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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Graphic Packaging Holding Company | NYSE:GPK | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.19 | 0.74% | 26.04 | 26.4225 | 25.80 | 25.87 | 4,578,987 | 21:00:04 |
|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|
Delaware
|
26-0405422
|
(State or other jurisdiction of
|
(I.R.S. employer
|
incorporation or organization)
|
identification no.)
|
|
|
1500 Riveredge Parkway, Suite 100
|
|
Atlanta, Georgia
|
30328
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer
þ
|
Accelerated filer
o
|
Smaller reporting company
o
|
|||
|
|
||||
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
Emerging growth company
o
|
|
EX-31.1
|
|
EX-31.2
|
|
EX-32.1
|
|
EX-32.2
|
|
XBRL Content
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions, except per share amounts
|
2018
|
|
2017
|
||||
Net Sales
|
$
|
1,476.0
|
|
|
$
|
1,061.5
|
|
Cost of Sales
|
1,253.5
|
|
|
889.6
|
|
||
Selling, General and Administrative
|
121.3
|
|
|
91.9
|
|
||
Other Expense (Income), Net
|
0.9
|
|
|
(0.2
|
)
|
||
Business Combinations and Shutdown and Other Special Charges, Net
|
26.3
|
|
|
8.6
|
|
||
Income from Operations
|
74.0
|
|
|
71.6
|
|
||
Nonoperating Pension and Postretirement Benefit Income
|
4.2
|
|
|
3.9
|
|
||
Interest Expense, Net
|
(28.8
|
)
|
|
(21.3
|
)
|
||
Loss on Modification or Extinguishment of Debt
|
(1.9
|
)
|
|
—
|
|
||
Income before Income Taxes and Equity Income of Unconsolidated Entity
|
47.5
|
|
|
54.2
|
|
||
Income Tax Expense
|
(5.1
|
)
|
|
(17.6
|
)
|
||
Income before Equity Income of Unconsolidated Entity
|
42.4
|
|
|
36.6
|
|
||
Equity Income of Unconsolidated Entity
|
0.3
|
|
|
0.4
|
|
||
Net Income
|
42.7
|
|
|
37.0
|
|
||
Net Income Attributable to Noncontrolling Interest
|
(12.8
|
)
|
|
—
|
|
||
Net Income Attributable to Graphic Packaging Holding Company
|
$
|
29.9
|
|
|
$
|
37.0
|
|
|
|
|
|
||||
Net Income Per Share Attributable to Graphic Packaging Holding Company — Basic
|
$
|
0.10
|
|
|
$
|
0.12
|
|
Net Income Per Share Attributable to Graphic Packaging Holding Company — Diluted
|
$
|
0.10
|
|
|
$
|
0.12
|
|
Cash Dividends Declared Per Share
|
$
|
0.075
|
|
|
$
|
0.075
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|||||||||||||
|
March 31,
|
|
March 31,
|
|||||||||||||
In millions
|
2018
|
|
2017
|
|||||||||||||
|
Graphic Packaging Holding Company
|
Noncontrolling Interest
|
Redeemable Noncontrolling Interest
|
Total
|
|
Graphic Packaging Holding Company
|
||||||||||
Net Income
|
$
|
29.9
|
|
$
|
9.9
|
|
$
|
2.9
|
|
$
|
42.7
|
|
|
$
|
37.0
|
|
Other Comprehensive (Loss) Income, Net of Tax:
|
|
|
|
|
|
|
||||||||||
Derivative Instruments
|
(0.6
|
)
|
(0.2
|
)
|
—
|
|
(0.8
|
)
|
|
(1.9
|
)
|
|||||
Pension and Postretirement Benefit Plans
|
0.5
|
|
0.1
|
|
0.1
|
|
0.7
|
|
|
0.7
|
|
|||||
