DELAWARE, Ohio, March 2,
2022 /PRNewswire/ -- Greif, Inc. (NYSE: GEF, GEF.B), a
global leader in industrial packaging products and services, today
announced first quarter 2022 results.
First Quarter Financial Highlights include (all results
compared to the first quarter of 2021 unless otherwise
noted):
- Net income of $10.3 million or
$0.18 per diluted Class A share
decreased compared to net income of $23.4
million or $0.40 per diluted
Class A share. Net income, excluding the impact of
adjustments(1), of $75.6
million or $1.28 per diluted
Class A share increased compared to net income, excluding the
impact of adjustments, of $35.9
million or $0.61 per diluted
Class A share.
- Adjusted EBITDA(2) of $196.8
million, an increase of $58.3
million compared to Adjusted EBITDA of $138.5 million.
- Net cash provided by operating activities increased by
$10.9 million to $22.4 million. Adjusted free cash
flow(3) decreased by $7.3
million to a use of $18.8
million.
- Total debt decreased by $242.6
million to $2,296.8 million.
Net debt(4) decreased by $260.9
million to $2,177.1 million.
The Company's leverage ratio(5) decreased to 2.39x from
3.79x and from 2.49x at year-end.
Strategic Actions and Announcements
- Completed our planned Chief Executive Officer transition and
announced new executive leadership team
- Announced a definitive agreement to divest our 50% equity
interest in the Flexible Products & Services joint venture to
Gulf Refined Packaging ("the FPS Divestiture") for $123 million, subject to post-closing
adjustments. The transaction is expected to close by
March 31, 2022
- Redeemed our $500 million 6.5%
2027 senior notes on March 1 with
proceeds from our refinanced credit facilities, which were expanded
and extended for an additional 5 years and include an ESG-linked
feature that ties our borrowing cost to Greif's EcoVadis rating.
The net result is a reduction in Greif's anticipated annual
interest expense of approximately $15
million
- Received a gold medal rating for Corporate Social
Responsibility (CSR) performance from EcoVadis, a multinational CSR
ratings agency, for the fourth year in a row
- Announced that Investor Day 2022 will be held on June 23, 2022 in New
York City
CEO Commentary
"Our team delivered an outstanding first quarter," said
Ole Rosgaard, Greif's President and
Chief Executive Officer. "Through disciplined operational execution
and a sharp focus on the areas within our control, we generated
record financial results while navigating the still challenging and
volatile operating environment. In addition, we solidified our
leverage position and announced the agreement to sell our 50%
ownership stake in Flexible Products and Services business for
outstanding value. Looking ahead, we are increasing our Fiscal 2022
guidance based on our strong start and positive outlook for the
remainder of the year."
|
|
|
|
|
|
|
|
|
(1)
|
Adjustments that are
excluded from net income before adjustments and from earnings per
diluted Class A share before adjustments are restructuring charges,
integration related costs, non-cash asset impairment charges,
non-cash pension settlement charges, incremental COVID-19 costs,
net, (gain) loss on disposal of properties, plants, equipment and
businesses, net.
|
|
(2)
|
Adjusted EBITDA is
defined as net income, plus interest expense, net, plus income tax
expense, plus depreciation, depletion and amortization expense,
plus restructuring charges, plus integration related costs, plus
non-cash asset impairment charges, plus non-cash pension settlement
charges, plus incremental COVID-19 costs, net, plus (gain) loss on
disposal of properties, plants, equipment and businesses,
net.
|
|
(3)
|
Adjusted free cash
flow is defined as net cash provided by operating activities, less
cash paid for purchases of properties, plants and equipment, plus
cash paid for integration related costs, plus cash paid for
incremental COVID-19 costs, net, plus cash paid for integration
related Enterprise Resource Planning (ERP) systems.
|
|
(4)
|
Net debt is defined
as total debt less cash and cash equivalents.
|
|
(5)
|
Leverage ratio for
the periods indicated is defined as net debt divided by trailing
twelve month EBITDA, each as calculated under the terms of the
Company's Amended and Restated Credit Agreement dated as of
February 11, 2019, filed as Exhibit 10.1 on Form 8-K/A on March 26,
2020 (the "2019 Credit Agreement").
|
|
|
|
|
|
|
|
|
|
|
Customer Service
The Company's consolidated CSI(6) score was 93.7
during the fiscal first quarter and 93.6 on a trailing four quarter
basis. Our long term objective is for each business segment to
achieve a CSI score of 95.0 or greater.
CSI for the Global Industrial Packaging segment was 94.7, flat
to the prior year quarter.
CSI for the Paper Packaging & Services segment was 92.2,
3.9% higher than the prior year quarter.
Segment Results (all results compared to the first quarter of
2021 unless otherwise noted)
Net sales are impacted mainly by the volume of primary
products(7) sold, selling prices, product mix and the
impact of changes in foreign currencies against the U.S. Dollar.
The table below shows the percentage impact of each of these items
on net sales for our primary products for the first quarter of 2022
as compared to the prior year quarter for the business segments
with manufacturing operations.
