GEF - Earnings call transcript Q2 2024

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Operator

Good day, and thank you for standing by. Welcome to the Greif Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Bill D’Onofrio, Vice President of Investor Relations and Corporate Development. Please go ahead.

Bill D’Onofrio

day, good and you, everyone. Thank Fiscal Welcome Call. XXXX Conference Quarter to Greif's Earnings Second

During Officer, quarter Chief provide our trends. strategy the today, call current as Executive our to an business on as well by you update Ole our driven second results, Build Last with will Rosgaard,

important, Our topics Disclosure, full an we overview In year with because our Chief accordance Hilsheimer, you please results discussing financial with information an Officer, provide Larry Fair ask individual guidance. regarding questions and consider Financial Regulation from nonpublic prohibited will of our are basis. fiscal material on you

Please turn X. to Slide

During beliefs will related make could we today's events. future statements Actual results call, those involving and to from differ plans, expectations materially forward-looking discussed.

financial directly in the Ole reconciliation over non-GAAP Additionally, presentation. on measures of and comparable presentation X. metrics found be we now most will the can appendix I'll to Slide that today's to referencing the GAAP be turn certain

Ole Rosgaard

joining everyone, Hello, Bill. Thanks, and you for us. thank

to discuss for through System. are across Greif, the Greif We business execution solid another the excited by Business underpinned quarter successful

positioned for each like our into Build Last would key on continued results, near- This recently headwinds specifically I is our we and updates persistence our faced why will business creation. value to widen we long-term dive touching and Before as help on lens missions our our X to the strategy, discuss for of our despite solid Greif believe has contextualize outperformance. performance and rare well as

communities. ensure our results on will communities service-profit protect through quarter future and I pillars the the through capital creating allocation. we strength I chain. and our our how First, customers discuss service will touch then principles our and we strategic our for delivering customer financial thriving Larry legendary discuss will of how

partners, customers to product focuses now chain which do to is customer our customers, Everything reminder consider primary dedication supply company our our X. principles world. the chain, vision best-performing Slide our a to all, customers through on colleagues, be the stakeholders. service on to our in to I'll our the be these service We discuss improving As service-profit and we financial our the end of

chain service-profit a value the a colleagues creation colleagues in Score share service in legendary promote dedicated recognize engagement our to differentiated for to investing from competitive willingness power in not are has culminates increased improved passive monitor an loyalty advantage Our of created customer steadfast conviction behalf, creating service. model, for of products. our we flywheel and Due of our and and engaged our time. wallet very our the through delivers as people, value to customers Greif and simply a product standpoint. satisfaction This closely. Net a value creation providing customer on over actively Promoter Greif customers' this Customers measures

Our consistently Net each Score continued Promoter improve to with survey.

Our customers this the well behalf. XX, on most recent score our strongly which April advocate that above of our is manufacturing the average reflects of sector XX completed across

recent most likewise colleague the of top measure Gallup. in the of all conducted result improved by We through likewise survey XXth continuously engagement companies. Greif This independent among score has puts manufacturing the percentile an engagement and tier

culture. Workplace been proud Gallup Exceptional recognition have We the Award our of XXXX by to in are people-first awarded

drive are and fundamentally to Build our each a our changing our as enablers, deliver results we Business are Global demonstrate our are quarter with on performance Greif which are award These a row This follows quarter alongside how Newsweek's statistics the year the among And from us Workplaces. named meaningful in Most last Loved operate they journey. company. Last System second as we and XXX were when for Top people

suppliers. legendary improves It's over and and now of journey is customer Greif, both ingrained provide own create our systems, customers alongside our solutions and the that sustainability customers them. of in order time. continuously belief This we sustainability share relationships processes, At Slide service, loyalty our X. wallet and must our needs also culture, our and in discuss understand our protecting Let's with future to improves customer on our

us we quarter, is growth a the the enabled chain our released well creation at dedication XXXX our another value which latest profitable differentiates has XXth This time. our turn our read greif.com/sustainability. Please accelerate This flywheel progress. all future. recent targets overview Slide comprehensive over Annual of which the our way its as our in encourage sustainability bolstered transform growth to Report, has service-profit and Greif our Sustainability service-profit which and X. resulting to available and stakeholders We for to is as and milestones to provides report, through chain Sustainability portfolio

we and and in billion an Investor addressable over leader ag and global of exposed As to food are as Day, and has market pharma discussed chem. product fragrances, growth we plastic such secular since, strategy high-margin XXXX $X have high-performance, to our is often announced acquisition and This beverage, an containers markets and pursuing jerrycans. group become a favorably at flavors small

