REG-Smurfit Westrock plc Smurfit Westrock Reports Second Quarter 2024 Financial Results
31/07/2024 07:00
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Smurfit Westrock Reports Second Quarter 2024 Financial Results
Smurfit Westrock plc (NYSE: SW, LSE: SWR) today announced the financial
results for the second quarter ended June 30, 2024 of Smurfit Kappa Group plc.
Due to the timing of the completion of the combination of Smurfit Kappa Group
plc and WestRock Company, results for the combined company of Smurfit Westrock
will be reported from the third quarter 2024.
Key points:
* Net Sales of approx. $3.0 billion
* Net Income of $132 million
* Adjusted EBITDA(1) of $480 million, with an Adjusted EBITDA Margin(1) of 16.2%
* Higher recovered fiber costs in the process of being recovered
* Previously announced quarterly dividend of $0.3025 per ordinary share
* Smurfit Westrock listed on the NYSE and included in S&P 500
* Smurfit Westrock credit rating of BBB/BBB/Baa2 from S&P, Fitch and
Moody’s respectively
Smurfit Kappa Group plc’s performance for the three months ended June 30,
2024 and 2023 (in millions):
June 30, 2024 June 30, 2023
Net Sales $ 2,969 $ 3,076
Net Income $ 132 $ 267
Adjusted EBITDA(1) $ 480 $ 556
Adjusted EBITDA Margin(1) 16.2% 18.1%
Net Cash provided by Operating Activities $ 340 $ 307
Adjusted Free Cash Flow(1) $ 186 $ 83
June 30, 2024 December 31, 2023
Net Leverage Ratio(1) 1.6x 1.3x
Tony Smurfit, President and CEO, commented:
"I am pleased to report a strong set of results, and continued delivery of
quality and service for our customers. This has been driven by our
performance‑led culture, together with the continuing benefits of our prior
year capital allocation decisions. These results were also achieved against a
backdrop of significantly higher recovered fiber costs and lower corrugated
box prices. We expect these increased costs will be recovered through
increased box pricing with the customary time lag.
"Smurfit Kappa’s corrugated volume growth was 3.1% in the second quarter
with 3.5% growth in Europe and 1.5% in the Americas year-on-year. On a
shipments per day basis, volume growth was 1.1% for the Group, with growth of
1.4% and 0.1% in Europe and the Americas respectively. Demand in Southern and
Eastern Europe remained robust while German demand remained soft. In the
Americas, demand was generally good, with the exception of Argentina.
"After the quarter end, on July 5, we completed our transaction with WestRock.
On July 8, Smurfit Westrock listed on the NYSE and was included in the S&P
500. While we don’t underestimate the amount of hard work ahead of us, there
is tremendous energy and enthusiasm to ensure a successful future for Smurfit
Westrock. I believe that with the quality of our people and the strength of
our market positions, we are creating something truly unique. Smurfit Westrock
will be the ‘Go-To’ sustainable packaging company with the right product,
in the right space at the right time."
__________________
(1) Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow and Net
Leverage Ratio are non-GAAP measures. See the “Non-GAAP Financial Measures
and Reconciliations” below for the discussion and reconciliation of these
measures to the most comparable GAAP measures.
Second Quarter 2024 | Financial Performance
Smurfit Kappa’s net sales decreased by $107 million, or 3%, to $2,969
million in the second quarter of 2024 from $3,076 million in the second
quarter of 2023. This decrease was primarily driven by lower average box
pricing in our European business year-on-year. The decrease was partially
offset by an increase in Group corrugated volumes of 3.1% (1.1% on a shipments
per day basis), a $28 million net positive foreign currency impact and a $4
million positive impact from acquisitions.
Net income decreased by $135 million, to $132 million in the second quarter,
from $267 million in the same period of last year. This decrease was primarily
due to a decrease in net sales and additional transaction-related expenses of
$60 million associated with the Smurfit Westrock combination, which were
partially offset by a $12 million decrease in costs of goods sold driven by
lower raw material and energy costs year-on-year.
