Reaffirms 2024 Full Year Outlook
Net sales of $1.33 billion,
down 1% as reported and constant currency
Volumes flat compared to the prior year
Net earnings of $83
million, up 33%
Adjusted EBITDA of $278 million,
up 4%
Earnings per share (Diluted) of $0.57, up 30%
Adjusted EPS (Diluted) of $0.78,
up 5%
Cash flow from operations (YTD) of $125 million, up 141%
Free cash flow (YTD) of $78
million versus ($13) million
in the prior year
CHARLOTTE, N.C., May 2, 2024
/PRNewswire/ -- SEE (NYSE: SEE) announced financial results for Q1
2024.
"Our first quarter results were ahead of our expectations,
reflecting stronger than expected demand within Food, continued
volume stabilization within Protective and accelerated savings from
our CTO2Grow program. Our recent commercial reorganization is
beginning to take hold with improved execution in the marketplace,"
said Emile Chammas, SEE's Interim
Co-CEO and COO.
"We delivered another quarter of strong free cash flow
generation, reflecting the strength of our underlying operating
model and continued working capital improvements.
We are excited about our future and remain committed to
transforming SEE, restoring underlying fundamentals and driving
long-term value creation for our shareholders," said Dustin Semach, SEE's Interim Co-CEO and CFO.
Business Segment Highlights
First quarter net sales in Food were $868 million, an increase of 2% as reported.
Currency fluctuations had an unfavorable impact of less than
$1 million. On a constant dollar
basis, net sales increased $16
million, or 2%. Volumes increased $25
million, or 3%, driven by strong demand for bags, case ready
and automated solutions. Liquibox also had a favorable impact of
$23 million, or 3%, from the
additional month of contributions in 2024. Price had an unfavorable
impact of $33 million, or 4%.
Adjusted EBITDA of $190 million, or
21.8% of net sales, decreased 3% from $195
million, or 22.8% of net sales. The decrease in Adjusted
EBITDA was primarily attributable to unfavorable net price
realization, partially offset by higher volumes.
First quarter net sales in Protective were $461 million, a decrease of 7% as reported.
Currency fluctuations had an unfavorable impact of $1 million. On a constant dollar basis, net sales
decreased $33 million, or 7%. Volumes
decreased $19 million, or 4%,
resulting from end-market softness, primarily in EMEA. Price had an
unfavorable impact of $15 million, or
3%. Adjusted EBITDA increased 11% to $90
million, or 19.4% of net sales, as compared to $80 million, or 16.2% of net sales. The increase
in Adjusted EBITDA was primarily attributable to lower operating
costs, partially offset by unfavorable net price realization and
lower volumes.
First Quarter 2024 U.S. GAAP Summary
Net sales of $1.33 billion
decreased 1% as reported, with EMEA decreasing 6%, APAC decreasing
3% and the Americas up less than 1%.
Net earnings were $83 million, or
$0.57 per diluted share, as compared
to net earnings of $63 million, or
$0.44 per diluted share. The current
year results were impacted by $29
million of Special Items expense, including $22 million of restructuring and other associated
costs related to the cost take-out to grow program ("CTO2Grow
Program"). The prior year results were impacted by $44 million of Special Items expense,
$30 million of which related to the
Liquibox acquisition.
Income tax expense was $36
million, resulting in an effective tax rate of 30.0% in the
quarter. This compares to an income tax expense of $34 million in the prior year period, or an
effective tax rate of 35.0%. The lower effective tax rate is
primarily driven by lower accruals for uncertain tax positions in
the current year.
First Quarter 2024 Non-U.S. GAAP Summary
Net sales decreased $18 million,
or 1%, on a constant dollar basis. Price had an unfavorable impact
of $47 million, or 4%. The Liquibox
acquisition had a favorable impact of $23
million, or 2%. Volumes increased by $6 million, or less than 1%.
Adjusted EBITDA was $278 million,
or 20.9% of net sales, as compared to $267
million, or 19.8% in the prior year. The increase in
Adjusted EBITDA was primarily due to productivity benefits as a
result of the CTO2Grow Program and cost control initiatives,
partially offset by unfavorable net price realization.
The Adjusted Tax Rate was 25.9% in first quarter 2024, as
compared to 24.0% in the prior year. The current year Adjusted Tax
Rate was negatively impacted by share-based compensation while the
prior year Adjusted Tax Rate was positively impacted by the same
item.
Adjusted earnings per diluted share increased to $0.78, from $0.74
in the prior year period, primarily due to higher Adjusted EBITDA
and lower depreciation and amortization, partially offset by higher
interest expense.
Cash Flow and Net Debt
Cash flow from operating activities during the first three
months of 2024 was a source of $125
million, as compared to a source of $52 million during the prior year period, up
141%.
