Core Viewpoint - Sonoco Products Company has signed a definitive agreement to sell its ThermoSafe business unit to Arsenal Capital Partners for a total purchase price of up to $725 million, marking a significant step in Sonoco's portfolio transformation into a global leader in metal and fiber packaging [1][3]. Group 1: Transaction Details - The purchase price includes $650 million on a cash-free and debt-free basis payable at closing, with an additional consideration of up to $75 million based on performance measures for 2025 [1]. - The transaction is expected to be completed by the end of 2025, subject to customary closing conditions including regulatory review [1]. - Net proceeds from the sale are anticipated to be used to repay existing debt, which will further reduce Sonoco's net leverage ratio to approximately 3.5x [3]. Group 2: ThermoSafe Overview - ThermoSafe is a leading global provider of temperature-controlled packaging solutions, generating over $240 million in sales and approximately $50 million in proforma adjusted EBITDA in 2024 [2]. - The business offers a wide range of products featuring advanced technology, including bio-based insulation materials and reusable technologies, catering to refrigerated, frozen, or controlled room temperature applications [2]. - ThermoSafe employs around 900 associates across operations in the Americas, EMEA, and Asia [2]. Group 3: Strategic Implications - The sale of ThermoSafe is part of Sonoco's strategy to streamline operations from a diversified portfolio into two core global business segments, enhancing focus on sustainable growth and value creation for customers [3]. - Sonoco's President and CEO highlighted the successful growth of ThermoSafe, noting that revenues have more than doubled since 2012, alongside significant improvements in technology and product offerings [3]. Group 4: Company Background - Sonoco, founded in 1899, is a global leader in sustainable metal and fiber packaging, operating in 40 countries with approximately 23,400 employees [8]. - The company has been recognized as one of America's Most Admired and Responsible Companies and is listed among America's Climate Leaders [8]. Group 5: Arsenal Capital Partners Overview - Arsenal Capital Partners is a private equity firm specializing in building market-leading industrial growth and healthcare companies, having raised over $10 billion since its inception in 2000 [9]. - The firm focuses on partnering with management teams to develop strategically important companies with leading market positions and high growth potential [9].

Core Viewpoint - Sonoco Products (NYSE: SON) has underperformed in the past year, losing approximately 15% of its value and missing out on a significant equity market rally [1] Company Performance - The company has been making dramatic alterations to its operations, indicating a potential shift in strategy or focus [1]

Core Insights - Sonnet BioTherapeutics is expanding its clinical study of SON-1010 in combination with atezolizumab for patients with advanced platinum-resistant ovarian cancer, showing promising early results with a 66% tumor response rate at the highest dose [1][2] - The company is also exploring a higher maintenance dose of SON-1010 to assess its safety and efficacy before moving to a randomized Phase 2a trial [1][2] - SON-1010 is designed to enhance immune response in tumors by delivering IL-12 directly to the tumor microenvironment, potentially improving treatment outcomes for various cancers [3][4] Company Overview - Sonnet BioTherapeutics focuses on developing targeted biologic drugs using its Fully Human Albumin-Binding (FHAB) platform, which aims to optimize the safety and efficacy of immune-modulating therapies [6][7] - The company is currently evaluating SON-1210, another candidate using the FHAB platform, for the treatment of pancreatic cancer in collaboration with the Sarcoma Oncology Center [7] Clinical Trial Details - The SB221 trial is a Phase 1b/2a multicenter study assessing the safety, tolerability, pharmacokinetics, pharmacodynamics, and efficacy of SON-1010, both alone and in combination with atezolizumab [5] - The trial aims to establish the maximum tolerated dose (MTD) and evaluate the potential for improved efficacy in patients with platinum-resistant ovarian cancer [5]

Financial Data and Key Metrics Changes - Net sales increased by 49% to $1.9 billion, driven by the acquisition of S and P EMEA and strong volume in the U.S. business [6][22] - Adjusted EBITDA rose by 25% to $328 million, with adjusted EBITDA margin improving by 101 basis points to 17.2% [6][22] - Adjusted EPS was $1.37, reflecting a 7% year-over-year increase, impacted by higher interest expenses [21][22] Business Line Data and Key Metrics Changes - Consumer Packaging segment saw a 115% growth in adjusted EBITDA, attributed to a 10% volume mix gain in the U.S. metal business and the acquisition of EVOSA [7][23] - Industrial segment adjusted EBITDA increased by 15% to $113 million, despite a 2% decline in sales to $588 million due to lower volumes [24][25] - All Other segment sales were flat at $95 million, with adjusted EBITDA declining by 8% [26] Market Data and Key Metrics Changes - EMEA sales were impacted by a delay in the European vegetable packaging season, with approximately 40% of sales being seasonal [15][16] - Demand for pet food and certain premium food categories remained resilient despite macroeconomic pressures [16] - The company expects a solid vegetable harvest in the third quarter, which is typically the strongest quarter [16] Company Strategy and Development Direction - The company is focused on businesses where it can leverage advanced material science and