SEE Earning Date, Transcript Summary & Report

Strong Q4 Performance: We exceeded our expectations in the fourth quarter, including coming in higher than our guided midpoint across adjusted EBITDA, adjusted EPS and free cash flow, and driving constant currency sales growth.

Food Business Resilience: The strength of our food business more than offset the challenges in protective throughout 2024, with mid-single-digit adjusted EBITDA growth despite a sales decrease of 2%.

Consistent Performance Improvement: We have now consistently delivered against expectations for 6 straight quarters, reflecting improved discipline and fundamentals and better commercial execution.

Food Sales Growth: Food sales of $923 million for the quarter were up 5% on an organic basis primarily due to volume growth in all regions, driven by strength in our shrink bag business and continued share gain in case-ready solutions.

Food EBITDA Growth: Food adjusted EBITDA of $208 million in the fourth quarter was up 7% with a margin of 22.5%, up 70 basis points, reflecting productivity benefits and volume growth.

Strong Free Cash Flow: We consistently generated free cash flow throughout the year, totaling $454 million, which was particularly strong cash flow conversion considering our restructuring and associated payments increased to $58 million from $19 million a year ago.

Capital Allocation Discipline: We maintained our capital allocation discipline through our focus on deleveraging the balance sheet and ended 2024 with a net leverage ratio of 3.6x compared to a peak of 4.1x in the second quarter of 2023.

Total Liquidity Position: Our total liquidity position was $1.4 billion, including $372 million in cash and the remaining amount in a committed and fully undrawn revolver.

Adjusted EBITDA Forecast: We expect full year adjusted EBITDA to be in the range of $1.075 billion to $1.175 billion, representing approximately 1% year-over-year growth at the midpoint, which assumes a margin of approximately 21%.

Cost Savings Impact on EBITDA: The midpoint of our adjusted EBITDA guidance includes $90 million year-over-year cost savings more than offsetting negative net price realization and FX headwinds.

Sales Performance Decline: Net sales for the full year were down 1% at constant currency, indicating a decline in overall sales performance.

EBITDA Decline Analysis: Adjusted EBITDA for the fourth quarter decreased by 1% compared to last year, reflecting challenges in maintaining profitability.

Earnings Per Share Decline: Adjusted EPS in the fourth quarter was down 15% compared to a year ago, highlighting a significant drop in earnings per share.

Protective Segment Sales Decline: The Protective segment saw a 7% decline in net sales in the fourth quarter, indicating ongoing struggles in this area.

Decline in Adjusted EBITDA: Protective adjusted EBITDA was down 26% in the fourth quarter, primarily due to lower volumes and unfavorable net price realization.

Foreign Exchange Impact on Sales: The company faced unfavorable foreign exchange movements, which negatively impacted sales and adjusted EBITDA.

Protective Segment Sales Decline: The outlook for the Protective segment in 2025 projects a full year sales decline of approximately 2%, indicating continued challenges ahead.

Pricing Pressure Impact: Pricing pressures are expected to persist, further reducing top line growth by 1% in 2025.

Share Repurchase Inactivity: The company did not repurchase any shares in the quarter, which may signal a lack of confidence in returning capital to shareholders.

Increased Tax Rate Impact: The adjusted tax rate increased to 28% in the fourth quarter compared to 18% in the same period last year, which negatively impacted earnings.