Currency Translation Adjustment
|
16.0
|
|
3.2
|
|
0.9
|
|
20.1
|
|
|
18.9
|
|
|||||
Total Other Comprehensive Income, Net of Tax
|
15.9
|
|
3.1
|
|
1.0
|
|
20.0
|
|
|
17.7
|
|
|||||
Total Comprehensive Income
|
$
|
45.8
|
|
$
|
13.0
|
|
$
|
3.9
|
|
$
|
62.7
|
|
|
$
|
54.7
|
|
In millions, except share and per share amounts
|
March 31,
2018 |
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
||||
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and Cash Equivalents
|
$
|
52.5
|
|
|
$
|
67.4
|
|
Receivables, Net
|
742.7
|
|
|
422.8
|
|
||
Inventories, Net
|
964.4
|
|
|
634.0
|
|
||
Other Current Assets
|
65.5
|
|
|
45.7
|
|
||
Total Current Assets
|
1,825.1
|
|
|
1,169.9
|
|
||
Property, Plant and Equipment, Net
|
3,104.1
|
|
|
1,867.2
|
|
||
Goodwill
|
1,607.2
|
|
|
1,323.0
|
|
||
Intangible Assets, Net
|
514.9
|
|
|
436.5
|
|
||
Other Assets
|
79.0
|
|
|
66.4
|
|
||
Total Assets
|
$
|
7,130.3
|
|
|
$
|
4,863.0
|
|
|
|
|
|
||||
LIABILITIES
|
|
|
|
||||
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Short-Term Debt and Current Portion of Long-Term Debt
|
$
|
55.6
|
|
|
$
|
61.3
|
|
Accounts Payable
|
613.6
|
|
|
516.5
|
|
||
Compensation and Employee Benefits
|
147.0
|
|
|
113.4
|
|
||
Other Accrued Liabilities
|
187.1
|
|
|
160.2
|
|
||
Total Current Liabilities
|
1,003.3
|
|
|
851.4
|
|
||
Long-Term Debt
|
3,043.5
|
|
|
2,213.2
|
|
||
Deferred Income Tax Liabilities
|
437.4
|
|
|
321.8
|
|
||
Accrued Pension and Postretirement Benefits
|
78.1
|
|
|
80.0
|
|
||
Other Noncurrent Liabilities
|
125.1
|
|
|
104.7
|
|
||
|
|
|
|
|
|||
Redeemable Noncontrolling Interest (Note 12)
|
285.1
|
|
|
—
|
|
||
|
|
|
|
||||
SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Preferred Stock, par value $.01 per share; 100,000,000 shares authorized; no shares issued or outstanding
|
—
|
|
|
—
|
|
||
Common Stock, par value $.01 per share; 1,000,000,000 shares authorized; 310,279,527 and 309,715,624 shares issued and outstanding at March 31, 2018 and December 31, 2017, respectively
|
3.1
|
|
|
3.1
|
|
||
Capital in Excess of Par Value
|
2,077.8
|
|
|
1,683.6
|
|
||
Accumulated Deficit
|
(49.4
|
)
|
|
(56.0
|
)
|
||
Accumulated Other Comprehensive Loss
|
(322.9
|
)
|
|
(338.8
|
)
|
||
Total Graphic Packaging Holding Company Shareholders' Equity
|
1,708.6
|
|
|
1,291.9
|
|
||
Noncontrolling Interest
|
449.2
|
|
|
—
|
|
||
Total Equity
|
2,157.8
|
|
|
1,291.9
|
|
||
Total Liabilities and Shareholders' Equity
|
$
|
7,130.3
|
|
|
$
|
4,863.0
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net Income
|
$
|
42.7
|
|
|
$
|
37.0
|
|
Non-cash Items Included in Net Income:
|
|
|
|
||||
Depreciation and Amortization
|
109.8
|
|
|
75.0
|
|
||
Deferred Income Taxes
|
(3.1
|
)
|
|
11.9
|
|
||
Amount of Postretirement Expense Less Than Funding
|
(1.2
|
)
|
|
(11.9
|
)
|
||
Other, Net
|
7.4
|
|
|
4.1
|
|
||
Changes in Operating Assets and Liabilities