In confident addressable to and completed previously the Greif of communicated. in the is platform ability portion $X that in growing solidified March, we Integration million global to we capture our of well, synergies we that our have markets. high-performance now the are within going $X billion and doing acquisition so, committed IPACKCHEM, of into

the and As in already effect. both are of a executive synergy raw overlap, which scale of the reminder, leadership primary planned advantage elimination largely of expected material and opportunities form in

pleased We extremely underway. and investments are value creation our with

in our run rate. smaller global of for However, than revised I'll expectation the also X-month contribution previously communicated note fiscal fiscal guidance that 'XX softness the 'XX ownership given markets, recent short-term in an reflects packaging

by of onetime have in solid invested IPACKCHEM well The million Additionally, Greif organic year 'XX quarter in fundamentals fiscal the the operating the $X.X growth working reevaluation million included expense, will together conviction small as expertise impacted business our plastic colleagues results. the power days we over the markets. be long-term has the our further capital earnings in inventory combined and past a jerrycan for second XX of earnings of strengthened as expected and $X.X of which was approximately legacy

to Slide turn past of as positive demand continuation mixed the to the a sales total our same trends reminder, of months, shift was in In seen recent a QX. we gears of recent quarter the discussion as we Please In signals a is which, demand as X operating have X% company net and approximately in environment. APAC, showing quarters. X

occurred. the demand after reversed trends expectations New fell QX, Chinese a destocking in short and strong expectations for significant Year market's quick but of However,

In has the Americas, a second QX. continued end flat market, and but markets, growth row coming trends for quarter demand. have into That the broadly demand notably lower far In with with year-over-year largest GIP was persisted lubricant in of thus demand level chemical EMEA, mixed LatAm positive across in demand. Greif's

America, EMEA However, markets from North we that the are but on ag slower remains encouraged has LatAm as chem. despite growth overall improved in basis. demand mixed, sequential saw chemical likewise, same a

they demand ensure our revised weak anticipate be remains improvements as Although themselves. demand guidance. North region, changes real-time markets that to sequential we in in America is and responding in overall monitoring to continued We'll we as closely key present and well reflected end our QX in capture EMEA, LatAm opportunities chemical fully demand which as

tube American demands, box by e-commerce business, softer, by slow core improving channels, film North in which continues and bulk stronger business our offset paper our a improvements feeds sequentially although & containerboard, construction core but by into steady volumes. driven Lastly, driven

expect this improvement continue. also modest to We trend

GIP continued Southeast and saw anticipate film we showing in over sequential improvements demands. May, demand demand Asia and by opening North modest stronger EMEA, paper LatAm driven our improvement In construction by slower and APAC that in demand with with of the all URB, April, Dallas with and continuation America sheetfeeder. mixed business improvement, our led China show containerboard,

talking generally positivity. is to our when Overall, customers, there

However, of in coupled own to indicating with short continued improving this the trends. it our remains uncertainty demand resulting visibility duration to their demand, customers

that continuing walk financial cost monitoring be now that, will to signs clearly improvements. to And to closely turn end management, markets it on For results with Larry we of I you X. more are through detailed while our defined also prudent Slide over for reason, on