Adjusted EBITDA for the Group was $480 million, with an adjusted EBITDA margin
of 16.2% in the second quarter of 2024, compared to adjusted EBITDA of $556
million, with an adjusted EBITDA margin of 18.1% in the second quarter of
2023.
Adjusted EBITDA for Europe decreased by $77 million to $355 million in the
second quarter, from $432 million in the same period of 2023. This decrease
was primarily due to a $143 million decrease in net sales and an increase in
labor, distribution and recovered fiber costs, partially offset by a decrease
in energy and other raw material costs. The adjusted EBITDA margin in Europe
was 16.1% in the second quarter, compared to 18.4% at the same time last year.
Adjusted EBITDA for our Americas segment increased by $6 million, or 4%, to
$146 million in the second quarter of 2024, from $140 million for the second
quarter of 2023. This increase was primarily due to a $36 million increase in
net sales, partially offset by higher raw materials and labor costs. The
adjusted EBITDA margin in the Americas segment was 19.2% in the second quarter
of 2024, compared to 19.3% in the second quarter of 2023.
The Group’s interest expense, net decreased by $4 million, to $33 million in
the second quarter, from $37 million in the second quarter of last year
primarily due to a reduction in net cash interest costs. Other income, net
increased to $5 million from an other expense, net of $8 million in the prior
year mostly due to a move of $10 million in foreign currency fluctuations on
monetary assets and liabilities.
Income tax expense decreased by $17 million, to $55 million in the second
quarter of 2024, from $72 million in the prior year period, primarily due to
lower earnings and changes in deferred tax related to unremitted foreign
earnings and losses.
Net cash provided by operating activities increased by $33 million, or 11%, to
$340 million in the second quarter of 2024, from $307 million in the second
quarter of 2023. The increase was primarily due to a reduction in tax payments
of $58 million, a change from a net cash interest paid position of $31 million
to a net cash interest received position of $16 million in the second quarter
of this year, resulting in an inflow of $47 million, and a positive working
capital change of $26 million, partially offset by a reduction in consolidated
net income adjusted for non-cash items.
Including capital expenditure of $177 million in the second quarter of 2024,
and $224 million in the same period last year, free cash flow was $163 million
in the second quarter of 2024 and $83 million in the second quarter of 2023.
Excluding transaction costs paid associated with the Smurfit Westrock
combination of $23 million in the second quarter of 2024, adjusted free cash
flow for the period was $186 million. Adjusted free cash flow in the second
quarter of 2023 was $83 million.
Total borrowings amounted to $6,432 million at June 30, 2024, compared to
$3,747 million at December 31, 2023. Net debt was $3,107 million at the end of
June 2024, resulting in a net leverage ratio of 1.6x compared to 1.3x at the
end of December 2023.
Earnings Call
Management will host an earnings conference call today at 5:00 PM ET / 10:00
PM BST to discuss Smurfit Kappa Group’s financial results. The conference
call will be accessible through a live webcast. Interested investors and other
individuals can access the webcast, earnings release, and earnings
presentation via the Company’s website at www.smurfitwestrock.com
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.smurfitwestrock.com&esheet=54101740&newsitemid=20240730991146&lan=en-US&anchor=www.smurfitwestrock.com&index=1&md5=d858e800f04a351565f8263c3ed2018e)
. The webcast will be available at
https://investors.smurfitwestrock.com/overview
(https://cts.businesswire.com/ct/CT?id=smartlink&url=https%3A%2F%2Finvestors.smurfitwestrock.com%2Foverview&esheet=54101740&newsitemid=20240730991146&lan=en-US&anchor=https%3A%2F%2Finvestors.smurfitwestrock.com%2Foverview&index=2&md5=bc8050e12c935e80f03faf70f89ad633)
and a replay of the webcast will be available on the website shortly after the
call.