|
(345.7
|
)
|
|
(207.8
|
)
|
||
Net Cash Used in Operating Activities
|
(190.1
|
)
|
|
(91.7
|
)
|
||
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital Spending
|
(88.9
|
)
|
|
(69.2
|
)
|
||
Packaging Machinery Spending
|
(3.2
|
)
|
|
(6.9
|
)
|
||
Acquisition of Businesses, Net of Cash Acquired
|
(3.5
|
)
|
|
—
|
|
||
Beneficial Interest on Sold Receivables
|
282.6
|
|
|
130.2
|
|
||
Beneficial Interest Obtained in Exchange for Proceeds
|
(138.0
|
)
|
|
(10.1
|
)
|
||
Other, Net
|
(2.3
|
)
|
|
(1.2
|
)
|
||
Net Cash Provided by Investing Activities
|
46.7
|
|
|
42.8
|
|
||
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Repurchase of Common Stock
|
—
|
|
|
(40.1
|
)
|
||
Payments on Debt
|
(125.0
|
)
|
|
(6.3
|
)
|
||
Borrowings under Revolving Credit Facilities
|
610.9
|
|
|
310.1
|
|
||
Payments on Revolving Credit Facilities
|
(323.5
|
)
|
|
(206.4
|
)
|
||
Repurchase of Common Stock related to Share-Based Payments
|
(4.0
|
)
|
|
(10.0
|
)
|
||
Debt Issuance Costs
|
(7.9
|
)
|
|
—
|
|
||
Dividends Paid
|
(23.2
|
)
|
|
(23.6
|
)
|
||
Other, Net
|
—
|
|
|
2.2
|
|
||
Net Cash Provided by Financing Activities
|
127.3
|
|
|
25.9
|
|
||
Effect of Exchange Rate Changes on Cash
|
1.2
|
|
|
1.3
|
|
||
Net Decrease in Cash and Cash Equivalents
|
(14.9
|
)
|
|
(21.7
|
)
|
||
Cash and Cash Equivalents at Beginning of Period
|
67.4
|
|
|
59.1
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
52.5
|
|
|
$
|
37.4
|
|
|
|
|
|
||||
Non-cash Investing Activities:
|
|
|
|
||||
Beneficial Interest Obtained in Exchange for Trade Receivables
|
$
|
287.5
|
|
|
$
|
123.6
|
|
Non-cash Investment in NACP Combination
|
1,235.7
|
|
|
—
|
|
||
Non-cash Investing Activities
|
$
|
1,523.2
|
|
|
$
|
123.6
|
|
Non-cash Financing Activities:
|
|
|
|
||||
Non-cash Financing of NACP Combination
|
$
|
660.0
|
|
|
$
|
—
|
|
Non-Cash Financing Activities
|
$
|
660.0
|
|
|
$
|
—
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
Receivables Sold and Derecognized
|
$
|
844.8
|
|
|
$
|
346.2
|
|
Proceeds Collected on Behalf of Financial Institutions
|
833.7
|
|
|
352.8
|
|
||
Proceeds Paid to Financial Institutions
|
128.7
|
|
|
9.1
|
|
||
Deferred Purchase Price
|
240.4
|
|
|
33.1
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
Charges Associated with Business Combinations
|
$
|
27.0
|
|
|
$
|
3.9
|
|
Shutdown and Other Special Charges
|
0.8
|
|
|
4.7
|
|
||
Gain on Sale of Assets
|
(1.5
|
)
|
|
—
|
|
||
Total
|
$
|
26.3
|
|
|
$
|
8.6
|
|
In millions
|
March 31, 2018
|
|
December 31, 2017
|
||||
Finished Goods
|
$
|
406.5
|
|
|
$
|
240.5
|
|
Work in Progress
|
106.7
|
|
|
74.1
|
|
||
Raw Materials
|
298.2
|
|
|
229.4
|
|
||
Supplies
|
153.0
|
|
|
90.0
|
|
||
Total
|
$
|
964.4
|
|
|
$
|
634.0
|
|
In millions
|
|
Amounts Recognized as of Acquisition Dates
|
||
Purchase Price
|
|
$
|
1,235.7
|
|
Assumed Debt
