The company reaffirms fiscal year 2015
guidance
Greif, Inc. (NYSE: GEF, GEF.B), a global leader in industrial
packaging products and services, today reported first quarter 2015
net income attributable to the corporation totaling $30.1 million
or $0.52 per diluted Class A share on sales of $902.3 million
compared with net income of $30.7 million or $0.53 per diluted
Class A share on sales of $1,001.5 million in the first quarter of
2014. After adjusting for the effect of dispositions, facility
closures and currency fluctuations, sales for the quarter were flat
compared to the first quarter of 2014. Excluding the impact of
special items1, earnings were $0.30 per diluted Class A share
compared to $0.46 per diluted Class A share for the first quarter
of 2014.
David B. Fischer, president and chief executive officer, stated,
“Net sales for the first quarter of 2015 excluding divestitures and
foreign currency translation were similar to the same period last
year. Our results were also adversely impacted by product and
geographic mix issues resulting in lower gross profit, a higher
effective tax rate and lower results in the Flexible Packaging
business compared to a year ago. We are aggressively executing
transformation initiatives through portfolio optimization and
specific opportunities in individual work streams. During the past
few quarters we have taken actions to sell non-core businesses and
continue to address operations that no longer fit our business
portfolio. Since the beginning of the first quarter 2015, we have
announced the closing of four plants located primarily in North
America, APAC and Europe and divested three businesses. We expect
the benefits of these actions to make positive contributions to our
results beginning in the second half of this year.”
Rigid Industrial Packaging & Services
Net sales decreased 8.8 percent to $649.7 million for the first
quarter of 2015 compared with $712.3 million for the first quarter
of 2014. Excluding the impact of divestitures and facility
closures2, net sales decreased 6.4 percent to $648.9 million for
the first quarter of 2015 compared with $692.9 million for the
first quarter of 2014. The decrease in net sales was attributable
to the negative impact of foreign currency translation. Volumes
were flat overall compared to the first quarter of 2014, with
increases in North America and Europe offset by a decrease in Latin
America.
Operating profit was $20.2 million for the first quarter of 2015
compared to $29.2 million for the first quarter of 2014. Operating
profit excluding special items and the impact of divestitures and
facility closures was $21.8 million for the first quarter of 2015
versus $34.3 million for the first quarter of 2014. The decrease
was primarily due to the negative impact of foreign currency
translation, higher health care and pension costs and lower gross
margins in Europe and North America due to product mix.
Paper Packaging
Net sales decreased 6.2 percent to $159.2 million for the first
quarter of 2015 compared with $169.8 million for the first quarter
of 2014. Excluding the impact of divestitures and facility
closures, net sales decreased 3.5 percent to $159.2 million for the
first quarter of 2015 compared with $165.0 million for the first
quarter of 2014. The decrease was attributable to lower volumes,
primarily due to one less shipping day and softness in demand for
containerboard toward the end of the quarter.
Operating profit was $28.1 million for the first quarter of 2015
compared with $30.0 million for the first quarter of 2014.
Operating profit before special items and excluding the impact of
divestitures and facility closures was $28.2 million for the first
quarter of 2015 compared with $29.0 million for the first quarter
of 2014. The decrease was due to lower volumes for
containerboard.
Flexible Products & Services
Net sales decreased 22.2 percent to $88.1 million for the first
quarter of 2015 compared with $113.2 million for the first quarter
of 2014. Excluding the impact of divestitures and facility
closures, net sales decreased 8.9 percent to $84.9 million compared
with $93.2 million for the first quarter of 2014. The decrease was
primarily attributable to the negative impact of foreign currency
translation.
Operating loss was $8.8 million for the first quarter of 2015
versus operating profit of $0.8 million for the first quarter of
2014. Operating loss before special items and excluding the impact
of divestitures and facility closures was $8.8 million for the
first quarter of 2015 versus $1.2 million for the first quarter of
2014. This increase in operating loss was due to several factors.
We incurred higher freight costs to meet lead time demands of
customers. We incurred an inventory write down adjustment in part
due to the combination of rapidly decreasing resin prices and
higher inventory levels from the carryover impact of the occupation
of our Hadimkoy facility as we transitioned back to full capacity.
In addition, the higher costs of the move to an in-house labor
force, prompted primarily by changes in the local regulatory
environment, and the inefficiencies incurred as a result of this
move, also contributed to the increase in the operating loss for
this segment.
Land Management
Net sales decreased 14.5 percent to $5.3 million for the first
quarter of 2015 compared with $6.2 million for the first quarter of
2014. The decrease was due to lower timber sales as planned for the
first quarter of 2015.
