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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, 2022
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 146,084,428 shares of the registrant’s common stock, par value $0.10 per share, issued and outstanding as of April 29, 2022.



 Page
PART I. FINANCIAL INFORMATION 
PART II.  OTHER INFORMATION 





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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 or 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, 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, currency translation and devaluation effects, changes in raw material pricing and availability, competitive conditions, the success of new product offerings, consumer preferences, the effects of animal and food-related health issues, the effects of epidemics or pandemics, including the Coronavirus Disease 2019, negative impacts related to the ongoing conflict between Russia and Ukraine and related sanctions, export restrictions and other counteractions thereto, 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, the tax benefit associated with the Settlement agreement (as defined in Note 18 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this report), 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, 2021 as filed with the SEC, and in any of our subsequent SEC filings. Any forward-looking statement made by us in this report 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, 2022December 31, 2021
Assets  
Current assets:  
Cash and cash equivalents$278.2 $561.0 
Trade receivables, net of allowance for credit losses of $12.6 in 2022 and $11.1 in 2021
677.5 620.3 
Income tax receivables17.1 28.8 
Other receivables80.8 83.7 
Inventories, net of inventory reserves of $26.3 in 2022 and $24.1 in 2021 (Note 7)
843.7 725.7 
Prepaid expenses and other current assets49.7 50.1 
Total current assets1,947.0 2,069.6 
Property and equipment, net (Note 8)
1,252.3 1,232.0 
Goodwill (Note 9)
2,192.2 2,189.4 
Identifiable intangible assets, net (Note 9)
150.9 152.6 
Deferred taxes138.2 138.4 
Non-current assets held for sale 1.5 
Operating lease right-of-use-assets (Note 4)
65.5 63.8 
Other non-current assets370.9 382.0 
Total assets$6,117.0 $6,229.3 
Liabilities and Stockholders' Equity  
Current liabilities:  
Short-term borrowings (Note 13)
$1.1 $1.3 
Current portion of long-term debt (Note 13)
9.2 487.2 
Current portion of operating lease liabilities (Note 4)
21.2 21.2 
Accounts payable958.1 959.9 
Accrued restructuring costs (Note 12)
8.6 10.2 
Income tax payable40.6 22.7 
Other current liabilities444.1 504.8 
Total current liabilities1,482.9 2,007.3 
Long-term debt, less current portion (Note 13)
3,689.5 3,219.6 
Long-term operating lease liabilities, less current portion (Note 4)
45.8 44.5 
Deferred taxes45.7 46.7 
Non-current liabilities held for sale 0.9 
Other non-current liabilities662.7 661.6 
Total liabilities5,926.6 5,980.6 
Commitments and contingencies (Note 18)
Stockholders’ equity:  
Preferred stock, $0.10 par value per share, 50,000,000 shares authorized; no shares issued in 2022 and 2021
  
Common stock, $0.10 par value per share, 400,000,000 shares authorized; shares issued: 233,158,607 in 2022 and 232,483,281 in 2021; shares outstanding: 146,082,455 in 2022 and 148,099,157 in 2021
23.3 23.2 
Additional paid-in capital2,122.9 2,123.4 
Retained earnings2,909.3 2,790.7 
Common stock in treasury, 87,076,152 shares in 2022 and 84,384,124 shares in 2021
(3,939.0)(3,754.7)
Accumulated other comprehensive loss, net of taxes (Note 20)
(926.1)(933.9)
Total stockholders’ equity190.4 248.7 
Total liabilities and stockholders’ equity$6,117.0 $6,229.3 
 
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)20222021
Net sales$1,417.6 $1,267.1 
Cost of sales940.6 866.0 
Gross profit477.0 401.1 
Selling, general and administrative expenses205.0 188.9 
Amortization expense of intangible assets9.4 9.7 
Restructuring charges (Note 12)
0.5  
Operating profit262.1 202.5 
Interest expense, net(38.9)(43.1)
Other (expense) income, net (Note 21)
(14.2)1.0 
Earnings before income tax provision209.0 160.4 
Income tax provision (Note 17)
59.4 54.6 
Net earnings from continuing operations149.6 105.8 
(Loss) Gain on sale of discontinued operations, net of tax(0.4)4.3 
Net earnings$149.2 $110.1 
Basic:  
Continuing operations$1.01 $0.68 
Discontinued operations 0.03 
Net earnings per common share - basic (Note 22)
$1.01 $0.71 
Diluted:
Continuing operations$1.00 $0.68 
Discontinued operations 0.03 
Net earnings per common share - diluted (Note 22)
$1.00 $0.71 
Weighted average number of common shares outstanding: (Note 22)
Basic147.6 154.1 
    Diluted149.5 155.4 
 
