Graphic Packaging Reports 2Q 2023 Financial Results

Graphic Packaging Holding Company, a leading fiber-based consumer packaging company, reported results for the second quarter of 2023.

Net sales increased 1% to $2,392 million in the second quarter of 2023, compared to $2,358 million in the prior year period. The $34 million increase was driven by $188 million of positive pricing, partially offset by $154 million of unfavorable volume/mix.

EBITDA for the second quarter of 2023 was $434 million, $140 million higher than the second quarter of 2022.  After adjusting both periods for business combinations and other special charges, adjusted EBITDA was $453 million in the second quarter of 2023 versus $396 million in the second quarter of 2022. 

Net income for second quarter 2023 was $150 million, or $0.49 per share, based upon 309.1 million weighted average diluted shares. This compares to second quarter 2022 net income of $66 million, or $0.21 per share, based upon 309.9 million weighted average diluted shares.

When adjusting for special charges and amortization of purchased intangibles, adjusted net income for the second quarter of 2023 was $203 million, or $0.66 per diluted share. This compares to second quarter 2022 adjusted net income of $185 million, or $0.60 per diluted share.

“We grew sales, adjusted EBITDA and adjusted EBITDA margins year over year in the second quarter while actively managing supply to meet demand in response to short-term inventory destocking by retailers and our customers,” said Michael Doss, the company’s president and CEO. “Importantly, our global team continued to advance key initiatives to drive sustained future organic growth and higher profitability through commercial execution, quality improvement and cost reduction. Our focus remains on delivering renewable and recyclable, fiber-based packaging solutions preferred by consumers.

“Consistent with that, we are pleased to announce a definitive agreement to acquire Bell Incorporated, a well-capitalized U.S. packaging provider, strategically expanding our network, customer breadth and category presence,” Doss added. “The pending transaction will strengthen our integrated packaging network in the U.S., further solidifying our commitment to deliver service excellence in packaging. Finally, we are reiterating full year 2023 guidance.

Bell Incorporated Acquisition

The company has entered into a definitive agreement to acquire Bell Incorporated. The proposed acquisition is expected to add approximately $200 million in sales, $30 million in adjusted EBITDA and will support strategic priorities of increasing integration rates and expanding customers and categories. Annual synergies of approximately $10 million are expected within 24 months of closing.

The transaction includes three well-capitalized packaging facilities in the Midwest that consume 95,000 tons of paperboard annually.

The transaction is expected to close in the fourth quarter of 2023, subject to regulatory approvals and other customary closing conditions.