Timberland gains were $24.3 million and $8.4 million for the
first quarter of 2015 and 2014, respectively, and are recorded as
gains on disposal of properties, plants and equipment, net.
Operating profit was $25.9 million for the first quarter of 2015
compared with $11.4 million for the first quarter of 2014. This
increase was due to $24.3 million of timberland gains in the first
quarter of 2015 compared to $8.4 million of timberland gains in the
first quarter of 2014. Operating profit before special items was
$1.2 million for the first quarter of 2015 compared with $1.6
million for the first quarter of 2014. The decrease was due to the
same item impacting net sales for this segment.
Dividends
On March 3, 2015, the Board of Directors declared quarterly cash
dividends of $0.42 per share of Class A Common Stock and $0.63 per
share of Class B Common Stock. Dividends are payable on April 1,
2015, to stockholders of record at close of business on March 19,
2015.
Company Outlook
The company continues to anticipate the overall global economy
to reflect a modest recovery in fiscal 2015, with positive aspects
of the improving economy in the United States being offset by the
negative trends in other regions, particularly in Europe and Latin
America. We anticipate that foreign currency matters will continue
to present challenges for the company, as the strengthening of the
United States dollar against other currencies will continue to
impact the company’s revenues and net income. In addition, an
expected approximately two-week shutdown of the company’s
Riverville mill during the third quarter for the installation of
upgrades will negatively impact our 2015 net income. We are
continuing to execute restructuring plans and facility closures and
pursuing the sale of select non-core assets as part of our overall
strategic transformation, which are expected to result in
significant impairment and restructuring charges in the remainder
of 2015. SG&A cost savings actions are being implemented
throughout 2015 and beyond. Based on these factors, fiscal 2015
adjusted Class A earnings per share remains in the range of $2.25
to $2.35, excluding gains and losses on the sales of businesses,
timberland and property, plant and equipment, and acquisition
related costs, as well as restructuring and impairment charges.
GREIF, INC. AND SUBSIDIARY COMPANIES
SELECTED FINANCIAL HIGHLIGHTS UNAUDITED (Dollars in
millions, except per share amounts)
Three months
ended January 31,
Selected Financial
Highlights
2015 2014 Net sales $
902.3 $ 1,001.5 Operating profit 65.4 71.4 Operating profit before
special items 42.3 65.3 EBITDA 99.9 107.8 Cash provided by
operating activities (71.0 ) (62.8 ) Net income attributable to
Greif, Inc. 30.1 30.7 Diluted Class A earnings per share
attributable to Greif, Inc. $ 0.52 $ 0.53 Diluted Class A earnings
per share attributable to Greif, Inc. before special items $ 0.30 $
0.46
Special
items
Restructuring charges $ (3.2 ) $ (2.4 ) Acquisition-related costs
(0.2 ) (0.5 ) Timberland gains 24.3 8.4 Non-cash asset impairment
charges (0.2 ) (0.2 ) Gain on disposal of properties, plants,
equipment and businesses, net 2.4 0.8
Total special items 23.1 6.1 Total
special items, net of tax 13.4 4.1
Impact of total special items, net of tax, on diluted Class A
earnings per share attributable to Greif, Inc. $ 0.22 $ 0.07
January 31, 2015 October 31, 2014
Working capital 3 $ 343.1 $ 303.0 Net working capital
3
287.3 217.9 Long-term debt 1,127.8 1,087.4 Net debt 4 1,150.7
1,068.0
2015
Impact ofDivestituresand
FacilityClosures
Excluding theImpact
ofDivestituresand FacilityClosures
2015
Net Sales $ 902.3 $ 4.0 $ 898.3 Gross Profit 153.9 0.3 153.6
Operating Profit 65.4 (0.1 ) 65.5 Operating profit (loss) before
special items
: 42.3 (0.1 ) 42.4
2014
Impact ofDivestituresand
FacilityClosures
Excluding theImpact
ofDivestituresand FacilityClosures
2014
Net Sales $ 1,001.5 $ 44.2 $ 957.3 Gross Profit 186.1 7.3 178.8
Operating Profit 71.4 1.6 69.8 Operating profit (loss) before
special items
: 65.3 1.6 63.7
Conference Call
The company will host a conference call to discuss the first
quarter of 2015 results on March 5, 2015, at 10 a.m. Eastern
Time (ET). To participate, domestic callers should call
877-485-3107 and ask for the Greif conference call. The number for
international callers is +1 201-689-8427. Phone lines will open at
9:50 a.m. ET. The conference call will also be available through a
live webcast, including slides, which can be accessed at
www.greif.com in the Investor Center/Conference Calls. A replay of
the conference call will be available on the company’s website
approximately one hour following the call.