technology to drive competitive advantage [9][10] - Recent divestitures, including Thermoform and Flexible Packaging, are aimed at reallocating capital to core businesses [10][11] - The company is targeting $100 million in cost savings through synergies from the S and P EMEA acquisition by 2026 [12][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged global macroeconomic pressures affecting consumer and industrial demand, but remains optimistic about strong performance in the Consumer segment [6][28] - The company is maintaining its full-year guidance for net sales between $7.75 billion and $8 billion, with adjusted EBITDA guidance of $1.3 billion to $1.4 billion [28][29] - Management is focused on controlling costs and reducing leverage while creating long-term value for shareholders [36] Other Important Information - The company has invested $188 million in capital for the first half of 2025, with expectations to reach $360 million by year-end [30] - The integration of S and P EMEA is progressing well, with projected synergies of $40 million to $50 million by the end of the year [12][19] - The company is preparing for the sale of ThermoSafe, with expectations to use proceeds to further reduce net leverage [11][12] Q&A Session Summary Question: Can you discuss the volume run rate across major businesses and expectations for SMT EMEA? - Management indicated slight volume declines in Q2 but expects mid to upper single-digit increases in Q3 due to a late start in the vegetable harvest [41][48] Question: What are the reasons for the relatively light incremental margin in the consumer segment? - Management attributed the light margin to seasonal mix impacts and noted that the business is performing well despite volume shortfalls [50][51] Question: How will stranded costs improve moving forward? - Management expects improvements in stranded costs in the second half of the year and is focused on eliminating these costs [61][63] Question: What are the expectations for EBITDA in the EVO business? - Management confirmed expectations for year-over-year EBITDA growth in the EVO business, with significant incremental business opportunities identified [68][70] Question: How are tariffs impacting the business? - Management acknowledged that tariffs are a concern but noted that they are managing the impact effectively and expect to recover costs on the P&L side [76][78] Question: Can you clarify the factors affecting revised guidance? - Management indicated that the lower EPS guidance is primarily due to higher-than-anticipated interest expenses, while revenue and EBITDA guidance remains strong [102][104]

Financial Data and Key Metrics Changes - Net sales increased by 49% to $1.9 billion, driven by the S and P EMEA acquisition and strong volume in the U.S. business [22][5] - Adjusted EBITDA rose by 25% to $328 million, with adjusted EBITDA margin improving by 101 basis points to 17.2% [22][5] - Adjusted EPS was $1.37, reflecting a 7% year-over-year increase, impacted by higher interest expenses [21][5] Business Line Data and Key Metrics Changes - Consumer Packaging segment saw a 110% increase in sales, with adjusted EBITDA growing by 115% due to acquisitions and productivity gains [23][6] - Industrial segment sales decreased by 2% to $588 million, with adjusted EBITDA increasing by 15% to $113 million, driven by favorable pricing despite lower volumes [24][6] - All Other business sales were flat at $95 million, with adjusted EBITDA declining by 8% [25][6] Market Data and Key Metrics Changes - EMEA sales were impacted by a late start to the vegetable packaging season, with expectations for recovery in the third quarter [15][14] - Demand for pet food and premium food categories remained resilient despite macroeconomic pressures [15][14] - The company anticipates a solid vegetable harvest in the third quarter, which is expected to drive growth [15][14] Company Strategy and Development Direction - The company is focused on businesses where it can leverage advanced material science and technology to drive competitive advantage [8][10] - Recent divestitures are aimed at reallocating capital to core businesses, with a target to reduce net leverage to 3-3.3 times by the end of 2026 [11][10] - The company is investing in automation and capacity expansion to enhance productivity and meet growing market demands [29][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged global macroeconomic pressures affecting consumer and industrial demand but expressed confidence in strong performance in the North American markets [27][28] - The company is maintaining its full-year guidance for net sales and adjusted EBITDA, despite some softness in international markets [27][28] - Management remains focused on controlling costs and reducing leverage while creating long-term shareholder value [36][28] Other Important Information - The company has achieved approximately $20 million in annual savings from stranded costs due to divestitures and is optimizing its operating footprint [12][11] - The integration of S and P EMEA is progressing well, with projected synergies of $40-50 million by the end of the year [12][14] Q&A Session Summary Question: Can you discuss the current volume run rate across major businesses and expectations for SMT EMEA? - Management indicated a slight decline in the paper can business but expects growth in the third quarter, particularly in metal cans [40][42] - EMEA volumes were down due to sardine availability and a late vegetable harvest, but recovery is anticipated in the third quarter [44][46] Question: What are the expectations for stranded costs and interest expenses moving forward? - Management expects improvements in stranded costs and a reduction in interest expenses in the second half of the year [61][62] Question: How are tariff impacts affecting the business? - Management noted that tariffs are being mitigated, but they could impact retail and consumer behavior [75][76] Question: Can you provide details on the EBITDA expectations for the EVO business? - Management confirmed expectations for year-over-year EBITDA growth and highlighted significant new contracts that will contribute to future volumes [69][70] Question: What is the outlook for the consumer segment's sustainability? - Management expressed confidence in maintaining strong performance in the consumer segment, driven by ongoing investments and new product launches [110][112]

