Pactiv Evergreen Inc. (“Pactiv Evergreen” or the “Company”), today
reported results for the fourth quarter and fiscal year ended
December 31, 2021.
Michael King, President and Chief Executive
Officer of Pactiv Evergreen, said, “We finished 2021 with
significant momentum across all of our business segments, achieving
30% revenue growth in the quarter. This included a 23% improvement
in price/mix in the quarter due to contractual cost pass-through
price increases and pricing actions that partially offset
inflationary increases in materials, logistics and manufacturing
costs.
Due to the continued labor constraints impacting
our industry that worsened in the fourth quarter due to
Omicron-related absenteeism, our fourth quarter and full year 2021
results were below the revised full year fiscal 2021 guidance we
provided in September. While these industry challenges will likely
continue for several quarters, the Company remains committed to
strengthening our innovation pipeline, increasing productivity and
exceeding our valued customers’ expectations.”
King continued, “While 2021 was a challenging
year for Pactiv Evergreen, and the industry overall, it was also a
transformational year for our Company. We have made great progress
with the integration of Fabri-Kal into our business as we continue
to execute on the strategic priorities we previously outlined when
we announced this transaction. I am also pleased with our recent
agreement to sell our carton packaging and filling machinery
businesses in China, Korea and Taiwan as we refine our strategic
focus on our North America markets.
On February 16, the Company entered into an
agreement with a life insurance company to further reduce our gross
pension plan liabilities by approximately $1,260 million. The
transfer of these obligations will be funded from existing plan
assets. This follows a $959 million pension obligation transfer in
2021 and represents another milestone on our journey to improve our
risk profile and strengthen our financial position.”
Positioning the Company for Future Growth
Pactiv Evergreen continues to focus on executing
strategic priorities to better position the Company for future
growth:
- On October 1, 2021,
the Company completed the acquisition of Fabri-Kal, a leading
manufacturer of foodservice and consumer brand packaging solutions.
The integration of the business is progressing as expected. This
acquisition further expands the Company’s position in the
foodservice and consumer packaged goods businesses, and provides
opportunities to leverage its combined manufacturing and
distribution capabilities to maximize its service levels. The
Company’s fourth quarter results include a full quarter of
Fabri-Kal’s results.
- On October 12,
2021, the Company announced an agreement to sell its 50 percent
interest in Naturepak Beverage Packaging Co. Ltd., which supplies
customers in the Middle East and Africa region from manufacturing
plants in Morocco and Saudi Arabia.
- As of December 31,
2021, the Company has completed the previously announced exit of
the coated groundwood paper business.
- On January 5, 2022,
the Company announced an agreement to sell its carton packaging and
filling machinery businesses in China, Korea and Taiwan to SIG
Combibloc Group Ltd, for $335 million, subject to adjustments for
cash, indebtedness and working capital as of the date of
completion. The Company believes that this transaction will
position it to further its strategic focus in North America, where
the Company is established as a leading manufacturer of fresh food
and beverage packaging, servicing many of the world’s most beloved
brands.
- On February 16,
2022, the Company entered into an agreement to purchase a
non-participating group annuity contract with an insurance company
to transfer approximately $1,260 million of pension plan gross
liabilities. The Company made this decision to reduce the financial
risk associated with its pension obligations, which is subject to
market fluctuations, without creating risk for beneficiaries.
Fourth Quarter 2021 Results
Net revenues in the fourth quarter of 2021 were
$1,527 million compared to $1,175 million in the prior year period.
The increase was primarily due to favorable pricing, primarily due
to higher material costs passed through to customers across all
segments, as well as a benefit from the Foodservice segment’s
acquisition of Fabri-Kal on October 1, 2021, partially offset by
slight declines due to lower volumes as well as the impact of a
disposition completed in the first quarter of 2021.
Net income from continuing operations was $34
million in the fourth quarter of 2021 compared to $18 million in
the fourth quarter of 2020. The change was primarily driven by $46
million of lower interest expense driven by a lower loss on
extinguishment of debt in the current year quarter and $25 million
in higher gross profit, partially offset by a $39 million increase
in tax expense, primarily attributable to changes in the Company’s
valuation allowance associated with deferred interest deductions in
the prior year period.
Adjusted EBITDA1 was $205 million in the fourth
quarter of 2021 compared to $170 million in the fourth quarter of
2020. The increase was primarily due to favorable pricing,
partially offset by higher material, logistics and manufacturing
costs.
