|
|
(State or Other Jurisdiction of Incorporation)
|
(I.R.S. Employer Identification No.)
|
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Title of each class
|
Trading
Symbol(s)
|
Name of each exchange on which registered
|
||
Exhibit
Number |
|
Description
|
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document)
|
BERRY GLOBAL GROUP, INC.
(Registrant)
|
|||
Dated: August 2, 2024
|
By:
|
/s/ Jason K. Greene |
|
Name: Jason K. Greene |
|||
Title: Executive Vice President,
Chief Legal Officer and Secretary
|
|||
•
|
GAAP: Net sales of $3.2 billion; Operating income of $303 million; Earnings per share of $1.65
|
•
|
Non-GAAP: Operating EBITDA of $546 million; Adjusted earnings per share of $2.18 (up 16% vs PY)
|
•
|
Third quarter volume and earning results in-line with expectations; +2% organic volume growth
|
•
|
Continued progress in portfolio optimization; HHNF spin/merger on track
|
•
|
Fiscal 2024 outlook: Adjusted EPS of $7.60 and free cash flow of $800-$900 million
|
Kevin Kwilinski, Berry’s CEO said, “Our strong financial results in the quarter were consistent with our expectations and our teams executed very
well. Notably, we achieved a 2% increase in overall organic volumes, with each four operating segments delivering low-single digit volume growth. At the same time, we delivered a solid increase in our operating EBITDA margins, which were
110 basis points higher than the previous year. We place a high value on honoring our commitments and excellence in execution. This quarter, I’d like to emphasize our team’s outstanding performance in achieving volume and earnings growth,
as well as our progression in reducing our leverage and optimizing our portfolio.
We are confident in the strength of our underlying businesses, our customer value proposition, and our execution capabilities. We expect business
momentum to continue as we demonstrated in the June quarter, including delivering, low-single digit volume growth in the fiscal fourth quarter and exiting fiscal 2024 at or below our 3.5x leverage target.
I am excited by the attainable growth and operational excellence opportunities ahead. We’re focusing on three key efforts: optimizing our
portfolio to accelerate growth and deleveraging, implementing our lean transformation, and driving growth by enhancing our commercial excellence.”
|
|
June Quarter
|
Reported
|
|||||||||||||||
GAAP results
|
2024
|
2023
|
%
|
|||||||||||||
Net sales
|
$
|
3,161
|
$
|
3,229
|
(2
|
%)
|
||||||||||
Operating income
|
303
|
267
|
13
|
%
|
||||||||||||
EPS (diluted)
|
1.65
|
1.18
|
40
|
%
|
Adj. non-GAAP results
|
Comparable
%
|
|||||||||||||||
Operating EBITDA
|
$
|
546
|
$
|
522
|
5
|
%
|
6
|
%
|
||||||||
Adjusted EPS (diluted)
|
2.18
|
1.90
|
15
|
%
|
16
|
%
|
(1)
|
Adjusted non-GAAP results exclude items not considered to be ongoing operations. In addition, comparable change
% excludes the impacts of foreign currency, acquisitions, and recent divestitures. Further details related to non-GAAP measures and reconciliations can be found under our “Non-GAAP Financial Measures and Estimates” section and in
reconciliation tables in this release. In millions of USD, except per share data.
|
•
|
Adjusted earnings per share of $7.60
|
•
|
Cash flow from operations of $1.4-$1.5 billion; free cash flow of $800-$900 million
|
•
|
Committed to being 3.5x leverage or lower and within our long-term targeted range
|
Quarterly Period Ended
|
Three Quarterly Periods Ended
|
|||||||||||||||
June 29, 2024
|
July 1, 2023
|
June 29, 2024
|
July 1, 2023
|
|||||||||||||
Net sales
|
$
|
3,161
|
$
|
3,229
|
$
|
9,090
|
$
|
9,577
|
||||||||
Costs and expenses:
|
||||||||||||||||
Cost of goods sold
|
2,560
|
2,649
|
7,448
|
7,873
|
||||||||||||
Selling, general and administrative
|
216
|
215
|
664
|
671
|
||||||||||||
Amortization of intangibles
|
58
|
61
|
177
|
181
|
||||||||||||
Restructuring and transaction activities
|
24
|
37
|
133
|
74
|
||||||||||||
Operating income
|
303
|
267
|
668
|
778
|
||||||||||||
Other expense (income)
|
(5
|
)
|
11
|
8
|
13
|
|||||||||||
Interest expense, net
|
77
|
78
|
225
|
228
|
||||||||||||
Income before income taxes
|
231
|
178
|
435
|
537
|
||||||||||||
Income tax expense
|
38
|
35
|
67
|
114
|
||||||||||||
Net income
|
$
|
193
|
$
|
143
|
$
|
368
|
$
|
423
|
||||||||
Basic net income per share
|
$
|
1.69
|
$
|
1.20
|
$
|
3.19
|
$
|
3.50
|
||||||||
Diluted net income per share
|
1.65
|
1.18
|
3.11
|
3.47
|
||||||||||||
Outstanding weighted average shares (in millions)
|
