Magnera Lifts EBITDA as Organic Volume Turns Positive
Fiscal third-quarter net sales rose 2% to $857 million.
Magnera (MAGN), the materials maker, increased adjusted EBITDA 9% to $99 million as organic volume returned to growth.
The 1% volume gain marked an inflection after five consecutive comparative declines, including a 2% drop in the preceding quarter and a 5% decline a year earlier. Comparable sales were flat, improving from the prior quarter’s 9% decline, while the selling-price headwind narrowed to $8 million from $57 million.
Net sales increased from $839 million a year earlier and rose 7.7% sequentially from $796 million. Adjusted EBITDA climbed 10% from the preceding quarter and reached its highest level in the five-quarter comparison, lifting the margin to about 11.6% from 10.8% a year earlier.
Operating income rose to $22 million from $13 million, helped by gross profit growth that expanded gross margin to about 13.1% from 10.7%. The quarterly net loss widened to $20 million, or $0.56 a share, from $18 million, or $0.51 a share, as restructuring and other costs increased and selling, general and administrative expenses rose.
The Americas drove the profit improvement, with adjusted EBITDA rising 16% to $71 million as Project CORE and merger synergies helped produce an $11 million favorable price-cost spread. Rest of World adjusted EBITDA fell 7% to $28 million as inflation, pass-through timing and higher overhead offset those benefits.
Regional pricing remained uneven. Americas selling prices decreased $13 million, an improvement from a $42 million decline in the preceding quarter, while Rest of World pricing increased $5 million as the company passed through higher raw-material costs.
Magnera reaffirmed its full-year free-cash-flow outlook and said adjusted EBITDA is expected at the lower end of its $380 million-to-$410 million range.
Nine-month operating cash flow increased to $76 million from $7 million a year earlier, yielding $32 million of free cash flow after capital spending. The company also reduced its operating footprint to 44 global facilities from 45 in the preceding quarter.