Greif(GEF_B) - 2024 Q3 - Quarterly Report

Financial Performance - Net sales for the three months ended July 31, 2024, increased to $1,454.2 million, up 9.3$1,330.3 million in the same period of 2023[4]. - Gross profit for the nine months ended July 31, 2024, was $782.1 million, a decrease of 10.1$870.4 million for the same period in 2023[4]. - Operating profit for the three months ended July 31, 2024, was $171.0 million, an increase of 9.3$155.6 million in the prior year[4]. - Net income attributable to Greif, Inc. for the three months ended July 31, 2024, was $87.1 million, down from$90.3 million in the same period of 2023[4]. - Basic earnings per share for Class A common stock decreased to $1.51 for the three months ended July 31, 2024, from$1.57 in the prior year[4]. - The company reported comprehensive income of $80.2 million for the three months ended July 31, 2024, down from$108.2 million in the same period of 2023[6]. - Net income for the nine months ended July 31, 2024, was $219.9 million, a decrease of 28.1$305.8 million for the same period in 2023[14]. - The company reported a total operating profit of $171.0 million for the three months ended July 31, 2024, compared to$155.6 million for the same period in 2023, marking a 9.2% increase[105]. - The total pro forma net income attributable to Greif, Inc. for the nine months ended July 31, 2024, was $224.3 million, down from$289.2 million in the same period of 2023[32]. Assets and Liabilities - Cash and cash equivalents increased to $194.2 million as of July 31, 2024, compared to$180.9 million at the end of October 2023[9]. - Trade accounts receivable rose to $785.7 million as of July 31, 2024, up from$659.4 million at the end of October 2023[9]. - Total assets increased to $6,834.9 million as of July 31, 2024, compared to$5,960.8 million at the end of October 2023[9]. - Current liabilities increased to $1,010.2 million as of July 31, 2024, up from$939.3 million on October 31, 2023, reflecting a rise of 7.6%[12]. - Long-term debt rose significantly to $2,793.4 million as of July 31, 2024, compared to$2,121.4 million on October 31, 2023, marking an increase of 31.7%[12]. - Total shareholders' equity increased to $2,099.6 million as of July 31, 2024, up from$1,986.3 million on October 31, 2023, representing a growth of 5.7%[12]. - The company’s retained earnings increased to $2,449.0 million as of July 31, 2024, up from$2,337.9 million on October 31, 2023, reflecting a growth of 4.8%[12]. Cash Flow and Investments - Cash flows from operating activities provided $168.8 million, a decline of 62.2$446.0 million in the prior year[14]. - Net cash used in investing activities was $703.8 million, an increase of 41.8$496.7 million in the previous year[14]. - The company reported a net cash provided by financing activities of $541.7 million, a significant increase from$62.0 million in the previous year[14]. - The company invested $141.4 million in capital expenditures during the first nine months of 2024, compared to$136.4 million in 2023[173]. Acquisitions and Divestitures - The company completed the acquisition of Ipackchem Group SAS on March 26, 2024, for a total purchase price of $582.1 million, with transaction costs of$8.9 million incurred[24]. - Goodwill recognized from the Ipackchem acquisition amounted to $275.4 million, attributed to expected synergies and economies of scale[24]. - The company completed the acquisition of Centurion Container LLC on March 31, 2023, for a total purchase price of$144.5 million[39]. - The company recognized a gain of $9.8 million from the acquisition of Centurion, with a fair value of the previously held interest valued at$16.8 million[40]. - The Delta Divestiture generated net sales proceeds of $91.2 million and resulted in a gain of$46.1 million on the sale of business[52]. - The Tama Divestiture resulted in net cash proceeds of $100.2 million and a gain of$54.6 million on the sale of business[53]. Segment Performance - The Global Industrial Packaging segment reported net sales of $846.0 million in Q3 2024, up from$761.8 million in Q3 2023, with an operating profit of $131.8 million compared to$102.0 million[139]. - The Paper Packaging & Services segment reported net sales of $603.6 million, up from$563.9 million, marking a 7.9% increase[129]. - Operating profit for the Global Industrial Packaging segment was $131.8 million for the three months ended July 31, 2024, compared to$102.0 million in the same period of 2023, representing a 29.1% increase[105]. - The Paper Packaging & Services segment's net sales increased to $603.6 million in Q3 2024 from$563.9 million in Q3 2023, but operating profit decreased to $37.5 million from$52.1 million[142][143]. Expenses and Profit Margins - Gross profit decreased to $290.4 million in Q3 2024 from$307.0 million in Q3 2023, with a gross profit margin of 20.0% compared to 23.1% in the prior year[135]. - SG&A expenses rose to $164.0 million in Q3 2024 from$135.7 million in Q3 2023, representing 11.3% of net sales compared to 10.2% in the previous year[136]. - Adjusted EBITDA decreased to $193.7 million from$226.5 million, a decline of 14.5% year-over-year[129]. - Operating profit for the first nine months of 2024 was $338.0 million, down from$493.1 million in the same period of 2023[162]. Tax and Compliance - For the nine months ended July 31, 2024, the Company recorded income tax expense of $15.0 million, a decrease of$92.9 million from $107.9 million for the same period in 2023[84]. - The company was in compliance with all covenants under the 2023 Credit Agreement and the U.S. RFA as of July 31, 2024[185][187]. Risks and Future Outlook - The company faces various risks including economic conditions, supply chain disruptions, and competitive pressures that could impact future performance[114]. - The company anticipates mixed demand trends to continue through the fiscal year end, with stable costs for key materials expected[137].