Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to COMMISSION FILE NUMBER: 001-33988 Graphic Packaging Holding Company (Exact name of registrant as specified in its charter) (State or other jurisdiction ...

First Quarter 2022 Earnings Call April 26, 2022 Michael P. Doss President and Chief Executive Officer Stephen R. Scherger Executive Vice President and Chief Financial Officer Inspired Packaging. A World of Difference. FORWARD LOOKING STATEMENTS 2 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Any statements of the Company's expectations in these slides, including, but not limited to, guidance regarding synergies, net sales and European sales, EBITDA and cash flow (and the components thereof), adj ...

Part I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) The company is a global leader in sustainable fiber-based packaging solutions, holding strong market positions in CRB, CUK, and SBS paperboard - The company is a leading provider of sustainable, fiber-based packaging solutions, holding leading market positions in **CRB, CUK, and SBS paperboard**[14](index=14&type=chunk) - International Paper Company (IP) fully exited its ownership interest in the company's subsidiary, GPIP, as of May 21, 2021[17](index=17&type=chunk) - Operations are structured into three reportable segments: Paperboard Mills, Americas Paperboard Packaging, and Europe Paperboard Packaging[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - As of December 31, 2021, the company employed approximately **25,000 individuals** globally, with **32%** represented by labor unions or works councils[60](index=60&type=chunk) [Acquisitions, Closures, and Dispositions](index=5&type=section&id=Acquisitions,%20Closures,%20and%20Dispositions) The company actively pursues strategic acquisitions, completing two major deals in 2021 while also undertaking facility closures in 2020 - Acquired Americraft Carton, Inc. on July 1, 2021, adding **seven converting plants** in the U.S[20](index=20&type=chunk) - Acquired AR Packaging Group AB on November 1, 2021, adding **30 converting plants** across 13 countries in Europe[20](index=20&type=chunk) - In 2020, the company closed its White Pigeon, Michigan CRB mill and shut down a containerboard machine in West Monroe, Louisiana[20](index=20&type=chunk) [Products and Operations](index=6&type=section&id=Products%20and%20Operations) The company produces a range of paperboard products including CUK, SBS, and CRB at its eight North American mills, with a significant portion consumed internally 2021 Net Tons Produced by Paperboard Mill | Location | Product | of Machines | 2021 Net Tons Produced | | :--- | :--- | :--- | :--- | | West Monroe, LA | CUK | 2 | 931,713 | | Macon, GA | CUK | 2 | 738,981 | | Texarkana, TX | SBS | 2 | 583,910 | | Augusta, GA | SBS | 2 | 585,164 | | Kalamazoo, MI | CRB | 2 | 508,546 | | Battle Creek, MI | CRB | 2 | 219,058 | | Middletown, OH | CRB | 1 | 178,863 | | East Angus, Québec | CRB | 1 | 99,568 | - In 2021, approximately **72%** of the company's combined mill production of CRB, CUK, and SBS was consumed internally by its converting operations[35](index=35&type=chunk) [Sales, Marketing and Competition](index=8&type=section&id=Sales,%20Marketing%20and%20Competition) The company markets products to multinational consumer companies, facing strong competition from other paperboard manufacturers and substitute materials - No single customer accounted for **10% or more** of net sales in 2019, 2020, or 2021[43](index=43&type=chunk) - The company's primary competitor in CUK production is WestRock Company, and it competes with numerous producers of CRB and SBS in non-beverage packaging[44](index=44&type=chunk)[45](index=45&type=chunk) [Item 1A. Risk Factors](index=12&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant industry, operational, financial, and regulatory risks, including raw material inflation, acquisition integration challenges, substantial debt, and stringent environmental laws - Industry Risks: The company is exposed to inflation in raw materials (fiber, chemicals), energy, and transportation costs, which may not be passed on to customers, alongside risks from changing consumer preferences and competition from other materials[70](index=70&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) - Operational Risks: Global events like the COVID-19 pandemic can disrupt operations and supply chains, while growth depends on successfully integrating acquisitions, and cybersecurity threats or skilled workforce shortages pose additional risks[75](index=75&type=chunk)[76](index=76&type=chunk)[77](index=77&type=chunk) - Financial Risks: As of December 31, 2021, the company had an aggregate principal debt of **$5,831 million**, requiring significant cash flow for service payments and potentially restricting future financing and operational flexibility[84](index=84&type=chunk)[85](index=85&type=chunk) - Legal and Regulatory Risks: The company is subject to extensive environmental, health, and safety regulations, particularly those related to GHG emissions, which are becoming more stringent and could result in significant compliance costs[88](index=88&type=chunk) [Item 2. Properties](index=15&type=section&id=Item%202.