Segment Results (compared to the fourth quarter of
2020)
Foodservice
|
|
For the Three Months Ended December 31, |
|
|
Components of Change in Net Revenues |
|
|
|
2021 |
|
|
2020 |
|
|
Change |
|
|
% Change |
|
|
Price/Mix |
|
|
Volume |
|
|
FX |
|
|
Acquisitions |
|
Total segment net revenues |
|
$ |
722 |
|
|
$ |
460 |
|
|
$ |
262 |
|
|
|
57 |
% |
|
|
30 |
% |
|
|
4 |
% |
|
|
— |
% |
|
|
23 |
% |
Segment Adjusted EBITDA |
|
$ |
104 |
|
|
$ |
71 |
|
|
$ |
33 |
|
|
|
46 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA
margin |
|
|
14 |
% |
|
|
15 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The increase in net revenues was primarily due
to favorable pricing, primarily due to higher material costs passed
through to customers, as well the impact from the acquisition of
Fabri-Kal and higher sales volume.
The increase in Adjusted EBITDA was primarily
due to favorable pricing and the impact from the acquisition of
Fabri-Kal, partially offset by higher material and manufacturing
costs.
Food Merchandising
|
|
For the Three Months Ended December 31, |
|
|
Components of Change in Net Revenues |
|
|
|
2021 |
|
|
2020 |
|
|
Change |
|
|
% Change |
|
|
Price/Mix |
|
|
Volume |
|
|
FX |
|
Total segment net revenues |
|
$ |
410 |
|
|
$ |
350 |
|
|
$ |
60 |
|
|
|
17 |
% |
|
|
24 |
% |
|
|
(7 |
)% |
|
|
— |
% |
Segment Adjusted EBITDA |
|
$ |
69 |
|
|
$ |
66 |
|
|
$ |
3 |
|
|
|
5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA
margin |
|
|
17 |
% |
|
|
19 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The increase in net revenues was primarily
driven by favorable pricing, primarily due to higher material costs
passed through to customers, partially offset by lower sales
volume, primarily due to labor shortages.
The increase in Adjusted EBITDA was primarily
due to favorable pricing, partially offset by higher material and
manufacturing costs as well as lower sales volume.
Beverage Merchandising
|
|
For the Three Months Ended December 31, |
|
|
Components of Change in Net Revenues |
|
|
|
2021 |
|
|
2020 |
|
|
Change |
|
|
% Change |
|
|
Price/Mix |
|
|
Volume |
|
|
FX |
|
Total segment net revenues |
|
$ |
412 |
|
|
$ |
363 |
|
|
$ |
49 |
|
|
|
13 |
% |
|
|
11 |
% |
|
|
3 |
% |
|
|
(1 |
)% |
Segment Adjusted EBITDA |
|
$ |
45 |
|
|
$ |
36 |
|
|
$ |
9 |
|
|
|
25 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA
margin |
|
|
11 |
% |
|
|
10 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The increase in net revenues was primarily due
to favorable pricing, primarily due to higher material costs passed
through to customers, higher sales volume due to the market
recovery from the COVID-19 pandemic and favorable product mix.
The increase in Adjusted EBITDA was primarily
driven by favorable pricing, lower manufacturing costs and higher
sales volume, partially offset by higher material and logistics
costs.
Financial Results for the Year Ended December 31,
2021:
- Net
Revenues of $5,437 million for the year ended December 31,
2021 compared to $4,689 million in the prior year period.
- Net
Income from continuing operations of $33 million for the
year ended December 31, 2021 compared to a net loss of $10 million
in the prior year period.
- Adjusted
EBITDA1 from continuing operations of $531 million for the
year ended December 31, 2021 compared to $615 million in the prior
year period. Adjusted EBITDA for the year ended December 31, 2021
includes $50 million of additional costs incurred related to the
impact of Winter Storm Uri.
Net revenues for the year ended December 31,
2021 were $5,437 million compared to $4,689 million in the prior
year period. The increase was attributable to favorable pricing,
principally due to higher material costs passed through to
customers within the Foodservice and Food Merchandising segments,
as well as higher sales volume within the Foodservice and Beverage
Merchandising segments, largely due to higher demand as markets
continue to recover from the COVID-19 pandemic. In addition, the
Foodservice segment’s acquisition of Fabri-Kal on October 1, 2021
contributed $106 million of higher sales for the year ended
December 31, 2021 as compared to the year ended December 31,
2020.