Capital expenditures in the first three months of 2024 were
$47 million, as compared to
$65 million during the prior year
period. Free Cash Flow, defined as net cash from operating
activities less capital expenditures, was a source of $78 million for the first three months of 2024,
as compared to a use of $13 million
during the prior year period.
Dividend payments for the first three months of both 2024 and
2023 were approximately $31
million.
Total debt was $4.7 billion as of
March 31, 2024 and December 31, 2023. Net Debt, defined
as total debt less cash and cash equivalents, was $4.3 billion as of March 31, 2024 and
December 31, 2023. As of March 31, 2024, SEE had
approximately $1.35 billion of
available liquidity comprised of $353
million of cash and $1.0
billion of available and unused lines of credit under our
committed credit facilities. The net leverage ratio, defined as net
debt divided by last twelve month Adjusted EBITDA, was 3.9x as of
March 31, 2024 and December 31, 2023.
2024 Full Year and Q2 Outlook
For the full year 2024, SEE continues to expect net sales in the
range of $5.2 to $5.6 billion and Adjusted EBITDA to be in the
range of $1.05 to $1.15 billion.
The Company continues to forecast full year Adjusted EPS to be
in the range of $2.65 to $3.05, which is based on approximately 146
million shares outstanding and an anticipated Adjusted Tax Rate in
the range of 26% to 27%.
The Company continues to expect Free Cash Flow in 2024 in the
range of $325 to $425 million, with capital expenditures expected
to be approximately $230 million.
Cash tax payments are expected to be in the range of $155 to $165
million.
For the second quarter 2024, SEE expects net sales and Adjusted
EBITDA to be approximately $1.3
billion and $260 million,
respectively, and Adjusted EPS to be in the range of $0.60 to $0.70.
Adjusted EBITDA, Adjusted EPS, Adjusted Tax Rate and Free Cash
Flow are non-U.S. GAAP financial measures. We have not provided
guidance for the most directly comparable U.S. GAAP financial
measures, as they are not available without unreasonable effort.
See "Non-U.S. GAAP Information" below.
Conference Call Information
SEE will host a conference call and webcast on Thursday,
May 2, 2024 at 10:00 a.m. (ET) to discuss our First
Quarter 2024 Results. The conference call will be webcast live on
the Investors homepage at www.sealedair.com/investors. A replay of
the webcast will also be available thereafter.
About SEE
Sealed Air Corporation (NYSE: SEE), is a leading global provider
of packaging solutions that integrate sustainable, high-performance
materials, automation, equipment and services. SEE designs,
manufactures and delivers packaging solutions that preserve food,
protect goods and automate packaging processes. We deliver our
packaging solutions to an array of end markets including fresh
proteins, foods, fluids and liquids, medical and life science,
e-commerce retail, logistics and omnichannel fulfillment
operations, and industrials. Our globally recognized solution
brands include CRYOVAC® food packaging,
LIQUIBOX® liquids systems, SEALED
AIR® protective packaging,
AUTOBAG® brand automated packaging systems, and
BUBBLE WRAP® brand packaging. In 2023, SEE
generated $5.5 billion in sales and
has approximately 17,000 employees who serve customers in
115 countries/territories.
www.sealedair.com
Website Information
We routinely post important information for investors on our
website, www.sealedair.com, in the Investors section. We use this
website as a means of disclosing material, non-public information
and for complying with our disclosure obligations under Regulation
FD. Accordingly, investors should monitor the Investors section of
our website, in addition to following our press releases, SEC
filings, public conference calls, presentations and webcasts. The
information contained on, or that may be accessed through, our
website is not incorporated by reference into, and is not a part
of, this document.
Non-U.S. GAAP Information
In this press release and supplement, we have included several
non-U.S. GAAP financial measures, including Net Debt, Adjusted Net
Earnings and Adjusted EPS, net sales on an "organic" and a
"constant dollar" basis, Free Cash Flow, Adjusted EBITDA and
Adjusted Tax Rate, as our management believes these measures are
useful to investors. We present results and guidance, adjusted to
exclude the effects of Special Items and their related tax impact
that would otherwise be included under U.S. GAAP, to aid in
comparisons with other periods or prior guidance. In addition,
non-U.S. GAAP measures are used by management to review and analyze
our operating performance and, along with other data, as internal
measures for setting annual budgets and forecasts, assessing
financial performance, providing guidance and comparing our
financial performance with our peers and may also be used for
purposes of determining incentive compensation. The non-U.S. GAAP
information has limitations as an analytical tool and should not be
considered in isolation from or as a substitute for U.S. GAAP
information. It does not purport to represent any similarly titled
U.S. GAAP information and is not an indicator of our performance
under U.S. GAAP. Non-U.S. GAAP financial measures that we present
may not be comparable with similarly titled measures used by
others. Investors are cautioned against placing undue reliance on
these non-U.S. GAAP measures. For a reconciliation of U.S. GAAP
measures to non-U.S. GAAP measures and other important information
on our use of non-U.S. GAAP financial measures, see the
attached supplementary information entitled "Condensed Consolidated
Statements of Cash Flows" (under the section entitled "Non-U.S.
