Berry Global Group, Inc. (NYSE:BERY) today reported its fourth
quarter and fiscal year 2018 results, referred to in the following
as the September 2018 quarter and fiscal year 2018.
Fourth Quarter Highlights(all
comparisons made to the September 2017 quarter)
- Net sales increased 9 percent to $2.1
billion
- Organic sales growth, excluding
currency and acquisition effects, up 3 percent
- Operating income down 3 percent to $194
million
- Operating EBITDA down 1 percent to $346
million
- Net income per diluted share up 22
percent to $0.99
- Adjusted net income per diluted share
up 3 percent to $0.90
- Cash flow from operations increased by
13 percent to $448 million
- Adjusted free cash flow increased by 37
percent to $382 million
- Completed the strategic acquisition of
Laddawn, Inc.
Fiscal Year Highlights(all comparisons
made to fiscal year 2017)
- Net sales increased 11 percent to an
annual record of $7.9 billion
- Organic sales, excluding currency and
acquisition effects, increased 1 percent
- Operating income up 4 percent to $761
million
- Operating EBITDA up 4 percent to $1,380
million
- Net income per diluted share up 43
percent to $3.67
- Adjusted net income per diluted share
up 10 percent to $3.37
- Cash flow from operations increased by
3 percent to $1,004 million
- Adjusted free cash flow increased by 5
percent to $634 million
- Expect fiscal year 2019 cash flow from
operations of $1.04 billion and adjusted free cash flow of $670
million
Commenting on the quarter, Tom Salmon, Chairman and Chief
Executive Officer of Berry stated, “Net sales increased 9 percent
to $2.1 billion, compared to the prior year quarter. Additionally,
we generated quarterly and annual records for free cash flow of
$382 million and $634 million, respectively."
“Specifically by segment, our Consumer Packaging division
delivered strong organic sales growth of 8 percent in the quarter,
which was led by our foodservice products. These results were
driven by stronger demand at quick service restaurants and
convenience stores along with stronger overall end market demand
for certain products. Within our Health, Hygiene & Specialties
division we recorded strong quarterly sales growth of 21 percent as
well as a 16 percent improvement in Operating EBITDA, including the
impact of the recently completed acquisition of Clopay. Inside our
Engineered Materials division, we successfully completed the
acquisition of Laddawn, which enhances our ability to service the
faster growing small and medium size customer base.”
Mr. Salmon continued, “As we disclosed last quarter, our Board
of Directors approved a new $500 million share repurchase program.
In our fiscal 2019 first quarter, we expect to continue to execute
on our share repurchase plan given the current attractive market
conditions and valuation.”
September 2018 Quarter
Results
Consolidated Overview September
Quarter (in millions
of dollars)
Current Prior
$ Change % Change Net sales
$2,054 $1,881 $173
9 % Operating income
194 199 (5) (3)%
The net sales increase of $173 million from the prior year
quarter was primarily attributed to acquisition net sales of 7
percent and organic sales growth of 3 percent partially offset by a
small negative impact from foreign currency changes.
The operating income decrease of $5 million from the prior year
quarter was primarily attributed to a $33 million negative impact
from under recovery of higher cost of goods sold partially offset
by a $10 million decrease in selling, general, and administrative
expense, due to synergies and cost reductions; and acquisition
operating income of $8 million, a $7 million decrease in
depreciation and amortization expense, and a $5 million decrease in
business integration expenses.
Fiscal Year 2018 Results
Consolidated Overview Fiscal
Year (in millions of
dollars)
2018 2017 $
Change % Change Net sales
$7,869
$7,095 $774 11% Operating
income
761 732 29 4%
The net sales growth of $774 million is primarily attributed to
acquisition net sales of $624 million, organic sales growth of $92
million, and a $58 million favorable impact from foreign currency
changes. The organic sales growth is primarily attributed to
increased selling prices of $191 million due to the pass through of
higher cost of goods sold, partially offset by a modest 1% volume
decline.
