Greif(US:GEF)2024-08-29 18:01Financial Performance - Net sales for the three months ended July 31, 2024, increased to $1,454.2 million, up from $1,330.3 million in the same period of 2023, representing a growth of 9.3%[4] - Gross profit for the nine months ended July 31, 2024, was $782.1 million, a decrease of 10.1% compared to $870.4 million for the same period in 2023[4] - Operating profit for the three months ended July 31, 2024, was $171.0 million, compared to $155.6 million in the same period of 2023, reflecting an increase of 9.0%[4] - Net income attributable to Greif, Inc. for the nine months ended July 31, 2024, was $198.7 million, down from $291.4 million in the same period in 2023, a decline of 31.8%[4] - Basic earnings per share for Class A common stock decreased to $1.51 for the three months ended July 31, 2024, from $1.57 in the same period of 2023, a decline of 3.8%[4] - Comprehensive income attributable to Greif, Inc. for the three months ended July 31, 2024, was $73.7 million, down from $101.7 million in the same period of 2023, a decrease of 27.5%[6] - Net income for the nine months ended July 31, 2024, was $219.9 million, a decrease from $305.8 million in the same period last year, representing a decline of approximately 28.1%[14] - Operating profit for the first nine months of 2024 was $338.0 million, down from $493.1 million in the same period of 2023[162] - Net income for the first nine months of 2024 was $219.9 million, compared to $305.8 million in 2023[162] Cash and Liquidity - Cash and cash equivalents increased to $194.2 million as of July 31, 2024, compared to $180.9 million as of October 31, 2023[9] - Net cash provided by operating activities decreased to $168.8 million from $446.0 million, a decline of about 62.2%[14] - Cash and cash equivalents at the end of the period were $194.2 million, up from $157.7 million, indicating an increase of approximately 23.1%[14] - The company reported a net cash used in investing activities of $703.8 million, compared to $496.7 million in the previous year, representing an increase of about 41.7%[14] - The company experienced a net cash provided by financing activities of $541.7 million, a significant increase from $62.0 million in the prior year[14] Assets and Liabilities - Total assets increased to $6,834.9 million as of July 31, 2024, compared to $5,960.8 million as of October 31, 2023, reflecting a growth of 14.6%[9] - Total liabilities and shareholders' equity increased to $6,834.9 million as of July 31, 2024, compared to $5,960.8 million on October 31, 2023, reflecting a growth of about 14.6%[12] - Long-term debt rose significantly to $2,793.4 million from $2,121.4 million, marking an increase of approximately 31.7%[12] - The current portion of long-term debt increased to $95.8 million from $88.3 million, reflecting a rise of approximately 17.0%[12] - Total shareholders' equity increased to $2,099.6 million from $1,986.3 million, a rise of about 5.7%[12] Acquisitions and Divestitures - The company completed the acquisition of Ipackchem Group SAS on March 26, 2024, for a total purchase price of $582.1 million, with transaction costs of $8.9 million[24] - Goodwill recognized from the Ipackchem acquisition amounted to $275.4 million, attributed to expected synergies and economies of scale[24] - The total purchase price for the ColePak acquisition was $74.6 million, with a fair value of the remaining noncontrolling interest at $72.1 million[33] - The total purchase price for the Centurion acquisition was $144.5 million, with a fair value of the remaining noncontrolling interest at $40.9 million[39] - The total purchase price for the Lee Container acquisition was $303.0 million, net of cash acquired[43] - The Delta Divestiture generated net sales proceeds of $91.2 million and resulted in a gain of $46.1 million, including $26.1 million of allocated goodwill[52] - The Tama Divestiture resulted in net cash proceeds of $100.2 million and a gain of $54.6 million, with $22.5 million of goodwill allocated to the sale[53] Segment Performance - The Global Industrial Packaging segment reported an operating profit of $131.8 million for the three months ended July 31, 2024, up from $102.0 million in the same period last year, representing a 29.4% increase[105] - The Paper Packaging & Services segment generated net sales of $603.6 million for the three months ended July 31, 2024, compared to $563.9 million in the same period last year, an increase of 7.0%[102] - The Global Industrial Packaging segment generated net sales of $846.0 million, up from $761.8 million, marking an 11.1% increase year-over-year[129] - The Paper Packaging & Services segment reported net sales of $603.6 million in Q3 2024 from $563.9 million in Q3 2023, but gross profit fell to $102.5 million from $128.1 million[142] Expenses and Profitability - SG&A expenses rose to $164.0 million in Q3 2024 from $135.7 million in Q3 2023, representing 11.3% of net sales compared to 10.2% in the previous year[136] - Adjusted EBITDA decreased to $193.7 million in Q3 2024 from $226.5 million in Q3 2023, a decline of 14.5%[129] - Gross profit decreased to $290.4 million in Q3 2024 from $307.0 million in Q3 2023, with a gross profit margin of 20.0% compared to 23.1% in the prior year[135] - Operating profit increased to $171.0 million in Q3 2024 from $155.6 million in Q3 2023, while net income was $93.6 million, down from $96.7 million[137] Tax and Compliance - Income tax expense for the nine months ended July 31, 2024, was $15.0 million, a decrease of $92.9 million from $107.9 million in the same period in 2023[84] - The estimated net decrease in unrecognized tax benefits for the next 12 months ranges from zero to $6.3 million[150] - The company was in compliance with all covenants under the 2023 Credit Agreement and the U.S. RFA[185][187] Risk Factors and Future Outlook - The company continues to face risks related to economic conditions, supply chain disruptions, and competitive pressures that may impact future performance[114] - The company anticipates mixed demand trends to continue, with stable costs for key materials and services expected through the fiscal year end[137]