|
|
660.0
|
|
|
Total Purchase Consideration
|
|
$
|
1,895.7
|
|
|
|
|
||
Receivables, Net
|
|
$
|
143.0
|
|
Inventories, Net
|
|
295.1
|
|
|
Other Current Assets
|
|
20.9
|
|
|
Property, Plant and Equipment, Net
|
|
1,217.8
|
|
|
Intangible Assets, Net
(a)
|
|
91.6
|
|
|
Other Assets
|
|
6.0
|
|
|
Total Assets Acquired
|
|
1,774.4
|
|
|
Accounts Payable
|
|
111.9
|
|
|
Compensation and Employee Benefits
|
|
20.7
|
|
|
Current Liabilities
|
|
12.4
|
|
|
Other Noncurrent Liabilities
|
|
10.1
|
|
|
Total Liabilities Assumed
|
|
155.1
|
|
|
Net Assets Acquired
|
|
1,619.3
|
|
|
Goodwill
|
|
276.4
|
|
|
Total Estimated Fair Value of Net Assets Acquired
|
|
$
|
1,895.7
|
|
|
Three Months Ended
|
||
|
March 31,
|
||
In millions, except per share data
|
2017
|
||
Net Sales
|
$
|
1,427.8
|
|
Net Income Attributable to Graphic Packaging Holding Company
|
51.6
|
|
|
Income Per Share — Basic
|
0.17
|
|
|
Income Per Share — Diluted
|
0.16
|
|
In millions
|
March 31, 2018
|
|
December 31, 2017
|
||||
Senior Notes with interest payable semi-annually at 4.125%, effective rate of 4.18%, payable in 2024
|
$
|
300.0
|
|
|
$
|
300.0
|
|
Senior Notes with interest payable semi-annually at 4.875%, effective rate of 4.93%, payable in 2022
|
250.0
|
|
|
250.0
|
|
||
Senior Notes with interest payable semi-annually at 4.75%, effective rate of 4.78%, payable in 2021
|
425.0
|
|
|
425.0
|
|
||
Senior Secured Term Loan Facilities with interest payable at various dates at floating rates (3.19% at March 31, 2018) payable into 2023
|
1,460.0
|
|
|
925.0
|
|
||
Senior Secured Revolving Facilities with interest payable at floating rates (2.96% at March 31, 2018) payable in 2023
|
601.2
|
|
|
319.0
|
|
||
Capital Lease Obligations
|
29.5
|
|
|
30.0
|
|
||
Other
|
29.1
|
|
|
28.9
|
|
||
Total Long-Term Debt
|
3,094.8
|
|
|
2,277.9
|
|
||
Less: Current Portion
|
38.6
|
|
|
52.2
|
|
||
|
3,056.2
|
|
|
2,225.7
|
|
||
Less: Unamortized Deferred Debt Issuance Costs
|
12.7
|
|
|
12.5
|
|
||
Total
|
$
|
3,043.5
|
|
|
$
|
2,213.2
|
|
In millions
|
Total
Commitments
|
|
Total
Outstanding
|
|
Total Available
|
||||||
Senior Secured Domestic Revolving Credit Facility
(a)
|
$
|
1,450.0
|
|
|
$
|
498.2
|
|
|
$
|
924.8
|
|
Senior Secured International Revolving Credit Facility
|
193.7
|
|
|
103.0
|
|
|
90.7
|
|
|||
Other International Facilities
|
69.3
|
|
|
40.4
|
|
|
28.9
|
|
|||
Total
|
$
|
1,713.0
|
|
|
$
|
641.6
|
|
|
$
|
1,044.4
|
|
(a)
|
In accordance with its debt agreements, the Company’s availability under its revolving credit facilities has been reduced by the amount of standby letters of credit issued of
$27.0 million
as of
March 31, 2018
. These letters of credit are primarily used as security against its self-insurance obligations and workers’ compensation obligations. These letters of credit expire at various dates through early 2019 unless extended.
