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PSM for /24

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q 
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
Or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
Commission File Number: 1-12139
SEALED AIR CORPORATION
(Exact name of registrant as specified in its charter)
 
Delaware 65-0654331
(State or other jurisdiction of
incorporation or organization)
 (I.R.S. Employer
Identification Number)
2415 Cascade Pointe Boulevard 
CharlotteNorth Carolina28208
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (980221-3235 
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common Stock, par value $0.10 per shareSEENew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer   Accelerated filer ¨
       
Non-accelerated filer ¨  Smaller reporting company 
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨ 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  ý
There were 145,614,668 shares of the registrant’s common stock, par value $0.10 per share, issued and outstanding as of April 30, 2024.



SEALED AIR CORPORATION AND SUBSIDIARIES
Table of Contents
 Page
PART I. FINANCIAL INFORMATION 
Financial statements
PART II.  OTHER INFORMATION 



2




Cautionary Notice Regarding Forward-Looking Statements
This report contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 concerning our business, consolidated financial condition, results of operations and cash flows. The Securities and Exchange Commission (“SEC”) encourages companies to disclose forward-looking statements so that investors can better understand a company’s future prospects and make informed investment decisions. Forward-looking statements are subject to risks and uncertainties, many of which are outside our control, which could cause actual results to differ materially from these statements. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements can be identified by such words as “anticipate,” “believe,” “plan,” “assume,” “could,” “should,” “estimate,” “expect,” “intend,” “potential,” “seek,” “predict,” “may,” “will” and similar references to future periods. All statements other than statements of historical facts included in this report regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding expected future operating results, expectations regarding the results of restructuring and other programs, expectations regarding future impacts of acquisitions, anticipated levels of capital expenditures and expectations of the effect on our financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings.
The following are important factors that we believe could cause actual results to differ materially from those in our forward-looking statements: global economic and political conditions, including recessionary and inflationary pressures, currency translation and devaluation effects, changes in raw material pricing and availability, competitive conditions, the success of new product offerings, failure to realize synergies and other financial benefits from acquisitions within the expected time frames, greater than expected costs or difficulties related to acquisition integrations, consumer preferences, the effects of animal and food-related health issues, the effects of epidemics or pandemics, negative impacts related to the ongoing conflict between Russia and Ukraine and related sanctions, export restrictions and other counteractions thereto, uncertainties relating to existing or potential increased hostilities in the Middle East, changes in energy costs, environmental matters, the success of our restructuring activities, the success of our merger, acquisition and equity investment strategies, the success of our financial growth, profitability, cash generation and manufacturing strategies and our cost reduction and productivity efforts, changes in our credit ratings, regulatory actions and legal matters, and the other information referenced in Part I, Item 1A, "Risk Factors", of our Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC, and in any of our subsequent SEC filings. Any forward-looking statement made by us is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
3


SEALED AIR CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets 
(Unaudited)
(In USD millions, except share and per share data)March 31, 2024December 31, 2023
ASSETS  
Current assets:  
Cash and cash equivalents$352.8 $346.1 
Trade receivables, net of allowance for credit losses of $14.8 in 2024 and $14.9 in 2023
461.5 442.6 
Income tax receivables27.6 44.9 
Other receivables92.2 94.2 
Advances and deposits69.7 72.8 
Inventories, net of inventory reserves of $50.0 in 2024 and $43.3 in 2023 (Note 7)
790.2 774.3 
Prepaid expenses and other current assets198.8 188.4 
Total current assets1,992.8 1,963.3 
Property and equipment, net (Note 8)
1,411.2 1,416.4 
Goodwill (Note 9)
2,887.7 2,892.5 
Identifiable intangible assets, net (Note 9)
425.6 439.0 
Deferred taxes130.7 130.8 
Operating lease right-of-use-assets (Note 4)
80.3 86.5 
Other non-current assets271.0 272.1 
Total assets$7,199.3 $7,200.6 
LIABILITIES AND STOCKHOLDERS’ EQUITY  
Current liabilities:  
Short-term borrowings (Note 13)
$134.6 $140.7 
Current portion of long-term debt (Note 13)
43.5 35.7 
Current portion of operating lease liabilities (Note 4)
27.4 29.2 
Accounts payable811.8 764.6 
Accrued restructuring costs (Note 12)
28.8 23.1 
Income tax payable28.2 28.7 
Other current liabilities428.5 487.0 
Total current liabilities1,502.8 1,509.0 
Long-term debt, less current portion (Note 13)
4,484.2 4,513.9 
Long-term operating lease liabilities, less current portion (Note 4)
61.8 66.7 
Deferred taxes34.6 35.8 
Other non-current liabilities517.6 525.7 
Total liabilities6,601.0 6,651.1 
Commitments and contingencies (Note 18)
Stockholders’ equity:  
Preferred stock, $0.10 par value per share, 50,000,000 shares authorized; no shares issued in 2024 and 2023
  
Common stock, $0.10 par value per share, 400,000,000 shares authorized; shares issued: 154,486,042 in 2024 and 154,054,011 in 2023; shares outstanding: 145,607,340 in 2024 and 144,467,719 in 2023
15.4 15.4 
Additional paid-in capital1,423.4 1,429.5 
Retained earnings548.9 496.5 
Common stock in treasury, 8,878,702 shares in 2024 and 9,586,292 shares in 2023
(404.2)(436.4)
Accumulated other comprehensive loss, net of taxes (Note 20)
(985.2)(955.5)
Total stockholders’ equity598.3 549.5 
Total liabilities and stockholders’ equity$7,199.3 $7,200.6 

See accompanying Notes to Condensed Consolidated Financial Statements.
 