Net Sales Impact -
Primary Products
|
Global Industrial
Packaging
|
|
Paper Packaging &
Services
|
Currency
Translation
|
(4.0)%
|
|
— %
|
Volume
|
2.4%
|
|
1.1%
|
Selling Prices and
Product Mix
|
47.9%
|
|
24.0%
|
Total Impact of
Primary Products
|
46.3%
|
|
25.1%
|
Global Industrial Packaging
Net sales increased by $289.8
million to $949.1 million. Net
sales excluding foreign currency translation increased by
$315.2 million primarily due to
higher volumes and higher average sales prices.
Gross profit increased by $46.8
million to $177.1 million. The
increase in gross profit was primarily due to the same factors that
impacted net sales, partially offset by higher raw material
costs.
Operating profit decreased by $23.0
million to $31.0 million due
to a $62.4 million non-cash
impairment charge related to the anticipated FPS Divestiture,
offset by the same factors that impacted gross profit. Adjusted
EBITDA increased by $34.7 million to
$114.2 million primarily due to the
same factors that impacted gross profit.
Paper Packaging & Services
Net sales increased by $129.1
million to $610.0 million. Net
sales excluding foreign currency translation increased by
$128.9 million primarily due to
higher volumes and higher published containerboard and boxboard
prices.
Gross profit increased by $31.2
million to $110.8 million. The
increase in gross profit was primarily due to the same factors that
impacted net sales, partially offset by higher raw material,
transportation and utility costs.
Operating profit increased by $24.0 million to $38.3 million. Adjusted EBITDA increased by
$24.4 million to $80.5 million primarily due to the same factors
that impacted gross profit.
Land Management
Net sales decreased by $1.1
million to $5.2 million due to
less timber being available for sale as a result of acreage sold in
the prior year.
Operating profit increased by $1.0
million to $2.7 million.
Adjusted EBITDA decreased by $0.8
million to $2.1 million.
Tax Summary
During the first quarter, the Company recorded an income tax
rate of 67.3 percent, which was significantly impacted by the
non-deductible nature of the non-cash impairment recorded in the
quarter for the anticipated FPS divestiture as well as the mix of
jurisdictional income and less positive impact of discrete tax
items. The Company's tax rate excluding the impact of adjustments
was 30.7 percent. Note that the application of FIN 18 frequently
causes fluctuations in our quarterly effective tax rates. For
fiscal 2022, the Company expects its tax rate to range between 28.0
and 32.0 percent and its tax rate excluding adjustments to range
between 22.0 and 25.0 percent.
Dividend Summary
On March 1, 2022, the Board of
Directors declared quarterly cash dividends of $0.46 per share of Class A Common Stock and
$0.69 per share of Class B Common
Stock. Dividends are payable on April 1,
2022, to stockholders of record at the close of business on
March 17, 2022.
Company Outlook
(in millions,
except per share amounts)
|
Fiscal 2022
Outlook
Reported at Q1*
|
Class A earnings per
share before adjustments
|
$6.30 -
$6.90
|
Adjusted free cash
flow
|
$380 -
$440
|
|
|
* This fiscal 2022
outlook excludes contribution from the Flexible Products &
Services joint venture after expected divestiture on March 31,
2022.
|
|
|
|
Note: Fiscal 2022
Class A earnings per share guidance on a GAAP basis is not provided
in this release due to the potential for one or more of the
following, the timing and magnitude of which we are unable to
reliably forecast: restructuring-related activities; integration
related costs; non-cash pension settlement charges; non-cash asset
impairment charges due to unanticipated changes in the business;
gains or losses on the disposal of businesses or properties, plants
and equipment, net and the income tax effects of these items and
other income tax-related events. No reconciliation of the fiscal
2022 Class A earnings per share before adjustments guidance, a
non-GAAP financial measure which excludes restructuring charges,
integration costs, non-cash asset impairment charges, non-cash
pension settlement charges, (gain) loss on the disposal of
properties, plants, equipment and businesses, net, is included in
this release because, due to the high variability and difficulty in
making accurate forecasts and projections of some of the excluded
information, together with some of the excluded information not
being ascertainable or accessible, we are unable to quantify
certain amounts that would be required to be included in the most
directly comparable GAAP financial measure without unreasonable
efforts. A reconciliation of 2022 adjusted free cash flow guidance
to forecasted net cash provided by operating activities, the most
directly comparable GAAP financial measure, is included in this
release.
|
|
|
|
|
(6)
|
Customer satisfaction
index (CSI) tracks a variety of internal metrics designed to
enhance the customer experience in dealing with Greif.
|
|
(7)
|
Primary products are
manufactured steel, plastic and fibre drums; new and reconditioned
intermediate bulk containers; 1&2 loop and 4 loop flexible
intermediate bulk containers; linerboard, containerboard,
corrugated sheets and corrugated containers; and boxboard and tube
and core products.
|
|
|
|
|
Conference Call
The Company will host a conference call to discuss first quarter
2022 results on March 3, 2022, at
8:30 a.m. Eastern Time (ET).
