Q3 2024 CCL Industries Inc Earnings Call Transcript
Key Points
- CCL Industries Inc (CCDBF) reported a 9.4% increase in sales for the third quarter of 2024, with 6.9% organic growth.
- Operating income increased by 13% compared to the same quarter in 2023, excluding the impact of foreign currency translation.
- The company achieved a 14.7% improvement in adjusted earnings per Class B share, reaching $1.09 compared to $0.95 in the third quarter of 2023.
- Free cash flow from operations was $233 million for the third quarter of 2024, up from $182 million in the same period in 2023.
- The Checkpoint segment experienced over 30% organic sales growth, driven by RFID wins and retailer inventory normalization.
- Corporate expenses increased slightly due to short-term variable compensation.
- Start-up costs in new operations, particularly in Spain, are expected to weigh on profitability in the CCL segment.
- The CCL Secure segment faced tough comparisons to a strong prior year, resulting in reduced profitability.
- The company's net debt increased by $167.6 million due to capital expenditures, business acquisitions, and share buybacks.
- North American organic growth slowed to low single digits in the third quarter, compared to high single digits in the second quarter.
Good morning, and welcome to CCL Industries' third quarter investor update. (Operator Instructions)
The moderator for today is Mr. Geoff Martin, President and Chief Executive Officer; and joining him is Mr. Sean Washchuk, Senior Vice President and Chief Financial Officer. Please go ahead, gentlemen.
Thank you, Holly. Good morning, everyone. Welcome to our third quarter call. We're here in Sioux Falls, South Dakota at our food and beverage facility. I'll draw everyone's attention to slide number 2, our disclaimer regarding forward-looking information. I will remind everyone that our business faces known and unknown risks and opportunities. For further details of these key risks, please take a look at our 2023 annual report under the section Risks and Uncertainties. Our annual and quarterly reports can be found online at the company's website cclind.com or at sedarplus.ca.
Moving to our summary of financial information. For the third quarter of 2024, sales
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