LAKE FOREST, Ill. (News release) -- Pactiv Evergreen Inc. reported results for the third quarter of 2024. Michael King, President and Chief Executive Officer of Pactiv Evergreen, said, "Our execution during the third quarter was solid and we made meaningful progress on our long-term strategy. We maintained strict cost discipline, optimized enterprise resources and overcame challenges at the Pine Bluff, Arkansas mill during its final quarter under our ownership. As we advance to the next phase of our transformational journey, we intend to leverage our heritage of product innovation and design to foster growth and assist our customers in achieving their sustainability goals."
King continued, "In late September and early October, some of our teams and communities were significantly impacted by Hurricanes Helene and Milton. The safety and well-being of our team members remain our utmost priority. It's been truly inspiring to witness our teams swiftly activate contingency plans in response to these severe weather events, showcasing their commitment to serving our customers and supporting the affected communities."
Jon Baksht, Chief Financial Officer of Pactiv Evergreen, added, "Our third quarter results reflect our efforts to right size our operations and manage resources to align with the broader demand environment. Our team has done an excellent job reducing our cost to serve by implementing various initiatives to set Pactiv Evergreen up for success. Compared to the prior quarter, we reduced our leverage profile and are on track to deliver on the cost savings targets we laid out in August. We are also continuing to invest in areas of the business to drive growth for Pactiv Evergreen and create value for our stockholders."
Third Quarter 2024 Financial Highlights:
- Net Revenues of $1,333 million for the third quarter of 2024 were down 3% compared to $1,379 million in the third quarter of 2023 and were approximately flat compared to $1,338 million in the second quarter of 2024.
- Net Loss from continuing operations of $213 million for the third quarter of 2024 compared to net income of $28 million in the third quarter of 2023 and net income of $20 million in the second quarter of 2024.
- Adjusted EBITDA1 of $214 million for the third quarter of 2024 compared to $227 million in the third quarter of 2023 and $183 million in the second quarter of 2024.
- Diluted loss per share from continuing operations of $1.18 for the third quarter of 2024 compared to diluted earnings per share of $0.15 in the third quarter of 2023 and diluted earnings per share of $0.10 in the second quarter of 2024.
- Adjusted EPS1 of $0.36 for the third quarter of 2024 compared to $0.32 in the third quarter of 2023 and $0.17 in the second quarter of 2024.
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1 Adjusted EBITDA and Adjusted EPS are non-GAAP measures. All references to Adjusted EBITDA and Adjusted EPS are references to Adjusted EBITDA from continuing operations and Adjusted EPS from continuing operations, respectively. Refer to their definitions in the discussion on non-GAAP financial measures and the accompanying reconciliations below.
Third Quarter 2024 Results vs. Third Quarter 2023 Results
Net revenues in the third quarter of 2024 were $1,333 million compared to $1,379 million in the third quarter of 2023. The decrease was primarily due to lower sales volume, partially offset by favorable pricing in the Foodservice segment, mainly due to the pass through of higher material costs, and favorable product mix in the Food and Beverage Merchandising segment. Lower sales volume was mostly due to a focus on value over volume in the Food and Beverage Merchandising segment and the broader demand environment.
Net loss from continuing operations was $213 million, or $1.18 per diluted share, in the third quarter of 2024 compared to net income of $28 million, or $0.15 per diluted share, in the third quarter of 2023. The change was principally due to the $322 million impairment charge resulting from the divestiture of our Pine Bluff, Arkansas mill and our Waynesville, North Carolina extrusion facility (the "Mill Transaction"). The change also reflects a $60 million decrease in tax expense largely as a result of the aforementioned impairment charge.
Adjusted EBITDA1 was $214 million and Adjusted EPS1 was $0.36 in the third quarter of 2024 compared to $227 million and $0.32, respectively, in the third quarter of 2023. The decrease in Adjusted EBITDA1 reflects higher manufacturing costs and lower sales volume, partially offset by lower incentive based compensation costs, favorable product mix in the Food and Beverage Merchandising segment and favorable pricing, net of material costs passed through, in the Foodservice segment. The increase in Adjusted EPS1 is primarily due to impacts of the aforementioned Mill Transaction.