Participants may access the call using the following online
registration link:
https://conferencingportals.com/event/BDwosPDa. Registrants
will receive a confirmation email containing dial in details and a
unique conference call code for entry. Phone lines will open at
8:00 a.m. ET on March 3, 2022. A digital replay of the conference
call will be available two hours following the call on the
company's web site at http://investor.greif.com. To access the
recording, guests can call (800) 770-2030 or (647) 362-9199 and use
the conference ID 32605.
Investor Day 2022 Details
Investor Day 2022 will be held on Thursday, June 23, 2022 at Convene at 75
Rockefeller Plaza in New York
City. Registration and breakfast will begin at 8AM ET and the event will start at 9AM ET. Greif's President and Chief Executive
Officer Ole Rosgaard, Chief
Financial Officer Larry Hilsheimer
and members of Greif's executive leadership team will provide an
overview of the Company; discuss ongoing business performance and
the Build to Last strategy; and conduct a forum for questions and
answers. A live webcast for the event will also be conducted and
details will be provided in June
2022. For additional information or early registration,
please contact InvestorDay@greif.com.
Investor Relations contact information
Matt Eichmann, Vice President,
Chief Marketing and Sustainability Officer, 740-549-6067.
Matt.eichmann@greif.com
Matt Leahy, Vice President,
Corporate Development & Investor Relations, 740-549-6158.
Matthew.leahy@greif.com
About Greif
Greif is a global leader in industrial packaging products and
services and is pursuing its vision: to be the best performing
customer service company in the world. The Company produces steel,
plastic and fibre drums, intermediate bulk containers,
reconditioned containers, flexible products, containerboard,
uncoated recycled paperboard, coated recycled paperboard, tubes and
cores and a diverse mix of specialty products. The Company also
manufactures packaging accessories and provides filling, packaging
and other services for a wide range of industries. In addition,
Greif manages timber properties in the southeastern United States. The Company is strategically
positioned in over 40 countries to serve global as well as regional
customers. Additional information is on the Company's website
at www.greif.com.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
The words "may," "will," "expect," "intend," "estimate,"
"anticipate," "aspiration," "objective," "project," "believe,"
"continue," "on track" or "target" or the negative thereof and
similar expressions, among others, identify forward-looking
statements. All forward-looking statements are based on
assumptions, expectations and other information currently available
to management. Such forward-looking statements are subject to
certain risks and uncertainties that could cause the Company's
actual results to differ materially from those forecasted,
projected or anticipated, whether expressed or implied. The
most significant of these risks and uncertainties are described in
Part I of the Company's Annual Report on Form 10-K for the fiscal
year ended October 31, 2021. The Company undertakes no
obligation to update or revise any forward-looking statements.
Although the Company believes that the expectations reflected in
forward-looking statements have a reasonable basis, the Company can
give no assurance that these expectations will prove to be correct.
Forward-looking statements are subject to risks and uncertainties
that could cause the Company's actual results to differ materially
from those forecasted, projected or anticipated, whether 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 global
operations subject us to political risks, instability and currency
exchange that could adversely affect our results of operations,
(iii) the COVID-19 pandemic could continue to impact any
combination of our business, financial condition, results of
operations and cash flows, (iv) the current and future challenging
global economy and disruption and volatility of the financial and
credit markets may adversely affect our business, (v) the
continuing consolidation of our customer base and suppliers may
intensify pricing pressure, (vi) we operate in highly competitive
industries, (vii) our business is sensitive to changes in industry
demands and customer preferences, (viii) raw material, price
fluctuations, global supply chain disruptions and inflation may
adversely impact our results of operations, (ix) energy and
transportation price fluctuations and shortages may adversely
impact our manufacturing operations and costs, (x) the frequency
and volume of our timber and timberland sales will impact our
financial performance, (xi) we may not successfully implement our
business strategies, including achieving our growth objectives,
(xii) we may encounter difficulties or liabilities arising from
acquisitions or divestitures, (xiii) we may incur additional
rationalization costs and there is no guarantee that our efforts to
reduce costs will be successful, (xiv) several operations are
conducted by joint ventures that we cannot operate solely for our
benefit, (xv) certain of the agreements that govern our joint
ventures provide our partners with put or call options, (xvi) our
