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Graphic Packaging net sales grow in Q3

The company attributes its sales growth to improved volume and mix related to organic growth and acquisitions.

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October 21, 2020

Graphic Packaging Holding Co., a packaging solutions provider based in Atlanta, has announced that net organic sales growth has exceeded 4 percent for the third quarter of 2020 compared with the same quarter in 2019.

In the third quarter of 2020, Graphic Packaging achieved net sales of $1,697.7 million compared with $1,581.6 million in the same time period in 2019, according to the company’s Oct. 20 earnings report. Graphic Packaging states that this is a 7.3 percent increase from the same time in 2019. Net organic sales grew 4.2 percent in the third quarter of 2020 compared with where they were at in the third quarter of 2019, and net organic sales grew 3.5 percent for the first nine months of 2020 compared with the same time period in 2019.

The company says the sales growth in the third quarter can be attributed to improved volume and mix related to organic growth and acquisitions as well as $6.9 million in favorable foreign exchange.

“We continue to deliver excellent results in 2020 consistent with our Vision 2025 goals, and we are capturing organic sales growth as we answer the call from consumers for more sustainable packaging solutions,” says Michael Doss, president and CEO at Graphic Packaging Holding Co. “Net organic sales growth accelerated on a sequential basis to over 4 percent in the third quarter. Our business pipeline remains robust, and we are uniquely positioned to capture growth with our innovative fiber-based packaging solutions.”

The company reports that net income was $63.7 million for the third quarter of 2020 compared with $52.1 million in the third quarter of 2019. Additionally, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $250.2 million in the third quarter of 2020 compared with $244.3 million in the third quarter of 2019. The company reports that adjusted EBITDA in the third quarter of 2020 was positively impacted by $14.8 million of favorable volume and mix, $3 million of commodity input cost deflation, $6.7 million of improved net operating performance and $3.4 million of foreign exchange.

Graphic Packaging states that its total debt increased $184.6 million during the third quarter of 2020 to $3,713.9 million compared with the second quarter of 2020. Total net debt increased $212.7 million in the third quarter of 2020 to $3,658.4 million compared with the second quarter of 2020. Additionally, capital expenditures for the third quarter of 2020 were $119.1 million, up compared with $71.6 million in the third quarter of 2019, largely due to the investment in a new coated recycled board paper machine in Kalamazoo, Michigan.

“At Graphic Packaging, we are ensuring continuity of service for our customers, a safe environment for our employees and long-term returns for our stakeholders,” Doss concludes. “Our transformation to a growth culture is a direct result of the compelling value proposition we offer customers and the ongoing investments we are making to ensure we lead the industry in quality, service and innovation. Our teams are executing during a challenging time, and we are committed to leadership in the paperboard packaging industry by providing sustainable and exciting new packaging solutions.”