The operating income increase of $29 million is primarily
attributed to acquisition operating income of $62 million, a $46
million decrease in selling, general and administrative expense
related to synergies and lower incentive compensation, a $26
million decrease in depreciation and amortization, and an $11
million favorable impact from foreign currency changes. These
improvements were partially offset by a $96 million negative impact
from under recovery of higher cost of goods sold, and a $12 million
impact from the lower volumes.
Engineered Materials Fiscal
Year (in millions of
dollars)
2018 2017 $
Change % Change Net sales
$2,672
$2,375 $ 297 13%
Operating income
368 316 52 16%
Net sales in the Engineered Materials segment grew by $297
million primarily attributed to acquisition net sales of $319
million, partially offset by an organic sales decline of $29
million. The organic sales decline is primarily related to
increased selling prices of $54 million, being more than offset by
a 3% volume decline as a result of business rationalizations within
legacy AEP locations.
The operating income increase of $52 million is primarily
attributed to acquisition operating income of $40 million, an $18
million decrease in depreciation and amortization expense, and an
$8 million decrease in selling, general and administrative
expenses. These improvements were partially offset by an $11
million negative impact from the lower volumes.
Health, Hygiene, & Specialties
Fiscal Year
(in millions of dollars)
2018 2017
$ Change % Change Net
sales
$2,734 $2,369 $365
15% Operating income
202 216 (14) (6)%
Net sales in the Health, Hygiene & Specialties segment grew
by $365 million primarily attributed to acquisition net sales of
$305 million, a $52 million favorable impact from foreign currency
changes, and organic sales growth of $9 million. The organic sales
growth is primarily attributed to increased selling prices of $56
million due to the pass through of higher cost of goods sold,
partially offset by a 2% volume decline.
The operating income decrease of $14 million is primarily
attributed to a $53 million negative impact from under recovery of
higher cost of goods sold, a $7 million impact from lower volumes,
and a $12 million increase in business integration. These decreases
were partially offset by a $22 million decrease in selling, general
and administrative expenses, acquisition operating income of $22
million from the Clopay acquisition, and a $10 million favorable
impact from foreign currency changes.
Consumer Packaging Fiscal Year
(in millions of dollars)
2018 2017 $ Change
% Change Net sales
$2,463
$2,351 $112 5 % Operating income
191 200 (9) (5)%
Net sales in the Consumer Packaging segment grew by $112 million
primarily attributed to organic sales growth. The organic sales
growth is primarily attributed to increased selling prices of $81
million due to the pass through of higher cost of goods sold and a
1% volume improvement.
The operating income decrease of $9 million is primarily
attributed to a $40 million negative impact from under recovery of
higher cost of goods sold, partially offset by a $16 million
decrease in selling, general and administrative expenses, a $6
million favorable impact from the volume improvement, and a $6
million decrease in business integration expense.
Cash Flow and Capital
Structure
Our cash flow from operating activities was $448 million for the
September 2018 quarter and $1,004 million for fiscal year 2018. The
Company’s adjusted free cash flow for the September 2018 quarter
was $382 million, a 37 percent increase compared to the prior year
quarter of $278 million. The Company’s adjusted free cash flow for
fiscal year 2018 was a fiscal year record of $634 million.
Our total debt less cash and cash equivalents at the end of the
September 2018 quarter was $5,463 million. Adjusted EBITDA for the
four quarters ended September 29, 2018 was $1,449 million.
Share Repurchase Program
In the June 2018 quarter, the Company announced that its Board
had unanimously approved a new $500 million share repurchase
program. The new share repurchase authorization allows for the
repurchase of shares, from time to time, through open market
purchases, privately negotiated transactions, Rule 10b5-1 plans,
and any other purchase techniques deemed appropriate in accordance
with applicable securities laws. The timing and amount of
repurchases will depend on market conditions. The share repurchase
program has no expiration date. The Company repurchased $35 million
of shares outstanding during the September 2018 quarter. In our
fiscal 2019 first quarter, we expect to continue to execute on our
share repurchase plan given attractive market conditions and
compelling valuations.