ability to attract, develop and retain talented and qualified
employees, managers and executives is critical to our success,
(xvii) our business may be adversely impacted by work stoppages and
other labor relations matters, (xviii) we may be subject to losses
that might not be covered in whole or in part by existing insurance
reserves or insurance coverage and general insurance premium and
deductible increases, (xix) our business depends on the
uninterrupted operations of our facilities, systems and business
functions, including our information technology and other business
systems, (xx) a security breach of customer, employee, supplier or
Company information and data privacy risks and costs of compliance
with new regulations may have a material adverse effect on our
business, financial condition, results of operations and cash
flows, (xxi) we could be subject to changes to our tax rates, the
adoption of new U.S. or foreign tax legislation or exposure to
additional tax liabilities, (xxii) full realization of our deferred
tax assets may be affected by a number of factors, (xxiii) we have
a significant amount of goodwill and long-lived assets which, if
impaired in the future, would adversely impact our results of
operations, (xxiv) our pension and post-retirement plans are
underfunded and will require future cash contributions and our
required future cash contributions could be higher than we expect,
each of which could have a material adverse effect on our financial
condition and liquidity, (xxv) legislation/regulation related to
environmental and health and safety matters and corporate social
responsibility could negatively impact our operations and financial
performance, (xxvi) product liability claims and other legal
proceedings could adversely affect our operations and financial
performance, (xxvii) 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, (xxviii) changing climate,
global climate change regulations and greenhouse gas effects may
adversely affect our operations and financial performance, (xxix)
we may be unable to achieve our greenhouse gas emission reduction
targets by 2030. 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
forecasted, projected or anticipated, 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
|
|
|
Three months ended
January 31,
|
(in millions,
except per share amounts)
|
2022
|
|
2021
|
Net sales
|
$
1,564.3
|
|
$
1,146.5
|
Cost of products
sold
|
1,274.6
|
|
934.3
|
Gross
profit
|
289.7
|
|
212.2
|
Selling, general and
administrative expenses
|
151.6
|
|
134.3
|
Restructuring
charges
|
3.5
|
|
3.1
|
Integration related
costs
|
1.6
|
|
2.0
|
Non-cash asset
impairment charges
|
62.4
|
|
1.3
|
(Gain) loss on
disposal of properties, plants and equipment, net
|
(1.4)
|
|
1.6
|
Gain on disposal of
businesses, net
|
—
|
|
(0.1)
|
Operating
profit
|
72.0
|
|
70.0
|
Interest expense,
net
|
17.1
|
|
25.2
|
Non-cash pension
settlement charges
|
—
|
|
8.5
|
Other income,
net
|
2.0
|
|
—
|
Income before income
tax expense and equity earnings of unconsolidated affiliates,
net
|
52.9
|
|
36.3
|
Income tax
expense
|
35.6
|
|
6.1
|
Equity earnings of
unconsolidated affiliates, net of tax
|
(1.3)
|
|
(0.7)
|
Net income
|
18.6
|
|
30.9
|
Net income
attributable to noncontrolling interests
|
(8.3)
|
|
(7.5)
|
Net income
attributable to Greif, Inc.
|
$
10.3
|
|
$
23.4
|
Basic earnings per
share attributable to Greif, Inc. common
shareholders:
|
|
|
|
Class A common
stock
|
$
0.17
|
|
$
0.40
|
Class B common
stock
|
$
0.25
|
|
$
0.59
|
Diluted earnings
per share attributable to Greif, Inc. common
shareholders:
|
|
|
|
Class A common
stock
|
$
0.18
|
|
$
0.40
|
Class B common
stock
|
$
0.25
|
|
$
0.59
|
Shares used to
calculate basic earnings per share attributable to Greif, Inc.
common shareholders:
|
|
|
|
Class A common
stock
|
26.0
|
|
26.5
|
Class B common
stock
|
22.0
|
|
22.0
|
Shares used to
calculate diluted earnings per share attributable to Greif, Inc.
common shareholders:
|
|
|
|
Class A common
stock
|
26.2
|
|
26.5
|
Class B common
stock
|
22.0
|
|
22.0
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
UNAUDITED
|
|
(in
millions)
|
January 31,
2022
|
|
October 31,
2021
|
ASSETS
|
|
|
|
CURRENT
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
119.7
|
|
$
124.6
|
Trade accounts
receivable
|
816.1
|
|
889.5
|
Inventories
|
488.3
|
|
499.2
|
Other current
assets
|
279.9
|
|
150.8
|
|
1,704.0
|
|
1,664.1
|
LONG-TERM
ASSETS
|
|
|
|
Goodwill
|
1,500.5
|
|
1,515.4
|
Intangible
assets
|
628.0
|
|
648.4
|
Operating lease
assets
|
287.0
|
|
289.4
|
Other long-term
assets
|
190.3
|
|
177.3
|
|
2,605.8
|
|
2,630.5
|
PROPERTIES, PLANTS
AND EQUIPMENT
|
1,456.8
|
|
1,521.2
|
|
$
5,766.6
|
|
$
5,815.8
|
LIABILITIES AND
EQUITY
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
Accounts
payable
|
$
619.6
|
|
$
704.5
|
Short-term
borrowings
|
37.4
|
|
50.5
|
Current portion of
long-term debt
|
120.3
|
|
120.3
|
Current portion of
operating lease liabilities
|
54.3
|
|
54.0
|
Other current
liabilities
|
448.9
|
|
384.8
|
|
1,280.5
|
|
1,314.1
|
LONG-TERM
LIABILITIES
|
|
|
|
Long-term
debt
|
2,139.1
|
|
2,054.8
|
Operating lease
liabilities
|
237.0
|
|
239.5
|
Other long-term
liabilities
|
533.6
|
|
607.7
|
|
2,909.7
|
|
2,902.0
|
REDEEMABLE
NONCONTROLLING INTERESTS
|
19.1
|
|
24.1
|
EQUITY
|
|
|
|
Total Greif, Inc.