%20Properties) The company operates eight paperboard mills in North America producing SBS, CRB, and CUK, complemented by a global network of converting plants - The company operates eight paperboard mills located in Augusta, GA (SBS); Battle Creek, MI (CRB); East Angus, Québec (CRB); Kalamazoo, MI (CRB); Macon, GA (CUK); Middletown, OH (CRB); Texarkana, TX (SBS); and West Monroe, LA (CUK)[92](index=92&type=chunk) - The company operates a global network of converting plants across North America, South America, Europe, and the Asia-Pacific region[93](index=93&type=chunk) [Executive Officers of the Registrant](index=19&type=section&id=EXECUTIVE%20OFFICERS%20OF%20THE%20REGISTRANT) This section details the biographical information for the company's executive officers, including the President and CEO, and the Executive Vice President and CFO - Michael P. Doss serves as the President and Chief Executive Officer[100](index=100&type=chunk) - Stephen R. Scherger serves as the Executive Vice President and Chief Financial Officer[102](index=102&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE, with **$87 million** in dividends paid in 2021 and no share repurchases, alongside significant debt financing activities - The company paid cash dividends of **$87 million** in 2021 and **$85 million** in 2020[111](index=111&type=chunk) - No shares of common stock were repurchased during the year ended December 31, 2021[113](index=113&type=chunk) Stock Performance Comparison (2016-2021) | | 12/31/2016 | 12/31/2017 | 12/31/2018 | 12/31/2019 | 12/31/2020 | 12/31/2021 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Graphic Packaging Holding Company | $100.00 | $126.58 | $89.12 | $142.43 | $148.05 | $173.19 | | S&P 500 Stock Index | $100.00 | $121.83 | $116.49 | $153.17 | $181.35 | $233.41 | | Dow Jones U.S. Container & Packaging Index | $100.00 | $119.02 | $97.06 | $124.80 | $151.18 | $167.76 | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net Sales increased **9%** to **$7,156 million** in 2021, while Income from Operations decreased **22%** to **$407 million** due to significant cost inflation and acquisition charges Consolidated Financial Highlights (2019-2021) | In millions | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Net Sales | $7,156 | $6,560 | $6,160 | | Income from Operations | $407 | $524 | $534 | | Net Income | $216 | $203 | $278 | - Net Sales in 2021 increased by **$596 million (9%)** year-over-year, driven by acquisitions (**$344 million**), higher pricing, organic growth, and favorable foreign exchange[144](index=144&type=chunk) - Income from Operations in 2021 decreased by **$117 million (22%)** year-over-year, negatively impacted by cost inflation of **$386 million**, **$21 million** in costs from Winter Storm Uri, and higher acquisition-related charges[145](index=145&type=chunk) - Cost inflation in 2021 totaled **$386 million**, driven by higher commodity costs (**$330 million**), labor and benefits (**$47 million**), and other net costs (**$9 million**)[132](index=132&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Net Sales increased **9%** to **$7,156 million** in 2021, while Income from Operations decreased **22%** to **$407 million**, primarily due to **$386 million** in cost inflation Change in Net Sales (2020 vs. 2021) | In millions | 2020 | Price | Volume/Mix | Foreign Exchange | 2021 | Increase | Percent Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Consolidated | $6,560 | $150 | $379 | $67 | $7,156 | $596 | 9% | Change in Income from Operations (2020 vs. 2021) | In millions | 2020 | Price | Volume/Mix | Inflation | Foreign Exchange | Other | 2021 | Decrease | Percent Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Consolidated | $524 | $150 | $35 | $(386) | $1 | $83 | $407 | $(117) | (22)% | - The effective tax rate was **25.7%** in 2021, compared to **17.0%** in 2020, primarily due to discrete tax items related to UK tax rate increases and the tax effects of IP's exit from the partnership[150](index=150&type=chunk)[151](index=151&type=chunk) [Segment Reporting](index=29&type=section&id=Segment%20Reporting) In 2021, Americas Paperboard Packaging saw increased sales but lower operating income, while Europe Paperboard Packaging and Paperboard Mills improved, the latter reducing its operating loss Segment Net Sales and Income from Operations (2019-2021) | In millions | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | **NET SALES:** | | | | | Paperboard Mills | $1,007 | $988 | $1,095 | | Americas Paperboard Packaging | $4,996 | $4,650 | $4,234 | | Europe Paperboard Packaging | $992 | $765 | $689 | | **(LOSS) INCOME FROM OPERATIONS:** | | | | | Paperboard Mills | $(10) | $(110) | $33 | | Americas Paperboard Packaging | $456 | $639 | $478 | | Europe Paperboard Packaging | $82 | $66 | $60 | [Financial Condition, Liquidity and Capital Resources](index=31&type=section&id=Financial%20Condition,%20Liquidity%20and%20Capital%20Resources) Net cash from operating activities was **$609 million** in 2021, with **$2,392 million** used in investing activities and **$1,778 million** provided by financing, maintaining debt covenant compliance Summary of Cash Flows (2020 vs. 2021) | In millions | 2021 | 2020 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $609 | $825 | | Net Cash Used in Investing Activities | $(2,392) | $(648) | | Net Cash Provided by (Used in) Financing Activities | $1,778 | $(152) | - Capital spending was **$802 million** in 2021, up from **$646 million** in 2020[171](index=171&type=chunk) - At December 31, 2021, the company was in compliance with its debt covenants, with a Consolidated Total Leverage Ratio of **4.39 to 1.00** (against a maximum of **5.00 to 1.00**) and a Consolidated Interest Expense Ratio of **10.85 to 1.00** (against a minimum of **3.00 to 1.00**)[179](index=179&type=chunk) [Business Outlook](index=38&type=section&id=Business%20Outlook) For 2022, the company projects total capital investment between **$440 million** and **$460 million**, with depreciation and amortization expected at **$580 million** - Total capital investment for 2022 is expected to be in the range of **$440 million** to **$460 million**[211](index=211&type=chunk) - 