Greif(GEF_B) - 2024 Q3 - Quarterly Results

Financial Performance - Net income for fiscal Q3 2024 decreased by 3.5% to $87.1 million, or$1.50 per diluted Class A share, compared to $90.3 million, or$1.55 per diluted Class A share in Q3 2023[3] - Adjusted EBITDA decreased by 14.5% to $193.7 million from$226.5 million in the prior year[3] - Net income for the three months ended July 31, 2024, was $93.6 million, a decrease of 3.2$96.7 million for the same period in 2023[22] - Net income attributable to Greif, Inc. for the three months ended July 31, 2024, was $87.1 million, a decrease of 3.5$90.3 million in the prior year[20] - Basic earnings per share attributable to Greif, Inc. common shareholders for Class A stock was $1.51, down from$1.57 in the same period last year[20] - Adjusted EBITDA for the three months ended July 31, 2024, was $193.7 million, down 14.4$226.5 million in the same period of 2023[24] - Free cash flow for the three months ended July 31, 2024, was $32.0 million, significantly lower than$157.0 million in the same period of 2023[26] - Adjusted free cash flow for the three months ended July 31, 2024, was $34.3 million, compared to$167.1 million in the same period of 2023[26] Sales and Revenue - Net sales for the three months ended July 31, 2024, were $1,454.2 million, an increase of 9.3$1,330.3 million for the same period in 2023[20] - Net sales in Global Industrial Packaging increased by $84.2 million to$846.0 million, driven by higher selling prices and volumes[8] - Net sales in Paper Packaging & Services rose by $39.7 million to$603.6 million, primarily due to higher average selling prices and volumes[10] - Total net sales for the three months ended July 31, 2024, reached $1,454.2 million, an increase of 9.3$1,330.3 million in the prior year[23] Profitability - Gross profit for the three months ended July 31, 2024, was $290.4 million, a decrease of 5.4$307.0 million in the prior year[20] - Operating profit for the three months ended July 31, 2024, was $171.0 million, up 9.3$155.6 million in the same period last year[20] - The company reported a total gross profit margin of 19.9% for the three months ended July 31, 2024, compared to 23.1% in the same quarter of 2023[23] - Operating profit in the Global Industrial Packaging segment for the three months ended July 31, 2024, was $131.8 million, an increase of 29.4$102.0 million in the same period of 2023[25] - The Paper Packaging & Services segment's operating profit for the three months ended July 31, 2024, was $37.5 million, down from$52.1 million in the same period of 2023[25] Debt and Equity - Total debt increased by $738.0 million to$2,909.5 million, with net debt rising by $701.5 million to$2,715.3 million, resulting in a leverage ratio of 3.66x[3] - Long-term debt increased to $2,793.4 million as of July 31, 2024, from$2,121.4 million as of October 31, 2023[21] - Total equity for Greif, Inc. increased to $2,056.9 million as of July 31, 2024, compared to$1,947.9 million as of October 31, 2023[21] - The company’s net debt as of July 31, 2024, was $2,715.3 million, compared to$2,720.1 million as of April 30, 2024, and $2,013.8 million as of July 31, 2023[28] - The leverage ratio as of July 31, 2024, was 3.59x, compared to 3.44x for the trailing twelve months ended April 30, 2024, and 2.17x for the trailing twelve months ended July 31, 2023[29] Cash Flow - Cash provided by operating activities for the three months ended July 31, 2024, was$76.8 million, a decrease of 62.0% from $202.3 million in the same period last year[22] - Cash used in investing activities for the three months ended July 31, 2024, was$(41.2) million, compared to $(45.7) million in the same quarter of 2023[22] - Cash used in financing activities for the three months ended July 31, 2024, was$(43.2) million, a decrease from $(153.6) million in the same period last year[22] - The company’s cash and cash equivalents at the end of the period were$194.2 million, an increase from $157.7 million at the end of the same period last year[22] Future Outlook - Fiscal 2024 adjusted EBITDA outlook is projected between$675 million and $725 million, with adjusted free cash flow expected between$175 million and $225 million[14] - Fiscal 2024 guidance for net cash provided by operating activities is projected between$322.0 million and $388.0 million[30] - Free cash flow is expected to range from$144.0 million to $188.0 million[30] - Adjusted free cash flow is projected to be between$175.0 million and $225.0 million[30] - Cash paid for acquisitions and integration-related costs is estimated at$26.8 million to $30.8 million[30] - The company anticipates capital expenditures for properties, plants, and equipment to be between$178.0 million and $200.0 million[30] Risks and Challenges - The company faces various risks including economic conditions, competitive pressures, and potential disruptions in the supply chain[18]