Earnings call transcript Q2 2023

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Operator

Good day, and thank you for standing by. Welcome to the Q2 2023 Sealed Air Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]. today's being that advised be conference recorded. is Please

hand over Executive to would go Investor now speaker conference to like ahead. Please Treasurer. Sullivan, I your the today, and Assistant Relations Director, Brian

Brian Sullivan

everyone. morning, and CEO; our good and Semach, you, With today Doheny, Dustin are me CFO. our Ted Thank

visit note we're what with page. where Before to enhanced from sealedair.com to would illustrate we going. we provided presentation have who downloaded I call, we begin are, do visuals where and a Please our we and be webcast like that slide today's presentation can Investors our

Statements you stating These slide for statements during this review the in to to that Forward-Looking outlook statements. future solely to call. based or available on information the in and information made predictions release this entitled our call earnings are is presentation, section forward-looking encourage periods Statements applies We are which now management's us.

SEC's may are our our differ our factors updated quarterly these due performance number on annual Any as of a to report revised XX-K on listed and Additionally, and future Form of in recent most factors. on We that XX-Q to reports GAAP. on also the find financial current Form discuss on Form our reports do on or not you which measures website X-K, and conform can U.S. website.

find GAAP U.S. the throughout the release. in find reference the Included that important of these today's U.S. earnings our you GAAP measures results our will non-U.S. will information You use we correspond to appendix on in and presentation. their measures GAAP reconciliations financial presentation, to of

to Slide call the over Ted? turn Ted. to please now will turn Operator, I X.

Edward Doheny

questions. a quarter XXXX and will company, in this for We're SEE automating take our joining journey outlook Grow environment. to provide the challenging X.X to part cost packaging discuss thank solutions. growth out sustainable up we'll our updates return your open and and our call. to our Brian, program to our in to called Take-Out the After as you Today, best that, you, a from Cost continuous Reinvent our world-class reinvent introducing new and for packaging on we results second of SEE Thank post-COVID call

for Starting of to through events. are for visibility what chart, recaps going today, we're XXXX this episodic our the We'd Take-Out The since lens where On where and the Slide we program. but Grow adjusted EBITDA XXXX major set you Cost how and growth. XXXX we to repositioning we we chart like see performance importantly, give with for X. through a to stage future most are show

be, as The to case and That three with action Reinvent XXXX, As and launch were wanted the faced we operating program on after the the costs we our entered SEE challenges the had company's War Diversey to stagnant was major Plastics earnings our been power we for leverage years. sale. remaining previous such start stock and of on stranded where not price based for XP'S. our were

processes sustainability. world-class. disruptions, including million, X% the COVID and over built Through growth we overstocking. retail food SEE operating way annual globally. In greater demand Reinvent on world the and and of automation, strategy shortages than points M&A. top-line the basis wide model, margin performance, We inflation, growth, for and pillars products, centered early established profoundly aiming caused Reinvent The to savings the transformation SEE world-class to on become shook our and XXXX, a brought XP'S: rapid We and expansion SEE surges XXX e-commerce sustainability. impacted Reinvent the chain in $XXX of digital COVID people, product tone based life setting SEE, supply realized

transformation Brand, Corporate packaging sustainability solutions and SEE new into our introduced an company. digital we quarter, highlighting Last our automation,

$XXX major million million driving growth Grow the program expand evolving be to XXXX. to program opportunities. of to Take-Out savings X.X fully Cost resources solving realized will SEE annual Cost SEE the focus of and We to This by Reinvent and on end $XXX growth redirect are productivity from now to problem to Take-Out crisis

We accelerating automation organization, launching enabled verticals solutions. are an effective go-to-market team and efficient to solutions sustainable product SEE materials and transforming by business across focused and our digital new innovations

We driving low we the operating enabled engine, will with growth, together, by which Cost power fueling optimizing single-digit Take-Out operating improvements. margin our increase result class. digitally in productivity world to SG&A our footprint it our journey chain earnings all Bringing business expansion to are Grow, further and targeting leverage in the our will in SEE supply and

transformation, of needs XX% our like to Slide from In moving approximately break we platform. the adapt our down geography, of digital representing ability and to our are reflects We to market, in transactions growth quarter, by today. This increase approximately growth changing XX% QX not our sequential enabling our how us to of serve creating XX% in mic, customers total we showcase the digital speed second online XXXX QX are Now of online X. We'd to of digital reaching grew rapid sales, a company to our customers, efficiently high-quality growth. XXXX. product

of the percent for our each slide, the can of bottom online business Towards the current you of see transactions verticals.

