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What changed in Packaging Corporation of America's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Packaging Corporation of America's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+218 added−190 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-27)

Top changes in Packaging Corporation of America's 2025 10-K

218 paragraphs added · 190 removed · 169 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

61 edited+17 added−9 removed101 unchanged
Biggest changeOur most recent survey, conducted in 2024, saw a high level of participation assuring us that the results reflect the feelings and opinions of our employees. Our survey results reaffirmed our strong safety culture and our dedication to being socially and environmentally responsible. Our overall engagement index continues to rise and remains consistent with other U.S. manufacturing companies.
Biggest changeOur survey results reaffirmed our strong safety culture and our dedication to being socially and environmentally responsible. Our overall engagement index continues to rise and remains consistent with other U.S. manufacturing companies. We remain committed to seeking feedback from our employees as we work together to make meaningful improvements across our operations and make PCA a great place to work.
Prices for all of our products are driven by many factors, including demand for our products, industry capacity and decisions made by other producers with respect to capacity and production, inflation and other general cost increases, and other competitive conditions in our industry.
Prices for all of our products are driven by many factors, including demand for our products, industry capacity decisions made by other producers with respect to capacity and production, inflation and other general cost increases, and other competitive conditions in our industry.
These standards are aimed at ensuring the long-term health and conservation of forests. Our operations are committed to environmentally conscious, socially responsible, and economically sustainable fiber sourcing practices that prioritize stewardship of forest resources. 5 Energy supply. Energy at our packaging mills is obtained through self-generated or purchased fuels and electricity.
These standards are aimed at ensuring the long-term health and conservation of forests. Our operations are committed to environmentally conscious, socially responsible, and economically sustainable fiber sourcing practices that prioritize stewardship of forest resources. Energy supply. Energy at our packaging mills is obtained through self-generated or purchased fuels and electricity.
Further, if we cannot service our indebtedness, we may have to take actions to secure additional cash by selling assets, seeking additional equity or reducing investments, which may not be achievable on acceptable terms or at all. 14 Pension Plans – Our pension plans may require additional funding.
Further, if we cannot service our indebtedness, we may have to take actions to secure additional cash by selling assets, seeking additional equity or reducing investments, which may not be achievable on acceptable terms or at all. Pension Plans – Our pension plans may require additional funding.
A $0.10 per million MMBTU increase in natural gas prices would result in approximately $3 million of additional expense, based on 2024 usage. Customer Concentration – We rely on certain large customers. Our packaging and paper segments each have large customers, the loss of which could adversely affect the segment’s sales and profitability.
A $0.10 per million MMBTU increase in natural gas prices would result in approximately $3 million of additional expense, based on 2025 usage. Customer Concentration – We rely on certain large customers. Our packaging and paper segments each have large customers, the loss of which could adversely affect the segment’s sales and profitability.
During 2024, we experienced no work stoppages, and we believe we have satisfactory labor relations with our employees. 8 Regulatory and Environmenta l Matters A discussion of the financial impact of our compliance with environmental laws is presented under the caption “Regulatory and Environmental Matters” in “Part II, Item 7.
During 2025, we experienced no work stoppages, and we believe we have satisfactory labor relations with our employees. 8 Regulatory and Environmenta l Matters A discussion of the financial impact of our compliance with environmental laws is presented under the caption “Regulatory and Environmental Matters” in “Part II, Item 7.
The cost and availability of wood fiber can also be impacted by weather, general logging conditions, geography, and regulatory activity. The availability and cost of recycled fiber depends heavily on recycling rates and the domestic and global supply and demand for recycled products. We purchase recycled fiber for use at six of our containerboard mills.
The cost and availability of wood fiber can also be impacted by weather, general logging conditions, geography, and regulatory activity. The availability and cost of recycled fiber depends heavily on recycling rates and the domestic and global supply and demand for recycled products. We purchase recycled fiber for use at eight of our containerboard mills.
All of our mills can utilize virgin wood fiber and all of our mills, other than the Valdosta mill, can utilize some recycled fiber in their containerboard production. Our corrugated manufacturing operations generate recycled fiber as a by-product from the manufacturing process, which is consumed by our mills.
All of our mills, other than the Massillon mill and the Wallula mill, can utilize virgin wood fiber and all of our mills, other than the Valdosta mill, can utilize some recycled fiber in their containerboard production. Our corrugated manufacturing operations generate recycled fiber as a by-product from the manufacturing process, which is consumed by our mills.
Carter, 65, Executive Vice President - Mill Operations - Mr. Carter has led our mill operations since January 2011. From March 2010 to January 2011, Mr. Carter served as PCA’s Director of Papermaking Technology. Prior to joining PCA in 2010, Mr.
Carter, 66 , Executive Vice President - Mill Operations - Mr. Carter has led our mill operations since January 2011. From March 2010 to January 2011, Mr. Carter served as PCA’s Director of Papermaking Technology. Prior to joining PCA in 2010, Mr.
Although interest rates decreased during 2024, rates still remain relatively high, which may result in lower consumer demand and higher borrowing costs, and may cause general economic conditions to deteriorate. The economic outlook for 2025 remains uncertain. We operate substantially all of our business in the United States.
Although interest rates decreased during 2025, rates still remain relatively high, which may result in lower consumer demand and higher borrowing costs, and may cause general economic conditions to deteriorate. The economic outlook for 2026 remains uncertain. We operate all of our business in the United States.
The process steam is used throughout the production process and also to generate electricity. In 2024, our packaging mills consumed about 89 million MMBTUs of fuel to produce both steam and electricity.
The process steam is used throughout the production process and also to generate electricity. In 2025, our packaging mills consumed about 89 million MMBTUs of fuel to produce both steam and electricity.
If the agreement is not renewed by the parties, ODP's obligation to purchase paper would phase down over a two-year period beginning January 1, 2026.
If the agreement is not renewed by the parties, ODP's obligation to purchase paper would phase down over a two-year period beginning January 1, 2027.
In 2024, our sales revenue to ODP represented 58% of our Paper segment sales revenue and 4% of our consolidated sales revenue. 7 Competition The markets in which our Paper segment competes are large and highly competitive.
In 2025, our sales revenue to ODP represented 58% of our Paper segment sales revenue and 4% of our consolidated sales revenue. 7 Competition The markets in which our Paper segment competes are large and highly competitive.
We have established long-term relationships with many of our customers. ODP Corporation (“ODP”), formerly Office Depot, Inc., along with its subsidiaries and affiliates, is our largest customer in the Paper segment. Effective January 1, 2024, we have amended the agreement with ODP in which we will continue to supply commodity and non-commodity office papers through December 31, 2025.
We have established long-term relationships with many of our customers. ODP Corporation (“ODP”), formerly Office Depot, Inc., along with its subsidiaries and affiliates, is our largest customer in the Paper segment. Effective March 1, 2025, we have amended the agreement with ODP in which we will continue to supply commodity and non-commodity office papers through December 31, 2026.
Kowlzan is a member of the board of American Forest and Paper Association. Thomas A. Hassfurther, 69, President - Mr. Hassfurther was promoted to President of PCA in February 2025. Mr.
Kowlzan is a member of the board of American Forest and Paper Association. Thomas A. Hassfurther, 70 , President - Mr. Hassfurther was promoted to President of PCA in February 2025. Mr.
We ship to customers both directly from our mills and through distribution centers and a network of outside warehouses by rail or truck. This allows us to respond quickly to customer requirements. Customers We have about 50 customers in approximately 200 locations. These customers include office products distributors and retailers, paper merchants, and envelope and other converters.
We ship to customers both directly from our mill and through distribution centers and a network of outside warehouses by rail or truck. This allows us to respond quickly to customer requirements. Customers We have about 50 customers in approximately 180 locations. These customers include office products distributors and retailers, paper merchants, and envelope and other converters.
A $10 per ton price increase in recycled fiber for our containerboard mills would result in approximately $10 million of additional expense based on 2024 consumption. 11 Cost of Purchased Fuels and Chemicals – An increase in the cost of purchased fuels and chemicals could lead to higher manufacturing costs, resulting in reduced earnings.
A $10 per ton price increase in recycled fiber for our containerboard mills would result in approximately $20 million of additional expense based on 2026 estimated consumption. 11 Cost of Purchased Fuels and Chemicals – An increase in the cost of purchased fuels and chemicals could lead to higher manufacturing costs, resulting in reduced earnings.
Carter spent 28 years with various pulp and paper companies in managerial and technical positions of increasing responsibility, most recently as Vice President and General Manager of the Calhoun, Tennessee mill of Abitibi Bowater from 2007 to 2010 and as manager of SP Newsprint’s Dublin, Georgia mill from 1999 to 2007. Robert P.
Carter spent 28 years with various pulp and paper companies in managerial and technical positions of increasing responsibility, most recently as Vice President and General Manager of the Calhoun, Tennessee mill of Abitibi Bowater from 2007 to 2010 and as manager of SP Newsprint’s Dublin, Georgia mill from 1999 to 2007. Kent A.
ODP Corporation (“ODP”), formerly Office Depot, Inc., along with its subsidiaries and affiliates, is our largest customer in the Paper segment. Effective January 1, 2024, we have amended the agreement with ODP in which we will continue to supply commodity and non-commodity office papers through December 31, 2025.
ODP Corporation (“ODP”), formerly Office Depot, Inc., along with its subsidiaries and affiliates, is our largest customer in the Paper segment. Effective March 1, 2025, we have amended the agreement with ODP in which we will continue to supply commodity and non-commodity office papers through December 31, 2026.