Lawrence Hilsheimer

Thank all and joining our for Ole, you, call. thank you

quarter million per second resulting the business, free EPS in $XX paper of adjusted million Our weak reflect extremely challenging results $XXX EBITDA, share. and and still of $X.XX but adjusted demand flow, our improving, of cash in dynamics price/cost

business, programs. foundation with and and productivity we build As creates Gemba Ole that through Using the our manage to signs cost for as are costs, customers mentioned, business diligently structural automation improvement, not help optimize synergy provides value our well leaning for Six integration continue System excellence, out as but plant Sigma and as on capture monitor and these we grow inflection. Greif our drive champions acquisitions. also accelerates to to we only through Business System modernization gains the accelerate current tools, and Greif continuous an serve Business of

the and investments critical the through the and present, us sheetfeeder. once will managing IPACKCHEM recently projects to return capital state. also These While for we position growing normalized to well for future long-term through outperformance Dallas our acquisition markets as and are strategy opened such our vision high-value are a

are our the We remainder guidance year. of fiscal reinstating the of in confidence range our our given view

low of the to to pleased and a million. end at from $XXX $XXX million are end We prior our raise million $XXX high

a Slide guidance starting performance Before provide let discussing update, on segment me assumptions, X.

$XX million led demand compression and weak decline For X.X% to GIP, margin sales but of improving year-over-year. continuing year-over-year of a

for year-over-year, up in improvement. Despite sequential strongly the X.X% line we as QX expensed, on our investments in investing of while over which from QX on call. D&A primarily acquisitions our ongoing expectations new were costs our fiscal IT strategic basis as margins and step-up a we with SG&A addition, excellence, operating This investments, margin as strategic of a result incremental long-term by In XXXX. are communicated is capital in global cost view rallied these well

yet flat as and touched seen. strong improve, Ole continued underpinned has down on, chemical to by Americas demand improvement remained lube to chemical As markets. EMEA been not The and lube

do However, anticipate sequential seen overall has North that year. improvement, we fiscal our the to second and into continue of recovery half America

OCC continued announced Slide to margin compression the a over to recognition despite results. XX increases turn significant PPS has XX% flat delayed led for Please price of with combined sales. of The rising costs

team is including manage non-index well, customers. successful continuing our implementation to controllables increase PPS based Our price on

we'll is offset. continue of and to sync view we be still the with headwind index-driven the we which impact work dynamic, However, price/cost trends not to outsized to real aggressively have market a in

On the down. while containerboard, remain and seeing side, to modest volume the core we end tube flat markets in improvement, are

within the also in as with SG&A future resulting GIP. in similar for present, to product group, invest inflation initiatives are continuing strategic discussed managing While the we this cost

to guidance and Slide XX turn Please our outlook. for updated

of the guidance By GIP. price of on in low of million providing the $XXX improvement end. margin continued assumes range million, reflecting low GIP. reflects guidance guidance margin we no high recognition as of well $XX range no As $XXX our end further contrast, recognition, paper of increase and as million OCC to range previously increases The stated, our are price slight EBITDA a end improvement paper announced our inflation, cost in an

the our across most assumes trends guidance of markets. to On million $XX our volume of change $XX and the further million contribution of volume EBITDA improving side, of products end

As purchase as accounting of from to run is Ole our slowness due agro global incremental previously year short-term mentioned contribution a $X.X IPACKCHEM than million as disclosed of rate EBITDA full well in earlier, the markets. less impact

$XX volume EBITDA anticipate as to million relative transport inflationary of and headwinds we related of guidance. to million well $XX prior manufacturing Lastly, as

well increase strategic $XX to of year. other of the of of taxes for We of as $XX cash interest, to provisions; improving efficiency-related result fiscal million in will cash failure our at $XXX to CapEx higher at leaving unchanged guidance partially our Congress anticipate of working extend maintenance not offset $XX primarily are flow, IPACKCHEM by $XX million 'XX. cash demand we cash a midpoint this drivers the full as higher related for million; our earnings; million favorable As favorable midpoint The higher EBITDA incremental midpoint, that on and guidance are, within cash flow improved as address needs of $XX million tax projects $XX million; previous spend the to in items. free of of capital higher miscellaneous related the the acquisition million,

we Ole while for remarks, As long-term we critical lens and our maintain invest business also is mentioned future. a his to continue the monitor near in it term,