Ready preferences evolving seek Protective meet and XX% brand consumer retailers of business. are solutions create the at-home automated our shifting over as total experience. respond in needs is and penetration to These representing to processors, food Starting of Consumer an to Solutions solutions, largest revenue. owners to designed Our with they

all SEE strong a processors in proteins grew with with from to approximately in Consumers proteins. dynamic XX% The retail several past bright being the decelerating Solutions regions be lower-priced and for gains resulting digit primarily market demand. down premium declined rapid from trading our This impacted end impacted In quarter. spot are in solutions by quarter, in hardest. increase major Ready driven volume, the has discretionary in spending, the quarters continue in softer over demand Consumer to low second markets. inflation single share EMEA hit the Automation processors meat food,

retail cycle in U.S. market, the protein showing continue. digits expect XXXX, softness to global XX%. double all softer Throughout cattle partially grew our into APAC Australian with a and momentum all impacted business, regions headwind from The the the herd across markets. XXXX Automation by strongest positively to offset a secular cycle, greater will than driver the will tailwinds be these for business. growing which we continue the Automation already Despite be

The next growth and representing now than of greater mid-single-digit quarter business experienced sales in vertical, counting Fluids the Liquibox. Liquids company before XX%

between modest Liquibox and food continue fitment We and this Material Science Automation. bringing see in vertical synergy the medical business recovery strong growth the We're service further CRYOVAC and capturing technologies. attachment into to

is and which our of business of variety e-commerce performance on focusing Solutions, approximately Weak represents vertical business impact third continued markets Protective and from Automated destocking XX% to end ranging today, Our channel quarter. demand volume to in our the market fulfillment. industrials a customers

SEE fiber-based We're of our by customers solutions. review and engagement our We're capabilities approximately performing a digital focusing of this We're optimize our further MySEE through and to actively for vertical's protective this around value. increasing reaching platform, and efforts expanding unlock Automation vertical XX% revenue. strategic on turning more areas representing now portfolio

closure Thermal we example, As a Temperature announced small the Assurance of [indiscernible] business. our recently

most and Digital our X. Slide namely into pressing customers' Transitioning SEE's all packaging Automation, We now Sustainability, in crucial challenges. delve pillars, growth to addressing

automation the significant value-add Automation growth capabilities exhibited year-over-year second annual strong market protein year. million, increasing Food for for We at the XX%. this continued commitment approximately over up to $XXX reached anticipate in from incremental share up by particularly major revenue milestones, our was approximately SEE. new delivering we demonstrating enable growth producers. robust quarter, our quarter, in profitable During gains to delivering XX% customers XX%

several achieved significant Digital With milestones. we regards to solutions,

As digital second customize run an digital their print them Transactions example at packaging. is products MySEE of printing how digital introduced fueling quarter, demonstrating customers' bags facilities, our surpassed prismiq in unit at to the to rate robust on billion platform a SEE Automation, $X engagement. of we annual new enabling printer the point protein

introduction the successful Online Design process lead of times. Studio, graphics streamlined Following web-to-print onboarded experienced customers high-speed reduced print solutions, and our

reach with online, to SEE. operational continue customers move and As to the make we of more company easier unlock business we do it efficiencies, new

we're more we front, The a circularity Sustainalytics have July, initiative share the of in avert collaboration trace. On from sustainable making MSCI and protein annually for to we incineration. in our recognizing pride waste world improved, that progress. announced solutions, the great it. Sustainability XXX Back together take landfills unique plastic deliver proud industry than We scalable better or Australia, will than created ExxonMobil to our ESG ratings and tons with our we've partnerships find

is example and returns. create of This bring combination auto how pouch another of digital Turning dispensing Slide technologies film, and customer the and value Liquibox connectivity X. equipment best-in-class prismiq to CRYOVAC

This environment. barrier over enables Xx technology speed of the waste see the storage automated of use a traditional improved back store lemonade seal right-hand service, within and slicing a a compared of slide, source fill efficiency CRYOVAC top offering service On greater you squeezing, quick reduction restaurant given the side throughout bags filling safety fresh reduces form than operational XX% day. seamless solution requirements, while and the of enhances lemonade with of and lemons,

create digital savings for owners, operational bag to but replace carryout a to and the QSR solution life plastic bring our in-store jugs growth days, prefilled This opportunity designed can sources for new the only the carryout example, In customers through retail We're and additional not lemonade, rigid over an also customer. profile were enhance will sustainability this from operational quick for $XX with packaging. marketing savings, opportunities rigid improved containers introducing in brand new box million more to a revenue efficient hours fresh for service disrupt restaurants. This experience. consumer application shelf formats enables extend less

Now turn our results. Dustin financial the to to I'd call review like Dustin? to over