4


SEALED AIR CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Operations
(Unaudited)
 
Three Months Ended March 31,
(In USD millions, except per share data)20242023
Net sales$1,329.6 $1,348.8 
Cost of sales928.8 943.7 
Gross profit400.8 405.1 
Selling, general and administrative expenses185.5 221.6 
Amortization expense of intangible assets14.8 15.2 
Restructuring charges (Note 12)
15.5 (1.2)
Operating profit185.0 169.5 
Interest expense, net(65.1)(57.8)
Other expense, net (Note 21)
(0.8)(15.0)
Earnings before income tax provision119.1 96.7 
Income tax provision (Note 17)
35.7 33.8 
Net earnings from continuing operations83.4 62.9 
Loss on sale of discontinued operations, net of tax(1.4)(1.0)
Net earnings$82.0 $61.9 
Basic:  
Continuing operations$0.58 $0.44 
Discontinued operations(0.01)(0.01)
Net earnings per common share - basic (Note 22)
$0.57 $0.43 
Diluted:
Continuing operations$0.57 $0.44 
Discontinued operations(0.01)(0.01)
Net earnings per common share - diluted (Note 22)
$0.56 $0.43 
Weighted average number of common shares outstanding: (Note 22)
Basic144.9 144.1 
    Diluted145.4 144.8 
 
See accompanying Notes to Condensed Consolidated Financial Statements.


5


SEALED AIR CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
 
Three Months Ended March 31,
20242023
(In USD millions)GrossTaxesNetGrossTaxesNet
Net earnings$82.0 $61.9 
Other comprehensive income (loss):  
Recognition of pension items$1.2 $(0.3)0.9 $1.7 $(0.4)1.3 
Unrealized gains (losses) on derivative instruments for net investment hedge11.2 (2.8)8.4 (7.3)1.8 (5.5)
Unrealized gains (losses) on derivative instruments for cash flow hedge2.0 (0.6)1.4 (3.8)1.0 (2.8)
Foreign currency translation adjustments(40.4) (40.4)36.6  36.6 
Other comprehensive (loss) income$(26.0)$(3.7)(29.7)$27.2 $2.4 29.6 
Comprehensive income, net of taxes$52.3 $91.5 
 
See accompanying Notes to Condensed Consolidated Financial Statements.
6


SEALED AIR CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity
(Unaudited)
(In USD millions)Common StockAdditional
Paid-in Capital
Retained EarningsCommon
Stock in
Treasury
Accumulated Other
Comprehensive
Loss, Net of Taxes
Total
Stockholders’
Equity
Balance at December 31, 2023$15.4 $1,429.5 $496.5 $(436.4)$(955.5)$549.5 
Effect of share-based incentive compensation 0.7 — — — 0.7 
Stock issued for profit sharing contribution paid in stock— (6.8)— 32.2 — 25.4 
Recognition of pension items, net of taxes— — — — 0.9 0.9 
Foreign currency translation adjustments— — — — (40.4)(40.4)
Unrealized gain on derivative instruments, net of taxes— — — — 9.8 9.8 
Net earnings— — 82.0 — — 82.0 
Dividends on common stock ($0.20 per share)
— — (29.6)— — (29.6)
Balance at March 31, 2024$15.4 $1,423.4 $548.9 $(404.2)$(985.2)$598.3 
Balance at December 31, 2022$23.3 $2,155.3 $3,163.4 $(4,019.1)$(978.8)$344.1 
Effect of share-based incentive compensation0.1 (3.4)— — — (3.3)
Stock issued for profit sharing contribution paid in stock— 0.9 — 23.0 — 23.9 
Repurchases of common stock— — — (79.9)— (79.9)
Recognition of pension items, net of taxes— — — — 1.3 1.3 
Foreign currency translation adjustments— — — — 36.6 36.6 
Unrealized loss on derivative instruments, net of taxes— — — — (8.3)(8.3)
Net earnings— — 61.9 — — 61.9 
Dividends on common stock ($0.20 per share)
— — (29.8)— — (29.8)
Balance at March 31, 2023$23.4 $2,152.8 $3,195.5 $(4,076.0)$(949.2)$346.5 
See accompanying Notes to Condensed Consolidated Financial Statements.
7