Outlook
We anticipate our fiscal year 2019 cash flow from operations and
adjusted free cash flow to be $1.04 billion and $670 million,
respectively. Our estimate assumes constant currency rates from the
end of fiscal 2018 and a normal inflationary environment on our
costs. Additionally, our fiscal 2019 capital spending and cash
interest costs are forecasted to be $350 million and $270 million,
respectively. Within our adjusted free cash flow guidance, we are
also assuming cash taxes to be $165 million in fiscal 2019,
including a $16 million payment in the first fiscal quarter under
the Company’s tax receivable agreement, along with working capital
and other cash uses of $45 million.
Investor Conference Call
The Company will host a conference call today, November 15,
2018, at 10 a.m. Eastern Time to discuss its fourth quarter and
fiscal year 2018 results. The telephone number to access the
conference call is (800) 305-1078 (domestic), or (703) 639-1173
(international), conference ID 2388109. We expect the call to last
approximately one hour. Interested parties are invited to listen to
a live webcast and view the accompanying
slides by visiting the Company’s Investor page at
www.berryglobal.com. A replay of the conference call can also be
accessed on the Investor page of the website beginning November 15,
2018, at 1 p.m. Eastern Time, to December 6, 2018, by calling (855)
859-2056 (domestic), or (404) 537-3406 (international), access code
2388109.
About Berry
Berry Global Group, Inc. (NYSE:BERY), headquartered in
Evansville, Indiana, is committed to its mission of ‘Always
Advancing to Protect What’s Important,’ and proudly partners with
its customers to provide them with value-added protective
solutions. The Company is a leading global supplier of a broad
range of innovative non-woven, flexible, and rigid products used
every day within consumer and industrial end markets. Berry, a
Fortune 500 company, generated $7.9 billion of sales in fiscal
2018. For additional information, visit Berry’s website at
www.berryglobal.com.
Non-GAAP Financial
Measures
This press release includes non-GAAP financial measures such as
operating EBITDA, adjusted EBITDA, adjusted net income, adjusted
free cash flow, and organic sales growth. A reconciliation of these
non-GAAP financial measures to comparable measures determined in
accordance with accounting principles generally accepted in the
United States of America (GAAP) is set forth at the end of this
press release.
Forward Looking
Statements
Statements in this release that are not historical, including
statements relating to the expected future performance of the
Company, are considered “forward looking” and are presented
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. You can identify forward-looking
statements because they contain words such as “believes,”
“expects,” “may,” “will,” “should,” “would,” “could,” “seeks,”
“approximately,” “intends,” “plans,” “estimates,” “anticipates,”
“outlook,” or “looking forward,” or similar expressions that relate
to our strategy, plans, or intentions. All statements we make
relating to our estimated and projected earnings, margins, costs,
expenditures, cash flows, growth rates, and financial results or to
our expectations regarding future industry trends are
forward-looking statements. In addition, we, through our senior
management team, from time to time make forward-looking public
statements concerning our expected future operations and
performance and other developments. These forward-looking
statements are subject to risks and uncertainties that may change
at any time, and, therefore, our actual results may differ
materially from those that we expected.