||||||||||||||||
Basic
|
114.5
|
118.7
|
115.2
|
121.0
|
||||||||||||
Diluted
|
116.7
|
121.1
|
118.2
|
121.9
|
||||||||||||
(in millions of USD)
|
June 29, 2024
|
September 30, 2023
|
||||||
Cash and cash equivalents
|
$
|
509
|
$
|
1,203
|
||||
Accounts receivable
|
1,630
|
1,568
|
||||||
Inventories
|
1,679
|
1,557
|
||||||
Other current assets
|
318
|
205
|
||||||
Property, plant, and equipment
|
4,558
|
4,576
|
||||||
Goodwill, intangible assets, and other long-term assets
|
7,294
|
7,478
|
||||||
Total assets
|
$
|
15,988
|
$
|
16,587
|
||||
Current liabilities, excluding current debt
|
2,245
|
2,703
|
||||||
Current and long-term debt
|
8,699
|
8,980
|
||||||
Other long-term liabilities
|
1,673
|
1,688
|
||||||
Stockholders’ equity
|
3,371
|
3,216
|
||||||
Total liabilities and stockholders' equity
|
$
|
15,988
|
$
|
16,587
|
||||
Three Quarterly Periods Ended
|
||||||||
(in millions of USD)
|
June 29, 2024
|
July 1, 2023
|
||||||
Cash flows from operating activities:
|
||||||||
Net income
|
$
|
368
|
$
|
423
|
||||
Depreciation
|
463
|
425
|
||||||
Amortization of intangibles
|
177
|
181
|
||||||
Non-cash interest, net
|
(61
|
)
|
(45
|
)
|
||||
Settlement of derivatives
|
27
|
36
|
||||||
Deferred income tax
|
(78
|
)
|
(94
|
)
|
||||
Share-based compensation expense
|
38
|
36
|
||||||
Loss on divestitures
|
57
|
-
|
||||||
Other non-cash operating activities, net
|
14
|
18
|
||||||
Changes in working capital
|
(708
|
)
|
(490
|
)
|
||||
Net cash from operating activities
|
297
|
490
|
||||||
Cash flows from investing activities:
|
||||||||
Additions to property, plant, and equipment, net
|
(473
|
)
|
(560
|
)
|
||||
Divestitures, acquisitions and other activities
|
(21
|
)
|
(88
|
)
|
||||
Net cash from investing activities
|
(494
|
)
|
(648
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Repayments on long-term borrowings
|
(3,441
|
)
|
(687
|
)
|
||||
Proceeds from long-term borrowings
|
3,150
|
500
|
||||||
Repurchase of common stock
|
(117
|
)
|
(415
|
)
|
||||
Proceeds from issuance of common stock
|
33
|
26
|
||||||
Dividends paid
|
(104
|
)
|
(97
|
)
|
||||
Other, net
|
(22
|
)
|
7
|
|||||
Net cash from financing activities
|
(501
|
)
|
(666
|
)
|
||||
Effect of currency translation on cash
|
4
|
47
|
||||||
Net change in cash and cash equivalents
|
(694
|
)
|
(777
|
)
|
||||
Cash and cash equivalents at beginning of period
|
1,203
|
1,410
|
||||||
Cash and cash equivalents at end of period
|
$
|
509
|
$
|
633
|
||||
Non-U.S. GAAP Free Cash Flow:
|
||||||||
Cash flow from operating activities
|
$
|
297
|
$
|
490
|
||||
Additions to property, plant, and equipment (net)
|
(473
|
)
|
(560
|
)
|
||||
Non-U.S. GAAP Free Cash Flow
|
$
|
(176
|
)
|
$
|
(70
|
)
|
Quarterly Period Ended June 29, 2024
|
||||||||||||||||||||
(in millions of USD)
|
Consumer Packaging - International
|
Consumer Packaging- North America
|
Health, Hygiene & Specialties
|
Flexibles
|
Total
|
|||||||||||||||
Net sales
|
$
|
959
|
$
|
831
|
$
|
647
|
$
|
724
|
$
|
3,161
|
||||||||||
Operating income
|
$
|
79
|
$
|
103
|
$
|
34
|
$
|
87
|
$
|
303
|
||||||||||
Depreciation and amortization
|
79
|
57
|
45
|
32
|
213
|
|||||||||||||||
Restructuring and transaction activities
|
11
|
6
|
5
|
2
|
24
|
|||||||||||||||
Other non-cash charges
|
2
|
2
|
1
|
1
|
6
|
|||||||||||||||
Operating EBITDA
|
$
|
171
|
$
|
168
|
$
|
85
|
$
|
122
|
$
|
546
|
||||||||||
Quarterly Period Ended July 1, 2023
|
||||||||||||||||||||
Reported net sales
|
$
|
1,036
|
$
|
798
|
$
|
657
|
$
|
738
|
$
|
3,229
|
||||||||||
Foreign currency, acquisitions & divestitures
|
(26
|
)
|
5
|
(6
|
)
|
(1
|
)
|
(28
|
)
|
|||||||||||
Comparable net sales (1)
|
$
|
1,010
|
$
|
803
|
$
|
651
|
$
|
737
|
$
|
3,201
|
||||||||||
Operating income
|
$
|
68
|
$
|
89
|
$
|
22
|
$
|
88
|
$
|
267
|
||||||||||
Depreciation and amortization
|
79
|
54
|
45
|
29
|
207
|
|||||||||||||||
Restructuring and transaction activities
|
17
|
6
|
12
|
2
|
37
|
|||||||||||||||
Other non-cash charges
|
6
|
2
|
2
|
1
|
11
|
|||||||||||||||
Foreign currency, acquisitions & divestitures
|
(7
|
)
|
2
|
-
|
-
|
(5
|
)
|
|||||||||||||
Comparable operating EBITDA (1)
|
$
|
163
|
$
|
153
|
$
|
81
|
$
|
120
|
$
|
517
|
||||||||||
(1)
|
The prior year comparable basis change excludes the impacts of foreign currency, acquisitions, and divestitures. Further details
related to non-GAAP measures and reconciliations can be found under our “Non-GAAP Financial Measures and Estimates” section or in reconciliation tables in this release.