We have, at times, experienced significant cost inflation and volatility for key inputs such as fuels and chemicals. We have the ability to use various types of purchased fuels in our manufacturing operations, including natural gas, bark, and other purchased fuels. Fuel prices, in particular prices for oil and natural gas, have fluctuated in the past.
We have, at times, experienced significant cost inflation and volatility for key inputs such as fuels and chemicals. We have the ability to use various types of purchased fuels in our manufacturing operations, including natural gas, and wood waste. Fuel prices, in particular prices for oil and natural gas, have fluctuated in the past.
According to industry sources, corrugated products are produced by about 380 U.S. companies operating approximately 1,100 plants. The primary basis for competition for most of our packaging products includes quality, service, price, product design, and innovation. Most corrugated products are manufactured to the customer’s specifications.
According to industry sources, corrugated products are produced by about 370 U.S. companies operating approximately 1,080 plants. The primary basis for competition for most of our packaging products includes quality, service, price, product design, and innovation. Most corrugated products are manufactured to the customer’s specifications.
In 2024, our paper mill consumed about 12 million MMBTUs of fuel to produce both steam and electricity. Of the 12 million MMBTUs consumed, about 74% was from mill-generated biogenic fuels that are by-products of the manufacturing and pulping process and 26% was from purchased natural gas. Chemical supply.
In 2025, our paper mill consumed about 11 million MMBTUs of fuel to produce both steam and electricity. Of the 11 million MMBTUs consumed, about 74% was from mill-generated biogenic fuels that are by-products of the manufacturing and pulping process and 26% was from purchased natural gas. Chemical supply.
If the agreement is not renewed by the parties, ODP’s obligation to purchase paper would phase down over a two-year period beginning January 1, 2026. In 2024, sales to ODP represented 58% of our Paper segment sales and 4% of our consolidated sales.
If the agreement is not renewed by the parties, ODP’s obligation to purchase paper would phase down over a two-year period beginning January 1, 2027. In 2025, sales to ODP represented 58% of our Paper segment sales and 4% of our consolidated sales.
The primary end-use markets in the United States for corrugated products are shown below as reported in the 2023 Fibre Box Association annual report: Food, beverages, and agricultural products 43 % Retail and wholesale trade 29 % Chemical, plastic, and rubber products 11 % Paper and other products 9 % Miscellaneous manufacturing 8 % Competition As of December 31, 2024, we were the third largest producer of containerboard products in North America, according to industry sources and our own estimates.
The primary end-use markets in the United States for corrugated products are shown below as reported in the 2024 Fibre Box Association annual report: Food, beverages, and agricultural products 40 % Retail and wholesale trade 29 % Chemical, plastic, and rubber products 11 % Paper and other products 10 % Miscellaneous manufacturing 10 % Competition As of December 31, 2025, we were the third largest producer of containerboard products in North America, according to industry sources and our own estimates.
In 2024, we purchased approximately 1,040,000 tons of recycled fiber at our containerboard mills, net of the recycled fiber generated by our corrugated box plants. The amount of recycled fiber purchased each year varies based upon production and the prices of both recycled fiber and wood fiber.
In 2025, we purchased approximately 1,150,000 tons of recycled fiber at our containerboard mills, net of the recycled fiber generated by our corrugated box plants. The amount of recycled fiber purchased each year varies based upon production and the prices of both recycled fiber and wood fiber.
Executive Officers of the Registrant Brief statements setting forth the age at February 27, 2025, the principal occupation, employment during the past five years, the year in which such person first became an officer of PCA, and other information concerning each of our executive officers appears below. Mark W. Kowlzan, 69, Chairman and Chief Executive Officer - Mr.
Executive Officers of the Registrant Brief statements setting forth the age at February 26, 2026, the principal occupation, employment during the past five years, the year in which such person first became an officer of PCA, and other information concerning each of our executive officers appears below. Mark W. Kowlzan, 70 , Chairman and Chief Executive Officer - Mr.
Customers We sell containerboard and corrugated products to approximately 13,000 customers in approximately 29,000 locations. About 70% of our corrugated products sales are to regional and local accounts, which are broadly diversified across industries and geographic locations.
Customers We sell containerboard and corrugated products to approximately 12,000 customers in approximately 27,000 locations. About 70% of our corrugated products sales are to regional and local accounts, which are broadly diversified across industries and geographic locations.
Our current borrowings, plus any future borrowings, may affect our ability to operate our business, including, without limitation: • Result in significant cash requirements to make interest and maturity payments on our outstanding indebtedness; • Increase our vulnerability to adverse changes in our business or industry conditions; • Increase our vulnerability to increases in interest rates; • Limit our ability to obtain additional financing for working capital, capital expenditures, general corporate, and other purposes; • Limit our flexibility in planning for, or reacting to, changes in our business and our industry; and • Limit our flexibility to make acquisitions.
We and our subsidiaries are not restricted from incurring, and may incur, additional indebtedness in the future. 14 Our current borrowings, plus any future borrowings, may affect our ability to operate our business, including, without limitation: • Result in significant cash requirements to make interest and maturity payments on our outstanding indebtedness; • Increase our vulnerability to adverse changes in our business or industry conditions; • Increase our vulnerability to increases in interest rates; • Limit our ability to obtain additional financing for working capital, capital expenditures, general corporate, and other purposes; • Limit our flexibility in planning for, or reacting to, changes in our business and our industry; and • Limit our flexibility to make acquisitions.
Total annual containerboard capacity was approximately 301 BSF as of December 31, 2024. The following provides more details of our containerboard mills: Counce. Our Counce, Tennessee mill produces kraft linerboard on two machines. The mill can produce basis weights from 26 lb. to 90 lb. DeRidder.
Total annual containerboard capacity was approximately 5.8 million tons (358 BSF) as of December 31, 2025. The following provides more details of our containerboard mills: Counce. Our Counce, Tennessee mill produces kraft linerboard on two machines. The mill can produce basis weights from 26 lb. to 90 lb. DeRidder.
As of December 31, 2024, we produced corrugated and protective packaging products at 86 facilities, and operated a technical and development center, seven regional design centers, a rotogravure printing operation, and a complement of packaging supplies and distribution centers.
As of December 31, 2025, we produced corrugated and protective packaging products at 91 facilities, and operated a technical and development center, six regional design centers, a rotogravure printing operation, and a complement of packaging supplies and distribution centers.
In 2024, our total company costs including cost of sales (COS) and selling, general, and administrative expenses (SG&A) was $7.2 billion, and excluding non-cash costs (depreciation, depletion and amortization, pension and postretirement expense, and share-based compensation expense) was $6.6 billion. A 1% increase in COS and SG&A costs would increase costs by $72 million and cash costs by $66 million.
In 2025, our total company costs including cost of sales (COS) and selling, general, and administrative expenses (SG&A) was $7.7 billion, and excluding non-cash costs (depreciation, depletion and amortization, pension and postretirement expense, and share-based compensation expense) was $7.0 billion. A 1% increase in COS and SG&A costs would increase costs by $77 million and cash costs by $70 million.
Of the 89 million MMBTUs consumed, about 63% was from mill-generated biogenic fuels that are by-products of our containerboard manufacturing and pulping process and 37% was from purchased fuels. Of the purchased fuels, 76% was from natural gas, 22% was from purchased wood waste and 2% was from other purchased fuels. Chemical supply.
Of the 89 million MMBTUs consumed, about 62% was from mill-generated biogenic fuels that are by-products of our containerboard manufacturing and pulping process and 38% was from purchased fuels. Of the purchased fuels, 76% was from natural gas, 23% was from purchased wood waste and 1% was from other purchased fuels. Chemical supply.
During the year ended December 31, 2024, our Packaging segment produced 294 billion square feet (BSF) of containerboard at our mills. Our corrugated products manufacturing plants sold 67 BSF of corrugated products. 4 Facilities We manufacture containerboard, which includes a variety of performance and specialty grades, at our containerboard mills.
During the year ended December 31, 2025, our Packaging segment produced 5.2 million tons (305 billion square feet (BSF)) of containerboard at our mills. Our corrugated products manufacturing plants sold 71 BSF of corrugated products. 4 Facilities We manufacture containerboard, which includes a variety of performance and specialty grades, at our containerboard mills.
Item 1. B USINESS Packaging Corporation of America (“we,” “us,” “our,” “PCA,” or the “Company”) is the third largest producer of containerboard products and a leading producer of uncoated freesheet (UFS) paper in North America. We operate eight mills and 86 corrugated products plants and related facilities.
Item 1. B USINESS Packaging Corporation of America (“we,” “us,” “our,” “PCA,” or the “Company”) is the third largest producer of containerboard products and a leading producer of uncoated freesheet (UFS) paper in North America. We operate ten mills and 91 corrugated products plants and related facilities. We are headquartered in Lake Forest, Illinois and operate in the United States.
These factors may result in lower demand for our products and negatively affect our business, results of operations and cash flows. 10 In addition, changes in U.S. trade policy, including renegotiating or potentially terminating existing bilateral or multilateral agreements as well as the imposition of tariffs or retaliatory tariffs from other nations, could impact global markets and demand for our and our customers’ products and the costs associated with certain of our capital investments.
In addition, changes in U.S. trade policy, including renegotiating or potentially terminating existing bilateral or multilateral agreements as well as the imposition of tariffs or retaliatory tariffs from other nations, could impact global markets and demand for our and our customers’ products and the costs associated with certain of our capital investments.
