Third Quarter 2024 Highlights and Financial Results
- Shifted operating structure into two distinct verticals, Food
and Protective, and announced both vertical presidents with strong
commercial packaging expertise
- Volume growth in Food driven by strong end-market demand and
competitive wins
- Protective industrial and fulfillment portfolios continue to be
weak
- Cost take-out on track to generate $90
million of incremental cost savings for full-year 2024
- Net leverage ratio reduced to 3.7x with maintained focus on
deleveraging the balance sheet
- Updating our financial outlook for 2024
CHARLOTTE, N.C., Nov. 7, 2024
/PRNewswire/ -- Sealed Air Corporation (NYSE: SEE) announced third
quarter 2024 financial results and business updates.
"With the shift into two verticals, Food and Protective, and the
onboarding of new leadership, we have positioned Sealed Air for
long-term success," said Patrick
Kivits, Sealed Air's CEO. "Over the coming months, we are
focused on operationalizing each vertical and finalizing the
long-term growth strategy for each business. In parallel, we are
stepping up our cost take-out initiatives to right-size each
business and improve profitability until our transformation takes
hold."
"While our third quarter results were ahead of expectation, the
strength of our Food business continues to be offset by continued
softness in our Protective portfolio. As a result, we are
maintaining the midpoint of our Sales and Adjusted EBITDA
guidance," said Dustin Semach,
Sealed Air's President and CFO. "We continue to improve underlying
cash generation fundamentals, optimize our debt and tax rate, and
as a result, we are raising our guidance for Free Cash Flow and
Adjusted EPS for the year."
|
($ millions, except per
share data)
|
|
|
|
|
GAAP
Results
|
Third
Quarter
|
|
|
|
2024
|
2023
|
Reported
△%
|
Constant Currency
△%
|
|
Net Sales
|
$1,345.1
|
$1,381.8
|
(2.7) %
|
(2.3) %
|
|
Net Earnings
|
$88.7
|
$57 .6
|
54.0 %
|
|
|
Diluted EPS
|
$0.61
|
$0.40
|
52.5 %
|
|
|
Cash Flow from
Operations (YTD)
|
$483.8
|
$192.5
|
151.3 %
|
|
|
|
|
|
|
Non-GAAP
Results
|
Third
Quarter
|
|
|
|
2024
|
2023
|
Reported
△%
|
|
|
Adjusted
EBITDA
|
$276.0
|
$284.7
|
(3.1) %
|
|
|
Adjusted Net
Earnings
|
$115.7
|
$111.5
|
3.8 %
|
|
|
Adjusted Diluted
EPS
|
$0.79
|
$0.77
|
2.6 %
|
|
|
Free Cash Flow
(YTD)
|
$322.7
|
$182.5(1)
|
76.8 %
|
|
|
|
(1) 2023
excludes the impact of a $175 million tax deposit to resolve
certain U.S. tax matters.
|
|
|
Unless otherwise
stated, all results compare third quarter 2024 results to third
quarter 2023 results from continuing operations. Year-over-year
financial discussions present operating results from continuing
operations as reported.
|
Third Quarter 2024 Financial Highlights
Net sales of $1.35 billion
decreased 3% as reported, with APAC increasing 4% and the Americas
and EMEA regions both decreasing 4%. Net sales decreased
$32 million, or 2%, on a constant
dollar basis. Price had an unfavorable impact of $26 million, or 2%. Volumes decreased by
$6 million, or less than 1%.
Income tax expense was $31
million, resulting in an effective tax rate of 25.7% in the
quarter. This compares to an income tax expense of $20 million in the prior year, or an effective
tax rate of 26.1%. The Adjusted Tax Rate was 24.0% in the quarter,
as compared to 25.7% in the prior year.
Net earnings were $89 million, or
$0.61 per diluted share, as compared
to net earnings of $58 million, or
$0.40 per diluted share in the prior
year. The current year results were unfavorably impacted by
$33 million of Special Items expense,
including $16 million of
restructuring and other associated costs related to the cost
take-out to grow program ("CTO2Grow Program") and $8 million related to the amortization of
Liquibox intangible assets. The prior year results were unfavorably
impacted by $72 million of Special
Items expense, including $51 million
related to business closure activity. Adjusted earnings per diluted
share increased to $0.79, from
$0.77 in the prior year, primarily
due to lower interest and tax expense, partially offset by lower
Adjusted EBITDA.
Adjusted EBITDA was $276 million,
or 20.5% of net sales, as compared to $285
million, or 20.6% in the prior year. The decrease in
Adjusted EBITDA was primarily due to lower volumes and unfavorable
net price realization in Protective, partially offset by
lower operating costs driven by productivity benefits as a result
of the CTO2Grow Program.
Business Segment Highlights
Third quarter net sales in Food were $898 million, an increase of approximately 1% as
reported. Currency fluctuations had an unfavorable impact of
$5 million, or less than 1%. On
a constant dollar basis, net sales increased $9 million, or 1%. Volumes increased $21 million, or 2%, with growth in all regions
driven by strength in end-market demand and competitive share
gains. Price had an unfavorable impact of $12 million, or 1%. Adjusted EBITDA of
$206 million, or 22.9% of net sales,
increased 6% from $194 million, or
21.7% of net sales. The increase in Adjusted EBITDA was driven by
higher volumes, favorable net price realization and lower operating
costs driven by productivity benefits, including our CTO2Grow
Program.
Third quarter net sales in Protective were $447 million, a decrease of 8% as reported.
