings contribution, and again I am taking this against a $0.10 contribution without the depreciation benefit we got in February, you are probably going to be a penny or two down versus February in terms of the Greif contribution. And again, 3Q will be the last time we call Greif out as an individual contributor; it is really part of PCA from this point on.
Okay. Great. And any update on the Greif synergies? I think we had about $30 million penciled in for this year, and now we are at the halfway point. Can you give us an update there?
Between the mill production improvements we called out last quarter, we are on track or even a little bit ahead of that. We are running in the 5% to 10% improved reliability range, which we are seeing in better production. The integration benefits are starting to come into the numbers as well. From an integration standpoint, we are on track probably to exceed a $30 million run rate by the end of the year. So very comfortable with where we are at there, Anojja.
Okay. Great. Thanks very much. I will turn it over.
Thanks, Anojja. Next question, please. Our next question comes from Anthony Pettinari from Citi. Please go ahead with your question.
Hi. Good morning. The second quarter corrugated demand was a bit stronger than we expected. Do you think there is any element of prebuy there with two price hikes in the market? Also, did the World Cup have any impact?
Anthony, this is Tom. The second quarter demand was very strong. Some of the e-commerce activity around Prime Day certainly drove business in the quarter. Our capacity is so tight that it's impossible to get a meaningful prebuy in right now, so that wasn't a primary factor. The World Cup had very little impact in my opinion.
Okay. Switching gears, Mark, you referenced the three energy projects over the next couple of years. Any timing you could put on the cadence for those, and then the CapEx guide of $840 million to $870 million you reiterated—any directional view for 2027 CapEx?
Regarding the three gas turbines, we are in construction at the Jackson Mill as we speak. We are waiting on some deliveries of switchgear components that will be needed to tie in and utilize the gas turbine into the existing system at the mill. The goal is to have that gas turbine at Jackson online next year in coordination with Jackson's annual outage in the latter part of the year. For Riverville, Virginia and DeRidder, Louisiana, we are going through environmental permitting. It is taking longer to get state and federal permits than the construction itself. I expect the DeRidder and Riverville units to be more like the first half to mid-2028 to get those two units up and running based on the timing for permits from the states.
Got it. Any directional views on CapEx in 2027 versus 2026?
We are just starting that discussion. The gas turbine projects will consume a good portion and we always have good opportunities on the converting side and the mill side. I would assume CapEx will stay in this general range, but we will continue to evaluate high-return opportunities. We want to remain disciplined and execute well.
I would add that this is a very capital-intensive business and cost of capital keeps going up, so it's incumbent on us to make sure we hit our hurdle rates and reinvest in the business where appropriate. We are feeling the pinch of higher costs and tight box plant capacity, so disciplined reinvestment is critical.
Got it. That is helpful. I will turn it over.
Next question, please. Our next question comes from Philip Ng from Jefferies. Please go ahead with your question.
Hey, guys. Given how tight the market is, can you give an update on some of the capacity unlocks you were planning from Jackson and some of the Greif assets? Mark, you hinted at potentially other things you are circling in terms of unlocking more capacity on the mill side. Give more color on how that is coming along and potential opportunities going forward.
At Jackson, the new winder project is coming on later this year. We have done a number of things at Jackson and will see the incremental tons we committed to coming online. Massillon Mill and Riverville Mill have delivered as I hoped they would with efforts over the last few quarters. Incremental tons will continue to flow out of the acquired mills, and Jackson's project will bring on the committed tons. We have a few capital projects identified for next year that would bring on incremental tons—typically 25 to 50 thousand tons of annual incremental opportunity with some capital spending. No one big project, just a number of smaller, well-returning projects.
To add, when I said tight, I meant it both domestically and globally. It is our job to manage supply and identify ways to address it. There has not been the same level of investment in some places globally, and that is part of what we are seeing.