GAAP Free Cash Flow"), "Calculation of Net Debt", "Reconciliation
of Net Earnings and Net Earnings Per Common Share to Non-U.S. GAAP
Adjusted Net Earnings and Non-U.S. GAAP Adjusted Net Earnings Per
Common Share," "Reconciliation of Net Earnings to Non-U.S. GAAP
Consolidated Adjusted EBITDA," "Components of Change in Net Sales
by Segment" and "Components of Change in Net Sales by Region."
Information reconciling forward-looking U.S. GAAP measures to
non-U.S. GAAP measures is not available without unreasonable
effort.
We have not provided guidance for the most directly comparable
U.S. GAAP financial measures, as they are not available without
unreasonable effort due to the high variability, complexity, and
low visibility with respect to certain Special Items, including
restructuring charges, adjustments in the valuation of our "SEE
Ventures" portfolio (which may include debt, equity method, or
equity investments), gains and losses related to acquisition and
divestiture of businesses, the ultimate outcome of certain legal or
tax proceedings, foreign currency gains or losses resulting from
the volatile currency market in Argentina, and other unusual gains and
losses. These items are uncertain, depend on various factors,
and could be material to our results computed in accordance with
U.S. GAAP.
Basis of Presentation
Unless otherwise stated, all results compare first quarter 2024
to first quarter 2023 results from continuing operations.
Year-over-year financial discussions present operating results from
continuing operations as reported. Year-over-year comparisons are
also made on an organic basis and constant dollar basis, which are
non-U.S. GAAP measures. Organic refers to changes in unit volume
and price performance and excludes acquisitions in the first year
after closing, divestiture activity and the impact of currency
translation. Constant dollar refers to changes in net sales and
earnings, excluding the impact of currency translation and
adjustments for other items affecting comparability.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 concerning our business, consolidated
financial condition, results of operations and cash flows.
Forward-looking statements are subject to risks and uncertainties,
many of which are outside our control, which could cause actual
results to differ materially from these statements. Therefore, you
should not rely on any of these forward-looking statements.
Forward-looking statements can be identified by such words as
"anticipate," "believe," "plan," "assume," "could," "should,"
"estimate," "expect," "intend," "potential," "seek," "predict,"
"may," "will" and similar references to future periods. All
statements other than statements of historical facts included in
this press release regarding our strategies, prospects, financial
condition, operations, costs, plans and objectives are
forward-looking statements. Examples of forward-looking statements
include, among others, statements we make regarding expected future
operating results, expectations regarding the results of
restructuring and other programs, expectations regarding future
impacts of acquisitions, anticipated levels of capital expenditures
and expectations of the effect on our financial condition of
claims, litigation, environmental costs, contingent liabilities and
governmental and regulatory investigations and proceedings.
The following are important factors that we believe could cause
actual results to differ materially from those in our
forward-looking statements: global economic and political
conditions, including recessionary and inflationary pressures,
currency translation and devaluation effects, changes in raw
material pricing and availability, competitive conditions, the
success of new product offerings, failure to realize synergies and
other financial benefits from acquisitions within the expected time
frames, greater than expected costs or difficulties related to
acquisition integrations, consumer preferences, the effects of
animal and food-related health issues, the effects of epidemics or
pandemics, negative impacts related to the ongoing conflict between
Russia and Ukraine and related sanctions, export
restrictions and other counteractions thereto, uncertainties
relating to existing or potential increased hostilities in the
Middle East, changes in energy
costs, environmental matters, the success of our restructuring
activities, the success of our merger, acquisition and equity
investment strategies, the success of our financial growth,
profitability, cash generation and manufacturing strategies and our
cost reduction and productivity efforts, changes in our credit
ratings, regulatory actions and legal matters and the other
information referenced in the "Risk Factors" section appearing in
our most recent Annual Report on Form 10-K, as filed with the
Securities and Exchange Commission, and as revised and updated by
our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Any forward-looking statement made by us is based only on
information currently available to us and speaks only as of the
date on which it is made. We undertake no obligation to publicly
update any forward-looking statements, whether written or oral,
that may be made from time to time, whether as a result of new
information, future developments or otherwise.
Company Contacts
Investors
Brian
Sullivan
brian.c.sullivan@sealedair.com
704.503.8841
Louise Lagache
louise.lagache@sealedair.com
Media
Christina
Griffin
christina.griffin@sealedair.com
704.430.5742
The supplementary information included for 2024 in this press
release on the current and subsequent pages is preliminary and
subject to change prior to the filing of our upcoming Quarterly
Report on Form 10-Q with the Securities and Exchange
Commission.
