10.26.16
Graphic Packaging Holding Company reported net income for third quarter 2016 of $57.8 million, or $0.18 per share, based upon 320.4 million weighted average diluted shares. This compares to third quarter 2015 net income of $60.2 million, or $0.18 per share, based on 330.4 million weighted average diluted shares.
Third quarter 2016 net income was negatively impacted by $6.2 million (net of a $2.7 million tax benefit) of business combinations and other special charges. When adjusting for these charges, adjusted net income for the third quarter of 2016 was $64.0 million, or $0.20 per diluted share. This compares to third quarter 2015 adjusted net income of $66.0 million or $0.20 per diluted share.
“Our third quarter Adjusted EBITDA was only modestly above the prior year period as packaged food volume softened during the quarter and we incurred operating costs associated with transferring volume to lower cost converting facilities and on-boarding new business,” said president and CEO Michael Doss. “Net sales were up 3.1% driven by acquisitions, while volume in our core business was down 1.4% driven by packaged food softness. Adjusted EBITDA was $200.1 million, up 1.5% compared to the prior year period of $197.1 million.
“Free cash flow generation in the business remains strong,” added Doss. “Our focus on growing free cash flow and returning more of it to shareholders over time has not changed. We are pleased to announce that our Board of Directors has declared a 50% increase in our quarterly dividend to $0.075 per share. This material increase in the quarterly dividend demonstrates the confidence we have in our free cash flow profile. We remain committed to a balanced capital allocation strategy, which includes reinvesting in our business to drive strong cash returns on cash invested, strategic acquisitions at compelling post-synergy multiples, and returning cash to shareholders through dividends and share repurchases.”
The first increased cash dividend of $0.075 per share is payable Jan. 5, 2017 to stockholders of record on Dec. 15, 2016.
Net sales increased 3.1% to $1,103.7 million in the third quarter of 2016, compared to $1,070.0 million in the prior year period. The $33.7 million increase was driven by $51.3 million of improved volume/mix related to acquisitions. The net sales increase was partially offset by $11.5 million of unfavorable foreign exchange rates and $6.1 million of lower pricing.
EBITDA for third quarter of 2016 was $191.2 million, or $2.1 million higher than the third quarter of 2015. After adjusting both periods for business combinations and other special charges, Adjusted EBITDA increased 1.5% to $200.1 million in the third quarter of 2016 from $197.1 million in the third quarter of 2015. When comparing against the prior year quarter, Adjusted EBITDA in the third quarter of 2016 was positively impacted by $14.4 million of improved net operating performance and $2.7 million of favorable volume/mix. Total net debt decreased $22.2 million during the third quarter of 2016 to $2,226.1 million.
Third quarter 2016 net income was negatively impacted by $6.2 million (net of a $2.7 million tax benefit) of business combinations and other special charges. When adjusting for these charges, adjusted net income for the third quarter of 2016 was $64.0 million, or $0.20 per diluted share. This compares to third quarter 2015 adjusted net income of $66.0 million or $0.20 per diluted share.
“Our third quarter Adjusted EBITDA was only modestly above the prior year period as packaged food volume softened during the quarter and we incurred operating costs associated with transferring volume to lower cost converting facilities and on-boarding new business,” said president and CEO Michael Doss. “Net sales were up 3.1% driven by acquisitions, while volume in our core business was down 1.4% driven by packaged food softness. Adjusted EBITDA was $200.1 million, up 1.5% compared to the prior year period of $197.1 million.
“Free cash flow generation in the business remains strong,” added Doss. “Our focus on growing free cash flow and returning more of it to shareholders over time has not changed. We are pleased to announce that our Board of Directors has declared a 50% increase in our quarterly dividend to $0.075 per share. This material increase in the quarterly dividend demonstrates the confidence we have in our free cash flow profile. We remain committed to a balanced capital allocation strategy, which includes reinvesting in our business to drive strong cash returns on cash invested, strategic acquisitions at compelling post-synergy multiples, and returning cash to shareholders through dividends and share repurchases.”
The first increased cash dividend of $0.075 per share is payable Jan. 5, 2017 to stockholders of record on Dec. 15, 2016.
Net sales increased 3.1% to $1,103.7 million in the third quarter of 2016, compared to $1,070.0 million in the prior year period. The $33.7 million increase was driven by $51.3 million of improved volume/mix related to acquisitions. The net sales increase was partially offset by $11.5 million of unfavorable foreign exchange rates and $6.1 million of lower pricing.
EBITDA for third quarter of 2016 was $191.2 million, or $2.1 million higher than the third quarter of 2015. After adjusting both periods for business combinations and other special charges, Adjusted EBITDA increased 1.5% to $200.1 million in the third quarter of 2016 from $197.1 million in the third quarter of 2015. When comparing against the prior year quarter, Adjusted EBITDA in the third quarter of 2016 was positively impacted by $14.4 million of improved net operating performance and $2.7 million of favorable volume/mix. Total net debt decreased $22.2 million during the third quarter of 2016 to $2,226.1 million.