Sonoco Products Company (NYSE:SON) Q4 2022 Earnings Conference Call February 9, 2023 8:30 AM ET Company Participants Howard Coker - President, Chief Executive Officer Rob Dillard - Chief Financial Officer Rodger Fuller - Chief Operating Officer Lisa Weeks - Vice President, Investor Relations Conference Call Participants Kyle White - Deutsche Bank George Staphos - Bank of America Cleve Rueckert - UBS Mark Weintraub - Seaport Research Partners Adam Josephson - Keybanc Capital Markets Matt Krueger - Baird Ant ...

Sonoco Investor Update November 10, 2022 Better Than Ever. Forward-Looking Statements / Non-GAAP Financial Measures Today's presentation contains several forward-looking statements based on current expectations, estimates and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Information about the Company's use of non-GAAP financial measures, why management believes presentation of non-GA ...

Financial Performance & Guidance - The company's 2022 sales guidance is $7.34 billion, a 31% year-over-year increase[9] - The company's 2022 base EBITDA guidance is $1,150 million, a 52% year-over-year increase[9] - The company's 2022 base EPS guidance is $6.45, a 64% year-over-year increase[9] - Q3 2022 revenue reached $1.9 billion, a 34% year-over-year increase[42] - Q3 2022 base EBITDA was $284 million, a 55% year-over-year increase[43] - Q3 2022 base EPS was $1.60, a 60% year-over-year increase[40] Strategic Investments & Acquisitions - The company has a capital budget of approximately $325 million in 2022 focused on high-return organic growth and productivity initiatives[21] - The company acquired Skjern Paper for $88 million, with expected synergies of approximately $2.1 million in 18 months[23] - The company acquired RTS Packaging for $330 million, with expected synergies of approximately $16 million in 24 months[23] ESG & Sustainability - The company has $183 million in diversity spending with suppliers[33] - The company has $1.85 million in Sonoco Foundation Spend[33] - The company's board diversity rate is 45%[33]

Financial Data and Key Metrics Changes - Revenue grew 34% year-over-year to $1.9 billion, with base EBITDA margins expanding by 200 basis points to 15% [10][15][17] - Base earnings per share increased 60% to $1.60, driven by strong operating performance [10][17] - Base operating profit rose 67% to $225 million, with base operating profit margin increasing by 240 basis points to 11.9% [16][17] Business Line Data and Key Metrics Changes - Consumer segment sales increased 72% to $1 billion, with operating profit growing 93% to $128 million [27] - Industrial segment sales grew 4% to $661 million, and operating profit increased 48% to $82 million [28] - All other sales rose 10% to $198 million, with operating profit increasing 19% to $15 million [29] Market Data and Key Metrics Changes - Consumer prices increased by 18%, contributing positively to revenue growth [19] - Industrial volumes were down 9.5%, particularly impacted in Europe and Asia [18] - Organic sales growth was still 10% in the quarter, excluding acquisitions [20] Company Strategy and Development Direction - The company is focused on sustainability and innovation, with significant investments in new product designs and operational excellence [46][49] - Project Horizon aims to modernize operations and enhance production efficiency, transitioning to 100% recycled fiber [49][51] - The acquisition of Skjern Paper in Denmark is intended to increase lightweight production capacity in Europe [52][53] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the consumer business, noting robust activity and normal seasonal trends [68] - There are concerns about industrial demand in Europe and Asia, with expectations of lower volumes in the fourth quarter [39][40] - The company anticipates higher free cash flows in 2023 as supply chains normalize [34] Other Important Information - The company has increased its full-year EPS guidance to $6.40 to $6.50, reflecting strong performance [32] - Capital allocation remains focused on high-return investments and maintaining an investment-grade credit rating [30][31] Q&A Session Summary Question: Expectations on free cash flow guidance and inventory headwinds - Management expects to recover $100 million in working capital in 2023 as supply chains normalize, with a positive outlook on price/cost benefits [64][66] Question: Demand trends in the consumer business - Demand has been robust, with normal seasonal builds observed, and inventory destocking is primarily driven by industrial customers [68][72] Question: Value-based pricing initiatives - The company is focused on strategic pricing and self-help initiatives to drive productivity and value generation [75][85] Question: Long-term EBITDA guidance - Management is reviewing long-term objectives and expects to provide updates early next year [105] Question: Impact of lower OCC and resin prices - Lower OCC prices have positively impacted price/cost benefits, with expectations for continued benefits in the fourth quarter [112] Question: Changes in capital allocation process with new CFO - The capital allocation strategy remains focused on core competencies and value-driven acquisitions [114][116]

