Greif, Inc. — Fiscal 2026 Earnings Summary

Financial Performance:

• Net loss for the fourth quarter of fiscal 2026 decreased to $6.5 million ($0.11 per diluted Class A share) compared to a net loss of $24.3 million ($0.42 per diluted Class A share) in the prior year quarter.
• Net income, excluding adjustments, for the fourth quarter increased 46.1% to $49.1 million ($0.87 per diluted Class A share) from $33.6 million ($0.58 per diluted Class A share) in the prior year.
• Adjusted EBITDA for the fourth quarter decreased 3.1% to $163.0 million from $168.2 million in the prior year; results were $18.2 million unfavorable due to timing of incentive accrual changes in the prior year.
• Net income for the full fiscal year 2026 increased to $261.5 million ($4.54 per diluted Class A share) compared to $31.6 million ($0.55 per diluted Class A share) in fiscal 2025.
• Net income, excluding adjustments, for the full fiscal year 2026 increased 73.3% to $231.9 million ($4.04 per diluted Class A share) from $133.8 million ($2.31 per diluted Class A share) in fiscal 2025.
• Adjusted EBITDA for the full fiscal year 2026 increased 11.7% to $625.7 million from $560.0 million in fiscal 2025.
• Net cash provided by operating activities for the full fiscal year 2026 increased by $198.4 million to $296.0 million, compared to $97.6 million in fiscal 2025; the prior year included an unfavorable tax impact of approximately $381.0 million from the sale of the Containerboard Business.
• Adjusted free cash flow for the full fiscal year 2026 decreased by $101.0 million to $279.3 million; the prior year included contributions from the Containerboard Business and is not directly comparable.
• Total debt decreased by $106.2 million to $1,096.3 million, primarily due to debt repayment from the timberlands business sale.
• Net debt decreased by $144.9 million to $800.9 million.
• The leverage ratio decreased to 1.2x from 1.7x.

Guidance and Future Outlook:

• The company provided low-end guidance for fiscal 2027, citing a multi-year period of industrial contraction with no identified compelling demand inflection on the horizon.
• Fiscal 2027 low-end guidance estimates Adjusted EBITDA at $645 million.
• Fiscal 2027 low-end guidance estimates Adjusted free cash flow at $290 million.
• Management stated it is appropriate to provide only low-end guidance based on continuing demand trends, current price/cost factors, and other identifiable discrete items.

Business Segments and Product Lines:

• Customized Polymer Solutions: Net sales increased by $39.2 million to $361.9 million, driven by $40.0 million in higher average selling prices, acquisitions, and positive currency translation, partially offset by lower volumes. Operating profit increased by $7.1 million to $8.6 million. Adjusted EBITDA remained flat at $44.5 million.
• Durable Metal Solutions: Net sales increased by $0.6 million to $392.5 million due to higher selling prices and currency translation, partially offset by lower volumes. Operating profit increased by $5.4 million to $41.9 million. Adjusted EBITDA decreased by $0.8 million to $56.2 million due to higher SG&A expenses.
• Sustainable Fiber Solutions: Net sales increased by $4.9 million to $360.1 million, driven by $8.5 million in higher selling prices and $4.0 million in higher volumes, partially offset by a $4.8 million impact from the Soterra land management divestiture. Operating profit decreased by $15.8 million to an operating loss of $21.4 million due to higher raw material/manufacturing costs and impairment charges related to the Sweetwater paperboard mill closure. Adjusted EBITDA decreased by $9.5 million to $52.0 million.
• Innovative Closure Solutions: Net sales increased by $4.6 million to $29.1 million due to $5.2 million in higher average selling prices. Operating profit increased by $4.7 million to $7.3 million. Adjusted EBITDA increased by $5.1 million to $10.3 million.
• The Containerboard Business, including the CorrChoice sheet feeder system, was divested on August 31, 2025, and reported as discontinued operations beginning in Q3 fiscal 2025.
• The Integrated Solutions segment was renamed Innovative Closure Solutions effective October 1, 2025.
• Activities related to recycled fiber and adhesives previously in Integrated Solutions were moved to Sustainable Fiber Solutions.
• Activities related to packaging products for steel (paints, linings, filling) previously in Integrated Solutions were moved to Durable Metal Solutions.

Market and Competitive Landscape:

• The company operates in global industrial markets that have experienced a multi-year period of contraction.
• Greif focuses on core businesses where it holds leading market positions and sees attractive opportunities for profitable growth.
• The company noted that performance reflected the strength of its businesses and actions to improve profitability rather than relying on a market recovery.

Risks and Challenges:

• Elevated inventory balances and higher resin costs contributed to the decrease in adjusted free cash flow for the full year, reflecting a strategic decision to ensure supply continuity amid Middle East disruptions.
• Current quarter results were unfavorably impacted by timing of incentive accrual changes in the prior year.
• The company faces risks including economic conditions, end-market demand, competitive pressure, customer/supplier consolidation, geopolitical and currency risks, raw material volatility, and execution of strategic initiatives.

Management Commentary and Tone:

• CEO Ole Rosgaard stated the company delivered a strong fiscal 2026, growing adjusted EBITDA by nearly 12% despite continued weakness in global industrial markets.
• Management highlighted achieving $105 million in annual run-rate cost savings, exceeding the original commitment one year ahead of schedule.
• The tone was confident regarding the company's position to grow earnings and cash flow with a lower cost base and stronger balance sheet, even without a meaningful recovery in industrial demand.

Other Key Points:

• Announced strategic exit of the Coated Recycled Board business with the closure of the Sweetwater paperboard mill in Austell, GA.
• Expanded total cost optimization commitment to $150 million cumulative run-rate savings by the end of fiscal 2027.
• The Board of Directors declared quarterly cash dividends of $0.62 per Class A share and $0.93 per Class B share, totaling approximately $35.1 million, paid by October 1, 2026.
• The Containerboard Business was sold to Packaging Corporation of America for $1.8 billion in an all-cash transaction.
• Fiscal year-end changed from October 31 to September 30 effective fiscal 2025.
• The company recorded an income tax rate of 118.6% for the fourth quarter and 28.0% for the full year; tax rates excluding adjustments were 42.2% and 28.1%, respectively.