|
|
RSUs
|
|
Weighted Average
Grant Date Fair
Value Per Share
|
|||
RSUs — Employees
|
1,497,281
|
|
|
$
|
14.83
|
|
|
Pension Benefits
|
|
Postretirement Health Care Benefits
|
|||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|||||||||||||
|
March 31,
|
|
March 31,
|
|||||||||||||
In millions
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
||||||||
Components of Net Periodic Cost:
|
|
|
|
|
|
|
|
|
||||||||
Service Cost
|
$
|
4.6
|
|
|
$
|
2.6
|
|
|
$
|
0.2
|
|
|
$
|
0.2
|
|
|
Interest Cost
|
10.5
|
|
|
10.6
|
|
|
0.3
|
|
|
0.3
|
|
|
||||
Administrative Expenses
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
Expected Return on Plan Assets
|
(16.0
|
)
|
|
(16.0
|
)
|
|
—
|
|
|
—
|
|
|
||||
Amortization:
|
|
|
|
|
|
|
|
|
||||||||
Prior Service Cost (Credit)
|
0.1
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
||||
Actuarial Loss (Gain)
|
1.4
|
|
|
1.7
|
|
|
(0.5
|
)
|
|
(0.5
|
)
|
|
||||
Net Periodic Cost (Benefit)
|
$
|
0.7
|
|
|
$
|
(1.0
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(0.1
|
)
|
|
Start
|
End
|
(In Millions)
Notional Amount |
Weighted Average Interest Rate
|
12/01/2017
|
10/01/2018
|
$250.0
|
1.16%
|
04/01/2018
|
01/01/2019
|
$150.0
|
2.03%
|
04/01/2018
|
01/01/2020
|
$150.0
|
2.25%
|
04/01/2018
|
10/01/2020
|
$150.0
|
2.36%
|
In millions
|
|
||
Balance at December 31, 2017
|
$
|
(0.3
|
)
|
Reclassification to Earnings
|
(0.1
|
)
|
|
Current Period Change in Fair Value
|
(0.8
|
)
|
|
Balance at March 31, 2018
|
$
|
(1.2
|
)
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
NET SALES:
|
|
|
|
||||
Paperboard Mills
|
$
|
278.0
|
|
|
$
|
98.1
|
|
Americas Paperboard Packaging
|
989.9
|
|
|
792.8
|
|
||
Europe Paperboard Packaging
|
174.5
|
|
|
139.7
|
|
||
Corporate/Other/Eliminations
(a)
|
33.6
|
|
|
30.9
|
|
||
Total
|
$
|
1,476.0
|
|
|
$
|
1,061.5
|
|
|
|
|
|
||||
INCOME (LOSS) FROM OPERATIONS:
|
|
|
|
||||
Paperboard Mills
|
$
|
(6.7
|
)
|
|
$
|
(12.3
|
)
|
Americas Paperboard Packaging
|
112.0
|
|
|
89.4
|
|
||
Europe Paperboard Packaging
|
14.7
|
|
|
7.0
|
|
||
Corporate and Other
(b)
|
(46.0
|
)
|
|
(12.5
|
)
|
||
Total
|
$
|
74.0
|
|
|
$
|
71.6
|
|
|
|
|
|
||||
DEPRECIATION AND AMORTIZATION:
|
|
|
|
||||
Paperboard Mills
|
$
|
51.5
|
|
|
$
|
30.6
|
|
Americas Paperboard Packaging
|
41.0
|
|
|
30.2
|
|
||
Europe Paperboard Packaging
|
12.5
|
|
|
9.8
|
|
||
Corporate and Other
|
4.8
|
|
|
4.4
|
|
||
Total
|
$
|
109.8
|
|
|
$
|
75.0
|
|
(a)
|
Includes Revenue from contracts with customers for the Australia and Pacific Rim operating segments, which is
no
t material.
|
(b)
|
Includes expenses related to acquisitions, integration activities and shutdown costs.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions, except per share data
|
2018
|
|
2017
|
||||
Net Income Attributable to Graphic Packaging Holding Company
|
$
|
29.9
|
|
|
$
|
37.0
|
|
Weighted Average Shares:
|
|
|
|
||||
Basic
|
310.6
|
|
|
312.9
|
|
||
Dilutive Effect of RSUs
|
0.7
|
|
|
1.2
|
|
||
Diluted
|
311.3
|
|
|
314.1
|
|
||
Income Per Share — Basic
|
$
|
0.10
|
|
|
$
|
0.12
|
|
Income Per Share — Diluted
|
$
|
0.10
|
|
|
$
|
0.12
|
|
In millions
|
|
||
Fair Value at December 31, 2017
|
$
|
—
|
|
Fair Value of Redeemable Noncontrolling Interest at January 1, 2018
|
282.4
|
|
|
