Sonoco Products Company

Thank you, Rob, and good morning, everyone. Yesterday evening, we issued a news release and posted an investor presentation that reviews Sunoco's 2025 first quarter financial results. Both are posted on our investor relations section of our website at sunoco.com. A replay of today's conference call will be available on our website, and we'll post a transcript later this week. If you would turn to slide two, I would remind you that during today's call, we will discuss a number of forward-looking statements based on current expectations, estimates, and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Additionally, today's presentation includes the use of non-GAAP financial measures, which management believes provides useful information to investors about the company's financial condition and results of operations. Further information about the company's use of non-GAAP financial measures, including definitions as well as reconciliations to GAAP measures, is also available on the investor relations section of our website. Finally, references to certain financial metrics along with corresponding year-over-year comparable results made on this call are on a full company basis, except when specifically referred to for continuing operations or for discontinued operations. Joining me on this call today is Howard Coker, President and CEO, Roger Fuller, Chief Operating Officer, and Jerry Cheatham, Interim Chief Financial Officer. For today's call, we will have prepared remarks followed by a Q&A. If you'll now turn to slide four in our presentation, I'll now turn the call over to Howard.

Thank you, Roger, and good morning, everyone. Let me start. Our first quarter results demonstrated the strength of the new Sunoco as our global team achieved record top line and adjusted EBITDA performance. Slide five shows net sales were 31%. or grew 31%, and adjusted EBITDA was up 38%, while adjusted earnings were up 23% despite higher-than-expected interest expenses, taxes, and the negative impact from currency translation. I'll let Jerry go through the key drivers for the quarter, but overall, we are pleased with the improvement in both our consumer packaging and industrial packaging segments. The 127% growth in adjusted EBITDA on the consumer segment reflects a full quarter of the EVOSIS acquisition, along with strong volume mix from our legacy metal and rigid paper can businesses and a positive price-cost environment. The industrial segment generated a 6% improvement in adjusted EBITDA, stemming from a year-over-year improvement in price cost and productivity. Volume was down low single digits in the quarter, Flat results in South America was offset by results in the rest of our served markets. As shown on slide six, we completed the sale of the Thermoform and Flexibles business to Topan Holdings on time and as expected. We received approximately $1.8 billion in cash for the business, which generated approximately $1.56 billion in after-tax proceeds, which we used to significantly reduce and strengthen our balance sheet. We do extend our best wishes for continued success to our approximately 4,500 former TFP teammates and their new SOPAN team. On April 1, we completed the first phase of the integration of EBIOSIS by rebranding the business to NOCO Metal Packaging, EMEA. As shown on slide 7, we're changing our digital imagery as well as physical signage overall, while early, it's been a real nice start to the integration. We're going to treat our global metal packaging businesses as a single enterprise to better capture the best ideas, innovations, and synergies. Our integration efforts produce strong synergy savings across the global metal packaging enterprise in the first quarter, and we now believe we should be able to achieve approximately $40 million of savings in 2025 on our way towards our two-year synergy target of $100 million. Working together, our global can businesses are also identifying long-term savings and commercial opportunities that will benefit our customers for years to come. We're encouraged by the performance of our combined global metal packaging business, and we continue to find opportunities to work with our customers to provide even greater value to enhance innovation and a much stronger global supply chain. After one quarter together, our global metal packaging sales are tracking at our expectations and adjusted EBITDA margins was near 16%. Our U.S. metal packaging business had strong year-over-year results as the business achieved 10% organic volume mix improvement, a strong growth in aerosols and food cans coming from both existing customer demand and new customer wins. Adjusted EBITDA for our EMEA metal packaging business was up approximately 23% in the first quarter on productivity savings and positive year-over-year price-cost environment. Can volumes in Europe reflect the slower market conditions in the region, but we're encouraged by new customer wins, particularly in the pet food segment where we will start seeing benefits in the second half and continuing into future years as we build out additional production capabilities. Finally, our global rigid paper can business had a solid first quarter as low single-digit volume mixed growth in North America and South America was somewhat offset by store European and Southeast Asia volumes. With that brief introduction, I'm turning the call over to Jerry to review the numbers.