Net income from continuing operations was $33
million for the year ended December 31, 2021 compared to a net loss
of $10 million in the prior year period. The change was primarily
driven by $180 million of lower interest expense driven by lower
average debt outstanding in the current year period and a lower
loss on extinguishment of debt, $49 million of related party
management fees in the comparative period, $35 million of higher
non-operating income driven by a pension settlement gain, $19
million of lower restructuring, asset impairment and other charges
and $13 million of lower foreign exchange losses on cash. These
increases were partially offset by $146 million of lower gross
profit due to higher manufacturing costs, including $50 million of
additional costs incurred related to the impact of Winter Storm
Uri, higher logistics and material costs, net of higher costs
passed through to customers. In addition, income tax benefit was
lower by $108 million driven primarily by the impact of the CARES
Act in the prior year.
Adjusted EBITDA1 was $531 million for the year
ended December 31, 2021 compared to $615 million in the prior year
period. The decrease was primarily due to higher manufacturing,
logistics and material costs, net of higher costs passed through to
customers. These decreases were partially offset by higher sales
volume. Adjusted EBITDA for the year ended December 31, 2021
included $50 million of additional costs incurred related to the
impact of Winter Storm Uri.
Balance Sheet and Cash Flow
Highlights
- Cash and cash
equivalents were $197 million as of December 31, 2021, with a
further $17 million of cash and cash equivalents classified within
current assets held for sale.
- Total outstanding
debt was $4,279 million at December 31, 2021.
- For the quarter
ended December 31, 2021, capital expenditures totaled $83
million.
- The Company paid
dividends to shareholders of $0.40 per share during the year ended
December 31, 2021. The Company’s Board of Directors approved its
fourth quarter 2021 dividend on February 22, 2022 of $0.10 per
share of common stock, payable on March 15, 2022 to shareholders of
record as of March 4, 2022.
Outlook
The Company’s performance in the fourth quarter
demonstrated the resiliency of its business as the Company saw
continued volume recovery and effective pricing actions. While our
teams will work tirelessly to build off of the momentum from the
fourth quarter, the current environment remains challenging with
significant inflationary pressures, volatility in raw material
costs and continued labor challenges. Additionally, the Omicron
variant impacted production capabilities and volume in December
2021 and into the early part of the first quarter of 2022. Despite
these challenges, the Company is providing guidance for Adjusted
EBITDA from continuing operations of $705 million for 20222.
This 2022 guidance takes into account:
- Continued pricing
initiatives across all three businesses;
- Continued
inflationary pressures and labor challenges in the first half of
2022 moderating into the second half of 2022;
- Moderate volume
growth due to tougher comparisons;
- Normalization of
inventory levels to improve service and reliability;
- Full year
contribution from the Fabri-Kal acquisition; and
- Scheduled mill
outages in the second half of 2022.
Conference Call and Webcast Presentation
The Company will host a conference call and
webcast presentation to discuss these results on February 24, 2022
at 8:00 a.m. U.S. Eastern Time. Investors interested in
participating in the live call may dial (877) 407-0789 from the
U.S. or (201) 689-8562 internationally and use access code
13726424. Participants may also access the live webcast and
supplemental presentation on the Pactiv Evergreen Investor
Relations website at
https://investors.pactivevergreen.com/financial-information/sec-filings
under “News & Events.” The Company may from time to time use
this Investor Relations website as a means of disclosing material
non-public information and for complying with our disclosure
obligations under Regulation FD.
About Pactiv Evergreen Inc.
Pactiv Evergreen Inc. (NASDAQ: PTVE) is one of the largest
manufacturers of fresh food and beverage packaging in North
America. With a team of approximately 16,000 employees, the Company
produces a broad range of on-trend and feature-rich products that
protect, package and display food and beverages for today’s
consumers. Its products, many of which are made with recycled,
recyclable or renewable materials, are sold to a diversified mix of
customers, including restaurants, foodservice distributors,
retailers, food and beverage producers, packers and processors.
Learn more at www.pactivevergreen.com.
