Graphic Packaging Reports 2Q 2024 Financial Results

Graphic Packaging Holding Company reported second quarter 2024 results.

Net sales decreased 6% or $155 million to $2,237 million in the second quarter of 2024, compared to $2,392 million in the prior year period. The decline was driven by the divestiture of the Augusta, GA bleached paperboard manufacturing facility and reduced open market sales participation of $83 million and a net decline in sales from packaging operations of $73 million, primarily price and mix.

Net income was $190 million, versus $150 million in 2023. EBITDA for the second quarter of 2024 was $458 million, $24 million higher than the second quarter of 2023. After adjusting both periods for business combinations and other special items, adjusted EBITDA was $402 million in the second quarter of 2024 versus $453 million in the second quarter of 2023.

“Second quarter played out largely as expected, with continued strength in Foodservice and Beverage results, and strong execution driving solid adjusted EBITDA,” said Michael Doss, the company’s president and CEO. “Consumers are responding to higher prices by shifting their purchasing patterns, and our portfolio, designed to move with the consumer, is doing just that. Graphic Packaging’s innovation leadership was on full display in the quarter with a big win for Paperseal Shape at one of the UK’s largest food retailers. We are delivering the sustainable packaging solutions consumers prefer and are on track to reach $200 million in Innovation Sales Growth during 2024.

“On May 1st, we divested the Augusta bleached paperboard manufacturing facility, eliminating most of our open market bleached paperboard sales and removing a significant source of earnings volatility,” added Doss. “We used a portion of the proceeds to repurchase approximately 2.4% of our outstanding common shares and will continue to return substantial cash to stockholders through dividends and share repurchase over the next several years as sales and cash flow grow.”

Total debt decreased $250 million to $5,285 million, and net debt decreased $250 million to $5,160 million, compared to the prior year second quarter. The company’s second quarter 2024 net leverage ratio was 2.9x compared to 3.0x in the prior year quarter.

The divestiture of the company’s Augusta, GA bleached paperboard manufacturing facility was completed on May 1, 2024.