Dustin Semach

and Ted, everyone. you, good Thank morning,

second Now results. moving to quarter's

reduction. from $XXX basis $X.XX net X% first sequentially, on of ago the per Volumes on and to M&A In since Sequentially, Slide partially the X% the stabilization year in by EBITDA XX% but $X.XX about million earnings of of EBITDA was were driven first in volumes X% relatively sequential to quarter the of from constant of improved beginning cost a turn excluding increased currency effects, in down compared reflecting Adjusted currency Let's basis, the XXXX. year. down a flat compared $XXX X% were million volume to down share X. the quarter constant XXXX, adjusted and a last quarter, sales improved sequentially was quarter year.

to [indiscernible]. destocking as more by of Protective was top-line in driven X% food pressures well and Slide offset sales contributed to approximately continued X. weakness as than declines market million continued $XX by Liquibox organic in Turning customer

This Second Protective. compared quarter last from or volumes $XX million down within of adjusted to included X% of $XX was XX million, mainly basis driven points. EBITDA year Liquibox, which XX.X%, decreased $XXX performance million margins lower with by contribution

in XX.X% earnings adjusted diluted to to repurchase year. our adjusted share the not rate the period in $X.XX, quarter. in relates last of same did shares XX.X% it was any quarter the As per We second second tax compared

Our weighted second in $XXX.X outstanding XXXX average quarter diluted of the shares was million.

X. was Slide Fluids and quarter. Volume demand. business basis from net on quarter, by quarter basis, by XX% of with due second the price XX.X%, adjusted costs, of X% net to Volume unfavorable Automation million by operating In our the lower price year, Liquibox XX offset at points, weakness $XXX slightly million. year-over-year partially flat dollars up food versus organic first up of up sales $XX were Food primarily constant EBITDA in Moving in the contribution retail in $XXX in in the realization realization. an to continued growth with last driven and second margins organic Liquids million mainly compared to offset up was was

continued quarter industrial, second in pressures $XXX driven down activities. million regions electronics and in destocking volume were net continued and by customer from of fulfillment Protective all XX%, markets market sales declines

dollars primarily net down margins lower volumes points basis price to second expect offset million. destocking favorable was Sequentially, adjusted XXX to XX.X%, half. EBITDA realization partially improved by end points by and demand realization While quarter margins constant driven and in the XX% basis associated are to due leverage, projected control. of XXX Protective operational net the cost headwinds price and favorable activities of down $XX at with we moderate, second market EBITDA continue in Protective million in $XX

we offset growth in region. Americas quarter In constant being net flat. a dollars, XX, APAC by EMEA review Protective with Food, By Slide and On XX% our sales while we by was grew net X% X%, second down and sales segment were by decline of in by X%, region, XX%. down

capital efforts quarter, source second Now was let's Slide on the cash of free million the to free has turn in Through flow same continued a $XXX Working to of cash our through flow of to a cash ago. cash improved XX. reduce period $XX compared year use million inventory.

disclosed of However, offset million. by internal service were deposit the benefits previously revenue $XXX

have impact been of free cash million. deposit, would of flow $XX source a Excluding cash IRS of the

outlined for we Slide allocation strategy focused On shareholders. capital value XX, maximizing our our on purpose-driven

the net As a quarter approximately anticipated, with of second closed out we leverage X.Xx. ratio

use We generation flow to de-lever expect and throughout the into to XXXX. cash free year

to We are addressing optimize opportunities working unlock to and value. actively our portfolio

turn outlook. Let's XXXX our to XX Slide to review

guidance the an growth compounded Based anticipated second on Our demand recovery year through by the at destocking, recovery L-shape full-year beginning the we market half XXXX. post-COVID and XXXX, into of weakness, V-shaped a a of expect continued end XXXX lower reflecting environment. in

our full-year following. which guidance, As the a result, we includes are revising

for to which basis midpoint contribute down net $X.X expect and the range of $X.X million XXXX. on X% in We sales to approximately sales at a billion, down organically. the to Liquibox We now reported be in billion $XXX expect is X%

be half slight in year, fourth quarter. volume is volumes the XXXX, will in similar first of stabilization throughout the uptick the reflecting half Second to the

be We to $X.XX. adjusted margin adjusted expect $X.XXX EBITDA in billion, to $X.XX the EBITDA assumes be of EPS range in XX%. to range adjusted which full-year billion $X.XXX of is Full-year expected to of the approximately

implies flow, the XX% range XXXX at be approximately settlement which excluding of $XXX million conversion disclosed a flow of full-year cash free $XXX tentative expect previously tax We to cash midpoint. the in free the to million,

million XXXX, third share. and $X.XX $XXX the per billion to the quarter we be $X.XX EBITDA of net adjusted to earnings of and an per to be share $X.XXX for sales to between million range Lastly, $X.XXX of expect in billion with $XXX

As you earlier, of I beyond. earnings we XXXX Cost volume to to part Grow current environment, due Ted as Reinvent and in X.X Take-Out launched to mentioned the restore to growth look updating and forward to calls. initiatives the the and earnings details targeted growth end our XXXX million of the of annual $XXX on million to subsequent more you by progress on giving and savings $XXX

closing the pass back to now me call Ted let Ted, that, to With over for remarks. you.

