Group 1 - U.S. equities showed mixed performance, with the S&P 500 and Nasdaq declining from record highs while the Dow Jones Industrial Average increased [1][5] - Tesla (TSLA) shares fell due to a renewed conflict between CEO Elon Musk and President Trump, who suggested an investigation into Tesla's subsidies [1][5] - Sweetgreen (SG) shares dropped following a downgrade and price target cut by TD Cowen, citing weakness in urban locations [2] - AeroVironment (AVAV) shares decreased after announcing a $1.35 billion stock and convertible notes offering to finance its $4.1 billion acquisition of BlueHalo [2] Group 2 - Shares of Wynn Resorts (WYNN), Las Vegas Sands (LVS), and MGM Resorts International (MGM) surged after Macau casinos reported June gambling revenues exceeding expectations [3][5] - Packaging Corporation of America (PKG) shares rose after acquiring Greif's containerboard business for $1.8 billion [3] - Hasbro (HAS) shares increased following an upgrade from Goldman Sachs, which highlighted potential benefits from the "Magic: The Gathering" card game [3] Group 3 - Oil and gold futures experienced an increase, while the yield on the 10-year Treasury note advanced [4] - The U.S. dollar strengthened against the euro and pound but weakened against the yen [4] - Most major cryptocurrencies traded lower [4]

Financial Data and Key Metrics Changes - Consolidated net revenue increased by 8.8% on a constant currency basis for the quarter, driven by 12% volume growth, particularly in North America [7][15] - Adjusted EBITDA declined by 7.8% for the quarter, including a non-cash impact of the Amazon warrants, which contributed a 4.2% headwind to reported figures [10][18] - Overall profitability was negatively impacted by increased input costs and lower sales volume in Europe and Asia Pacific [11][12] Business Line Data and Key Metrics Changes - North America saw sales up by 33% and volumes up more than 40% compared to Q1 2024, driven by strong growth in enterprise accounts [7][15] - Europe and Asia Pacific combined revenue decreased by 6% on a constant currency basis, primarily due to lower PTS volumes in March [15] - Automation sales in EMEA were in line with expectations, with a forecast for meaningful growth in 2025 [15] Market Data and Key Metrics Changes - North America exhibited robust growth, while Europe experienced a deterioration in activity, particularly in March [9][33] - April showed stabilization in Europe, with volumes up compared to the prior year, but overall activity was still weaker than at the start of the year [10][34] - Japan was highlighted as a strong market within Asia Pacific, while Southeast Asia and Australia showed mixed performance [35][36] Company Strategy and Development Direction - The company is focused on driving volumes, winning market share, reducing structural costs, and maximizing cash flow [13][29] - There is an emphasis on deepening relationships with major e-commerce and retail players to support growth in North America [8] - The company is taking steps to mitigate tariff impacts by evaluating alternative suppliers and refurbishing existing machines [25][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to weather disruptions from global trade discussions due to its diverse geographic presence [6][29] - There is cautious optimism regarding potential growth in Europe, influenced by legislative changes and stimulus measures [34] - The company remains confident in achieving a 50% growth rate in automation despite potential delays due to macroeconomic factors [42][44] Other Important Information - The company invested over $10 million in additional paper inventory to mitigate lead time disruptions [19] - The impact of the Amazon warrants will continue to create non-cash decreases in reported revenue figures [22][23] - The company is implementing structural cost reductions of $8 million to improve its financial profile [18] Q&A Session Summary Question: Insights on EMEA and APAC performance in March and April - Management noted that Southern Europe performed better than Northern Europe, with some stabilization observed in April [33][34] Question: Expectations for automation project timelines - Management indicated that while some projects may slip between quarters, they remain confident in achieving significant growth in automation [40][42] Question: Outlook on gross margin improvements - Management expects gross margin to improve from Q1 to Q2, with further improvements anticipated in Q3 and Q4 as cost initiatives take effect [47][48] Question: Details on cost reduction actions - Management highlighted operational efficiencies, better planning, and structural cost reductions as key areas for improving margins [50][54]