Financial Performance - Revenue reached $1.91 billion, a 49% increase compared to the previous year, driven by the SMP EMEA acquisition, strong SMP US demand, favorable pricing, and FX[15, 20, 41] - Adjusted Operating Profit increased by 74% to $247 million, due to favorable price/cost, SMP EMEA acquisition, and productivity[16, 20, 41] - Adjusted EBITDA increased by 25% to $328 million, with a margin of 17.2%, up 101 bps[17, 18, 41] - Adjusted Earnings Per Share (EPS) increased by 7% to $1.37[18, 41] Segment Performance - Consumer Packaging sales increased by 110% to $1.227 billion, with Adjusted EBITDA up 115% to $213 million, and Volume/Mix up ~3%[20, 43] - Industrial Paper Packaging Adjusted EBITDA increased by 16% to $113 million, despite a 2% decrease in sales to $588 million[20, 46] - All Other segment sales remained flat at $95 million, with Adjusted EBITDA decreasing by 8% to $16 million[49] Strategic Initiatives and Outlook - The company divested Thermoformed and Flexibles Packaging to Toppan Holdings and significantly reduced Net Debt by ~$1.8 billion[26] - The company is projecting full-year 2025 Net Revenue between $7.75 billion and $8 billion, and Adjusted EBITDA between $1.3 billion and $1.4 billion[55] - Capital spending is projected at $360 million for 2025, with projected productivity savings of ~$65 million[62]

[Executive Summary](index=1&type=section&id=Executive%20Summary) This section provides a high-level overview of Sonoco's strong Q2 2025 financial performance, driven by strategic acquisitions, divestitures, and operational improvements [Q2 2025 Performance Highlights](index=1&type=section&id=Q2%202025%20Performance%20Highlights) Sonoco reported strong financial results for Q2 2025, driven by acquisitions and productivity gains. Net sales increased significantly, GAAP net income and EPS saw substantial growth, largely due to the TFP divestiture. Adjusted metrics also showed healthy year-over-year improvement, and the company reduced debt using divestiture proceeds - Second quarter net sales grew to **$1.9 billion**, a **49.4% increase** from the prior-year quarter, primarily due to acquisitions[5](index=5&type=chunk) - GAAP net income attributable to Sonoco was **$493 million**, up from **$91 million** in Q2 2024, with **$425 million** of the increase attributed to the sale of the TFP businesses[5](index=5&type=chunk) - Adjusted net income attributable to Sonoco improved by **7.4% year-over-year** to **$136 million**, and adjusted diluted EPS reached **$1.37**[5](index=5&type=chunk) - Adjusted EBITDA for the second quarter was **$328 million**, a **25.1% increase** from the prior-year quarter[5](index=5&type=chunk) - Total debt and net debt were reduced by approximately **$1.7 billion** and **$1.9 billion**, respectively, during the quarter, utilizing divestiture proceeds and operating cash flow[5](index=5&type=chunk) [Consolidated Financial Results](index=2&type=section&id=Consolidated%20Financial%20Results) This section details Sonoco's GAAP and non-GAAP financial performance for Q2 2025, highlighting significant growth driven by acquisitions, divestitures, and operational efficiencies [GAAP Results](index=2&type=section&id=GAAP%20Results) Sonoco's GAAP consolidated results for Q2 2025 showed significant growth across key metrics compared to Q2 2024, largely influenced by the divestiture of TFP and the acquisition of Eviosys GAAP Results | GAAP Results (Millions USD, except EPS) | June 29, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $1,910 | $1,279 | 49% | | Operating profit | $176 | $96 | 83% | | Net income attributable to Sonoco | $493 | $91 | 443% | | EPS (diluted) | $4.96 | $0.92 | 439% | [Non-GAAP Adjusted Results](index=2&type=section&id=Non-GAAP%20Adjusted%20Results) Adjusted financial metrics for Q2 2025 also demonstrated strong year-over-year improvements, reflecting the company's underlying operational performance excluding certain one-time or non-recurring items Non-GAAP Results | Non-GAAP Results (Millions USD, except EPS) | June 29, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Adjusted operating profit | $247 | $142 | 74% | | Adjusted EBITDA | $328 | $262 | 25% | | Adjusted net income attributable to Sonoco | $136 | $127 | 7% | | Adjusted EPS (diluted) | $1.37 | $1.28 | 7% | [Key Drivers of Performance](index=3&type=section&id=Key%20Drivers%20of%20Performance) The significant increase in net sales was primarily driven by the Eviosys acquisition and price increases. Operating profit benefited from the Metal Packaging EMEA business, a positive price/cost environment, lower restructuring costs, and strong productivity, despite some negative product mix and macroeconomic pressures - Net sales increase of **49.4%** was driven by the acquisition of Metal Packaging EMEA (Eviosys), price increases to offset inflation and tariffs, and favorable foreign exchange rates[7](index=7&type=chunk) - GAAP operating profit increased due to contributions from Metal Packaging EMEA, a