Currency fluctuations had an unfavorable impact of less than
$1 million. On a constant dollar
basis, net sales decreased $41
million, or 8%. Volumes decreased $28
million, or 6%, resulting from continued weakness in our
industrial and fulfillment portfolios. Price had an unfavorable
impact of $13 million, or 3%.
Adjusted EBITDA of $75 million, or
16.9% of net sales, decreased 21% from $95
million, or 19.5% of net sales. The decrease in Adjusted
EBITDA was primarily attributable to lower volumes and unfavorable
net price realization, partially offset by lower operating costs
driven by productivity benefits, including our CTO2Grow
Program.
Cash Flow and Net Debt
Cash flow from operating activities during the first nine months
of 2024 was a source of $484 million,
as compared to a source of $193
million during the prior year period, which included a
$175 million tax deposit.
Capital expenditures in the first nine months of 2024 were
$161 million, as compared to
$185 million during the prior year
period. Free Cash Flow, defined as net cash from operating
activities less capital expenditures, was a source of $323 million for the first nine months of 2024,
as compared to a source of $8 million
during the prior year period. Excluding the $175 million tax deposit, Free Cash Flow was a
source of $183 million for the first
nine months of 2023.
Dividend payments for the first nine months of both 2024 and
2023 were $89 million.
Total debt was $4.5 billion as of
September 30, 2024 and $4.7 billion as of December 31, 2023. Net Debt, defined as total
debt less cash and cash equivalents, was $4.1 billion as of September 30, 2024 and $4.3 billion as of December 31, 2023. As of September 30, 2024, SEE had approximately
$1.4 billion of available liquidity
comprised of $386 million of cash and
$1.0 billion of available and unused
lines of credit under our committed credit facilities. The net
leverage ratio, defined as net debt divided by last twelve months
Adjusted EBITDA, decreased to 3.7x as of September 30, 2024 as compared to 3.9x as of
December 31, 2023.
Updated 2024 Full Year Outlook
|
Net Sales
|
$5.375 to $5.425
billion
|
|
Adjusted
EBITDA
|
$1.09 to $1.11
billion
|
|
Adjusted EPS
|
$3.00 to
$3.10
|
|
Free Cash
Flow
|
$350 to $450
million
|
Adjusted EBITDA, Adjusted EPS and Free Cash Flow are non-GAAP
financial measures. We have not provided guidance for the most
directly comparable GAAP financial measures, as they are not
available without unreasonable effort due to the high variability,
complexity and low visibility of certain Special Items.
Conference Call Information
Sealed Air Corporation will host a conference call and webcast
on Thursday, November 7, 2024 at 10:00 a.m. (ET) to
discuss our Third Quarter 2024 Results. The conference call will be
webcast live on the Investors homepage at
www.sealedair.com/investors. A replay of the webcast will also be
available thereafter. A slide presentation, which includes
supplemental information relating to the Company's third quarter
earnings will be made available through the "Presentations &
Events" section of the Company's Investor Relations website
at https://ir.sealedair.com/events-and-presentations prior to
the call.
About Sealed Air
Sealed Air Corporation (NYSE: SEE), is a leading global provider
of packaging solutions that integrate sustainable, high-performance
materials, automation, equipment and services. Sealed Air designs,
manufactures and delivers packaging solutions that preserve food,
protect goods and automate packaging processes. We deliver our
packaging solutions to an array of end markets including fresh
proteins, foods, fluids and liquids, medical and life science,
e-commerce retail, logistics and omnichannel fulfillment
operations, and industrials. Our globally recognized solution
brands include CRYOVAC® brand food packaging,
LIQUIBOX® brand liquids systems, SEALED
AIR® brand protective packaging,
AUTOBAG® brand automated packaging systems, and
BUBBLE WRAP® brand packaging. In 2023, Sealed Air
generated $5.5 billion in sales and
has approximately 17,000 employees who serve customers in
115 countries/territories.
www.sealedair.com
Website Information
We routinely post important information for investors on our
website, www.sealedair.com, in the Investors section. We use this
website as a means of disclosing material, non-public information
and for complying with our disclosure obligations under Regulation
FD. Accordingly, investors should monitor the Investors section of
our website, in addition to following our press releases, SEC
filings, public conference calls, presentations and webcasts. The
information contained on, or that may be accessed through, our
website is not incorporated by reference into, and is not a part
of, this document.
Non-GAAP Information
In this press release, we include certain non-GAAP financial
measures, including Net Debt, Adjusted Net Earnings and Adjusted
EPS, net sales on an "organic" and a "constant dollar" basis, Free
Cash Flow, Adjusted EBITDA, Adjusted EBITDA Margin, net leverage
ratio and Adjusted Tax Rate. Management uses non-GAAP financial
measures to assess operating and financial performance, set
budgets, provide guidance and compare with peers' performance. We
believe such non-GAAP financial measures are useful to investors.
Non-GAAP financial measures should not be considered in isolation
from or as a substitute for GAAP information. See the attached
supplementary information for reconciliations of non-GAAP financial
measures to their most directly comparable GAAP financial measures.
Information reconciling forward-looking non-GAAP financial measures
to their most directly comparable GAAP financial measures is not
presented because it is not available without unreasonable effort.
The reconciling information that is not available includes
forward-looking ranges of certain Special Items with high
variability, complexity and low visibility. We are unable to
address the probable significance of such unavailable information,
which could have a potential significant impact on our future GAAP
financial results.