About Greif
Greif is a world leader in industrial packaging products and
services. The company produces steel, plastic, fibre, flexible and
corrugated containers and containerboard, and provides
reconditioning, blending, filling and packaging services for a wide
range of industries. Greif also manages timber properties in North
America. The company is strategically positioned in more than 50
countries to serve global as well as regional customers. Additional
information is on the company's website at www.greif.com.
Forward-Looking Statements
All statements, other than statements of historical facts,
included in this news release, including without limitation
statements regarding our future financial position, business
strategy, budgets, projected costs, goals and plans and objectives
of management for future operations, are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements generally can be identified by
the use of forward-looking terminology such as “may,” “will,”
“expect,” “intend,” “estimate,” “anticipate,” “project,” “believe,”
“continue,” “on track” or “target” or the negative thereof or
variations thereon or similar terminology. All forward-looking
statements made in this news release are based on information
currently available to management.
Although we believe that the expectations reflected in
forward-looking statements have a reasonable basis, we can give no
assurance that these expectations will prove to be correct.
Forward-looking statements are subject to risks and uncertainties
that could cause actual events or results to differ materially from
those expressed in or implied by the statements. Such risks and
uncertainties that might cause a difference include, but are not
limited to, the following: (i) historically, our business has been
sensitive to changes in general economic or business conditions,
(ii) our operations subject us to currency exchange and political
risks that could adversely affect our results of operations, (iii)
the current and future challenging global economy and disruption
and volatility of the financial and credit markets may adversely
affect our business, (iv) the continuing consolidation of our
customer base and suppliers may intensify pricing pressure, (v) we
operate in highly competitive industries, (vi) our business is
sensitive to changes in industry demands, (vii) raw material and
energy price fluctuations and shortages may adversely impact our
manufacturing operations and costs, (viii) we may encounter
difficulties arising from acquisitions, (ix) we may incur
additional restructuring costs and there is no guarantee that our
efforts to reduce costs will be successful, (x) tax legislation
initiatives or challenges to our tax positions may adversely impact
our results or condition, (xi) full realization of our deferred tax
assets may be affected by a number of factors, (xii) several
operations are conducted by joint ventures that we cannot operate
solely for our benefit, (xiii) our ability to attract, develop and
retain talented and qualified employees, managers and executives is
critical to our success, (xiv) our business may be adversely
impacted by work stoppages and other labor relations matters, (xv)
we may be subject to losses that might not be covered in whole or
in part by existing insurance reserves or insurance coverage, (xvi)
our business depends on the uninterrupted operations of our
facilities, systems and business functions, including our
information technology and other business systems, (xvii) a
security breach of customer, employee, supplier or company
information may have a material adverse effect on our business,
financial condition and results of operations, (xviii)
legislation/regulation related to environmental and health and
safety matters and corporate social responsibility could negatively
impact our operations and financial performance, (xix) product
liability claims and other legal proceedings could adversely affect
our operations and financial performance, (xx) we may incur fines
or penalties, damage to our reputation or other adverse
consequences if our employees, agents or business partners violate,
or are alleged to have violated, anti-bribery, competition or other
laws, (xxi) changing climate, climate change regulations and
greenhouse gas effects may adversely affect our operations and
financial performance, (xxii) the frequency and volume of our
timber and timberland sales will impact our financial performance,
(xxiii) changes in U.S. generally accepted accounting principles
and SEC rules and regulations could materially impact our reported
results, (xxiv) if the company fails to maintain an effective
system of internal control, the company may not be able to
accurately report financial results or prevent fraud, and (xxv) the
company has a significant amount of goodwill, and if impaired in
the future, would adversely impact our results of operations.
Changes in business results may impact our book tax rates. The
risks described above are not all-inclusive, and given these and
other possible risks and uncertainties, investors should not place
undue reliance on forward-looking statements as a prediction of
actual results. For a detailed discussion of the most significant
risks and uncertainties that could cause our actual results to
differ materially from those projected, see “Risk Factors” in Part
I, Item 1A of our most recently filed Form 10-K and our other
filings with the Securities and Exchange Commission. All
forward-looking statements made in this news release are expressly
qualified in their entirety by reference to such risk factors.