Forward Looking Statements
This press release includes certain “forward-looking statements”
(including within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended)
regarding, among other things, the plans, strategies, outcomes, and prospects,
both business and financial, of Smurfit Westrock plc (the “Company”), the
expected benefits of the completed combination of Smurfit Kappa Group plc and
WestRock Company to form the combined company of Smurfit Westrock (the
“Combination”) (including, but not limited to, synergies), and any other
statements regarding the Company’s future expectations, beliefs, plans,
objectives, results of operations, financial condition and cash flows, or
future events or performance. Statements that are not historical facts,
including statements about the beliefs and expectations of the management of
the Company, are forward-looking statements. Words such as “may”,
“will”, “could”, “should”, “would”, “anticipate”,
“intend”, “estimate”, “project”, “plan”, “believe”,
“expect”, “target”, “prospects”, “potential”, “commit”,
“forecasts”, “aims”, “considered”, “likely”, “estimate”
and variations of these words and similar future or conditional expressions
are intended to identify forward-looking statements but are not the exclusive
means of identifying such statements. While the Company believes these
expectations, assumptions, estimates and projections are reasonable, such
forward-looking statements are only predictions and involve known and unknown
risks and uncertainties, many of which are beyond the control of the Company.
By their nature, forward-looking statements involve risk and uncertainty
because they relate to events and depend upon future circumstances that may or
may not occur. Actual results may differ materially from the current
expectations of the Company depending upon a number of factors affecting its
business, including risks associated with the integration and performance of
the Company following the Combination. Important factors that could cause
actual results to differ materially from such plans, estimates or expectations
include: developments related to pricing cycles and volumes; economic,
competitive and market conditions generally, including macroeconomic
uncertainty, customer inventory rebalancing, the impact of inflation and
increases in energy, raw materials, shipping, labor and capital equipment
costs; reduced supply of raw materials, energy and transportation, including
from supply chain disruptions and labor shortages; intense competition; risks
related to international sales and operations; the Company’s ability to
respond to changing customer preferences and to protect intellectual property;
results and impacts of acquisitions by the Company; the amount and timing of
the Company’s capital expenditures; evolving legal, regulatory and tax
regimes; changes in economic, financial, political and regulatory conditions
in Ireland, the United Kingdom, the United States and elsewhere, and other
factors that contribute to uncertainty and volatility, natural and man-made
disasters, civil unrest, pandemics (such as the COVID-19 pandemic),
geopolitical uncertainty, and conditions that may result from legislative,
regulatory, trade and policy changes associated with the current or subsequent
Irish, US or UK administrations; the ability of the Company to successfully
recover from a disaster or other business continuity problem due to a
hurricane, flood, earthquake, terrorist attack, war, pandemic, security
breach, cyber-attack, power loss, telecommunications failure or other natural
or man-made event, including the ability to function remotely during long-term
disruptions such as the COVID-19 pandemic; the impact of public health crises,
such as pandemics (including the COVID-19 pandemic) and epidemics and any
related company or governmental policies and actions to protect the health and
safety of individuals or governmental policies or actions to maintain the
functioning of national or global economies and markets; the potential
impairment of assets and goodwill; the scope, costs, timing and impact of any
restructuring of operations and corporate and tax structure; actions by third
parties, including government agencies; the Company’s ability to achieve the
synergies and value creation contemplated by the Combination; the availability
of sufficient cash to distribute dividends to the Company’s shareholders in
line with current expectations; the Company’s ability to promptly and
effectively integrate Smurfit Kappa’s and WestRock’s businesses; the
Company’s ability to successfully implement strategic transformation
initiatives; the Company’s significant levels of indebtedness; the impact of
the Combination on the Company’s credit ratings; legal proceedings
instituted against the Company; the Company’s ability to retain or hire key
personnel; the Company’s ability to meet expectations regarding the
accounting and tax treatments of the Combination, including the risk that the
Internal Revenue Service may assert that the Company should be treated as a US
corporation or be subject to certain unfavorable US federal income tax rules
under Section 7874 of the Internal Revenue Code of 1986, as amended, as a
result of the Combination; other factors such as future market conditions,
currency fluctuations, the behavior of other market participants, the actions
of regulators and other factors such as changes in the political, social and
regulatory framework in which the Company’s group operates or in economic or
technological trends or conditions; and other risk factors included in the
Company’s filings with the Securities and Exchange Commission. Neither the
Company nor any of its associates or directors, officers or advisers provides
any representation, assurance or guarantee that the occurrence of the events
expressed or implied in any such forward-looking statements will actually
occur. You are cautioned not to place undue reliance on these forward-looking
statements. Other than in accordance with its legal or regulatory obligations
(including under the UK Listing Rules, the Disclosure Guidance and
Transparency Rules, the UK Market Abuse Regulation and other applicable
regulations), the Company is under no obligation, and the Company expressly
disclaims any intention or obligation, to update or revise publicly any
forward-looking statements, whether as a result of new information, future
events or otherwise.
