Executive Summary & Highlights This section provides an overview of management's commentary, key financial highlights, and significant business updates for the quarter [Management Commentary](index=1&type=section&id=1.1.%20Management%20Commentary) Management highlights Protective segment volume progress, Q2 outperformance, accelerated productivity, and maintained full-year guidance - CEO Dustin Semach noted that the Protective turnaround will be non-linear, but Q2 2025 marked progress with the **best volume performance since Q4 2021** and **industrial portfolio volume growth**[4](index=4&type=chunk) - Market pressures are accelerating, primarily in North America, influenced by global trade policies and shifting consumer spending patterns[4](index=4&type=chunk) - Interim CFO Roni Johnson stated that Q2 results exceeded expectations across all metrics despite increasing market headwinds, and productivity initiatives are being accelerated to improve operating leverage[4](index=4&type=chunk) - The company is maintaining its full-year guidance range, anticipating more visibility on global trade policies and consumer buying patterns in Q3[4](index=4&type=chunk) [Q2 2025 Financial Highlights (Summary Table)](index=1&type=section&id=1.2.%20Q2%202025%20Financial%20Highlights%20(Summary%20Table)) Q2 2025 financial highlights show slight GAAP net sales and earnings declines, with Adjusted EBITDA and EPS growth | ($ millions, except per share data) | Second Quarter 2025 | Second Quarter 2024 | Reported △% | Constant currency △% | | :-------------------------------- | :------------------ | :------------------ | :---------- | :------------------- | | **GAAP Results** | | | | | | Net Sales | $1,335 | $1,345 | (0.8)% | (1.3)% | | Net Earnings | $94 | $98 | (3.7)% | | | Diluted EPS | $0.64 | $0.67 | (4.5)% | | | Cash Flow from Operations (YTD) | $168 | $313 | (46.2)% | | | **Non-GAAP Results** | | | | | | Adjusted EBITDA | $293 | $285 | 2.5% | 3.4% | | Adjusted Net Earnings | $132 | $121 | 9.3% | 11.2% | | Adjusted Diluted EPS | $0.89 | $0.83 | 7.2% | 9.6% | | Free Cash Flow (YTD) | $81 | $207 | (60.9)% | | [Key Business Updates](index=1&type=section&id=1.3.%20Key%20Business%20Updates) Key updates include new CFO, Protective volume stabilization, flat Food sales, and focus on margin, EPS, debt reduction - Kristen Actis-Grande is joining Sealed Air as Chief Financial Officer[5](index=5&type=chunk) - Protective volumes stabilized in the quarter, with the industrial portfolio inflecting to **volume growth** due to ongoing transformation efforts[5](index=5&type=chunk) - Food sales were **flat**, as favorable pricing was offset by softer volumes driven by market pressure in the North American business[5](index=5&type=chunk) - Margin expansion and **Adjusted EPS growth** were achieved through improved operating leverage and continued business optimization[5](index=5&type=chunk) - The company maintained its financial outlook for 2025, with an improved FX outlook being offset by volume weakness in North America[5](index=5&type=chunk) Detailed Financial Performance - Q2 2025 This section provides an in-depth analysis of the company's consolidated financial results, segment performance, and cash flow dynamics for the second quarter of 2025 [Consolidated Financial Results](index=2&type=section&id=2.1.%20Consolidated%20Financial%20Results) Consolidated financial results for Q2 2025 show a slight decrease in net sales, a decline in GAAP net earnings due to higher Special Items expense, but an increase in Adjusted EBITDA and Adjusted EPS driven by productivity benefits and lower interest expense - Net sales were **$1.34 billion**, decreasing less than **1%** as reported (**0.8%**) and **1%** on a constant currency basis. Volumes decreased by **2%** (**$23 million**), while price increased by less than **1%** (**$6 million**)[6](index=6&type=chunk) - Net earnings were **$94 million** (**$0.64 per diluted share**), down from **$98 million** (**$0.67 per diluted share**) in the prior year, primarily due to an unfavorable impact of **$38 million** in Special Items expense (vs. **$23 million** prior year)[8](index=8&type=chunk) - Adjusted EBITDA increased **2.5%** to **$293 million** (**21.9% of net sales**) from **$285 million** (**21.2%**) in the prior year, driven by lower operating costs from productivity benefits (CTO2Grow Program), partially offset by unfavorable net price realization, lower volume, and unfavorable currency translation[9](index=9&type=chunk) - Adjusted earnings per diluted share increased **7%** to **$0.89** from **$0.83** in the prior year, mainly due to higher Adjusted EBITDA and lower interest expense[10](index=10&type=chunk) [Segment Performance](index=2&type=section&id=2.2.