Except to the limited extent required by applicable law, we
undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
GREIF, INC. AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME UNAUDITED
(Dollars and shares in millions, except per share amounts)
Three months ended January 31, 2015
2014 Net sales $ 902.3 $ 1,001.5
Cost of products sold 748.4 815.4 Gross
profit 153.9 186.1 Selling, general and administrative
expenses 111.8 121.3 Restructuring charges 3.2 2.4 Timberland gains
(24.3 ) (8.4 ) Non-cash asset impairment charges 0.2 0.2 (Gain)
loss on disposal of properties, plants and equipment, net (1.6 )
(2.6 ) (Gain) loss on disposal of businesses (0.8 )
1.8 Operating profit 65.4 71.4 Interest
expense, net 19.6 20.4 Other expense, net 0.1
2.8 Income before income tax expense and equity
earnings of unconsolidated affiliates, net 45.7 48.2 Income
tax expense 17.5 16.5 Equity earnings of unconsolidated
affiliates, net of tax - 0.1 Net income
28.2 31.8 Net (income) loss attributable to noncontrolling
interests 1.9 (1.1 ) Net income attributable
to Greif, Inc. $ 30.1 $ 30.7
Basic earnings
per share attributable to Greif, Inc. common shareholders:
Class A Common Stock $ 0.52 $ 0.53 Class B Common Stock $ 0.76 $
0.78
Diluted earnings per share attributable to Greif,
Inc. common shareholders: Class A Common Stock $ 0.52 $ 0.53
Class B Common Stock $ 0.76 $ 0.78
Shares used to
calculate basic earnings per share attributable to Greif, Inc.
common shareholders: Class A Common Stock 25.6 25.5 Class B
Common Stock 22.1 22.1
Shares used to calculate diluted
earnings per share attributable to Greif, Inc. common
shareholders: Class A Common Stock 25.6 25.5 Class B Common
Stock 22.1 22.1
GREIF, INC. AND SUBSIDIARY
COMPANIES CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED (Dollars in millions)
January 31, 2015
October 31, 2014 ASSETS CURRENT ASSETS
Cash and cash equivalents $ 55.8 $ 85.1 Trade accounts receivable
462.7 501.3 Inventories 382.2 381.1 Other current assets
171.4 187.2 1,072.1 1,154.7 LONG-TERM
ASSETS Goodwill 836.7 880.2 Intangible assets 152.6 166.5 Assets
held by special purpose entities 50.9 50.9 Other long-term assets
116.7 122.1 1,156.9 1,219.7
PROPERTIES, PLANTS AND EQUIPMENT 1,278.5 1,293.0
$ 3,507.5 $ 3,667.4
LIABILITIES AND EQUITY
CURRENT LIABILITIES Accounts payable $ 392.8 $ 471.1
Short-term borrowings 58.5 48.1 Current portion of long-term debt
20.2 17.6 Other current liabilities 257.5 314.9
729.0 851.7 LONG-TERM LIABILITIES Long-term
debt 1,127.8 1,087.4 Liabilities held by special purpose entities
43.3 43.3 Other long-term liabilities 459.1 461.8
1,630.2 1,592.5 TOTAL EQUITY 1,148.3
1,223.2 $ 3,507.5 $ 3,667.4
GREIF,
INC. AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in millions)
Three months ended January 31,
2015 2014 CASH FLOWS FROM
OPERATING ACTIVITIES: Net income $ 28.2 $ 31.8 Depreciation,
depletion and amortization 34.6 39.2 Asset impairments 0.2 0.2
Other non-cash adjustments to net income (21.6 ) (10.3 ) Working
capital changes (59.3 ) (92.8 )
Increase (decrease) in cash from changes
in certain assets and liabilities and other
(53.1 ) (30.9 ) Net cash used in operating activities
(71.0 ) (62.8 ) CASH FLOWS FROM INVESTING
ACTIVITIES: Acquisitions of companies, net of cash acquired (0.4 )
(52.3 ) Purchases of properties, plants, equipment and timber
properties (53.5 ) (42.5 ) Proceeds from the sale of properties,
plants, equipment, businesses, timberland and other assets 39.0
14.8 Payments on notes receivable with related party, net -
0.4 Net cash used in investing activities
(14.9 ) (79.6 ) CASH FLOWS FROM FINANCING
ACTIVITIES: Proceeds from (payments on) debt, net 84.3 175.0
Payment of deferred purchase price related to acquisitions - -
Dividends paid (24.5 ) (24.4 ) Other 0.1 0.1
Net cash provided by financing activities 59.9
150.7 EFFECTS OF EXCHANGE RATES ON CASH (3.3 )