Under capital Last, of fiscal Slide through Build 'XX As such, on XX. over discuss to to have like deployed $X.X we define present, we would I as which capital. billion allocations

simple. is two CapEx, our increasing our framework We nonnegotiables, capital and and Our our invest machine in maintenance cash keeps allocation which regular first running, dividend. safety and

we same shareholder that generated While of return. the not critical, devoted significant and and these increasing rest uses so in are towards growing portion time business total a frame, cash our

the balance plastics encouraged global successful growth through remarks. at above leverage his times it On has which progress leverage come leading the transactions, opportunities are as long-term our this The discussed our IPACKCHEM. substantial, X.Xx the small capitalize of realization. We developing of Xx the increase by growth integration in business platform, benefits synergy and Ole range target the are with and growth side, recent we majority reduction to of such temporarily on when ratio in is the debt our to necessary value-accretive order of in long-term long-term to execution

term, current we prioritizing leverage, our reduction. short incremental Given debt in anticipate, the

to our in confidence capital our creation upcoming we'll value have the this Day December. to and deeper deployment topic of Investor in We Last, Build at plan benefits under dive into

Slide closing for With turn that, XX. I'll Ole back to things on

Ole Rosgaard

on the creation, I communicated time strategy. our listen the drive occurring transform through to is remarks which Larry. Thank opening do taking to best, we customer each hope I I growth you that my business. value leveraging and what you, service, our of appreciate to clearly

Our are recent and initiatives capital growth setting next the wave accelerated of for the at investments Greif. stage internal

the have to chain of combined framework. Our service-profit our disciplined System capital driving success, growth dedication and allocation flywheel is and a which Greif Business to create

Greif this success. We our have December, discuss we through changes are plan making Day detail upcoming Business the organization an Investor the in breakout greater transform for currently to System to and

the you Q&A. will Operator, open please for lines

Operator

Instructions] of comes line first from question the [Operator Panjabi Ghansham with Our Baird.

Matthew Krueger

in sitting Krueger Matt is Ghansham. This for

off you really to question provide volumes. some as added quarter. across thoughts helpful wanted the a both business the how quick off on the just well. has with third fiscal on detail Can And kicked early I cadence guess would some segments during volume then I So just be on start quarter

Ole Rosgaard

you me Let give comments. some

Let end perhaps we regional me you first comments then and on and sort overview year-on-year. the I'll a some kind And go give of into substrates of zoom make markets. can out

saw if was bit EMEA, GIP down weaker little an largest and X%, look market where North APAC. also So at the strongest We growth, flat. you we we a was our LatAm in it regionally, it's XX% so and in X% market. minus were America, were

again, in second fiber, chemicals both markets was straight coatings. & In and improvement QX, in bulk the America, like And bulk had do industrial across low flat, improving mostly IBC Steel and North it's down. But other slow again up we I commodity broad by in strongest on The earlier saw we and most singles New sequentially and in And is were saw see XX% Year we substrates mentioned, down paints from ag invested softness food sequentially. Chinese I in we the of lubes. we're some but year-on-year. from and continued it's developments low our comments improving in strength and year-on-year, look chem impacted we for we have at negatively XX%. demand we we've we APAC. made quarter, but plastic, ag demand seen as And places. teens QX bev. actually in LatAm, end the and up and chemical pockets is EMEA weaker we some seasonality to substrate up chem where improvements, sequentially, from was volumes are in bulk are see If and

quickly was at bulk see which of the we and we XX positive last are We X customers, we And exiting which also above as global including our partners, we've supply makes like is strong developments. connected in will done reflected. stay positive really If the react for and hopefully look us these the is positive future. said, as chain EMEA. have end I chemicals, indicators keeps our economic And the increasing, we months, lubricants, demand seen very where signals markets for the that to May, PMI

Matthew Krueger

could be quarters, year? I just price/cost would from check a helpful. That's pricing If want as validity Great. on the the price/cost of the of follow-up. you helpful kind the like wanted quarter touch business that for detail and very that some have given we in you provide market. And the this initiatives on statement. would to well. an a upcoming that It what performed seems could view provide then expect Can absolute you expectation a to bit. across price/cost how updated reaching you the X just point I your pain peak be on

Ole Rosgaard

Yes, that's a great question.