Sealed Air
Corporation
Condensed
Consolidated Statements of Operations
(Unaudited)
|
|
|
|
Three Months Ended
March 31,
|
(In USD
millions, except per share data)
|
|
2024
|
|
2023
|
Net sales
|
|
$
1,329.6
|
|
$
1,348.8
|
Cost of
sales
|
|
928.8
|
|
943.7
|
Gross
profit
|
|
400.8
|
|
405.1
|
Selling, general and
administrative expenses
|
|
185.5
|
|
221.6
|
Amortization expense of
intangible assets
|
|
14.8
|
|
15.2
|
Restructuring
charges
|
|
15.5
|
|
(1.2)
|
Operating
profit
|
|
185.0
|
|
169.5
|
Interest expense,
net
|
|
(65.1)
|
|
(57.8)
|
Other expense,
net
|
|
(0.8)
|
|
(15.0)
|
Earnings before income
tax provision
|
|
119.1
|
|
96.7
|
Income tax
provision
|
|
35.7
|
|
33.8
|
Net earnings from
continuing operations
|
|
83.4
|
|
62.9
|
Loss on sale of
discontinued operations, net of tax
|
|
(1.4)
|
|
(1.0)
|
Net
earnings
|
|
$
82.0
|
|
$
61.9
|
Basic:
|
|
|
|
|
Continuing
operations
|
|
$
0.58
|
|
$
0.44
|
Discontinued
operations
|
|
(0.01)
|
|
(0.01)
|
Net earnings per
common share - basic
|
|
$
0.57
|
|
$
0.43
|
Weighted average common
shares outstanding - basic
|
|
144.9
|
|
144.1
|
|
|
|
|
|
Diluted:
|
|
|
|
|
Continuing
operations
|
|
$
0.57
|
|
$
0.44
|
Discontinued
operations
|
|
(0.01)
|
|
(0.01)
|
Net earnings per
common share - diluted
|
|
$
0.56
|
|
$
0.43
|
Weighted average common
shares outstanding - diluted
|
|
145.4
|
|
144.8
|
Sealed Air
Corporation
Condensed
Consolidated Balance Sheets
(Unaudited)
|
|
(In USD
millions)
|
|
March 31,
2024
|
|
December 31,
2023
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
352.8
|
|
$
346.1
|
Trade receivables,
net
|
|
461.5
|
|
442.6
|
Income tax
receivables
|
|
27.6
|
|
44.9
|
Other
receivables
|
|
92.2
|
|
94.2
|
Advances and
deposits
|
|
69.7
|
|
72.8
|
Inventories,
net
|
|
790.2
|
|
774.3
|
Prepaid expenses and
other current assets
|
|
198.8
|
|
188.4
|
Total current
assets
|
|
1,992.8
|
|
1,963.3
|
Property and equipment,
net
|
|
1,411.2
|
|
1,416.4
|
Goodwill
|
|
2,887.7
|
|
2,892.5
|
Identifiable intangible
assets, net
|
|
425.6
|
|
439.0
|
Deferred
taxes
|
|
130.7
|
|
130.8
|
Operating lease
right-of-use-assets
|
|
80.3
|
|
86.5
|
Other non-current
assets
|
|
271.0
|
|
272.1
|
Total
assets
|
|
$
7,199.3
|
|
$
7,200.6
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term
borrowings
|
|
$
134.6
|
|
$
140.7
|
Current portion of
long-term debt
|
|
43.5
|
|
35.7
|
Current portion of
operating lease liabilities
|
|
27.4
|
|
29.2
|
Accounts
payable
|
|
811.8
|
|
764.6
|
Accrued restructuring
costs
|
|
28.8
|
|
23.1
|
Income tax
payable
|
|
28.2
|
|
28.7
|
Other current
liabilities
|
|
428.5
|
|
487.0
|
Total current
liabilities
|
|
1,502.8
|
|
1,509.0
|
Long-term debt, less
current portion
|
|
4,484.2
|
|
4,513.9
|
Long-term operating
lease liabilities, less current portion
|
|
61.8
|
|
66.7
|
Deferred
taxes
|
|
34.6
|
|
35.8
|
Other non-current
liabilities
|
|
517.6
|
|
525.7
|
Total
liabilities
|
|
6,601.0
|
|
6,651.1
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Preferred
stock
|
|
—
|
|
—
|
Common
stock
|
|
15.4
|
|
15.4
|
Additional paid-in
capital
|
|
1,423.4
|
|
1,429.5
|
Retained
earnings
|
|
548.9
|
|
496.5
|
Common stock in
treasury
|
|
(404.2)
|
|
(436.4)
|
Accumulated other
comprehensive loss, net of taxes
|
|
(985.2)
|
|
(955.5)
|
Total stockholders'
equity
|
|
598.3
|
|
549.5
|
Total liabilities
and stockholders' equity
|
|
$
7,199.3
|
|
$
7,200.6
|
Calculation of Net
Debt
(Unaudited)
|
|
(In USD
millions)
|
|
March 31,
2024
|
|
December 31,
2023
|
Short-term
borrowings
|
|
$
134.6
|
|
$
140.7
|
Current portion of
