ATLANTA, April 21, 2020 - Graphic Packaging Holding Company Reports First Quarter 2020 Results; Actively Keeping Employees Safe and Serving Customers in Current COVID-19 Environment; Accelerating Strategic Actions
Q1 2020 Highlights
- Net Sales were $1,599.1 million versus $1,505.9 million in the prior year period.
- Net Income was ($12.7) million versus $57.9 million in the prior year period; loss includes the previously announced net $89.7 million non-cash charge related to the settlement of a U.S. pension plan.
- Earnings per Diluted Share were ($0.04) versus $0.19 in the prior year period.
- Adjusted Earnings per Diluted Share were $0.31 versus $0.21 in the prior year period.
- Adjusted EBITDA was $294.8 million versus $259.7 million in the prior year period, driven by positive net organic volume growth of 5% and solid productivity.
- Global liquidity was $1,473.9 million at quarter end; issued $450.0 million of 3.5% senior notes on 2/21/2020.
- Repurchased $119.4 million in common shares during the quarter; delivered $396.1 million to stakeholders in share repurchases, dividends, distributions and partnership redemptions.
Strategic Actions and Announcements
- Actively keeping employees safe and serving customers as an essential business in the food, beverage and consumer products supply chain; providing $5 million in one-time payments to front-line production employees.
- Donating a total of $500,000 to local food banks in communities where we operate globally; supporting Company philanthropic pillar of "putting food on the table".
- Board of Directors has reviewed the current dividend policy and remains committed to the existing return of capital to stakeholders through dividends and distributions.
- Successfully completed and began integration of a converting facility acquired from Quad/Graphics, Inc. and seven converting facilities acquired from Greif, Inc.
- Announcing the closure of the 70,000 ton White Pigeon, Michigan Coated Recycled Board (CRB) mill effective June 30, 2020 due to the operational strength of the Company's overall CRB mill network and a CRB supply agreement with Greif, Inc.
- Announcing the closure of the 120,000 ton West Monroe, Louisiana PM1 containerboard machine effective June 30, 2020 reflecting the Company's long-term confidence in the strength of the Coated Unbleached Kraft (CUK) global beverage packaging platform.
- Delayed the significant planned maintenance outage at the West Monroe, Louisiana mill from Q2 to Q3 due to increased near-term demand for CUK and contractor work-related implications associated with COVID-19.
- Suspending annual Adjusted EBITDA and Cash Flow guidance allowing time to assess potential shifts in consumer behavior and spending patterns related to the COVID-19 crisis.
Graphic Packaging Holding Company (NYSE: GPK), (the "Company"), a leading provider of packaging solutions to food, beverage, foodservice, and other consumer products companies, today reported a Net Loss for first quarter 2020 of $12.7 million, or a net loss per share of $0.04, based upon 288.9 million weighted average diluted shares. This compares to first quarter 2019 Net Income of $57.9 million, or $0.19 per share, based upon 298.2 million weighted average diluted shares.
First quarter 2020 Net Income was negatively impacted by a net $103.9 million of special charges including a net $89.7 million non-cash charge related to the settlement of a U.S. pension plan. The charges are detailed in the Reconciliation of Non-GAAP Financial Measures table attached. When adjusting for these charges, Adjusted Net Income for the first quarter of 2020 was $91.2 million, or $0.31 per diluted share. This compares to first quarter 2019 Adjusted Net Income of $61.7 million or $0.21 per diluted share.
Source: Graphic Packaging