equity
|
1,493.3
|
|
1,514.3
|
Noncontrolling
interests
|
64.0
|
|
61.3
|
|
1,557.3
|
|
1,575.6
|
|
$
5,766.6
|
|
$
5,815.8
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
(in
millions)
|
2022
|
|
2021
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
Net income
|
$
18.6
|
|
$
30.9
|
Depreciation,
depletion and amortization
|
59.4
|
|
59.3
|
Asset
impairments
|
62.4
|
|
1.3
|
Pension settlement
charges
|
—
|
|
8.5
|
Other non-cash
adjustments to net income
|
19.2
|
|
15.9
|
Operating working
capital changes
|
(58.1)
|
|
(52.6)
|
Decrease in cash from
changes in other assets and liabilities
|
(79.1)
|
|
(51.8)
|
Net cash provided by
operating activities
|
22.4
|
|
11.5
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
Purchases of
properties, plants and equipment
|
(44.5)
|
|
(27.4)
|
Purchases of and
investments in timber properties
|
(4.8)
|
|
(1.0)
|
Collections of
receivables held in special purpose entities
|
—
|
|
50.9
|
Payments for issuance
of loans receivable
|
—
|
|
(15.0)
|
Other
|
3.5
|
|
(3.3)
|
Net cash (used in)
provided by investing activities
|
(45.8)
|
|
4.2
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
Proceeds on long-term
debt, net
|
84.0
|
|
40.7
|
Dividends paid to
Greif, Inc. shareholders
|
(27.2)
|
|
(25.9)
|
Payments for
liabilities held in special purpose entities
|
—
|
|
(43.3)
|
Other
|
(2.8)
|
|
(1.5)
|
Net cash provided by
(used in) financing activities
|
54.0
|
|
(30.0)
|
Effects of exchange
rates on cash
|
(18.6)
|
|
9.8
|
Net decrease in cash
and cash equivalents
|
12.0
|
|
(4.5)
|
Cash and cash
equivalents, beginning of period
|
124.6
|
|
105.9
|
Cash and cash
equivalents, end of period*
|
$
136.6
|
|
$
101.4
|
*Ending cash includes
$16.9 million of cash presented within held for sale on the
Condensed Consolidated Balance Sheet due to the expected FPS
Divestiture
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
FINANCIAL
HIGHLIGHTS BY SEGMENT
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
(in
millions)
|
2022
|
|
2021
|
Net
sales:
|
|
|
|
Global Industrial
Packaging
|
$
949.1
|
|
$
659.3
|
Paper
Packaging & Services
|
610.0
|
|
480.9
|
Land
Management
|
5.2
|
|
6.3
|
Total net
sales
|
$
1,564.3
|
|
$
1,146.5
|
Gross
profit:
|
|
|
|
Global Industrial
Packaging
|
$
177.1
|
|
$
130.3
|
Paper
Packaging & Services
|
110.8
|
|
79.6
|
Land
Management
|
1.8
|
|
2.3
|
Total gross
profit
|
$
289.7
|
|
$
212.2
|
Operating
profit:
|
|
|
|
Global Industrial
Packaging
|
$
31.0
|
|
$
54.0
|
Paper
Packaging & Services
|
38.3
|
|
14.3
|
Land
Management
|
2.7
|
|
1.7
|
Total operating
profit
|
$
72.0
|
|
$
70.0
|
EBITDA(8):
|
|
|
|
Global Industrial
Packaging
|
$
51.0
|
|
$
75.8
|
Paper
Packaging & Services
|
76.2
|
|
42.9
|
Land
Management
|
3.5
|
|
2.8
|
Total
EBITDA
|
$
130.7
|
|
$
121.5
|
Adjusted
EBITDA(9):
|
|
|
|
Global Industrial
Packaging
|
$
114.2
|
|
$
79.5
|
Paper
Packaging & Services
|
80.5
|
|
56.1
|
Land
Management
|
2.1
|
|
2.9
|
Total Adjusted
EBITDA
|
$
196.8
|
|
$
138.5
|
|
|
(8)
EBITDA is defined as net income, plus
interest expense, net, plus income tax expense, 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 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.
