10.27.15
Sealed Air Corporation announced financial results for third quarter 2015.
“We are pleased with our third quarter results in light of currency headwinds and ongoing global economic uncertainties, particularly in emerging markets,” noted Jerome A. Peribere, president and CEO. “Our unwavering dedication to our customers’ success and focus on delivering high quality earnings enabled us to deliver year-over-year organic growth in sales and Adjusted EBITDA and generate solid free cash flow.
“In the third quarter, on an organic basis, net sales of $1.75 billion increased 2.7% and Adjusted EBITDA of $300 million increased 15.6%,” Peribere added. “Adjusted EBITDA margins of 17.2% expanded by 190 basis points with margin expansion across all divisions. For the full year 2015, we now estimate Net Sales of approximately $7.0 billion, Adjusted EBITDA of approximately $1.165 billion and Free Cash Flow of approximately $560 million. Given our free cash flow generation and share repurchase program, our forecast for Adjusted EPS for the full year 2015 is approximately $2.32 as compared to prior guidance of $2.24 to $2.28.”
Food Care net sales of $836 million in the third quarter decreased 15.0% as reported. Currency had a negative impact on Food Care net sales of 12.8%, or $126 million, while the divestiture had a negative impact of 5.3%, or $52 million. Net sales increased 3.1% on an organic basis, which excludes the impact of currency translation and results from the divestiture, with favorable price/mix of 2.8% on relatively flat volume.
Diversey Care net sales of $502 million in the third quarter decreased 8.9% as reported and increased 3.9% on a constant dollar basis. Product Care net sales of $385 million in the third quarter decreased 8.6% as reported and 1.7% on a constant dollar basis.
Sealed Air recently announced the acquisition of B+ Equipment, a privately held company headquartered in France, and the sale of its European trays business. B+ Equipment designs, manufactures and services automated packaging equipment for order fulfillment operations. Sealed Air also announced it had entered into an agreement to sell the European trays business to Faerch Plast A/S, a European food packaging solutions provider. This business is reported in Sealed Air’s Food Care division and generated net sales of $71 million in 2014 and $44 million in the nine months ended September 30, 2015. The transaction is expected to close in the fourth quarter of 2015.
Third quarter 2015 net sales of $1.75 billion decreased 11.6% on a reported basis and was essentially unchanged on a constant dollar basis. Currency had a negative impact on net sales of 11.7% or $230 million. Adjusting for currency translation and the divestiture, net sales increased 2.7% on an organic basis.
Adjusted EBITDA for the third quarter 2015 was $300.0 million, or 17.2% of net sales, compared to $302.3 million, or 15.3% of net sales, in third quarter 2014. Currency had a negative impact on Adjusted EBITDA of $39 million. Adjusted EBITDA margins expanded 190 basis points compared to last year. The year-over-year margin increase was primarily attributable to favorable mix and price/cost spread, cost synergies, partially offset by unfavorable currency translation and the impact of the divestiture.
Free Cash Flow, defined as net cash used in operating activities less capital expenditures, was an inflow of $331 million in the nine months ended Sept. 30, 2015, compared with $371 million in the nine months ended Sept. 30, 2014, excluding the Settlement agreement.
Compared to December 31, 2014, the Company’s net debt increased $224 million to $4.3 billion as of Septe. 30, 2015.
The company estimates net sales to be approximately $7.0 billion for the full year 2015, which assumes an unfavorable impact of approximately 10% from foreign currency translation. Excluding the impact of foreign currency translation and the impact of the divestiture, net sales are expected to increase approximately 3% on an organic basis.
Adjusted EBITDA is estimated to be approximately $1.165 billion. Free Cash Flow is expected to be approximately $560 million as compared to previously provided guidance of $585 million.
“We are pleased with our third quarter results in light of currency headwinds and ongoing global economic uncertainties, particularly in emerging markets,” noted Jerome A. Peribere, president and CEO. “Our unwavering dedication to our customers’ success and focus on delivering high quality earnings enabled us to deliver year-over-year organic growth in sales and Adjusted EBITDA and generate solid free cash flow.
“In the third quarter, on an organic basis, net sales of $1.75 billion increased 2.7% and Adjusted EBITDA of $300 million increased 15.6%,” Peribere added. “Adjusted EBITDA margins of 17.2% expanded by 190 basis points with margin expansion across all divisions. For the full year 2015, we now estimate Net Sales of approximately $7.0 billion, Adjusted EBITDA of approximately $1.165 billion and Free Cash Flow of approximately $560 million. Given our free cash flow generation and share repurchase program, our forecast for Adjusted EPS for the full year 2015 is approximately $2.32 as compared to prior guidance of $2.24 to $2.28.”
Food Care net sales of $836 million in the third quarter decreased 15.0% as reported. Currency had a negative impact on Food Care net sales of 12.8%, or $126 million, while the divestiture had a negative impact of 5.3%, or $52 million. Net sales increased 3.1% on an organic basis, which excludes the impact of currency translation and results from the divestiture, with favorable price/mix of 2.8% on relatively flat volume.
Diversey Care net sales of $502 million in the third quarter decreased 8.9% as reported and increased 3.9% on a constant dollar basis. Product Care net sales of $385 million in the third quarter decreased 8.6% as reported and 1.7% on a constant dollar basis.
Sealed Air recently announced the acquisition of B+ Equipment, a privately held company headquartered in France, and the sale of its European trays business. B+ Equipment designs, manufactures and services automated packaging equipment for order fulfillment operations. Sealed Air also announced it had entered into an agreement to sell the European trays business to Faerch Plast A/S, a European food packaging solutions provider. This business is reported in Sealed Air’s Food Care division and generated net sales of $71 million in 2014 and $44 million in the nine months ended September 30, 2015. The transaction is expected to close in the fourth quarter of 2015.
Third quarter 2015 net sales of $1.75 billion decreased 11.6% on a reported basis and was essentially unchanged on a constant dollar basis. Currency had a negative impact on net sales of 11.7% or $230 million. Adjusting for currency translation and the divestiture, net sales increased 2.7% on an organic basis.
Adjusted EBITDA for the third quarter 2015 was $300.0 million, or 17.2% of net sales, compared to $302.3 million, or 15.3% of net sales, in third quarter 2014. Currency had a negative impact on Adjusted EBITDA of $39 million. Adjusted EBITDA margins expanded 190 basis points compared to last year. The year-over-year margin increase was primarily attributable to favorable mix and price/cost spread, cost synergies, partially offset by unfavorable currency translation and the impact of the divestiture.
Free Cash Flow, defined as net cash used in operating activities less capital expenditures, was an inflow of $331 million in the nine months ended Sept. 30, 2015, compared with $371 million in the nine months ended Sept. 30, 2014, excluding the Settlement agreement.
Compared to December 31, 2014, the Company’s net debt increased $224 million to $4.3 billion as of Septe. 30, 2015.
The company estimates net sales to be approximately $7.0 billion for the full year 2015, which assumes an unfavorable impact of approximately 10% from foreign currency translation. Excluding the impact of foreign currency translation and the impact of the divestiture, net sales are expected to increase approximately 3% on an organic basis.
Adjusted EBITDA is estimated to be approximately $1.165 billion. Free Cash Flow is expected to be approximately $560 million as compared to previously provided guidance of $585 million.