Financial Performance - Net Sales for Q1 2025 decreased by $139 million or 6% to $2,120 million from $2,259 million in Q1 2024, primarily due to the Augusta divestiture and reduced paperboard volumes and pricing [122]. - Income from Operations for Q1 2025 decreased by $57 million or 21% to $221 million from $278 million in Q1 2024, attributed to the Augusta divestiture, pricing declines, and commodity inflation [123]. - The Americas Paperboard Packaging segment reported net sales of $1,476 million in Q1 2025, down from $1,531 million in Q1 2024 [132]. - The International Paperboard Packaging segment's net sales decreased slightly to $523 million in Q1 2025 from $525 million in Q1 2024 [132]. - Net sales for the three months ended March 31, 2025, were $1,636 million, with a net income of $106 million [144]. Cash Flow and Liquidity - Net Cash used in Operating Activities for Q1 2025 totaled $174 million compared to $3 million provided in Q1 2024, mainly due to lower income from operations and higher working capital needs [139]. - Net cash provided by financing activities for Q1 2025 was $439 million, up from $287 million in Q1 2024 [141]. - The Company expects its primary sources of liquidity to be cash flows from sales and operating activities, along with availability from revolving credit facilities [145]. - The Company expects ongoing cash requirements to be funded for at least the next twelve months through its current liquidity sources [145]. - The Company sold receivables of $262 million and $250 million under supply chain financing arrangements for Q1 2025 and Q1 2024, respectively [149]. Capital Expenditures and Investments - Capital spending for Q1 2025 was $313 million, driven by the construction of a new recycled paperboard manufacturing facility in Waco, Texas [140]. - The Company completed the sale of its Augusta, Georgia bleached paperboard manufacturing facility for a total consideration of $711 million on May 1, 2024 [120]. - The Company plans to close the Middletown, Ohio, recycled paperboard manufacturing facility by June 1, 2025 [120]. Debt and Financial Ratios - Interest Expense, Net decreased to $51 million in Q1 2025 from $59 million in Q1 2024, due to an increase in capitalized interest [124]. - The Company maintained a maximum Consolidated Total Leverage Ratio of 3.30 to 1.00 as of March 31, 2025, below the required limit of 4.25 to 1.00 [152]. - The Company was in compliance with a minimum Consolidated Interest Expense Ratio of 7.20 to 1.00, exceeding the required minimum of 3.00 to 1.00 [153]. Goodwill and Asset Valuation - Goodwill for the Europe reporting unit was $492 million as of March 31, 2025, with a fair value exceeding its carrying value by 24% [158]. Innovation and Growth - Innovation sales growth was $44 million in Q1 2025, driven by sustainable consumer packaging solutions [122]. Interest Rate Management - The Company has no active interest rate swap agreements as of March 31, 2025, despite previous use to manage interest rate exposure [162].

Financial Data and Key Metrics Changes - In Q1 2025, Graphic Packaging reported sales of $2.1 billion, adjusted EBITDA of $365 million, and margins of 17.2%, which were significantly below expectations due to weaker volumes and input cost inflation [7][30][31] - Adjusted EPS for the quarter was $0.51, reflecting the challenging operating environment [7] Business Line Data and Key Metrics Changes - The Americas business experienced a volume decline of approximately 1%, while the international business saw a growth of about 3% [10][30] - Innovation sales growth was reported at $44 million for the quarter, indicating a positive contribution from new product categories [13] Market Data and Key Metrics Changes - Overall sales were flat year-over-year, with food representing approximately 38% of packaging sales, showing uneven results across product categories [17] - Beverage packaging sales, which account for about 25% of overall sales, saw a decline after two years of strong performance, attributed to slowing beer consumption trends [19] Company Strategy and Development Direction - The company is transitioning from Vision 2025 to Vision 2030, focusing on reinvestment and returning capital to shareholders, with a new $1.5 billion share repurchase authorization approved by the Board [9][36] - The Waco recycled paperboard investment is on track for a fourth-quarter startup, expected to generate substantial cash flow in the coming years [8][36] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer confidence has significantly declined in the U.S. and other markets, leading to a stretched consumer base and reduced spending [10][24] - The company has adjusted its guidance for 2025, now expecting a volume decline of 2% as a base case, reflecting the challenging backdrop for CPG and QSR customers [34][35] Other Important Information - Input cost inflation was significant in Q1 2025, with expectations for continued inflation in the coming quarters [31][34] - The company plans to implement a $40 price increase on recycled and unbleached paperboard grades effective May 15, 2025, to help recover margins [11][31] Q&A Session Summary Question: Trends in volume and affordability issues - Management acknowledged that affordability is a key issue affecting volumes, with consumers buying fewer items due to economic pressures [46][48] Question: Guidance assumptions for price-cost dynamics - The company expects to see a positive price contribution late in 2025, with efforts to recover inflation costs rolling into 2026 [52][95] Question: Supply-demand balance and potential industry actions - Management indicated that they will take rolling market-related downtime to align supply with demand, and noted recent closures by competitors that could help balance the market [58][60] Question: Revised guidance implications - The lower guidance reflects a combination of inflation impacts and volume declines, with a focus on matching supply and demand [84][92] Question: Long-term cash flow trajectory - Management remains confident in the long-term cash flow trajectory, expecting a significant reduction in CapEx in the coming years [100]