Edward Doheny

Thanks, Dustin.

of combination SEE introductions growth. the we product remainder XXXX and and the X.X As into to revert XXXX, new us single-digit help to look initiatives of Reinvent will low

cautious be to economic of continue lingering inflation. global on We impact the outlook and

that are program markets. and growth to earnings to end significant Grow position confident will in address us us our We back path to the Cost put opportunities Take-Out our

I performance. also to to a to Their dedication recognize take drive want to hard our company work people. world-class relentlessly moment and our

Operator? I that, open the questions. call With for

Operator

[Operator time, the will you. Thank At Instructions]. we begin this session. question-and-answer

from first Our question Baird. comes Panjabi from Ghansham

Your open. line is

Matt Krueger

segment for morning. Hi, detail details. Ghansham. could This of is expectations on your I second XXXX. all half Matt sitting that Thanks for was the in good Krueger the you by hoping added provide for some volume

details second to Your And volume those break the the in each the And some guidance appears versus Why be of Packaging. the of businesses by in if imply the in this you weakness addition that July? be rates to food great? a would quarter? were run case to would want during for what even slowdown subsegment, out

Dustin Semach

question. this is Great speaking. Hey, Matt, Dustin

and highlighted prepared of Food. with the go starting remarks, We of back couple points. a you some So to

at starting and half cycle but the beginning year, since a really what cycle of the you in well, year. being now think the the QX what's Australia of U.S. looking remaining fully. the with you're shift not degree in herd in It's portion cattle is as some the partially about going to the offset of If happening year, throughout second

that relates the volume impact to market -- in what And that's half as second it so is compounding Food.

half general though, in second about Keep and in Food business if volume half stabilization. mind, from Protective, at think you're holistically looking the you first to

still second to And talked obviously the weakness move in seeing compounded we market that's demand. by you Protective, we're end destocking. being looking half, then If at about

demand in market. you the markets, -- as as logging longer weaker extend the if seeing cycle, end the compounding destocking So in you're into our QX that the well the

half So declines for a those high second from single-digit volume driving were perspective. factors in protective the

Okay.

Next question?

Operator

Our comes Maria next William Lawrence from from question Blair. De

Lawrence De Maria

Thanks. morning Good everybody.

understand I like would share As to let's versus, ask of growth declines some downs. opportunities, trade want volume of say, much some market the the and some of declines losses of in to switching the I terms about

volume kind losses due have pricing versus actions? lost in are of can of to what of you. Thank potentially second market the half? you declines and destocking share And share you there the kind discuss So any

Dustin Semach

All Ted and Sure. off, is this start chime Semach. I'll then Dustin in. right, Larry, can

prior you at well, back if the as go segment, So going look to by up question kind of I'll Larry.

the So what range X% if we're of the holistically, Food, down of the in second it at you seeing half volume as roughly look is right, think year. in

at down little it's when in at There's one then year-over-year looking to a of X% to more I'll have You bit other offset being that's Protective and our degree look I'll holistically. price this we share a move quickly. because in point let growth And market, -- loss about some because Ted back come you point we're to uptick slightly comp. of to about down see And that areas.

second When in you Protective the more of price. come we're year, on back pressure seeing to half the

on first really seeing the half. commodity the from that side resin coming You're

So offset half you about in be about is high Ted to a it price in it is the down talk down bit single some the see market, each loss about rest which second XX turn to destocking is by I'll of growth. and And of the growth share points half digit, volume holistically X% to other going the little with area. XX,

Edward Doheny

to resins. Market that did And we we We of picking into first, if resin rid look about the customers did we We the we the we down have up but like the got by is our with happening Food a hopefully back, who resin didn't stabilizing, back gained quarter. the that feel have the the for get should talked we've Sure. what's the we third piece, got stock carryover because little end -- that those that of bit on have have. year. share think they slowing talk lose they with loss slowing to still a converting

on of part share the our gain other The driving the some is growth. Automation with

On We that some the Food got some XX% XX%, strong, a driving and got the Food We of the still growth part pretty we great talked side, alone, year year. really up business in shortages have pickup. backlog. as of to about we for next that had into the shared we

being can activity calling now, us right Automation, productivity Some help our customers of of opportunities new strain, to under for Automation their fighting half them still in, their right in do And kind reducing with we now, that working the we the on Food going on think helping what second them they're with CapEx, the and issues, we're we're has next in year. into strong on products.

fiber the on of the the Protective is rest strong but with through the the working we're reduced half, gain that that been be push the we'll second destocking, quarter. seeing That that. year. in really that plastic, still On is in -- still we've the more the but have side, pressure will the the the We're still there. share out seeing fiber is We of think playing

in we Protective side. see some the do So stabilization

and Same year and now, as we fiber-based e-commerce remarks, coming the second reaching on -- really on and thing in the going building getting with the reach, next some of board year. also the on side half half. year solutions the on stabilize the our prepared opportunities saw growth the Automation, going also But with is customers tough, to the getting right into with Protective, second significant half Protective have better you we moving first think platform, coming more

Okay.

question? Next

Operator

Thank you.

from from BfA is question Securities. next Staphos George Our

Your line is open.