(4.4 ) Net increase (decrease) in cash and cash equivalents (29.3 )
3.9 Cash and cash equivalents at beginning of the period
85.1 78.1 Cash and cash equivalents at end of
the period $ 55.8 $ 82.0
GREIF, INC. AND SUBSIDIARY COMPANIES FINANCIAL HIGHLIGHTS
BY SEGMENT UNAUDITED (Dollars in millions)
Three months ended January 31, 2015
2014 Net sales: Rigid Industrial Packaging
& Services $ 649.7 $ 712.3 Paper Packaging 159.2 169.8 Flexible
Products & Services 88.1 113.2 Land Management 5.3
6.2 Total net sales $ 902.3 $ 1,001.5
Operating
profit (loss): Rigid Industrial Packaging & Services $ 20.2
$ 29.2 Paper Packaging 28.1 30.0 Flexible Products & Services
(8.8) 0.8 Land Management 25.9 11.4 Total operating
profit $ 65.4 $ 71.4
EBITDA 5: Rigid
Industrial Packaging & Services $ 44.8 $ 53.8 Paper Packaging
35.5 38.0 Flexible Products & Services (7.0) 3.8 Land
Management 26.6 12.2 Total EBITDA $ 99.9 $ 107.8
GREIF, INC. AND SUBSIDIARY
COMPANIES SPECIAL ITEMS BY SEGMENT UNAUDITED (Dollars in
millions)
Three months ended January
31, 2015 2014 Rigid Industrial Packaging &
Services Restructuring charges $ 2.4 $ 2.3 Acquisition-related
costs 0.2 0.5 Non-cash asset impairment charges 0.1 0.2 (Gain) loss
on disposal of properties, plants, equipment and businesses, net
(1.2) 1.5 Total special Items 1.5 4.5
Paper
Packaging (Gain) loss on disposal of properties, plants,
equipment and businesses, net - (0.8) Total special
Items - (0.8)
Flexible Products & Services
Restructuring charges 0.8 0.1 Non-cash asset impairment charges 0.1
- (Gain) loss on disposal of properties, plants, equipment and
businesses, net (0.8) (0.1) Total special Items 0.1 -
Land Management Timberland gains (24.3) (8.4) (Gain)
loss on disposal of properties, plants, equipment and businesses,
net (0.4) (1.4) Total special Items (24.7)
(9.8) Total special items $ (23.1) $ (6.1)
GREIF, INC. AND SUBSIDIARY COMPANIES
GAAP TO NON-GAAP RECONCILIATION NET WORKING CAPITAL AND
NET DEBT UNAUDITED (Dollars in millions)
January 31, 2015 October 31, 2014 Current
assets $ 1,072.1 $ 1,154.7 Less: current liabilities 729.0
851.7 Working capital 343.1 303.0 Less: cash and cash
equivalents 55.8 85.1 Net working capital $ 287.3 $
217.9 Long-term debt $ 1,127.8 $ 1,087.4 Plus: current
portion of long-term debt 20.2 17.6 Plus: short-term borrowings
58.5 48.1 Less: cash and cash equivalents 55.8 85.1
Net debt $ 1,150.7 $ 1,068.0
GREIF, INC. AND
SUBSIDIARY COMPANIES GAAP TO NON-GAAP RECONCILIATION
CONSOLIDATED EBITDA 6 UNAUDITED (Dollars in millions)
Three months ended January 31,
2015 2014 Net income $ 28.2 $ 31.8 Plus:
interest expense, net 19.6 20.4 Plus: income tax expense 17.5 16.5
Plus: depreciation, depletion and amortization expense 34.6 39.2
Less: equity earnings of unconsolidated affiliates, net of tax
- 0.1 EBITDA $ 99.9 $ 107.8 Net income $ 28.2
$ 31.8 Plus: interest expense, net 19.6 20.4 Plus: income tax
expense 17.5 16.5 Plus: other expense, net 0.1 2.8 Less: equity
earnings of unconsolidated affiliates, net of tax -
0.1 Operating profit 65.4 71.4 Less: other expense, net 0.1 2.8
Plus: depreciation, depletion and amortization expense 34.6
39.2 EBITDA $ 99.9 $ 107.8
GREIF, INC. AND
SUBSIDIARY COMPANIES GAAP TO NON-GAAP RECONCILIATION
SEGMENT EBITDA 7 UNAUDITED (Dollars in millions)
Three months ended January 31,
2015 2014 Rigid Industrial Packaging &
Services Operating profit $ 20.2 $ 29.2 Less: other expense,
net (0.4) 2.9 Plus: depreciation and amortization expense
24.2 27.5 EBITDA $ 44.8 $ 53.8
Paper Packaging
Operating profit $ 28.1 $ 30.0 Less: other (income) expense, net -
(0.8) Plus: depreciation and amortization expense 7.4
7.2 EBITDA $ 35.5 $ 38.0
Flexible Products &
Services Operating profit (loss) $ (8.8) $ 0.8 Less: other
expense, net 0.5 0.7 Plus: depreciation and amortization expense
2.3 3.7 EBITDA $ (7.0) $ 3.8
Land
Management Operating profit $ 25.9 $ 11.4 Plus: depreciation,