Important factors that could cause actual results to differ
materially from our expectations, which we refer to as cautionary
statements, are disclosed under “Risk Factors” and elsewhere in our
Annual Report on Form 10-K and subsequent filings with the
Securities and Exchange Commission, including, without limitation,
in conjunction with the forward-looking statements included in this
release. All forward-looking information and subsequent written and
oral forward-looking statements attributable to us, or to persons
acting on our behalf, are expressly qualified in their entirety by
the cautionary statements. Some of the factors that we believe
could affect our results include: (1) risks associated with our
substantial indebtedness and debt service; (2) changes in prices
and availability of resin and other raw materials and our ability
to pass on changes in raw material prices on a timely basis; (3)
the impact of potential changes in interest rates: (4) performance
of our business and future operating results; (5) risks related to
our acquisition strategy and integration of acquired businesses;
(6) reliance on unpatented know-how and trade secrets; (7)
increases in the cost of compliance with laws and regulations,
including environmental, safety, and production and product laws
and regulations; (8) risks related to disruptions in the overall
economy and the financial markets may adversely impact our
business; (9) catastrophic loss of one of our key manufacturing
facilities, natural disasters, and other unplanned business
interruptions; (10) risks of competition, including foreign
competition, in our existing and future markets;(11) general
business and economic conditions, particularly an economic
downturn; (12) potential failure to realize the intended benefits
from recent acquisitions including, without limitation, the
inability to realize the anticipated cost synergies in the
anticipated amounts or within the contemplated timeframes or cost
expectations, the inability to realize the anticipated revenues,
expenses, earnings and other financial results, and growth and
expansion of the company’s operations, and the anticipated tax
treatment; (13) risks related to international business, including
foreign currency exchange rate risk and the risks of compliance
with applicable export controls, sanctions, anti-corruption laws
and regulations, (14) the ability of our insurance to fully cover
potential exposures and (15) the other factors discussed under the
heading “Risk Factors” in our Annual Report on Form 10-K and
subsequent filings with the Securities and Exchange Commission. We
caution you that the foregoing list of important factors may not
contain all of the material factors that are important to you.
Accordingly, readers should not place undue reliance on those
statements. All forward-looking statements are based upon
information available to us on the date of this release. We
undertake no obligation to publicly update or revise any
forward-looking statement as a result of new information, future
events or otherwise, except as otherwise required by law.
Berry Global Group,
Inc.Consolidated Statements of Income(Unaudited)(in
millions of dollars, except per share data amounts)
Quarterly Period Ended Fiscal
Year Ended
September 29,2018
September 30,2017
September 29,2018
September 30,2017
Net sales
$ 2,054 $ 1,881
$
7,869 $ 7,095 Costs and expenses: Cost of goods sold
1,705 1,514
6,438 5,691 Selling, general and
administrative
114 121
480 494 Amortization of
intangibles
38 41
154 154 Restructuring and
impairment charges
3 6
36 24 Operating income
194 199
761 732 Other expense (income), net
8 (4 )
25 14 Interest expense, net
64
66
259 269 Income before
income taxes
122 137
477 449 Income tax expense
(benefit)
(11 ) 27
(19 ) 109 Net income
$
133 $ 110
$ 496 $
340 Net income per share: Basic
$ 1.01 $ 0.84
$ 3.77 $ 2.66 Diluted
0.99 0.81
3.67
2.56 Outstanding weighted-average shares: (in millions)