|
(9) Adjusted EBITDA is defined as net income, plus
interest expense, net, plus income tax expense, plus depreciation,
depletion and amortization expense, plus restructuring charges,
plus integration related costs, plus non-cash asset impairment
charges, plus non-cash pension settlement charges, plus incremental
COVID-19 costs, net, plus (gain) loss on disposal of properties,
plants, equipment and businesses, net.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
CONSOLIDATED
ADJUSTED EBITDA
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
(in
millions)
|
2022
|
|
2021
|
Net income
|
$
18.6
|
|
$
30.9
|
Plus: Interest
expense, net
|
17.1
|
|
25.2
|
Plus: Income tax
expense
|
35.6
|
|
6.1
|
Plus: Depreciation,
depletion and amortization expense
|
59.4
|
|
59.3
|
EBITDA
|
$
130.7
|
|
$
121.5
|
Net income
|
$
18.6
|
|
$
30.9
|
Plus: Interest
expense, net
|
17.1
|
|
25.2
|
Plus: Income tax
expense
|
35.6
|
|
6.1
|
Plus: Non-cash pension
settlement charges
|
—
|
|
8.5
|
Plus: Other expense,
net
|
2.0
|
|
—
|
Plus: Equity earnings
of unconsolidated affiliates, net of tax
|
(1.3)
|
|
(0.7)
|
Operating
profit
|
$
72.0
|
|
$
70.0
|
Less: Non-cash pension
settlement charges
|
—
|
|
8.5
|
Less: Other expense,
net
|
2.0
|
|
—
|
Less: Equity earnings
of unconsolidated affiliates, net of tax
|
(1.3)
|
|
(0.7)
|
Plus: Depreciation,
depletion and amortization expense
|
59.4
|
|
59.3
|
EBITDA
|
$
130.7
|
|
$
121.5
|
Plus: Restructuring
charges
|
3.5
|
|
3.1
|
Plus: Integration
related costs
|
1.6
|
|
2.0
|
Plus: Non-cash asset
impairment charges
|
62.4
|
|
1.3
|
Plus: Non-cash pension
settlement charges
|
—
|
|
8.5
|
Plus: Incremental
COVID-19 costs, net (10)
|
—
|
|
0.6
|
Plus: (Gain) Loss on
disposal of properties, plants, equipment, and businesses,
net
|
(1.4)
|
|
1.5
|
Adjusted
EBITDA
|
$
196.8
|
|
$
138.5
|
|
|
(10) Incremental COVID-19 costs, net includes costs
directly attributable to COVID-19 such as costs incurred for
incremental cleaning and sanitation efforts and employee safety
measures, offset by economic relief received from foreign
governments.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
SEGMENT ADJUSTED
EBITDA(11)
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
(in
millions)
|
2022
|
|
2021
|
Global Industrial
Packaging
|
|
|
|
Operating
profit
|
31.0
|
|
54.0
|
Less: Other expense
(income), net
|
1.9
|
|
(0.1)
|
Less: Equity earnings
of unconsolidated affiliates, net of tax
|
(1.3)
|
|
(0.7)
|
Plus: Depreciation and
amortization expense
|
20.6
|
|
21.0
|
EBITDA
|
$
51.0
|
|
$
75.8
|
Plus: Restructuring
charges
|
2.1
|
|
2.8
|
Plus: Non-cash asset
impairment charges
|
62.4
|
|
1.3
|
Plus: Incremental
COVID-19 costs, net
|
—
|
|
0.3
|
Plus: Gain on disposal
of properties, plants, equipment and businesses, net
|
(1.3)
|
|
(0.7)
|
Adjusted
EBITDA
|
$
114.2
|
|
$
79.5
|
Paper
Packaging & Services
|
|
|
|
Operating
profit
|
38.3
|
|
14.3
|
Less: Non-cash pension
settlement charges
|
—
|
|
8.5
|
Less: Other expense,
net
|
0.1
|
|
0.1
|
Plus: Depreciation and
amortization expense
|
38.0
|
|
37.2
|
EBITDA
|
$
76.2
|
|
$
42.9
|
Plus: Restructuring
charges
|
1.4
|
|
0.3
|
Plus: Integration
related costs
|
1.6
|
|
2.0
|
Plus: Non-cash pension
settlement charges
|
—
|
|
8.5
|
Plus: Incremental
COVID-19 costs, net
|
—
|
|
0.3
|
Plus: Loss on disposal
of properties, plants, equipment and businesses, net
|
1.3
|
|
2.1
|
Adjusted
EBITDA
|
$
80.5
|
|
$
56.1
|
Land
Management
|
|
|
|
Operating
profit
|
2.7
|
|
1.7
|
Plus: Depreciation,
depletion and amortization expense
|
0.8
|
|
1.1
|
EBITDA
|
$
3.5
|
|
$
2.8
|
Plus: (Gain) loss on
disposal of properties, plants, equipment and businesses,
net
|
(1.4)
|
|
0.1
|
Adjusted
EBITDA
|
$
2.1
|
|
$
2.9
|
Consolidated
EBITDA
|
$
130.7
|
|
$
121.5
|
Consolidated Adjusted
EBITDA
|
$
196.8
|
|
$
138.5
|
|
|
(11) Adjusted EBITDA is defined as net income, plus
interest expense, net, plus income tax expense, plus depreciation,
depletion and amortization expense, plus restructuring charges,
plus integration related costs, plus non-cash asset impairment
charges, plus non-cash pension settlement charges, plus incremental
COVID-19 costs, net, plus (gain) loss on disposal of properties,
plants, equipment and businesses, net. However, because the Company
does not calculate net income by segment, this table calculates
adjusted EBITDA by segment with reference to operating profit by
segment, which, as demonstrated in the table of consolidated
adjusted EBITDA, is another method to achieve the same
result.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
ADJUSTED FREE CASH
FLOW(12)
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
(in
millions)
|
2022
|
|
2021
|
Net cash provided
by operating activities
|
$
22.4
|
|
$
11.5
|
Cash paid for
purchases of properties, plants and equipment
|
(44.5)
|
|
(27.4)
|
Free cash
flow
|
$
(22.1)
|
|
$
(15.9)
|
Cash paid for
integration related costs
|
1.6
|
|
2.0
|
Cash paid for
incremental COVID-19 costs, net
|
—
|
|
0.6
|
Cash paid for
integration related ERP systems
|
1.7
|
|
1.8
|
Adjusted free cash
flow
|
$
(18.8)
|
|
$
(11.5)
|
|
|
(12) Adjusted free cash flow is defined as net cash
provided by operating activities, less cash paid for purchases of
properties, plants and equipment, plus cash paid for integration
related costs, plus cash paid for incremental COVID-19 costs, net,
plus cash paid for integration related ERP systems.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
NET INCOME, CLASS
A EARNINGS PER SHARE AND TAX RATE BEFORE ADJUSTMENTS
|
UNAUDITED
|
|
(in millions,
except for per share amounts)
|
Income before
Income Tax
(Benefit) Expense
and Equity
Earnings of
Unconsolidated
Affiliates, net
|
|
Income
Tax
(Benefit)
Expense
|
|
Equity
Earnings
|
|
Non-
Controlling
Interest
|
|
Net
Income
(Loss)
Attributable
to
Greif, Inc.