Financial Performance & Projections - Sonoco's projected sales for 2022 are between $7250 million and $7500 million, with a base EBITDA between $1125 million and $1150 million[7] - The company experienced year-over-year revenue growth of approximately 38% in Q2 2022[34] - Base earnings per share grew to $1.76 in Q2 2022, an 89% increase year-over-year[34] - Updated 2022 base EPS guidance increased by approximately 17%, from $5.25-$5.45 to $6.20-$6.30[28] Segment Performance (Q2 2022 vs Q2 2021) - Consumer Packaging net sales increased by 65.6%, from $598 million to $990 million, with base operating profit up 113.5%, from $65 million to $139 million[46] - Industrial Paper Packaging net sales increased by 19.5%, from $609 million to $727 million, with base operating profit up 57.5%, from $60 million to $94 million[46] - All Other net sales increased by 11.1%, from $176 million to $196 million, with base operating profit up 5.9%, from $16 million to $17 million[46] Strategy & Capital Deployment - The company is targeting approximately $180 million in annual EBITDA by 2026 through self-help actions[9, 10] - The 2022 capital budget is approximately $325 million, primarily funding high-ROIC organic growth initiatives[26] - The company returned cash to shareholders through dividends and stock repurchases[19]

Quarterly Financial Review Sonoco Second Quarter 2022 Results Investor Presentation | July 2022 Better Than Ever. Forward-Looking Statements / Non-GAAP Financial Measures 2 Today's presentation contains a number of forward-looking statements based on current expectations, estimates and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Information about the Company's use of non-GAAP finan ...

Quarterly Financial Review Sonoco Second Quarter 2022 Results Investor Presentation | July 2022 Better Than Ever. Forward-Looking Statements / Non-GAAP Financial Measures 2 Today's presentation contains a number of forward-looking statements based on current expectations, estimates and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Information about the Company's use of non-GAAP finan ...

Financial Data and Key Metrics Changes - Revenue for Q2 2022 increased by 38% year-over-year, reaching $1.9 billion, marking the highest quarterly sales in the company's history [7][8] - Base earnings per share (EPS) grew to $1.76, an 89% increase compared to Q2 2021 [8][14] - Base EBITDA increased by 62% to $306 million, with a base EBITDA margin expansion of 230 basis points to 16% [15][18] - The company raised its full-year base EPS guidance to a range of $6.20 to $6.30 [9][23] Business Line Data and Key Metrics Changes - Consumer net sales grew by 66% to $990 million, with operating profit increasing by 114% to $139 million [19] - Industrial paper net sales increased by 20% to $727 million, marking the eighth consecutive quarter of record net sales, while operating profit grew by 57% to $94 million [20] - Metal packaging significantly contributed to growth, achieving a 21% operating profit margin due to strong price-cost performance [18] Market Data and Key Metrics Changes - Approximately 72% of net sales are generated in the U.S., with a negative impact of $44 million from foreign exchange and other factors [17] - Volume mix was negative 1% in the quarter, indicating stable demand conditions in consumer-oriented markets [16] Company Strategy and Development Direction - The company is focusing on optimizing its portfolio by aligning to fewer, larger businesses, with consumer packaging representing over 50% of its operations [28] - Investments in high-return capital projects are prioritized, with $325 million allocated for 2022, including significant investments in consumer and industrial businesses [31] - Sustainability initiatives are central to the company's mission, aiming to reduce greenhouse gas emissions by 25% by 2030 [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's performance and strategic initiatives, emphasizing the importance of operational excellence and supply chain management [34] - The company anticipates continued strong performance in defensive consumer markets, with expectations for price-cost dynamics to remain favorable [63] Other Important Information - The company is maintaining a conservative capital structure, expecting net debt to be well below 3x base EBITDA by the end of 2022 [22] - Despite strong operational performance, cash flow guidance remains unchanged due to uncertainties in supply chains and inflation impacts [24] Q&A Session Summary Question: What would it take to unlock working capital and outperform cash flow guidance? - Management noted that inflation trends and supply chain disruptions have impacted net working capital, but they are focused on improving asset efficiency [38][39] Question: Can you provide insight into normalized margins for the future? - Management indicated that while there are inflationary pressures, they remain bullish about future performance and margin improvements [40][42] Question: What is the outlook for industrial and consumer markets as the quarter progressed? - Management reported strong performance in the U.S. industrial market, while noting challenges in Europe and Asia due to supply chain issues [51][52] Question: Can you discuss the trajectory of price-cost benefits for the year? - Management expects a full-year price-cost benefit in the range of $250 million to $300 million, significantly higher than previous expectations [71][72] Question: How does the company view its capital allocation and share buybacks? - Management is evaluating capital allocation strategies, emphasizing a commitment to maintaining an investment-grade credit rating while returning capital to shareholders through dividends [69]

JUNE 22, 2022 SONOCO INVESTOR UPDATE BANK OF MONTREAL 2022 CHEMICALS & PACKAGING CONFERENCE Better Than Ever. FORWARD-LOOKING STATEMENTS/NON-GAAP FINANCIAL MEASURES Today's presentation contains a number of forward-looking statements based on current expectations, estimates and projections. These statements are not guarantees offuture performance and are subject to certain risks and uncertainties. Therefore, actual resultsmay differ materially. Information about the Company's use of non-GAAP financial measu ...

MAY 10, 2022 UBS SUSTAINABLE PACKAGING MATERIALS ESG VIRTUAL CONFERENCE Better Than Ever. Howard Coker Sonoco President and CEO FORWARD-LOOKING STATEMENTS/NON-GAAP FINANCIAL MEASURES Today's presentation contains a number of forward-looking statements based on current expectations, estimates and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Information about the Company's use of non- ...