SEALED AIR CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three Months Ended March 31,
(In USD millions)20242023
Net earnings$82.0 $61.9 
Adjustments to reconcile net earnings to net cash provided by operating activities  
Depreciation and amortization59.7 55.9 
Share-based incentive compensation8.5 17.6 
Profit sharing expense6.9 6.8 
Loss on debt redemption and refinancing activities 4.9 
Provision for allowance for credit losses on trade receivables0.9 2.2 
Provisions for inventory obsolescence6.1 5.4 
Deferred taxes, net(7.2)(2.8)
Net loss on disposal/sale of businesses1.4 1.0 
Other non-cash items(4.4)11.6 
Changes in operating assets and liabilities:  
Trade receivables, net(28.9)30.1 
Inventories, net(33.5)(32.0)
Accounts payable47.7 (62.8)
Customer advance payments(3.0)4.7 
Income tax receivable/payable17.2 12.7 
Other assets and liabilities(28.3)(65.3)
Net cash provided by operating activities$125.1 $51.9 
Cash flows from investing activities:  
Capital expenditures(47.1)(64.9)
Proceeds related to sale of business and property and equipment, net0.2 0.6 
Businesses acquired in purchase transactions, net of cash acquired4.2 (1,148.0)
Settlement of foreign currency forward contracts3.1 5.4 
Proceeds from cross-currency swaps1.6  
Net cash used in investing activities$(38.0)$(1,206.9)
Cash flows from financing activities:  
Net (payments) proceeds from short-term borrowings(3.7)167.9 
Proceeds from long-term debt 1,411.4 
Payments of long-term debt(25.3)(432.8)
Payments of debt modification/extinguishment costs and other (13.1)
Dividends paid on common stock(30.5)(31.1)
Impact of tax withholding on share-based compensation(7.8)(21.0)
Repurchases of common stock (79.9)
Principal payments related to financing leases(1.8)(2.3)
Net cash (used in) provided by financing activities$(69.1)$999.1 
Effect of foreign currency exchange rate changes on cash and cash equivalents$(11.3)$2.9 
Cash Reconciliation:
Cash and cash equivalents346.1 456.1 
Restricted cash and cash equivalents  
Balance, beginning of period$346.1 $456.1 
Net change during the period6.7 (153.0)
Cash and cash equivalents352.8 303.1 
Restricted cash and cash equivalents  
Balance, end of period$352.8 $303.1 
Supplemental Cash Flow Information:  
Interest payments$80.5 $50.8 
Income tax payments, net of cash refunds$20.9 $14.0 
Restructuring payments including associated costs$14.3 $3.1 
Non-cash items:
Transfers of shares of common stock from treasury for profit-sharing contributions$25.4 $23.9 

See accompanying Notes to Condensed Consolidated Financial Statements.
8


SEALED AIR CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited)

Note 1 Organization and Basis of Presentation
Organization
We are a leading global provider of packaging solutions that integrate sustainable, high-performance materials, automation, equipment, and services. Sealed Air Corporation designs, manufactures and delivers packaging solutions that preserve food, protect goods, and automate packaging processes. We deliver our packaging solutions to an array of end markets including fresh proteins, foods, fluids and liquids, medical and life science, e-commerce retail, logistics and omnichannel fulfillment operations, and industrials.
Our portfolio of solutions includes CRYOVAC® brand food packaging, LIQUIBOX® brand liquids systems, SEALED AIR® brand protective packaging, AUTOBAG® brand automated packaging systems and BUBBLE WRAP® brand packaging. We have established competitive strengths in high-performance packaging solutions, well-established customer relationships, iconic brands, and global scale and market access.
Throughout this report, when we refer to “Sealed Air,” “SEE,” the “Company,” “we,” “our,” or “us,” we are referring to Sealed Air Corporation and all of our subsidiaries, except where the context indicates otherwise.
Basis of Presentation
Our Condensed Consolidated Financial Statements include all of the accounts of the Company and our subsidiaries. We have eliminated all significant intercompany transactions and balances in consolidation. In management’s opinion, all adjustments, consisting only of normal recurring accruals, necessary for a fair statement of our Condensed Consolidated Balance Sheet as of March 31, 2024 and our Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023 have been made. The results set forth in our Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and in our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year. The Condensed Consolidated Balance Sheet as of December 31, 2023 was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. All amounts are in millions, except per share amounts, and are approximate due to rounding. All amounts are presented in U.S. dollar, unless otherwise specified.
Our Condensed Consolidated Financial Statements were prepared in accordance with the interim reporting requirements of the SEC. As permitted under those rules, annual footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted. The preparation of Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosure of contingent amounts in our Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ from these estimates.
We are responsible for the unaudited Condensed Consolidated Financial Statements and notes included in this report. As these are condensed financial statements, they should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (“2023 Form 10-K”), which was filed with the SEC on February 27, 2024, and with the information contained in our other publicly available filings with the SEC.
When we cross reference to a “Note,” we are referring to our “Notes to Condensed Consolidated Financial Statements,” unless the context indicates otherwise.
There were no significant changes to our significant accounting policies as disclosed in “Note 2 – Summary of Significant Accounting Policies and Recently Adopted and Issued Accounting Standards” of our audited consolidated financial statements and notes thereto included in our 2023 Form 10-K.
Impact of Highly Inflationary Economy
Argentina
9


