GREIF, INC: Results of Operations and Financial Condition, Settlement FD Disclosure, Financial Statements and Exhibits (Form 8-K)

Item 2.02. Results of Operations and Financial Condition.

On June 8, 2022, Greif, Inc. (the “Company”) issued a press release (the “Results Release”) announcing the financial results for its second quarter ended April 30, 2022. The full text of the earnings release is provided as Exhibit 99.1 to this current report on Form 8-K.

The earnings release included the following non-GAAP financial measures (the “Non-GAAP Measures”):

(i) the net income of the Company, excluding the impact of adjustments, for the second quarter of 2022 and the second quarter of 2021, which is equal to the consolidated net income of the Company for the applicable period plus restructuring charges, plus debt extinguishment, plus integration-related costs, plus non-cash asset impairment charges, plus non-cash pension settlement charges, plus incremental COVID-19 related costs, net, plus the (gain) loss on disposal of property, plant, equipment and businesses, net gains and land gains, net, each net of tax, non-controlling interests and results of shareholders’ equity of unconsolidated affiliates and on a consolidated basis for the applicable period;

(ii) the earnings per diluted Class A share of the Company, excluding the impact of adjustments, for the second quarter of 2022 and the second quarter of 2021, which is equal to the earnings per diluted Class A share of the Company for the period applicable plus restructuring charges, plus debt extinguishment charges, plus integration-related costs, plus non-cash asset impairment charges, plus non-cash repo settlement charges, plus incremental costs related to COVID-19, net, plus (gain) loss on disposal of fixed assets, plant and equipment and businesses, net gains and property gains, net, each net of tax, non-investment interests the control and result of the shareholders’ equity of the unconsolidated affiliates and on a consolidated basis for the applicable period;

(iii) the Company’s consolidated Adjusted EBITDA for the second quarter of 2022 and the second quarter of 2021, which is equal to the Company’s consolidated net earnings for the applicable period plus interest expense, net, plus debt extinguishment, plus income tax expense, plus amortization, depletion, and impairment charges, plus restructuring charges, plus integration-related costs, plus impairment charges of non-cash assets, plus non-cash pension settlement charges, plus incremental COVID-19 related costs, net, plus (gain) loss on disposal of property, plant, equipment and businesses, net, plus forest capital gains, net, each on a consolidated basis for the applicable period;

(iv) the Company’s consolidated adjusted free cash flow for the second quarter of 2022 and the second quarter of 2021, which is equal to the Company’s consolidated net cash provided by operating activities for the applicable period less cash paid for property, plant and equipment purchases, plus cash paid for integration-related costs, plus cash paid for incremental COVID-19-related costs, net, plus cash paid for systems integration-related enterprise resource planning (“ERP”) plans, plus cash paid for debt issuance costs, each on a consolidated basis for the applicable period;

(v) the net debt of the Company for the second quarter of 2022 and the second quarter of 2021, which is equal to the total consolidated debt of the Company at the end of the applicable period less cash and cash equivalents at the end of the applicable period.

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(vi) net revenue excluding foreign currency translation for Global industrial packaging line of business for the second quarter of 2022 and the second quarter of 2021, which is equal to the net sales of that line of business for the applicable quarter, after adjusting those sales for the second quarter of 2022 to take into account the currency conversion;

(vii) Adjusted EBITDA of the Company’s net income Global industrial packaging line of business for the second quarter of 2022 and the second quarter of 2021, which is equal to operating income for that line of business less other (income) expenses, net, less results of equity of unconsolidated affiliates, net tax, plus depreciation and amortization, plus restructuring charges, plus non-cash asset impairment charges, plus incremental COVID-19 related costs, net, plus (gains) losses on disposal of fixed assets, plants, equipment and businesses, net, each for the applicable period;