I think answer to Larry will good be that.

Lawrence Hilsheimer

'XX, $XX GIP. squeeze Yes. million in price/cost about Look, positive I of we $XX-odd major clearly, what as impact mean, in relative to and we QX about actually XX about had at million paper year-over-year looked price/cost --

in million So PPS. $XX $XX of benefit of and in benefit volume GIP million volume

very trends show, to $XX looking about price/cost of squeeze at on from from million current And harmful guidance, business price-cost going So million. then our benefit GIP guidance volumes million that $XXX gave, of that we and our low former in actually, to us. good, end we $XX volume

Within PPS, prior I'm sorry, going $XX $XXX million of to last and in at million where at where I'm $XX business, pressure, of our year $XXX this flat. million. then to Major $XX million PPS obvious $XX price/cost OCC lift million million And clearly and from now, prior roughly year were squeeze GIP $XX million, the year price/cost million within we and are we on going the million containerboard million, of midpoint, $XXX from If numbers squeeze positive, from of positive. about URB about $X business. volume $XX -- about

Matt. what looking that's for, we're So hopefully,

Operator

of George Securities. with Our Staphos of Bank America next question the from comes line

George Staphos

now are no say, $XX would $XX roughly, pickup where Slide informed negatively, could turn Larry in have the Congratulations of the the recognizing And guarantees things move your your pickup if where terms things there at in in volume look on the your million move in life, quarter. I we waterfall. are million, wanted of more volume guidance? positively, in you that to terms to you and right improvement you Ole, go guidance, could more that XX, in to

Lawrence Hilsheimer

at smack Yes. where that. I the the George, of would in is trend we're in right middle right say, now

on, it did customers. where what some some comments, potential so a around we our optimism. there's areas still based as in there's And seeing also But of nervousness range in is build some his we're mentioned Ole there's

we the So we've what rest was around range a the of possible for built year. thought

George Staphos

both, quick or market terms at by early Larry volume? and you Ole, us if trends XQ year-on-year kind you are on where could, probably a give missed in maybe fiscal but seeing of I this, you end substrate, by just either you're of could the in moment

Ole Rosgaard

You the May? mean at of end

George Staphos

Yes.

Ole Rosgaard

improve to the May So and in But Plastic EMEA, continued they and mixed exit also I to containerboard in by a quarter. and on trends a more improving improving, URB, in at look demand we George. GIP in despite May generally strong, will see sheet if markets. but containerboard, URB Steel and the from bit demand then start and being sequentially North remain way film they kept is continue soon that's our basis America And were positive, was sold. during a LatAm we QX. and throughout Dallas construction the and with increasing which mentioned, operational sheetfeeder, mixed our producing end benefiting month-to-month as is all

George Staphos

Okay. My over. last I'll it two, and turn

Sequentially, sounded sell containerboard could, give color up still was you Ole, right, all in modestly if getting URB us not better, terms Just bit and was, tube core said gangbusters, of or year-on-year a like It in remind us you paper. down. year-on-year. but more what but

kind rest and of there. price/cost then May have If in of you of the discuss seeing out early expect steel Do affirm you're sequentially the and benefits year? sort of improving we decelerating or you particular what there? should what GIP in And could that

Ole Rosgaard

Yes.

way that so little I'll as will is upon segment what well bit internally, improving, steel, as a I on end mentioned, keep positive tube are construction, So paper maybe generally and later our and biggest on In costs. which core, costs as we're film by doing that the touch self-help.

hopefully, haven't doing we there. are We we're companies costs, we'll there in haven't pickup seen a But yet. we to seen any really see that Whilst selling and major other also recovery soon. well paper paper

Operator

question Truist from Mike comes line the next with Roxland Our of Securities.

