Berry (BERY) - 2024 Q3 - Quarterly Report

Financial Performance - Net sales for the quarter ended June 29, 2024, were $3.161 billion, a decrease of 2% compared to the prior quarter's$ 3.229 billion, primarily due to decreased selling prices [50]. - Operating income for the quarter increased by 13% to $303 million, driven by a favorable impact from volume increases and a decline in business integration expenses [51]. - The Consumer Packaging North America segment reported net sales of$ 831 million, a 4% increase from the prior quarter, attributed to 2% organic volume growth and improved product mix [56]. - The Health, Hygiene & Specialties segment experienced a 2% decline in net sales to $647 million, primarily due to decreased selling prices, although operating income increased by 55% to$ 34 million [58]. - The Flexibles segment's net sales decreased by 2% to $724 million, with operating income slightly declining by 1% to$ 87 million [59]. - Year-to-date net sales were $9.090 billion, a 5% decrease from the prior year, primarily due to lower selling prices and a 1% volume decline [63]. - The Consumer Packaging International segment's year-to-date net sales declined by 6% to$ 2.844 billion, impacted by decreased selling prices and divestitures [65]. - The Health, Hygiene & Specialties segment's year-to-date net sales decreased by 5% to $1.896 billion, with operating income down 28% to$ 64 million due to price cost spread impacts [71]. - Net sales for the year-to-date (YTD) decreased to $2,069 million, a decline of 7% compared to$ 2,214 million in the prior YTD, primarily due to a $118 million decrease in selling prices and a 2% volume decline [72]. - Operating income increased slightly to$ 248 million, up 1% from $246 million, driven by a$ 13 million favorable impact from price cost spread, partially offset by a $9 million increase in depreciation and amortization [72]. - Comprehensive income declined by$ 337 million from the prior YTD, mainly due to a $218 million unfavorable change in currency translation and a$ 64 million unfavorable change in the fair value of derivative instruments [73]. Cash Flow and Liquidity - For fiscal 2024, the company projects cash flow from operations of $1.4 billion and free cash flow of$ 800 million, assuming $600 million of capital spending [48]. - Net cash from operating activities decreased by$ 193 million from the prior YTD, primarily due to higher working capital needs [75]. - Free cash flow for the YTD was $(176) million, compared to$ (70) million in the prior YTD, indicating a decline in cash generation capabilities [77]. - The company had a cash balance of $509 million as of June 29, 2024, primarily located outside the U.S., and plans to refinance long-term debt obligations prior to maturity [78]. - The company repurchased approximately 2.0 million shares for$ 117 million in the YTD, with $324 million remaining available for share repurchases [77]. - The company’s senior secured credit facilities include$ 2.0 billion in term loans and a $1.0 billion revolving credit facility, with no borrowings outstanding as of the period end [84]. Foreign Exchange and Compliance - A 10% decline in foreign currency exchange rates would have resulted in a$ 9 million unfavorable impact on net income for the three quarterly periods ended June 29, 2024 [85]. - The company was in compliance with all covenants related to its $1,000 million asset-based revolving line of credit as of the end of the quarter [74]. Supply Chain Management - The company continues to manage supply chain disruptions and raw material price changes through close collaboration with suppliers and customers [47].