About Smurfit Westrock
Smurfit Westrock is a leading provider of paper-based packaging solutions in
the world, with approximately 100,000 employees across 40 countries.
Condensed Consolidated Statements of Operations
in $ millions, except share and per share data
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2024
2023
2024
2023
Net sales $ 2,969 $ 3,076 $ 5,899 $ 6,316
Cost of goods sold (2,276) (2,288) (4,496) (4,705)
Gross profit 693 788 1,403 1,611
Selling, general and administrative expenses (389) (394) (769) (773)
Transaction-related expenses associated with the Combination (60) - (83) -
Operating profit 244 394 551 838
Pension and other postretirement non-service expense, net (29) (10) (39) (20)
Interest expense, net (33) (37) (58) (70)
Other income (expense), net 5 (8) - (15)
Income before income taxes 187 339 454 733
Income tax expense (55) (72) (131) (185)
Net income 132 267 323 548
Less: Net income attributable to non-controlling interests - - - -
Net income attributable to common stockholders $ 132 $ 267 $ 323 $ 548
Basic earnings per share attributable to common stockholders $ 0.51 $ 1.03 $ 1.25 $ 2.12
Diluted earnings per share attributable to common stockholders $ 0.51 $ 1.03 $ 1.24 $ 2.11
Segment Information
Financial information by segment is summarized below and in the schedules with
this release.
in $ millions, except share and per share data
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2024
2023
2024
2023
Net sales:
Europe $ 2,207 $ 2,350 $ 4,397 $ 4,850
The Americas 762 726 1,502 1,466
Adjusted EBITDA:
Europe $ 355 $ 432 $ 733 $ 904
The Americas 146 140 259 284
Adjusted EBITDA Margin:
Europe 16.1% 18.4% 16.7% 18.6%
The Americas 19.2% 19.3% 17.2% 19.4%
Condensed Consolidated Balance Sheets
in $ millions, except share and per share data
As of
June 30, December 31,
2024
2023
Current assets:
Cash and cash equivalents, including restricted cash (amounts related to $ 3,325 $ 1,000
consolidated variable interest entities of $6 million and $3 million at June
30, 2024 and December 31, 2023, respectively)
Accounts receivable (amounts related to consolidated variable interest 1,981 1,806
entities of $798 million and $816 million at June 30, 2024 and December 31,
2023, respectively)
Inventories 1,184 1,203
Other current assets 586 561
Total current assets 7,076 4,570
Property plant and equipment, net 5,576 5,791
Goodwill 2,757 2,842
Intangibles, net 207 218
Other non-current assets 616 630
Total assets $ 16,232 $ 14,051
Liabilities and Equity
Current liabilities:
Accounts payable $ 1,545 $ 1,728
Accrued compensation and benefits 387 438
Current portion of debt 387 78
Other current liabilities 756 762
Total current liabilities $ 3,075 $ 3,006
Non-current debt due after one year 6,045 3,669
Pension liabilities and other postretirement benefits, net of current portion 491 537
Other non-current liabilities 680 665
Total liabilities $ 10,291 $ 7,877
Commitments and Contingencies - -
Equity:
Common stock, €0.001 par value; and 9,910,931,085 shares authorized; - -
261,094,836 and 260,354,342 shares outstanding at June 30, 2024 and December
31, 2023, respectively
Convertible Class A, B, C & D stock of €0.001 par value; and 7,068,915; - -