Financial Performance - Net revenue increased by 6.9% on an actual basis and 8.8% on a constant currency basis, driven by higher volumes[14] - Adjusted EBITDA decreased by 9.9% on an actual basis and 7.8% on a constant currency basis, including a 420 bps headwind from Amazon warrant reduction in revenue ($0.8 million)[14] - Gross margin decreased by 4.0% year over year to 33.9%, impacted by increased contribution from North American void-fill and lower volumes in EMEA/APAC, as well as a 90 bp impact from non-cash Amazon warrant revenue reduction[14] - Net loss was $(10.9) million, compared to $(8.1) million in the prior year[28] Regional Performance - North America revenue increased by 33.5% versus prior year due to higher PPS sales driven by e-commerce activity among large enterprise accounts as well as in the distribution channel[14] - EMEA/APAC revenue decreased by 6.0% on a constant currency basis (9.0% on an actual basis) driven by a 1 pt decline in volume, 3 pts of price/mix (lower cushioning), and 2 pts Automation[14] Liquidity and Capitalization - The company finished 1Q25 with $65.5 million cash on hand[14] - Net Leverage Ratio was 4.3x as of March 31, 2025[27] Operational Factors - Volume growth was strong at 12.0%, but partially offset by price/mix (-2.4%) and a decrease from Amazon warrants (-0.9%)[14] - Actions have been taken in Q2 to improve price, defer discretionary spend, and reduce structural costs to improve margin profile and focus on cash generation[14]

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q1 2025 was $145 million, an improvement of $7 million compared to the prior year quarter [28] - Adjusted EPS for the quarter was $0.39, lower than the prior year primarily due to a non-recurrence of a one-time tax benefit of $48 million and $14 million of higher interest expense [28] - Adjusted free cash flow was a net use of $62 million, slightly higher than the prior year due to increased interest expense [29] Business Line Data and Key Metrics Changes - Polymers segment saw a 2.7% increase driven by demand in small containers and IBC in the ag and food sectors, particularly in EMEA [20] - Integrated Solutions experienced low double-digit growth in both caps and closures and paints, linings, and adhesives [20] - Fiber volumes were slightly up, with operating rates in both paper grades in line with the industry [21] - Metals segment continued to be impacted by a soft industrial economy, particularly in bulk chemicals and petrochemicals [21] Market Data and Key Metrics Changes - EMEA demonstrated the highest level of resilience, followed by APAC, while LATAM showed a slight downward trend and North America had the most bearish demand sentiment [24] - Demand trends in boxboard were flat year-on-year, with specific subsegments like URB showing softness [84] Company Strategy and Development Direction - Company announced a $100 million cost optimization initiative and a commitment to achieve $1 billion EBITDA and $500 million free cash flow by 2027 [7][10] - The decision to sell the timber portfolio of approximately 176 acres was made to reduce debt and refocus on core growth areas [17] - The company is focusing on growing in GDP-plus growth markets such as agrochemicals, food and beverage, and pharmaceuticals [99] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about future volume growth, noting that while some markets showed sequential improvements, no clear inflection point had been observed [54] - The company remains committed to operational excellence and customer-centric growth, aiming to create continuing value for stakeholders [106] Other Important Information - The organizational realignment in 2024 resulted in new strategic business units (SBUs) to better visualize portfolio fit and growth objectives [16] - The company is experiencing short-term SG&A cost inflation as it reallocates resources for long-term value creation [31] Q&A Session Summary Question: Fiber segment performance relative to expectations - Management indicated that fiber performance was in line with expectations, but SG&A allocation protocols may have caused confusion regarding profitability [45][46] Question: Differences in demand between EMEA and North America - Management explained that the difference is due to end market exposure, with growth in agrochemical markets contributing to EMEA's resilience [50][51] Question: Margin expectations for Q2 and beyond - Management expects EBITDA margins to steadily improve through the year, driven by volume lift and fixed cost leverage [63] Question: Timberland sale details - Management stated that the timberland sale is aimed at reducing debt and that the value of timberland has been increasing due to various factors [66][72] Question: Demand trends in boxboard - Management noted that total boxboard demand is flat year-on-year, with specific subsegments showing varying performance [84] Question: Competitive landscape in polymers and metals - Management emphasized a focus on value over volume, maintaining confidence in market position despite competitive pressures [90][95] Question: Exciting end markets and concerns - Management highlighted agrochemicals and food and beverage as exciting markets, while expressing caution regarding the pharma space due to long lead times [99][100]