long-term debt
|
|
43.5
|
|
35.7
|
Long-term debt, less
current portion
|
|
4,484.2
|
|
4,513.9
|
Total debt
|
|
4,662.3
|
|
4,690.3
|
Less: cash and cash
equivalents
|
|
(352.8)
|
|
(346.1)
|
Non-U.S. GAAP Net
Debt
|
|
$
4,309.5
|
|
$
4,344.2
|
|
|
|
|
|
Net Leverage Ratio
(Net Debt / Last Twelve Months Adjusted EBITDA)
|
|
3.9x
|
|
3.9x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Last Twelve Months
Ended
|
(In USD
millions)
|
|
March 31,
2024
|
|
December 31,
2023
|
U.S. GAAP Net
earnings from continuing operations
|
|
$
359.8
|
|
$
339.3
|
Interest expense,
net
|
|
270.3
|
|
263.0
|
Income tax
provision
|
|
92.3
|
|
90.4
|
Depreciation and
amortization, net of adjustments
|
|
231.6
|
|
239.6
|
Special
Items:
|
|
|
|
|
Liquibox intangible
amortization
|
|
30.4
|
|
27.9
|
Liquibox inventory
step-up expense
|
|
1.8
|
|
10.2
|
Restructuring
charges
|
|
32.3
|
|
15.6
|
Other restructuring
associated costs
|
|
41.5
|
|
34.5
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
25.4
|
|
23.1
|
Loss on debt
redemption and refinancing activities
|
|
8.3
|
|
13.2
|
Contract
terminations
|
|
14.5
|
|
14.6
|
Charges related to
acquisition and divestiture activity
|
|
9.5
|
|
28.3
|
CEO
severance
|
|
6.1
|
|
6.1
|
Other Special
Items
|
|
(6.2)
|
|
0.8
|
Pre-tax impact of
Special items
|
|
$
163.6
|
|
$
174.3
|
Non-U.S. GAAP
Consolidated Adjusted EBITDA
|
|
$
1,117.6
|
|
$
1,106.6
|
Sealed Air
Corporation
Condensed
Consolidated Statements of Cash Flows
(Unaudited)
|
|
|
Three Months Ended
March 31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
Net earnings
|
|
$
82.0
|
|
$
61.9
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities(1)
|
|
71.9
|
|
102.6
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Trade receivables,
net
|
|
(28.9)
|
|
30.1
|
Inventories,
net
|
|
(33.5)
|
|
(32.0)
|
Accounts
payable
|
|
47.7
|
|
(62.8)
|
Customer advance
payments
|
|
(3.0)
|
|
4.7
|
Income tax
receivable/payable
|
|
17.2
|
|
12.7
|
Other assets and
liabilities
|
|
(28.3)
|
|
(65.3)
|
Net
cash provided by operating activities
|
|
$
125.1
|
|
$
51.9
|
Cash flows from
investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(47.1)
|
|
(64.9)
|
Proceeds related to
sale of business and property and equipment, net
|
|
0.2
|
|
0.6
|
Business acquired in
purchase transactions, net of cash acquired
|
|
4.2
|
|
(1,148.0)
|
Settlement of foreign
currency forward contracts
|
|
3.1
|
|
5.4
|
Proceeds from
cross-currency swaps
|
|
1.6
|
|
—
|
Net cash used in
investing activities
|
|
$
(38.0)
|
|
$
(1,206.9)
|
Cash flows from
financing activities:
|
|
|
|
|
Net (payments)
proceeds from short-term borrowings
|
|
(3.7)
|
|
167.9
|
Proceeds from
long-term debt
|
|
—
|
|
1,411.4
|
Payments of long-term
debt
|
|
(25.3)
|
|
(432.8)
|
Payments of debt
modification/extinguishment costs and other
|
|
—
|
|
(13.1)
|
Dividends paid on
common stock
|
|
(30.5)
|
|
(31.1)
|
Impact of tax
withholding on share-based compensation
|
|
(7.8)
|
|
(21.0)
|
Repurchases of common
stock
|
|
—
|
|
(79.9)
|
Principal payments
related to financing leases
|
|
(1.8)
|
|
(2.3)
|
Net cash (used in)
provided by financing activities
|
|
$
(69.1)
|
|
$
999.1
|
Effect of foreign
currency exchange rate changes on cash and cash
equivalents
|
|
$
(11.3)
|
|
$
2.9
|
Cash and cash
equivalents
|
|
346.1
|
|
456.1
|
Restricted cash and
cash equivalents
|
|
—
|
|
—
|
Balance, beginning
of period
|
|
$
346.1
|
|
$
456.1
|
Net change during
the period
|
|
$
6.7
|
|
$
(153.0)
|
Cash and cash
equivalents
|
|
352.8
|
|
303.1
|
Restricted cash and
cash equivalents
|
|
—
|
|