Note to Investors Regarding Forward
Looking Statements
This press release contains forward-looking
statements. All statements contained in this press release other
than statements of historical fact are forward-looking statements,
including statements regarding our guidance as to our future
financial results and our expectations regarding the duration and
severity of ongoing macroeconomic challenges. In some cases, you
can identify these statements by forward-looking words such as
“may,” “might,” “will,” “should,” “expects,” “plans,”
“anticipates,” “believes,” “estimates,” “predicts,” “potential,”
“likely” or “continue,” the negative of these terms and other
comparable terminology. These statements are only predictions based
on our expectations and projections about future events as of the
date of this press release and are subject to a number of risks,
uncertainties and assumptions that may prove incorrect, any of
which could cause actual results to differ materially from those
expressed or implied by such statements, including, among others,
those described under the heading “Risk Factors” in our Annual
Report on Form 10-K for the year ended December 31, 2020 filed with
the Securities and Exchange Commission, or SEC, our Quarterly
Reports on Form 10-Q for the quarters ended March 31, 2021, June
30, 2021 and September 30, 2021 filed with the SEC and our Annual
Report on Form 10-K for the year ended December 31, 2021 to be
filed with the SEC. New risks emerge from time to time, and it is
not possible for our management to predict all risks, nor can
management assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statement the Company makes. Investors are
cautioned not to place undue reliance on any such forward-looking
statements, which speak only as of the date they are made. Except
as otherwise required by law, the Company undertakes no obligation
to update any forward-looking statement, whether as a result of new
information, future events or otherwise.
Use of Non-GAAP Financial Measures
The Company uses the non-GAAP financial measure
“Adjusted EBITDA” in evaluating our past results and future
prospects. The Company defines Adjusted EBITDA as net income (loss)
from continuing operations calculated in accordance with GAAP plus
the sum of income tax expense (benefit), net interest expense,
depreciation and amortization and further adjusted to exclude
certain items, including but not limited to restructuring, asset
impairment and other related charges, gains or losses on the sale
of businesses and noncurrent assets, non-cash pension income or
expense, operational process engineering-related consultancy costs,
business acquisition costs and purchase accounting adjustments,
unrealized gains or losses on derivatives, foreign exchange gains
or losses on cash, executive transition charges, goodwill
impairment charges, related party management fees and strategic
review and transaction-related costs. The Company has provided
below a reconciliation of Adjusted EBITDA to net income (loss), the
most directly comparable GAAP financial measure.
The Company presents Adjusted EBITDA because it
is a key measure used by our management team to evaluate its
operating performance, generate future operating plans, make
strategic decisions and incentivize and reward its employees. In
addition, our chief operating decision maker uses the Adjusted
EBITDA of each reportable segment to evaluate its respective
operating performance. Accordingly, the Company believes that
presenting this metric provides useful information to investors and
others in understanding and evaluating our operating results in the
same manner as our management team and Board of Directors. The
Company also believes that Adjusted EBITDA and similar measures are
widely used by investors, securities analysts, rating agencies and
other parties in evaluating companies as measures of financial
performance and debt service capabilities.
Non-GAAP information should be considered as
supplemental in nature and is not meant to be considered in
isolation or as a substitute for the related financial information
prepared in accordance with GAAP. In addition, our Adjusted EBITDA
metric may not be the same as or comparable to similar non-GAAP
financial measures presented by other companies. Because of these
and other limitations, you should consider Adjusted EBITDA
alongside other financial performance measures, including our net
income (loss) and other GAAP results. In addition, in evaluating
Adjusted EBITDA, you should be aware that in the future the Company
may incur expenses such as those that are the subject of
adjustments in deriving Adjusted EBITDA and you should not infer
from our presentation of Adjusted EBITDA that our future results
will not be affected by these expenses or any unusual or
non-recurring items.
