Sonoco Products Company · NYSE:SON
Sonoco Products — Q2 2023 Earnings Presentation
18 slides from Sonoco Products's earnings presentation, Aug 1, 2023
Slide 1: Sonoco Second Quarter 2023 Earnings Presentation
SONOCO SONOCO SECOND QUARTER 2023 Earnings Presentation | August 2023 Sonoco | www.sonoco.com
Slide 2: Forward-Looking Statements / Non-GAAP Financial Measures
Forward-Looking Statements / Non-GAAP Financial Measures Statements included herein that are not historical in nature, are intended to be, and are hereby identified as “forward-looking statements” for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amen
Slide 3: Today's Attendees
Today’s Attendees HOWARD COKER ROB DILLARD RODGER FULLER LISA WEEKS President & CEO Chief Financial Officer Chief Operating Officer VP of IR & Communications Sonoco | www.sonoco.com 3
Slide 4: Q2 2023 Results Summary
Q2 2023 Results Summary Adjusted Adjusted Adjusted REVENUE EBITDA NET INCOME* EARNINGS PER SHARE* $1.71B $275M $136M $1.38 -11% y/y 16% Margin 8% Margin HIGHLIGHTS • Strong operating performance in a volatile demand environment • Most businesses performing well; volume weakness in Consumer metal pac
Slide 5: Financial Results
Financial Results Rob Dillard Chief Financial Officer Sonoco | www.sonoco.com 5
Slide 6: Q2-23 Consolidated Financial Results
Q2-23 Consolidated Financial Results YoY % Q2-22 Q1-23 Q2-23 Change Performance Summary Net Sales ($M) $1,913 $1,730 $1,705 (11%) • Sales lower primarily from broad based volume decreases Adjusted Operating Profit ($M) $250 $213 $211 (16%) • Continue to see favorable price/cost in our Industrial and
Slide 7: Q2-23 Performance Review
Q2-23 Performance Review Sales Bridge (Year-over-Year) Sales Drivers (Dollars in millions) $1,913 • Volume/Mix: Metal Packaging and Industrial $1,705 businesses were the primary drivers of the volume Q2-22 Volume/Mix* Price decline ($190) FX/Other Q2-23 ($15) ($3) *Includes the exit of the corrugate
Slide 8: Q2-23 Segment Results
Q2-23 Segment Results Segment Operating Profit Net Sales Operating OP Bridge Drivers (Y/Y) Profit as % of Sales Y/Y Y/Y $M Y/Y Change $M % Change Change CONSUMER $924 (7%) $95 (32%) 10.3% (377 bps) • Negative price / cost driven by the prior year’s metal price overlap, otherwise positive • Volumes d
Slide 9: Capital Allocation
Capital Allocation Capital Allocation Framework is Aligned to Business Strategy to Drive Value Creation for Shareholders Capital Allocation Priorities Operating Cash Flow ($M) 251 Cash Flow from Operations 183 187 138 (37) 79 1 98 118 Capital Expenditures to support ongoing business and drive growth
Slide 10: 2023 Revised Financial Outlook
2023 Revised Financial Outlook Summary $ in Millions (except EPS) 2023 Guidance • Lowered ranges of Adjusted EBITDA and EPS guidance reflect Q2 results and expected continued lower volume for the balance of the Adjusted EBITDA $1,020 - $1,070 year • Focused on Price / Cost, productivity, and cost Ad
Slide 11: Q3-23 Segment Outlook
Q3-23 Segment Outlook CONSUMER PACKAGING INDUSTRIAL PAPER PACKAGING ALL OTHER BUSINESSES • Continued strong performance in • Volume to decline sequentially from • Stable demand across the global rigid paper containers and the second quarter and remain soft portfolio, with positive flexibles in Q3 gl
Slide 12: Closing Remarks
Closing Remarks Howard Coker President and Chief Executive Officer Sonoco | www.sonoco.com 12
Slide 13: Looking Ahead in 2023 and Beyond
Looking Head in 2023 and Beyond We are continuing to transform • Building a funnel of accretive acquisitions the company through portfolio management and M&A • Non-core divestitures timed for maximum value We have increasing opportunity • Industrial margins strong at lower volumes to leverage our op
Slide 14: Appendix
Appendix Sonoco | www.sonoco.com 14
Slide 15: EPS Summary 2023 Vs. 2022
EPS Summary 2023 Vs. 2022 Second Quarter Year To Date 2023 2022 2023 2022 GAAP EPS $ 1.16 $ 1.33 $ 2.66 $ 2.50 Addback for: Acquisition related costs, net 0.03 0.09 0.08 0.47 LIFO Reserve change (0.01) 0.05 (0.05) 0.19 Acquisition intangibles amortization expense 0.16 0.16 0.32 0.30 Restructuring, n
Slide 16: P&L Summary (Adjusted) 2nd Quarter: 2023 Vs. 2022
P&L Summary (Adjusted) 2nd Quarter: 2023 Vs. 2022 (Dollars in millions) Better / (Worse) 2023 2022 $ % Net sales $ 1,705 $ 1,913 $ (208) (10.9)% Gross profit 356 401 (46) (11.4) % SG&A Expenses, net of Other Income (145) (151) 7 4.3 % Operating profit $ 211 $ 250 $ (39) (15.7)% Net interest (32) (23
Slide 17: P&L Summary (Adjusted) Year to Date: 2023 Vs. 2022
P&L Summary (Adjusted) 2nd Quarter Year to date: 2023 Vs. 2022 (Dollars in millions) Better / (Worse) 2023 2022 $ % Net sales $ 3,435 $ 3,684 $ (249) (6.8)% Gross profit 725 817 (92) (11.3) % SG&A Expenses, net of Other Income (300) (306) 6 1.9 % Operating Profit $ 424 $ 511 $ (87) (16.9)% Net inter
Slide 18: Balance Sheet
Balance Sheet (Dollars in millions) 7/2/2023 12/31/2022 Change $ Cash and cash equivalents $ 319 $ 227 $ 92 Trade accounts receivable, net of allowances 888 863 25 Other receivables 122 99 23 Inventories 943 1,096 (153) Prepaid expenses 88 76 12 Current Assets $ 2,360 $ 2,361 $ (1) Property, plant a
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