%20Segment%20Performance) Segment performance reveals flat net sales for Food, with price gains offsetting volume declines, and a decrease in Protective net sales due to volume weakness, despite some industrial portfolio growth. Both segments saw Adjusted EBITDA impacted by productivity benefits and price/volume dynamics [Food Segment](index=2&type=section&id=2.2.1.%20Food%20Segment) The Food segment reported flat net sales, with favorable pricing offsetting volume softness in North America. Adjusted EBITDA increased due to productivity benefits, despite the volume decline - Second quarter net sales in Food were **$896 million**, **flat** as reported. Price had a favorable impact of **$14 million** (**2%**), while volumes decreased **$13 million** (**1%**), primarily due to softness in the North American market[11](index=11&type=chunk) - Adjusted EBITDA for Food was **$210 million** (**23.4% of net sales**), an increase of **3%** from **$205 million** (**22.9%**) in the prior year, driven by lower operating costs from productivity benefits (CTO2Grow Program) and slightly favorable net price realization, partially offset by lower volume[11](index=11&type=chunk) [Protective Segment](index=2&type=section&id=2.2.2.%20Protective%20Segment) The Protective segment experienced a 3% decrease in reported net sales, with volume declines from prior year customer churn partially offset by growth in the industrial portfolio and favorable currency. Adjusted EBITDA decreased due to unfavorable net price realization - Second quarter net sales in Protective were **$439 million**, a decrease of **3%** as reported. On a constant currency basis, net sales decreased **4%** (**$18 million**)[12](index=12&type=chunk) - Volumes decreased **$10 million** (**2%**), primarily due to the remaining impact of prior year customer churn in the fulfillment portfolio, partially offset by **growth in the industrial portfolio**. Price had an unfavorable impact of **$8 million** (**2%**)[12](index=12&type=chunk) - Adjusted EBITDA for Protective was **$78 million** (**17.8% of net sales**), a decrease of approximately **5%** from **$82 million** (**18.1%**) in the prior year, primarily due to unfavorable net price realization, partially offset by lower operating costs from productivity benefits (CTO2Grow Program)[12](index=12&type=chunk) [Cash Flow and Debt](index=2&type=section&id=2.3.%20Cash%20Flow%20and%20Debt) Cash flow from operating activities and Free Cash Flow significantly decreased year-to-date compared to the prior year, mainly due to higher incentive compensation and tax payments. Total debt decreased slightly, while Net Debt remained stable, and the company maintained substantial liquidity - Cash flow from operating activities for the first six months of 2025 was **$168 million**, a decrease from **$313 million** in the prior year period, primarily reflecting higher incentive compensation and tax payments[13](index=13&type=chunk) - Free Cash Flow for the first six months of 2025 was **$81 million**, down from **$207 million** in the prior year period, with capital expenditures at **$87 million** (vs. **$106 million** prior year)[14](index=14&type=chunk) - Total debt was **$4.3 billion** as of June 30, 2025, down from **$4.4 billion** as of December 31, 2024. Net Debt remained stable at **$4.0 billion** for both periods[15](index=15&type=chunk) - As of June 30, 2025, Sealed Air had approximately **$1.2 billion** of available liquidity, including **$354 million** in cash and **$830 million** in available and unused lines of credit[15](index=15&type=chunk) - The net leverage ratio was **3.6x** as of June 30, 2025, consistent with December 31, 2024[15](index=15&type=chunk) Financial Outlook & Corporate Information This section outlines the company's full-year 2025 financial guidance, provides an overview of its business, and clarifies its use of non-GAAP measures and forward-looking statements [2025 Full Year Outlook](index=3&type=section&id=3.1.%202025%20Full%20Year%20Outlook) Sealed Air provided its full-year 2025 financial guidance, including ranges for Net Sales, Adjusted EBITDA, Adjusted EPS, and Free Cash Flow, noting that non-GAAP measures are used due to the variability of certain Special Items | (in $ millions except EPS) | Range | Constant currency △% | | :------------------------- | :---------------- | :------------------- | | Net Sales | $5,100 to $5,500 | (6)% to 2% | | Adjusted EBITDA | $1,075 to $1,175 | (3)% to 6% | | Adjusted EPS | $2.90 to $3.30