As demand for qualified personnel is increasing, we are expanding our efforts in these critical areas along with efforts to continue to develop, promote and maintain a workforce with a culture and an environment of engaged management and mutual respect. We publicly disclose in our annual responsibility report our employee demographics in the form of our annual EEO-1 report.
As demand for qualified personnel is increasing, we are expanding our efforts in these critical areas along with efforts to continue to develop, promote and maintain a workforce with a culture and an environment of engaged management and mutual respect.
Of the 86 manufacturing facilities, 58 are combining operations, commonly called corrugated plants, which manufacture corrugated sheets and finished corrugated packaging products, 27 are sheet plants, which procure combined sheets and manufacture finished corrugated packaging products, and one is a corrugated sheet-only manufacturer. Corrugated products plants tend to be located in close proximity to customers to minimize freight costs.
Of the 91 manufacturing facilities, 56 are combining operations, commonly called corrugated plants, which manufacture corrugated sheets and finished corrugated packaging products, 28 are sheet plants, which procure combined sheets and manufacture finished corrugated packaging products, and seven are corrugated sheet-only manufacturers. Corrugated products plants tend to be located in close proximity to customers to minimize freight costs.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Containerboard Production (billion square feet) 2024 67.3 73.7 76.0 76.8 293.8 2023 64.1 65.3 65.8 70.2 265.4 2022 70.9 71.8 64.9 55.8 263.4 Corrugated Products Shipments (billion square feet) 2024 16.1 16.5 17.2 17.1 66.9 2023 14.7 14.9 15.2 15.7 60.5 2022 16.8 16.5 15.4 14.7 63.4 UFS Production (thousand tons) 2024 124 120 127 128 499 2023 126 116 109 121 472 2022 126 127 123 130 506 3 Below is a map of our locations: Packa ging Packaging Products Our containerboard mills produce linerboard and corrugating medium, which are papers primarily used in the production of corrugated products.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Containerboard Production (billion square feet) 2025 72.5 69.2 77.4 85.8 304.9 2024 67.3 73.7 76.0 76.8 293.8 2023 64.1 65.3 65.8 70.2 265.4 Containerboard Production (thousand tons) 2025 1,250 1,195 1,302 1,407 5,154 2024 1,162 1,281 1,293 1,310 5,046 2023 1,086 1,112 1,118 1,213 4,529 Corrugated Products Shipments (billion square feet) 2025 16.4 16.5 18.1 20.1 71.1 2024 16.1 16.5 17.2 17.1 66.9 2023 14.7 14.9 15.2 15.7 60.5 UFS Production (thousand tons) 2025 124 115 124 121 484 2024 124 120 127 128 499 2023 126 116 109 121 472 3 Below is a map of our locations: Packa ging Packaging Products Our containerboard mills produce linerboard and corrugating medium, which are papers primarily used in the production of corrugated products.
Industry Cyclicality – Changes in the prices of our products could materially affect our financial condition, results of operations, and liquidity. Macroeconomic conditions and fluctuations in industry capacity can create changes in prices, sales volumes, and margins for most of our products, particularly commodity grades of packaging and paper products.
Macroeconomic conditions and fluctuations in industry capacity can create changes in prices, sales volumes, and margins for most of our products, particularly commodity grades of packaging and paper products.
In January 2022, she was promoted to Senior Vice President—Tax, ESG and Government Affairs, and leads our sustainability reporting and government affairs functions. Before joining PCA, Ms. Olivier worked for Coopers & Lybrand LLP, Alberto-Culver Company and SPX Corporation. Heidi L. Patton, 56 , Senior Vice President – Containerboard Sales and Supply Chain - Ms.
Olivier has led our tax department since 1994 and served as Vice President—Tax from October 2010 to January 2022. In January 2022, she was promoted to Senior Vice President—Tax, ESG and Government Affairs, and leads our sustainability reporting and government affairs functions. Before joining PCA, Ms. Olivier worked for Coopers & Lybrand LLP, Alberto-Culver Company and SPX Corporation. Heidi L.
Patton has served as Senior Vice President – Containerboard Sales and Supply Chain since January 2025. She previously served as Vice President – Containerboard Sales since 2014 and as General Manager, Containerboard Sales and Trade Manager since she joined PCA in 1996. Kent A. Pflederer, 54, Senior Vice President, General Counsel and Secretary - Mr.
Patton, 57 , Senior Vice President – Containerboard Sales and Supply Chain - Ms. Patton has served as Senior Vice President – Containerboard Sales and Supply Chain since January 2025. She previously served as Vice President – Containerboard Sales since 2014 and as General Manager, Containerboard Sales and Trade Manager since she joined PCA in 1996. Joseph W.
Periods of higher recycled fiber costs and unusual price volatility have occurred in the past, including during 2024. Prices for recycled fiber may continue to fluctuate significantly in the future, and a significant increase could result in higher costs and lower earnings.
Prices for recycled fiber may continue to fluctuate significantly in the future, and a significant increase could result in higher costs and lower earnings.
As part of our renewable virgin fiber sourcing efforts, we participate in the Sustainable Forestry Initiative® (SFI), the Programme for the Endorsement of Forest Certification (PEFC), as well as the Forest Stewardship Council® (FSC®) voluntary certification programs, and are certified under their chain of custody and fiber sourcing standards.
We procure wood fiber through leases of cutting rights, long-term supply agreements, and market purchases and believe we have adequate sources of fiber supply for the foreseeable future. 5 As part of our renewable virgin fiber sourcing efforts, we participate in the Sustainable Forestry Initiative® (SFI), the Programme for the Endorsement of Forest Certification (PEFC), as well as the Forest Stewardship Council® (FSC®) voluntary certification programs, and are certified under their chain of custody and fiber sourcing standards.
Further changes in tax laws or tax rates may have a material impact on our future cash taxes, effective tax rate or deferred tax assets and liabilities. These conditions are beyond our control and may have a material impact on our business, results of operations, liquidity, and financial position.
Further changes in tax laws or tax rates may have a material impact on our future cash taxes, effective tax rate or deferred tax assets and liabilities.
Vaughn has served as our Senior Vice President – Engineering and Operations Support since 2024. Mr. Vaughn previously served as Vice President – Engineering and Project Management. Prior to joining PCA in 2017, he spent 30 years with various pulp and paper companies in managerial and engineering positions of increasing responsibility. Available Information PCA’s internet website address is www.packagingcorp.com .
Prior to joining PCA in 2017, he spent 30 years with various pulp and paper companies in managerial and engineering positions of increasing responsibility. 9 Available Information PCA’s internet website address is www.packagingcorp.com .
Corrugated producers generally sell within a 150-mile radius of their plants and compete with other corrugated producers in their local region. Competition in our corrugated products operations tends to be regional, although we also face competition from competitors with significant national account presence. On a national level, our primary competitors are International Paper, Smurfit WestRock, and Georgia-Pacific LLC.
Competition in our corrugated products operations tends to be regional, although we also face competition from competitors with significant national account presence. 6 On a national level, our primary competitors are International Paper, Smurfit WestRock, Georgia-Pacific LLC, and Pratt Industries. However, with our strategic focus on regional and local accounts, we also compete with many smaller, independent producers.
We are headquartered in Lake Forest, Illinois and operate primarily in the United States. We report in three reportable segments: Packaging, Paper and Corporate and Other. For segment financial information see Note 18, Segment Information, of the Notes to Consolidated Financial Statements in “Part II, Item 8, Financial Statements and Supplementary Data” of this Form 10-K.
We report in three reportable segments: Packaging, Paper and Corporate and Other. For segment financial information see Note 19, Segment Information, of the Notes to Consolidated Financial Statements in “Part II, Item 8, Financial Statements and Supplementary Data” of this Form 10-K. On September 2, 2025, we completed the acquisition of the containerboard business of Greif, Inc.
Pflederer served as Senior Counsel, Corporate and Securities, at Hospira, Inc. from 2004 to 2007 and served in the corporate and securities practice at Mayer Brown, LLP from 1996 to 2004. 9 Joseph W. Vaughn, 62 , Senior Vice President – Engineering and Operations Support - Mr.
Pflederer served as Senior Counsel, Corporate and Securities, at Hospira, Inc. from 2004 to 2007 and served in the corporate and securities practice at Mayer Brown, LLP from 1996 to 2004. D. Ray Shirley, 54, Executive Vice President – Corrugated Products - Mr. Shirley was promoted to Executive Vice President – Corrugated Products in February 2025.
Investors, customers, governmental authorities, and other stakeholders have an interest in ESG matters, including with respect to climate change, greenhouse gas emissions, and sustainable business practices.
Investors, customers, governmental authorities, and other stakeholders have an interest in ESG matters, including with respect to climate change, greenhouse gas emissions, and sustainable business practices. The expectations of these stakeholders continues to evolve and there can be no guarantee that our approach will align with the preferences of any particular stakeholder.
Debt obligations – Our debt service obligations may reduce our operating flexibility. At December 31, 2024, we had $2.5 billion of debt outstanding and a $323 million undrawn revolving credit facility, after deducting letters of credit. All debt is comprised of fixed-rate senior notes.
Debt obligations – Our debt service obligations may reduce our operating flexibility. At December 31, 2025, we had $4.0 billion of debt outstanding and a $573 million undrawn revolving credit facility, after deducting letters of credit. Our indebtedness includes $1.0 billion with floating interest rates.
Our Wallula, Washington mill produces corrugating medium on its No. 2 machine and kraft linerboard and corrugating medium on its No. 3 machine. The mill can produce medium in basis weights from 23 lb. to 33 lb. and linerboard in basis weights from 31 lb. to 52 lb.