positive price/cost environment, reduced restructuring costs, and productivity gains from procurement savings, production efficiencies, and fixed cost reductions[7](index=7&type=chunk) - Overall sales volumes (excluding Eviosys) were essentially **flat**, with solid Consumer Packaging segment volume growth offsetting declines in Industrial Paper Packaging[7](index=7&type=chunk) - Effective tax rates on GAAP net income and adjusted net income were **37.3%** and **25.6%** respectively in Q2 2025, compared to **23.3%** and **26.2%** in Q2 2024[7](index=7&type=chunk) [Segment Performance](index=3&type=section&id=Segment%20Performance) This section analyzes the financial performance of Sonoco's Consumer Packaging, Industrial Paper Packaging, and All Other segments, highlighting key drivers and changes in sales and profitability [Consumer Packaging Segment](index=3&type=section&id=Consumer%20Packaging%20Segment) The Consumer Packaging segment experienced substantial growth in Q2 2025, primarily due to the Eviosys acquisition and strong performance in U.S. Metal Packaging, leading to significant increases in net sales, operating profit, and adjusted EBITDA Consumer Segment | Consumer Segment (Millions USD, except margins) | June 29, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $1,227 | $583 | 110% | | Segment operating profit | $160 | $74 | 117% | | Segment operating profit margin | 13% | 13% | 0 pp | | Segment Adjusted EBITDA | $213 | $99 | 115% | | Segment Adjusted EBITDA margin | 17% | 17% | 0 pp | - Consumer segment net sales grew **110%**, driven by sales from Metal Packaging EMEA (Eviosys acquisition), strong year-over-year volume growth in Metal Packaging U.S., and favorable foreign exchange rates[12](index=12&type=chunk) - Segment operating profit and adjusted EBITDA grew primarily due to profits from Metal Packaging EMEA, productivity improvements, and volume/mix gains in the U.S. metal packaging business[12](index=12&type=chunk) [Industrial Paper Packaging Segment](index=3&type=section&id=Industrial%20Paper%20Packaging%20Segment) The Industrial Paper Packaging segment saw a slight decrease in net sales due to volume declines and divestitures, but improved its operating profit and adjusted EBITDA margins through positive price/cost dynamics and productivity initiatives Industrial Segment | Industrial Segment (Millions USD, except margins) | June 29, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $588 | $601 | (2)% | | Segment operating profit | $81 | $67 | 21% | | Segment operating profit margin | 14% | 11% | 3 pp | | Segment Adjusted EBITDA | $113 | $98 | 16% | | Segment Adjusted EBITDA margin | 19% | 16% | 3 pp | - Industrial segment net sales decreased **2%** to **$588 million**, primarily due to volume declines and the divestiture of two production facilities in China, partially offset by price increases and favorable foreign exchange rates[10](index=10&type=chunk) - Segment operating profit margin increased to **14%** and adjusted EBITDA margin increased to **19%**, driven by positive price/cost and productivity from procurement savings, production efficiencies, and fixed cost reduction initiatives[11](index=11&type=chunk) [All Other Businesses](index=4&type=section&id=All%20Other%20Businesses) The 'All Other' businesses maintained flat net sales in Q2 2025, but experienced a decline in operating profit and adjusted EBITDA due to lower volumes in industrial plastics and negative price/cost All Other | All Other (Millions USD, except margins) | June 29, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $95 | $95 | 0% | | Operating profit | $13 | $14 | (5)% | | Operating profit margin | 14% | 15% | (1) pp | | Adjusted EBITDA | $16 | $17 | (5)% | | Adjusted EBITDA margin | 17% | 17% | 0 pp | - Net sales were **flat** as volume gains in temperature-assured packaging were offset by lower volume from industrial plastics[15](index=15&type=chunk) - Operating profit and adjusted EBITDA both declined **5% year over year** due to lower volumes from industrial plastics and negative price/cost[15](index=15&type=chunk) [Financial Position and Cash Flow](index=4&type=section&id=Financial%20Position%20and%20Cash%20Flow) This section reviews Sonoco's balance sheet and cash flow performance, highlighting significant debt reduction from divestiture proceeds and changes in operating cash flow [Balance Sheet Highlights](index=4&type=section&id=Balance%20Sheet%20Highlights) Sonoco significantly reduced its total and net debt in Q2 2025, primarily by using proceeds from the TFP divestiture to repay borrowings. The company maintained substantial available liquidity - Cash and cash equivalents were **$330 million** as of June 29, 2025, down from **$443 million** at December 31, 2024, mainly due to changes in net working capital[16](index=16&type=chunk) - Total debt and net debt decreased by **$1.7 billion** and **$1.5 billion**, respectively, compared to December 31, 2024, primarily from repaying a **$1.5 billion** term loan using TFP sale proceeds[16](index=16&type=chunk) - Available liquidity stood at **$1,225 million** on June 29, 2025, including **$895 million** in revolving credit facility capacity and cash on hand[16](index=16&type=chunk) [Cash Flow Highlights](index=4&type=section&id=Cash%20Flow%20Highlights) Operating cash flow for the first half of 2025 was an outflow, a significant change from the prior year, mainly due to increased working capital needs for Metal Packaging EMEA, which is expected to reverse in H2 2025. Capital expenditures increased slightly, leading to negative free cash flow - Cash flow from operating activities for the six months ended June 29, 2025, was an outflow of **$(15) million**, compared