Pactiv Evergreen Reports Second Quarter 2024 Financial Results

Core Insights - Pactiv Evergreen Inc. announced the sale of its Pine Bluff mill and Waynesville extrusion facility to Suzano, marking a significant step in its strategic transformation to focus on core North American operations [2][5][22] - The second quarter of 2024 financial results were impacted by end-market weakness and operational disruptions, leading to a revision of the full-year guidance [2][22] Financial Performance - Net revenues for Q2 2024 were $1,338 million, down 6% from $1,426 million in Q2 2023, but up 7% from $1,252 million in Q1 2024 [1][8] - Net income for Q2 2024 was $20 million, compared to a net loss of $139 million in Q2 2023 and net income of $10 million in Q1 2024 [1][9] - Adjusted EBITDA for Q2 2024 was $183 million, down from $217 million in Q2 2023 and up from $168 million in Q1 2024 [1][10] - Diluted earnings per share for Q2 2024 were $0.10, compared to a loss of $0.78 in Q2 2023 and earnings of $0.04 in Q1 2024 [1][9] Strategic Initiatives - The company is undergoing a Footprint Optimization initiative expected to yield cost savings starting in 2025, with anticipated capital expenditures of $40 million to $45 million [3] - The Beverage Merchandising Restructuring, which includes the sale of the Pine Bluff and Waynesville facilities, is expected to improve long-term cash flow and reduce volatility [2][6] Market Conditions - The company faced lower-than-expected sales volumes due to inflationary pressures affecting consumer demand [2][8] - The closure of the Canton, North Carolina mill in Q2 2023 contributed to the decline in revenues [8][10] Outlook - The full-year Adjusted EBITDA guidance has been revised to a range of $800 million to $820 million due to ongoing market challenges and the pending divestiture of facilities [22][23] Balance Sheet and Cash Flow - The company reduced total outstanding debt by $544 million since December 31, 2022, with net debt declining by $108 million [20] - Cash and cash equivalents as of June 30, 2024, were $95 million, up from $71 million at the end of Q1 2024 [21][38]