Pactiv Evergreen
Inc.Consolidated Statements of Income
(Loss)(in millions, except per share
amounts)(unaudited)
|
|
For the Three Months EndedDecember
31, |
|
|
For the Year EndedDecember
31, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Net revenues |
|
$ |
1,527 |
|
|
$ |
1,175 |
|
|
$ |
5,437 |
|
|
$ |
4,689 |
|
Cost of sales |
|
|
(1,314 |
) |
|
|
(987 |
) |
|
|
(4,863 |
) |
|
|
(3,969 |
) |
Gross
profit |
|
|
213 |
|
|
|
188 |
|
|
|
574 |
|
|
|
720 |
|
Selling, general and
administrative expenses |
|
|
(121 |
) |
|
|
(112 |
) |
|
|
(466 |
) |
|
|
(470 |
) |
Goodwill impairment charges |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6 |
) |
Restructuring, asset impairment
and other related charges |
|
|
(1 |
) |
|
|
(10 |
) |
|
|
(9 |
) |
|
|
(28 |
) |
Other income (expense), net |
|
|
2 |
|
|
|
15 |
|
|
|
20 |
|
|
|
(33 |
) |
Operating income from
continuing operations |
|
|
93 |
|
|
|
81 |
|
|
|
119 |
|
|
|
183 |
|
Non-operating income, net |
|
|
13 |
|
|
|
16 |
|
|
|
101 |
|
|
|
66 |
|
Interest expense, net |
|
|
(50 |
) |
|
|
(96 |
) |
|
|
(191 |
) |
|
|
(371 |
) |
Income (loss) from
continuing operations before tax |
|
|
56 |
|
|
|
1 |
|
|
|
29 |
|
|
|
(122 |
) |
Income tax (expense) benefit |
|
|
(22 |
) |
|
|
17 |
|
|
|
4 |
|
|
|
112 |
|
Net income (loss) from
continuing operations |
|
|
34 |
|
|
|
18 |
|
|
|
33 |
|
|
|
(10 |
) |
(Loss) income from discontinued
operations, net of income taxes |
|
|
(2 |
) |
|
|
219 |
|
|
|
(8 |
) |
|
|
(15 |
) |
Net income
(loss) |
|
|
32 |
|
|
|
237 |
|
|
|
25 |
|
|
|
(25 |
) |
Net income attributable to
non-controlling interests |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
Net income (loss)
attributable to Pactiv Evergreen Inc.common
shareholders |
|
$ |
31 |
|
|
$ |
236 |
|
|
$ |
23 |
|
|
$ |
(27 |
) |
Earnings (loss) per share
attributable to Pactiv Evergreen Inc.common
shareholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From continuing operations - basic & diluted |
|
$ |
0.19 |
|
|
$ |
0.10 |
|
|
$ |
0.17 |
|
|
$ |
(0.08 |
) |
From discontinued operations - basic & diluted |
|
$ |
(0.02 |
) |
|
$ |
1.23 |
|
|
$ |
(0.04 |
) |
|
$ |
(0.10 |
) |
Total - basic & diluted |
|
$ |
0.17 |
|
|
$ |
1.33 |
|
|
$ |
0.13 |
|
|
$ |
(0.18 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding - basic |
|
|
177.5 |
|
|
|
176.8 |
|
|
|
177.4 |
|
|
|
146.2 |
|
Weighted-average shares outstanding - diluted |
|
|
177.9 |
|
|
|
176.9 |
|
|
|
177.7 |
|
|
|
146.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pactiv Evergreen
Inc.Consolidated Balance
Sheets(in
millions)(unaudited)
|
|
As ofDecember 31, 2021 |
|
|
As ofDecember 31, 2020 |
|
Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
197 |
|
|
$ |
458 |
|
Accounts receivable, net |
|
|
474 |
|
|
|
375 |
|
Related party receivables |
|
|
48 |
|
|
|
55 |
|
Inventories |
|
|
854 |
|
|
|
784 |
|
Other current assets |
|
|
127 |
|
|
|
175 |
|
Assets held for sale |
|
|
162 |
|
|
|
26 |
|
Total current
assets |
|
|
1,862 |
|
|
|
1,873 |
|
Property, plant and equipment, net |
|
|
1,786 |
|
|
|
1,685 |
|
Operating lease right-of-use assets, net |
|
|
278 |
|
|
|
260 |
|
Goodwill |
|
|
1,812 |
|
|
|
1,760 |
|
Intangible assets, net |
|
|
1,127 |
|
|
|
1,092 |
|
Deferred income taxes |
|
|
7 |
|
|
|
7 |
|
Other noncurrent assets |
|
|
149 |
|
|
|
166 |
|
Total
assets |
|
$ |
7,021 |
|
|
$ |
6,843 |
|
Liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
364 |
|
|
$ |
313 |
|
Related party payables |
|
|
10 |
|
|
|
10 |
|