Basic
131.7 130.6
131.4 127.6 Diluted
134.9
135.7
135.2 132.6
Consolidated Statements of
Comprehensive Income(Unaudited)(in millions of dollars)
Quarterly Period Ended Fiscal
Year Ended
September 29,2018
September 30,2017
September 29,2018
September 30,2017
Net income
$ 133 $ 110
$ 496 $ 340
Currency translation
(18 ) 30
(127 ) 34
Pension and other postretirement benefits
4 25
3 38
Interest rate hedges
2 5
49 28 Provision for income
taxes
— (12 )
(13
) (20 ) Other comprehensive income, net of tax
(12 ) 48
(88 )
80 Comprehensive income
$ 121 $
158
$ 408 $ 420
Berry Global Group,
Inc.Condensed Consolidated Balance Sheets(Unaudited)(in
millions of dollars)
September 29,2018
September 30,2017
Assets: Cash and cash equivalents
$ 381 $ 306
Accounts receivable, net
941 847 Inventories
887 762
Other current assets
76 89 Property, plant, and equipment,
net
2,488 2,366 Goodwill, intangible assets, and other
long-term assets
4,358 4,106
Total assets
$ 9,131 $ 8,476
Liabilities and stockholders' equity: Current liabilities,
excluding debt
$ 1,199 $ 1,101 Current and long-term
debt
5,844 5,641 Other long-term liabilities
654 719
Stockholders’ equity
1,434 1,015
Total liabilities and stockholders' equity
$ 9,131
$ 8,476
Current and Long-Term Debt
September 29,2018
September 30,2017
(in millions of dollars) Revolving line of credit
$
— $ — Term loans
3,652 3,957 5½% Second priority
notes
500 500 6 % Second priority notes
400 400 5⅛ %
Second priority notes
700 700 4½ % Second priority notes
500 — Debt discounts and deferred fees
(43 )
(48 ) Capital leases and other
135 132
Total debt
$ 5,844 $ 5,641
Berry Global Group,
Inc.Condensed Consolidated Statements of Cash
Flows(Unaudited)(in millions of dollars)
Fiscal Year Ended
September 29,2018
September 30,2017
Cash flows from operating activities: Net income
$ 496 $ 340 Depreciation
384 367 Amortization
of intangibles
154 154 Other, net
(13 ) 59
Working capital
(17 ) 55 Net
cash from operating activities
1,004 975
Cash
flows from investing activities: Additions to property, plant,
and equipment
(336 ) (269 ) Proceeds from sale of
assets
3 6 Other investing activities, net — 4 Acquisitions
of businesses, net of cash acquired
(702 )
(515 ) Net cash from investing activities
(1,035
) (774 )
Cash flows from financing activities:
Proceeds from long-term borrowings
498 495 Repayments on
long-term borrowings
(335 ) (636 ) Proceeds from
issuance of common stock
23 31 Repurchase of common stock
(33 ) — Debt financing costs
(3 ) (5 )
Payment of tax receivable agreement
(37 )
(111 ) Net cash from financing activities
113
(226 ) Effect of exchange rate changes on cash
(7 ) 8 Net change in cash
75 (17 ) Cash and
cash equivalents at beginning of period
306
323 Cash and cash equivalents at end of period
$ 381 $ 306
Berry Global Group,
Inc.Condensed Consolidated Financial
StatementsSegment Information(Unaudited)(in millions of
dollars)
Quarterly Period Ended September 29,
2018
ConsumerPackaging
Health, Hygiene &
Specialties
EngineeredMaterials
Total Net sales
$ 648 $
724 $ 682 $ 2,054
Operating income
$ 40 $ 62 $
92 $ 194 Depreciation and amortization
60 54 27 141 Restructuring and
impairment charges
— 2 1 3 Other
non-cash charges (1)
— — 1 1 Business
optimization costs (2)
1 5
1 7 Operating EBITDA
$ 101
$ 123 $ 122 $ 346
Quarterly Period Ended September 30, 2017
ConsumerPackaging
Health, Hygiene& Specialties
EngineeredMaterials
Total Net sales $ 599 $ 596 $ 686 $ 1,881 Operating income $
50 $ 52 $ 97 $ 199 Depreciation and amortization 57 48 33 138
Restructuring and impairment charges 2 3 1 6 Other non-cash charges
(1) 2 2 2 6 Business optimization costs (2) — 1
— 1 Operating EBITDA $ 111 $ 106 $ 133 $ 350
(1) Other non-cash charges primarily includes $4 million of
stock compensation expense and other non-cash charges for both the
September 2018 and 2017 quarters, respectively. (2) Includes
integration expenses and other business optimization costs.