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,
20222021
(In USD millions)GrossTaxesNetGrossTaxesNet
Net earnings$149.2 $110.1 
Other comprehensive income (loss):  
Recognition of pension items$1.1 $(0.3)0.8 $1.7 $(1.9)(0.2)
Unrealized gains on derivative instruments for net investment hedge6.7 (1.7)5.0 23.3 (5.8)17.5 
Unrealized (losses) gains on derivative instruments for cash flow hedge(2.1)0.6 (1.5)2.6 (0.8)1.8 
Foreign currency translation adjustments3.5  3.5 (25.2) (25.2)
Other comprehensive income (loss)$9.2 $(1.4)7.8 $2.4 $(8.5)(6.1)
Comprehensive income, net of taxes$157.0 $104.0 
 
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, 2021$23.2 $2,123.4 $2,790.7 $(3,754.7)$(933.9)$248.7 
Effect of share-based incentive compensation0.1 (7.4)— — — (7.3)
Stock issued for profit sharing contribution paid in stock— 6.9 — 15.8 — 22.7 
Repurchases of common stock— — — (200.1)— (200.1)
Recognition of pension items, net of taxes— — — — 0.8 0.8 
Foreign currency translation adjustments— — — — 3.5 3.5 
Unrealized gain on derivative instruments, net of taxes— — — — 3.5 3.5 
Net earnings— — 149.2 — — 149.2 
Dividends on common stock ($0.20 per share)
— — (30.6)— — (30.6)
Balance at March 31, 2022$23.3 $2,122.9 $2,909.3 $(3,939.0)$(926.1)$190.4 
Balance at December 31, 2020$23.2 $2,093.0 $2,400.7 $(3,380.9)$(963.5)$172.5 
Effect of share-based incentive compensation— (2.4)— — — (2.4)
Stock issued for profit sharing contribution paid in stock— 0.2 — 27.8 — 28.0 
Repurchases of common stock— — — (175.5)— (175.5)
Recognition of pension items, net of taxes— — — — (0.2)(0.2)
Foreign currency translation adjustments— — — — (25.2)(25.2)
Unrealized gain on derivative instruments, net of taxes— — — — 19.3 19.3 
Net earnings— — 110.1 — — 110.1 
Dividends on common stock ($0.16 per share)
— — (25.2)— — (25.2)
Balance at March 31, 2021$23.2 $2,090.8 $2,485.6 $(3,528.6)$(969.6)$101.4 
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)20222021
Net earnings$149.2 $110.1 
Adjustments to reconcile net earnings to net cash provided by operating activities  
Depreciation and amortization45.3 45.5 
Share-based incentive compensation17.3 11.1 
Profit sharing expense8.6 5.8 
Loss on debt redemption and refinancing activities0.7  
Provision for allowance for credit losses on trade receivables1.8 0.7 
Provisions for inventory obsolescence4.5 3.2 
Deferred taxes, net(2.3)0.9 
Net loss (gain) on sale of business0.4 (2.2)
Impairment of equity investment15.5  
Other non-cash items(3.1)3.4 
Changes in operating assets and liabilities:  
Trade receivables, net(57.1)(56.0)
Inventories, net(119.9)(70.9)
Accounts payable10.5 69.3 
Customer advance payments1.7 2.6 
Income tax receivable/payable30.2 44.4 
Other assets and liabilities(54.9)(88.0)
Net cash provided by operating activities$48.4 $79.9 
Cash flows from investing activities:  
Capital expenditures(67.0)(43.9)
Proceeds related to sale of business and property and equipment, net7.1 0.6 
Business acquired in purchase transactions, net of cash acquired(9.1) 
Payments associated with debt, equity and equity method investments
(1.3)(6.0)
Settlement of foreign currency forward contracts1.0 8.2 
Other investing activities 0.1 
Net cash used in investing activities$(69.3)$(41.0)
Cash flows from financing activities:  
Net (payments) proceeds of short-term borrowings(0.1)1.7 
Proceeds from long-term debt0.8  
Payments of long-term debt (2.8)
Payments of debt modification/extinguishment costs(4.1) 
Dividends paid on common stock(31.1)(25.8)
Impact of tax withholding on share-based compensation(24.8)(13.7)
Repurchases of common stock(200.1)(177.1)
Principal payments related to financing leases(2.7)(2.6)
Net cash used in financing activities$(262.1)$(220.3)
Effect of foreign currency exchange rate changes on cash and cash equivalents$0.2 $2.7 
Cash Reconciliation:
Cash and cash equivalents561.0 548.7 
Restricted cash and cash equivalents  
Balance, beginning of period$561.0 $548.7 
Net change during the period(282.8)(178.7)
Cash and cash equivalents278.2 370.0 
Restricted cash and cash equivalents  
Balance, end of period$278.2 $370.0 
Supplemental Cash Flow Information:  
Interest payments, net of amounts capitalized$41.0 $43.3 
Income tax payments (refunds), net$24.7 $(1.6)
Restructuring payments including associated costs$12.0 $5.0 
Non-cash items:
Transfers of shares of common stock from treasury for profit-sharing contributions$22.7 $28.0 
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 integrating high-performance materials, automation, equipment and services. Sealed Air Corporation designs and delivers packaging solutions that protect goods, preserve food, automate packaging processes, enable eCommerce and digital connectivity for packaged goods. Our packaging solutions help customers automate their operations to be increasingly touchless and more resilient, safer, less wasteful, and enhance brand engagement with consumers. We deliver our packaging solutions to an array of end markets including fresh proteins, foods, fluids, medical and healthcare, eCommerce, logistics and omnichannel fulfillment operations, and industrials.
