Ranpak (PACK) - 2024 Q3 - Quarterly Report

Revenue Performance - Ranpak generated net revenue of $263.9 million for the nine months ended September 30, 2024, compared to$245.9 million for the same period in 2023, representing a year-over-year increase of approximately 7.9%[98] - Net revenue for Q3 2024 was $92.2 million, an increase of$9.4 million or 11.4% compared to $82.8 million in Q3 2023[115] - Net revenue for the nine months ended September 30, 2024, was$263.9 million, an increase of $18.0 million or 7.3$245.9 million in the same period of 2023[132] - North America net revenue for Q3 2024 was $40.3 million, an increase of$5.4 million or 15.5% from $34.9 million in Q3 2023[116] - Europe/Asia net revenue for Q3 2024 was$51.9 million, an increase of $4.0 million or 8.4$47.9 million in Q3 2023[117] - North America net revenue for the nine months ended September 30, 2024, was $109.9 million, an increase of$11.7 million or 11.9% from $98.2 million in 2023[133] - Europe/Asia net revenue for the nine months ended September 30, 2024, was$154.0 million, an increase of $6.3 million or 4.3$147.7 million in 2023[134] Cost and Expenses - Cost of goods sold for Q3 2024 totaled $57.8 million, an increase of$6.5 million or 12.7% from $51.3 million in Q3 2023[118] - Cost of goods sold for the nine months ended September 30, 2024, totaled$165.5 million, an increase of $8.8 million or 5.6$156.7 million in 2023[135] - Selling, general and administrative expenses (SG&A) for Q3 2024 were $28.8 million, up$7.9 million or 37.8% from 20.9 million in Q3 2023[119] - Selling, general and administrative expenses (SG&A) increased by 19.6 million or 30.4% to $84.0 million for the nine months ended September 30, 2024, compared to$64.4 million in 2023[136] Profitability and Loss - Net loss for Q3 2024 increased to $8.1 million from a net loss of$3.3 million in Q3 2023, a change of $4.8 million[126] - Net loss for the nine months ended September 30, 2024, decreased to$10.7 million from a net loss of $17.8 million in 2023, a change of$7.1 million[143] - EBITDA for Q3 2024 was $12.6 million, a decrease of$6.2 million or 33.0% compared to $18.8 million in Q3 2023[127] - EBITDA for the nine months ended September 30, 2024, was$57.3 million, an increase of $10.2 million or 21.7$47.1 million in 2023[144] - AEBITDA (Constant Currency) for Q3 2024 was $20.5 million, an increase of$2.5 million or 13.9% year over year[127] - AEBITDA for the nine months ended September 30, 2024, totaled $61.1 million, representing an increase of$9.0 million or 17.3% from $52.1 million in 2023[144] Cash Flow and Debt - Cash and cash equivalents as of September 30, 2024, were$69.5 million, up from $62.0 million as of December 31, 2023[151] - Total debt as of September 30, 2024, was$408.2 million, with $2.7 million classified as short-term[151] - Net cash provided by operating activities was$34.9 million for the nine months ended September 30, 2024, compared to $23.0 million for the same period in 2023, largely due to a patent litigation settlement of$16.1 million[155] - Net cash used in investing activities was $24.7 million for the nine months ended September 30, 2024, which included an additional investment of$4.8 million in Pickle, while cash inflows from the sale of two patents amounted to $5.4 million[156] - Net cash used in financing activities was$2.3 million for the nine months ended September 30, 2024, reflecting debt repayments and payments on finance lease liabilities[157] Market and Operational Insights - Approximately 30% of Ranpak's net revenue in 2023 was derived from e-commerce sectors, which typically experience seasonal sales peaks during the fourth quarter[105] - The company operates manufacturing facilities in the United States and Europe, with 59% of its 2023 net revenue generated outside the United States[97] - The company expects continued pressure on gross margins in the medium term due to rising input costs and competitive market conditions[101] - The cost of paper, a key component of goods sold, is subject to significant fluctuations, impacting gross margins and overall operating results[100] - Currency fluctuations affect the comparability of results, with the company using a cross-currency swap to hedge some exposure[104] - The company expects capital expenditures to increase as it continues to grow its business and expand its manufacturing footprint[150] Other Financial Information - Other non-operating income for Q3 2024 was $3.1 million, compared to$0.1 million in Q3 2023, primarily due to an unrealized gain on investment[124] - Other non-operating income for the nine months ended September 30, 2024, was $21.0 million, primarily from$16.1 million in litigation proceeds and a $5.4 million gain on the sale of patents[141] - Interest expense for Q3 2024 was$9.3 million, an increase of $2.5 million or 36.8$6.8 million in Q3 2023[122] - Interest expense for the nine months ended September 30, 2024, was $20.8 million, an increase of$2.4 million or 13.0% from $18.4 million in 2023[139] - The interest rate for the First Lien Dollar Term Facility as of September 30, 2024, was 9.05%, down from 9.44% as of December 31, 2023[151] Impairment and Off-Balance Sheet Arrangements - As of September 30, 2024, there were no indicators of impairment for goodwill or long-lived assets[163] - The company has not engaged in any off-balance sheet arrangements as of September 30, 2024[159] - There have been no significant changes to the company's contractual obligations outside the ordinary course of business[158]