Berry Global Group,
Inc.Condensed Consolidated Financial
StatementsSegment Information(Unaudited)(in millions of
dollars)
Fiscal Year Ended September 29, 2018
ConsumerPackaging
Health, Hygiene &
Specialties
EngineeredMaterials
Total Net sales
$ 2,463 $
2,734 $ 2,672 $ 7,869
Operating income
$ 191 $ 202 $
368 $ 761 Depreciation and amortization
229 200 109 538 Restructuring and
impairment charges
3 28 5 36 Other
non-cash charges (1)
7 11 10 28
Business optimization costs (2)
1 11
5 17 Operating EBITDA
$
431 $ 452 $ 497 $
1,380 Fiscal Year Ended September 30,
2017
ConsumerPackaging
Health, Hygiene& Specialties
EngineeredMaterials
Total Net sales $ 2,351 $ 2,369 $ 2,375 $ 7,095 Operating
income $ 200 $ 216 $ 316 $ 732 Depreciation and amortization 231
184 106 521 Restructuring and impairment charges 8 11 5 24 Other
non-cash charges (1) 10 12 12 34 Business optimization costs (2)
— 11 5 16 Operating EBITDA $ 449 $ 434
$ 444 $ 1,327 (1) Other non-cash charges for the
fiscal year ended September 29, 2018 includes $23 million of stock
compensation expense, a $5 million inventory step up charge related
to acquisitions and other non-cash charges. Other non-cash charges
for the fiscal year ended September 30, 2017 primarily includes $20
million of stock compensation expense, a $5 million inventory
step-up charge related to acquisitions along with other non-cash
charges. (2) Includes integration expenses and other business
optimization costs.
Berry Global Group,
Inc.Reconciliation Schedules(Unaudited)(in millions of
dollars, except per share data)
Quarterly Period Ended
Fiscal Year Ended
September 29,2018
September 30,2017
September 29,2018
September 30,2017
Net income $ 133 $ 110
$
496 $ 340 Add: other expense (income), net
8 (4 )
25 14 Add: interest expense, net
64 66
259 269
Add: income tax (benefit) expense
(11 )
27
(19 ) 109
Operating
income $ 194 $ 199
$ 761 $ 732
Add: non-cash amortization from 2006 private sale
7 8
28 32 Add: restructuring and impairment
3 6
36
24 Add: other non-cash charges (1)
1 6
28 34 Add:
business optimization and other expenses (2)
7
1
17 16
Adjusted operating income (10)
$ 212 $ 220
$ 870 $ 838 Add: depreciation
103 97
384 367 Add: amortization of intangibles (3)
31 33
126
122
Operating EBITDA (10)
$ 346
$ 350
$ 1,380 $ 1,327
Cash flow from operating activities
$
448 $ 395
$ 1,004 $ 975 Net additions to
property, plant, and equipment
(66 ) (66 )
(333 ) (263 ) Payment of tax receivable agreement
— (51 )
(37 )
(111 )
Adjusted free cash flow (10)
$
382 $ 278
$ 634 $ 601
Net income per diluted share
$ 0.99 $
0.81
$ 3.67 $ 2.56 Other expense (income), net
0.06 (0.03 )
0.18 0.11 Non-cash amortization from
2006 private sale
0.05 0.06
0.21 0.24 Restructuring
and impairment
0.02 0.04
0.27 0.18 Other non-cash
charges (4)
(0.02 ) 0.01
0.04 0.10 Business
optimization costs (2)
0.05 0.01
0.13 0.12 Tax reform
adjustments, net (5)
(0.21 ) — (0.92
) — Income tax impact on items above (6)
(0.04 ) (0.03 )
(0.21 )
(0.24 )
Adjusted net income per diluted share (10)
$ 0.90 $ 0.87
$ 3.37
$ 3.07
Fiscal Year Ended 2018
Operating EBITDA (10)
$ 1,380 Add:
acquisitions (7)
41 Add: unrealized cost savings (8)
28 Adjusted EBITDA (10)
$ 1,449
Estimated Fiscal 2019
Cash flow from operating activities
$ 1,036 Additions
to property, plant, and equipment
(350 ) Tax
receivable agreement payment (9)
(16 )
Adjusted free cash flow (10)
$ 670
(1) Other non-cash charges primarily includes $4
million of stock compensation expense and other non-cash charges
for both the September 2018 and 2017 quarters, respectively. For
the fiscal year ended September 29, 2018 other non-cash charges
primarily includes $23 million of stock compensation expense, a $5
million inventory step up charge related to acquisitions and other
non-cash charges. For the fiscal year ended September 30, 2017
other non-cash charges primarily includes $20 million of stock
compensation expense, a $5 million inventory step up charge related
to acquisitions and other non-cash charges. (2) Includes
integration expenses and other business optimization costs. (3)
Amortization excludes non-cash amortization from the 2006 private
sale of $7 million and $8 million for the September 2018 and
September 2017 quarters, respectively; along with $28 million and
$32 million for the fiscal years ended 2018 and 2017, respectively.