|
|
Diluted
Class A
Earnings
Per Share
|
|
Tax
Rate
|
Three months ended
January 31, 2022
|
$
52.9
|
|
$
35.6
|
|
$
(1.3)
|
|
$
8.3
|
|
$
10.3
|
|
$
0.18
|
|
67.3%
|
Restructuring
charges
|
3.5
|
|
0.8
|
|
—
|
|
—
|
|
2.7
|
|
0.05
|
|
|
Integration related
costs
|
1.6
|
|
0.4
|
|
—
|
|
—
|
|
1.2
|
|
0.02
|
|
|
Non-cash asset
impairment charges
|
62.4
|
|
—
|
|
—
|
|
—
|
|
62.4
|
|
1.05
|
|
|
Gain on disposal of
properties, plants, equipment and businesses, net
|
(1.4)
|
|
(0.3)
|
|
—
|
|
(0.1)
|
|
(1.0)
|
|
(0.02)
|
|
|
Excluding
Adjustments
|
$
119.0
|
|
$
36.5
|
|
$
(1.3)
|
|
$
8.2
|
|
$
75.6
|
|
$
1.28
|
|
30.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
January 31, 2021
|
$
36.3
|
|
$
6.1
|
|
$
(0.7)
|
|
$
7.5
|
|
$
23.4
|
|
$
0.40
|
|
16.8%
|
Restructuring
charges
|
3.1
|
|
0.8
|
|
—
|
|
—
|
|
2.3
|
|
0.04
|
|
|
Integration related
costs
|
2.0
|
|
0.5
|
|
—
|
|
—
|
|
1.5
|
|
0.03
|
|
|
Non-cash asset
impairment charges
|
1.3
|
|
0.4
|
|
—
|
|
—
|
|
0.9
|
|
0.02
|
|
|
Non-cash pension
settlement charges
|
8.5
|
|
2.1
|
|
—
|
|
—
|
|
6.4
|
|
0.09
|
|
|
Incremental COVID-19
costs, net
|
0.6
|
|
0.1
|
|
—
|
|
0.1
|
|
0.4
|
|
0.01
|
|
|
Loss on disposal of
properties, plants, equipment and businesses, net
|
1.5
|
|
0.5
|
|
—
|
|
—
|
|
1.0
|
|
0.02
|
|
|
Excluding
Adjustments
|
$
53.3
|
|
$
10.5
|
|
$
(0.7)
|
|
$
7.6
|
|
$
35.9
|
|
$
0.61
|
|
19.7%
|
|
The impact of income
tax expense and non-controlling interest on each adjustment is
calculated based on tax rates and ownership percentages specific to
each applicable entity.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
NET SALES TO NET
SALES EXCLUDING THE IMPACT OF
|
CURRENCY
TRANSLATION
|
UNAUDITED
|
|
|
Three months ended
January 31,
|
|
|
|
|
(in
millions)
|
2022
|
|
2021
|
|
Increase
(Decrease) in
Net Sales
($)
|
|
Increase
(Decrease) in
Net Sales
(%)
|
Consolidated
|
|
|
|
|
|
|
|
Net Sales
|
$
1,564.3
|
|
$
1,146.5
|
|
$
417.8
|
|
36.4%
|
Currency
Translation
|
25.2
|
|
N/A
|
|
|
|
|
Net Sales Excluding
the Impact of Currency Translation
|
$
1,589.5
|
|
$
1,146.5
|
|
$
443.0
|
|
38.6%
|
Global Industrial
Packaging
|
|
|
|
|
|
|
|
Net Sales
|
$
949.1
|
|
$
659.3
|
|
$
289.8
|
|
44.0%
|
Currency
Translation
|
25.4
|
|
N/A
|
|
|
|
|
Net Sales Excluding
the Impact of Currency Translation
|
$
974.5
|
|
$
659.3
|
|
$
315.2
|
|
47.8%
|
Paper
Packaging & Services
|
|
|
|
|
|
|
|
Net Sales
|
$
610.0
|
|
$
480.9
|
|
$
129.1
|
|
26.8%
|
Currency
Translation
|
(0.2)
|
|
N/A
|
|
|
|
|
Net Sales Excluding
the Impact of Currency Translation
|
$
609.8
|
|
$
480.9
|
|
$
128.9
|
|
26.8%
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
NET
DEBT
|
UNAUDITED
|
|
(in
millions)
|
January 31,
2022
|
|
January 31,
2021
|
Total Debt
|
$
2,296.8
|
|
$
2,539.4
|
Cash and cash
equivalents
|
(119.7)
|
|
(101.4)
|
Net
Debt
|
$
