SEE - Sealed Air slashes full-year guidance seeing weak packaging demand

2023-08-08 09:15:44 ET

Sealed Air ( NYSE: SEE ) -8.3% pre-market Tuesday after beating Q2 adjusted earnings expectations but cutting full-year earnings and sales guidance and announcing a three-year restructuring program.

Q2 net income fell to $94M, or $0.65/share, from $114M, or $0.77/share, primarily due to lower volumes, partially offset by earnings generated from Liquibox; net sales fell by $12M, or 1% Y/Y, on a constant dollar basis, while sales volumes decreased $117M, or 8% Y/Y.

Sealed Air ( SEE ) slashed full-year guidance for adjusted earnings to $2.75-$2.95/share from its previous outlook for $3.50-$3.80/share and well below analyst consensus estimate $3.42, and it now sees net sales of $5.4B-$5.6B, compared to prior guidance of $5.85B-$6.1B and below $5.85B consensus.

The company also lowered guidance for full-year adjusted EBITDA to $1.08B-$1.13B from $1.25B-$1.3B previously, and free cash flow to $325M-$375M from $475M-$525M.

"We expect demand weakness to continue with second half volumes similar to first half of 2023," CEO Ted Donehy said, adding the company is expanding its cost-cutting strategy, looking to cut costs by $140M-$160M annually by year-end 2025.

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