Net Income Attributable to Redeemable Noncontrolling Interest
|
2.9
|
|
|
Other Comprehensive Income, Net of Tax
|
1.0
|
|
|
Distributions of Membership Interest
|
(1.2
|
)
|
|
Fair Value at March 31, 2018
|
$
|
285.1
|
|
In millions
|
Graphic Packaging Holding Company Shareholders Equity
|
Noncontrolling Interest
(a)
|
Total Shareholders' Equity
|
||||||
Balance at December 31, 2017
|
$
|
1,291.9
|
|
$
|
—
|
|
$
|
1,291.9
|
|
NACP Combination
|
395.1
|
|
439.8
|
|
834.9
|
|
|||
Net Income
|
29.9
|
|
9.9
|
|
39.8
|
|
|||
Other Comprehensive Income, Net of Tax
|
15.9
|
|
3.1
|
|
19.0
|
|
|||
Dividends Declared
|
(23.3
|
)
|
—
|
|
(23.3
|
)
|
|||
Compensation Expense Under Share-Based Plans
|
3.1
|
|
—
|
|
3.1
|
|
|||
Repurchase of Common Stock related to Share-Based Payments
|
(4.0
|
)
|
—
|
|
(4.0
|
)
|
|||
Distributions of Membership Interest
|
—
|
|
(3.6
|
)
|
(3.6
|
)
|
|||
Balance at March 31, 2018
|
$
|
1,708.6
|
|
$
|
449.2
|
|
$
|
2,157.8
|
|
In millions
|
Derivative Instruments
|
|
Pension Benefit Plans
|
|
Postretirement Benefit Plans
|
|
Currency Translation Adjustment
|
|
Total
|
||||||||||
Balance at December 31, 2017
|
$
|
(10.3
|
)
|
|
$
|
(242.5
|
)
|
|
$
|
15.8
|
|
|
$
|
(101.8
|
)
|
|
$
|
(338.8
|
)
|
Other Comprehensive (Loss) Income before Reclassifications
|
(0.7
|
)
|
|
—
|
|
|
—
|
|
|
20.1
|
|
|
19.4
|
|
|||||
Amounts Reclassified from Accumulated Other Comprehensive (Loss) Income
(b)
|
(0.1
|
)
|
|
1.2
|
|
|
(0.5
|
)
|
|
—
|
|
|
0.6
|
|
|||||
Net Current-period Other Comprehensive (Loss) Income
|
(0.8
|
)
|
|
1.2
|
|
|
(0.5
|
)
|
|
20.1
|
|
|
20.0
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Current-period Other Comprehensive Income (Loss) Attributable to Noncontrolling Interest
(c)
|
0.2
|
|
|
(0.3
|
)
|
|
0.1
|
|
|
(4.1
|
)
|
|
(4.1
|
)
|
|||||
Balance at March 31, 2018
|
$
|
(10.9
|
)
|
|
$
|
(241.6
|
)
|
|
$
|
15.4
|
|
|
$
|
(85.8
|
)
|
|
$
|
(322.9
|
)
|
(a)
|
All amounts are net of income taxes.
|
In millions
|
|
|
|
|
||
Details about Accumulated Other Comprehensive Income Components
|
|
Amount Reclassified from Accumulated Other Comprehensive Income (Loss)
|
|
Affected Line Item in the Statement Where Net Income is Presented
|
||
Derivatives Instruments:
|
|
|
|
|
||
Commodity Contracts
|
|
$
|
(0.2
|
)
|
|
Cost of Sales
|
Foreign Currency Contracts
|
|
0.4
|
|
|
Other Expense (Income), Net
|
|
Interest Rate Swap Agreements
|
|
(0.3
|
)
|
|
Interest Income, Net
|
|
|
|
(0.1
|
)
|
|
Total before Tax
|
|
|
|
—
|
|
|
Tax Expense
|
|
|
|
$
|
(0.1
|
)
|
|
Net of Tax
|
|
|
|
|
|
||
Amortization of Defined Benefit Pension Plans:
|
|
|
|
|
||
Prior Service Costs
|
|
$
|
0.1
|
|
(c)
|
|
Actuarial Losses
|
|
1.4
|
|
(c)
|
|
|
|
|
1.5
|
|
|
Total before Tax
|
|
|
|
(0.3
|
)
|
|
Tax Benefit
|
|
|
|
$
|
1.2
|
|
|
Net of Tax
|
|
|
|
|
|
||
Amortization of Postretirement Benefit Plans:
|
|
|
|
|
||
Prior Service Credits
|
|
$
|
(0.1
|
)
|
(c)
|
|
Actuarial Gains
|
|
(0.5
|
)
|
(c)
|
|
|
|
|
(0.6
|
)
|
|
Total before Tax
|
|
|
|
0.1
|
|
|
Tax Expense
|
|
|
|
$
|
(0.5
|
)
|
|
Net of Tax
|
|
|
|
|
|
||
Total Reclassifications for the Period
|
|
$
|
0.6
|
|
|
|
(c)
|
These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see “
Note 6 — Pensions and Other Postretirement Benefits
").
