Graphic Packaging Holding Company reported first quarter 2025 net income of $127 million, or $0.42 per diluted share, a decrease from $165 million, or $0.53 per diluted share, in Q1 2024. Adjusted net income was $154 million, or $0.51 per diluted share, compared to $203 million, or $0.66 per diluted share, in the prior year.
Net sales for the first quarter decreased 6% to $2,120 million, down from $2,259 million in the same quarter last year. This decline was primarily driven by a $110 million impact from the Augusta divestiture and reduced open market sales, along with a $27 million unfavorable foreign exchange impact. Adjusted EBITDA decreased to $365 million from $443 million in Q1 2024, with the Adjusted EBITDA Margin falling to 17.2% from 19.6%.
The company's net leverage ratio increased to 3.5x from 3.0x in Q4 2024, with total debt rising by $526 million to $5,735 million. Capital expenditures in Q1 2025 were $313 million. Graphic Packaging also announced a new $1.5 billion share repurchase authorization, bringing the total available authorization to $1.865 billion as of April 30, 2025.
For the full year 2025, the company significantly reduced its guidance, now expecting net sales between $8.2 billion and $8.5 billion, adjusted EBITDA between $1.4 billion and $1.6 billion, and adjusted EPS between $1.75 and $2.25. These reductions reflect an anticipated 2% volume decline and an $80 million impact from input cost inflation, with the guidance range widened due to increased macroeconomic and consumer spending uncertainty.
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