Economic and political events in Argentina have continued to expose us to heightened levels of foreign currency exchange risk. As of July 1, 2018, Argentina was designated as a highly inflationary economy under U.S. GAAP, and the U.S. dollar replaced the Argentine peso as the functional currency for our subsidiary in Argentina. All Argentine peso-denominated monetary assets and liabilities were remeasured into U.S. dollars using the current exchange rate available to us. The impact of any changes in the exchange rate are reflected within Other expense, net on the Condensed Consolidated Statements of Operations. The Company recorded $4.9 million and $2.6 million of remeasurement losses for the three months ended March 31, 2024 and 2023, respectively, related to our subsidiary in Argentina.
Note 2 Recently Adopted and Issued Accounting Standards
Recently Adopted Accounting Standards
In September 2022, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations ("ASU 2022-04"). ASU 2022-04 requires the buyer in a supplier finance program to disclose qualitative and quantitative information about the program. The Company adopted ASU 2022-04 on January 1, 2023, except for the amendment on rollforward information, which is effective for fiscal years beginning after December 15, 2023. The adoption did not materially impact the Company's Condensed Consolidated Financial Statements.
We facilitate a voluntary supply chain financing program to provide some of our suppliers with the opportunity to sell receivables due from us (our accounts payables) to participating financial institutions at the sole discretion of both the suppliers and the financial institutions. This program is administered by participating financial institutions. When a supplier utilizes the supply chain financing program, the supplier receives a payment in advance of agreed payment terms from the financial institution, net of a discount charged. Our responsibility is limited to making payments to the respective financial institutions on the terms originally negotiated with our supplier. We monitor our days payable outstanding relative to our peers and industry trends in order to assess our conclusion that the program continues to be a trade payable program and not indicative of a borrowing arrangement. The liabilities continue to be presented as Accounts payable in our Condensed Consolidated Balance Sheets until they are paid, and they are reflected as Cash flows from operating activities when settled. At March 31, 2024 and December 31, 2023, our accounts payable balances included $164.2 million and $153.0 million, respectively, related to invoices from suppliers participating in the program.
Recently Issued Accounting Standards
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 requires the annual disclosure of specific categories in the rate reconciliation and additional information for the reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate). ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 requires annual and interim disclosure of significant segment expenses that are regularly provided to the chief operating decision maker ("CODM"), the disclosure and description of other segment items, the inclusion of all current annual disclosures about a reportable segment in interim periods, allows for disclosure of multiple measures of a reportable segment's profit or loss, requires disclosure of the CODM's title and position, and requires a description of how the CODM uses reported measures in assessing the performance of reportable segments and in making decisions pertaining to allocation of resources. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.
10


Note 3 Revenue Recognition, Contracts with Customers
Description of Revenue Generating Activities
We employ sales, marketing and customer service personnel throughout the world who sell and market our products, services, equipment and systems.
As discussed in Note 6, “Segments,” our reporting segments are Food and Protective. Our Food solutions are largely sold directly to end customers, while our Protective solutions are sold through business supply distributors and directly to end customers.
Food:
Food solutions are sold to food processors in fresh red meat, smoked and processed meats, poultry, seafood, fluids and liquids, cheese, and other food markets worldwide. Food offers integrated packaging materials and automated equipment solutions to increase food safety, extend shelf life, reduce food waste, automate processes and optimize total cost. Its materials, automated equipment and service enable customers to reduce costs and enhance their brands in the marketplace.
Food solutions are utilized by food service businesses (such as restaurants and entertainment venues) (“food service”) and food retailers (such as grocery stores and supermarkets) (“food retail”), among others. Solutions serving the food service market include products such as barrier bags and pouches, and are primarily marketed under the CRYOVAC® trademark and other highly recognized trade names including CRYOVAC® brand Barrier Bags, CRYOVAC® brand Form-Fill-Seal Films, CRYOVAC® brand Auto Pouch Systems and LIQUIBOX® brand liquids systems. Solutions serving the food retail market include products such as barrier bags, film, and trays, and are primarily marketed under the CRYOVAC® trademark and other highly recognized trade names including CRYOVAC® brand Grip & TearTM, CRYOVAC® brand Darfresh®, OptiDure™, Simple Steps®, and CRYOVAC® brand Barrier Bags.
Protective:
Protective packaging solutions are utilized across many global markets to protect goods during transit and are especially valuable to e-commerce, consumer goods, pharmaceutical and medical devices and industrial manufacturing. Protective solutions are designed to increase our customers' packaging velocity, minimize packaging waste, reduce labor dependencies and address dimensional weight challenges.
Protective solutions are sold through a strategic network of distributors as well as directly to our customers, including, but not limited to, fabricators, original equipment manufacturers, contract manufacturers, logistics partners and e-commerce/fulfillment operations. Protective solutions are marketed under SEALED AIR® brand, BUBBLE WRAP® brand, AUTOBAG® brand and other highly recognized trade names and product families including BUBBLE WRAP® brand inflatable packaging, SEALED AIR® brand performance shrink films, AUTOBAG® brand bagging systems, Instapak® polyurethane foam packaging solutions and Korrvu® suspension and retention packaging.
Other Revenue Recognition Considerations:
Charges for rebates and other allowances are recognized as a deduction from revenue on an accrual basis in the period in which the associated revenue is recorded. Revenue recognized from performance obligations satisfied in previous reporting periods was $1.1 million and $0.8 million for the three months ended March 31, 2024 and 2023, respectively.
The Company does not adjust consideration in contracts with customers for the effects of a significant financing component if the Company expects that the period between transfer of a good or service and payment for that good or service will be one year or less. This is expected to be the case for the majority of the Company's contracts.

