Business Context and Reporting Period
Company: GREIF, INC.
Filing Type: Form 10-Q (Unaudited)
Reporting Period: Quarter and nine months ended June 30, 2026
Business Overview: Greif is a global packaging solutions provider operating in four segments: Customized Polymer Solutions, Durable Metal Solutions, Sustainable Fiber Solutions, and Innovative Closure Solutions. The company recently completed the divestiture of its Containerboard Business (discontinued operations) and Soterra land management assets, and acquired Envaplast, S.L.
Key Financial Metrics
| Metric (in millions) | Q3 2026 | Q3 2025 | 9M 2026 | 9M 2025 |
|---|---|---|---|---|
| Net Sales | $1,165.6 | $1,125.9 | $3,233.2 | $3,221.0 |
| Gross Profit | $272.6 | $256.0 | $722.2 | $703.9 |
| Operating Profit | $107.9 | $63.7 | $399.9 | $158.5 |
| Net Income (Continuing Ops) | $82.6 | $36.9 | $281.8 | $73.3 |
| Net Income (Total) | $81.6 | $61.0 | $278.8 | $134.1 |
| Adjusted EBITDA | $183.4 | $147.1 | $462.7 | $391.8 |
| Cash from Operations (9M) | N/A | $170.0 | $286.1 | |
| Free Cash Flow (9M) | $51.5 | $193.2 | ||
| Total Debt (Long-term + Current) | N/A | $703.8 | $919.4 | |
| Cash & Equivalents | N/A | $288.5 | $292.0 |
Note: Free Cash Flow calculated as Operating Cash Flow less Capital Expenditures ($118.5M for 9M 2026, $92.9M for 9M 2025).
Material Changes vs. Prior Period
- Revenue Growth: Q3 2026 net sales increased 3.5% year-over-year, driven by higher average selling prices ($28.5M) and favorable foreign currency translation ($23.7M), partially offset by lower volumes.
- Profitability Surge: Operating profit for Q3 2026 rose 69% to $107.9M. The nine-month operating profit increased significantly to $399.9M, primarily due to a $216.2M gain from the Soterra Divestiture recorded in the first quarter.
- Discontinued Operations: The Containerboard Business was divested in August 2025. Results for this segment are now reported as discontinued operations, resulting in a net loss of $1.0M for Q3 2026 compared to net income of $24.1M in Q3 2025.
- Restructuring & Impairments: Restructuring charges decreased to $12.1M in Q3 2026 from $18.0M in Q3 2025. Non-cash asset impairment charges dropped significantly to $1.4M in Q3 2026 from $7.2M in the prior year.
- Debt Reduction: Total debt decreased from $919.4M (Sept 2025) to $703.8M (June 2026) following the refinancing of credit agreements and debt repayments funded by divestiture proceeds.
Guidance, Outlook, and Risks
- Management Commentary: Management notes a "subdued industrial demand environment" with marginal improvement. Geopolitical conflicts (e.g., Middle East) have caused supply chain disruptions and input cost inflation (raw materials, energy, transportation).
- Outlook: The company does not anticipate a significant inflection in overall demand patterns. It expects to offset inflationary pressures through strategic pricing and cost optimization.
- Capital Allocation: The company repurchased $150.1M of shares in the first nine months of 2026. A new authorization allows for up to $300M in repurchases (2025 Authorization), with an additional intent announced in July 2026 to repurchase up to $150M.
- Key Risks:
- Global economic sensitivity and industrial demand contraction.
- Geopolitical instability and currency exchange volatility.
- Raw material price fluctuations and supply chain disruptions.
- Environmental liabilities (e.g., Diamond Alkali Superfund Site reserve of $9.8M).
Investor Verification Checklist
- Soterra Gain Impact: Verify the sustainability of the $216.2M gain from the Soterra Divestiture, which heavily influenced 9M 2026 operating profit.
- Discontinued Operations: Confirm the exclusion of the Containerboard Business from future recurring revenue and earnings projections.
- Debt Covenants: Review compliance with the new 2026 Credit Agreements, specifically the leverage ratio (max 4.00x) and interest coverage ratio (min 3.00x).
- Acquisition Integration: Monitor the integration and performance of the Envaplast acquisition ($61.7M consideration) in the Customized Polymer Solutions segment.
- Working Capital Trends: Analyze the $83.3M increase in accounts receivable and $38.3M increase in inventories during the first nine months of 2026, which negatively impacted operating cash flow.