|
Ø
|
Overview of Business
|
Ø
|
Overview of 2018 Results
|
Ø
|
Results of Operations
|
Ø
|
Financial Condition, Liquidity and Capital Resources
|
Ø
|
Critical Accounting Policies
|
Ø
|
New Accounting Standards
|
Ø
|
Business Outlook
|
•
|
Net Sales
for the
three months ended
March 31, 2018
,
increased
$414.5 million
or
39.0%
to
$1,476.0 million
from
$1,061.5 million
for the
three months ended
March 31, 2017
, due to the NACP Combination and 2017 Acquisitions discussed below, favorable currency exchange rates and higher selling prices.
|
•
|
Income from Operations
for the
three months ended
March 31, 2018
increased
$2.4 million
or
3.4%
to
$74.0 million
from
$71.6 million
for the
three months ended
March 31, 2017
due to the NACP Combination and 2017 Acquisitions, cost savings through continuous improvement and other programs, favorable currency exchange rates and the higher selling prices, partially offset by higher inflation.
|
•
|
On January 1, 2018, the Company combined its business with the North America Consumer Packaging business ("NACP"), of International Paper Company's ("IP"), referred to as the NACP Combination. NACP was a leading producer of SBS paperboard and paper-based foodservice products. The NACP business included two SBS mills located in Augusta, Georgia and Texarkana, Texas, three converting facilities in the U.S. and one in the United Kingdom.
|
•
|
During 2017, the Company acquired Seydaco Packaging Corp. ("Seydaco"), Norgraft Packaging, S.A. ("Norgraft"), and Carton Craft Corporation ("Carton Craft"). These transactions are referred to collectively as the "2017 Acquisitions."
|
•
|
On February 22, 2018, the Company's board of directors declared a quarterly dividend of
$0.075
per share of common stock paid on April 5, 2018 to shareholders of record as of March 15, 2018.
|
•
|
On January 10, 2017, the Company's board of directors authorized an additional share repurchase program to allow the Company to purchase up to $
250 million
of the Company's issued and outstanding shares of common stock through open market purchases, privately negotiated transactions and Rule 10b5-1 plans (the "2017 share repurchase program"). The original
$250 million
share repurchase program was authorized on February 4, 2015 (the "2015 share repurchase program"). During the first
three months
of
2018
, the Company did not repurchase any shares of its common stock. The Company repurchased approximately
3 million
shares at an average price of
$12.98
during the
three months
ended
March 31, 2017
, including approximately
1.4 million
shares repurchased under the 2015 share repurchase program thereby completing that program. As of
March 31, 2018
, the Company has approximately
$210 million
available for additional repurchases under the 2017 share repurchase program.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
Net Sales
|
$
|
1,476.0
|
|
|
$
|
1,061.5
|
|
Income from Operations
|
74.0
|
|
|
71.6
|
|
||
Nonoperating Pension and Postretirement Benefit Income
|
4.2
|
|
|
3.9
|
|
||
Interest Expense, Net
|
(28.8
|
)
|
|
(21.3
|
)
|
||
Loss on Modification or Extinguishment of Debt
|
(1.9
|
)
|
|
—
|
|
||
Income before Income Taxes and Equity Income of Unconsolidated Entity
|
47.5
|
|
|
54.2
|
|
||
Income Tax Expense
|
(5.1
|
)
|
|
(17.6
|
)
|
||
Income before Equity Income of Unconsolidated Entity
|
42.4
|
|
|
36.6
|
|
||
Equity Income of Unconsolidated Entity
|
0.3
|
|
|
0.4
|
|
||
Net Income
|
$
|
42.7
|
|
|
$
|
37.0
|
|
|
Three Months Ended March 31,
|
|||||||||||||
In millions
|
2018
|
|
2017
|
|
Increase
|
|
Percent
Change
|
|||||||
Consolidated
|
$
|
1,476.0
|
|
|
$
|
1,061.5
|
|
|
$
|
414.5
|
|
|
39.0
|
%
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
|
|
Variances
|
|
|
||||||||||||||||||