—
|
Balance, end of
period
|
|
$
352.8
|
|
$
303.1
|
|
|
|
|
|
Non-U.S. GAAP Free
Cash Flow:
|
|
|
|
|
Cash flow from
operating activities
|
|
$
125.1
|
|
$
51.9
|
Capital expenditures
for property and equipment
|
|
(47.1)
|
|
(64.9)
|
Non-U.S. GAAP Free
Cash Flow
|
|
$
78.0
|
|
$
(13.0)
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
Supplemental Cash
Flow Information:
|
|
|
|
|
Interest
payments
|
|
$
80.5
|
|
$
50.8
|
Income tax payments,
net of cash refunds
|
|
$
20.9
|
|
$
14.0
|
Restructuring payments
including associated costs
|
|
$
14.3
|
|
$
3.1
|
Non-cash
items:
|
|
|
|
|
Transfers of shares of
common stock from treasury for
profit-sharing contributions
|
|
$
25.4
|
|
$
23.9
|
_______________
|
(1)
|
2024 adjustments
primarily consist of depreciation and amortization of $60 million,
share-based compensation expense of $9 million, profit sharing
expense of $7 million, and provision for inventory obsolescence of
$6 million. 2023 adjustments primarily consist of depreciation and
amortization of $56 million, share-based compensation expense of
$18 million, profit sharing expense of $7 million, provision for
inventory obsolescence of $5 million, and loss on debt redemption
and refinancing activities of $5 million.
|
Sealed Air
Corporation
Reconciliation of
Net Earnings and Net Earnings Per Common Share to Non-U.S. GAAP
Adjusted
Net Earnings and
Non-U.S. GAAP Adjusted Net Earnings Per Common Share
(Unaudited)
|
|
|
Three Months Ended
March 31,
|
|
|
2024
|
|
2023
|
(In USD millions,
except per share data)
|
|
Net
Earnings
|
|
Diluted
EPS
|
|
Net
Earnings
|
|
Diluted
EPS
|
U.S. GAAP net
earnings and diluted EPS from continuing operations
|
|
$
83.4
|
|
$
0.57
|
|
$
62.9
|
|
$
0.44
|
Special
Items(1)
|
|
29.4
|
|
0.20
|
|
44.0
|
|
0.30
|
Non-U.S. GAAP
adjusted net earnings and adjusted diluted
EPS(2)
|
|
$ 112.8
|
|
$
0.78
|
|
$ 106.9
|
|
$
0.74
|
Weighted average
number of common shares outstanding - Diluted
|
|
|
|
145.4
|
|
|
|
144.8
|
_______________
|
(1)
|
Special Items include
items in the table below.
|
(2)
|
Adjusted diluted
earnings per share for the three months ended March 31, 2024
does not sum due to rounding.
|
|
|
Three Months
Ended
March
31,
|
(In USD millions,
except per share data)
|
|
2024
|
|
2023
|
Special
Items:
|
|
|
|
|
Liquibox intangible
amortization
|
|
$
7.5
|
|
$
5.0
|
Liquibox inventory
step-up expense
|
|
—
|
|
8.4
|
Restructuring
charges
|
|
15.5
|
|
(1.2)
|
Other restructuring
associated costs
|
|
6.8
|
|
(0.2)
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
4.9
|
|
2.6
|
Loss on debt
redemption and refinancing activities
|
|
—
|
|
4.9
|
Contract
terminations
|
|
(0.1)
|
|
—
|
Charges related to
acquisition and divestiture activity(i)
|
|
(1.9)
|
|
16.9
|
Other Special
Items(ii)
|
|
0.5
|
|
7.5
|
Pre-tax impact of
Special Items
|
|
33.2
|
|
43.9
|
Tax impact of Special
Items and Tax Special Items
|
|
(3.8)
|
|
0.1
|
Net impact of
Special Items
|
|
$
29.4
|
|
$
44.0
|
Weighted average
number of common shares outstanding - Diluted
|
|
145.4
|
|
144.8
|
Loss per share
impact from Special Items
|
|
$
(0.20)
|
|
$
(0.30)
|
____________
|
(i)
|
Charges related to
acquisition and divestiture activity for the three months ended
March 31, 2024 primarily consists of income recognized on the final
purchase price settlement related to the Liquibox
acquisition.
|
(ii)
|
Other Special Items for
the three months ended March 31, 2023 primarily relate to a
one-time, non-cash cumulative translation adjustment (CTA) loss
recognized due to the wind-up of one of our legal
entities.