Thanks, Howard. I'm pleased to present the first quarter financial results, starting on page nine of the presentation. Please note that all results are on an adjusted basis and all growth metrics are on a year-over-year basis unless otherwise stated. The GAAP to non-GAAP EPS reconciliation is in the appendix of this presentation as well as in the press release. As Howard mentioned, on April 1st, 2025, we finalized the sale of our thermal formed and flexible packaging business, marking a significant milestone in advancing our fewer, bigger businesses strategy. strengthens our focus on core sustainable packaging platforms and positions us to reinvest in higher return opportunities that drive long-term earnings growth and margin expansion. Looking ahead, our leadership in two core markets will enable us to operate more efficiently and serve our customers with greater focus and agility. Adjusted EPS was $1.38. Earnings per share increased 23% year over year. mainly driven by continued strong productivity of $17 million and favorable price-cost performance across our core businesses. These gains were partially offset by unfavorable volume mix, other non-recurring items, and currency translation. First quarter net sales increased 31% to $1.7 billion, excluding discontinued operations of $321 million. This change was driven by favorable price and the impact of the full quarter of S&P EMEA's sales. Adjusted EBITDA of 338 million was up by an outstanding 38%, and adjusted EBITDA margin improved 170 basis points to 16.6%. This was driven by positive price costs, sustained favorable productivity, and the impact of acquisitions and partially offset by volume softness in the industrial segment and the impact of currency translation. Page 10 has our consumer segment results on continuing operations basis. Consumer sales were up 83% due to the S&P EMEA acquisition and favorable volume mix. Global rigid paper containers sales increased marginally compared to the prior year while our domestic packaging business, our domestic metal packaging business achieved double-digit growth, reflecting solid demand and continued commercial execution. Consumer adjusted EBITDA from continuing operations through a remarkable 127% year-over-year due to the impact of acquisitions, favorable price-cost dynamics, continued productivity gains, and positive volume mix. Page 11 has our industrial segment results. Industrial sales decreased 6% to $558 million. Results were impacted by lower volumes, the planned exit of our industrial operations in China, and unfavorable currency translation. These headwinds were partially offset by low single-digit improvements in selling prices driven by index-based price reset. Adjusted EBITDA margins expanded 200 basis points year-over-year in the first quarter, primarily driven by favorable price-cost dynamics and productivity gains. These benefits were partially offset by negative volume mix, as well as the impact of unfavorable currency translation and other items. Adjusted EBITDA increased by 6 million to 101 million, representing a 6% increase. Phase 12 has our results for the all other businesses. The all other sales were 85 million and adjusted EBITDA was 14 million. These sales and adjusted EBITDA results were affected by the divestiture of protective solutions combined with the ongoing softness in some key end markets. Turning to phase 13, we are reporting on our debt reduction progress. As of today, we have reduced our net leverage to just under four times net debt to adjusted EBITDA. We used approximately $1.5 billion in after-tax proceeds from the TFP sale to fully repay our $1.5 billion term loan. Our primary focus is to delever the business through strong organic cash flow and by using divestiture proceeds to reduce debt. We've established a clear and actionable roadmap to achieve this over the next 18 to 24 months. Our liquidity position remains strong, with approximately $915 million in available capacity, providing us with ample financial flexibility to support our operations, navigate market conditions, and invest in strategic initiatives as needed. Slide 14 provides a summary of the four-year guidance. We are reaffirming our four-year guidance. We expect to deliver adjusted EPS within the range of $6 and $6.20. This outlook reflects continued strength in our legacy businesses, the accretive impact of S&P EMEA acquisition, and the now completed divestiture of TFP, which is expected to be modestly diluted. We also anticipate some headwinds, including a higher effective tax rate and some softness on the industrial volume mix. This will be more than offset by the expected favorable price-cost outlook, actions to reduce fixed costs, strong volumes in the consumer segment, and the favorable impact of currency translations due to a weaker U.S. dollar. The previously announced price increases on our URB and converted products in North America were intended to defend our margins from continued inflation. The implementation is going well, and we anticipate seeing those benefits in our second half results. We expect another strong year of cash generation, with operating cash flow projected between 800 to 900 million and free cash flow between $450 to $550 million. And now I'll hand it over to Howard to walk us through our transformation journey.