Financial Data and Key Metrics Changes - Graphic Packaging's sales for Q3 2025 were $2.2 billion, with adjusted EBITDA of $383 million and an adjusted EBITDA margin of 17.5%. Adjusted EPS was $0.58 [4][10][22] - Year-on-year volumes were down 2%, but the company outperformed most markets served [10][14] Business Line Data and Key Metrics Changes - The innovation platform has opened new markets for paperboard packaging, contributing an additional $52 million in the quarter, roughly 2% of total sales [31] - Food and household products remained steady, while beverage and food service sectors showed weakness [12][18] - Health and beauty, primarily a European business, continued to perform solidly [12] Market Data and Key Metrics Changes - The consumer market has bifurcated, with upper-income consumers spending differently and lower-income consumers cutting back due to rising food prices [10] - Grocery volumes have been impacted, with CPG customers timing purchases to manage cash, leading to less predictable order flows [10][12] Company Strategy and Development Direction - The Waco facility is a critical investment that enhances supply chain efficiency and reduces waste, expected to ramp up to full production in 12-18 months [8][9] - The company is transitioning from Vision 2025 to Vision 2030, focusing on free cash flow generation [8][22] - Graphic Packaging aims to leverage its competitive advantages in innovation, cost efficiency, and quality to drive long-term growth [22][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging consumer packaging environment but expressed confidence in improving margins as demand normalizes [23][25] - The company is focused on controlling costs and inventory, with plans to further reduce SG&A expenses [24][25] - Management expects a significant free cash flow inflection in 2026, targeting $700-$800 million [26][28] Other Important Information - The company repurchased approximately 6.8 million shares year-to-date, reducing shares outstanding by 2.3% in 2025 [23] - The Waco facility's startup costs are estimated at $65-$75 million, with two-thirds incurred in 2025 and one-third in 2026 [46][54] Q&A Session Summary Question: Did the end markets track as expected, and what about share shifts due to bleached board conversion? - Management clarified that there was no share loss; customer purchasing patterns affected volumetric performance, with innovation helping to outperform challenges [31] Question: Confidence in Waco's EBITDA contribution for next year? - Management expressed high confidence in Waco delivering the expected $80 million EBITDA contribution [32] Question: Opportunities for further productivity improvements? - Management highlighted the focus on cost control and efficiency, with a return to normalized CapEx expected to generate significant free cash flow [35] Question: Trends in the food service market? - Management noted that fast casual dining is under pressure, while quick service restaurants are gaining traction, with innovation expected to support volume growth [39] Question: Impact of competitive price pressure on SBS and CUK? - Management confirmed no share loss and emphasized the cost advantages of coated recycled paperboard over bleached alternatives [41] Question: Update on Pacesetter Rene Premium CRB and pricing? - Management indicated that while Rene is a competitive product, pricing may be impacted by market dynamics, but they have the capabilities to manage this [49] Question: Expectations for year-end leverage? - Management projected a net debt range of 3.5-3.7 times by year-end, influenced by reduced EBITDA and share repurchases [50]