Core Insights - Sealed Air Corporation reported second quarter 2025 financial results, showing a slight decline in net sales and earnings, but an increase in adjusted earnings and EBITDA, indicating resilience amid market pressures [2][3][5]. Financial Performance - Net sales for Q2 2025 were $1.335 billion, a decrease of 0.8% from Q2 2024, with the Food segment flat and the Protective segment down 3% [3][5]. - Net earnings were $94 million, or $0.64 per diluted share, down from $98 million, or $0.67 per diluted share in the prior year [5][34]. - Adjusted EBITDA increased to $293 million, representing 21.9% of net sales, compared to $285 million, or 21.2% in the prior year [6][30]. Segment Performance - The Food segment reported net sales of $896 million, flat year-over-year, with a slight volume decrease of 1% but a favorable price impact of 2% [8][27]. - The Protective segment saw net sales of $439 million, a decrease of 3%, with a 2% unfavorable price impact and a 2% volume decrease [9][27]. Cash Flow and Debt Management - Cash flow from operations for the first half of 2025 was $168 million, down 46.2% from $313 million in the prior year, primarily due to higher incentive compensation and tax payments [11][12]. - Free cash flow for the first half of 2025 was $81 million, a significant decrease from $207 million in the same period last year [12][25]. - Total debt as of June 30, 2025, was $4.3 billion, with net debt remaining stable at $4.0 billion [13][13]. Outlook - The company maintains its full-year guidance for 2025, projecting net sales between $5.1 billion and $5.5 billion, with adjusted EBITDA between $1.075 billion and $1.175 billion [14][14]. - The outlook reflects a cautious approach due to ongoing market pressures and shifts in consumer spending patterns [2][10].

Group 1 - Sealed Air Corporation has appointed Kristen Actis-Grande as Chief Financial Officer, effective August 25, 2025, to enhance its ongoing transformation efforts [1] - Actis-Grande has a strong background in finance, previously serving as Executive Vice President and CFO of MSC Industrial Supply Co. and holding various finance leadership roles at Ingersoll Rand for 17 years [1] - The company generated $5.4 billion in sales in 2024 and employs approximately 16,400 people across 117 countries/territories [3] Group 2 - Kristen Actis-Grande succeeds Veronika "Roni" Johnson, who served as Interim CFO since February 14, 2025, and will continue as Chief Accounting Officer [2] - The CEO of Sealed Air expressed gratitude towards Johnson for her leadership during a critical period in the company's transformation [3] - Sealed Air is recognized for its packaging solutions that cater to various markets, including food, medical, e-commerce, and industrial sectors [3]

Core Insights - Sealed Air Corporation (SEE) is set to report its second-quarter 2025 results on August 5, with net sales estimated at $1.32 billion, reflecting a 1.9% decline year-over-year [1][6] - The consensus estimate for earnings is 72 cents per share, indicating a year-over-year decline of 13.3% and a 1.4% decrease in estimates over the past 60 days [2][6] Financial Performance - Sealed Air has a history of exceeding earnings estimates, with an average surprise of 20.6% over the last four quarters [4] - The company's earnings per share (EPS) for the last four quarters were reported as follows: 0.81, 0.75, 0.79, and 0.83, with respective surprises of 20.90%, 11.94%, 19.70%, and 29.69% [5][4] Segment Analysis - The Food segment is projected to generate net sales of $891 million, a 0.3% decline from the previous year, with a slight volume decrease of 0.2% [10][9] - The Protective segment is expected to see net sales of $424 million, down 6% year-over-year, continuing a trend of volume declines for 13 consecutive quarters [11][8] - Overall, Sealed Air's volumes are anticipated to dip by 1.7%, with a minimal pricing growth of 0.1% for the quarter [11] Strategic Initiatives - The company's "Reinvent SEE Strategy" is expected to enhance productivity and mitigate supply chain challenges, positively impacting operating margins in the upcoming quarter [12] Stock Performance - Over the past year, Sealed Air's stock has decreased by 20%, compared to a 7.9% decline in the industry [13]

