CCL Industries (CCL-B) Q3 2024 earnings summary

Executive summary

• Third quarter 2024 sales rose 9.4% year-over-year to $1,849.7 million, with 6.9% organic growth, 1.8% from acquisitions, and 0.7% from FX.

• Operating income increased 13% to $288.9 million; net earnings for Q3 were $191.7 million, up from $169.1 million, and nine-month net earnings were $663.3 million, including a $78.1 million non-taxable revaluation gain.

• Adjusted basic EPS for Q3 2024 was $1.09, up 14.7% from $0.95 in Q3 2023; nine-month adjusted EPS was $3.30, up from $2.79.

• Free cash flow from operations was $233 million in Q3 and $618.6 million for the trailing 12 months.

• All segments posted organic sales growth, with notable strength in Checkpoint (+14.5%) and Innovia (+18.0%).

Financial highlights

• EBITDA for Q3 was $380.7 million, up 11% year-over-year; nine-month EBITDA rose 14% to $1,135.5 million.

• Net debt increased to $1,675.8 million, mainly due to capex, acquisitions, and share buybacks; leverage ratio stood at 1.14x EBITDA.

• Gross profit for Q3 was $551.3 million, up from $489.1 million in Q3 2023.

• Free cash flow from operations for nine months was $344.8 million.

• Strong liquidity with $759.6 million cash and $0.9 billion undrawn credit facility.

Outlook and guidance

• Q4 faces higher hurdles due to tough comps and new plant startup costs, but October started better than expected.

• CCL Secure expected to improve sequentially; Avery stable; Checkpoint RFID and Innovia recovery to continue.

• CCL Design expected to slow as automotive industry softens.

• FX expected to be a modest tailwind at current rates.