Greif, Inc. GEF reported adjusted earnings per share of 39 cents for first-quarter fiscal 2025, missing the Zacks Consensus Estimate of 72 cents. The bottom line decreased 69.3% year over year as higher raw material costs as well as selling, general and administrative expenses offset the gain from improved revenues.
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Including one-time items, EPS was 22 cents in the quarter compared with $1.75 in the prior-year quarter.
Greif, Inc. Price, Consensus and EPS Surprise
Greif, Inc. price-consensus-eps-surprise-chart | Greif, Inc. Quote
Greif’s Revenues & Margins Up Y/Y in Q1
Revenues moved up 5% year over year to $1.27 billion. However, the top line missed the Zacks Consensus Estimate of $1.30 billion.
The cost of sales rose 3.7% year over year to $1.02 billion. Gross profit amounted to $245.5 million, up 10.8% from the prior-year quarter. The gross margin came in at 19.4%, up from last year’s 18.4%.
Selling, general and administrative expenses were $168 million compared with the prior-year quarter’s $146 million. Adjusted EBITDA rose 5.9% year over year to $145 million in the fiscal first quarter. Adjusted EBITDA margin was 11.5% compared with 11.4% in the year-ago quarter.
GEF’s Q1 Segmental Performance
The company completed its previously announced business model optimization and starting the first fiscal quarter of 2025, it is reporting results in four new segments.
Revenues in the Customized Polymer Solutions segment were $295 million, higher than the prior-year quarter’s $228 million on contributions from recent acquisitions. Our model projected revenues of $284 million for the quarter. The segment’s adjusted EBITDA amounted to $39.5 million compared with the year-ago quarter’s $25.8 million. The reported figure beat our estimate of $33 million.
The Durable Metal Solutions segment’s revenues fell 7.6% year over year to $342 million in the fiscal first quarter due to a decline in volumes. The figure missed our estimated revenues of $375 million. The segment’s adjusted EBITDA inched up to $45 million from the prior-year quarter’s $44.7 million. We projected the segment’s adjusted EBITDA to be $41 million.
The Sustainable Fiber Solutions segment’s revenues grew 6.2% year over year to $561 million in the fiscal first quarter due to higher published containerboard and boxboard prices. The figure beat our estimated revenues of $556 million. The segment’s adjusted EBITDA fell to $51.5 million from the prior-year quarter’s $53 million. We projected the segment’s adjusted EBITDA to be $58.5 million.
The Integrated Solutions segment’s revenues totaled $67 million in the reported quarter compared with $79 million in the year-ago quarter. We projected the segment's revenues to be $82 million in the quarter. Adjusted EBITDA was $8.9 million compared with the year-earlier quarter’s $13.5 million. Our projection for the quarter’s adjusted EBITDA was $21 million.
Greif’s Cash & Debt Position in Q1
Greif reported cash and cash equivalents of $201 million at the end of first-quarter fiscal 2025 compared with $179 million at the end of first quarter fiscal 2024. Cash used in operating activities totaled $30.8 million in the quarter under review against a cash inflow of $4.5 million in the prior-year quarter.
Long-term debt was $2.42 billion as of Jan. 31, 2025, compared with $2.63 billion as of Oct. 31, 2024.
On Feb. 24, Greif’s board announced a quarterly cash dividend of 54 cents per share of Class A Common Stock and 81 cents per share of Class B Common Stock. The dividend will be paid out on April 1, 2025, to its shareholders of record at the close of business as of March 17, 2025.
GEF’s 2025 Outlook
Greif expects the low end of fiscal 2025 adjusted free cash flow to be $245 million. The low end of adjusted EBITDA is anticipated to be $710 million, up from the previously announced $675 million.
Greif’s Stock Price Performance
Greif’s shares have gained 0.7% in a year compared with the industry’s 14.6% growth.
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GEF’s Zacks Rank
Greif currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Greif’s Peer Performances
AptarGroup, Inc. ATR reported fourth-quarter 2024 adjusted earnings per share of $1.52, which beat the Zacks Consensus Estimate of $1.26. The bottom line increased 27% year over year from $1.20 per share (including comparable exchange rates). The company expected fourth-quarter 2024 adjusted earnings per share to be $1.22-$1.30.
ATR’s total revenues increased 1.1% year over year to $848 million. However, the reported figure missed the Zacks Consensus Estimate of $858 million.
Packaging Corporation of America PKG posted adjusted earnings per share of $2.47 in the fourth quarter of 2024, which missed the Zacks Consensus Estimate of $2.51 by a margin of 2%. The bottom line matched PKG’s guidance and grew 16% year over year. The upside was driven by higher prices and mix, improved volume in both segments, and lower freight and logistics expenses. However, these gains were somewhat offset by an increase in operating expenses, scheduled maintenance outage expenses, depreciation expenses and other expenses.
Revenues in the fourth quarter rose 10.7% year over year to $2.15 billion due to higher volumes and price/mix in both segments. The top line beat the Zacks Consensus Estimate of $2.13 billion.
Amcor Plc AMCR reported second-quarter fiscal 2025 (ended Dec. 31, 2024) adjusted earnings per share of 16 cents, which met the Zacks Consensus Estimate. The company reported earnings of around 16 cents per share in the year-ago quarter. Gains from improved volumes, continued strong cost performance and benefits from restructuring initiatives were offset by unfavorable impacts of price/mix.
Amcor’s revenues dipped 0.3% year over year to $3.24 billion. The downside was due to a 1% unfavorable impact of foreign exchange and a 1% effect of pass-through of lower raw material costs. The volume rose 2.3% from the year-ago quarter. The price/mix had an unfavorable impact of approximately 2% due to lower volumes in high-value healthcare categories. The top line missed the Zacks Consensus Estimate of $3.44 billion.
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