Forward-Looking Statements
This press release contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements can be identified by such words
as "anticipate," "believe," "plan," "assume," "could," "should,"
"estimate," "expect," "intend," "potential," "seek," "predict,"
"may," "will" or the negative of these terms and similar
expressions. All statements contained in this press release, other
than statements of historical facts, such as those regarding our
growth initiatives, business strategies, operating plans, business
outlook, restructuring activities and market conditions, are
forward-looking statements. These statements are neither promises
nor guarantees, but involve known and unknown risks and
uncertainties that may cause our actual results to differ
materially from any future results expressed or implied by the
forward-looking statements. These risks include important factors
discussed in the "Risk Factors" section in Part I of our most
recent Annual Report on Form 10-K, as updated by our other filings
with the Securities and Exchange Commission.
Any forward-looking statements made by us in this press release
are based solely on management's estimates as of the date of this
press release. While we may elect to update such forward-looking
statements, we disclaim any obligation to do so even if subsequent
events cause our views to change, except as may be required by
applicable law.
Company Contacts
Investors
Brian
Sullivan
brian.c.sullivan@sealedair.com
704.503.8841
Louise Lagache
louise.lagache@sealedair.com
Media
Amanda
Hoggarth
amanda.hoggarth@sealedair.com
|
Sealed Air
Corporation
Condensed
Consolidated Statements of Operations
(Unaudited)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
(In USD
millions, except per share data)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net sales
|
|
$
1,345.1
|
|
$
1,381.8
|
|
$
4,019.8
|
|
$
4,111.4
|
|
Cost of
sales
|
|
943.6
|
|
968.5
|
|
2,801.5
|
|
2,875.0
|
|
Gross
profit
|
|
401.5
|
|
413.3
|
|
1,218.3
|
|
1,236.4
|
|
Selling, general and
administrative expenses
|
|
187.1
|
|
181.8
|
|
563.8
|
|
582.6
|
|
Loss on disposal of
businesses and property and equipment, net
|
|
(5.4)
|
|
(48.7)
|
|
(5.8)
|
|
(55.2)
|
|
Amortization expense of
intangible assets
|
|
15.9
|
|
15.4
|
|
47.0
|
|
46.0
|
|
Restructuring
charges
|
|
6.8
|
|
9.8
|
|
24.8
|
|
9.2
|
|
Operating
profit
|
|
186.3
|
|
157.6
|
|
576.9
|
|
543.4
|
|
Interest expense,
net
|
|
(60.5)
|
|
(70.1)
|
|
(188.9)
|
|
(196.6)
|
|
Other expense,
net
|
|
(6.4)
|
|
(9.6)
|
|
(14.0)
|
|
(33.0)
|
|
Earnings before income
tax provision
|
|
119.4
|
|
77.9
|
|
374.0
|
|
313.8
|
|
Income tax
provision
|
|
30.7
|
|
20.3
|
|
104.1
|
|
99.4
|
|
Net earnings from
continuing operations
|
|
88.7
|
|
57.6
|
|
269.9
|
|
214.4
|
|
Gain (Loss) on sale of
discontinued operations, net of tax
|
|
3.0
|
|
(1.0)
|
|
2.1
|
|
3.2
|
|
Net
earnings
|
|
$
91.7
|
|
$
56.6
|
|
$
272.0
|
|
$
217.6
|
|
Basic:
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
0.61
|
|
$
0.40
|
|
$
1.86
|
|
$
1.49
|
|
Discontinued
operations
|
|
0.02
|
|
(0.01)
|
|
0.01
|
|
0.02
|
|
Net earnings per
common share - basic
|
|
$
0.63
|
|
$
0.39
|
|
$
1.87
|
|
$
1.51
|
|
Weighted average common
shares outstanding - basic
|
|
145.8
|
|
144.5
|
|
145.5
|
|
144.3
|
|
|
|
|
|
|
|
|
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
0.61
|
|
$
0.40
|
|
$
1.85
|
|
$
1.48
|
|
Discontinued
operations
|
|
0.02
|
|
(0.01)
|
|
0.02
|
|
0.02
|
|
Net earnings per
common share - diluted
|
|
$
0.63
|
|
$
0.39
|
|
$
1.87
|
|
$
1.50
|
|
Weighted average common
shares outstanding - diluted
|
|
146.1
|
|
144.9
|
|
145.8
|
|
144.8
|
|
Sealed Air
Corporation
Condensed
Consolidated Balance Sheets
(Unaudited)
|
|
(In USD
millions)
|
|
September 30,
2024
|
|
December 31,
2023
|
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
386.0
|
|
$
346.1
|
|
Trade receivables,
net
|
|
478.7
|
|
442.6
|
|
Income tax
receivables
|
|
19.7
|
|
44.9
|
|
Other
receivables
|
|
95.6
|
|
94.2
|
|
Advances and
deposits
|
|
67.4
|
|
72.8
|
|
Inventories,
net
|
|
807.3
|
|
774.3
|
|
Prepaid expenses and
other current assets
|
|
204.8
|
|
188.4
|
|
Total current
assets
|
|
2,059.5
|
|
1,963.3
|
|
Property and equipment,
net
|
|
1,438.0
|
|
1,416.4
|
|
Goodwill
|
|
2,896.8
|
|
2,892.5
|
|
Identifiable intangible
assets, net
|
|
397.6
|
|
439.0
|
|
Deferred
taxes
|
|
151.8
|
|
130.8
|
|
Operating lease
right-of-use-assets
|
|
97.5
|
|
86.5
|
|
Other non-current
assets
|
|
279.9
|
|
272.1
|
|
Total
assets
|
|
$
7,321.1
|
|
$
7,200.6
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
borrowings
|
|
$
139.7
|
|
$
140.7
|
|
Current portion of
long-term debt
|
|
58.1
|
|
35.7
|
|
Current portion of
operating lease liabilities
|
|
29.1
