USA – Industrial packaging company Greif reported a 3.5% decline in net income for the third quarter (Q3) of fiscal year 2024 (FY24), with net income falling to US$87.1 million from US$90.3 million in Q3 FY23.
Earnings per diluted Class A share also decreased slightly, dropping from US$1.55 in Q3 FY23 to US$1.50 in Q3 FY24.
Despite the dip in net income, Greif experienced an increase in net sales, which rose to US$1.45 billion for the quarter ending July 31, 2024, up from US$1.33 billion in Q3 FY23.
However, gross profit for the quarter decreased to US$290.4 million, down from US$307.0 million in the same period last year.
On a positive note, the company’s operating profit improved, reaching US$171.0 million compared to US$155.6 million in Q3 FY23.
Greif’s global Industrial Packaging segment saw a notable rise in net sales, increasing by US$84.2 million to US$846.0 million, driven by higher average selling prices, increased volumes, and contributions from recent acquisitions.
The segment’s gross profit also increased, jumping from US$8.8 million to US$185.6 million. In contrast, the Paper Packaging and Services segment reported a rise in net sales by US$39.7 million to US$603.6 million, but its gross profit decreased by US$25.6 million to US$102.5 million.
At the end of the quarter, Greif’s total debt stood at US$2.90 billion, with net debt increasing by US$701.5 million to US$2.71 billion.
Greif President and CEO Ole Rosgaard commented on the results, “We are proud to present another solid quarter of performance for Greif. While global markets remain uncertain, our diligence in maintaining close contact with our customers has resulted in positive volume momentum in all regions.
“We are also making strides internally and nearing completion of the previously announced internal re-alignment of operating and commercial functions. We plan to discuss the benefits of that transition in greater detail at our upcoming Investor Day on December 11.”
Mayr-Melnhof’s 1H 2024 sales down 6.3%
In the second quarter (Q2) of 2024, the Mayr-Melnhof Group (MM Group) showed improvement compared to the previous quarter and exceeded the prior year’s figures.
Consolidated sales reached €1.02 billion (US$1.13bn), slightly below Q1 2024’s €1.025 billion (US$1.14bn) and the previous year’s Q2 2023 figure of €1.059 billion (US$1.17bn).
The Group’s adjusted operating profit increased to €51.0 million (US$56.50m), surpassing both the previous quarter and the same period last year.
The adjusted operating margin stood at 5.0%, while adjusted EBITDA reached €107.2 million (US$118.75m). Profit for the period amounted to €26.5 million (US$29.36m), down slightly from €28.4 million (US$31.46m) in Q2 2023.
For the first half (1H) of 2024, the Group’s consolidated sales totaled €2. 044 billion (US$2.26bn), down from €2.181 billion (US$2.42bn) in 1H 2023, primarily due to lower selling prices.
Adjusted operating profit decreased by €36.4 million (US$40.32m), from €127.0 million (US$140.69m) to €90.6 million (US$100.37m), largely because of lower average prices in the Board & Paper division. The Group’s adjusted operating margin was 4.4%.
Financial income increased to €13.3 million (US$14.73m), up from €3.7 million (US$4.10m) in 1H 2023, while financial expenses rose from €24.7 million (US$27.36m) to €42.7 million (US$47.30m), largely due to higher interest rates on variable-interest financing.
Profit before tax totalled €51.2 million (US$56.72m), down from €77.2 million (US$85.52m) the previous year.
An income tax expense of €13.8 million (US$15.29m) resulted in an effective Group tax rate of 27.1%. Consequently, profit decreased from €63.3 million (US$70.12m) to €37.4 million (US$41.43m).
MM Group CEO Peter Oswald commented, “The MM Group succeeded in improving its adjusted EBITDA and adjusted operating profit in Q2 2024 compared to both the previous two quarters and last year’s Q2.
“The consistent execution of the profit & cash protection program led to a significant increase in cash flow from operating activities and free cash flow. At the same time, the Group’s financial leverage remained largely constant.”
MM Group remains focused on enhancing earnings and cash generation by continuing its profit and cash protection program, with most savings expected to materialize in 2025.
Capital expenditures will remain significantly lower than in previous years, as major projects have already been completed.
The Group’s strategy and capital allocation will continue to focus on expanding in growing, innovative, and sustainable market segments, prioritizing improving margins before pursuing further non-organic growth.
MM is a global leader in consumer packaging, offering solutions for cartonboard, folding cartons, kraft papers, uncoated fine papers, leaflets, and labels.
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