|
The calculation of the non-U.S. GAAP Adjusted Tax Rate is as
follows:
|
|
Three Months
Ended
March
31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
U.S. GAAP Earnings
before income tax provision from continuing
operations
|
|
$ 119.1
|
|
$
96.7
|
Pre-tax impact of
Special Items
|
|
33.2
|
|
43.9
|
Non-U.S. GAAP
Adjusted Earnings before income tax provision
|
|
$ 152.3
|
|
$ 140.6
|
|
|
|
|
|
U.S. GAAP Income tax
provision from continuing operations
|
|
$
35.7
|
|
$
33.8
|
Tax Special
Items(1)
|
|
(4.1)
|
|
(6.3)
|
Tax impact of Special
Items
|
|
7.9
|
|
6.2
|
Non-U.S. GAAP
Adjusted Income tax provision
|
|
$
39.5
|
|
$
33.7
|
|
|
|
|
|
U.S. GAAP Effective
income tax rate
|
|
30.0 %
|
|
35.0 %
|
Non-U.S. GAAP Adjusted
Tax Rate
|
|
25.9 %
|
|
24.0 %
|
_____________
|
(1)
|
For the three months
ended March 31, 2024 and March 31, 2023, Tax Special
Items primarily reflect accruals for uncertain tax
positions.
|
Sealed Air
Corporation
Components of Change
in Net Sales by Segment
(Unaudited)
|
|
|
|
Three Months Ended
March 31,
|
(In USD
millions)
|
|
Food
|
|
Protective
|
|
Total
Company
|
2023 Net
Sales
|
|
$ 853.1
|
|
63.2 %
|
|
$ 495.7
|
|
36.8 %
|
|
$
1,348.8
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price
|
|
(32.9)
|
|
(3.8) %
|
|
(14.6)
|
|
(2.9) %
|
|
(47.5)
|
|
(3.5) %
|
Volume(1)
|
|
25.1
|
|
2.9 %
|
|
(18.8)
|
|
(3.8) %
|
|
6.3
|
|
0.5 %
|
Total organic change
(non-U.S. GAAP)(2)
|
|
(7.8)
|
|
(0.9) %
|
|
(33.4)
|
|
(6.7) %
|
|
(41.2)
|
|
(3.0) %
|
Acquisition
|
|
23.5
|
|
2.7 %
|
|
—
|
|
— %
|
|
23.5
|
|
1.7 %
|
Total constant dollar
change (non-U.S. GAAP)(2)
|
|
15.7
|
|
1.8 %
|
|
(33.4)
|
|
(6.7) %
|
|
(17.7)
|
|
(1.3) %
|
Foreign currency
translation
|
|
(0.4)
|
|
— %
|
|
(1.1)
|
|
(0.3) %
|
|
(1.5)
|
|
(0.1) %
|
Total change (U.S.
GAAP)
|
|
15.3
|
|
1.8 %
|
|
(34.5)
|
|
(7.0) %
|
|
(19.2)
|
|
(1.4) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$
868.4
|
|
65.3 %
|
|
$
461.2
|
|
34.7 %
|
|
$
1,329.6
|
|
100.0 %
|
Components of Change
in Net Sales by Region
(Unaudited)
|
|
|
|
Three Months Ended
March 31,
|
(In USD
millions)
|
|
Americas
|
|
EMEA
|
|
APAC
|
|
Total
|
2023 Net
Sales
|
|
$
878.1
|
|
65.1 %
|
|
$
289.5
|
|
21.5 %
|
|
$
181.2
|
|
13.4 %
|
|
$
1,348.8
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Price
|
|
(35.1)
|
|
(4.0) %
|
|
(11.6)
|
|
(4.0) %
|
|
(0.8)
|
|
(0.4) %
|
|
(47.5)
|
|
(3.5) %
|
Volume(1)
|
|
14.4
|
|
1.6 %
|
|
(8.9)
|
|
(3.1) %
|
|
0.8
|
|
0.4 %
|
|
6.3
|
|
0.5 %
|
Total organic change
(non-U.S. GAAP)(2)
|
|
(20.7)
|
|
(2.4) %
|
|
(20.5)
|
|
(7.1) %
|
|
—
|
|
— %
|
|
(41.2)
|
|
(3.0) %
|
Acquisition
|
|
17.2
|
|
2.0 %
|
|
4.0
|
|
1.4 %
|
|
2.3
|
|
1.3 %
|
|
23.5
|
|
1.7 %
|
Total constant dollar
change (non-U.S. GAAP)(2)
|
|
(3.5)
|
|
(0.4) %
|
|
(16.5)
|
|
(5.7) %
|
|
2.3
|
|
1.3 %
|
|
(17.7)
|
|
(1.3) %
|
Foreign currency
translation
|
|
6.3
|
|
0.7 %
|
|
0.5
|
|
0.2 %
|
|
(8.3)
|
|
(4.6) %
|
|
(1.5)
|
|
(0.1) %
|
Total change (U.S.