|
|
29.2
|
|
Accounts
payable
|
|
800.9
|
|
764.6
|
|
Accrued restructuring
costs
|
|
17.9
|
|
23.1
|
|
Income tax
payable
|
|
47.5
|
|
28.7
|
|
Other current
liabilities
|
|
499.7
|
|
487.0
|
|
Total current
liabilities
|
|
1,592.9
|
|
1,509.0
|
|
Long-term debt, less
current portion
|
|
4,334.0
|
|
4,513.9
|
|
Long-term operating
lease liabilities, less current portion
|
|
75.0
|
|
66.7
|
|
Deferred
taxes
|
|
36.0
|
|
35.8
|
|
Other non-current
liabilities
|
|
512.0
|
|
525.7
|
|
Total
liabilities
|
|
6,549.9
|
|
6,651.1
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
Preferred
stock
|
|
—
|
|
—
|
|
Common
stock
|
|
15.5
|
|
15.4
|
|
Additional paid-in
capital
|
|
1,438.3
|
|
1,429.5
|
|
Retained
earnings
|
|
680.1
|
|
496.5
|
|
Common stock in
treasury
|
|
(404.2)
|
|
(436.4)
|
|
Accumulated other
comprehensive loss, net of taxes
|
|
(958.5)
|
|
(955.5)
|
|
Total stockholders'
equity
|
|
771.2
|
|
549.5
|
|
Total liabilities
and stockholders' equity
|
|
$
7,321.1
|
|
$
7,200.6
|
|
Sealed Air
Corporation
Condensed
Consolidated Statements of Cash Flows
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
Net earnings
|
|
$
272.0
|
|
$
217.6
|
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities(1)
|
|
233.7
|
|
279.7
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Trade receivables,
net
|
|
(42.8)
|
|
18.1
|
|
Inventories,
net
|
|
(56.2)
|
|
60.2
|
|
Accounts
payable
|
|
36.5
|
|
(132.7)
|
|
Customer advance
payments
|
|
(5.5)
|
|
(9.8)
|
|
Income tax
receivable/payable
|
|
44.7
|
|
(9.9)
|
|
Tax deposit
|
|
—
|
|
(175.0)
|
|
Other assets and
liabilities
|
|
1.4
|
|
(55.7)
|
|
Net
cash provided by operating activities
|
|
$
483.8
|
|
$
192.5
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
Capital
expenditures
|
|
(161.1)
|
|
(185.0)
|
|
Proceeds related to
sale of business and property and equipment, net
|
|
0.7
|
|
1.9
|
|
Business acquired in
purchase transactions, net of cash acquired
|
|
4.2
|
|
(1,162.9)
|
|
(Payments) proceeds
associated with debt, equity and equity method
investments
|
|
(1.1)
|
|
3.3
|
|
Settlement of foreign
currency forward contracts
|
|
(11.0)
|
|
15.1
|
|
Proceeds from
cross-currency swaps
|
|
3.1
|
|
1.6
|
|
Net cash used in
investing activities
|
|
$
(165.2)
|
|
$
(1,326.0)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
Net (payments)
proceeds from short-term borrowings
|
|
(1.6)
|
|
206.6
|
|
Proceeds from
long-term debt
|
|
413.4
|
|
1,411.4
|
|
Payments of long-term
debt
|
|
(582.1)
|
|
(433.2)
|
|
Payments of debt
modification/extinguishment costs and other
|
|
(7.3)
|
|
(14.1)
|
|
Dividends paid on
common stock
|
|
(88.8)
|
|
(88.9)
|
|
Impact of tax
withholding on share-based compensation
|
|
(9.2)
|
|
(21.3)
|
|
Repurchases of common
stock
|
|
—
|
|
(79.9)
|
|
Principal payments
related to financing leases
|
|
(6.1)
|
|
(6.4)
|
|
Net cash (used in)
provided by financing activities
|
|
$
(281.7)
|
|
$
974.2
|
|
Effect of foreign
currency exchange rate changes on cash and cash
equivalents
|
|
$
3.0
|
|
$
(15.5)
|
|
Cash and cash
equivalents
|
|
346.1
|
|
456.1
|
|
Restricted cash and
cash equivalents
|
|
—
|
|
—
|
|
Balance, beginning
of period
|
|
$
346.1
|
|
$
456.1
|
|
Net change during
the period
|
|
$
39.9
|
|
$
(174.8)
|
|
Cash and cash
equivalents
|
|
386.0
|
|
281.3
|
|
Restricted cash and
cash equivalents
|
|
—
|
|
—
|
|
Balance, end of
period
|
|
$
386.0
|
|
$
281.3
|
|
|
|
|
|
|
Non-GAAP Free Cash
Flow:
|
|
|
|
|
|
Cash flow from
operating activities
|
|
$
483.8
|
|
$
192.5
|
|
Capital
expenditures
|
|
(161.1)
|
|
(185.0)
|
|
Non-GAAP Free Cash
Flow
|
|
$
322.7
|
|
$
7.5
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
Supplemental Cash
Flow Information:
|
|
|
|
|
|
Interest
payments
|
|
$
220.3
|
|
$
201.7
|
|
Income tax payments,
net of cash refunds(2)
|
|
$
74.9
|
|
$
310.1
|
|
Restructuring payments
including associated costs
|
|
$
43.5
|
|
$
12.4
|
|
Non-cash
items:
|
|
|
|
|
|
Transfers of shares of
common stock from treasury for
profit-sharing contributions
|
|
$
25.4
|
|
$
23.9
|
|
____________
|
|
(1)
|
2024 adjustments
primarily consist of depreciation and amortization of $183 million,
share-based compensation expense of approximately $23 million,
profit sharing expense of $20 million, provision for inventory
obsolescence of $17 million and loss on debt redemption and
refinancing activities of $7 million. 2023 adjustments primarily
consist of depreciation and amortization of $175 million, net loss
associated with the disposal of businesses of $53 million,
share-based compensation expense of $31 million, profit sharing
expense of $19 million, provision for inventory obsolescence of $15
million, and loss on debt redemption and refinancing activities of
$5 million.