to an inflow of **$275 million** in the same period of 2024[16](index=16&type=chunk) - The change in operating cash flow was driven by increased seasonal working capital needs for Metal Packaging EMEA, expected to reverse in the second half of the year[16](index=16&type=chunk) - Capital expenditures, net, for the first half of 2025 were **$186 million**, up from **$179 million** in the prior year[16](index=16&type=chunk) - Free Cash Flow for the first six months of 2025 was **$(201) million**, compared to **$96 million** in the same period of 2024[16](index=16&type=chunk) - Dividends paid increased to **$104 million** in H1 2025 from **$101 million** in H1 2024[16](index=16&type=chunk) [Full-Year 2025 Guidance](index=5&type=section&id=Full-Year%202025%20Guidance) Sonoco is maintaining its full-year 2025 guidance for adjusted EBITDA and has updated its adjusted diluted EPS target to the lower end of previous guidance. The company anticipates strong performance in Consumer Packaging and continued benefits from improved market conditions and operational excellence in Industrial Paper Packaging, while remaining mindful of macroeconomic uncertainties - Maintaining full-year 2025 guidance for adjusted EBITDA of between **$1.3 billion** to **$1.4 billion**[5](index=5&type=chunk)[20](index=20&type=chunk) - Updated expected adjusted diluted earnings per share to a target of approximately **$6.00**, or the low end of previous full-year guidance (**$6.00 to $6.20**)[5](index=5&type=chunk)[20](index=20&type=chunk) - Target for cash flow from operating activities is approximately **$800 million**, or the lower end of previous guidance (**$800 million to $900 million**)[20](index=20&type=chunk) - Expects continued strong performance in Consumer Packaging, with U.S. Metal Packaging organically growing above industry rates and Metal Packaging EMEA exceeding synergy savings[17](index=17&type=chunk) - Industrial Paper Packaging segment is projected to have another strong quarter, benefiting from improved market conditions and margin expansion initiatives[17](index=17&type=chunk) [Company Information & Disclosures](index=7&type=section&id=Company%20Information%20%26%20Disclosures) This section provides an overview of Sonoco's global operations and its commitment to sustainability, along with important disclosures regarding forward-looking statements and associated risks [About Sonoco](index=7&type=section&id=About%20Sonoco) Sonoco is a global leader in sustainable metal and fiber consumer and industrial packaging, operating in 40 countries with approximately 23,400 employees. The company focuses on innovation, collaboration, and sustainability, and was recognized as one of America's Most Trustworthy and Responsible Companies in 2025 - Sonoco is a global leader in high-value sustainable metal and fiber consumer and industrial packaging[23](index=23&type=chunk) - The company operates in **40 countries** with approximately **23,400 employees**[23](index=23&type=chunk) - Sonoco was named one of America's Most Trustworthy and Responsible Companies by Newsweek in 2025[23](index=23&type=chunk) [Forward-Looking Statements](index=7&type=section&id=Forward-Looking%20Statements) This section identifies forward-looking statements regarding Sonoco's future performance, outlook, strategic initiatives, and the impact of macroeconomic factors. These statements are based on current expectations and are subject to various risks and uncertainties that could cause actual results to differ materially - Forward-looking statements include those regarding future operating and financial performance, full-year 2025 outlook, working capital expectations, ability to manage costs, and benefits from divestitures[25](index=25&type=chunk) - These statements are based on current expectations, estimates, and projections, and are not guarantees of future performance[26](index=26&type=chunk) - Risks and uncertainties include the ability to execute strategy, credit market conditions, raw material pricing, inflation, consumer demand fluctuations, and regulatory changes[28](index=28&type=chunk) [Unaudited Financial Statements](index=9&type=section&id=Unaudited%20Financial%20Statements) This section provides the unaudited condensed consolidated statements of income, cash flows, and balance sheets, along with detailed financial segment information for the reported periods [Condensed Consolidated Statements of Income](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) This table presents the unaudited condensed consolidated statements of income for the three and six months ended June 29, 2025, and June 30, 2024, detailing net sales, gross profit, operating profit, net income, and diluted EPS Condensed Consolidated Statements of Income | (Dollars in thousands except per share data) | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 29, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $1,910,441 | $1,278,801 | $3,619,669 | $2,587,437 | | Gross profit | $406,277 | $285,243 | $759,964 | $556,408 | | Operating profit | $175,667 | $95,811 | $302,527 | $168,383 | | Net income attributable to Sonoco | $493,423 | $90,811 | $547,852 | $155,988 | | Diluted earnings attributable to Sonoco per common share | $4.96 | $0.92 | $5.51 | $1.57 | [Condensed Statements of Income for Discontinued Operations](index=10&type=section&id=Condensed%20Statements%20of%20Income%20for%20Discontinued%20Operations) This table provides the unaudited condensed statements of income specifically for discontinued operations for the three and six months ended June 29, 2025, and June 30, 2024, including net sales, operating profit, and net income from these operations Condensed Statements of Income for Discontinued