GAAP)
|
|
2.8
|
|
0.3 %
|
|
(16.0)
|
|
(5.5) %
|
|
(6.0)
|
|
(3.3) %
|
|
(19.2)
|
|
(1.4) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Net
Sales
|
|
$
880.9
|
|
66.2 %
|
|
$
273.5
|
|
20.6 %
|
|
$
175.2
|
|
13.2 %
|
|
$
1,329.6
|
|
100.0 %
|
_______________
|
(1)
|
Our volume reported
above includes the net impact of changes in unit volume as well as
the period-to-period change in the mix of products sold.
|
(2)
|
Total organic change is
a non-U.S. GAAP financial measure which excludes acquisitions
within the first twelve months after acquisition, divestiture
activity from the time of the sale, and the impact of foreign
currency translation. Total constant dollar change is a non-U.S.
GAAP financial measure which excludes the impact of foreign
currency translation. Since we are a U.S. domiciled company, we
translate our foreign currency denominated financial results into
U.S. dollars. Due to changes in the value of foreign currencies
relative to the U.S. dollar, translating our financial results from
foreign currencies to U.S. dollars may result in a favorable or
unfavorable impact. It is important that we take into account the
effects of foreign currency translation when we view our results
and plan our strategies. Nonetheless, we cannot control changes in
foreign currency exchange rates. Consequently, when our management
looks at our financial results to measure the core performance of
our business, we exclude the impact of foreign currency translation
by translating our current period results at prior period foreign
currency exchange rates and make adjustments for items that affect
comparability. We also may exclude the impact of foreign currency
translation when making incentive compensation determinations. As a
result, our management believes that these presentations are useful
internally and may be useful to our investors.
|
Sealed Air
Corporation
Segment
Information
Reconciliation of
Net Earnings to Non-U.S. GAAP Consolidated Adjusted
EBITDA
(Unaudited)
|
|
|
|
Three Months
Ended
March
31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
Adjusted EBITDA from
continuing operations:
|
|
|
|
|
Food
|
|
$ 189.6
|
|
$ 194.8
|
Adjusted EBITDA
Margin
|
|
21.8 %
|
|
22.8 %
|
Protective
|
|
89.5
|
|
80.4
|
Adjusted EBITDA
Margin
|
|
19.4 %
|
|
16.2 %
|
Corporate
|
|
(0.8)
|
|
(7.9)
|
Non-U.S. GAAP
Consolidated Adjusted EBITDA
|
|
$ 278.3
|
|
$ 267.3
|
Adjusted EBITDA
Margin
|
|
20.9 %
|
|
19.8 %
|
|
|
|
|
|
|
|
Three Months
Ended
March
31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
U.S. GAAP Net
earnings from continuing operations
|
|
$
83.4
|
|
$
62.9
|
Interest expense,
net
|
|
65.1
|
|
57.8
|
Income tax
provision
|
|
35.7
|
|
33.8
|
Depreciation and
amortization, net of adjustments(1)
|
|
60.9
|
|
68.9
|
Special
Items:
|
|
|
|
|
Liquibox intangible
amortization
|
|
7.5
|
|
5.0
|
Liquibox inventory
step-up expense
|
|
—
|
|
8.4
|
Restructuring
charges
|
|
15.5
|
|
(1.2)
|
Other restructuring
associated costs
|
|
6.8
|
|
(0.2)
|
Foreign currency
exchange loss due to highly inflationary economies
|
|
4.9
|
|
2.6
|
Loss on debt
redemption and refinancing activities
|
|
—
|
|
4.9
|
Contract
terminations
|
|
(0.1)
|
|
—
|
Charges related to
acquisition and divestiture activity
|
|
(1.9)
|
|
16.9
|
Other Special
Items
|
|
0.5
|
|
7.5
|
Pre-tax impact of
Special items
|
|
33.2
|
|
43.9
|
Non-U.S. GAAP
Consolidated Adjusted EBITDA
|
|
$ 278.3
|
|
$
267.3
|
__________
|
(1)
|
Depreciation and
amortization by segment are as follows:
|
|
|
Three Months
Ended
March
31,
|
(In USD
millions)
|
|
2024
|
|
2023
|
Food
|
|
$
46.9
|
|
$
46.7
|
Protective
|
|
21.5
|
|
27.2
|
Consolidated
depreciation and amortization(i)
|
|
$
68.4
|
|
$
73.9
|
Liquibox intangible
amortization
|
|
(7.5)
|
|
(5.0)
|
Depreciation and
amortization, net of adjustments
|
|
$
60.9
|
|
$
68.9
|
__________
|
(i)
|
Includes share-based
incentive compensation of $8.7 million and $18.0 million for the
three months ended March 31, 2024 and 2023,
respectively.
|
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SOURCE SEE