Westrock fee pany(US:WEST)2025-11-06 22:01Financial Performance - Net sales for the three months ended September 30, 2025, increased to $354.8 million, up 60.5% from $220.9 million in the same period of 2024[13] - Gross profit for the three months ended September 30, 2025, was $41.4 million, compared to $37.1 million in 2024, reflecting a gross margin of 11.7%[13] - The company reported a net loss of $19.1 million for the three months ended September 30, 2025, compared to a net loss of $14.3 million in the same period of 2024[14] - Net loss for the nine months ended September 30, 2025, was $67.884 million, compared to a net loss of $55.691 million for the same period in 2024, representing an increase in losses of approximately 21.5%[18] - For the three months ended September 30, 2025, the company recognized $354.8 million in net sales, a 60.5% increase from $220.9 million in the same period of 2024[69] - Revenue from coffee and tea for the three months ended September 30, 2025, was $186.4 million, up 61.5% from $115.5 million in 2024[69] - For the nine months ended September 30, 2025, net sales totaled $849.480 million, compared to $621.749 million for the same period in 2024, marking an increase of about 36.5%[157][158] Assets and Liabilities - Total current assets increased to $393.6 million as of September 30, 2025, from $333.6 million at December 31, 2024, representing an increase of 17.9%[12] - Total liabilities rose to $893.0 million as of September 30, 2025, compared to $730.4 million at December 31, 2024, indicating an increase of 22.2%[12] - The company’s total assets reached $1.18 billion as of September 30, 2025, compared to $1.10 billion at December 31, 2024[12] - The company’s total shareholders' equity decreased to $11.4 million as of September 30, 2025, from $97.5 million at December 31, 2024[12] - Total debt increased to $538.13 million as of September 30, 2025, up from $447.73 million on December 31, 2024, marking a 20.2% increase[82] Cash Flow and Expenses - Cash and cash equivalents at the end of the period on September 30, 2025, were $33.971 million, up from $22.359 million at the end of September 30, 2024, indicating a year-over-year increase of approximately 52.5%[18] - Cash flows from operating activities resulted in a net cash used of $55.703 million for the nine months ended September 30, 2025, compared to $16.023 million for the same period in 2024, indicating a significant increase in cash outflow[18] - Selling, general and administrative expenses were $47.0 million for the three months ended September 30, 2025, slightly up from $46.1 million in 2024[13] - Interest expense for the three months ended September 30, 2025, was $14.0 million, significantly higher than $6.9 million in the same period of 2024[13] - The company incurred interest expenses of $39.741 million for the nine months ended September 30, 2025, compared to $21.921 million for the same period in 2024, representing an increase of approximately 81%[157][158] Equity and Investments - The company recognized a $2.3 million gain from the de-consolidation of Rwanda Trading Company during the three months ended June 30, 2025[23] - The company holds a 49.9% equity method investment in a joint venture with a balance of $7.5 million as of September 30, 2025[44] - The company had an equity investment with a carrying value of approximately $1.0 million as of September 30, 2025, with no adjustments made to its carrying value[139] Legal Matters - The company is currently involved in legal proceedings with Dairy Farmers of America, Inc., alleging trade secret misappropriation, which may impact its financial position[167][168] - The company intends to vigorously defend against the legal claims and has not yet determined the potential financial impact of the lawsuit[168][169] Future Obligations and Financing - Future purchase obligations amount to $218.5 million as of September 30, 2025, primarily for inventory purchases over the next 12 months[170] - The company issued $30.0 million in 5.00% convertible senior notes due 2031 on November 4, 2025, with an initial conversion price of $5.25[176][177] - The company modified its Credit Agreement on November 4, 2025, extending the Covenant Relief Period until October 1, 2026[180] Segment Performance - Segment Adjusted EBITDA for the Beverage Solutions segment was $20.422 million for Q3 2025, up from $11.752 million in Q3 2024, indicating a year-over-year increase of about 74%[159][161] - Employee-related costs for the Beverage Solutions segment were $42.326 million for the nine months ended September 30, 2025, up from $35.017 million in the same period of 2024, reflecting an increase of about 20%[163][165] Inventory and Cost of Sales - Total inventories increased to $212.97 million as of September 30, 2025, up from $163.32 million on December 31, 2024, representing a 30.3% increase[70] - The company reported total costs of sales of $509.311 million for the nine months ended September 30, 2025, compared to $369.282 million for the same period in 2024, indicating an increase of approximately 38%[163][165]