2022 depreciation and amortization expense is projected to be approximately **$580 million**[212](index=212&type=chunk) [Item 7A. Quantitative and Qualitative Disclosure About Market Risk](index=39&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) The company manages market risks from interest rates, foreign currency, and commodity prices using derivative instruments like swaps and forward contracts for hedging purposes - The company uses interest rate swaps, forward exchange contracts, and natural gas swaps to hedge against market risks[213](index=213&type=chunk)[214](index=214&type=chunk)[220](index=220&type=chunk)[224](index=224&type=chunk) - At December 31, 2021, the company had active interest rate swap agreements with a notional amount of **$200 million** expiring in January 2022[214](index=214&type=chunk) - In connection with the AR Packaging acquisition, the company entered into deal contingent foreign exchange forward contracts to hedge **€700 million** of the acquisition price, which resulted in unrealized losses recognized in 2021[223](index=223&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=41&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for 2021, including Statements of Operations, Balance Sheets, and Cash Flows, with detailed accompanying notes [Consolidated Statements of Operations](index=42&type=section&id=Consolidated%20Statements%20of%20Operations) In 2021, Net Sales reached **$7,156 million**, Income from Operations was **$407 million**, and Net Income Attributable to GPHC was **$204 million**, with diluted EPS of **$0.68** Consolidated Statements of Operations (in millions, except per share) | | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Net Sales | $7,156 | $6,560 | $6,160 | | Cost of Sales | $6,085 | $5,460 | $5,068 | | Income from Operations | $407 | $524 | $534 | | Net Income | $216 | $203 | $278 | | Net Income Attributable to GPHC | $204 | $167 | $207 | | Diluted EPS Attributable to GPHC | $0.68 | $0.60 | $0.70 | [Consolidated Balance Sheets](index=44&type=section&id=Consolidated%20Balance%20Sheets) As of December 31, 2021, Total Assets increased to **$10,457 million**, Total Liabilities to **$8,564 million** (including **$5,515 million** Long-Term Debt), and Total Equity to **$1,893 million** Consolidated Balance Sheets (in millions) | | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | **ASSETS** | | | | Total Current Assets | $2,502 | $2,020 | | Property, Plant and Equipment, Net | $4,677 | $3,560 | | Goodwill | $2,015 | $1,478 | | **Total Assets** | **$10,457** | **$7,805** | | **LIABILITIES & EQUITY** | | | | Total Current Liabilities | $2,049 | $1,856 | | Long-Term Debt | $5,515 | $3,147 | | **Total Liabilities** | **$8,564** | **$5,965** | | **Total Equity** | **$1,893** | **$1,840** | [Consolidated Statements of Cash Flows](index=46&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) In 2021, net cash from operating activities was **$609 million**, investing activities used **$2,392 million** (mainly for acquisitions), and financing activities provided **$1,778 million** Consolidated Statements of Cash Flows (in millions) | | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $609 | $825 | $666 | | Net Cash Used in Investing Activities | $(2,392) | $(648) | $(225) | | Net Cash Provided by (Used in) Financing Activities | $1,778 | $(152) | $(361) | | Net (Decrease) Increase in Cash | $(7) | $26 | $82 | [Note 4. Business Combinations](index=56&type=section&id=Note%204.%20Business%20Combinations) In 2021, the company completed two major acquisitions, Americraft for **$292 million** and AR Packaging for **$1,412 million**, significantly impacting goodwill and pro forma revenue - Acquired Americraft on July 1, 2021, for a purchase price of **$292 million**, resulting in **$68 million** of goodwill[312](index=312&type=chunk)[316](index=316&type=chunk) - Acquired AR Packaging on November 1, 2021, for total cash consideration of **$1,412 million** (net of cash), resulting in **$475 million** of goodwill and a **$439 million** customer relationships intangible asset[318](index=318&type=chunk)[321](index=321&type=chunk)[322](index=322&type=chunk) Pro Forma Revenue and Net Income (unaudited) | In millions | Pro Forma Twelve Months Ended Dec 31, 2021 | Pro Forma Twelve Months Ended Dec 31, 2020 | | :--- | :--- | :--- | | Revenue | $8,096 | $7,562 | | Net Income (Loss) | $293 | $94 | [Item 9A. Controls and Procedures](index=91&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2021, excluding recent acquisitions - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2021[508](index=508&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2021, with the assessment excluding the internal controls of the 2021 acquisitions of Americraft and AR Packaging[510](index=510&type=chunk)[511](index=511&type=chunk) Part III [Items 10-14](index=92&type=section&id=Items%2010-14) Information for Items 10 through 14, covering governance, compensation, and related matters, is incorporated by reference from the 2022 Proxy Statement - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the registrant's definitive Proxy Statement for the 2022 Annual Meeting of Stockholders[517](index=517&type=chunk)[518](index=518&type=chunk)[519](index=519&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=93&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all financial statements, schedules, and exhibits filed with the Form 10-K, including corporate governance documents and material contracts - This item lists all financial statements and exhibits filed with the Form 10-K, including debt agreements, compensation plans, and certifications[524](index=524&type=chunk)[525](index=525&type=chunk)