We acquired the Riverville, Virginia mill with the Greif acquisition. The mill produces corrugating medium on its No. 1 machine and corrugating medium and kraft linerboard and on its No. 2 machine. The mill can produce medium in basis weights from 23 lb. to 40 lb. and linerboard in basis weights from 26 lb. to 42 lb. Tomahawk.
We manufacture and sell papers, including both commodity and specialty papers, which may have custom or specialized features such as colors, coatings, high brightness, and recycled content. Our papers consist of communication papers, including cut-size office papers, and printing and converting papers.
Pap er We are a leading producer of UFS in North America, according to industry sources and our own estimates. We manufacture and sell papers, including both commodity and specialty papers, which may have custom or specialized features such as colors, coatings, high brightness, and recycled content.
If global or domestic economic conditions deteriorate, economies could experience a recession, which may result in higher unemployment rates, lower disposable income, lower Company earnings and investment, and lower consumer spending.
If economic conditions deteriorate, the U.S. economy could experience a recession, which may result in higher unemployment rates, lower disposable income, lower Company earnings and investment, and lower consumer spending. These factors may result in lower demand for our products and negatively affect our business, results of operations and cash flows.
The mill has the capacity to produce approximately 500,000 tons annually. Major Raw Materials Used Fiber supply. Fiber is the largest raw material cost in this segment. We consume wood fiber, recycled fiber, and purchased pulp. We purchase wood fiber through contracts and open-market purchase, and we purchase recycled fiber and pulp from third parties pursuant to contractual agreements.
Facilities We currently have one paper mill located in International Falls, Minnesota that produces both commodity and specialty papers on two paper machines. The mill has the capacity to produce approximately 500,000 tons annually. Major Raw Materials Used Fiber supply. Fiber is the largest raw material cost in this segment. We consume wood fiber, recycled fiber, and purchased pulp.
Pflederer has served as Senior Vice President, General Counsel and Corporate Secretary since January 2013 and has led our legal department since June 2007. Prior to joining PCA, Mr.
Pflederer, 55, Executive Vice President and Chief Financial Officer - Mr. Pflederer has served as our Chief Financial Officer since 2025. He previously served as General Counsel and Corporate Secretary from May 2007 to April 2025. Prior to joining PCA, Mr.
Shirley previously served as PCA’s Vice President – Containerboard Mills Engineering and Process Technology from 2012 to 2019 and as Mill Manager at PCA’s Counce, Tennessee containerboard mill from 2010 to 2012. He has served in various management roles within the company, including the Operations Manager at the Filer City, Michigan containerboard mill. Before joining PCA in 1996, Mr.
From May 2019 to February 2025, Mr. Shirley served as PCA’s Senior Vice President – Corporate Engineering and Process Technology. Mr. Shirley previously served as PCA’s Vice President – Containerboard Mills Engineering and Process Technology from 2012 to 2019 and as Mill Manager at PCA’s Counce, Tennessee containerboard mill from 2010 to 2012.
Our products are sustainable and are produced from renewable raw materials, predominately using energy derived from biogenic fuels in our production processes and are recyclable at end-of-life. Facilities We currently have one paper mill located in International Falls, Minnesota that produces both commodity and specialty papers on two paper machines.
Our papers consist of communication papers, including cut-size office papers, and printing and converting papers. Our products are sustainable and are produced from renewable raw materials, predominately using energy derived from biogenic fuels in our production processes and are recyclable at end-of-life.
As of December 31, 2024, we had approximately 15,400 employees, including 4,300 salaried and 11,100 hourly employees. Approximately 60% of our hourly employees worked pursuant to collective bargaining agreements.
Our next employee engagement survey will be conducted as scheduled in the first half of 2026. As of December 31, 2025, we had approximately 16,800 employees, including 4,600 salaried and 12,200 hourly employees. Approximately 57% of our hourly employees worked pursuant to collective bargaining agreements.
Our responsibility report is available on our website and is not intended to be incorporated by reference herein. PCA regularly conducts employee engagement surveys to measure overall satisfaction and gain a deeper understanding of how to improve our employees’ work experience.
PCA regularly conducts employee engagement surveys to measure overall satisfaction and gain a deeper understanding of how to improve our employees’ work experience. Our most recent survey, conducted in 2024, saw a high level of participation assuring us that the results reflect the feelings and opinions of our employees.
The mill can produce linerboard in basis weights from 22 lb. to 34 lb. and medium in basis weights from 23 lb. to 33 lb. We converted the mill from production of UFS to production of containerboard in 2021 and completed work to optimize the mill for containerboard production in 2024. Tomahawk.
The mill can produce linerboard in basis weights from 22 lb. to 34 lb. and medium in basis weights from 23 lb. to 33 lb. Massillon. We acquired the Massillon, Ohio mill with the Greif acquisition. The mill produces recycled corrugating medium on two machines. The mill can produce basis weights from 20 lb. to 40 lb. Riverville.
Shirley worked for Georgia-Pacific Corporation. Darla J. Olivier, 55, Senior Vice President – Tax, ESG and Government Affairs - Ms. Olivier has led our tax department since 1994 and served as Vice President—Tax from October 2010 to January 2022.
He has served in various management roles within the company, including the Operations Manager at the Filer City, Michigan containerboard mill. Before joining PCA in 1996, Mr. Shirley worked for Georgia-Pacific Corporation. Darla J. Olivier, 56, Senior Vice President – Tax, ESG and Government Affairs - Ms.
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In 2024, our usage of recycled fiber, net of internal generation, represents 21% of our containerboard production. We procure wood fiber through leases of cutting rights, long-term supply agreements, and market purchases and believe we have adequate sources of fiber supply for the foreseeable future.
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(“Greif” or “Greif Acquisition”) for $1.8 billion in cash. The Greif containerboard business includes two containerboard mills with approximately 800,000 tons of production capacity and eight sheet feeder and corrugated plants located across the United States. The operating results of Greif Acquisition are included in PCA’s results in the Packaging segment after the date of acquisition.
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However, with our strategic focus on regional and local accounts, we also compete with many smaller, independent producers. 6 Pap er We are a leading producer of UFS in North America, according to industry sources and our own estimates.
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Our Wallula, Washington mill produces kraft linerboard and corrugating medium on its No. 3 machine. The mill can produce basis weights from 23 lb. to 26 lb. During the fourth quarter of 2025, the Company announced that it will permanently shut down the No. 2 paper machine and kraft pulping facilities at the Wallula mill.
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We remain committed to seeking feedback from our employees as we work together to make meaningful improvements across our operations and make PCA a great place to work. Our next employee engagement survey will be conducted as scheduled in the first half of 2026.
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These activities were completed during the first quarter of 2026. The Company continues to operate the No. 3 paper machine and recycled pulping facilities at the mill.
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Mundy, 63, Executive Vice President and Chief Financial Officer - Mr. Mundy has served as our Chief Financial Officer since 2015. He previously served as Senior Vice President and Chief Financial Officer of Verso Corporation, a leading North American supplier of coated papers to catalog and magazine publishers, from 2006 to June 2015.
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In 2025, our usage of recycled fiber, net of internal generation, represents 22% of our containerboard production, which is expected to increase in 2026 and future periods.
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Verso Corporation filed for Chapter 11 bankruptcy in January 2016.
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Corrugated producers generally sell within a 150-mile radius of their plants and compete with other corrugated producers in their local region.
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Prior to that, he worked at International Paper from 1983 to 2006, where he was Director of Finance of the Coated and Supercalendered Papers division from 2002 to 2006, Director of Finance Projects from 2001 to 2002, Controller of Masonite Corporation from 1999 to 2001, and Controller of the Petroleum and Minerals business from 1996 to 1999.
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We purchase wood fiber through contracts and open-market purchase, and we purchase recycled fiber and pulp from third parties pursuant to contractual agreements.
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He served in various business positions at International Paper from 1983 to 1996. D. Ray Shirley, 53, Executive Vice President – Corrugated Products - Mr. Shirley was promoted to Executive Vice President – Corrugated Products in February 2025. From May 2019 to February 2025, Mr. Shirley served as PCA’s Senior Vice President – Corporate Engineering and Process Technology. Mr.
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Vaughn, 63 , Senior Vice President – Engineering and Operations Support - Mr. Vaughn has served as our Senior Vice President – Engineering and Operations Support since 2024. Mr. Vaughn previously served as Vice President – Engineering and Project Management.
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As a result, we anticipate a continued interest in reporting on ESG metrics, more prescriptive reporting requirements with respect to ESG metrics, and expectations that companies establish goals and commitments regarding ESG metrics and take actions to achieve those goals and commitments.
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These conditions are beyond our control and may have a material impact on our business, results of operations, liquidity, and financial position. 10 Industry Cyclicality – Changes in the prices of our products could materially affect our financial condition, results of operations, and liquidity.
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We and our subsidiaries are not restricted from incurring, and may incur, additional indebtedness in the future.
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Due to the Greif Acquisition and the restructuring of the Wallula mill, recycled fiber will be a higher proportion of our fiber mix in the future. Periods of higher recycled fiber costs and unusual price volatility have occurred in the past.
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Both mandatory and voluntary ESG reporting requirements are also evolving and may not be uniform nor evenly interpreted, ESG information is often reliant on third-party information and ESG scoring service providers use differing methodologies which may impact how stakeholders perceive, justifiably or not, how we are performing.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWhile we have experienced threats to our data and systems, as of December 31, 2024, we are not aware of any cybersecurity incidents that have materially impacted, or are reasonably likely to materially impact, our operations or financial condition. Board Roles and Responsibilities The Audit Committee of the Board of Directors oversees the Company’s cyber risk management program .