|
|
(2)
|
2023 includes a $175
million tax deposit related to the resolution of certain U.S. tax
matters that was made during the second quarter of 2023. Excluding
the $175 million tax deposit, Income tax payments, net of cash
refunds were $135 million for the nine months ended September 30,
2023.
|
|
Sealed Air
Corporation
Components of Change
in Net Sales by Segment
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
(In USD
millions)
|
|
Food
|
|
Protective
|
|
Total
Company
|
|
2023 Net
Sales
|
|
$
893.4
|
|
64.7 %
|
|
$
488.4
|
|
35.3 %
|
|
$ 1,381.8
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price
|
|
(12.2)
|
|
(1.4) %
|
|
(13.4)
|
|
(2.7) %
|
|
(25.6)
|
|
(1.8) %
|
|
Volume(1)
|
|
21.3
|
|
2.4 %
|
|
(27.6)
|
|
(5.7) %
|
|
(6.3)
|
|
(0.5) %
|
|
Total constant dollar
change (non-GAAP)(2)
|
|
9.1
|
|
1.0 %
|
|
(41.0)
|
|
(8.4) %
|
|
(31.9)
|
|
(2.3) %
|
|
Foreign currency
translation
|
|
(4.6)
|
|
(0.5) %
|
|
(0.2)
|
|
— %
|
|
(4.8)
|
|
(0.4) %
|
|
Total change
(GAAP)
|
|
4.5
|
|
0.5 %
|
|
(41.2)
|
|
(8.4) %
|
|
(36.7)
|
|
(2.7) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$
897.9
|
|
66.8 %
|
|
$
447.2
|
|
33.2 %
|
|
$ 1,345.1
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
(In USD
millions)
|
|
Food
|
|
Protective
|
|
Total
Company
|
|
2023 Net
Sales
|
|
$ 2,627.1
|
|
63.9 %
|
|
$ 1,484.3
|
|
36.1 %
|
|
$ 4,111.4
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price
|
|
(71.1)
|
|
(2.7) %
|
|
(43.4)
|
|
(2.9) %
|
|
(114.5)
|
|
(2.8) %
|
|
Volume(1)
|
|
93.0
|
|
3.5 %
|
|
(75.5)
|
|
(5.1) %
|
|
17.5
|
|
0.4 %
|
|
Total organic change
(non-GAAP)(2)
|
|
21.9
|
|
0.8 %
|
|
(118.9)
|
|
(8.0) %
|
|
(97.0)
|
|
(2.4) %
|
|
Acquisition
|
|
23.5
|
|
0.9 %
|
|
—
|
|
— %
|
|
23.5
|
|
0.6 %
|
|
Total constant dollar
change (non-GAAP)(2)
|
|
45.4
|
|
1.7 %
|
|
(118.9)
|
|
(8.0) %
|
|
(73.5)
|
|
(1.8) %
|
|
Foreign currency
translation
|
|
(12.4)
|
|
(0.4) %
|
|
(5.7)
|
|
(0.4) %
|
|
(18.1)
|
|
(0.4) %
|
|
Total change
(GAAP)
|
|
33.0
|
|
1.3 %
|
|
(124.6)
|
|
(8.4) %
|
|
(91.6)
|
|
(2.2) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$ 2,660.1
|
|
66.2 %
|
|
$ 1,359.7
|
|
33.8 %
|
|
$ 4,019.8
|
|
100.0 %
|
|
Components of Change
in Net Sales by Region
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
(In USD
millions)
|
|
Americas
|
|
EMEA
|
|
APAC
|
|
Total
|
|
2023 Net
Sales
|
|
$
908.0
|
|
65.7 %
|
|
$
285.4
|
|
20.7 %
|
|
$
188.4
|
|
13.6 %
|
|
$
1,381.8
|
|
100.0 %
|
|
Price
|
|
(14.0)
|
|
(1.6) %
|
|
(9.5)
|
|
(3.4) %
|
|
(2.1)
|
|
(1.1) %
|
|
(25.6)
|
|
(1.8) %
|
|
Volume(1)
|
|
(6.7)
|
|
(0.7) %
|
|
(7.5)
|
|
(2.6) %
|
|
7.9
|
|
4.2 %
|
|
(6.3)
|
|
(0.5) %
|
|
Total constant dollar
change (non-GAAP)(2)
|
|
(20.7)
|
|
(2.3) %
|
|
(17.0)
|
|
(6.0) %
|
|
5.8
|
|
3.1 %
|
|
(31.9)
|
|
(2.3) %
|
|
Foreign currency
translation
|
|
(11.3)
|
|
(1.2) %
|
|
4.7
|
|
1.7 %
|
|
1.8
|
|
0.9 %
|
|
(4.8)
|
|
(0.4) %
|
|
Total change
(GAAP)
|
|
(32.0)
|
|
(3.5) %
|
|
(12.3)
|
|
(4.3) %
|
|
7.6
|
|
4.0 %
|
|
(36.7)
|
|
(2.7) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$
876.0
|
|
65.1 %
|
|
$
273.1
|
|
20.3 %
|
|
$
196.0
|
|
14.6 %
|
|
$
1,345.1
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
(In USD
millions)
|
|
Americas
|
|
EMEA
|
|
APAC
|
|
Total
|
|
2023 Net
Sales
|
|
$
2,695.6
