Ranpak (PACK) - 2023 Q4 - Annual Report

Revenue Breakdown - In 2023, the Void-Fill products generated $133.9 million in revenue, accounting for 39.8% of the company's net revenue[21] - The Cushioning products generated $145.8 million in revenue in 2023, representing 43.4% of the company's net revenue[21] - Wrapping products generated $36.0 million in revenue in 2023, which accounted for 10.7% of the company's net revenue[24] - In 2023, approximately 89% of the company's net revenue was derived from sales to distributors, while direct sales to end-users accounted for about 11%[32][33] - Sales to e-commerce end-users accounted for approximately 30% of net revenue in 2023, highlighting the importance of this segment for growth[45] - Sales to industrial manufacturing end-users accounted for approximately 12.6% of net revenue in 2023, driven by demand from growing populations and expanding middle classes[46] - The automotive after-market accounted for approximately 9.0% of net revenue in 2023, with demand driven by the need for replacement parts and customization[47] - Sales to electronics end-users accounted for approximately 7.5% of net revenue in 2023, reflecting the growth in consumer electronics and innovation[48] Installed Base and Facilities - The company has an installed base of approximately 83,700 FillPak units as of December 31, 2023[21] - The company has an installed base of approximately 34,800 PadPak units as of December 31, 2023[21] - The company has an installed base of approximately 22,700 Wrapping units as of December 31, 2023[24] - The company has established a full-service paper conversion facility in Malaysia, expected to be operational in the second half of 2024, to enhance service capabilities in the APAC region[36] Sustainability and Environmental Initiatives - The company achieved a significant increase in FSC-certified paper supply, with approximately 86% of raw paper being certified in 2023, up from 55% in 2022[57] - Approximately two-thirds of the pulp used for manufacturing paper consumables in 2023 was recycled fiber, with 57% sourced from post-consumer waste (PCW) globally[57] - The company has committed to sourcing at least 75% recycled pulp and achieving a 46% reduction in greenhouse gas emissions by 2030[61] - The company was recognized with the 2023 SEAL Business Sustainability Award for its sustainable packaging and automation solutions[56] Growth Strategies - The company aims to continue geographic expansion and penetration of existing markets to drive future growth[20] - The company aims to grow through targeted acquisitions and partnerships, including investments in sustainable packaging solutions like Creapaper[44] - The company is focused on expanding its geographic reach, particularly in growth regions such as Asia-Pacific, South America, and Central and Eastern Europe[36] - The APAC region represented less than 10% of net revenue in 2023, indicating significant growth opportunities[44] - The company plans to pursue targeted growth opportunities in areas such as Cold Chain/thermal packaging and automation[44] Compliance and Regulatory Environment - The company is subject to various federal, state, local, and international environmental-related health and safety laws, which may increase regulatory burden and compliance costs[65] - Beginning in 2026, the company will be required to disclose certain environmental, social, and governance impacts, risks, and opportunities for fiscal year 2025 under the Corporate Sustainability Reporting Directive (CSRD)[65] - Compliance with environmental laws and regulations may incur significant costs and adversely affect capital expenditures, earnings, and competitive position[65] Workforce and Diversity - As of December 31, 2023, the company had approximately 800 full-time employees worldwide, with 330 located in the United States[60] - The company has developed robust anti-bias training and diversity initiatives to enhance representation in its workforce and boardroom[58] Innovation and Patents - The company holds over 684 U.S. and foreign patents related to its business innovations[21] - The company is a leader in automated void reduction systems technology and focuses on environmentally friendly fiber-based packaging solutions[54] - The Automation products represented only 6.1% of net revenue in 2023, but the company believes it will serve as a platform for expansion to meet higher volume requirements[35]