Biggest changeWhile we have experienced threats to our data and systems, as of December 31, 2025, we are not aware of any cybersecurity incidents that have materially impacted, or are reasonably likely to materially impact, our operations or financial condition. 15 Board Roles and Responsibilities The Audit Committee of the Board of Directors oversees the Company’s cyber risk management program .
We believe these measures together with our cyber risk management program as well as our policies, processes and procedures set a high benchmark for our employees to address and respond to cybersecurity threats. 15 Our IT team regularly monitors best practices and as needed, implements changes to the Company’s cyber risk management program to ensure a robust program is maintained.
We believe these measures together with our cyber risk management program as well as our policies, processes and procedures set a high benchmark for our employees to address and respond to cybersecurity threats. Our IT team regularly monitors best practices and as needed, implements changes to the Company’s cyber risk management program to ensure a robust program is maintained.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe lease space for regional design centers and numerous other distribution centers, warehouses, and facilities. The equipment in these leased facilities is, in virtually all cases, owned by us, except for forklifts and other rolling stock, which are generally leased. We own our corporate headquarters building, which is located in Lake Forest, Illinois.
Biggest changeWe own warehouses and miscellaneous other properties, including sales offices and woodlands management offices. We lease space for regional design centers and numerous other distribution centers, warehouses, and facilities. The equipment in these leased facilities is, in virtually all cases, owned by us, except for forklifts and other rolling stock, which are generally leased.
Our properties have been generally well maintained and are in good operating condition. In general, our facilities have sufficient capacity and are adequate for our production and distribution requirements. As of December 31, 2024, we own buildings and land for our eight mills.
Our properties have been generally well maintained and are in good operating condition. In general, our facilities have sufficient capacity and are adequate for our production and distribution requirements. As of December 31, 2025, we own buildings and land for our ten mills.
Additionally, we have 86 corrugated manufacturing operations, of which the buildings and land for 53 are owned, including 45 combining operations, or corrugated plants, one corrugated sheet-only manufacturer, and seven sheet plants. We lease the buildings for 13 corrugated plants and 20 sheet plants. We own warehouses and miscellaneous other properties, including sales offices and woodlands management offices.
Additionally, we have 91 corrugated manufacturing operations, of which the buildings and land for 56 are owned, including 44 combining operations, or corrugated plants, five corrugated sheet-only manufacturers, and seven sheet plants. We lease the buildings for 12 corrugated plants, two corrugated sheet-only manufacturers, and 21 sheet plants.
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We own our corporate headquarters building, which is located in Lake Forest, Illinois.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. LEG AL PROCEEDINGS Information concerning legal proceedings can be found in Note 19, Commitments, Guarantees, Indemnifications, and Legal Proceedings, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K. Item 4. MINE SAFETY DISCLOSURE Not applicable. 16 PAR T II
Biggest changeItem 3. LEG AL PROCEEDINGS Information concerning legal proceedings can be found in Note 20, Commitments, Guarantees, Indemnifications, and Legal Proceedings, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K. Item 4. MINE SAFETY DISCLOSURE Not applicable. 16 PAR T II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table presents information related to our repurchases of common stock made under repurchase plans authorized by PCA’s Board of Directors, and shares withheld to cover taxes on vesting of equity awards, during the three months ended December 31, 2024: Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (a) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions) October 1-31, 2024 2,119 $ 212.90 — $ 436.0 November 1-30, 2024 — — — 436.0 December 1-31, 2024 2,146 224.62 — 436.0 Total 4,265 $ 218.79 — $ 436.0 (a) All shares were withheld from employees to cover income and payroll taxes on equity awards that vested during the period. 17 Performance Graph The graph below compares PCA’s cumulative 5-year total shareholder return on common stock with the cumulative total returns of the S&P 500 index and the S&P Midcap 400 index.
Biggest changeThe following table presents information related to our repurchases of common stock made under repurchase plans authorized by PCA’s Board of Directors, and shares withheld to cover taxes on vesting of equity awards, during the three months ended December 31, 2025: Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (a) Average Price Paid Per Share (b) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions) October 1-31, 2025 — $ — — $ 436.0 November 1-30, 2025 195 201.22 — 436.0 December 1-31, 2025 761,674 201.04 760,748 283.1 Total 761,869 $ 201.04 760,748 $ 283.1 (a) Includes 1,121 shares withheld from employees to cover income and payroll taxes on equity awards that vested during the period.
The graph tracks the performance of a $100 investment (including the reinvestment of all dividends) in our common stock and in each index from December 31, 2019 through December 31, 2024. The stock price performance included in this graph is not necessarily indicative of future stock price performance.
The graph tracks the performance of a $100 investment (including the reinvestment of all dividends) in our common stock and in each index from December 31, 2020 through December 31, 2025. The stock price performance included in this graph is not necessarily indicative of future stock price performance.
Item 5. MARKET FO R REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information PCA’s common stock is listed on the New York Stock Exchange (NYSE) under the symbol “PKG.” Stockholders On February 21, 2025, there were 151 holders of record of our common stock.
Item 5. MARKET FO R REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information PCA’s common stock is listed on the New York Stock Exchange (NYSE) under the symbol “PKG.” Stockholders On February 20, 2026, there were 146 holders of record of our common stock.
We withheld 142,552 shares in 2024 to cover $25.7 million in employee tax liabilities, 120,534 shares in 2023 to cover $15.7 million in employee tax liabilities, and 110,827 shares in 2022 to cover $15.4 million in employee tax liabilities.
We withheld 118,675 shares in 2025 to cover $23.6 million in employee tax liabilities, 142,552 shares in 2024 to cover $25.7 million in employee tax liabilities, and 120,534 shares in 2023 to cover $15.7 million in employee tax liabilities.
During the third and fourth quarters of 2022, we paid $522.6 million, including fees, to repurchase 4.0 million shares of common stock. All shares repurchased have been retired. Pursuant to its equity incentive plan, the Company withholds shares from vesting employee equity awards to cover employee tax liabilities.
During the third quarter of 2023, we paid $41.5 million, including fees, to repurchase 0.3 million shares of common stock. Pursuant to its equity incentive plan, the Company withholds shares from vesting employee equity awards to cover employee tax liabilities.
The timing and amount of repurchases will be determined by the Company in its discretion based on factors such as PCA’s stock price and market and business conditions. The Company did not repurchase any shares of its common stock under this authority during the year ended December 31, 2024.
The timing and amount of repurchases will be determined by the Company in its discretion based on factors such as PCA’s stock price and market and business conditions. During the fourth quarter of 2025, we paid $153.0 million, including fees, to repurchase 0.8 million shares of common stock.
Cumulative Total Return December 31, 2019 2020 2021 2022 2023 2024 Packaging Corporation of America $ 100.00 $ 127.27 $ 129.32 $ 125.90 $ 166.04 $ 235.24 S&P 500 100.00 118.40 152.39 124.79 157.59 197.02 S&P Midcap 400 100.00 113.66 141.80 123.28 143.54 163.54 The information in the graph and table above is not deemed “filed” with the Securities and Exchange Commission and is not to be incorporated by reference in any of PCA’s filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date of this Annual Report on Form 10-K, except to the extent that PCA specifically incorporates such information by reference.
Cumulative Total Return December 31, 2020 2021 2022 2023 2024 2025 Packaging Corporation of America $ 100.00 $ 101.61 $ 98.93 $ 130.46 $ 184.84 $ 173.59 S&P 500 100.00 128.71 105.40 133.10 166.40 196.16 S&P Midcap 400 100.00 124.76 108.47 126.29 143.88 154.68 Peer Group 100.00 103.66 79.72 87.83 136.29 102.63 The information in the graph and table above is not deemed “filed” with the Securities and Exchange Commission and is not to be incorporated by reference in any of PCA’s filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date of this Annual Report on Form 10-K, except to the extent that PCA specifically incorporates such information by reference. 18 Item 6. [ R ESERVED] 19
At December 31, 2024, $436.0 million of the authorized amount remained available for repurchase of the Company’s common stock. During the third quarter of 2023, we paid $41.5 million, including fees, to repurchase 0.3 million shares of common stock.
At December 31, 2025, $283.1 million of the authorized amount remained available for repurchase of the Company’s common stock. All shares repurchased have been retired. The Company did not repurchase any shares of its common stock under this authority during the year ended December 31, 2024.
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(b) Excludes commissions. 17 Performance Graph The graph below compares PCA’s cumulative 5-year total shareholder return on common stock with the cumulative total returns of the S&P 500 index, the S&P Midcap 400 index and a customized peer group of two companies that includes: International Paper and Smurfit Westrock.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeManagement’s Discussion and Analysis of Financial Condition and Results of Operations 19 Overview 19 Executive Summary 19 Industry and Business Conditions 20 Results of Operations 21 Liquidity and Capital Resources 23 Commitments 24 Off-Balance Sheet Arrangements 25 Inflation and Other General Cost Increases 25 Regulatory and Environmental Matters 25 Critical Accounting Policies and Estimates 27 New and Recently Adopted Accounting Standards 28 Non-GAAP Financial Measures 29 Item 7A.