|
|
65.6 %
|
|
$
863.9
|
|
21.0 %
|
|
$
551.9
|
|
13.4 %
|
|
$
4,111.4
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price
|
|
(76.2)
|
|
(2.8) %
|
|
(33.5)
|
|
(3.9) %
|
|
(4.8)
|
|
(0.9) %
|
|
(114.5)
|
|
(2.8) %
|
|
Volume(1)
|
|
20.6
|
|
0.7 %
|
|
(15.7)
|
|
(1.8) %
|
|
12.6
|
|
2.3 %
|
|
17.5
|
|
0.4 %
|
|
Total organic change
(non-GAAP)(2)
|
|
(55.6)
|
|
(2.1) %
|
|
(49.2)
|
|
(5.7) %
|
|
7.8
|
|
1.4 %
|
|
(97.0)
|
|
(2.4) %
|
|
Acquisition
|
|
17.2
|
|
0.7 %
|
|
4.0
|
|
0.5 %
|
|
2.3
|
|
0.4 %
|
|
23.5
|
|
0.6 %
|
|
Total constant dollar
change (non-GAAP)(2)
|
|
(38.4)
|
|
(1.4) %
|
|
(45.2)
|
|
(5.2) %
|
|
10.1
|
|
1.8 %
|
|
(73.5)
|
|
(1.8) %
|
|
Foreign currency
translation
|
|
(6.6)
|
|
(0.3) %
|
|
1.7
|
|
0.2 %
|
|
(13.2)
|
|
(2.4) %
|
|
(18.1)
|
|
(0.4) %
|
|
Total change
(GAAP)
|
|
(45.0)
|
|
(1.7) %
|
|
(43.5)
|
|
(5.0) %
|
|
(3.1)
|
|
(0.6) %
|
|
(91.6)
|
|
(2.2) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$
2,650.6
|
|
65.9 %
|
|
$
820.4
|
|
20.4 %
|
|
$
548.8
|
|
13.7 %
|
|
$
4,019.8
|
|
100.0 %
|
|
____________
|
|
(1)
|
Our volume reported
above includes the net impact of changes in unit volume as well as
the period-to-period change in the mix of products sold.
|
|
(2)
|
Total organic change is
a non-GAAP financial measure which excludes acquisitions within the
first twelve months after acquisition, divestiture activity from
the time of the sale, and the impact of foreign currency
translation. Total constant dollar change is a non-GAAP financial
measure which excludes the impact of foreign currency
translation.
|
|
Sealed Air
Corporation
Segment
Information
Reconciliation of
Net Earnings to Non-GAAP Consolidated Adjusted
EBITDA
(Unaudited)
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Adjusted EBITDA from
continuing operations:
|
|
|
|
|
|
|
|
|
|
Food
|
|
$
205.9
|
|
$
194.3
|
|
$
600.1
|
|
$
580.1
|
|
Adjusted EBITDA
Margin(1)
|
|
22.9 %
|
|
21.7 %
|
|
22.6 %
|
|
22.1 %
|
|
Protective
|
|
75.5
|
|
95.0
|
|
246.8
|
|
271.3
|
|
Adjusted EBITDA
Margin(1)
|
|
16.9 %
|
|
19.5 %
|
|
18.2 %
|
|
18.3 %
|
|
Corporate
|
|
(5.4)
|
|
(4.6)
|
|
(7.1)
|
|
(19.1)
|
|
Non-GAAP
Consolidated Adjusted EBITDA
|
|
$
276.0
|
|
$
284.7
|
|
$
839.8
|
|
$
832.3
|
|
Adjusted EBITDA
Margin(1)
|
|
20.5 %
|
|
20.6 %
|
|
20.9 %
|
|
20.2 %
|
|
_________
|
|
|
|
|
|
|
|
|
|
(1)
Adjusted EBITDA divided by net sales.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
GAAP Net earnings
from continuing operations
|
|
$
88.7
|
|
$
57.6
|
|
$
269.9
|
|
$
214.4
|
|
Interest expense,
net
|
|
60.5
|
|
70.1
|
|
188.9
|
|
196.6
|
|
Income tax
provision
|
|
30.7
|
|
20.3
|
|
104.1
|
|
99.4
|
|
Depreciation and
amortization, net of adjustments(1)
|
|
63.2
|
|
64.6
|
|
184.2
|
|
187.1
|
|
Special
Items:
|
|
|
|
|
|
|
|
|
|
Liquibox intangible
amortization
|
|
7.5
|
|
7.4
|
|
22.7
|
|
19.9
|
|
Liquibox inventory
step-up expense
|
|
—
|
|
—
|
|
—
|
|
10.8
|
|
Restructuring
charges
|
|
6.8
|
|
9.8
|
|
24.8
|
|
9.2
|
|
Other restructuring
associated costs
|
|
9.0
|
|
34.6
|
|
22.2
|
|
34.5
|
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
2.4
|
|
4.9
|
|
7.9
|
|
10.6
|
|
Loss on debt
redemption and refinancing activities
|
|
—
|
|
—
|
|
6.8
|
|
4.9
|
|
Contract
terminations
|
|
—
|
|
15.3
|
|
(0.1)
|
|
15.3
|
|