Our portfolio of packaging solutions includes CRYOVAC® brand food packaging, SEALED AIR® brand protective packaging, AUTOBAG® brand automated packaging, BUBBLE WRAP® brand packaging and SEE Touchless Automation™ solutions. We have established leading market positions through our differentiated packaging solutions, well-established customer relationships, iconic brands, and global scale and market access.
We conduct substantially all of our business through two wholly-owned subsidiaries, Cryovac, LLC and Sealed Air Corporation (US). 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, 2022 and our Condensed Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 have been made. The results set forth in our Condensed Consolidated Statements of Operations for the three months ended March 31, 2022 and in our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. The Condensed Consolidated Balance Sheet as of December 31, 2021 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 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 included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (“2021 Form 10-K”), which was filed with the SEC on February 22, 2022, 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 Issued Accounting Standards” of our audited consolidated financial statements and notes thereto included in our 2021 Form 10-K.
Impact of Inflation and Currency Fluctuation
Argentina
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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 subsidiaries 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) income, net on the Condensed Consolidated Statements of Operations. The Company recorded $1.0 million and $1.4 million of remeasurement losses for the three months ended March 31, 2022 and 2021, respectively.
Note 2 Recently Adopted and Issued Accounting Standards
Recently Adopted Accounting Standards
In July 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-05, Leases (Topic 842): Lessors - Certain Leases with Variable Lease Payments (“ASU 2021-05”). ASU 2021-05 requires a lessor to classify a lease with variable lease payments that do not depend on an index or rate as an operating lease at commencement if the lease would have been classified as a sales-type or direct financing lease and the lessor would have recognized a selling loss at lease commencement. The Company adopted ASU 2021-05 on January 1, 2022. The adoption did not have a material impact on the Company's Condensed Consolidated Financial Statements.
Recently Issued Accounting Standards
In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance ("ASU 2021-10"). ASU 2021-10 requires business entities to disclose information about certain types of government assistance received in the notes to the financial statements. ASU 2021-10 is effective for annual periods beginning after December 15, 2021. We do not believe that the adoption of ASU 2021-10 will have an impact on the Company's Condensed Consolidated Financial Statements with the exception of new disclosures, if government assistance provided to the Company were to be material in the future.
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with Topic 606, Revenue from Contracts with Customers. The standard will not impact acquired contract assets or liabilities from business combinations occurring prior to the adoption date. ASU 2021-08 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. The impact of adoption on the Company's Condensed Consolidated Financial Statements will be prospective only and will depend on the magnitude of any future business acquisitions.
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 equipment and systems, products, and services to and/or through a large number of distributors, fabricators, converters, eCommerce and mail order fulfillment firms, and contract packaging firms as well as directly to end-users such as food processors, food service businesses, supermarket retailers, pharmaceutical companies, healthcare facilities, medical device manufacturers, and other manufacturers.
As discussed in Note 6, “Segments,” our reporting segments are Food and Protective. Our Food applications are largely sold directly to end customers, while our Protective products 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, plant-based and dairy (solid and liquids) markets worldwide. Food offers integrated packaging materials and automated equipment solutions to
10


