Graphic Packaging Holding Co.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 5 May 2026: press release. Guidance figures: 5 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Net loss against prior-year profit: Net loss was $43 million, or $(0.14) per diluted share, against net income of $127 million, or $0.42 a year earlier. Special items and amortization of purchased intangibles totaled $71 million in 2026 and $27 million in 2025. Source
• Adjusted EPS fell to $0.09: Excluding non-recurring and special items and amortization of purchased intangibles, Adjusted Net Income was $28 million, or $0.09 per diluted share, against $154 million, or $0.51, a year earlier. Source
• Adjusted EBITDA fell $133 million: Adjusted EBITDA was $232 million against $365 million. Net Performance cost $56 million, price, volume and mix $46 million, and input and other cost inflation $37 million; a $6 million foreign exchange benefit partly offset. Source
• Business review produced actions: Following the 90-day review, the company identified actions to improve profitability and overall performance of the business. Source
• Inventory reduced $48 million: Inventories, net were $1,718 million at March 31, 2026, against $1,766 million at December 31, 2025; the February release showed $1,753 million for that date. Source
• Net leverage rose to 4.4x: The Net Leverage Ratio was 4.4x, up from 3.8x at year-end 2025. Source
• Full-year guidance reiterated: Net Sales, Adjusted EBITDA and Adjusted EPS guidance was reiterated with the same ranges as in the February release. Source

“First quarter results were strong relative to expectations as we delivered towards the high end of our guidance”

Robbert Rietbroek, President and Chief Executive Officer

Guidance

What changed from last quarter

• Guidance kept: Full-year 2026 Net Sales, Adjusted EBITDA and Adjusted EPS guidance reiterated; Adjusted Cash Flow and capital spending guidance also kept. Source
• New: The 90-day business review that the February release said was initiated is now complete, and actions were identified. Source
• New: A divestiture of non-core assets in Croatia is pending as part of portfolio simplification. Source
• New: The global commercial organization was realigned to include a dedicated global and multi-national account team. Source
• New: Low-return projects were cancelled, with over $200 million of capital avoidance expected over the next few years. Source

Results and growth drivers

• Net Sales rose 2 percent: Net Sales were $2,156 million against $2,120 million a year earlier. Volume rose 1% and foreign exchange added $50 million, while price reduced Net Sales by 2%. Source
• Net loss against prior-year profit: Net loss was $43 million, or $(0.14) per diluted share, against net income of $127 million, or $0.42 a year earlier. Special items and amortization of purchased intangibles totaled $71 million in 2026 and $27 million in 2025. Source
• Adjusted EPS fell to $0.09: Excluding non-recurring and special items and amortization of purchased intangibles, Adjusted Net Income was $28 million, or $0.09 per diluted share, against $154 million, or $0.51, a year earlier. Source

Pricing, volume and innovation

• Volume and currency offset price: Net Sales rose $36 million: volume added $18 million and favorable foreign exchange $50 million, while price reduced sales by $32 million. Source
• Innovation sales growth of $42 million: Innovation Sales Growth was $42 million in the quarter. Source
• How innovation sales are defined: Innovation Sales Growth is defined as incremental sales of products delivering a significant change in materials, functionality or design. Source

“Our year-over-year improvement in volume and net sales demonstrated the resilience of our business as we successfully navigated weather and other external disruptions to our operations.”

Robbert Rietbroek, President and Chief Executive Officer

Costs, margin and EBITDA

• Adjusted EBITDA fell $133 million: Adjusted EBITDA was $232 million against $365 million. Net Performance cost $56 million, price, volume and mix $46 million, and input and other cost inflation $37 million; a $6 million foreign exchange benefit partly offset. Source
• Adjusted EBITDA margin narrowed: Adjusted EBITDA margin was 10.8% in the quarter against 17.2% in the year-earlier quarter. Source
• Reported EBITDA fell 55 percent: Reported EBITDA was $159 million against $353 million. The release also lists $71 million of special charges and $2 million of other non-recurring items. Source

Business review and cost actions

• Business review produced actions: Following the 90-day review, the company identified actions to improve profitability and overall performance of the business. Source
• $60 million cost reduction delivered: Management said it is delivering on a $60 million cost reduction commitment. Source
• Over 500 roles removed: The organization was streamlined by over 500 roles, primarily salaried, through employee separations and elimination of vacant roles. Source
• Low-return projects cancelled: Projects with low returns were cancelled, which the release says avoids over $200 million of capital over the next few years. Source

“We completed our 90‑day business review and are taking decisive actions to optimize our operational footprint, reduce structural costs, and impose greater discipline across capital and operating decisions.”

Robbert Rietbroek, President and Chief Executive Officer

Commercial organization and innovation

• Global account team formed: The commercial organization was realigned around a dedicated global and multi-national account team for more consistent service to global customers. Source
• Patent filings and awards: Thirteen new patents were filed in the quarter, and the portfolio is about 3,100 patents. Innovation awards were received for sustainable packaging, including two WorldStar 2026 Best of the Best awards. Source
• Early wins from service focus: Management said a renewed emphasis on service and customer relationships is already providing early wins. Source

Cash, inventory and capital

• Inventory reduced $48 million: Inventories, net were $1,718 million at March 31, 2026, against $1,766 million at December 31, 2025; the February release showed $1,753 million for that date. Source
• Capital spending cut sharply: Capital spending was $140 million against $313 million a year earlier. Adjusted Cash Flow was $(183) million against $(442) million. Source
• Net leverage rose to 4.4x: The Net Leverage Ratio was 4.4x, up from 3.8x at year-end 2025. Source
• Dividends paid in the quarter: Regular dividends of about $32 million were returned to stockholders. The release does not state share repurchases for the quarter. Source
• Debt levels at quarter end: Total debt was $5,772 million and net debt $5,583 million, against $5,592 million and $5,331 million at year-end 2025. Source

2026 guidance and capital plan

• Capital spending plan reaffirmed: 2026 capital spending guidance of about $450 million was reaffirmed. The release gives 2025 capital spending as $922 million, while the February release gave $935 million. Source
• Full-year guidance reiterated: Net Sales, Adjusted EBITDA and Adjusted EPS guidance was reiterated with the same ranges as in the February release. Source
• Cash flow target kept: The Adjusted Cash Flow target was kept at $700 million to $800 million, a measure called Adjusted Free Cash Flow in the February release. Source

Coming up, as management said on 5 May 2026

• Priorities for the coming periods: Management said it is focused on expanding margins, accelerating free cash flow, strengthening the balance sheet and deploying capital with rigor. Source
• Adjusted Cash Flow target delivery: Working capital initiatives, including inventory reduction, are described as supporting delivery of the 2026 Adjusted Cash Flow target range. Source

Figures management reported

Risks management discussed

• External: Incremental inflation affected the quarter; management said it mitigated the effect on bottom-line performance. Source
• Operational: Weather and other external disruptions affected operations during the quarter. Source
• Demand: Price declines reduced Net Sales by $32 million, a 2% decrease in the quarter. Source

Earlier plans management reported on

• Not stated: Management said it is delivering on the $60 million cost reduction commitment. Source
• Not stated: Management said it continues to expect the Adjusted Cash Flow target range for 2026. Source

Other quarters

• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.