Biggest changeManagement’s Discussion and Analysis of Financial Condition and Results of Operations 20 Overview 20 Executive Summary 20 Industry and Business Conditions 21 Results of Operations 22 Liquidity and Capital Resources 24 Commitments 26 Off-Balance Sheet Arrangements 26 Inflation and Other General Cost Increases 26 Regulatory and Environmental Matters 27 Critical Accounting Policies and Estimates 29 New and Recently Adopted Accounting Standards 30 Non-GAAP Financial Measures 31 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk 30 Item 8. Financial Statements and Supplementary Data 31
Quantitative and Qualitative Disclosures About Market Risk 33 Item 8. Financial Statements and Supplementary Data 34
Item 6. Selected Financial Data 18 Item 7.
Item 6. Selected Financial Data 19 Item 7.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table reconciles net income to net income excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2024 2023 Income before Taxes Income Taxes Net Income Income before Taxes Income Taxes Net Income As reported in accordance with GAAP $ 1,064.4 $ (259.3 ) $ 805.1 $ 1,014.1 $ (248.9 ) $ 765.2 Special items: Jackson mill conversion-related activities (d) 9.7 (2.4 ) 7.3 11.1 (2.7 ) 8.4 Facilities closure and other costs (e) 2.7 (0.6 ) 2.1 14.4 (3.6 ) 10.8 Total special items 12.4 (3.0 ) 9.4 25.5 (6.3 ) 19.2 Excluding special items $ 1,076.8 $ (262.3 ) $ 814.5 $ 1,039.6 $ (255.2 ) $ 784.4 (d) For 2024 and 2023, includes charges related to the announced discontinuation of production of uncoated freesheet paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.
Biggest change(d) For 2024, includes $9.7 million of charges related to the announced discontinuation of production of uncoated freesheet paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities. 31 The following table reconciles net income to net income excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2025 2024 Income before Taxes Income Taxes Net Income Income before Taxes Income Taxes Net Income As reported in accordance with GAAP $ 1,027.8 $ (253.7 ) $ 774.1 $ 1,064.4 $ (259.3 ) $ 805.1 Special items: Facilities closure and other (income) costs (e) (10.4 ) 2.5 (7.9 ) 2.7 (0.6 ) 2.1 Wallula mill restructuring (f) 128.0 (31.3 ) 96.7 — — — Acquisition and integration-related costs (g) 33.2 (8.1 ) 25.1 — — — Jackson mill conversion-related activities (h) — — — 9.7 (2.4 ) 7.3 Total special items 150.8 (36.9 ) 113.9 12.4 (3.0 ) 9.4 Excluding special items $ 1,178.6 $ (290.6 ) $ 888.0 $ 1,076.8 $ (262.3 ) $ 814.5 (e) For 2025, includes income related to gains on sales of corrugated products facilities and a gain on an asset disposal of a closed corrugated products facility, partially offset by charges related to the closure of corrugated products facilities.
Included in this Item 7 are various non-GAAP financial measures, including earnings per diluted share excluding special items, net income excluding special items, earnings before non-operating pension income (expense), interest, income taxes, and depreciation, amortization, and depletion (“EBITDA”), segment EBITDA, EBITDA excluding special items, and segment EBITDA excluding special items.
Included in this Item 7 are various non-GAAP financial measures, including earnings per diluted share excluding special items, net income excluding special items, earnings before non-operating pension (expense) income, interest, income taxes, and depreciation, amortization, and depletion (“EBITDA”), segment EBITDA, EBITDA excluding special items, and segment EBITDA excluding special items.
In addition, we and our industry support the American Forest & Paper Association’s goal of a 50% reduction in Scope 1 and Scope 2 greenhouse gas emissions intensity by 2030 from a 2005 baseline. We have a carbon neutrality team, consisting of a cross-functional group of key operational, engineering, environmental, and sustainability personnel to lead our efforts.
In addition, we and our industry support the American Forest & Paper Association’s goal of a 50% reduction in Scope 1 and Scope 2 greenhouse gas emissions intensity by 2030 from a 2005 baseline. We have a carbon neutrality team, consisting of a cross-functional group of key operational, engineering, environmental, legal and sustainability personnel to lead our efforts.
While we believe that the assumptions used to measure our pension obligations are reasonable, differences in actual experience or changes in assumptions may materially affect our pension obligations and future expense. We believe that the accounting estimate related to pensions is a critical accounting estimate because it is highly susceptible to change from period to period.
While we believe that the assumptions used to measure our pension obligations are reasonable, differences in actual experience or changes in assumptions may materially affect our pension obligations and future expense. 29 We believe that the accounting estimate related to pensions is a critical accounting estimate because it is highly susceptible to change from period to period.
Of particular importance are laws and regulations relating to the environment and health and safety matters. 25 Environmental compliance requirements are a significant factor affecting our business. We employ processes in the manufacture of containerboard, paper, and pulp, which result in various discharges, emissions and waste disposal.
Of particular importance are laws and regulations relating to the environment and health and safety matters. Environmental compliance requirements are a significant factor affecting our business. We employ processes in the manufacture of containerboard, paper, and pulp, which result in various discharges, emissions and waste disposal.
Financial Statements and Supplementary Data” of this Form 10-K for more information on our asset retirement obligation at the end of the period. 24 • Purchase commitments. Purchase commitments relate to various purchase agreements for items such as minimum amounts of energy and fiber purchases.
Financial Statements and Supplementary Data” of this Form 10-K for more information on our asset retirement obligation at the end of the period. • Purchase commitments. Purchase commitments relate to various purchase agreements for items such as minimum amounts of energy and fiber purchases.
Additionally, in September 2024, we received $400 million in net proceeds from the maturity of our investments in time deposits, which were used to repay our 3.65% senior notes that were due on September 15, 2024.
In September 2024, we received $400 million in net proceeds from the maturity of our investments in time deposits, which were used to repay our 3.65% senior notes that were due on September 15, 2024.
Accumulated losses in excess of 10% of the greater of the projected benefit obligation or the market-related value of assets will be recognized on a straight-line basis over the average remaining service period of active employees in the PCA plans (which is between five and nine years) and over the average remaining lifetime of inactive participants of the Boise plan (which is approximately 22 years), to the extent that losses are not offset by gains in subsequent years.
Accumulated losses in excess of 10% of the greater of the projected benefit obligation or the market-related value of assets will be recognized on a straight-line basis over the average remaining service period of active employees in PCA plans (which is between five and eight years) and over the average remaining lifetime of inactive participants in the Boise plan (which is approximately 22 years), to the extent that losses are not offset by gains in subsequent years.
The sensitivities may not be additive, so the impact of changing multiple factors simultaneously cannot be calculated by combining the individual sensitivities shown. For more information related to our pension benefit plans, see Note 12, Employee Benefit Plans and Other Postretirement Benefits, of the Notes to Consolidated Financial Statements in “Part II, Item 8.
The sensitivities may not be additive, so the impact of changing multiple factors simultaneously cannot be calculated by combining the individual sensitivities shown. For more information related to our pension benefit plans, see Note 13, Employee Benefit Plans and Other Postretirement Benefits, of the Notes to Consolidated Financial Statements in “Part II, Item 8.
See Note 19, Commitments, Guarantees, Indemnifications, and Legal Proceedings, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our purchase commitments and the timing of expected future payments. • Employee benefit obligations.
See Note 20, Commitments, Guarantees, Indemnifications, and Legal Proceedings, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our purchase commitments and the timing of expected future payments. • Employee benefit obligations.
See Note 12, Employee Benefits Plans and Other Postretirement Benefits, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our employee benefit obligations and the timing of expected future benefit payments under our pension plans and postretirement plans.
See Note 13, Employee Benefits Plans and Other Postretirement Benefits, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our employee benefit obligations and the timing of expected future benefit payments under our pension plans and postretirement plans.
Financial Statements and Supplementary Data” of this Form 10-K for more information on our lease obligations and the timing of expected future payments. • Asset retirement obligations. See Note 13, Asset Retirement Obligations, of the Consolidated Financial Statements included in “Part II, Item 8.
Financial Statements and Supplementary Data” of this Form 10-K for more information on our lease obligations and the timing of expected future payments. • Asset retirement obligations. See Note 14, Asset Retirement Obligations, of the Consolidated Financial Statements included in “Part II, Item 8.
The national emissions standards for hazardous air pollutants (NESHAP) for Chemical Recovery Combustion Sources at pulp mills is due for residual risk and technology review (RTR). In November 2024, PCA was one of seven companies selected by EPA to respond to an extensive questionnaire about operations and equipment to support EPA’s requirement to revise existing Pulp MACT standards.
The national emissions standards for hazardous air pollutants (NESHAP) for Chemical Recovery Combustion Sources at pulp mills is due for residual risk and technology review (RTR). In November 2024, PCA was one of seven companies selected by EPA to respond to a questionnaire about operations and equipment to support EPA’s requirement to revise existing Pulp MACT standards.
Commit ments Contractual Obligations Our cash requirements greater than twelve months from contractual obligations and commitments include: • Debt obligations and interest payments. See Note 10, Debt, of the Consolidated Financial Statements included in “Part II, Item 8.
Commit ments Contractual Obligations Our cash requirements greater than twelve months from contractual obligations and commitments include: • Debt obligations and interest payments. See Note 11, Debt, of the Consolidated Financial Statements included in “Part II, Item 8.
Off-B alance Sheet Arrangements The Company does not have any off-balance sheet arrangements as of December 31, 2024. Inflation and Other G eneral Cost Increases We are subject to both contractual, inflation, and other general cost increases.
Off-B alance Sheet Arrangements The Company does not have any off-balance sheet arrangements as of December 31, 2025. Inflation and Other G eneral Cost Increases We are subject to both contractual, inflation, and other general cost increases.
