Fourth Quarter and Fiscal Year 2014 Earnings Conference Call. As a reminder this call is being recorded today, February 04, 2015. I would now like to turn the conference over to Ms. Robin Yim, Vice President, Investor Relations of Clearwater Paper. Please go ahead.
Thank you, Amanda. Good afternoon and thank you for joining Clearwater Paper's fourth quarter and fiscal year 2014 earnings conference call. Joining me on the call today are Linda Massman, President and Chief Executive Officer and John Hertz, Chief Financial Officer.
Financial results for the fourth quarter were released shortly after today's market close. Posted on the Investor Relations page of our website at clearwaterpaper.com, you will find both the earnings press release and the presentation of supplemental information including outlook slide providing the company's current expectations and estimates as to net sales, operating margin, and adjusted EBITDA for the first quarter of 2015. And certain cost, pricing, shipment, production, maintenance and repairs, and other factors for the first quarter and full year 2015.
(Forward-Looking Cautionary Statements)
John Hertz will begin today's call with a review of the financial results for the fourth quarter and fiscal year 2014 and Linda Massman will provide an overview of the business environment and our outlook for the year and the first quarter of 2015. And then we will open up the call for the question-and-answer session.
Now I'll turn the call over to John.
John D. Hertz
Thank you, Robin. 2014 was a year of achievements and challenges for Clearwater Paper. We delivered record to net sales at $2 billion and adjusted EBITDA at $239 million
and in adjusted EPS at $3.47 per share. Our Pulp and Paperboard division delivered record adjusted EBITDA of $173 million or 22% of net sales which is well above the Paperboard division cross cycle model of 19%.
On the consumer product side, net sales increased 3% to a record $1.2 billion but the adjusted EBITDA margin of $116 million or a 10% of net sales was down from 11% in 2013, and well below the consumer divisions cross cycle model of 17% due to a combination of pricing pressure on conventional tissue and input cost inflation on pulp, energy, and transportation. From a capital structure and allocation perspective we further reduced our weighted average cost to capital with the issuance of $300 million in 5.38% 10 year senior notes in exchange for $375 million in 7.18% senior notes.
If you combine the impact of the 2014 refinancing with that of the 2013 refinancing, we have reduced annual cash interest payments from $56 million to $29 million and we have reduced our cost of debt from 8.6% to 5%.
We also returned $100 million to shareholders through our share buyback program at an average price of $63.50 per share. Since the 2012 inception of our stock buyback program, we have repurchased 4.5 million shares for $230 million, an average price of $51.13 and reduced shares outstanding by 20%. And on December 15th we
John D. Hertz
SVP and CFO
Linda K. Massman
President and CEO
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