George Staphos

Ultimately, Hi, spell two is savings for with on Ted, you to the million outlook X? the on $XXX what My And to the million pressure they, outlook? that cadence are combining everybody. the the volume savings the on details. should Slide morning out $XXX be how Thanks tested question a CTOXGrow. good parter volume

in Automation, you of ask, and half here of of issues the cycle, back in shouldn't as past factors kind growing be deal. back CapEx. second reason company's perhaps the question, are the that These big I holding view were a cite the that quarters customers talked and And this is your the the was the cattle of they not year, about quickly that because are some

need on ultimately there? get have closer the So into customers play are much. that in does SEE, to view in and a the closer cadence better Sealed get the volume -- the need Air you its And and maybe to quarter. Thank to outlook savings turn, customers will so good to your luck how

Edward Doheny

question. good George, Hi,

some Let demand then to that me shift the we of let about we from and close second and are I our will quarter Dustin unpacking start to why first numbers, question answer customers had how just with quarter. those

Dustin Semach

Thank George. you, you, Ted, and thank

step to over I right? we're So million want to back to take quickly just reminder, million talk XXXX. about $XXX couple Reinvent a and SEE, the as answer through years is $XXX that a next of announcing question, Just the outlook

focus roughly which to that back in resulted move is million, to throughout continue savings in to we're Going beyond into initial amount restore of to $XXX point kind the power. savings. X.X, going continue make of 'XX was there the and the as 'XX, SEE Reinvent we driving and to commitment out the the And cost $XXX necessary taking million earnings on to over markets

-- this midpoint million actively already engaged and are think QX there But will you'll in what if the teams speak. that see and to is $XXX QX. portion $XXX be see about The XXXX the and of so and about going the you're appear million, begin cadence $XXX executing And going the off XXXX. million feather you then at as remaining to in running. -- in back XX% to we XX%, We're to

it back Now you, I'll Ted. to turn

Edward Doheny

customers. our Yes. part question being close And so to then George, second of the about the to

to especially now, with right the they've side, right customers now in through demand change. pressure where Food the Going the extremely our this close seen

side. that's announcing see, one much the we in We're our the adjustment where some with or to have that demand for see going we reduction that You side can by with second what's on their the feeling larger greater and you half. of quarter seeing publicly look what are customers visibility year, so later, hear are we

focus still been releasing what To had the of fill backlog, to Automation, good of their intense cost year growth right the the their is the build has one, come the that help backlog we we pretty is can strong and second into the first with for to bookings. in is now pipeline them our reduction getting through in strong the cost strong. their going in and and quite issue reduction the still The up question, how strong that have reduction pipeline of What Automation part the can that's to those fighting end and the demand We Automation your with we XXXX. out heavy get on get take on reducing We've that this part we is and half, that about converted. we're through in hit. been feel we're side we going

forward. bright some We us for going is to have strong, we work the Automation really do, spot think but

Next question?

Operator

Thank you.

Truist comes next from Michael from Roxland question Our Securities.

is line Your open.

Michael Roxland

share. the on packaging modular competitors in it packaging of talk acquired Food vacuum targeting gain market tends volumes Fluids, dairy, everyone food you much a my in in volumes to in you what regaining about in the for solutions last And can volumes last recently its increase have go-forward mentioned quarter your your your and a year. to question. you also One Food XQ? basis? Thank you approach food -- confidence for larger about protein, progress packaging How lost additional Ted, business from made taking park,

out to Thank how that going just I you. you're competitiveness? find to wanted increase So address in

Edward Doheny

we first what comfortable our on the are we're directly. part, before, how So building with said I customers just feeling

the So again, what space. in Food feel pretty confident we're on with on doing the Automation the customers

we to that that resin our them back. in good piece, to can didn't have the deplete regain our past, resin service our they someone we have subject which we is with Again, with On business a with very that we as inventory else. the the with get different have feel we where customers, brand, get

go customers, engaged one, good myself being let's personally those So feel at that really get even about business. that with

in well part share. The in taking above our market what with our part been Automation, second competitors of being growth has question your of the doing Automation

about had with lost good major So five back business taking that. a that making about fourth of ago. we We years we largest customers, our feel we back, quarter, gains. We that talked really conversion actually got that in the over one

We slides the new of in. actually have on have of it of some we equipment place, brought in one that that equipment the

good very about feel that. we So

We we we feel have feel products. have best like best equipment. like We the the

We have the product, get feel about designs have always our We'll new But brand we customers, coming really can good so competition. in business. incredible have very place, CRYOVAC feel it. our I with with good go the we

We have a service tremendous sales and team.