increase food safety, extend shelf life, reduce food waste, automate processes and optimize total cost. Its materials, automated equipment and service enables 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, and CRYOVAC® brand Auto Pouch System. 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 eCommerce, 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 eCommerce/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. In addition, we provide temperature assurance packaging solutions under the KevothermalTM and TempGuardTM brands.
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 an increase of $0.2 million and a reduction of $0.2 million for the three months ended March 31, 2022 and 2021, 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.
Disaggregated Revenue
For the three months ended March 31, 2022 and 2021, revenues from contracts with customers summarized by Segment and Geography were as follows:
Three Months Ended
March 31, 2022
(In millions)FoodProtectiveTotal
Americas$524.9 $399.9 $924.8 
EMEA166.6 123.8 290.4 
APAC110.4 84.6 195.0 
Topic 606 Segment Revenue801.9 608.3 1,410.2 
Non-Topic 606 Revenue (Leasing: Sales-type and Operating)5.8 1.6 7.4 
Total$807.7 $609.9 $1,417.6 

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Three Months Ended
March 31, 2021
(In millions)FoodProtectiveTotal
Americas$434.8 $348.1 $782.9 
EMEA151.9 128.5 280.4 
APAC109.9 86.8 196.7 
Topic 606 Segment Revenue696.6 563.4 1,260.0 
Non-Topic 606 Revenue (Leasing: Sales-type and Operating)5.6 1.5 7.1 
Total$702.2 $564.9 $1,267.1 
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, which can be used to purchase both automated and standard range equipment. 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, 2022 and December 31, 2021:
(In millions)March 31, 2022December 31, 2021
Contract assets$0.7 $1.2 
Contract liabilities$19.3 $20.2 
The contract liability balances represent deferred revenue, primarily related to equipment accruals. Revenue recognized in the three months ended March 31, 2022 and 2021 that was included in the contract liability balance at the beginning of the period was $4.4 million and $5.8 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, 2022 and December 31, 2021, as well as the expected timing of recognition of that transaction price.
(In millions)March 31, 2022December 31, 2021
Short-Term (12 months or less)(1)
$15.7 $15.9 
Long-Term3.6 4.3 
Total transaction price$19.3 $20.2 
(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 automated 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.
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All lease payments are primarily fixed in nature and therefore captured in the lease receivable. Our sales-type lease receivable balances at March 31, 2022 and December 31, 2021 were as follows:
(In millions)March 31, 2022December 31, 2021
Short-Term (12 months or less)$5.9 $5.7 
Long-Term17.7 18.8 
Lease receivables$23.6 $24.5 
Sales-type and operating lease revenue was less than 1% of net trade sales for the three months ended March 31, 2022 and year ended December 31, 2021.
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, 2022December 31, 2021
Other non-current assets:
Finance leases - ROU assets$58.2 $58.0 
Finance leases - Accumulated depreciation(28.8)(27.3)
Operating lease right-of-use-assets:
Operating leases - ROU assets139.8 133.5 
Operating leases - Accumulated depreciation(74.3)(69.7)
Total lease assets$94.9 $94.5 
Current portion of long-term debt:
Finance leases$(9.2)(10.2)
Current portion of operating lease liabilities:
Operating leases (21.2)(21.2)
Long-term debt, less current portion:
Finance leases(18.9)(19.2)
Long-term operating lease liabilities, less current portion:
Operating leases(45.8)(44.5)
Total lease liabilities$(95.1)$(95.1)
At March 31, 2022, estimated future minimum annual rental commitments under non-cancelable real and personal property leases were as follows:
(In millions)Finance leasesOperating leases
Remainder of 2022$8.2 $18.6 
20237.8 19.6 
20243.0 13.6 
20252.1 9.6 
20262.0 6.9 
Thereafter10.0 6.8 
Total lease payments33.1 75.1 
Less: Interest(5.0)(8.1)
Present value of lease liabilities$28.1 $67.0 
The following lease cost is included in our Condensed Consolidated Statements of Operations:
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Three Months Ended
March 31,
(In millions)20222021
Lease cost(1)
Finance leases
Amortization of ROU assets$2.7 $2.6 
Interest on lease liabilities0.3 0.4 
Operating leases8.5 7.7 
Short-term lease cost0.4 1.1 
Variable lease cost1.6 1.9 
Total lease cost$13.5 $13.7 