In millions
|
2017
|
|
Price
|
|
Volume/Mix
|
|
Exchange
|
|
Total
|
|
2018
|
||||||||||||
Consolidated
|
$
|
1,061.5
|
|
|
$
|
5.5
|
|
|
$
|
385.0
|
|
|
$
|
24.0
|
|
|
$
|
414.5
|
|
|
$
|
1,476.0
|
|
|
Three Months Ended March 31,
|
||||||||||||
In millions
|
2018
|
|
2017
|
|
Increase
|
|
Percent
Change
|
||||||
Consolidated
|
$
|
74.0
|
|
|
$
|
71.6
|
|
|
$
|
2.4
|
|
|
3.4%
|
|
Three Months Ended March 31,
|
|||||||||||||||||||||||||||||||
|
|
|
Variances
|
|
|
|||||||||||||||||||||||||||
In millions
|
2017
|
|
Price
|
|
Volume/Mix
|
|
|
Inflation
|
|
Exchange
|
|
Other
(a)
|
|
Total
|
|
2018
|
||||||||||||||||
Consolidated
|
$
|
71.6
|
|
|
$
|
5.5
|
|
|
$
|
0.3
|
|
|
|
$
|
(17.8
|
)
|
|
$
|
4.5
|
|
|
$
|
9.9
|
|
|
$
|
2.4
|
|
|
$
|
74.0
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
NET SALES:
|
|
|
|
||||
Paperboard Mills
|
$
|
278.0
|
|
|
$
|
98.1
|
|
Americas Paperboard Packaging
|
989.9
|
|
|
792.8
|
|
||
Europe Paperboard Packaging
|
174.5
|
|
|
139.7
|
|
||
Corporate/Other/Eliminations
(a)
|
33.6
|
|
|
30.9
|
|
||
Total
|
$
|
1,476.0
|
|
|
$
|
1,061.5
|
|
|
|
|
|
||||
INCOME (LOSS) FROM OPERATIONS:
|
|
|
|
||||
Paperboard Mills
|
$
|
(6.7
|
)
|
|
$
|
(12.3
|
)
|
Americas Paperboard Packaging
|
112.0
|
|
|
89.4
|
|
||
Europe Paperboard Packaging
|
14.7
|
|
|
7.0
|
|
||
Corporate and Other
(b)
|
(46.0
|
)
|
|
(12.5
|
)
|
||
Total
|
$
|
74.0
|
|
|
$
|
71.6
|
|
(a)
|
Includes Revenue from contracts with customers for the Australia and Pacific Rim operating segments, which is not material.
|
(b)
|
Includes expenses related to acquisitions, integration activities and shutdown costs.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
Net Cash Used in Operating Activities
|
$
|
(190.1
|
)
|
|
$
|
(91.7
|
)
|
Net Cash Provided by Investing Activities
|
$
|
46.7
|
|
|
$
|
42.8
|
|
Net Cash Provided by Financing Activities
|
$
|
127.3
|
|
|
$
|
25.9
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
In millions
|
2018
|
|
2017
|
||||
Receivables Sold and Derecognized
|
$
|
844.8
|
|
|
$
|
346.2
|
|
Proceeds Collected on Behalf of Financial Institutions
|
833.7
|
|
|
352.8
|
|
||
Proceeds Paid to Financial Institutions
|
128.7
|
|
|
9.1
|
|
||
Deferred Purchase Price
|
240.4
|
|
|
33.1
|
|
•
|
Depreciation and amortization expense between $430 million and $450 million, excluding approximately $6 million of pension amortization.
|
•
|
Interest expense of $125 million to $135 million, including approximately $6 million to $7 million of non-cash interest expense associated with amortization of debt issuance costs.
|
•
|
Pension plan contributions of $5 million to $10 million.
|
Exhibit Number
|
Description
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
32.2
|
|
|
|
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase
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(Registrant)
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/s/ STEPHEN R. SCHERGER
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Senior Vice President and Chief Financial Officer (Principal Financial Officer)
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April 25, 2018
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Stephen R. Scherger
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||
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/s/ DEBORAH R. FRANK
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Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)
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April 25, 2018
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Deborah R. Frank
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1 Year Graphic Packaging Chart |
1 Month Graphic Packaging Chart |
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