So we the despite in is think tools, the competition I place confident feel we're giving team doing. quite better a good what

question? Next

Operator

you. Thank

question Phil next is Our next question with Ng from Jefferies.

is Your line open.

Philip Ng

Dustin did cost a great effort. job in talking about the element of restructuring your

long it XXXX. will on How kind we'll think the seem side things. initiatives take volumes do see could into you're calling you bottom And like line? growth some perhaps of it the challenges these of us the think Ted, on help out through So of hold linger

and we look curious, So out perspective growth XXXX? when in level what's a to from getting to confidence top-line your earnings back of

Edward Doheny

already I'll used -- some did clean already of of And question. lines and share clean. great have phrase mom, the sweeps the I've Dustin take for and -- here, the there because Great to having saw a a broom but Dustin used set Out my it's new where eyes, Cost I've been

of What have Cost promise on we line we didn't really So Reinvent, what is will see and on success continue you on to good savings. sight. under there building the those he say of Grow to Take-Out deliver our over

taking was that that service the there, we out our our had we had. resources taking take part look curve We've so We put through a at gone we COVID period. tremendous to many called redirected the if already business. crises we bump of growth redesign that Slide crisis. element, X, technicians, world, is team, actually, the on So where products the around care engineering COVID to of on our out care our of scientists, you that that care originally of resources And

us to slide So your that confidence we the above we low to bring growth growth. answer single-digit get our can put to are on in as question single-digit growth, committing -- my back plans internal

we talked So that? You do fruition. segment, Feel that. as Digital on our highest so the already Automation fastest to on That's The feel how are Liquibox. this forward? we good. year, to into margin Solutions there going growing, strong do our we be double-digit with doing about going drive we so How out? are far got growth quite right -- Yes. inorganic north is really good largest growth coming -- about we coming now X.X% in just very

that us, the that our on behind putting again Going engineers feel COVID good Digital that. Solutions, really about crisis our hump

of We this new breaking realized have coming Reinvent there. we new out then products, products that fiber-based low out area those to designing again, curve out, those And trays new beat X.X, now on out. to the coming volume single-digit growth fourth have new for have

beat again, promise, forward. just that cost growth to side, under going side, beat going have on confidence So high we're like that the the I going on we're to

question? Next

Operator

you. Thank

Our Wells next Fargo. comes question from from Hajde Gabe

Your open. line is

Gabe Hajde

side volume about you Slide question #X, Good differently. to the to honing Dustin. morning. Hey, X% the X%. of on on And a get bit about single-digit where growth. hand Maybe in then you talk slide, talk I'll low further CTOXGrow, right the enabling growth little ask I'm you sales of

there price is some acquisition-related as So growth. I'm gross assuming well as in implied

to that that focused near revenue. lower to guidance, in just to M&A gross $XX that? or contribution safe of sort assuming be and What's And you're you're you'll to on you're calling some lumpy, to back in in in deleveraging is be driving back guess it So given And the say that clarify million come I from tends term, net fairly the that think that price guess does XXXX algorithm? beyond? I I down, on Liquibox get

Dustin Semach

Okay.

question. you net correction. great So course Cost on chart kind Slide price. Grow around comment comments first I'll made And to Take-Out then see that this X, you on of on the and

single-digit period. it think point, $XXX in deleveraging, represents, are to that you out. So call that So through an pointing if that on calling annual what when we're to short $XXX the organic the right And right? okay? your dotted is savings And XXXX. at of capital we're if now number low And line, you that's we focused it, million about million that's it allocation, during term line, you growth look then what

general, I market enable Cost us where get balance net negative, on pricing price we much Take-Out In kind driving back excluding resin was will and where that curve in pricing, the right-hand through idea that of when would end into holistically on to we couple view can to the our somewhat, an years, of over further because will at demand today, right, that say, to get terms Grow, next see for side realization about is that sheet that we short-term is that XXXX, leverage. talked be of

different will and in markets the on to see right place, environment, able operating a hand on be then SEE you corner. Pricing bottom can we're to our model, get back which

Edward Doheny

Yes.

a issues issues step Liquibox. operational being about The had We short Liquibox had We've talked had issues. second the a quarter right We've business. you fix even rates. in into into to part, We've in brought that. it. We quarter. what adjusted about now now Ted, quality like we're the we on team of where in down the issues feel from plants. there CRYOVAC Gabe, some top some mentioned coming before, the the is this We personnel right the

we and we think term Right down why significant took we year. short that and are I opportunities. our CRYOVAC so on some that of. We've number believe in those we been in and customers, face-to-face market, that's team for our the team, also, slowdown with team we've have our fixed Liquibox with they've issues, the with now seen there, top the have the the

the last model. synergy, one though, on the Even we're ahead. though actually are cost the on we are volumes the the in cost synergies there But down, ahead

up, we synergies far get so we'll Liquibox. volumes think And exceed the on where the cost you back the

and so 'XX Fluids growth Going part business, we're still and algorithm quite is about in into that. definitely getting with 'XX, 'XX, Liquids of that the to back the growth confident

Next question?