30,000,000; 30,000,000; and 75,000,000 shares authorized; and Nil; 2,089,514;
2,089,514 and 786,486 shares outstanding, respectively at June 30, 2024 and
December 31, 2023
Treasury stock, at cost (2,037,589, and 1,907,129 common stock as of June 30, (93) (91)
2024, and December 31, 2023, respectively)
Capital in excess of par value 3,580 3,575
Accumulated other comprehensive loss (1,071) (847)
Retained earnings 3,509 3,521
Total stockholders’ equity $ 5,925 $ 6,158
Non-controlling interests $ 16 $ 16
Total equity $ 5,941 $ 6,174
Total liabilities and equity $ 16,232 $ 14,051
Condensed Consolidated Statements of Cash Flows
in $ millions, except share and per share data
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2024
2023
2024
2023
Operating activities:
Consolidated net income $ 132 $ 267 $ 323 $ 548
Adjustments to reconcile consolidated net income to net cash provided by
operating activities:
Depreciation, depletion and amortization 160 143 308 283
Share-based compensation expense 16 19 31 36
Deferred tax benefit (8) (13) (10) (12)
Pension and other postretirement funding (more) less than cost (income) 4 (16) (4) (25)
Other (2) 1 (1) 4
Change in operating assets and liabilities, net of acquisitions and
divestitures:
Accounts receivable (40) 79 (236) (30)
Inventories (28) 72 (20) 132
Other assets (54) (37) (105) (13)
Accounts payable 90 (155) (12) (328)
Income taxes payable or refundable 3 (35) 63 9
Accrued liabilities and other 67 (18) 45 (34)
Net cash provided by operating activities $ 340 $ 307 $ 382 $ 570
Investing activities:
Capital expenditures $ (177) $ (224) $ (385) $ (459)
Cash paid for purchase of businesses, net of cash acquired (28) - (28) -
Receipt of capital grants - 1 1 2
Proceeds from sale of property, plant and equipment 3 - 3 1
Deferred consideration paid (1) (4) (1) (4)
Net cash used for investing activities $ (203) $ (227) $ (410) $ (460)
Financing activities:
Additions to debt $ 2,757 $ 43 $ 2,812 $ 69
Net repayments of revolving credit facility (4) - (4) (4)
Repayments of debt (6) (24) (33) (44)
Repayments of lease liabilities - (1) (1) (2)
Debt issuance costs (29) - (29) -
Purchases of treasury stock - - (27) (30)
Cash dividends paid to stockholders (335) (299) (335) (299)
Other (1) - (1) -
Net cash provided by (used for) financing activities $ 2,382 $ (281) $ 2,382 $ (310)
Increase (decrease) in cash, cash equivalents and restricted cash $ 2,519 $ (201) $ 2,354 $ (200)
Cash, cash equivalents and restricted cash at beginning of period 811 883 1,000 841
Effect of exchange rate changes on cash, cash equivalents and restricted cash (5) (14) (29) 27
Cash, cash equivalents and restricted cash at end of period $ 3,325 $ 668 $ 3,325 $ 668
Supplemental cash flow information:
Cash paid for interest, net of interest received $ (16) $ 31 $ 14 $ 68
Cash paid for income taxes, net of refunds $ 61 $ 119 $ 79 $ 187
Non-GAAP Financial Measures and Reconciliations
Smurfit Westrock plc (“Smurfit Westrock”) and Smurfit Kappa Group plc
(“Smurfit Kappa”) report their financial results in accordance with
accounting principles generally accepted in the United States ("GAAP").