Group 1 - Sealed Air will release its second quarter 2025 results on August 5, 2025, at 7 a.m. EDT, followed by a conference call at 10 a.m. EDT [1] - The conference call will be available via live webcast on Sealed Air's Investors homepage [1] Group 2 - Sealed Air Corporation is a leading global provider of packaging solutions, focusing on sustainable materials, automation, and services [2] - The company generated $5.4 billion in sales in 2024 and employs approximately 16,400 people across 117 countries/territories [2] - Sealed Air's product offerings include well-known brands such as CRYOVAC®, LIQUIBOX®, SEALED AIR®, AUTOBAG®, and BUBBLE WRAP® [2]

Group 1 - The article discusses a revisit to Sealed Air Corporation (NYSE: SEE), a global packaging company, highlighting a previously bullish stance based on share pricing [1] - The focus is on cash flow and the potential for value and growth in the oil and natural gas sector, as indicated by the services offered by Crude Value Insights [1] Group 2 - Subscribers to the service benefit from a 50+ stock model account and in-depth cash flow analyses of exploration and production firms [2] - The service includes live chat discussions about the oil and gas sector, enhancing community engagement and information sharing [2]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company reported lower Q1 net sales but higher net earnings, alongside a stronger balance sheet and reduced operating cash flow [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets slightly increased to $7.05 billion while total liabilities decreased, boosting stockholders' equity to $797.9 million Condensed Consolidated Balance Sheet Highlights (in USD millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $1,905.8 | $1,891.8 | | **Total assets** | $7,049.2 | $7,022.1 | | **Total current liabilities** | $1,507.4 | $1,635.5 | | **Total liabilities** | $6,251.3 | $6,397.6 | | **Total stockholders' equity** | $797.9 | $624.5 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 net sales decreased 4.3% to $1.27 billion, while net earnings grew 38.4% to $113.5 million due to a lower tax provision Statement of Operations Summary (in USD millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net sales | $1,272.5 | $1,329.6 | | Gross profit | $391.7 | $400.8 | | Operating profit | $183.4 | $185.0 | | Net earnings | $113.5 | $82.0 | | Diluted EPS | $0.77 | $0.56 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities declined sharply to $31.9 million, contributing to a negative net change in cash for the quarter Cash Flow Summary (in USD millions) | Cash Flow Category | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $31.9 | $125.1 | | Net cash used in investing activities | $(43.5) | $(38.0) | | Net cash used in financing activities | $(45.3) | $(69.1) | | **Net change in cash** | **$(36.6)** | **$6.7** | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail segment performance, restructuring costs, debt structure, and a significantly lower effective tax rate of 8.0% [Note 5: Segments](index=14&type=section&id=Note%205%20Segments) The Food segment's gross profit increased despite lower sales, while the Protective segment saw declines in both sales and profit Segment Performance (in USD millions) | Segment | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | :--- | | **Food** | Net Sales | $852.1 | $868.4 | | | Gross Profit | $268.1 | $259.5 | | **Protective** | Net Sales | $420.4 | $461.2 | | | Gross Profit | $124.1 | $141.3 | [Note 12: Restructuring Activities](index=20&type=section&id=Note%2012%20Restructuring%20Activities) The 'CTO2Grow Program' incurred $9.0 million in total charges in Q1 2025 as part of its 3-year, $160 million cost-saving plan - The Board of Directors approved the 'CTO2Grow Program' on August 7, 2023, a 3-year cost take-out initiative with an estimated total cash cost of **$160 million**[84](index=84&type=chunk) Restructuring Charges (in USD millions) | Expense Type | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Restructuring charges | $2.6 | $15.5 | | Other associated costs | $6.4 | $6.8 | | **Total charges** | **$9.0** | **$22.2** | [Note 13: Debt and Credit Facilities](index=22&type=section&id=Note%2013%20Debt%20and%20Credit%20Facilities) Total debt remained stable at approximately $4.4 billion, with a