The following table for 2024 provides the total MMBTUs purchased externally by fuel type each quarter and the average cost per MMBTU by fuel type for the year. The cost per MMBTU includes the cost of the fuel plus our transportation and delivery costs. 2024 Fuel Purchased (millions of MMBTUs) 2024 Avg.
The following table for 2025 provides the total MMBTUs purchased externally by fuel type each quarter and the average cost per MMBTU by fuel type for the year. The cost per MMBTU includes the cost of the fuel plus our transportation and delivery costs. 2025 Fuel Purchased (millions of MMBTUs) 2025 Avg.
Certain items of product input costs have historically been subject to more cost volatility including fiber, purchased energy, and chemicals. Energy Our mills represent about 90% of our total purchased fuel costs. In 2024, our Packaging and Paper mills consumed about 101 million MMBTUs of fuel, including internally generated and externally purchased, to produce both steam and electricity.
Certain items of product input costs have historically been subject to more cost volatility including fiber, purchased energy, and chemicals. 26 Energy Our mills represent about 90% of our total purchased fuel costs. In 2025, our Packaging and Paper mills consumed about 101 million MMBTUs of fuel, including internally generated and externally purchased, to produce both steam and electricity.
Financial Statements and Supplementary Data” of this Form 10-K. 28 Non-GAAP Finan cial Measures Earnings per diluted share excluding special items, net income excluding special items, EBITDA, EBITDA excluding special items, segment EBITDA, and segment EBITDA excluding special items are non-GAAP financial measures.
Financial Statements and Supplementary Data” of this Form 10-K. 30 Non-GAAP Finan cial Measures Earnings per diluted share excluding special items, net income excluding special items, EBITDA, EBITDA excluding special items, segment EBITDA, and segment EBITDA excluding special items are non-GAAP financial measures.
The details of capital expenditures for property and equipment by segment for the years ended December 31, 2024 and 2023 are included in the table below (dollars in millions).
The details of capital expenditures for property and equipment by segment for the years ended December 31, 2025 and 2024 are included in the table below (dollars in millions).
For our discussion and analysis of our results of operations, financial condition and cash flows for the year ended December 31, 2022, the earliest of the years presented in the accompanying audited financial statements included in Item 8 herein, please refer to our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 29, 2024.
For our discussion and analysis of our results of operations, financial condition and cash flows for the year ended December 31, 2023, the earliest of the years presented in the accompanying audited financial statements included in Item 8 herein, please refer to our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission on February 27, 2025.
These expenditures could increase or decrease as a result of a number of factors, including our financial results, strategic opportunities, future economic conditions, and our regulatory compliance requirements. We currently estimate capital expenditures to comply with environmental regulations will be about $24 million in 2025.
These expenditures could increase or decrease as a result of a number of factors, including our financial results, strategic opportunities, future economic conditions, and our regulatory compliance requirements. We currently estimate capital expenditures to comply with environmental regulations will be about $21 million in 2026.
Over view PCA is the third largest producer of containerboard products and a leading producer of uncoated freesheet paper in North America. We operate eight mills and 86 corrugated products manufacturing plants. Our containerboard mills produce linerboard and corrugating medium, which are papers primarily used in the production of corrugated products.
Over view PCA is the third largest producer of containerboard products and a leading producer of uncoated freesheet paper in North America. We operate ten mills and 91 corrugated products manufacturing plants. Our containerboard mills produce linerboard and corrugating medium, which are papers primarily used in the production of corrugated products.
We provide important disclosures regarding our presentation of non-GAAP financial measures and reconciliations of presented non-GAAP financial measures to the most comparable measures presented in accordance with GAAP later in this section under the caption “Non-GAAP Financial Measures.” Executive Summary Net sales were $8.4 billion for the year ended December 31, 2024 and $7.8 billion for 2023.
We provide important disclosures regarding our presentation of non-GAAP financial measures and reconciliations of presented non-GAAP financial measures to the most comparable measures presented in accordance with GAAP later in this section under the caption “Non-GAAP Financial Measures.” Executive Summary Net sales were $9.0 billion for the year ended December 31, 2025 and $8.4 billion for 2024.
The purchases by quarter and the average cost per CkWh were as follows: 2024 Purchased Electricity (millions of CkWh) 2024 Avg.
The purchases by quarter and the average cost per CkWh were as follows: 2025 Purchased Electricity (millions of CkWh) 2025 Avg.
Actual results that differ from assumptions are accumulated and amortized over future periods and, therefore, generally affect recognized expense in future periods. At December 31, 2024, we had $43.5 million of actuarial losses and prior service costs, net of tax, recorded in “Accumulated other comprehensive loss” on our Consolidated Balance Sheet.
Actual results that differ from assumptions are accumulated and amortized over future periods and, therefore, generally affect recognized expense in future periods. At December 31, 2025, we had $41.8 million of actuarial losses and prior service costs, net of tax, recorded in “Accumulated other comprehensive loss” on our Consolidated Balance Sheet.
Such information is presented in Item 7 of such report under the subcaptions “Results of Operations —Year Ended December 31, 2023, Compared with Year Ended December 31, 2022” and “Liquidity and Capital Resources” and is incorporated by reference herein.
Such information is presented in Item 7 of such report under the subcaptions “Results of Operations —Year Ended December 31, 2024, Compared with Year Ended December 31, 2023” and “Liquidity and Capital Resources” and is incorporated by reference herein.
The following table presents selected assumptions used and expected to be used in the measurement of pension expense in the following periods (dollars in millions): Year Ending December 31, Year Ended December 31, 2025 2024 2023 Pension expense $ 10.7 $ 8.0 $ 22.1 Assumptions Discount rate 5.56 % 4.86 % 5.06 % Expected rate of return on plan assets 5.71 % 5.80 % 5.52 % A change of 0.25% in either direction to the discount rate or the expected rate of return on plan assets would have had the following effect on 2024 and 2025 pension expense (dollars in millions): Increase (Decrease) in Pension Expense(a) Base Expense 0.25% Increase 0.25% Decrease 2024 Discount rate $ 8.0 $ 0.7 $ 1.4 Expected rate of return on plan assets 8.0 (2.8 ) 2.8 2025 Discount rate $ 10.7 $ 0.9 $ (0.6 ) Expected rate of return on plan assets 10.7 (2.7 ) 2.7 (a) The sensitivities shown above are specific to 2024 and 2025.
The following table presents selected assumptions used and expected to be used in the measurement of pension expense in the following periods (dollars in millions): Year Ending December 31, Year Ended December 31, 2026 2025 2024 Pension expense $ 3.7 $ 10.4 $ 8.0 Assumptions Discount rate 5.35 % 5.56 % 4.86 % Expected rate of return on plan assets 5.66 % 5.71 % 5.80 % A change of 0.25% in either direction to the discount rate or the expected rate of return on plan assets would have had the following effect on 2025 and 2026 pension expense (dollars in millions): Increase (Decrease) in Pension Expense(a) Base Expense 0.25% Increase 0.25% Decrease 2025 Discount rate $ 10.4 $ 0.9 $ (0.7 ) Expected rate of return on plan assets 10.4 (2.7 ) 2.7 2026 Discount rate $ 3.7 $ 1.0 $ (0.9 ) Expected rate of return on plan assets 3.7 (2.8 ) 2.8 (a) The sensitivities shown above are specific to 2025 and 2026.
From 2006 through 2024, there were no significant environmental remediation costs at PCA’s mills and corrugated plants. As of December 31, 2024, we maintained an environmental reserve of $25.8 million relating to on-site landfills and surface impoundments as well as ongoing and anticipated remedial projects.
From 2006 through 2025, there were no significant environmental remediation costs at PCA’s mills and corrugated plants. As of December 31, 2025, we maintained an environmental reserve of $30.9 million relating to on-site landfills and surface impoundments as well as ongoing and anticipated remedial projects.
The repayment of these notes was $400 million excluding accrued interest. See Note 10, Debt, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our debt.
The repayment of the old 3.65% notes was $400 million excluding accrued interest. 25 See Note 11, Debt, of the Consolidated Financial Statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K for more information on our debt.
As is the case with any industrial operation, PCA has, in the past, incurred costs associated with the remediation of soil or groundwater contamination, as required by the federal Comprehensive Environmental Response, Compensation and Liability Act, commonly known as the federal “Superfund” law, and analogous state laws.
Five of PCA’s mills will participate in the risk assessment. 27 As is the case with any industrial operation, PCA has, in the past, incurred costs associated with the remediation of soil or groundwater contamination, as required by the federal Comprehensive Environmental Response, Compensation and Liability Act, commonly known as the federal “Superfund” law, and analogous state laws.
Below is a summary table of our cash flows, followed by a discussion of our sources and uses of cash through operating activities, investing activities, and financing activities (dollars in millions): Year Ended December 31, 2024 2023 Net cash provided by (used for): Operating activities $ 1,191.2 $ 1,315.1 Investing activities (277.8 ) (875.1 ) Financing activities (876.4 ) (112.0 ) Net increase in cash and cash equivalents $ 37.0 $ 328.0 Operating Activities Our operating cash flow is primarily driven by our earnings and changes in operating assets and liabilities, such as accounts receivable, inventories, accounts payable and other accrued liabilities, as well as other factors described below.