Financial Data and Key Metrics Changes - In Q1 2025, Graphic Packaging reported sales of $2.1 billion, adjusted EBITDA of $365 million, and margins of 17.2%, with adjusted EPS at $0.51, all significantly below expectations due to weaker volumes and input cost inflation [5][27][28] - Adjusted EBITDA was impacted by a $34 million headwind from price, volume, and mix, while input cost inflation amounted to $21 million [29] Business Line Data and Key Metrics Changes - The Americas business experienced a volume decline of approximately 1%, while the non-integrated international business saw a volume increase of about 3% [27] - Innovation sales growth was reported at $44 million for the quarter, driven by new contributions in various product categories [11] Market Data and Key Metrics Changes - Volumes in the Americas were disappointing, down about 1%, while international markets showed slight growth but began to pull back due to economic uncertainty [8][9] - The food market represented approximately 38% of packaging sales, with mixed results across product categories, while beverage sales, accounting for about 25% of overall packaging sales, saw its first decline after two years of strong performance [14][16] Company Strategy and Development Direction - The company is transitioning from Vision 2025 to Vision 2030, focusing on reinvestment and returning capital to stockholders, with a new $1.5 billion share repurchase authorization approved by the Board [7][34] - The Waco recycled paperboard investment is on track for a fourth-quarter startup, with expectations of generating substantial excess cash over the next several years [5][8] Management Comments on Operating Environment and Future Outlook - Management noted that consumer confidence has significantly declined, impacting volumes across markets, and a 2% volume decline is now the base case for 2025 [22][32] - Input cost inflation is expected to continue, with price increases announced to help recover margins [29][30] Other Important Information - The company plans to maintain capital spending in the $700 million range for 2025, with expectations of generating innovation sales growth of at least 2% [33][34] - The company is committed to improving its environmental footprint and enhancing its competitive advantage through innovation [25] Q&A Session Summary Question: Trends in volume decline and affordability issues - Management acknowledged that affordability is a key factor affecting volumes, with customers experiencing volume declines of approximately 3% to 4% [45][46] Question: Guidance assumptions for price-cost dynamics - Management expects to see a positive price contribution late in 2025, with efforts to recover inflation through pricing actions [52][53] Question: Supply-demand balance and potential industry actions - Management indicated that they will take rolling market-related downtime to match supply with demand, and noted recent closures by competitors that could help balance the market [61][62] Question: Revised guidance and EBITDA margin expectations - Management clarified that the revised guidance reflects a temporary impact from inflation, with a path back to previous margin levels expected through pricing recovery and the Waco project [94][95]

Graphic Packaging (GPK) came out with quarterly earnings of $0.51 per share, missing the Zacks Consensus Estimate of $0.56 per share. This compares to earnings of $0.66 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -8.93%. A quarter ago, it was expected that this packaging company would post earnings of $0.63 per share when it actually produced earnings of $0.59, delivering a surprise of -6.35%.Over the last four quarters, t ...

Graphic Packaging Holding Company Reports First Quarter 2025 Financial Results Highlights ATLANTA, May 1, 2025 - Graphic Packaging Holding Company (NYSE: GPK) ("Graphic Packaging" or the "Company"), a global leader in sustainable consumer packaging, today reported first quarter 2025 results. Net Income in first quarter 2025 was $127 million, or $0.42 per diluted share, versus $165 million, or $0.53 per diluted share in first quarter 2024. First quarter 2025 and 2024 Net Income was impacted by special items ...

Financial Performance & Guidance - Net sales for Q1 2025 were $2.12 billion, a decrease of 6% year-over-year compared to $2.259 billion in Q1 2024[39] - Adjusted EBITDA for Q1 2025 was $365 million, down from $443 million in Q1 2024, with Adjusted EBITDA Margin decreasing by 240bps to 172%[39] - Adjusted EPS for Q1 2025 was $051, compared to $066 in Q1 2024[39] - The company revised its 2025 Net Sales guidance to $82 billion to $85 billion and Adjusted EBITDA guidance to $14 billion to $16 billion[44] - Capital spending for 2025 is projected to be approximately $700 million[46, 53] Strategic Initiatives & Market Dynamics - Volume increased by 1% year-over-year, with America's down 1% and International up 3%, while price decreased by 1% year-over-year[5] - Innovation Sales Growth reached $44 million in Q1 2025, with a solid pipeline visibility to at least 2% Innovation Sales Growth in 2025[5] - The company announced a new $15 billion share repurchase authorization, bringing the total available authorization to $1865 billion[5] - The Waco, Texas recycled paperboard investment is moving toward completion with a Q4 2025 startup, while the Middletown, Ohio facility closure was announced[5] Future Outlook - The company aims for low-single-digit annual sales growth, mid-single-digit annual Adjusted EBITDA growth, and high-single-digit annual Adjusted EPS growth[47] - Graphic Packaging anticipates generating over $5 billion in cash flow between 2024 and 2030, with approximately $800 million to $1 billion in cash flow expected in 2025[49]