weighted average interest rate of 5.3% and $1.15 billion in unused credit Total Debt Outstanding (in USD millions) | Debt Category | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current debt | $208.7 | $205.1 | | Total long-term debt, less current portion | $4,195.5 | $4,198.8 | | **Total debt** | **$4,404.2** | **$4,403.9** | - As of March 31, 2025, the weighted average interest rate on long-term debt was **5.3%**, and the company had **$1,147.0 million** in unused lines of credit[90](index=90&type=chunk)[92](index=92&type=chunk) [Note 17: Income Taxes](index=29&type=section&id=Note%2017%20Income%20Taxes) The effective tax rate dropped to 8.0% from 30.0% year-over-year due to the resolution of international tax matters - The effective income tax rate was **8.0% for Q1 2025**, compared to 30.0% for Q1 2024[130](index=130&type=chunk)[131](index=131&type=chunk) - The lower tax rate in Q1 2025 was favorably impacted by the reversal of accruals for uncertain tax positions related to the resolution of previous years' international tax matters[130](index=130&type=chunk) - Net unrecognized tax positions decreased by **$44.2 million** in Q1 2025[133](index=133&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a 4.3% sales decline due to lower volumes, offset by cost controls maintaining stable margins and liquidity [Highlights of Financial Performance](index=43&type=section&id=Highlights%20of%20Financial%20Performance) Q1 2025 net sales fell 4.3%, while net earnings grew 40.2% and Adjusted EBITDA decreased by a slight 0.7% Q1 2025 Financial Highlights vs. Q1 2024 (in USD millions, except per share) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Net sales | $1,272.5 | $1,329.6 | (4.3)% | | Net earnings from continuing operations | $116.9 | $83.4 | 40.2% | | Non-GAAP Consolidated Adjusted EBITDA | $276.3 | $278.3 | (0.7)% | | Non-GAAP Adjusted EPS | $0.81 | $0.78 | 3.8% | [Net Sales by Segment](index=45&type=section&id=Net%20Sales%20by%20Segment) The Food segment's constant currency sales grew 0.9%, while the Protective segment's sales fell 7.6% on lower volumes Components of Net Sales Change, Q1 2025 vs Q1 2024 | Segment | Price | Volume | Constant Currency Change | | :--- | :--- | :--- | :--- | | Food | +0.6% | +0.3% | +0.9% | | Protective | -1.4% | -6.2% | -7.6% | | **Total Company** | **-0.1%** | **-1.9%** | **-2.0%** | [Adjusted EBITDA by Segment](index=50&type=section&id=Adjusted%20EBITDA%20by%20Segment) The Food segment's Adjusted EBITDA grew 6.9% with margin expansion, while the Protective segment's fell 17.4% with margin contraction Adjusted EBITDA by Segment (in USD millions) | Segment | Q1 2025 Adj. EBITDA | Q1 2024 Adj. EBITDA | % Change | | :--- | :--- | :--- | :--- | | Food | $202.7 | $189.6 | 6.9% | | Protective | $73.9 | $89.5 | (17.4)% | | **Total** | **$276.3** | **$278.3** | **(0.7)%** | [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains $335.2 million in cash, with total debt at $4.4 billion and a leverage ratio of 3.30 to 1.00 - Primary sources of cash are collections from sales and available credit facilities; as of March 31, 2025, cash and cash equivalents were **$335.2 million**[221](index=221&type=chunk)[223](index=223&type=chunk) Cash Flow and Debt Summary (in USD millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from operating activities | $31.9 | $125.1 | | Non-GAAP free cash flow | $(12.0) | $78.0 | | Total Debt (as of Mar 31, 2025) | $4,404.2 | N/A | - The company was in compliance with its debt covenants at March 31, 2025, with a leverage ratio of **3.30 to 1.00**, below the maximum of 4.50 to 1.00[229](index=229&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces interest rate, foreign currency, and credit risks, managed through various derivative instruments - A hypothetical **10% increase in interest rates** would result in a decrease of **$76 million** in the fair value of the total debt balance at March 31, 2025[259](index=259&type=chunk) - The company recognized a remeasurement loss of **$2 million** in Q1 2025 related to the designation of Argentina as a highly inflationary economy[261](index=261&type=chunk) - The company uses foreign currency forward contracts and cross-currency swaps (notional amount of **$433 million**) to manage foreign exchange risk[263](index=263&type=chunk)[266](index=266&type=chunk) [Controls and Procedures](index=58&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls in Q1 2025 - Management's evaluation concluded that disclosure controls and procedures were effective at the **'reasonable assurance' level** as of the end of the period[272](index=272&type=chunk) - There were **no changes in internal control** over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[273](index=273&type=chunk) [PART II. OTHER INFORMATION](index=59&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=59&type=section&id=Item%201.