Charges related to
acquisition and divestiture activity
|
|
4.1
|
|
2.8
|
|
3.2
|
|
24.5
|
|
Other Special
Items
|
|
3.1
|
|
(2.7)
|
|
5.2
|
|
5.1
|
|
Pre-tax impact of
Special items
|
|
32.9
|
|
72.1
|
|
92.7
|
|
134.8
|
|
Non-GAAP
Consolidated Adjusted EBITDA
|
|
$
276.0
|
|
$
284.7
|
|
$
839.8
|
|
$
832.3
|
|
__________
|
|
(1)
Depreciation and amortization by segment are as follows:
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Food
|
|
$
47.9
|
|
$
48.1
|
|
$
141.1
|
|
$
135.8
|
|
Protective
|
|
22.8
|
|
23.9
|
|
65.8
|
|
71.2
|
|
Consolidated
depreciation and amortization(i)
|
|
$
70.7
|
|
$
72.0
|
|
$
206.9
|
|
$
207.0
|
|
Liquibox intangible
amortization
|
|
(7.5)
|
|
(7.4)
|
|
(22.7)
|
|
(19.9)
|
|
Depreciation and
amortization, net of adjustments
|
|
$
63.2
|
|
$
64.6
|
|
$
184.2
|
|
$
187.1
|
|
____________
|
|
(i)
|
Includes share-based
incentive compensation of $8.5 million and $24.4 million for the
three and nine months ended September 30, 2024, respectively, $12.1
million and $32.3 million for the three and nine months ended
September 30, 2023, respectively.
|
|
The calculation of the
non-GAAP Adjusted Tax Rate is as follows:
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
(In USD
millions)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
GAAP Earnings before
income tax provision from continuing operations
|
|
$
119.4
|
|
$
77.9
|
|
$
374.0
|
|
$
313.8
|
|
Pre-tax impact of
Special Items
|
|
32.9
|
|
72.1
|
|
92.7
|
|
134.8
|
|
Non-GAAP Adjusted
Earnings before income tax provision
|
|
$
152.3
|
|
$
150.0
|
|
$
466.7
|
|
$
448.6
|
|
|
|
|
|
|
|
|
|
|
GAAP Income tax
provision from continuing operations
|
|
$
30.7
|
|
$
20.3
|
|
$
104.1
|
|
$
99.4
|
|
Tax Special
Items(1)
|
|
(1.8)
|
|
1.4
|
|
(8.6)
|
|
(10.6)
|
|
Tax impact of Special
Items
|
|
7.7
|
|
16.8
|
|
22.0
|
|
25.9
|
|
Non-GAAP Adjusted
Income tax provision
|
|
$
36.6
|
|
$
38.5
|
|
$
117.5
|
|
$
114.7
|
|
|
|
|
|
|
|
|
|
|
GAAP Effective income
tax rate
|
|
25.7 %
|
|
26.1 %
|
|
27.8 %
|
|
31.7 %
|
|
Non-GAAP Adjusted Tax
Rate
|
|
24.0 %
|
|
25.7 %
|
|
25.2 %
|
|
25.6 %
|
|
____________
|
|
(1)
|
For the three and nine
months ended September 30, 2024 and September 30, 2023,
Tax Special Items primarily reflect accruals for uncertain tax
positions.
|
|
Sealed Air
Corporation
Reconciliation of
Net Earnings and Net Earnings Per Common Share to Non-GAAP
Adjusted
Net Earnings and
Non-GAAP Adjusted Net Earnings Per Common Share
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(In USD millions,
except per share data)
|
|
Net
Earnings
|
|
Diluted
EPS
|
|
Net
Earnings
|
|
Diluted
EPS
|
|
Net
Earnings
|
|
Diluted
EPS
|
|
Net
Earnings
|
|
Diluted
EPS
|
|
GAAP net earnings
and
diluted EPS from
continuing operations
|
|
$ 88.7
|
|
$
0.61
|
|
$ 57.6
|
|
$ 0.40
|
|
$
269.9
|
|
$
1.85
|
|
$
214.4
|
|
$ 1.48
|
|
Special
Items(1)
|
|
27.0
|
|
0.18
|
|
53.9
|
|
0.37
|
|
79.3
|
|
0.54
|
|
119.5
|
|
0.83
|
|
Non-GAAP adjusted
net
earnings and adjusted
diluted EPS
|
|
$
115.7
|
|
$
0.79
|
|
$
111.5
|
|
$ 0.77
|
|
$
349.2
|
|
$
2.39
|
|
$
333.9
|
|
$ 2.31
|
|
Weighted average
number of
common shares
outstanding - Diluted
|
|
|
|
146.1
|
|
|
|
144.9
|
|
|
|
145.8
|
|
|
|
144.8
|
|
___________
|
|
(1)
Special Items include items in the table below.