Financial Data and Key Metrics Changes - Net sales increased by 5% or $84 million year-over-year to $1.8 billion, driven by higher pricing and acquisitions [23] - Adjusted EBITDA grew by 14% to $284 million, resulting in an improved adjusted EBITDA margin of 15.9% [23] - Adjusted earnings per share increased by 31% to $0.34 [23] - The company experienced approximately $25 million in delayed sales due to supply chain and labor market constraints [10][26] Business Line Data and Key Metrics Changes - The Food Service business grew by 11% year-over-year, while food, beverage, and consumer sales improved by 3% including acquisitions [25] - Organic sales growth was slightly down in Q3, but the company expects to deliver organic sales growth at the high end of its 100 to 200 basis points target for 2021 [9][20] Market Data and Key Metrics Changes - The company noted strong demand for fiber-based consumer packaging solutions, with operating rates for CRB at 95% and SBS at 96% [27] - Industry inventory levels continued to decline, with backlogs elevated at over eight weeks across the UK and CRB [28] Company Strategy and Development Direction - The company is focused on capturing growth opportunities in sustainable packaging solutions, aligning with its Vision 2025 goals [7][11] - The acquisition of AR Packaging is expected to enhance the company's global reach and service offerings, with a closing date set for November 1, 2021 [14][15] - The K2 CRB machine project is on track for startup in Q4, which is a significant investment in paperboard capabilities [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by unprecedented inflation and supply chain bottlenecks but remains committed to meeting Vision 2025 goals [10][11] - The company expects to recover $170 million of price cost dislocation in 2022, with a projected adjusted EBITDA of $1.4 billion plus [31][32] Other Important Information - The company has implemented approximately $650 million in pricing initiatives to offset commodity input cost inflation over 2021 and 2022 [12][18] - Global liquidity was reported at $1.8 billion at the end of Q3, expected to remain substantial post-acquisition [29] Q&A Session Summary Question: Update on inflation impact for 2022 - Management updated the inflation midpoint to $310 million for 2021, with rollover effects estimated at $100 million to $125 million for 2022 [37] Question: Confidence in achieving pricing targets - Management expressed high confidence in achieving $510 million in pricing for 2022, driven by multi-year contracts [40] Question: Current inflation dynamics and potential volume risks - Management noted that inflation has accelerated but expects to manage it through pricing actions, with lightweighting seen as an opportunity rather than a threat [49] Question: Volume recovery expectations - Management indicated that supply chain and labor issues are expected to moderate, allowing for volume recovery in Q4 [56] Question: Kalamazoo project community reception - Management stated that the Kalamazoo project is on track, with normal community concerns being addressed [62]