%20Legal%20Proceedings) The company is engaged in a legal dispute with Water.IO Ltd. but does not believe a probable loss is associated with the claim - The company is in a legal dispute with Water.IO Ltd. over a 2018 Purchase Agreement for sensors, with complaints filed by both parties[135](index=135&type=chunk) - The company does not believe it has a **probable loss** associated with the claim and intends to defend its interests vigorously[135](index=135&type=chunk) [Risk Factors](index=59&type=section&id=Item%201A.%20Risk%20Factors) There have been no significant changes to the company's risk factors as disclosed in its 2024 Form 10-K - There have been **no significant changes** to the company's risk factors since December 31, 2024[275](index=275&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company transferred 824,393 shares to its 401(K) plan and made no share repurchases, with $537 million remaining on its program - In March 2025, **824,393 shares of common stock** were transferred from treasury to the company's 401(K) and Profit Sharing Plan[276](index=276&type=chunk) - **No shares were repurchased** during the three months ended March 31, 2025; the remaining authorization under the share repurchase program is approximately **$537 million**[278](index=278&type=chunk)

Core Viewpoint - Sealed Air Corporation reported a mixed performance in Q1 2025, with adjusted earnings per share of 81 cents exceeding estimates, but total sales declined due to lower volumes in the Protective segment [1][2]. Financial Performance - Adjusted earnings per share were 81 cents, surpassing the Zacks Consensus Estimate of 67 cents, marking a 4% year-over-year improvement [1] - Total sales for the quarter were $1.272 billion, beating the Zacks Consensus Estimate of $1.269 billion, but down 4.3% from $1.33 billion in Q1 2024 [2] - The cost of sales decreased by 5% year over year to $881 million, while gross profit was $392 million, a 2% decrease from $401 million in the previous year [3] - Adjusted EBITDA was approximately $276 million, a decline of 0.7% from the year-ago period, with an adjusted EBITDA margin of 21.7%, up from 20.9% [4][5] Segment Performance - In the Food segment, net sales decreased by 2% year over year to $852.1 million, exceeding estimates, with pricing actions positively impacting sales by 0.6% [6] - The Protective segment saw net sales of $420 million, down 9% from the previous year, with a significant volume decline of 6.2% [7][8] - Adjusted EBITDA for the Food segment was around $203 million, up 7% year over year, while the Protective segment's adjusted EBITDA decreased by 17% to $74 million [9] Cash Flow and Balance Sheet - Cash flow from operating activities was approximately $32 million, down from $125 million in the prior year [10] - Total debt remained flat at $4.4 billion, with $1.3 billion in liquidity available as of March 31, 2025 [11] 2025 Guidance - Sealed Air expects net sales between $5.1 billion and $5.5 billion for 2025, projecting a 2% dip from $5.39 billion in 2024 [12] - Adjusted EBITDA is forecasted to be between $1.075 billion and $1.175 billion, with adjusted earnings per share expected to range from $2.90 to $3.30 [12] Share Price Performance - Over the past year, Sealed Air's shares have declined by 23%, compared to an 11.9% decline in the industry [13]

Financial Data and Key Metrics Changes - Net sales for the first quarter were $1.27 billion, down 2% on a constant currency basis [23] - Adjusted EBITDA was $276 million, up 2% on a constant currency basis [23] - Adjusted earnings per share increased by 4% as reported and 9% on a constant currency basis, reaching $0.81 [24] - Adjusted EBITDA margin improved to 21.7%, up 80 basis points [25] Business Line Data and Key Metrics Changes - Food segment net sales were $852 million, up 1% on an organic basis, driven by pricing actions and marginal volume growth [26] - Protective segment net sales were $420 million, down 8% organically, primarily due to volume declines [27] - Food adjusted EBITDA was $203 