|
Quarterly Period Ended
|
Three Quarterly Periods Ended
|
|||||||||||||||
June 29, 2024
|
July 1, 2023
|
June 29, 2024
|
July 1, 2023
|
|||||||||||||
Net income
|
$
|
193
|
$
|
143
|
$
|
368
|
$
|
423
|
||||||||
Add: other expense
|
(5
|
)
|
11
|
8
|
13
|
|||||||||||
Add: interest expense
|
77
|
78
|
225
|
228
|
||||||||||||
Add: income tax expense
|
38
|
35
|
67
|
114
|
||||||||||||
Operating income
|
$
|
303
|
$
|
267
|
$
|
668
|
$
|
778
|
||||||||
Add: restructuring and transaction activities
|
24
|
37
|
133
|
74
|
||||||||||||
Add: Impact of hyperinflation
|
—
|
—
|
15
|
—
|
||||||||||||
Add: other non-cash charges (1)
|
6
|
11
|
42
|
48
|
||||||||||||
Adjusted operating income (3)
|
$
|
333
|
$
|
315
|
$
|
858
|
$
|
900
|
||||||||
Add: depreciation
|
154
|
146
|
463
|
425
|
||||||||||||
Add: amortization of intangibles
|
59
|
61
|
178
|
181
|
||||||||||||
Operating EBITDA (3)
|
$
|
546
|
$
|
522
|
$
|
1,499
|
$
|
1,506
|
||||||||
Net income per diluted share
|
$
|
1.65
|
$
|
1.18
|
$
|
3.11
|
$
|
3.47
|
||||||||
Other expense, net
|
(0.04
|
)
|
0.09
|
0.07
|
0.11
|
|||||||||||
Restructuring and transaction activities
|
0.21
|
0.31
|
1.13
|
0.61
|
||||||||||||
Impact of hyperinflation
|
—
|
—
|
0.13
|
—
|
||||||||||||
Amortization of intangibles from acquisitions (2)
|
0.50
|
0.50
|
1.50
|
1.48
|
||||||||||||
Income tax impact on items above
|
(0.14
|
)
|
(0.18
|
)
|
(0.59
|
)
|
(0.44
|
)
|
||||||||
Foreign currency, acquisitions, and divestitures
|
(0.02
|
)
|
0.04
|
|||||||||||||
Adjusted net income per diluted share (3)
|
$
|
2.18
|
$
|
1.88
|
$
|
5.35
|
$
|
5.27
|
||||||||
Estimated Fiscal 2024
|
||||||||||||||||
Cash flow from operating activities
|
$
|
1,400-$1,500
|
||||||||||||||
Net additions to property, plant, and equipment
|
(600
|
|||||||||||||||
Free cash flow (3)
|
$
|
800-$900
|
(1)
|
Other non-cash charges are primarily stock compensation expense
|
(2)
|
Amortization of intangibles from acquisition are added back to better align our calculation of adjusted EPS with peers.
|
(3)
|
Supplemental financial measures that are not required by, or presented in accordance with, accounting principles generally accepted
in the United States (“GAAP”). These non-GAAP financial measures should not be considered as alternatives to operating or net income or cash flows from operating activities, in each case determined in accordance with GAAP. Organic sales
growth and comparable basis measures exclude the impact of currency translation effects and acquisitions. These non-GAAP financial measures may be calculated differently by other companies, including other companies in our industry,
limiting their usefulness as comparative measures. Berry’s management believes that adjusted net income and other non-GAAP financial measures are useful to our investors because they allow for a better period-over-period comparison of
operating results by removing the impact of items that, in management’s view, do not reflect our core operating performance.
|