depletion and amortization expense 0.7 0.8 EBITDA $
26.6 $ 12.2 Consolidated EBITDA $ 99.9 $ 107.8
GREIF, INC. AND SUBSIDIARY COMPANIES GAAP TO NON-GAAP
RECONCILIATION FREE CASH FLOW 8 UNAUDITED
(Dollars in millions)
Three months ended
January 31, 2015 2014 Net cash used
in operating activities $ (71.0) $ (62.8) Less: Capital
expenditures (28.1) (34.5)
Free Cash Flows $
(99.1) $ (97.3)
GREIF, INC. AND SUBSIDIARY
COMPANIES GEOGRAPHIC DATA UNAUDITED (Dollars in
millions)
Three months ended January
31, 2015 2014 Net sales: North
America $ 434.6 $ 467.5 Europe, Middle East and Africa 319.8 375.0
Asia Pacific and Latin America 147.9 159.0 Total net
sales $ 902.3 $ 1,001.5
Operating profit: North
America $ 57.6 $ 53.7 Europe, Middle East and Africa 2.5 13.9 Asia
Pacific and Latin America 5.3 3.8 Total operating
profit $ 65.4 $ 71.4 Notes: The North America region
includes businesses from Rigid Industrial Packaging & Services,
Paper Packaging, Flexible Products & Services and Land
Management. The Europe, Middle East and Africa region
includes businesses from Rigid Industrial Packaging & Services
and Flexible Products & Services. The Asia Pacific and
Latin America region includes businesses from Rigid Industrial
Packaging & Services and Flexible Products & Services.
GREIF, INC. AND SUBSIDIARY COMPANIES GAAP
TO NON-GAAP RECONCILIATION SEGMENT OPERATING PROFIT (LOSS)
BEFORE SPECIAL ITEMS UNAUDITED (Dollars in millions)
Three months ended
January 31,
2015 2014 Operating profit (loss):
Rigid Industrial Packaging & Services $ 20.2 $ 29.2 Paper
Packaging 28.1 30.0 Flexible Products & Services (8.8) 0.8 Land
Management 25.9 11.4 Total operating profit (loss)
65.4 71.4
Restructuring charges: Rigid
Industrial Packaging & Services 2.4 2.3 Flexible Products &
Services 0.8 0.1 Total restructuring charges
3.2 2.4
Acquisition-related costs: Rigid Industrial
Packaging & Services 0.2 0.5 Total
acquisition-related costs 0.2 0.5
Timberland
gains: Land Management (24.3) (8.4) Total
timberland gains (24.3) (8.4)
Non-cash asset
impairment charges: Rigid Industrial Packaging & Services
0.1 0.2 Flexible Products & Services 0.1 - Total
non-cash asset impairment charges 0.2 0.2
(Gain)
loss on disposal of properties, plants, equipment and businesses,
net: Rigid Industrial Packaging & Services (1.2) 1.5 Paper
Packaging - (0.8) Flexible Products & Services (0.8) (0.1) Land
Management (0.4) (1.4) Total (gain) loss on disposal
of properties, plants, equipment and businesses, net: (2.4)
(0.8)
Operating profit (loss) before special items
9: Rigid Industrial Packaging & Services 21.7
33.7 Paper Packaging 28.1 29.2 Flexible Products & Services
(8.7) 0.8 Land Management 1.2 1.6 Total operating
profit (loss) before special items $ 42.3 $ 65.3
GREIF, INC. AND SUBSIDIARY COMPANIES GAAP TO NON-GAAP
RECONCILIATION SEGMENT EBITDA BEFORE SPECIAL ITEMS
UNAUDITED (Dollars in millions)
Three months
ended January 31, 2015 2014
EBITDA 10:
Rigid Industrial Packaging & Services $ 44.8 $ 53.8 Paper
Packaging 35.5 38.0 Flexible Products & Services (7.0 ) 3.8
Land Management 26.6 12.2 Total EBITDA
99.9 107.8
Restructuring
charges: Rigid Industrial Packaging & Services 2.4 2.3
Flexible Products & Services 0.8 0.1
Total restructuring charges 3.2 2.4
Acquisition-related costs: Rigid Industrial Packaging
& Services 0.2 0.5 Total
acquisition-related costs 0.2 0.5
Timberland gains: Land Management (24.3 ) (8.4
) Total timberland gains (24.3 ) (8.4 )
Non-cash
asset impairment charges: Rigid Industrial Packaging &
Services 0.1 0.2 Flexible Products & Services 0.1
- Total non-cash asset impairment charges 0.2
0.2
(Gain) loss on disposal of properties,
plants, equipment and businesses, net: Rigid Industrial
Packaging & Services (1.2 ) 1.5 Paper Packaging - (0.8 )
Flexible Products & Services (0.8 ) (0.1 ) Land Management
(0.4 ) (1.4 ) Total (gain) loss on disposal of