million, up 7% as reported and 10% in constant currency, with an adjusted EBITDA margin of 23.8% [26][28] - Protective adjusted EBITDA was $74 million, down 18% as reported, with an adjusted EBITDA margin of 17.6%, down 180 basis points [28] Market Data and Key Metrics Changes - The industrial food processing markets were relatively flat compared to the previous year, with some regions showing growth while others faced declines [15][17] - In the Protective segment, box shipments in the U.S. were down low single digits, reflecting declining consumer confidence [19] - EMEA showed signs of stabilization, with volumes down just 1%, marking the best quarter since 2021 [28] Company Strategy and Development Direction - The company is focused on transforming its operations by reorganizing into two market-focused businesses: Food and Protective [6][7] - There is an emphasis on enhancing leadership and aligning commercial, innovation, and supply chain teams to better serve customers [8] - The company is actively reviewing its supply chain and optimizing production to mitigate potential tariff impacts and inflation [10][12] Management's Comments on Operating Environment and Future Outlook - Management noted a cautious outlook due to potential softness in market demand and ongoing trade policy uncertainties [11][13] - The company is reaffirming its full-year guidance while anticipating better visibility into trade policies and market demand in the second half of the year [30][31] - Management expressed confidence in the food business's resilience and long-term potential despite current market volatility [17][18] Other Important Information - The company reported a cash flow use of $12 million in the first quarter, compared to a source of $78 million in the same period last year [29] - Total liquidity at the end of the quarter was $1.3 billion, with a net debt leverage ratio of 3.7 times [29] Q&A Session Summary Question: Comments on protective volumes and progress - Management indicated that protective volumes were down approximately 6% in Q1, but churn from large customers has been minimized, leading to expected sequential improvement in Q2 [35][36] Question: Measuring customer improvement - Management confirmed they are using customer feedback mechanisms and have seen improvements in customer satisfaction, although there is still work to be done [42][45] Question: Price changes and competitive landscape - Management noted that net price realization remains relatively unchanged, with competitive pressures particularly affecting the protective segment [53][55] Question: Gross margins despite sales decline - Management attributed margin expansion to ongoing productivity initiatives and cost takeout efforts, which have improved cost positions [61][62] Question: Timing for protective turnaround - Management indicated that the protective turnaround is ongoing, with expectations for improvements over the next 90 days to six months [72][75] Question: Volume assumptions for the second half - Management stated that they expect a modest decline in protective volumes of about 1% in the second half, with ongoing monitoring of market conditions [82][86]

Core Insights - Sealed Air reported revenue of $1.27 billion for Q1 2025, a decrease of 4.3% year-over-year, but slightly above the Zacks Consensus Estimate of $1.27 billion, resulting in a surprise of +0.26% [1] - The company's EPS for the quarter was $0.81, an increase from $0.78 in the same quarter last year, with a significant EPS surprise of +20.90% compared to the consensus estimate of $0.67 [1] Financial Performance - Net Sales in the Food segment were $852.10 million, slightly below the estimated $854.65 million, reflecting a year-over-year decline of -1.9% [4] - Net Sales in the Protective segment were $420.40 million, exceeding the average estimate of $417.02 million, but showing a year-over-year decrease of -8.9% [4] - Adjusted EBITDA for the Food segment was reported at $202.70 million, surpassing the estimate of $191.56 million [4] - Adjusted EBITDA for Corporate expenses and unallocated costs was -$0.30 million, better than the estimated -$3.34 million [4] - Adjusted EBITDA for the Protective segment was $73.90 million, slightly above the average estimate of $72 million [4] Market Performance - Sealed Air's shares have returned +14% over the past month, outperforming the Zacks S&P 500 composite's +11.5% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]