However, management believes certain non-GAAP financial measures provide
Smurfit Westrock’s board of directors, investors, potential investors,
securities analysts and others with additional meaningful financial
information that should be considered when assessing our ongoing performance.
Management also uses these non-GAAP financial measures in making financial,
operating and planning decisions, and in evaluating company performance.
Non-GAAP financial measures should be viewed in addition to, and not as an
alternative for, the GAAP results. The non‑GAAP financial measures we
present may differ from similarly captioned measures presented by other
companies. Smurfit Westrock and Smurfit Kappa use the non-GAAP financial
measures “Adjusted EBITDA,” “Adjusted EBITDA margin,” “Adjusted Free
Cash Flow, “Net Debt” and “Net Leverage Ratio.” We discuss below
details of the non-GAAP financial measures presented by us and provide
reconciliations of these non-GAAP financial measures to the most directly
comparable financial measures calculated in accordance with GAAP.
Definitions
Smurfit Westrock and Smurfit Kappa use the non-GAAP financial measures
“Adjusted EBITDA” and “Adjusted EBITDA Margin” to evaluate their
overall performance. The composition of Adjusted EBITDA is not addressed or
prescribed by GAAP. Smurfit Westrock and Smurfit Kappa define Adjusted EBITDA
as net income before taxes, interest expense, net, depreciation, depletion and
amortization expense, goodwill impairment, impairment of other assets,
transaction-related expenses associated with the combination of Smurfit Kappa
and WestRock, restructuring costs, legislative or regulatory fines and
reimbursements, share-based compensation expense, pension expense (excluding
current service cost), and other expense, net. Smurfit Westrock and Smurfit
Kappa view Adjusted EBITDA as an appropriate and useful measure used to
compare financial performance between periods. Adjusted EBITDA Margin is
calculated as Adjusted EBITDA divided by Net Sales.
Management believes Adjusted EBITDA and Adjusted EBITDA Margin measures
provide Smurfit Westrock’s management, board of directors, investors,
potential investors, securities analysts and others with useful information to
evaluate Smurfit Westrock’s and Smurfit Kappa’s performance because, in
addition to income tax expense, depreciation, depletion and amortization
expense, interest expense, net, pension expense (excluding current service
cost), and share-based compensation expense, Adjusted EBITDA also excludes
restructuring costs, impairment of goodwill and other assets and other
specific items that management believes are not indicative of the operating
results of the business. Smurfit Westrock and its board of directors use this
information in making financial, operating and planning decisions and when
evaluating Smurfit Westrock’s and Smurfit Kappa’s performance relative to
other periods.
Smurfit Westrock and Smurfit Kappa uses the non-GAAP financial measure
“Adjusted Free Cash Flow”. Smurfit Westrock and Smurfit Kappa define
Adjusted Free Cash Flow as net cash provided by operations as adjusted to
exclude certain costs not reflective of underlying operations. Management
utilizes this measure in connection with managing Smurfit Westrock’s and
Smurfit Kappa’s business and believes that Adjusted Free Cash Flow is useful
to investors as a liquidity measure because it measures the amount of cash
generated that is available, after reinvesting in the business, to maintain a
strong balance sheet, pay dividends, repurchase stock, service debt and make
investments for future growth. It should not be inferred that the entire free
cash flow amount is available for discretionary expenditures. By adjusting for
certain items that are not indicative of Smurfit Westrock’s and Smurfit
Kappa’s underlying operational performance, Smurfit Westrock believes that
Adjusted Free Cash Flow also enables investors to perform meaningful
comparisons between past and present periods.
Non-GAAP Financial Measures and Reconciliations (continued)
Smurfit Westrock and Smurfit Kappa use the non-GAAP financial measures “Net
Debt” and “Net Leverage Ratio” as useful measures to highlight the
overall movement resulting from its operating and financial performance and
its overall leverage position. Management believes these measures provide
Smurfit Westrock’s board of directors, investors, potential investors,
securities analysts and others with useful information to evaluate Smurfit
Westrock’s and Smurfit Kappa’s repayment of debt relative to other
periods. Smurfit Westrock and Smurfit Kappa define Net Debt as borrowings net
of cash and cash equivalents. Smurfit Westrock and Smurfit Kappa define Net
Leverage Ratio as Net Debt divided by last twelve months (“LTM”) Adjusted
EBITDA.