properties, plants, equipment and businesses, net: (2.4 )
(0.8 )
EBITDA before special items 11:
Rigid Industrial Packaging & Services 46.3 58.3 Paper Packaging
35.5 37.2 Flexible Products & Services (6.9 ) 3.8 Land
Management 1.9 2.4 Total EBITDA before
special items $ 76.8 $ 101.7
GREIF, INC. AND SUBSIDIARY COMPANIES GAAP TO NON-GAAP
RECONCILIATION CLASS A EARNINGS PER SHARE EXCLUDING SPECIAL
ITEMS UNAUDITED (Dollars in millions)
Quarter ended
January 31, 2015 Class A
Net Income Attributable to Greif
$ 30.1 $ 0.52
Less: (Gain) loss on disposal of
properties, plants, equipment and businesses, net
(1.4 ) (0.02 ) Less: Timberland Gains (14.9 ) (0.25 ) Plus:
Restructuring charges 2.7 0.05 Plus: Non-cash asset impairment
charges 0.1 - Plus: Acquisition related costs 0.1
-
Net Income Attributable to Greif Excluding
Special Items
$ 16.7 $ 0.30 Note: All special items
are net of tax and noncontrolling interests
Quarter ended
January 31, 2014 Class A Net Income
Attributable to Greif $ 30.7 $ 0.53
Less: (Gain) loss on disposal of
properties, plants, equipment and businesses, net
(0.6 ) (0.01 ) Less: Timberland Gains (5.5 ) (0.09 ) Plus:
Restructuring charges 1.6 0.02 Plus: Non-cash asset impairment
charges 0.1 - Plus: Acquisition related costs 0.3
0.01 Net Income Attributable to Greif
Excluding Special Items $ 26.6 $ 0.46
GREIF, INC. AND SUBSIDIARY COMPANIES GAAP TO NON-GAAP
RECONCILIATION SELECTED FINANCIAL INFORMATION EXCLUDING
THE IMPACT OF DIVESTITURES AND FACILITY CLOSURES UNAUDITED
(Dollars in millions)
Three months ended
January 31, Excluding the Impact
of Impact of Divestitures and Divestitures
and Facility Closures 2015 Facility
Closures
2015 (12)
Net Sales: Rigid Industrial Packaging & Services $ 649.7
$ 0.8 $ 648.9 Paper Packaging 159.2 - 159.2 Flexible Products and
Services 88.1 3.2 84.9 Land Management 5.3 -
5.3 Consolidated $ 902.3 $ 4.0 $
898.3
Gross Profit: Rigid Industrial Packaging
& Services $ 104.6 $ (0.1 ) $ 104.7 Paper Packaging 40.6 (0.1 )
40.7 Flexible Products and Services 7.1 0.5 6.6 Land Management
1.6 - 1.6 Consolidated $
153.9 $ 0.3 $ 153.6
Operating
Profit: Rigid Industrial Packaging & Services $ 20.2 $ (0.1
) $ 20.3 Paper Packaging 28.1 (0.1 ) 28.2 Flexible Products and
Services (8.8 ) 0.1 (8.9 ) Land Management 25.9
- 25.9 Consolidated $ 65.4 $
(0.1 ) $ 65.5
Operating profit (loss) before
special items 13: Rigid Industrial Packaging
& Services $ 21.7 $ (0.1 ) $ 21.8 Paper Packaging 28.1 (0.1 )
28.2 Flexible Products and Services (8.7 ) 0.1 (8.8 ) Land
Management 1.2 - 1.2
Consolidated $ 42.3 $ (0.1 ) $ 42.4
Excluding the Impact of Impact of
Divestitures and Divestitures and Facility
Closures 2014 Facility Closures
2014 (12)
Net Sales: Rigid Industrial Packaging & Services $ 712.3
$ 19.4 $ 692.9 Paper Packaging 169.8 4.8 165.0 Flexible Products
and Services 113.2 20.0 93.2 Land Management 6.2
- 6.2 Consolidated $ 1,001.5 $
44.2 $ 957.3
Gross Profit: Rigid
Industrial Packaging & Services $ 118.9 $ 2.4 $ 116.5 Paper
Packaging 43.3 0.7 42.6 Flexible Products and Services 21.8 4.2
17.6 Land Management 2.1 - 2.1
Consolidated $ 186.1 $ 7.3 $ 178.8
Operating Profit: Rigid Industrial Packaging &
Services $ 29.2 $ (0.6 ) $ 29.8 Paper Packaging 30.0 0.2 29.8
Flexible Products and Services 0.8 2.0 (1.2 ) Land Management
11.4 - 11.4 Consolidated
$ 71.4 $ 1.6 $ 69.8
Operating profit
(loss) before special items 13: Rigid Industrial
Packaging & Services $ 33.7 $ (0.6 ) $ 34.3 Paper Packaging
29.2 0.2 29.0 Flexible Products and Services 0.8 2.0 (1.2 ) Land
Management 1.6 - 1.6
Consolidated $ 65.3 $ 1.6 $ 63.7 Note:
The 2014 acquisitions were completed at the beginning of the fiscal
year and are not adjusted because they are fully reflected in both
periods. 1 A summary of all special items that are included
in the price per diluted Class A share before special items and