Michael Roxland

just I XX. question First on had Slide

if $XX and Larry, think, there I mentioned million I that's that? of to the headwinds, million you $XX heard driving new. What's manufacturing you correctly,

Lawrence Hilsheimer

The predominant of that driver volume. is

costs pick-up, volume you bit get incremental So then additional a with volume-driven. just costs and more transport of manufacturing little

Michael Roxland

certainly, you. that leverage pent-up you're about operating then business seeing once early could just volumes potentially released be say, impact cylinders, talk so be on leverage And could Got in depending you global to the can released Once the operating pent-up start all Perfect. also this maybe And the positively in let's the stages, region, that what's and everything, is volume improvement. firing and business? we're normalize?

Lawrence Hilsheimer

$XXX we up in up incremental million be as doesn't on predominant that the is in as And factor even run volume to if to picks need volume. of look on up, back, about But be add all pickup on getting we going if and EBITDA. to get to rate where this back to from picking your XX%. costs. value EBITDA margin XX% getting just material Basically, excess we occurring our on price volume end paper. the going return acquisitions I'd you just full costs incremental to But about assume And a are of say raw cost up of would transport generally, levels, addition gross 'XX end

path returning economic a see we million $XXX conditions of with well to EBITDA. So over back

Ole Rosgaard

right and also business just systems. me touch cost our internal on Let our impact initiatives the of savings on

high operating across we gains looking of locations. So our we're for at internally and XXX we're aggregation always call a level, what marginal

They also X%. Our estimated a savings cost for run indirect example, in targeted an America, of in estimated global which spend, sourcing review resulted a North an finalized review did particular recent certain team, area total a reduced in material as area, this of by rate which X%. spend recently an

expectations. reviews, example, We which also to our operational steel two underperforming plant an conducted, excellence as these plans full-scope previously recently were

significant Sigma raw increase And stream material margin usage I focusing and on plants a sustained they EBITDA mapping XXX reducing these recently a now that plant of two Six years, have past plant plant, performance. is by and it with profitability seen the include improvement each tier. performance a Gallup you look when Lean few of extremely and their scrap, their top well and a correlates relative on and NPS visited who trend made these scores. to for have, bps And their approximately value reviews, these prior the things, review, over full at

So the are of structural our gains, big margin part of application types these they marginal a improved profiles. of

truly are P&O, playing in we I should to which and you on as the and mention entire automation So and can excellence reflected commercial is sourcing, earnings. also hear, chain our spanning operational initiatives from efforts, our supply

Michael Roxland

And mean, then like of I plant profitability much improving subject of could do runway level those in you quick your many to that? one more have types further reviews? be terms follow-up. facilities how How of

Ole Rosgaard

of honest deployed there you must Yes. size Sigma program, belts, participants there. and saving and see, I things but see It's Sigma really a me, just have magnitude of and certain driving give The they we plants. yellow Gemba I you, okay, projects have them, XXX all the globe. Today, belts, mentioned our some bottom of green you and amazing. a idea the line across XXX To we of find we thought, when black And program. to belts. limit to surprises Six have sort the have with I just Six be nearly keep have at this of in white belts, I hey, things look be somewhere, XXX and -- a I that an we we XXX previously, savings we we a have surprised XXX the getting XX And have

you when you and call say, why but gains, aggregation of can time. and initiatives. numbers it you big add and And over these on you're looking it years at becomes there, that's here of like runway find we $XXX,XXX And okay, $XXX,XXX years up, marginal it

Operator

Our of Brian the Butler Stifel. with comes next from question line

Brian Butler

just I of there million what hoping million? you about and volume, we talked kind to maybe get high that components else about the getting talk walk if You the are $XXX price/cost, through was EBITDA. it, from just could maybe anything there's and those $XXX the level,

Lawrence Hilsheimer

The driver alone single 'XX. largest at million to current just volume that rates. getting that back And margin a levels of of component $XXX is is