Operations | (Dollars in thousands except per share data) | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 29, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $— | $344,678 | $320,678 | $673,585 | | Operating profit | $625,773 | $44,561 | $663,564 | $84,442 | | Net income from discontinued operations | $424,548 | $33,540 | $429,720 | $63,301 | | Diluted earnings from discontinued operations per common share | $4.27 | $0.34 | $4.32 | $0.64 | [Financial Segment Information](index=11&type=section&id=Financial%20Segment%20Information) This table details the unaudited net sales and operating profit for Sonoco's reportable segments (Consumer Packaging, Industrial Paper Packaging) and All Other businesses for the three and six months ended June 29, 2025, and June 30, 2024 Financial Segment Information | (Dollars in thousands) | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 29, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales:** | | | | | | Consumer Packaging | $1,227,033 | $583,051 | $2,293,626 | $1,164,721 | | Industrial Paper Packaging | $588,239 | $600,770 | $1,145,948 | $1,193,830 | | All Other | $95,169 | $94,980 | $180,095 | $228,886 | | **Operating profit:** | | | | | | Consumer Packaging | $160,353 | $73,756 | $301,124 | $132,323 | | Industrial Paper Packaging | $81,231 | $66,958 | $152,355 | $132,802 | | All Other | $13,109 | $13,865 | $25,035 | $30,990 | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This table presents the unaudited condensed consolidated statements of cash flows for the six months ended June 29, 2025, and June 30, 2024, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows | (Dollars in thousands) | Six Months Ended June 29, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income | $547,688 | $156,224 | | Net cash (used)/provided by operating activities | $(14,653) | $275,489 | | Purchases of property, plant and equipment, net | $(186,393) | $(179,361) | | Proceeds from the sale of business, net | $1,814,930 | $81,517 | | Net debt repayments | $(1,668,876) | $(71,244) | | Cash dividends | $(103,558) | $(101,310) | | Net decrease in cash and cash equivalents | $(113,260) | $(11,704) | | Cash and cash equivalents at end of period | $329,800 | $140,233 | [Condensed Consolidated Balance Sheets](index=13&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This table provides the unaudited condensed consolidated balance sheets as of June 29, 2025, and December 31, 2024, outlining assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets | (Dollars in thousands) | June 29, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets:** | | | | Total Current Assets | $3,036,618 | $3,178,560 | | Property, plant and equipment, net | $2,883,135 | $2,718,747 | | Goodwill | $2,678,045 | $2,525,657 | | Total Assets | $11,970,424 | $12,507,790 | | **Liabilities and Shareholders' Equity:** | | | | Total Current Liabilities | $2,423,174 | $4,038,291 | | Long-term debt, net of current portion | $4,986,643 | $4,985,496 | | Total equity | $3,250,833 | $2,286,213 | | Total Liabilities and Shareholders' Equity | $11,970,424 | $12,507,790 | [Non-GAAP Financial Measures & Reconciliations](index=14&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines Sonoco's non-GAAP financial measures and provides detailed reconciliations to their most directly comparable GAAP measures for both quarterly and year-to-date periods [Definition of Non-GAAP Measures](index=14&type=section&id=Definition%20of%20Non-GAAP%20Measures) Sonoco uses non-GAAP financial measures like 'adjusted operating profit,' 'adjusted net income,' 'adjusted diluted EPS,' 'Adjusted EBITDA,' 'Adjusted EBITDA Margin,' 'Net Debt,' and 'Net Leverage' to provide a clearer view of its underlying financial performance by excluding specific items such as restructuring charges, acquisition-related costs, and gains/losses from divestitures. These measures are used for internal planning, performance evaluation, and investor guidance - Non-GAAP measures adjust GAAP results to exclude items like restructuring charges, acquisition/divestiture costs, gains/losses from asset sales, non-operating pension costs, and amortization of acquisition intangibles[44](index=44&type=chunk)[49](index=49&type=chunk) - Adjusted EBITDA is defined as net income excluding interest, taxes, depreciation, amortization, non-operating pension costs, and other specific adjustments[46](index=46&type=chunk) - Free Cash Flow is defined as cash flow from operations minus net capital expenditures[54](index=54&type=chunk) - These non-GAAP measures are used for internal planning, evaluating ongoing operations, assessing management performance, and providing earnings guidance[51](index=51&type=chunk) [Quarterly Reconciliations](index=16&type=section&id=Quarterly%20Reconciliations) This section provides detailed reconciliations of Sonoco's GAAP financial measures to their corresponding non-GAAP adjusted measures for the three-month periods ended June 29, 2025, and June 30, 2024, covering adjusted operating profit, net income, EPS, and Adjusted EBITDA by segment Adjusted Operating Profit, Net Income, EPS (Q2 2025) | Dollars in thousands, except per share data | Operating Profit | Income Before Income Taxes | Provision for Income Taxes | Net Income Attributable to Sonoco | Diluted EPS | | :--- | :--- | :--- | :--- | :--- | :--- | | As Reported (GAAP) | $175,667 | $105,881 | $39,500 | $493,423 | $4.96 | | Total adjustments | $71,271 | $74,253 | $6,631 | $(357,308) | $(3.59) | | Adjusted | $246,938 | $180,134 | $46,131 | $136,115 | $1.37 | Adjusted Operating Profit, Net Income, EPS (Q2 2024) | Dollars in thousands, except per share data | Operating Profit | Income Before Income Taxes | Provision for Income Taxes | Net Income Attributable to Sonoco | Diluted EPS | | :--- | :--- | :--- | :--- | :--- | :--- | | As Reported (GAAP) | $95,811 | $71,893 | $16,756 | $90,811 | $0.92 | | Total adjustments | $46,134 | $44,858 | $13,856 | $35,946 | $0.36 | | Adjusted | $141,945 | $116,751 | $30,612 | $126,757 | $1.28 | Adjusted EBITDA (Q2) | Dollars in thousands | June 29, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net income attributable to Sonoco | $493,423 | $90,811 | | Total Adjustments | $(165,492) | $171,403 | | Adjusted EBITDA | $327,931 | $262,214 | Segment Adjusted EBITDA (Q2 2025) | Dollars in thousands | Consumer | Industrial | All Other | Corporate | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Segment and Total Operating Profit | $160,353 | $81,231 | $13,109 | $(79,026) | $175,667 | | Total Adjustments | $52,971 | $31,938 | $2,643 | $64,712 | $152,264 | | Segment Adjusted EBITDA | $213,324 | $113,169 | $15,752 | $(14,314) | $327,931 | | Segment Adjusted EBITDA Margin | 17.4% | 19.2% | 16.6% | | | Segment Adjusted EBITDA (Q2 2024) | Dollars in thousands | Consumer | Industrial | All Other | Corporate | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Segment and Total Operating Profit | $73,756 | $66,958 | $13,865 | $(58,768) | $95,811 | | Total Adjustments | $25,267 | $30,880 | $2,717 | $46,134 | $104,998 | | Segment Adjusted EBITDA | $99,023 | $97,838 | $16,582 | $(12,634) | $200,809 | | Segment Adjusted EBITDA Margin | 17.0% | 16.3% | 17.5% | | | [Year-to-Date Reconciliations](index=21&type=section&id=Year-to-Date%20Reconciliations) This section provides detailed reconciliations of Sonoco's GAAP financial measures to their corresponding non-GAAP adjusted measures for the six-month periods ended June 29, 2025, and June 30, 2024, covering adjusted operating profit, net income, EPS, and Adjusted EBITDA by segment Adjusted Operating Profit, Net Income, EPS (YTD 2025) | Dollars in thousands, except per share data | Operating Profit | Income Before Income Taxes | Provision for Income Taxes | Net Income Attributable to Sonoco | Diluted EPS | | :--- | :--- | :--- | :--- | :--- | :--- | | As Reported (GAAP) | $302,527 | $174,424 | $60,647 | $547,852 | $5.51 | | Total adjustments | $157,134 | $163,237 | $26,037 | $(274,897) | $(2.77) | | Adjusted | $459,661 | $337,661 | $86,684 | $272,955 | $2.74 | Adjusted Operating Profit, Net Income, EPS (YTD 2024) | Dollars in thousands, except per share data | Operating Profit | Income Before Income Taxes | Provision for Income Taxes | Net Income Attributable to Sonoco | Diluted EPS | | :--- | :--- | :--- | :--- | :--- | :--- | | As Reported (GAAP) | $168,383 | $114,139 | $24,627 | $155,988 | $1.57 | | Total adjustments | $104,010 | $106,030 | $33,124 | $82,262 | $0.83 | | Adjusted | $272,393 | $220,169 | $57,751 | $238,250 | $2.40 | Adjusted EBITDA (YTD) | Dollars in thousands | June 29, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net income attributable to Sonoco | $547,852 | $155,988 | | Total Adjustments | $117,835 | $350,979 | | Adjusted EBITDA | $665,687 | $506,967 | Segment Adjusted EBITDA (YTD 2025) | Dollars in thousands | Consumer | Industrial | All Other | Corporate | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Segment and Total Operating Profit | $301,124 | $152,355 | $25,035 | $(175,987) | $302,527 | | Total Adjustments | $101,875 | $62,243 | $5,197 | $144,058 | $313,373 | | Segment Adjusted EBITDA | $402,999 | $214,598 | $30,232 | $(31,929) | $615,900 | | Segment Adjusted EBITDA Margin | 17.6% | 18.7% | 16.8% | | | Segment Adjusted EBITDA (YTD 2024) | Dollars in thousands | Consumer | Industrial | All Other | Corporate | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Segment and Total Operating Profit | $132,323 | $132,802 | $30,990 | $(127,732) | $168,383 | | Total Adjustments | $50,176 | $60,508 | $6,369 | $103,990 | $221,043 | | Segment Adjusted EBITDA | $182,499 | $193,310 | $37,359 | $(23,722) | $389,446 | | Segment Adjusted EBITDA Margin | 15.7% | 16.2% | 16.3% | | | [Free Cash Flow Reconciliation](index=26&type=section&id=Free%20Cash%20Flow%20Reconciliation) This table reconciles net cash (used)/provided by operating activities to Free Cash Flow for the six months ended June 29, 2025, and June 30, 2024 FREE CASH FLOW | FREE CASH FLOW (Dollars in thousands) | June 29, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Net cash (used)/provided by operating activities | $(14,653) | $275,489 | | Purchase of property, plant and equipment, net | $(186,393) | $(179,361) | | Free Cash Flow | $(201,046) | $96,128 | [Investor Information](index=5&type=section&id=Investor%20Information) This section provides details for investors regarding the upcoming conference call to discuss Q2 2025 results and contact information for investor relations inquiries [Conference Call Webcast Details](index=5&type=section&id=Conference%20Call%20Webcast%20Details) Sonoco will host a conference call on Thursday, July 24, 2025, at 8:00 a.m. Eastern Time to discuss the second quarter 2025 results. A live audio webcast and supporting materials will be available on the Sonoco Investor Relations website, with a replay available for at least 30 days - Conference call to discuss Q2 2025 results will be held on **Thursday, July 24, 2025, at 8:00 a.m. Eastern Time**[19](index=19&type=chunk)[20](index=20&type=chunk) - A live audio webcast and supporting materials will be available on the Sonoco Investor Relations website (https://investor.sonoco.com/)[19](index=19&type=chunk) - A webcast replay will be available on the company's website for at least **30 days**[19](index=19&type=chunk) - Telephone participants need to register in advance to receive a dial-in number and unique PIN[21](index=21&type=chunk) [Contact Information](index=6&type=section&id=Contact%20Information) Contact information for investor relations is provided for inquiries regarding the company's financial results - Contact: Roger Schrum, Interim Head of Investor Relations and Communications[22](index=22&type=chunk) - Email: roger.schrum@sonoco.com, Phone: **843-339-6018**[22](index=22&type=chunk)