operating profit before special items is set forth in the Selected
Financial Highlights table following the Company Outlook in this
release 2 A summary of all adjustments related to the divestitures
and facility closures that are excluded from net sales, gross
profit and operating profit is set forth in the Selected Financial
Highlights table following the Company Outlook in this release
Note: A reconciliation of the differences between all
non-GAAP financial measures used in this release with the most
directly comparable GAAP financial measures is included in the
financial schedules that are a part of this release. 3
Working capital represents current assets less current liabilities.
Net working capital represents working capital less cash and cash
equivalents. 4 Net debt represents long-term debt plus the current
portion of long-term debt plus short-term borrowings less cash and
cash equivalents. 5 EBITDA is defined as net income, plus interest
expense, net, plus income tax expense, less equity earnings of
unconsolidated affiliates, net of tax, plus depreciation, depletion
and amortization. However, because the company does not calculate
net income by segment, this table calculates EBITDA by segment with
reference to operating profit (loss) by segment, which, as
demonstrated in the table of Consolidated EBITDA, is another method
to achieve the same result. See the reconciliations in the table of
Segment EBITDA. 6 EBITDA is defined as net income, plus interest
expense, net, plus income tax expense, less equity earnings of
unconsolidated affiliates, net of tax, plus depreciation, depletion
and amortization. As demonstrated in this table, EBITDA can also be
calculated with reference to operating profit. 7 EBITDA is defined
as net income, plus interest expense, net, plus income tax expense,
less equity earnings of unconsolidated affiliates, net of tax, plus
depreciation, depletion and amortization. However, because the
company does not calculate net income by segment, this table
calculates EBITDA by segment with reference to operating profit
(loss) by segment, which, as demonstrated in the table of
Consolidated EBITDA, is another method to achieve the same result.
8 Free cash flow is defined as net cash provided by operating
activities less capital expenditures. 9 Operating profit (loss)
before special items is defined as operating profit (loss) plus
restructuring charges plus acquisition-related costs plus non-cash
impairment charges less timberland gains less (gain) loss on
disposal of properties, plants, equipment and businesses, net. 10
EBITDA is defined as net income, plus interest expense, net, plus
income tax expense, less equity earnings of unconsolidated
affiliates, net of tax, plus depreciation, depletion and
amortization. However, because the company does not calculate net
income by segment, this table calculates EBITDA by segment with
reference to operating profit (loss) by segment, which, as
demonstrated in the table of Consolidated EBITDA, is another method
to achieve the same result. See the reconciliations in the table of
Segment EBITDA. 11 EBITDA before special items is defined as EBITDA
plus restructuring charges plus acquisition-related costs plus
non-cash impairment charges less timberland gains less (gain) loss
on disposal of properties, plants, equipment and businesses, net.
12 Results excluding the impact of divestitures and facility
closures reflects net sales, gross profit and operating profit
adjusted for divestitures and facility closures occurring during
FY14 and FY15. 13
See table contained herein entitled GAAP
to Non-GAAP Reconciliation Segment Operating Profit (Loss) Before
Special Items for a reconciliation of each segment’s operation
profit (loss) before special items.
Greif, Inc.Analyst:Robert Lentz, 614-876-2000orMedia:Scott
Griffin, 740-657-6516
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