Current portion of long-term debt |
|
|
30 |
|
|
|
15 |
|
Current portion of operating lease liabilities |
|
|
61 |
|
|
|
57 |
|
Income taxes payable |
|
|
8 |
|
|
|
10 |
|
Accrued and other current liabilities |
|
|
315 |
|
|
|
322 |
|
Liabilities held for sale |
|
|
31 |
|
|
|
12 |
|
Total current
liabilities |
|
|
819 |
|
|
|
739 |
|
Long-term debt |
|
|
4,220 |
|
|
|
3,965 |
|
Long-term operating lease liabilities |
|
|
229 |
|
|
|
217 |
|
Deferred income taxes |
|
|
246 |
|
|
|
193 |
|
Long-term employee benefit obligations |
|
|
79 |
|
|
|
519 |
|
Other noncurrent liabilities |
|
|
140 |
|
|
|
136 |
|
Total
liabilities |
|
$ |
5,733 |
|
|
$ |
5,769 |
|
Total equity attributable
to Pactiv Evergreen Inc. common shareholders |
|
|
1,284 |
|
|
|
1,071 |
|
Non-controlling interests |
|
|
4 |
|
|
|
3 |
|
Total
equity |
|
|
1,288 |
|
|
|
1,074 |
|
Total liabilities and
equity |
|
$ |
7,021 |
|
|
$ |
6,843 |
|
|
|
Pactiv Evergreen
Inc.Consolidated Statements of Cash
Flows(in
millions)(unaudited)
|
|
For the Year Ended December 31, |
|
|
|
2021 |
|
|
2020 |
|
Cash provided by operating activities |
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
25 |
|
|
$ |
(25 |
) |
Adjustments to reconcile net
income (loss) to operating cash flows: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
344 |
|
|
|
467 |
|
Deferred income taxes |
|
|
(27 |
) |
|
|
18 |
|
Unrealized losses (gains) on derivatives |
|
|
7 |
|
|
|
(10 |
) |
Goodwill impairment charges |
|
|
— |
|
|
|
6 |
|
Other asset impairment charges |
|
|
— |
|
|
|
18 |
|
Gain on disposal of businesses and other assets |
|
|
— |
|
|
|
(10 |
) |
Non-cash portion of employee benefit obligations |
|
|
(95 |
) |
|
|
(59 |
) |
Non-cash portion of operating lease expense |
|
|
77 |
|
|
|
96 |
|
Amortization of OID and DIC |
|
|
5 |
|
|
|
17 |
|
Loss on extinguishment of debt |
|
|
2 |
|
|
|
68 |
|
Equity based compensation |
|
|
11 |
|
|
|
2 |
|
Other non-cash items, net |
|
|
(2 |
) |
|
|
19 |
|
Change in assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable, net |
|
|
(77 |
) |
|
|
33 |
|
Inventories |
|
|
(8 |
) |
|
|
(64 |
) |
Other current assets |
|
|
(2 |
) |
|
|
(2 |
) |
Accounts payable |
|
|
50 |
|
|
|
32 |
|
Operating lease payments |
|
|
(75 |
) |
|
|
(93 |
) |
Income taxes payable/receivable |
|
|
41 |
|
|
|
(58 |
) |
Accrued and other current liabilities |
|
|
(13 |
) |
|
|
(80 |
) |
Employee benefit obligation contributions |
|
|
(6 |
) |
|
|
(128 |
) |
Other assets and liabilities |
|
|
4 |
|
|
|
6 |
|
Net cash provided by
operating activities |
|
|
261 |
|
|
|
253 |
|
Cash used in investing
activities |
|
|
|
|
|
|
|
|
Acquisition of property, plant and equipment and intangible
assets |
|
|
(282 |
) |
|
|
(410 |
) |
Proceeds from sale of property, plant and equipment |
|
|
1 |
|
|
|
48 |
|
Acquisition of business, net of cash acquired |
|
|
(374 |
) |
|
|
— |
|
Disposal of businesses, net of cash disposed |
|
|
(6 |
) |
|
|
8 |
|
Insurance recoveries |
|
|
3 |
|
|
|
— |
|
Net cash used in
investing activities |
|
|
(658 |
) |
|
|
(354 |
) |
Cash provided by (used
in) financing activities |
|
|
|
|
|
|
|
|
Long-term debt proceeds |
|
|
1,510 |
|
|
|
7,861 |
|
Long-term debt repayments |
|
|
(1,280 |
) |
|
|
(8,944 |
) |
Deferred financing transaction costs on long-term debt |
|
|
(6 |
) |
|
|
(49 |
) |
Net proceeds from issuance of shares |
|
|
— |
|
|
|
569 |
|
Premium on redemption of long-term debt |
|
|
(1 |
) |
|
|
(34 |
) |
Dividends paid to common shareholders |
|
|
(71 |