So volumes off, and bit but we look recovery obviously, on data at else. are evidenced and good still look sequentially, statistics the significantly economic X-year stack, in volume a you everything with little that's PMI

volume for level drives lift of back us. earnings a huge amount So getting of kind to that

so areas Ole as to more and operational so all mentioned, tweak other cost undertake that costs. And change that can our even improvement these structural we really inflationary we drivers, cover

The evidenced the our containerboard paper pickup acquisitions run secondary And well. drive business. then those the well getting big a needed, we and and and as level on performance getting full in we've business then price/cost what back our new element done, is just rate back also increases this Dallas consider sheetfeeder business to things much deserved can as by clearly recently price we announced, and

all those together, over million put figure. you that it easily $XXX drives elements You and

Brian Butler

X you mix? some Is the And the recent How mentioned price $XX. end $XX the much to Okay. URB in or end increases? and kind high of XXX%, that other the is of low

Lawrence Hilsheimer

get should we've this of we'd correctly love recognition increases. but costs substantial the our inflationary production expect paper price full earn are Look, we and needed and They in returns we But we The of deserving. of all grades yes, obviously that on is a appropriate very these capital. to result, data-driven burdened need RISI. system really to to pragmatic we by relevant, survey Plus a still true we as become to the system the market, also move we're automated and report upside. utilized them hedge again, remain archaic look, by had

have system, recognition. upside, time with the And deal to any RISI recognize. our have guidance put would in range our we've I to issues mean, we timing no related a they and also

P&L would medium and benefiting late at It effective timely, then start to July. gets June URB the through So and XX. $XX to That's in you July recognized September. this in we the late $XX If have the linerboard that X. month. start we'd look August in that recognized And $XX come $XX effective

got we immediately it So out, there's everything more when upside. some even that If play there'd then be upside. we roll in

Brian Butler

you're about in when if would the think like capture? of midpoint was kind assuming that the what to that of And you incremental of 'XX you be what's perspective the EBITDA benefit there, rollover, a able

Lawrence Hilsheimer

Yes.

$X you $XX in so say annually. is $XXX,XXX containerboard impact $X.X If month a pricing on $X our I'd million million is just roughly general, look at month, annually, to and a URB a million

So the that back give into numbers would whatever be. should your you to assumptions

Brian Butler

a capital Or break guidance. And there that one, million one out, initiatives that increased other little you're That is all that Okay. on updated the expenditures. last are Maybe kind of then on $XX spending growth maybe bit on? that the IPACKCHEM?

Lawrence Hilsheimer

all. at growth that on slightly operational. as at project million inflationary EBITDA Dallas full over, What $X going some sheetfeeder is, really when costs up IPACKCHEM generate little blown ran is to that the strategic but it that about you a Very had fully of a month

some in and well some projects we estimation. to need So maintenance more engineering our frankly, high then the cash money thing. forward. really the think there's forward. said, And spent didn't look, safety had pull and kind and we hey, were that we spending of move our available, came cash take it said, producing that group we not capital since of risk And And should to we we of want on us

Brian Butler

Okay. Nice quarter.

Operator

comes question Our line Wells Gabe Instructions] next Fargo. [Operator of with from the Hajde

Gabe Hajde

I a a that are flowing Just out million called it's you as Larry. Was that backed know Or housekeeping $X.X timer? that on through? noncash. question one you out, the

Lawrence Hilsheimer

Yes, through. I it's we accounting. mean, flow it

to we We finished any have basically goods acquire. sales price inventory mark to

have been IPACKCHEM but gone with it, forward for So profit, not. it us, it's had would

thing. So that's a No. X-year

Gabe Hajde

guys but side, production Asia when appetite question serves obviously, don't Okay. capital or about about and is the think, about on like again, look you know, robust. have, grow Southeast X or over doing maybe just more about, there. guys are then all you I But curious prevent there being to Southeast from I And talk others you're a GIP it there. different these plants mindset, If in I fairly know just some Asia And I a to remaining I we than wanted things, you activity deploying limiting at, ask specifically. maybe I China it's that. in guess, what memory and EV Can general. that you more know, selective customers factors seems returns-oriented over

