Graphic Packaging Holding Co has reported net income for second quarter 2022 of $66m (Q2 21: $38m). Net Sales increased 36% to $2,358m in the period (Q2 21: $1,737m). The $621m increase was driven by $278m of pricing and $379m of improved volume/mix related to organic growth from conversions to fiber-based packaging solutions and acquisitions. Net sales were unfavorably impacted by $36m of foreign exchange.EBITDA for the second quarter of 2022 was $294m, (Q2 21: $214m).
The second quarters of 2022 and 2021 were negatively impacted by a net $102m and a net $38m of special charges, respectively. Special charges in the second quarter of 2022 included a $92m expense associated with the write down of two folding carton plants in Russia now classified as held for sale. The second quarters of 2022 and 2021 were impacted by $17m and $11m of amortization related to purchased intangibles, respectively.
Michael Doss, President and CEO, said, “Our growing pipeline of innovative, fiber-based consumer packaging solutions is meeting demand for more sustainable packaging and driving organic growth globally in our business. This continued in the second quarter, with Net Organic Sales up 3%, matching our first quarter growth rate and exceeding our targeted range. This growth is indicative of the ongoing transition of our customers to more recyclable and circular fiber-based packaging solutions. Our integrated business model and global scale have been essential to procuring raw materials in today’s challenging supply chain environment and ensuring supply to our customers. Furthermore, the strategic investments we have completed uniquely position us to expand in new market segments and deliver industry-leading quality at the lowest cost to produce, all while advancing our leadership in the industry.”
Doss added, “The operating leverage we have driven in our financial model remains on full display this year. We are on track to deliver our recently enhanced and stronger Vision 2025 goals by meeting or exceeding 2022 milestones. We continue to execute multiple pricing and productivity initiatives focused on improving profit margins and capturing returns on strategic investments. Our upwardly revised Adjusted EBITDA range, with $1.55 billion at the midpoint, reflects a substantial step up of approximately $500 million of incremental EBITDA when compared to 2021. As committed, we are utilizing cash flow to reduce debt and continue to expect year-end leverage to be in the 3.0 to 3.5x range.”