Perfect segue, Tom. On margins and returns, they've remained quite good even with the demand and inflation shock. Margins have been tight historically in the low-20% range. Given how tight supply-demand is now and the investments you have made, do you see the industry in a position to rebase the return margin profile higher? What is different this time around?
Over the last 8 to 9 years, and really over the last 15 years, we've spent significant capital to recapitalize and build new plants—roughly in the multi-billion-dollar range to enhance PCA's capability. That has enabled us to maintain the 20-plus percent margins. But ultimately, capital investment alone is not enough; you must back it up with price. We expect an appropriate return for that investment and we are not shy about saying that.
It all comes back to earning your cost of capital. We must be disciplined about customer growth and make sure we are serving customers profitably. We are fortunate we undertook recapitalization earlier because doing it now with today's cost of capital would be more challenging. We have a good runway and plans, but it requires discipline and the right pricing to support higher returns.
That makes sense. Thank you.
Thanks. Next question, please. Our next question comes from Hillary Cacanando from Deutsche Bank Securities. Please go ahead with your question.
Hi. Thanks for taking my questions. With input costs still being high, do you think there will need to be additional price increases later this year? Overall as an industry, not necessarily you specifically.
Hillary, we do not comment on price going forward, so we will leave it at that and let you draw your own conclusions.
Okay. Got it. Last quarter I think you said Riverville and Massillon facilities were operating about 10% above pre-acquisition levels. Could you talk about where those facilities are operating today in terms of percentage above pre-acquisition levels? Are there still meaningful productivity opportunities remaining?
Historically, with acquisitions and reconfigurations, we have often seen around a 30% improvement in productivity over time, sometimes 40% depending on capital invested. There is a point of diminishing returns for each dollar spent, so we are prudent in our analysis. We are only about nine months into the acquisition, and by September we will be lapping a full year. We are bullish on productivity coming out of both Massillon and Riverville. The cost to produce those tons has come down significantly and we expect to continue ramping up productivity. I won't give a specific number today, but historically we have done significantly more than we have already done.
Got it. Thank you very much.
Thank you. Any further questions? We have an additional question from George Staphos from Bank of America Securities. Please go ahead with your follow-up.
Hi again. Just wanted to come back to some of the cost factors in the second quarter and try to get at the earnings power more of a grab bag. On the outages that you were not expecting because of the utilities, what do you think that cost you? Also, can you talk about the corporate cost, where it shook out relative to what you were expecting, what was that variance? And maintenance this year relative to prior guide—seems maybe a nickel to a dime higher? Correct me if I'm wrong. I just want to run down those things. Thanks so much, and good luck in the quarter again.
Okay George, it is Kent. The corporate variance was largely a benefits obligation that was higher than forecast. It was a mark-to-market obligation on compensation and benefits and that was about a nickel variance from Q1 to Q2, and that showed up in the corporate segment.
And on the unplanned utility outages, what did that cost you? I recognize there's always stuff that goes wrong, but what was that impact?
Those utility disruptions probably cost us about 10 thousand tons of production in total.
Okay. And lastly, maintenance expense this year for the full year relative to the prior guide—are we a nickel or dime higher or what is the number now?
George, on full-year maintenance for the full company, we are at $1.41 for the year including Q4. I thought we brought it down a few cents from where we were at the end of Q1. I thought we were maybe a penny or two better coming into the quarter. I can clean that up and double-check after the call.
No worries. Probably my miscalculation, but I appreciate the color. Thanks, guys.
Thank you. Any other questions? Once again, if you would like to ask a question, please press star and 1. As there are no further questions at this time, I would like to turn the floor back over for closing remarks.
Thanks, Jamie, and thank you, everyone, for joining us on the call today. We appreciate everybody's time. We look forward to speaking with you in October and giving you the details and wrap up for Q3. Take care. Have a good day. Bye.
And with that, ladies and gentlemen, we thank you for joining today's presentation. You may now disconnect your lines.