(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 ROU assets included in our Condensed Consolidated Balance Sheets:
Three Months Ended
March 31,
(In millions)20222021
Other information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - finance leases$1.1 $1.8 
Operating cash flows - operating leases$8.7 $8.0 
Financing cash flows - finance leases$2.7 $2.6 
ROU assets obtained in exchange for new finance lease liabilities$1.4 $1.1 
ROU assets obtained in exchange for new operating lease liabilities$9.2 $2.4 
Three Months Ended
March 31,
20222021
Weighted average information:
Finance leases
Remaining lease term (in years)5.96.1
Discount rate4.6 %4.8 %
Operating leases
Remaining lease term (in years)4.34.5
Discount rate4.5 %5.0 %

Note 5 Acquisition and Divestiture Activity
Acquisition of Foxpak Flexibles Ltd.

On February 2, 2022, SEE acquired Foxpak Flexibles Ltd. (“Foxpak”), a privately-owned Irish packaging solutions company. Foxpak is a digital printing pioneer that partners with brands to deliver highly decorated packaging solutions; stand-up and spout pouches, and sachets that serve a variety of markets including food retail, pet food, seafood, and snacks. This transaction resulted in a purchase price paid of $9.1 million. The Company allocated the consideration transferred to the fair value of assets acquired and liabilities assumed, resulting in an allocation to goodwill of $5.0 million and $2.5 million to identifiable intangible
14


assets. The acquisition is included in our Food reporting segment. Goodwill is not deductible for tax purposes. A deferred tax liability of $0.3 million on identifiable intangible assets was recorded on the opening balance sheet.
Divestiture of Reflectix, Inc.
On November 1, 2021, the Company completed the sale of Reflectix, Inc. (“Reflectix”), a wholly-owned subsidiary that sells branded reflective insulation solutions, with operations located in Markleville, Indiana. The decision to sell this business was consistent with the Company's overall strategic priorities focused on packaging solutions. Reflectix was previously included within the Protective reporting segment.
The disposal does not represent a strategic shift that will have a major effect on our operations and financial results and therefore did not qualify as a discontinued operation.
The selling price of the business was $82.5 million, paid in cash during the fourth quarter 2021. We recorded a $45.3 million pre-tax gain on the sale of the business, within Gain (Loss) on sale of businesses and property and equipment on the Consolidated Statements of Operations for the year ended December 31, 2021. The business had a net carrying value of $35.8 million, which included inventory of $6.8 million, trade receivables of $6.6 million, property and equipment of $1.0 million, and goodwill of $23.2 million. The goodwill is not deductible for tax purposes. The assets were partially offset by accrued liabilities which were individually immaterial. We recorded $17.3 million in tax expense related to the gain from the sale of Reflectix within Income tax provision on the Consolidated Statements of Operations for the year ended December 31, 2021.
The sales price is subject to final and customary purchase price true-ups. We maintain no on-going investment or relationship that would result in the sold business becoming a related party.
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 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:
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Three Months Ended
March 31,
(In millions)20222021
Net sales:  
Food$807.7 $702.2 
As a % of Consolidated net sales57.0 %55.4 %
Protective609.9 564.9 
As a % of Consolidated net sales43.0 %44.6 %
Consolidated Net sales$1,417.6 $1,267.1 
 
 Three Months Ended
March 31,
(In millions)20222021
Segment Adjusted EBITDA:  
Food$200.4 $156.9 
Adjusted EBITDA Margin24.8 %22.3 %
Protective127.4 109.9 
Adjusted EBITDA Margin20.9 %19.5 %
Total Segment Adjusted EBITDA$327.8 $266.8 
The following table shows a reconciliation of Segment Adjusted EBITDA to Earnings before income tax provision:

Three Months Ended
March 31,
(In millions)20222021
Food Adjusted EBITDA$200.4 $156.9 
Protective Adjusted EBITDA127.4 109.9 
Corporate Adjusted EBITDA