Graphic Packaging(GPK)2025-02-12 21:58Environmental Compliance and Sustainability - In 2024, the Company spent $65 million on capital projects to maintain compliance with environmental laws, with estimated expenditures of $53 million and $91 million for 2025 and 2026 respectively[56]. - The Company aims to achieve 90% renewable fuel use in wood fiber paperboard manufacturing facilities and raise purchased renewable electricity to 50% by 2030[59]. - The Company estimates significant compliance costs due to complex environmental laws and regulations, which may become more stringent over time[58]. - The Company is positioned to benefit from increased consumer demand for lower-carbon products and technologies, driven by climate change legislation[58]. Financial Performance and Valuation - As of October 1, 2024, the Company performed a quantitative impairment test and found that all reporting units with goodwill had a fair value exceeding their carrying value, with the Europe reporting unit exceeding by 24%[184]. - The Company has a valuation allowance of $45 million against net deferred tax assets as of December 31, 2024, up from $37 million in the previous year[187]. - The discount rate used for goodwill impairment testing ranged from 7% to 8%, with a transaction multiple of 9.0 times for terminal period cash flows[184]. Tax and Currency Management - The Company has not provided for deferred U.S. income taxes on outside basis differences of approximately $80 million in its international subsidiaries due to the intention to indefinitely reinvest earnings[189]. - The Company has provided deferred income taxes for future withholding tax expenses related to its equity investment in a joint venture, asserting permanent reinvestment of earnings in its Canadian subsidiary[188]. - The Company utilizes a currency hedging program and has entered into natural gas swap contracts to manage future energy cost increases, with realized gains and losses included in financial results[176].