) |
|
|
— |
|
Cash held by Reynolds Consumer Products and Graham Packaging
Company at time of distribution |
|
|
— |
|
|
|
(110 |
) |
Other financing activities |
|
|
(5 |
) |
|
|
(4 |
) |
Net cash provided by
(used in) financing activities |
|
|
147 |
|
|
|
(711 |
) |
Effect of exchange rate changes
on cash, cash equivalents and restricted cash |
|
|
(4 |
) |
|
|
(14 |
) |
Decrease in cash, cash equivalents and restricted cash |
|
|
(254 |
) |
|
|
(826 |
) |
Cash, cash equivalents and restricted cash as of beginning of the
year(1) |
|
|
468 |
|
|
|
1,294 |
|
Cash, cash equivalents
and restricted cash as of end of the
year(1) |
|
$ |
214 |
|
|
$ |
468 |
|
(1) includes $17 million, $10 million and $139 million and of
cash and cash equivalents and restricted cash classified as current
assets held for sale or distribution as of December 31, 2021,
December 31, 2020 and December 31, 2019, respectively.
Pactiv Evergreen
Inc.Reconciliation of Reportable Segment Net
Revenues to Total Net Revenues(in
millions)(unaudited)
|
|
For the Three Months EndedDecember
31, |
|
|
For the Year EndedDecember
31, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Reportable segment net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foodservice |
|
$ |
722 |
|
|
$ |
460 |
|
|
$ |
2,341 |
|
|
$ |
1,811 |
|
Food merchandising |
|
|
410 |
|
|
|
350 |
|
|
|
1,531 |
|
|
|
1,396 |
|
Beverage merchandising |
|
|
412 |
|
|
|
363 |
|
|
|
1,559 |
|
|
|
1,469 |
|
Other |
|
|
21 |
|
|
|
27 |
|
|
|
102 |
|
|
|
114 |
|
Inter-segment revenues |
|
|
(38 |
) |
|
|
(25 |
) |
|
|
(96 |
) |
|
|
(101 |
) |
Total net
revenues |
|
$ |
1,527 |
|
|
$ |
1,175 |
|
|
$ |
5,437 |
|
|
$ |
4,689 |
|
|
|
Pactiv Evergreen
Inc.Reconciliation of Reportable Segment Adjusted
EBITDA from Continuing Operations to Total Adjusted EBITDA from
Continuing Operations(in
millions)(unaudited)
|
|
For the Three Months EndedDecember
31, |
|
|
For the Year EndedDecember
31, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Reportable segment Adjusted EBITDA from continuing
operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foodservice |
|
$ |
104 |
|
|
$ |
71 |
|
|
$ |
291 |
|
|
$ |
241 |
|
Food merchandising |
|
|
69 |
|
|
|
66 |
|
|
|
232 |
|
|
|
252 |
|
Beverage merchandising |
|
|
45 |
|
|
|
36 |
|
|
|
44 |
|
|
|
148 |
|
Other |
|
|
1 |
|
|
|
2 |
|
|
|
7 |
|
|
|
8 |
|
Unallocated |
|
|
(14 |
) |
|
|
(5 |
) |
|
|
(43 |
) |
|
|
(34 |
) |
Total Adjusted EBITDA
from continuing operations (Non-GAAP) |
|
$ |
205 |
|
|
$ |
170 |
|
|
$ |
531 |
|
|
$ |
615 |
|
|
|
Pactiv Evergreen
Inc.Reconciliation of Net Income (Loss) from
Continuing Operations to Adjusted EBITDA from Continuing
Operations(in
millions)(unaudited)
|
|
For the Three Months EndedDecember
31, |
|
|
For the Year EndedDecember
31, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Net income (loss) from continuing operations
(GAAP) |
|
$ |
34 |
|
|
$ |
18 |
|
|
$ |
33 |
|
|
$ |
(10 |
) |
Income tax expense
(benefit) |
|
|
22 |
|
|
|
(17 |
) |
|
|
(4 |
) |
|
|
(112 |
) |
Interest expense, net |
|
|
50 |
|
|
|
96 |
|
|
|
191 |
|
|
|
371 |
|
Depreciation and
amortization |
|
|
91 |
|
|
|
76 |
|
|
|
344 |
|
|
|
289 |
|
Restructuring, asset impairment
and other related charges(1) |
|
|
1 |
|
|
|
10 |
|
|
|
9 |
|
|
|
28 |
|
Gain on sale of business and
noncurrent assets(2) |
|
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
(1 |
) |
Non-cash pension income(3) |
|
|
(13 |
) |
|
|
(16 |
) |
|
|
(101 |
) |
|
|
(71 |
) |
Operational process engineering