(viii) Adjusted EBITDA for Company revenue Paper packaging and services business segment for the second quarter of 2022 and the second quarter of 2021, which is equal to operating income for that business segment less non-cash pension settlement expenses, less other (income) expenses, net , plus amortization expense, plus restructuring charges , plus integration-related costs, plus non-cash pension settlement charges, plus incremental COVID-19 related costs, net, plus (gain) loss on the disposal of property, plant and equipment, plant, equipment and businesses, net, each for the applicable period; and

(ix) the Company’s debt ratio for the second and first quarters of 2022 and the second quarter of 2021, which is equal to the net debt divided by the EBITDA of the last twelve months, each as calculated according to the terms of the Company’s Second Amended and Restated Credit Agreement dated March 1, 2022which was filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2022.

The earnings release also included the following forward-looking non-GAAP measures:

(i) earnings per Class A share of the Company for fiscal year 2022 before adjustments, which equals earnings per diluted Class A share of the Company for that period plus restructuring charges, plus extinguishment charges of debt, plus integration-related costs, plus debt extinguishment charges, plus non-cash asset impairment charges, plus non-cash pension settlement charges, plus (gain) loss on disposal of fixed assets, plant, equipment and businesses, net, plus gains on forest land, net, each net of tax, non-controlling interests and equity results of unconsolidated affiliates and on a consolidated basis for the applicable period; and

(ii) the Company’s projected adjusted free cash flow guidance for fiscal 2022, which is equal to the Company’s consolidated net cash provided by operating activities for that period, less cash paid for purchases of fixed assets, plus cash paid for integration costs, plus cash paid for ERP systems related to the integration, plus cash paid for debt issuance costs. A reconciliation of this forward-looking non-GAAP financial measure has been included in the earnings release.

No reconciliation of the forward-looking non-GAAP financial measure to the most directly comparable GAAP financial measure for item (i) is included in the earnings release because, due to the high variability and difficulty in making accurate forecasts and projections of some of the excluded information, as well as some of the excluded information not being verifiable or accessible, the Company is unable to quantify certain amounts that should be included in the GAAP financial measure the most directly comparable without unreasonable effort.

The Company’s management uses non-GAAP measures to evaluate ongoing transactions and believes these non-GAAP measures are useful to investors. Excluding the impact of identified adjustments (restructuring costs, debt extinguishment costs, integration-related costs, non-cash asset impairment charges, non-cash pension settlement costs, additional costs related to COVID-19, net loss and (gain) on disposal of property, plant, equipment and businesses, net) allows management and investors to make meaningful comparisons of the Company’s current and historical performance. The Company’s management also believes that excluding the impact of the identified adjustments provides a stable platform on which to compare the historical performance of the Company and that investors want this information. Management estimates that using consolidated adjusted free cash flow, which excludes cash paid for capital expenditures, integration-related costs, incremental costs related to COVID-19, net, cash paid for integration-related ERP systems and cash paid for company debt issuance costs Consolidated net cash from operating activities, provides additional information to assess the cash flows generated by the Company and believes that it is information that investors find valuable. Non-GAAP measures are intended to supplement and should be read in conjunction with our financial results. Non-GAAP measures should not be considered an alternative or substitute for, and should not be considered superior to, our reported financial results. Accordingly, users of this financial information should not place undue reliance on non-GAAP measures.

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Section 7.01. FD Regulation Disclosure.

i. Transcript of the conference call

On June 9, 2022the Company’s management held a conference call with interested investors and financial analysts (the “Conference Call”) to discuss the Company’s financial results for its second quarter ended April 30, 2022. The transcript of the conference call record is provided as Exhibit 99.2 to this current report on Form 8-K.

Section 9.01. Financial statements and supporting documents.

(d)Exhibits.
Exhibit No.       Description
  99.1            Press release issued by Greif Inc. on June 8, 2022 announcing the financial
                  results for its second quarter ended April 30, 2022.
  99.2            File transcript of conference call with interested investors and financial
                  analysts held by management of Greif Inc. on June 9, 2022.

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