Lease components within contracts with customers are recognized in accordance with Accounting Standards Codification (“ASC”) Topic 842.
11


Disaggregated Revenue
For the three months ended March 31, 2024 and 2023, revenues from contracts with customers summarized by Segment and Geographic region were as follows:
Three Months Ended
March 31, 2024
(In millions)FoodProtectiveTotal
Americas$578.6 $296.3 $874.9 
EMEA172.7 99.5 272.2 
APAC110.9 63.5 174.4 
Topic 606 Segment Revenue862.2 459.3 1,321.5 
Non-Topic 606 Revenue (Leasing: Sales-type and Operating)6.2 1.9 8.1 
Total$868.4 $461.2 $1,329.6 

Three Months Ended
March 31, 2023
(In millions)FoodProtectiveTotal
Americas$566.1 $306.2 $872.3 
EMEA169.2 119.6 288.8 
APAC112.3 68.6 180.9 
Topic 606 Segment Revenue847.6 494.4 1,342.0 
Non-Topic 606 Revenue (Leasing: Sales-type and Operating)5.5 1.3 6.8 
Total$853.1 $495.7 $1,348.8 
Contract Balances
The time when a performance obligation is satisfied and the time when billing and payment occur are generally closely aligned, subject to agreed payment terms, with the exception of equipment accruals. An equipment accrual is a contract offering, whereby a customer is incentivized to use a portion of the materials transaction price for future equipment purchases. Long-term contracts that include an equipment accrual create a timing difference between when cash is collected and when the performance obligation is satisfied, resulting in a contract liability (unearned revenue). The following contract assets and liabilities are included within Prepaid expenses and other current assets and Other current liabilities, or Other non-current liabilities on our Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023:

(In millions)March 31, 2024December 31, 2023
Contract assets$0.4 $0.4 
Contract liabilities$20.6 $19.9 
The contract liability balances represent deferred revenue, primarily related to equipment accruals. Revenue recognized in the three months ended March 31, 2024 and 2023 that was included in the contract liability balance at the beginning of the period was $2.6 million and $4.6 million, respectively. This revenue was driven primarily by equipment performance obligations being satisfied.
Remaining Performance Obligations
The following table summarizes the estimated transaction price from contracts with customers allocated to performance obligations or portions of performance obligations that have not yet been satisfied as of March 31, 2024 and December 31, 2023, as well as the expected timing of recognition of that transaction price.
(In millions)March 31, 2024December 31, 2023
Short-Term (12 months or less)(1)
$13.3 $13.3 
Long-Term7.3 6.6 
Total transaction price$20.6 $19.9 
12


(1) Our enforceable contractual obligations tend to be short term in nature. The table above does not include the transaction price of any remaining performance obligations that are part of the contracts with expected durations of one year or less.    
Note 4 Leases
Lessor
SEE has contractual obligations as a lessor with respect to some of our automation and equipment solutions including "free on loan" equipment and leased equipment, both sales-type and operating. The consideration in a contract that contains both lease and non-lease components is allocated based on the standalone selling price.
Our contractual obligations for operating leases can include termination and renewal options. Our contractual obligations for sales-type leases tend to have fixed terms and can include purchase options. We utilize the reasonably certain threshold criteria in determining which options our customers will exercise.
All lease payments are primarily fixed in nature and therefore captured in the lease receivable. Our sales-type lease receivable balances at March 31, 2024 and December 31, 2023 were as follows:
(In millions)March 31, 2024December 31, 2023
Short-Term (12 months or less)$8.7 $8.5 
Long-Term33.3 33.3 
Lease receivables$42.0 $41.8 
13


Sales-type and operating lease revenue was less than 1% of net trade sales for the three months ended March 31, 2024 and year ended December 31, 2023.
Lessee
SEE has contractual obligations as a lessee with respect to warehouses, offices and manufacturing facilities, IT equipment, automobiles, and material production equipment.
The following table details our lease obligations included in our Condensed Consolidated Balance Sheets.
(In millions)March 31, 2024December 31, 2023
Other non-current assets:
Finance leases - ROU assets$37.5 $36.0 
Finance leases - Accumulated depreciation(15.3)(14.9)
Operating lease right-of-use-assets:
Operating leases - ROU assets195.5 203.1 
Operating leases - Accumulated depreciation(115.2)(116.6)
Total lease assets$102.5 $107.6 
Current portion of long-term debt:
Finance leases$(7.1)(6.7)
Current portion of operating lease liabilities:
Operating leases (27.4)(29.2)
Long-term debt, less current portion:
Finance leases(13.8)(12.8)
Long-term operating lease liabilities, less current portion:
Operating leases(61.8)(66.7)
Total lease liabilities$(110.1)$(115.4)
At March 31, 2024, estimated future minimum annual rental commitments under non-cancelable real and personal property leases were as follows:
(In millions)Finance leasesOperating leases
Remainder of 2024$6.6 $24.9 
20256.1 27.5 
20264.1 21.2 
20271.9 12.1 
20281.0 7.1 
Thereafter8.1 10.3 
Total lease payments27.8 103.1 
Less: Interest(6.9)(13.9)
Present value of lease liabilities$20.9 $89.2 
The following lease cost is included in our Condensed Consolidated Statements of Operations:
14


