DELAWARE, Ohio (August 26, 2020) – Greif, Inc. (NYSE: GEF, GEF.B), a global leader in industrial packaging products and services, today announced third quarter 2020 results. The Company also reintroduced guidance for the fiscal year ending October 31, 2020.
Third Quarter Highlights include (all results compared to the third quarter of 2019 unless otherwise noted):
- Net income of $20.7 million or $0.35 per diluted Class A share decreased compared to net income of $62.7 million or $1.06 per diluted Class A share. Net income, excluding the impact of adjustments(1), of $50.1 million or $0.85 per diluted Class A share decreased compared to net income, excluding the impact of adjustments, of $74.7 million or $1.26 per diluted Class A share. Adjusted EBITDA(2) decreased by $44.4 million to $159.4 million.
- Net cash provided by operating activities decreased by $6.5 million to $135.0 million. Adjusted free cash flow(3) decreased by $0.5 million to $106.6 million.
- Total debt decreased by $240.9 million to $2,637.6 million. Net debt(4) decreased by $263.6 million to $2,539.1 million and decreased $70.8 million sequentially from the second quarter of 2020.
Pete Watson, Greif’s President and Chief Executive Officer, commented:
“Our global Greif team executed well during the fiscal third quarter in the face of a challenging operating environment. Financial results were weaker as expected, dragged down by soft industrial conditions around much of our global portfolio and by a significant price/cost squeeze in our paper business. Despite these external challenges to profit, we generated free cash flow essentially flat to the prior year and paid down debt through stronger operating discipline and better working capital performance. Given our strong execution driving cost reduction and operating efficiencies, combined with increased near term visibility of the COVID-19 pandemic volume impacts to the remainder of the fiscal year, we are reintroducing financial guidance ranges.”
(1) Adjustments that are excluded from net income before adjustments and from earnings per diluted Class A share before
adjustments are gain or loss on disposal of properties, plants, equipment and business, net, restructuring charges,
acquisition and integration related costs, non-cash asset impairment charges, incremental COVID-19 costs, net, debt
extinguishment charges, non-cash pension settlement income and tax net expense (benefit) resulting from the Tax
Cuts and Jobs Act (“Tax Reform Act”).
(2) Adjusted EBITDA is defined as net income, plus interest expense, net, plus debt extinguishment charges, plus income
tax expense, plus depreciation, depletion and amortization expense, plus restructuring charges, plus acquisition and
integration related costs, plus non-cash asset impairment charges, plus incremental COVID-19 costs, net, plus non-cash
pension settlement (income) charges, less (gain) loss on disposal of properties, plants, equipment and businesses, net.
(3) Adjusted free cash flow is defined as net cash provided by (used in) operating activities, less cash paid for purchases of
properties, plants and equipment, plus cash paid for acquisition and integration related costs, plus cash paid for debt issuance
costs, plus cash paid for incremental COVID-19 costs, net, plus cash paid for acquisition and integration related Enterprise
Resource Planning (ERP) systems.
(4) Net debt is defined as total debt less cash and cash equivalents.
Note: A reconciliation of the differences between all non-GAAP financial measures used in this release with the most directly comparable GAAP financial measures is
included in the financial schedules that are a part of this release. These non-GAAP financial measures are intended to supplement and should be read together with
our financial results. They should not be considered an alternative or substitute for, and should not be considered superior to, our reported financial results. Accordingly,
users of this financial information should not place undue reliance on these non-GAAP financial measures.
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