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
(In USD millions,
except per share data)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Special
Items:
|
|
|
|
|
|
|
|
|
|
Liquibox intangible
amortization
|
|
$
7.5
|
|
$
7.4
|
|
$
22.7
|
|
$
19.9
|
|
Liquibox inventory
step-up expense
|
|
—
|
|
—
|
|
—
|
|
10.8
|
|
Restructuring
charges
|
|
6.8
|
|
9.8
|
|
24.8
|
|
9.2
|
|
Other restructuring
associated costs(i)
|
|
9.0
|
|
34.6
|
|
22.2
|
|
34.5
|
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
2.4
|
|
4.9
|
|
7.9
|
|
10.6
|
|
Loss on debt
redemption and refinancing activities
|
|
—
|
|
—
|
|
6.8
|
|
4.9
|
|
Contract
terminations(ii)
|
|
—
|
|
15.3
|
|
(0.1)
|
|
15.3
|
|
Charges related to
acquisition and divestiture activity(iii)
|
|
4.1
|
|
2.8
|
|
3.2
|
|
24.5
|
|
Other Special
Items(iv)
|
|
3.1
|
|
(2.7)
|
|
5.2
|
|
5.1
|
|
Pre-tax impact of
Special Items
|
|
32.9
|
|
72.1
|
|
92.7
|
|
134.8
|
|
Tax impact of Special
Items and Tax Special Items
|
|
(5.9)
|
|
(18.2)
|
|
(13.4)
|
|
(15.3)
|
|
Net impact of
Special Items
|
|
$
27.0
|
|
$
53.9
|
|
$
79.3
|
|
$
119.5
|
|
Weighted average
number of common shares outstanding - Diluted
|
|
146.1
|
|
144.9
|
|
145.8
|
|
144.8
|
|
Loss per share
impact from Special Items
|
|
$
(0.18)
|
|
$
(0.37)
|
|
$
(0.54)
|
|
$
(0.83)
|
|
____________
|
|
(i)
|
Other restructuring
associated costs for the three and nine months ended
September 30, 2024 primarily relate to fees paid to
third-party consultants in support of the CTO2Grow business
transformation. Other restructuring associated costs for the three
and nine months ended September 30, 2023 primarily consists of
impairment of property and equipment and inventory obsolescence
charges related to business closure activity.
|
|
(ii)
|
Contract
terminations for the three and nine months ended September 30,
2023 primarily relates to charges associated with business closure
activity.
|
|
(iii)
|
Charges related to
acquisition and divestiture activity for the three months ended
September 30, 2024 primarily consist of Liquibox related
charges. Charges related to acquisition and divestiture activity
for the nine months ended September 30, 2024 primarily consist
of integration expenses and other Liquibox related charges,
partially offset by income recognized on the final purchase price
settlement related to the Liquibox acquisition.
|
|
(iv)
|
Other Special Items for
the three and nine months ended September 30, 2024 primarily
include fees related to professional services directly associated
with Special Items or events that are considered one-time or
infrequent. Other Special Items for the three months ended
September 30, 2023 primarily relate to a gain associated with a
legal settlement. Other Special Items for the nine months ended
September 30, 2023 primarily relate to a one-time, non-cash
cumulative translation adjustment (CTA) loss recognized due to the
wind-up of one of our legal entities, partially offset by a gain
associated with a legal settlement.
|
|
Calculation of Net
Debt
(Unaudited)
|
|
(In USD
millions)
|
|
September 30,
2024
|
|
December 31,
2023
|
|
Short-term
borrowings
|
|
$
139.7
|
|
$
140.7
|
|
Current portion of
long-term debt
|
|
58.1
|
|
35.7
|
|
Long-term debt, less
current portion
|
|
4,334.0
|
|
4,513.9
|
|
Total debt
|
|
4,531.8
|
|
4,690.3
|
|
Less: cash and cash
equivalents
|
|
(386.0)
|
|
(346.1)
|
|
Non-GAAP Net
Debt
|
|
$
4,145.8
|
|
$
4,344.2
|
|
|
|
|
|
|
Net Leverage Ratio
(Net Debt / Last Twelve Months Adjusted EBITDA)
|
|
3.7x
|
|
3.9x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Last Twelve Months
Ended
|
|
(In USD
millions)
|
|
September 30,
2024
|
|
December 31,
2023
|
|
GAAP Net earnings
from continuing operations
|
|
$
394.8
|
|
$
339.3
|
|
Interest expense,
net
|
|
255.3
|
|
263.0
|
|
Income tax
provision
|
|
95.1
|
|
90.4
|
|
Depreciation and
amortization, net of adjustments
|
|
236.7
|
|
239.6
|
|
Special
Items:
|
|
|
|
|
|
Liquibox intangible
amortization
|
|
30.7
|
|
27.9
|
|
Liquibox inventory
step-up expense
|
|
(0.6)
|
|
10.2
|
|
Restructuring
charges
|
|
31.2
|
|
15.6
|
|
Other restructuring
associated costs
|
|
22.2
|
|
34.5
|
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
20.4
|
|
23.1
|
|
Loss on debt
redemption and refinancing activities
|
|
15.1
|
|
13.2
|
|
Contract
terminations
|
|
(0.8)
|
|
14.6
|
|
Charges related to
acquisition and divestiture activity
|
|
7.0
|
|
28.3
|
|
CEO
severance
|
|
6.1
|
|
6.1
|
|
Other Special
Items
|
|
0.9
|
|
0.8
|
|
Pre-tax impact of
Special items
|
|
132.2
|
|
174.3
|
|
Non-GAAP
Consolidated Adjusted EBITDA
|
|
$
1,114.1
|
|
$
1,106.6
|
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