Latest Quarterly and Full-Year Results
Segment and Operational Highlights
Packaging operations recorded a $32 million decline in sales during the fourth quarter, reflecting a 1% reduction in price and a 1% reduction in volume. These declines were offset by a $40 million favorable impact from foreign exchange. Innovation sales growth reached $56 million in the fourth quarter and $213 million for the full year, representing 2.5% of total net sales.
Full-year performance was impacted by the 2024 divestiture of the bleached paperboard manufacturing facility in Augusta, Georgia, which resulted in a $150 million negative sales impact. Packaging operations saw a $97 million net decline in annual sales as prices fell 1% and volumes remained flat.
Business and Operations Update
The manufacturing facility in Waco, Texas, is substantially complete, with commercial production ramping up following an October 2025 start-up. Total project costs are projected at $1.67 billion, with $1.58 billion spent through the end of 2025.
The company has initiated a 90-day comprehensive review of its organization structure, operations, and footprint. A Transformation Office was established under a new Chief Transformation Officer to manage productivity and cost-reduction initiatives. Operational changes in 2025 included the closure of facilities in Middletown and East Angus.
M&A and Strategic Moves
Management is conducting a selective review of the company’s asset portfolio. During 2025, Graphic Packaging returned $281 million to stockholders through dividends and share repurchases. The company repurchased 6.8 million shares of common stock for $150 million, reducing net shares outstanding by 2.3%. Total debt at the end of 2025 was $5,592 million, with net debt at $5,331 million.
Guidance and Outlook
For the 2026 fiscal year, the company issued net sales guidance between $8.4 billion and $8.6 billion. Adjusted EBITDA is projected in the range of $1.05 billion to $1.25 billion. This outlook includes a $130 million negative impact from temporary production curtailments intended to reduce inventory levels. Capital spending for 2026 is expected to be approximately $450 million, while the adjusted free cash flow target is $700 million to $800 million.
Performance Summary
Full-year 2025 net income was $444 million on revenue of $8.6 billion. Packaging volumes were flat for the year, while pricing declined by 1%. The net leverage ratio increased to 3.8x from 3.0x at the end of 2024.