Operator

Thank you.

question comes UBS. Josh next from Spector Our with

Your open. line is

Joshua Spector

I I more wanted on within question. guess for taking specifically to about thanks side, one Protective. Yes, ask the my thing margins was cost

sales in pretty on You up XQ step had sequentially. a nice flat

be expectations earnings that see you about is down, aggressive? on half, but for you I second Protective up? talked actually wondering just think So I that the guess, if pricing of of margins could Or up kind net year-over-year cost, you fourth price could do too think your in quarter? And improve,

Dustin Semach

Josh. question, Great

is segment in-house best stabilization Cost talking those I points benefited QX as mentioned us that second And so the benefiting actually the the two would of the to about the obviously, an further. but lot we volume And you savings splitly earlier, performed be which with think focused as will which sequentially what of 'XX, cost One holistically. really of say first we dynamics a that half cost first on year and coming Having stabilization. think Protective to I'll and year, if half from volume now, or $XXX in in control, of will a the I about really gives Take-Out half half proportionally different couple $XXX we're million call said, is, Grow, million, really about opportunity of our Protective haven't out.

If and get first of it absolute in half the the where are you to Protective high in to think QX about QX. the the teens the point, should to XXXX. you an similar as -- margins second was for very sitting you dollar QX time And of to your basis, on going be you by for have roughly think

Edward Doheny

by -- in portfolio, is are remarks. we add highlight on will volume. actually margin continued Protective at new thing mix the the Automation prepared to the growth portfolio the looking have only the side driving we of changing to a into portfolio we shift product in half mix on The with the review the in that did in products going the year. expansion coming the that the The will different second of and in be Also planning and

we're have So second margin planning the That's in we again what on. half. expansion should

Next question?

Operator

you. Thank

comes Markets. question next RBC from of Our Viswanathan Capital Arun

is open. line Your

Arun Viswanathan

questions. Great, my taking thanks for

second midpoint million the the $XXX second guidance, the a look of if $X.X implying and number -- say, let's of kind the for at we So billion half. like for this year

you're yes, billion that exiting $X.X rate. at So of kind

pretty You will be facing easy Protective. in comps year next some

maybe of also as in next returning as to well. way the SEE little upper year? that bit getting And about half to are mid- that far Food to range? in that operating Thanks. do would level what model the positioned mind envision you maybe How as growth keep a high single-digit EBITDA prevent better range? the is risks to from Do growth think you back you in I think

Edward Doheny

have the [indiscernible] answer new if some it add we readjusting with gets the how How take about and with in the on we back because CTOXGrow, CFO on then I'll the color model. to

Unidentified Company Representative

Absolutely.

of appreciate the I couple would really A again, comments make. question. Arun, So I

As about year, growth critical. volume is we think right, next

for reason high earnings to of quite, and growth digits believe that's sides to you about we earnings. run mid- of If to it Cost mid-single-digit-ish say, volume that Take-Out top-line point, At growth. back really we low growth. of volume the will the to to to then XXXX, anticipating earnings think CTOXGrow we of both XXXX single won't Grow ahead program single-digit restoring growth back restoring kind earnings getting overall relative but the get If and part is single-digit about low growth, our talk coin, get back

as your minuses So off kind going we're and back about down is, a One point, the coming obviously we are what think of pluses year. that. to

into think of point time, putting is view year, XX% market $XXX slightly some in net and putting around price on degree, being our could what's next negative. realization pressure we what questions on I which play as this is comment about you a of pressure see the of the next coming year, develops made shift that If million the one point earlier right? at is in XX%, to That, that

from on how plus in of to of view change next or and progress that as those up volume that point plus we year. months gets Ted. really out I'll And down of you to today perform six it do shift how they and market comes again, point end the the our from that or what look view turn

Edward Doheny

we there. Yes. of this through is what have the the depth Arun, to under-promise, again, as we've just And the in and going again, CTOXGrow is the on plan. off this that put over-deliver in side, building cost theme

Our to that. plan is beat

to On the growth get got growth. side, we back to

As I low what is and going the exactly into on growth but at this 'XX, looked shared in the 'XX. end is implying 'XX you've model,

to the We two top that or and initiatives get to add what you here get back model. those on turn growth see engine of have to to to around a percent it

below is outlook do to that. we numbers for Right to now, model internally beat have are those What the the years.