Graphic Packaging Holding Company (NYSE:GPK) Q2 2021 Earnings Conference Call July 27, 2021 10:00 AM ET Company Participants Melanie Skijus - Vice President, Investor Relations Mike Doss - Chief Executive Officer Steve Scherger - Executive Vice President and Chief Financial Officer Conference Call Participants George Staphos - Bank of America Matt Krueger - Robert W. Baird Neel Kumar - Morgan Stanley Mark Connelly - Stephens Inc. Mark Weintraub - Seaport Research Mark Wilde - Bank of Montreal Gabe Hajde - W ...

SECOND QUARTER 2021 EARNINGS CALL July 27, 2021 Michael P. Doss President and Chief Executive Officer Stephen R. Scherger Executive Vice President and Chief Financial Officer Inspired Packaging. A World of Difference. FORWARD LOOKING STATEMENTS CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Any statements of the Company's expectations in these slides, including but not limited to the intent and timing to acquire AR Packaging, projected organic sales, European sales, and second half Adjusted EBITD ...

Graphic Packaging Holding Company (NYSE:GPK) Q1 2021 Earnings Conference Call April 27, 2021 10:00 AM ET Company Participants Melanie Skijus - Vice President of Investor Relations Mike Doss - Chief Executive Officer Steve Scherger - Executive Vice President and CFO Conference Call Participants Mark Connelly - Stephens. George Staphos - Bank of America Mark Wilde - Bank of Montreal Gabe Hajde - Wells Fargo Adam Samuelson - Goldman Sachs Mark Weintraub - Seaport Global Anthony Pettinari - Citi Matt Krueger - ...

First Quarter 2021 Earnings Call April 27, 2021 Michael P. Doss President and Chief Executive Officer Stephen R. Scherger Executive Vice President and Chief Financial Officer Inspired Packaging. A World of Difference. FORWARD LOOKING STATEMENTS CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Any statements of the Company's expectations in these slides, including but not limited to the intent to acquire Americraft Carton, Inc. and expected synergies from such acquisition, projected organic sales an ...

Graphic Packaging Holding Co (NYSE:GPK) Q4 2020 Earnings Conference Call February 2, 2021 10:00 AM ET Company Participants Melanie Skijus - VP, IR Michael Doss - President, CEO & Director Stephen Scherger - EVP & CFO Conference Call Participants Mark Wilde - BMO Capital Markets Mark Connelly - Stephens Inc. George Staphos - Bank of America Merrill Lynch Ghansham Panjabi - Robert W. Baird & Co. Anthony Pettinari - Citigroup Kyle White - Deutsche Bank Adam Josephson - KeyBanc Capital Markets Arun Viswanathan ...

Fourth Quarter 2020 Earnings Call Packaging February 2, 2021 Michael P. Doss President and Chief Executive Officer Stephen R. Scherger Executive Vice President and Chief Financial Officer Inspired Packaging. A World of Difference. FORWARD LOOKING STATEMENTS 2 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Any statements of the Company's expectations in these slides, including but not limited to projected organic sales and EBITDA growth, timing of the new CRB machine start-up in Kalamazoo, Michiga ...