Greif Inc Announces Third Quarter 2024 Financial Results
Intellectia.AI Updated: 2024-08-28
Greif, Inc. Announces Third Quarter 2024 Financial Results
DELAWARE, Ohio, Aug. 28, 2024—Greif, Inc. (NYSE:GEF, GEF.B), a global leader in industrial packaging products and services, today reported its financial results for the fiscal third quarter of 2024.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | YoY Change | Consensus Estimate |
|---|---|---|---|---|
| Total Revenue | $1.45B | $1.36B | +6.6% | $1.42B |
| Net Income | $87.1M | $90.3M | -3.5% | N/A |
| Earnings Per Share (EPS) | $1.50 | $1.55 | -3.2% | $1.14 |
| Adjusted Net Income | $59.6M | $102.1M | -41.6% | N/A |
| Adjusted EPS | $1.03 | $1.75 | -41.1% | N/A |
| Adjusted EBITDA | $193.7M | $226.5M | -14.5% | N/A |
| Net Cash from Operations | $76.8M | $202.3M | -62.0% | N/A |
| Adjusted Free Cash Flow | $34.3M | $167.1M | -79.5% | N/A |
Greif's financial results were mixed but largely positive due to a significant revenue increase of 6.6% year-over-year, surpassing the consensus estimate of $1.42 billion. However, net income and adjusted net income experienced declines of 3.5% and 41.6% respectively, attributed to various adjustments and increases in operating expenses. Adjusted EBITDA also showed a 14.5% decrease year-over-year.
Segment Financial Performance
| Segment | Revenue (Q3 2024) | Revenue (Q3 2023) | YoY Change |
|---|---|---|---|
| Global Industrial Packaging | $846.0M | $761.8M | +11.0% |
| Paper Packaging & Services | $603.6M | $563.9M | +7.1% |
Interpretation of Segment Performance:
- Global Industrial Packaging: Revenue increased by $84.2 million (11.0%) driven by higher average selling prices, increased volumes, and contributions from recent acquisitions. Gross profit increased by $8.8 million to $185.6 million, but Adjusted EBITDA showed a slight decrease of $4.2 million due to higher SG&A expenses related to strategic investments.
- Paper Packaging & Services: Revenue increased by $39.7 million (7.1%), supported by higher average selling prices and volumes. However, gross profit decreased by $25.6 million due to higher raw material, transportation, and manufacturing costs. Adjusted EBITDA also decreased by $28.7 million impacted by similar factors.
Key Developments and Operational Highlights
- Delta Petroleum Company Divestment: Completed divestment and received cash proceeds on August 1, 2024, enabling accelerated debt paydown.
- Ipackchem Group Acquisition: Integration progressing ahead of schedule with expected run-rate synergy capture of at least $7 million in the following twelve months.
- Upcoming Investor Day: Scheduled for December 11, 2024; further details to be sent in September.
Comments from the CEO
"We are proud to present another solid quarter of performance for Greif," stated Ole Rosgaard, President and CEO. "Despite global market uncertainties, our customer engagement strategy has yielded positive volume momentum. Internally, we're concluding significant organizational realignments and are eager to discuss their benefits at our upcoming Investor Day."
Dividend Announcement
The Board of Directors declared quarterly cash dividends of $0.54 per share for Class A Common Stock and $0.81 per share for Class B Common Stock, reflecting increases of $0.02 and $0.03 per share, respectively, from the prior quarter. Dividends are payable on October 1, 2024, to shareholders of record as of September 16, 2024.
Forward Guidance
The company has not provided specific net income guidance for fiscal 2024 due to variables that are difficult to forecast, such as potential gains or losses from asset disposals and restructuring charges.
Stock Price Movement
Following the earnings release, Greif’s stock experienced a minor uptick of 0.83%.
Overall, Greif, Inc. demonstrated robust revenue growth and continued strategic focus but faced challenges in maintaining net income and adjusted EBITDA amid rising operational costs. The completion of significant divestments and acquisitions positions the company well for future growth.
For more details, participants can join the company’s conference call scheduled for August 29, 2024, at 8:30 a.m. Eastern Time using the provided registration link.
Contact Information: Bill D'Onofrio, Vice President, Corporate Development & Investor Relations, at Bill.Donofrio@greif.com or 614-499-7233.
For further information, visit Greif's Investor Relations Website .