related consultancy costs(4) |
|
|
5 |
|
|
|
1 |
|
|
|
21 |
|
|
|
13 |
|
Business acquisition costs and
purchase accounting adjustments(5) |
|
|
13 |
|
|
|
— |
|
|
|
15 |
|
|
|
— |
|
Unrealized losses (gains) on
derivatives(6) |
|
|
2 |
|
|
|
(7 |
) |
|
|
7 |
|
|
|
(10 |
) |
Foreign exchange losses on
cash(7) |
|
|
1 |
|
|
|
1 |
|
|
|
2 |
|
|
|
15 |
|
Executive transition
charges(8) |
|
|
— |
|
|
|
— |
|
|
|
10 |
|
|
|
— |
|
Goodwill impairment
charges(9) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6 |
|
Related party management
fee(10) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
49 |
|
Strategic review and
transaction-related costs(11) |
|
|
— |
|
|
|
8 |
|
|
|
— |
|
|
|
47 |
|
Other |
|
|
(1 |
) |
|
|
2 |
|
|
|
4 |
|
|
|
1 |
|
Adjusted EBITDA from
continuing operations (Non-GAAP) |
|
$ |
205 |
|
|
$ |
170 |
|
|
$ |
531 |
|
|
$ |
615 |
|
(1) Reflects asset impairment,
restructuring and other related charges (net of reversals)
primarily associated with the closure of Beverage Merchandising’s
coated groundwood operations, our corporate operations and the
remaining closures businesses that are not reported within
discontinued operations. (2) Reflects the gain or loss
from the sale of businesses and noncurrent
assets. (3) Reflects the non-cash pension income related
to our employee benefit plans. (4) Reflects the costs
incurred to evaluate and improve the efficiencies of our
manufacturing and distribution operations. (5) Reflects
$3 million of acquisition costs related to Fabri-Kal and a $12
million inventory fair value step-up that was expensed within cost
of sales during 2021. (6) Reflects the mark-to-market
movements in our commodity derivatives. (7) Reflects
foreign exchange losses on cash, primarily on U.S. dollar amounts
held in non-U.S. dollar functional currency
entities. (8) Reflects charges relating to key executive
retirement and separation agreements during
2021. (9) Reflects goodwill impairment charges in respect
of our remaining closures operations. (10) Reflects the
related party management fee charged by Rank Group Limited to us
and the fee to terminate this arrangement upon our initial public
offering, or IPO. Following our IPO, the Company is no longer
charged the related party management fee. (11) Reflects
costs incurred for strategic reviews of our businesses, primarily
in anticipation of and in connection with the IPO, as well as other
costs related to the IPO that cannot be offset against the proceeds
of the IPO.
________________________________________1
Adjusted EBITDA is a non-GAAP measure. Refer to its definition in
the discussion on non-GAAP financial measures and the accompanying
reconciliation below.
2 The Company is unable to provide a
reconciliation of forward-looking Adjusted EBITDA from continuing
operations without unreasonable effort because of the uncertainty
and potential variability in amount and timing of gains or losses
on the sale of businesses and noncurrent assets, non-cash pension
income or expense, unrealized gains or losses on derivatives and
foreign exchange gains or losses on cash, which are reconciling
items between GAAP net income (loss) from continuing operations and
Adjusted EBITDA from continuing operations and could significantly
impact GAAP results.
Contact:Dhaval
Patel732.501.9657dhaval.patel@pactivevergreen.com
Pactiv Evergreen (NASDAQ:PTVE)
Historical Stock Chart
From Jun 2024 to Jul 2024
Pactiv Evergreen (NASDAQ:PTVE)
Historical Stock Chart
From Jul 2023 to Jul 2024