Reconciliations to Most Comparable GAAP Measure
Set forth below is a reconciliation of the non-GAAP financial measures
Adjusted EBITDA and Adjusted EBITDA Margin to Net income and Net Income
Margin, the most directly comparable GAAP measures, for the periods indicated.
in $ millions
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2024
2023
2024
2023
Net income $ 132 $ 267 $ 323 $ 548
Income tax expense 55 72 131 185
Depreciation, depletion and amortization 160 143 308 283
Transaction-related expenses associated with the Combination 60 - 83 -
Legislative or regulatory fines and reimbursements - - (18) -
Interest expense, net 33 37 58 70
Pension expense (excluding current service cost) 29 10 39 20
Share-based compensation expense 16 19 31 36
Other (income) expense, net (5) 8 - 15
Adjusted EBITDA $ 480 $ 556 $ 955 $ 1,157
Net Income Margin 4.4% 8.7% 5.5% 8.7%
(Net Income/Net Sales)
Adjusted EBITDA Margin 16.2% 18.1% 16.2% 18.3%
(Adjusted EBITDA/Net Sales)
in $ millions
Last Twelve Months
June 30, December 31,
2024 2023
Net income $ 601 $ 826
Income tax expense 258 312
Depreciation, depletion and amortization 605 580
Transaction-related expenses associated with the Combination 161 78
Impairment of other assets 5 5
Legislative or regulatory fines and reimbursements (18) -
Interest expense, net 127 139
Restructuring costs 27 27
Pension expense (excluding current service cost) 68 49
Share-based compensation expense 61 66
Other expense, net 31 46
Adjusted EBITDA $ 1,926 $ 2,128
Reconciliations to Most Comparable GAAP Measure (continued)
Set forth below is a reconciliation of the non-GAAP financial measure Adjusted
Free Cash Flow to Net cash provided by operating activities, the most directly
comparable GAAP measure, for the periods indicated.
in $ millions
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2024
2023
2024
2023
Net cash provided by operating activities $ 340 $ 307 $ 382 $ 570
Adjustments:
Capital expenditures (177) (224) (385) (459)
Free Cash Flow $ 163 $ 83 $ (3) $ 111
Adjustments:
Transaction costs paid 23 - 57 -
Adjusted Free Cash Flow $ 186 $ 83 $ 54 $ 111
Set forth below is a reconciliation of the non-GAAP financial measures Net
Debt and Net Leverage Ratio to total borrowings, the most directly comparable
GAAP measure, for the periods indicated.
in $ millions, except Net Leverage Ratio
June 30, December 31,
2024 2023
Current portion of debt ((1)) $ 387 $ 78
Non-current debt due after one year ((1)) 6,045 3,669
Less:
Cash and cash equivalents (3,325) (1,000)
Net Debt $ 3,107 $ 2,747
Adjusted EBITDA (LTM) 1,926 2,128
Net Leverage Ratio 1.6x 1.3x
(Net Debt/Adjusted EBITDA (LTM))
(1) Includes unamortized debt issuance costs.
Ciarán Potts
Smurfit Westrock
T: +353 1 202 71 27
E: ir@smurfitwestrock.com (mailto:ir@smurfitwestrock.com)
FTI Consulting
T: +353 1 765 0800
E: smurfitwestrock@fticonsulting.com
(mailto:smurfitwestrock@fticonsulting.com)
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AnnouncementREG-Smurfit Westrock plc Smurfit Westrock announces capacity reductions and facility closures
AnnouncementREG-Smurfit Westrock plc Smurfit Westrock to Announce 2025 First Quarter Results on May 1, 2025
AnnouncementREG - Smurfit Westrock PLC - Total Voting Rights
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