Core Viewpoint - Sonoco Products Company reported strong financial results for the second quarter of 2025, with significant increases in net sales and net income, primarily driven by acquisitions and operational efficiencies [5][10][19]. Financial Performance - Consolidated net sales reached $1.91 billion, a 49% increase from the prior year, largely due to acquisitions [4][5]. - GAAP net income attributable to Sonoco was $493 million, up 443% from $91 million in the same period in 2024 [4][5]. - Diluted earnings per share (EPS) increased to $4.96, a 439% rise compared to $0.92 in the previous year [4][5]. - Adjusted operating profit for the quarter was $247 million, a 74% increase year-over-year [4][5]. - Adjusted EBITDA was $328 million, reflecting a 25% increase from the prior year [4][5]. Segment Performance - Consumer Packaging segment net sales grew by 110% to $1.23 billion, driven by the acquisition of Metal Packaging EMEA and strong performance in the U.S. [9][11]. - Industrial Paper Packaging segment net sales decreased by 2% to $588 million, impacted by volume declines [12][16]. - The Consumer Packaging segment achieved an adjusted EBITDA margin of 17%, while the Industrial segment's adjusted EBITDA margin increased to 19% [9][12]. Cash Flow and Debt Management - Operating cash flow for the second quarter was $193 million, with a year-to-date outflow of $15 million [5][18]. - Total debt was reduced by approximately $1.7 billion during the quarter, primarily through divestiture proceeds [5][18]. - The company maintained available liquidity of $1.225 billion, consisting of cash and borrowing capacity [18]. Guidance and Outlook - Sonoco expects continued strong performance in the Consumer Packaging segment for the second half of 2025, with adjusted EBITDA guidance set between $1.3 billion to $1.4 billion [5][19]. - The company anticipates adjusted diluted EPS to target approximately $6.00 for the full year [5][19].

Core Viewpoint - The market anticipates Sonoco (SON) will report a year-over-year increase in earnings driven by higher revenues when it releases its quarterly results for June 2025 [1] Earnings Expectations - The upcoming earnings report is expected on July 23, with a consensus estimate of $1.44 per share, reflecting a 12.5% increase year-over-year, and revenues projected at $1.9 billion, up 16.8% from the previous year [3] - Actual results that exceed these expectations could lead to a rise in stock price, while a miss may result in a decline [2] Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised down by 1.24%, indicating a reassessment by analysts regarding the company's earnings prospects [4] - The Most Accurate Estimate for Sonoco is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.56%, suggesting a bearish outlook from analysts [12] Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict the deviation of actual earnings from consensus estimates, with positive readings being more reliable [9][10] - Stocks with a positive Earnings ESP and a Zacks Rank of 1, 2, or 3 have historically shown a nearly 70% chance of delivering a positive surprise [10] Historical Performance - In the last reported quarter, Sonoco was expected to post earnings of $1.39 per share but delivered $1.38, resulting in a surprise of -0.72% [13] - Over the past four quarters, Sonoco has beaten consensus EPS estimates twice [14] Conclusion - Sonoco does not currently appear to be a strong candidate for an earnings beat, and investors should consider other factors when making decisions regarding the stock ahead of the earnings release [17]

Core Viewpoint - Sonoco Products Company announces a $30 million capital investment to expand production capacity in the adhesives and sealants market, adding 100 million units of annual capacity to meet growing market demands [1][6]. Investment Details - The investment will enhance existing production lines and install new ones, demonstrating Sonoco's commitment to innovation and customer satisfaction [2]. - The expansion will be distributed across three strategically located facilities to enhance supply chain resilience and ensure reliable access to materials for customers [3]. Market Positioning - Sonoco aims to support evolving customer needs by investing in the latest technology and production efficiencies, reinforcing its position as a trusted partner in the adhesives and sealants market [3][6]. - The company is recognized as a leader in the packaging industry, committed to providing high-quality, efficient, and sustainable solutions as demand for adhesives and sealants continues to grow [6]. Community Impact - Local officials highlight the positive impact of Sonoco's investment on the regional economy, emphasizing the importance of supporting businesses that diversify the economy [4]. - The Orlando Economic Partnership expresses commitment to assist Sonoco in its expansion efforts, showcasing the region's ability to attract investment and create jobs [5]. Company Overview - Founded in 1899, Sonoco is a global leader in sustainable packaging with approximately 23,400 employees across 285 operations in 40 countries, serving well-known brands [7]. - The company is recognized for its commitment to innovation and operational excellence, aiming for a sustainable future [6][7].