Core Viewpoint - Graphic Packaging Holding Company reported a decline in net income and sales for the first quarter of 2025, attributing the results to a challenging economic environment and increased input costs [2][3][5]. Financial Performance - Net income for Q1 2025 was $127 million, or $0.42 per diluted share, down from $165 million, or $0.53 per diluted share in Q1 2024 [2][24]. - Adjusted net income for Q1 2025 was $154 million, or $0.51 per diluted share, compared to $203 million, or $0.66 per diluted share in Q1 2024 [2][26]. - Net sales decreased by 6% to $2,120 million in Q1 2025 from $2,259 million in Q1 2024, influenced by divestitures and unfavorable foreign exchange impacts [5][16]. Operational Insights - EBITDA for Q1 2025 decreased by 17% to $353 million, with adjusted EBITDA at $365 million, down from $443 million in the same quarter last year [6][24]. - The adjusted EBITDA margin was 17.2% in Q1 2025, compared to 19.6% in Q1 2024 [6][24]. Debt and Capital Management - Total debt increased by $526 million to $5,735 million in Q1 2025, with net debt rising to $5,606 million [7][25]. - The net leverage ratio was 3.5x in Q1 2025, up from 3.0x in Q4 2024 [7][25]. - Capital expenditures for Q1 2025 were $313 million, slightly down from $331 million in the same quarter last year [8][11]. Future Guidance - The company expects full-year 2025 net sales between $8.2 billion and $8.5 billion, adjusted EBITDA between $1.4 billion and $1.6 billion, and adjusted EPS between $1.75 and $2.25 [9][10]. - The guidance reflects anticipated volume declines and input cost inflation, with increased uncertainty in macroeconomic conditions [9][10]. Strategic Initiatives - The company announced a new $1.5 billion share repurchase authorization, increasing the total available authorization to $1.865 billion [4][10]. - A ten percent increase in the quarterly dividend was announced in February 2025 [4].

Core Viewpoint - Graphic Packaging Holding Company has announced a new $1.5 billion share repurchase authorization, increasing the total available authorization to $1.865 billion as of April 30, 2025 [1][2]. Group 1: Share Repurchase Authorization - The new authorization allows for share repurchases through open market transactions, privately negotiated deals, and Rule 10b5-1 plans, depending on market conditions and the company's financial status [2]. - The previous share repurchase authorization from July 27, 2023, had $365 million remaining, which is now combined with the new authorization [1]. Group 2: Financial Strategy and Dividend - The company's President and CEO, Michael Doss, indicated that capital spending needs will decline significantly as the Vision 2025 investment nears completion, allowing for excess cash generation [3]. - The Board of Directors has approved a 10% increase in the quarterly dividend to $0.11 per share, which was paid on April 5, 2025, to stockholders of record as of March 15, 2025 [3]. Group 3: Commitment to Shareholder Returns - The company plans to measure potential investments against the alternative of repurchasing stock and aims to return a substantial amount of cash to shareholders through dividends and share repurchases in the future [4].

Core Viewpoint - Purcell & Lefkowitz LLP is investigating Graphic Packaging Holding Company to determine if its directors breached fiduciary duties related to recent corporate actions [1]. Group 1 - The investigation is being conducted on behalf of the shareholders of Graphic Packaging Holding Company [1]. - Shareholders interested in more information regarding their rights and options can contact Purcell & Lefkowitz LLP for free [2]. - Purcell & Lefkowitz LLP specializes in representing shareholders affected by securities fraud and corporate misconduct [3].

Core Viewpoint - Graphic Packaging Holding Company will permanently close its Middletown, Ohio, coated recycled paperboard manufacturing facility around June 1, 2025, as part of a strategy to consolidate production into its Kalamazoo, Michigan, and Waco, Texas facilities, impacting approximately 130 employees [1][2]. Group 1 - The closure is aimed at enhancing the company's competitive advantage in paperboard manufacturing while improving environmental efficiency, including water and energy usage [2][3]. - The investments in Kalamazoo and Waco are critical for delivering high-quality, economically advantageous paperboard in North America, with the Waco facility nearing completion [3]. Group 2 - Graphic Packaging is recognized as a global leader in sustainable consumer packaging, focusing on reducing the environmental footprint through the use of renewable and recycled materials [5]. - The company operates a global network of design and manufacturing facilities, serving well-known brands across various sectors, including food and beverage [5].