2,177.1
|
|
$
2,438.0
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
GAAP TO NON-GAAP
RECONCILIATION
|
LEVERAGE
RATIO
|
UNAUDITED
|
|
Trailing Twelve
Month Credit Agreement EBITDA
(in
millions)
|
Trailing
Twelve
Months Ended
1/31/2022
|
Trailing
Twelve
Months Ended
10/31/2021
|
Trailing
Twelve
Months Ended
1/31/2021
|
Net income
|
$
400.9
|
$
413.2
|
$
119.1
|
Plus: Interest expense,
net
|
84.6
|
92.7
|
110.3
|
Plus: Income tax
expense
|
99.1
|
69.6
|
58.0
|
Plus: Depreciation,
depletion and amortization expense
|
234.5
|
234.4
|
240.5
|
EBITDA
|
$
819.1
|
$
809.9
|
$
527.9
|
Plus: Restructuring
charges
|
23.5
|
23.1
|
38.5
|
Plus: Integration
related costs
|
8.7
|
9.1
|
13.9
|
Plus: Non-cash asset
impairment charges
|
70.0
|
8.9
|
19.7
|
Plus: Non-cash pension
settlement charges
|
0.6
|
9.1
|
8.9
|
Plus: Incremental
COVID-19 costs, net
|
2.7
|
3.3
|
3.2
|
Plus: (Gain) loss on
disposal of properties, plants, equipment, and businesses,
net
|
(6.4)
|
(3.5)
|
21.6
|
Plus: Timberland gains,
net
|
$
(95.7)
|
$
(95.7)
|
$
—
|
Adjusted
EBITDA
|
$
822.5
|
$
764.2
|
$
633.7
|
Credit Agreement
adjustments to EBITDA(13)
|
33.1
|
33.6
|
(5.2)
|
Credit Agreement
EBITDA
|
$
855.6
|
$
797.8
|
$
628.5
|
|
|
|
|
Adjusted Net
Debt
(in
millions)
|
For the Period
Ended
1/31/2022
|
For the Period
Ended
10/31/2021
|
For the Period
Ended
1/31/2021
|
Total debt
|
$
2,296.8
|
$
2,225.6
|
$
2,539.4
|
Cash and cash
equivalents
|
(119.7)
|
(124.6)
|
(101.4)
|
Net debt
|
$
2,177.1
|
$
2,101.0
|
$
2,438.0
|
Credit Agreement
adjustments to debt(14)
|
(130.7)
|
(115.9)
|
(55.2)
|
Adjusted net
debt
|
$
2,046.4
|
$
1,985.1
|
$
2,382.8
|
|
|
|
|
Leverage
Ratio
|
2.39x
|
2.49x
|
3.79x
|
|
|
(13) Adjustments to EBITDA are specified by the 2019
Credit Agreement and include certain timberland gains, equity
earnings of unconsolidated affiliates, net of tax, certain
acquisition savings, deferred financing costs, capitalized
interest, and other items.
|
(14) Adjustments to net debt are specified by the 2019
Credit Agreement and include the European accounts receivable
program, letters of credit, deferred financing costs, and
derivative balances.
|
GREIF, INC. AND
SUBSIDIARY COMPANIES
|
PROJECTED 2022
GUIDANCE RECONCILIATION
|
ADJUSTED FREE CASH
FLOW
|
UNAUDITED
|
|
|
Fiscal 2022
Guidance Range
|
(in
millions)
|
Scenario
1
|
|
Scenario
2
|
Net cash provided
by operating activities
|
$
518.0
|
|
$
594.0
|
Cash paid for
purchases of properties, plants and equipment
|
(150.0)
|
|
(170.0)
|
Free cash
flow
|
$
368.0
|
|
$
424.0
|
Cash paid for
integration related costs
|
6.0
|
|
8.0
|
Cash paid for
integration related ERP systems
|
6.0
|
|
8.0
|
Adjusted free cash
flow
|
$
380.0
|
|
$
440.0
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/greif-reports-first-quarter-2022-results-301494450.html
SOURCE Greif, Inc.