(4) Other non-cash charges excludes $4 million of stock
compensation expense for the quarters ended September 29, 2018 and
September 30, 2017, respectively. Additionally, other non-cash
charges excludes $23 million and $20 million of stock compensation
expense for the four quarters ended September 29, 2018 and
September 30, 2017, respectively. (5) Includes $124 million of net
adjustments for valuing and transition tax related to the passed
tax reform legislation. (6) Income tax effects on adjusted net
income is calculated using 25 percent for the September 2018
quarter and fiscal year and 32 percent for the September 2017
quarter and fiscal year. The rates used represents the Company’s
expected effective tax rate for each respective period. (7)
Represents Operating EBITDA for the Clopay acquisition for the
period of September 30, 2017 - February 6, 2018 and the Laddawn,
Inc. acquisition for the period of September 30, 2017 – August 24,
2018. (8) Primarily represents unrealized cost savings related to
acquisitions. (9) Includes $16 million tax receivable agreement
paid in our December 2018 quarter. (10)
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 excludes 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
these 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.
We define “adjusted free cash flow” as
cash flow from operating activities less additions to property,
plant, and equipment and payments under the tax receivable
agreement. We believe adjusted free cash flow is useful to an
investor in evaluating our liquidity because adjusted free cash
flow and similar measures are widely used by investors, securities
analysts, and other interested parties in our industry to measure a
company’s liquidity. We also believe adjusted cash flow is useful
to an investor in evaluating our liquidity as it can assist in
assessing a company’s ability to fund its growth through its
generation of cash.
Adjusted EBITDA is used by our lenders for
debt covenant compliance purposes. We also use Adjusted EBITDA and
Operating EBITDA among other measures to evaluate management
performance and in determining performance-based compensation.
Adjusted EBITDA and Operating EBITDA and similar measures are
widely used by investors, securities analysts, and other interested
parties in our industry to measure a company’s performance. We also
believe EBITDA and adjusted net income are useful to an investor in
evaluating our performance without regard to revenue and expense
recognition, which can vary depending upon accounting methods.
Berry Global Group,
Inc.Reconciliation Schedules(Unaudited)
Quarterly Period Ended September 29,
2018
ConsumerPackaging
Health, Hygiene &
Specialties
EngineeredMaterials
Total Organic sales growth
8 % 3
% (2 %) 3 % Acquisition
—
19 % 2 % 7 % Currency
effects
— (1 %) —
(1 %) Total Reported Net Sales
8 %
21 % — % 9 %
Fiscal Year 2018
ConsumerPackaging
Health, Hygiene &
Specialties
EngineeredMaterials
Total Organic sales growth
5 % —
% (1 %) 1 % Acquisition
—
13 % 14 % 9 % Currency
effects
— 2 % — %
1 % Total Reported Net Sales
5 %
15 % 13 % 11 %
Organic sales growth = volume + price/mix
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181115005212/en/
Berry Global Group, Inc.Dustin Stilwell,
1+812-306-2964IR@BerryGlobal.com
Berry Global (NYSE:BERY)
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