Three Months Ended
March 31,
(In millions)20242023
Lease cost(1)
Finance leases
Amortization of ROU assets$2.0 $2.5 
Interest on lease liabilities0.4 0.4 
Operating leases9.4 9.0 
Short-term lease cost0.2 0.6 
Variable lease cost1.7 1.8 
Total lease cost$13.7 $14.3 
(1) With the exception of Interest on lease liabilities, we record lease costs to Cost of sales or Selling, general and administrative expenses on the Condensed Consolidated Statements of Operations, depending on the use of the leased asset. Interest on lease liabilities is recorded to Interest expense, net on the Condensed Consolidated Statements of Operations.
The following table details cash paid related to operating and finance leases included in our Condensed Consolidated Statements of Cash Flows and new right-of-use (“ROU”) assets included in our Condensed Consolidated Balance Sheets:
Three Months Ended
March 31,
(In millions)20242023
Other information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - finance leases$0.9 $1.1 
Operating cash flows - operating leases$9.8 $9.1 
Financing cash flows - finance leases$1.8 $2.3 
ROU assets obtained in exchange for new finance lease liabilities$3.3 $5.9 
ROU assets obtained in exchange for new operating lease liabilities$2.3 $20.8 
Three Months Ended
March 31,
20242023
Weighted average information:
Finance leases
Remaining lease term (in years)5.98.3
Discount rate7.5 %6.3 %
Operating leases
Remaining lease term (in years)4.34.4
Discount rate6.0 %5.3 %
Note 5 Acquisitions
LB Holdco, Inc. Acquisition
On February 1, 2023, SEE acquired 100% of the outstanding shares of capital stock of LB Holdco, Inc., the parent company of Liquibox, Inc. (collectively, "Liquibox"), a pioneer, innovator and manufacturer of Bag-in-Box fluids and liquids packaging and dispensing solutions for food, beverage, consumer goods and industrial end markets. The acquisition is included in our Food reporting segment.
15


Consideration paid was approximately $1.16 billion in cash. In March of 2024, subsequent to the closure of the measurement period, we reached a final purchase price settlement with the seller of $3.5 million, which was recorded as income within Other expense, net on the Condensed Consolidated Statements of Operations. We financed the consideration paid and related fees and expenses through borrowings under our senior secured credit facility, proceeds from the issuance of senior notes, and cash on hand. See Note 13, "Debt and Credit Facilities," for additional details. For the three months ended March 31, 2023, acquisition-related expenses recognized for the Liquibox acquisition were $11.9 million. These expenses are included within Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.
The following table summarizes the consideration transferred to acquire Liquibox and the allocation of the purchase price among the assets acquired and liabilities assumed, including measurement period adjustments recorded through the finalized purchase price allocation on December 31, 2023.
Preliminary AllocationMeasurement PeriodFinal Allocation
(In millions)As of February 1, 2023AdjustmentsDecember 31, 2023
Total consideration transferred$1,169.2 $(2.1)$1,167.1 
Assets acquired:
Cash and cash equivalents21.2 — 21.2 
Trade receivables48.6 (0.8)47.8 
Inventories61.6 (2.8)58.8 
Prepaid expenses and other current assets15.8 (1.7)14.1 
Property and equipment101.1 (8.2)92.9 
Identifiable intangible assets342.1 4.2 346.3 
Operating lease right-of-use-assets15.1 — 15.1 
Other non-current assets9.5 (1.5)8.0 
Total assets acquired$615.0 $(10.8)$604.2 
Liabilities assumed:
Accounts payable27.0 (1.4)25.6 
Current portion of long-term debt0.1 — 0.1 
Current portion of operating lease liabilities3.7 — 3.7 
Other current liabilities28.4 2.8 31.2 
Long-term debt, less current portion5.1 — 5.1 
Long-term operating lease liabilities, less current portion11.4 — 11.4 
Deferred taxes92.2 (35.1)57.1 
Other non-current liabilities6.6 (4.2)2.4 
Total liabilities assumed$174.5 $(37.9)$136.6 
Net assets acquired440.5 27.1 467.6 
Goodwill$728.7 $(29.2)$699.5 
The following table summarizes the identifiable intangible assets and their useful lives.
AmountUseful life
(In millions) (In years)
Customer relationships$186.4 11.0
Trademarks and tradenames26.0 10.0
Software3.7 2.0
Technology130.2 12.0
Total intangible assets with definite lives
$346.3 
Goodwill is a result of the synergies that are expected to originate from the combination of Cryovac and Liquibox solutions for the Company, as well as growth of our sustainable packaging portfolio. This goodwill is not deductible for tax purposes. The goodwill balance associated with Liquibox is included in the Food reportable segment.
16