Ole Rosgaard

safety all, a earlier, say somebody the comes deploy is which we growth as and request then and other machine, cash. cash maintain mentioned for we approach after our very of to looking then assets, our we with first CapEx, start that, And do disciplined have we when no. steel that, have and them, then And then network we way we have never dividends. at CapEx. Larry we need and Yes, And we to

that's We aspect I have payback country the at filters the the say, review apply not terms in, is geopolitical we And such then of come so of requests all periodic and that as But geopolitical it. also look priority highest a of of we China the on. and ROI and would aspects. in

So if there likely is it do elsewhere. we would a choice,

just amiss built say have to and in I Malaysia. for that would some IBC we've in China. plant be safety, maintenance, a new We invested upgrades But in automation

So are of region in it's APAC. surrounding we more investing the terms

Lawrence Hilsheimer

The of Gabe, China. we factors. thing does I some of as Yes. we Whenever our assess part kind projects, geopolitical operations risk IPACK Ole any is add, always in have mentioned, would have, as

mechanically capital what investing in some is hurdle does process? the place our that like rate It much means mean higher. us for in that decisioning Now

wrong, what look anything with would as something at happens have best that plan? your we part at as the of we program, you other then the things, if So aren’t if we our And And did of evolve goes is it it so hurdle what's rate, IPACKCHEM, getting thing we as deal kind done. and management to risk can't be look those to. enterprise able meet could in this we plans next

Gabe Hajde

Appreciate that. last One one.

Ole Rosgaard

on comment that. last one Just

in across we bear operate So countries in globe. XX the mind,

So we've done that for decades.

promoted APAC, growth So a on we that. always focus are that Leahy Matt since that to region, of region. geopolitical talking we really what already the as happens lead stage that. result, is our do been but has do in And have system, and on we to actually disciplined operating place in part he's plans about And

Gabe Hajde

IBC about backdrop talk hasn't deployment guys you recently. appreciate, the I heard haven't obviously, supported I here manufacturing that.

if infrastructure. out CapEx that have the little guys side, Just a flip in of maybe that's curious and/or, of built a you bit tick-up on part

the customers pretty understand on does, those lines that to demand your you're but I service when think inflect? IBC I fact, positioned well, side in

Ole Rosgaard

network, And acquisition, facilities. in additional continued lines of organic. throughout will many these also IBC our this opened a in through to new open year our existing primarily expand year, formally molds deployed I September, we IBC plant lines and not Turkey, year. in and new put we have but mean, We've and plant on IBC new in we blow we've last that said I Malaysia. Last

it's of So part grow, strategy, continued it's this high is also and we've it's area because where margin. M&A our resin-based, an to

and they on tend a market and they could to our as request that when it's for come And in. ask So them provide certain customers well very expand, we service grow if to we us do attractive the locations. that

Lawrence Hilsheimer

opportunities but this, IBC we of we year those world. continue just Centurion we of have everybody, many geographies. small, And our around And relatively you'll to to ownership in Yes. remember are fill last recyclers And Most other but to footprint. the they with remind increased significantly. explore Gabe, dialogues them out equity our continue around

Operator

I will comments. to for microphone Rosgaard hand closing now Ole the over

Ole Rosgaard

and leverage questions before team all Business you. want our for for just during and you've I we call, fullest, temporary utilizing Thank Greif you global this of thank proud to operating your environment. Yes, Greif significant demand as We're Greif. interest the the the in continued creating its to sluggish very heard, System end

colleagues, with to and our realize and to Build Last you provide the loyalty We with we and business for outperformance and our continue Thank your legendary dedication, we commitment Have which service, for you customer excited a the stakeholders to are day. to through excellence execute customers capture Greif. to have are all equally the we'll positioned of known. to great

Operator

This concludes Thank today's for you call. conference participation. your

may You disconnect. now

Greif (GEF) 6 Jun 242024 Q2 Earnings call transcript