-- that We with lift. going the think we us, we also, market behind will

Reinvent but growth. off time, we nicely, we've As did we've very with first the shown what we leverage leverage to got

we getting have that's and it. see And team to So quite crisis, a we forward, the beat we going on focused have our that's growth, will crisis after you going what whole and what nicely that growth we're leverage here.

Next question?

Operator

Thank you.

from next is Sachs. question from Adam Our Samuelson Goldman

Your line open. is

Adam Samuelson

you exit time might -- have parts be continuing might have business morning in that that to are here the Good doing be And functionally the Protective to that Maybe business? an replace in that of Is the of confidence higher-margin more you're happens is there and when year? Yes, some some portfolio lag terms kind business going those next of element appreciate strength discussion thank trying newer commoditized lines you. of grow that that on there your I review. with growth the and in everyone. transition shipments into and a impacting you and your cadence to those

Edward Doheny

you want Adam, go? we on does it where interesting, have the -- what pause to Product you called I strength the is If name, to what we noticed, part Yes, grow. was at actually think review portfolio, it's went an What into we're changed looking the to to what we fit and Care, of we're Protective. said

Solutions. we're Now Automated calling it Protective

Solutions our fit business, for strategy of So it customers. Digital we're on our does putting this Sustainable the lens and Automation,

pruned business. We great are So shed we doesn't have about fit but products discrete we Kevothermal. shrunk has that or being products, a like reflective what's These just discrete Automation it the business. talked curve lens into products, don't fit that in for if this

can't do with grow them. we're else those So we something looking if them, to businesses,

portfolio this right. we as continue get of other The the to strengthen Protective, the cost side

Cost So we to afford digital past, efficiently, to more Grow, we market effectively can and to And efficiently. reaching grow customer. our transformation, the more more we customers and customer, said to in go couldn't that's we how that this go where through effectively that

want these tremendous Protective haven't to with of reach of go products the the that some coming lines big portfolio, in. Solutions nimble to we product We new get and reach and get customers have more Automated we those

we business, work grow can think got we to we So do. but this some

question? Next

Operator

Thank you.

Securities. with Parkinson Our comes from Christopher question Mizuho next

Your open. line is

Unidentified Analyst

been your recently. this Can Hi, have is Chris. that It appears strategy? Automation John you current on receptive clients on deeper pretty for your dig

trending then see could provide and so just term? current touch also, been initial that's And the you your Thank more detail backlog on if growing that you. expectations? digital how and you in versus MySEE if your how could And you intermediate on and

Edward Doheny

good. Okay,

last product ship. year, of part we our the Protective and feel of first where bookings. on level we at couldn't we Automation that. question our Automation. are, the in had good about too we the look into because high talked So in We on about a actually On If lines some Food

That in significantly. part the the down. growth the year, seeing up work bookings, of we first pipeline, we've -- that was that the of half So worked

pipeline second half year, turning on of the into bookings down, the but pipeline, to the that issue that is working we're The bookings. focused we're the

work the as the their are call, demand that reduction on to where earlier harder. So we on I CapEx market, spending, actually have with challenged a customers balancing we're shared

have We can in to their show productivity. where we savings significant them help

that's second So new the us new year. right next Automated for bringing solutions, also challenge in going And into and now products. into the half

about. part, good that So we feel

help The can second you of question, if Dustin? the part me,

Dustin Semach

back MySEE and... Go through

Edward Doheny

distributors on moving and with conversions. how business is solution, that -- and in do us see where we and the online it you Protective for very quickly. largest most seeing are Again, with our help make back MySEE we're Digital easier fairly cooperatively, yes, working customers, the coming forth. Our we to we And have can that our working as interactions

entry, touch with talking communicate list customer our service, not with how our can just touch factories, lists order we in anything et operations, We're about cetera.

scalability? we're to with need that tipping see moving We we customers half the come. but Studios feel excited the part starting quickly. design use about more to over Online that still part can slowly we faster of and really our underway so with products and bringing our second is can quicker happen, to the their get That in actually So online good start MySEE point, we is that company to things help Design

I Okay. more it wrap and -- time was that have call one to Operator, for think or we time up. for

Operator

this time. I am questions showing at no further

would like I Doheny So to the turn back conference for to Ted remarks. closing

Edward Doheny

would for to I time today. thank their everyone Right. like

the very opportunities SEE, about much. again Thank excited in November. you we ahead definitely are We speaking for and to look forward

Operator

This concludes conference for today's participating. call. you Thank

disconnect. You may now

Sealed Air (SEE) 8 Aug 232023 Q2 Earnings call transcript