Liquibox Supplemental Information
The following table presents the amounts of net sales and net loss attributed to Liquibox since the acquisition date that are included in our Condensed Consolidated Statements of Operations for the three months ended March 31, 2023:
(In millions)February 1, 2023 through March 31, 2023
Net sales$57.3 
Net loss$(5.4)
Pro Forma Financial Information
The following table presents the Company’s unaudited pro forma financial information for the three months ended March 31, 2023, assuming the acquisition of Liquibox had occurred on January 1, 2022. The information below reflects pro forma adjustments based on available information and certain assumptions that SEE believes are factual and supportable. The unaudited pro forma information is not necessarily indicative of the results that might have occurred had the transaction actually taken place on January 1, 2022 and is not intended to be a projection of future results and gives no effect to any future synergistic benefits that may result from the combination or the costs of integrating the acquired operations with those of the Company.
(In millions)Three Months Ended
March 31, 2023
Net sales$1,374.4 
Net earnings$70.0 
The unaudited pro forma financial information includes, where applicable, adjustments for (i) additional expense from the fair value step-up of inventory, (ii) additional amortization expense related to acquired intangible assets, (iii) additional depreciation expense related to acquired property and equipment, (iv) transaction costs and other one-time non-recurring costs, (v) additional interest expense for borrowings related to the acquisition and amortization associated with fair value adjustments of debt assumed, and (vi) associated tax-related impacts of adjustments.
Other 2023 Acquisition Activity
During the second quarter of 2023, Food had other acquisition activity resulting in a total purchase price paid of $14.9 million. The Company finalized the allocation of the consideration transferred to the fair value of assets acquired in the third quarter of 2023, resulting in an allocation to goodwill of $7.9 million. There were no other identifiable intangible assets acquired. This acquisition activity is expected to supplement our developmental efforts for sustainable packaging and accelerate our speed to market for certain sustainable solutions. This acquisition activity was not material to our Condensed Consolidated Financial Statements.
Note 6 Segments
The Company’s segment reporting structure consists of two reportable segments as follows and a Corporate category:
Food
Protective
The Company’s Food and Protective segments are considered reportable segments under FASB ASC Topic 280. Our reportable segments are aligned with similar groups of products. Corporate includes certain costs that are not allocated to the reportable segments. The Company evaluates performance of the reportable segments based on the results of each segment. The performance metric used by the Company's chief operating decision maker to evaluate performance of our reportable segments is Segment Adjusted EBITDA. The Company allocates expense to each segment based on various factors including direct usage of resources, allocation of headcount, allocation of software licenses or, in cases where costs are not clearly delineated, costs may be allocated on portion of either net trade sales or an expense factor such as cost of sales.
We allocate and disclose depreciation and amortization expense to our segments, although depreciation and amortization are not included in the segment performance metric Segment Adjusted EBITDA. We also allocate and disclose restructuring charges by segment, although they are not included in the segment performance metric Segment Adjusted EBITDA since restructuring
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charges are categorized as Special Items (as identified below). The accounting policies of the reportable segments and Corporate are the same as those applied to the Condensed Consolidated Financial Statements.
The following tables show Net sales and Segment Adjusted EBITDA by reportable segment:
Three Months Ended
March 31,
(In millions)20242023
Net sales:  
Food$868.4 $853.1 
As a % of Consolidated net sales65.3 %63.2 %
Protective461.2 495.7 
As a % of Consolidated net sales34.7 %36.8 %
Consolidated Net sales$1,329.6 $1,348.8 
 
 Three Months Ended
March 31,
(In millions)20242023
Segment Adjusted EBITDA:  
Food$189.6 $194.8 
Adjusted EBITDA Margin21.8 %22.8 %
Protective89.5 80.4 
Adjusted EBITDA Margin19.4 %16.2 %
Total Segment Adjusted EBITDA$279.1 $275.2 
The following table shows a reconciliation of Segment Adjusted EBITDA to Earnings before income tax provision:

Three Months Ended
March 31,
(In millions)20242023
Food Adjusted EBITDA$189.6 $194.8 
Protective Adjusted EBITDA89.5 80.4 
Corporate Adjusted EBITDA(0.8)(7.9)
Interest expense, net(65.1)(57.8)
Depreciation and amortization, net of adjustments(1)
(60.9)(68.9)
Special Items:
Liquibox intangible amortization(7.5)(5.0)
Liquibox inventory step-up expense (8.4)
Restructuring charges(2)
(15.5)1.2 
Other restructuring associated costs(6.8)0.2 
Foreign currency exchange loss due to highly inflationary economies(4.9)(2.6)
Loss on debt redemption and refinancing activities (4.9)
Contract terminations0.1  
Charges related to acquisition and divestiture activity(3)
1.9 (16.9)
Other Special Items(4)
(0.5)(7.5)
Pre-tax impact of Special Items(33.2)(43.9)
Earnings before income tax provision$119.1 $96.7 
(1)Net of Liquibox intangible amortization, which is included under Special Items. Depreciation and amortization by segment were as follows:

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Three Months Ended
March 31,
(In millions)20242023
Food$46.9 $46.7 
Protective21.5 27.2 
Total Company depreciation and amortization(i)
$68.4 $73.9 
Liquibox intangible amortization(7.5)(5.0)
Depreciation and amortization, net of adjustments$60.9 $68.9 
(i)    Includes share-based incentive compensation of $8.7 million and $18.0 million for the three months ended March 31, 2024 and 2023, respectively.
(2)Restructuring charges by segment were as follows:
Three Months Ended
March 31,
(In millions)20242023
Food$8.6 $(0.9)
Protective6.9 (0.3)
Total Company restructuring charges$15.5 $(1.2)
(3)Charges related to acquisition and divestiture activity for the three months ended March 31, 2024 primarily consists of income recognized on the final purchase price settlement related to the Liquibox acquisition.
(4)Other Special Items for the three months ended March 31, 2023 primarily relate to a one-time, non-cash cumulative translation adjustment (CTA) loss recognized due to the wind-up of one of our legal entities.

Assets by Reportable Segments

The following table shows assets allocated by reportable segment. Assets allocated by reportable segment include: trade receivables, net; inventory, net; property and equipment, net; goodwill; intangible assets, net; and leased systems, net.

(In millions)March 31, 2024December 31, 2023
Assets allocated to segments:  
Food$3,396.6 $3,386.4 
Protective2,662.6 2,663.4 
Total segments6,059.2 6,049.8 
Assets not allocated:
Cash and cash equivalents$352.8 $346.1 
Income tax receivables27.6 44.9 
Other receivables92.2 94.2 
Advances and deposits69.7 72.8 
Deferred taxes130.7 130.8 
Other467.1 462.0 
Total$7,199.3 $7,200.6 
 
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Note 7 Inventories, net

The following table details our inventories, net.
(In millions)March 31, 2024December 31, 2023
Raw materials$162.2 $165.3 
Work in process180.1 178.5 
Finished goods447.9 430.5 
Total$790.2 $774.3 

Note 8 Property and Equipment, net

The following table details our property and equipment, net.
(In millions)March 31, 2024December 31, 2023
Land and improvements$46.7 $47.5 
Buildings837.8 835.8 
Machinery and equipment2,807.5 2,811.5 
Other property and equipment141.9 142.0 
Construction-in-progress230.0 227.0 
Property and equipment, gross4,063.9 4,063.8 
Accumulated depreciation and amortization(2,652.7)(2,647.4)
Property and equipment, net$1,411.2 $1,416.4 
The following table details our interest cost capitalized and depreciation and amortization expense for property and equipment and finance lease ROU assets.
Three Months Ended
March 31,
(In millions)20242023
Interest cost capitalized$3.3 $2.5 
Depreciation and amortization expense(1)
$44.8 $40.7 
 
(1)Includes amortization expense of finance lease ROU assets of $2.0 million and $2.5 million for the three months ended March 31, 2024 and 2023, respectively.
Note 9 Goodwill and Identifiable Intangible Assets, net
Goodwill
We review goodwill for impairment on a reporting unit basis annually during the fourth quarter of each year and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Since the date of our last annual goodwill impairment assessment, there have been no significant events or circumstances that have indicated a potential for impairment.
Allocation of Goodwill to Reporting Segment
The following table shows our goodwill balances by reportable segment: 
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(In millions)FoodProtectiveTotal
Gross Carrying Value at December 31, 2023$1,284.3 $1,798.1 $3,082.4 
Accumulated amortization(1)
(49.1)(140.8)(189.9)
Carrying Value at December 31, 2023$1,235.2 $1,657.3 $2,892.5 
Currency translation(0.9)(3.9)(4.8)
Carrying Value at March 31, 2024$1,234.3 $1,653.4 $2,887.7 
(1)There was no change to our accumulated amortization balance during the three months ended March 31, 2024.
Identifiable Intangible Assets, net
The following tables summarize our identifiable intangible assets, net with definite and indefinite useful lives. As of March 31, 2024, there were no impairment indicators present.
 March 31, 2024December 31, 2023
(In millions)Gross
Carrying Value
Accumulated AmortizationNetGross
Carrying Value
Accumulated AmortizationNet
Customer relationships$286.5 $(74.2)$212.3 $287.7 $(69.3)$218.4 
Trademarks and tradenames57.0 (20.6)36.4 57.0 (19.4)37.6 
Software151.2 (117.3)33.9 148.2 (112.8)35.4 
Technology196.8 (63.8)133.0 197.5 (60.1)137.4 
Contracts11.4 (10.3)1.1 11.5 (10.2)1.3 
Total intangible assets with definite lives702.9 (286.2)416.7 701.9 (271.8)430.1 
Trademarks and tradenames with indefinite lives8.9 — 8.9 8.9 — 8.9 
Total identifiable intangible assets, net$711.8 $(286.2)$