Below is a summary table of our cash flows, followed by a discussion of our sources and uses of cash through operating activities, investing activities, and financing activities (dollars in millions): Year Ended December 31, 2025 2024 Net cash provided by (used for): Operating activities $ 1,557.5 $ 1,191.2 Investing activities (2,572.9 ) (277.8 ) Financing activities 859.4 (876.4 ) Net (decrease) increase in cash and cash equivalents $ (156.0 ) $ 37.0 Operating Activities Our operating cash flow is primarily driven by our earnings and changes in operating assets and liabilities, such as accounts receivable, inventories, accounts payable and other accrued liabilities, as well as other factors described below.
Paper segment operating income was $130 million in 2024, compared to $119 million in 2023. Paper segment EBITDA excluding special items was $154 million in 2024, compared to $151 million in 2023. 1 The increase was due primarily to higher paper volumes and lower operating costs, partially offset by lower prices and mix.
Paper segment operating income was $130 million in 2025 and in 2024. Paper segment EBITDA excluding special items was $148 million in 2025, compared to $154 million in 2024. 1 The decrease was due primarily to higher operating costs and lower paper volumes, partially offset by higher prices and mix.
In 2024, our total company costs including cost of sales (COS) and selling, general, and administrative expenses (SG&A) was $7.2 billion, and excluding non-cash costs (depreciation, depletion and amortization, pension and postretirement expense, and share-based compensation expense) was $6.6 billion. A 1% increase in COS and SG&A costs would increase costs by $72 million and cash costs by $66 million.
In 2025, our total company costs including cost of sales (COS) and selling, general, and administrative expenses (SG&A) was $7.7 billion, and excluding non-cash costs (depreciation, depletion and amortization, pension and postretirement expense, and share-based compensation expense) was $7.0 billion. A 1% increase in COS and SG&A costs would increase costs by $77 million and cash costs by $70 million.
We regularly work to identify and implement projects that will improve our efficiency. To what extent and when we embark upon major capital projects to reduce emissions will depend in part upon technology advancements, emerging regulatory and tax policies involving greenhouse gas emissions and incentives to invest in projects that reduce emissions.
We regularly work to identify and implement projects that will improve our efficiency. To what extent and when we embark upon major capital projects to reduce emissions will depend in part upon technology advancements, emerging regulatory and tax policies involving greenhouse gas emissions, assessment of risks and the economic impact of investing in projects that reduce emissions.
Financial Statements and Supplementary Data” of this Form 10-K. 27 We recognize the funded status of our pension plans on our Consolidated Balance Sheet and recognize the actuarial and experienced gains and losses and the prior service costs and credits as a component of “Accumulated Other Comprehensive Loss” in our Consolidated Statement of Changes in Stockholders’ Equity.
We recognize the funded status of our pension plans on our Consolidated Balance Sheet and recognize the actuarial and experienced gains and losses and the prior service costs and credits as a component of “Accumulated Other Comprehensive Loss” in our Consolidated Statement of Changes in Stockholders’ Equity.
We reported $805 million of net income, or $8.93 per diluted share, in 2024, compared to $765 million, or $8.48 per diluted share, in 2023. Net income included $9 million of expense for special items in 2024, compared to $19 million of expense for special items in 2023. Special items in both periods are described later in this section.
We reported $774 million of net income, or $8.58 per diluted share, in 2025, compared to $805 million, or $8.93 per diluted share, in 2024. Net income included $114 million of expense for special items in 2025, compared to $9 million of expense for special items in 2024. Special items in both periods are described later in this section.
For the year ended December 31, 2024, we spent $60 million, and for both the years ended December 31, 2023 and 2022, we spent $50 million, to comply with the requirements of these and other environmental laws. Additionally, we had $19 million of environmental capital expenditures in 2024, $14 million in 2023, and $11 million in 2022.
For the year ended December 31, 2025, 2024, and 2023, we spent $64 million, $60 million, and $50 million, respectively, to comply with the requirements of these and other environmental laws. Additionally, we had $27 million of environmental capital expenditures in 2025, $19 million in 2024, and $14 million in 2023.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Cost / CkWh Purchased electricity 5.3 5.2 6.0 5.9 22.4 $ 6.32 Regulatory and Environment al Matters Our operations are subject to compliance with the laws and regulations in the jurisdictions in which we operate, primarily in the United States.
First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Cost / CkWh Purchased electricity 5.6 5.6 6.1 6.7 24.0 $ 7.34 Regulatory and Environment al Matters Our operations are subject to compliance with the laws and regulations in the jurisdictions in which we operate, primarily in the United States.
During 2024, we recorded $259 million of income tax expense, compared to $249 million of income tax expense during 2023. The effective tax rate for 2024 and 2023 was 24.4% and 24.5%, respectively.
During 2025, we recorded $254 million of income tax expense, compared to $259 million of income tax expense during 2024. The effective tax rate for 2025 and 2024 was 24.7% and 24.4%, respectively.
The pension assumptions used to measure pension expense and liabilities are discussed in Note 12, Employee Benefit Plans and Other Postretirement Benefits, of the Notes to Consolidated Financial Statements in “Part II, Item 8.
The pension assumptions used to measure pension expense and liabilities are discussed in Note 13, Employee Benefit Plans and Other Postretirement Benefits, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K.
Cash from operations excluding changes in cash used for operating assets and liabilities increased $80 million, primarily due to higher income from operations in 2024 as discussed above.
Cash from operations excluding changes in cash used for operating assets and liabilities increased $211 million, primarily due to higher depreciation and higher deferred income tax liabilities in 2025 as discussed above.
Packaging segment EBITDA excluding special items was $1,598 million in 2024, compared to $1,556 million in 2023. 1 The increase was driven primarily by higher volumes, and lower freight and logistic expenses, partially offset by lower containerboard and corrugated products prices and mix, higher operating and converting costs and higher annual outage expense.
Packaging segment EBITDA excluding special items was $1,830 million in 2025, compared to $1,598 million in 2024. 1 The increase was driven primarily by higher containerboard and corrugated products prices and mix, higher volumes as a result of the Greif containerboard business, and lower fiber costs, partially offset by higher operating and converting costs, higher annual outage expense, higher fixed and other expense, and higher freight and logistic expenses.
Fuel Type First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Cost / MMBTU Natural gas 7.4 6.8 6.5 7.4 28.1 $ 3.54 Purchased bark 1.8 1.8 1.8 2.0 7.4 2.31 Other purchased fuels 0.2 0.1 0.1 0.1 0.5 7.04 Total mills 9.4 8.7 8.4 9.5 36.0 $ 3.34 In addition, the mills purchased 22.41 million CkWh (hundred kilowatt-hours) of electricity in 2024.
Fuel Type First Quarter Second Quarter Third Quarter Fourth Quarter Full Year Cost / MMBTU Natural gas 8.1 6.5 6.2 7.7 28.5 $ 4.28 Purchased bark 1.6 1.9 2.1 2.3 7.9 2.46 Other purchased fuels 0.1 0.1 0.1 0.1 0.4 5.12 Total mills 9.8 8.5 8.4 10.1 36.8 $ 3.90 In addition, the mills purchased 23.97 million CkWh (hundred kilowatt-hours) of electricity in 2025.
Cash requirements for operating activities are subject to PCA’s operating needs and the timing of collection of receivables and payments of payables and expenses. During 2024, net cash provided by operating activities was $1,191 million, compared to $1,315 million for 2023, a decrease of $124 million.
Cash requirements for operating activities are subject to PCA’s operating needs and the timing of collection of receivables and payments of payables and expenses. During 2025, net cash provided by operating activities was $1,558 million, compared to $1,191 million for 2024, an increase of $367 million.
Financial Statements” of this Form 10-K. Income from Operations Income from operations increased $26 million, or 2.4%, for the year ended December 31, 2024, compared to 2023. Income from operations in 2024 included $12 million of expense for special items compared to $25 million in 2023.
Financial Statements” of this Form 10-K. Income from Operations Income from operations increased $6 million, or 0.5%, for the year ended December 31, 2025, compared to 2024. Income from operations in 2025 included $151 million of expense for special items compared to $12 million in 2024.
The increase was primarily due to higher employee-related expenses and bad debt expense. 21 Other Expense, Net Other expense, net for the years ended December 31, 2024 and 2023 are set forth below (dollars in millions): Year Ended December 31, 2024 2023 Asset disposals and write-offs $ (39.7 ) $ (31.7 ) Jackson mill conversion-related activities (7.6 ) (1.8 ) Facilities closure and other costs (1.0 ) (7.9 ) DeRidder and other litigation (95.2 ) — DeRidder and other litigation insurance recoveries 95.2 — Other (23.2 ) (1.5 ) Total $ (71.5 ) $ (42.9 ) We discuss these items in more detail in Note 6, Other Expense, Net of the Condensed Notes to the Consolidated Financial Statements in “Part II, Item 8.
The increase was primarily due to higher employee-related expenses and higher depreciation related to the newly acquired business, partially offset by lower bad debt expense. 22 Other Expense, Net Other expense, net for the years ended December 31, 2025 and 2024 are set forth below (dollars in millions): Year Ended December 31, 2025 2024 Asset disposals and write-offs $ (40.8 ) $ (39.7 ) Facilities closure and other income (costs) 19.4 (1.0 ) DeRidder and other litigation (3.5 ) (95.2 ) DeRidder and other litigation insurance recoveries 3.5 95.2 Wallula mill restructuring (87.0 ) — Acquisition and integration-related costs (13.3 ) — Jackson mill conversion-related activities — (7.6 ) Other (26.7 ) (23.2 ) Total $ (148.4 ) $ (71.5 ) We discuss these items in more detail in Note 7, Other Expense, Net of the Condensed Notes to the Consolidated Financial Statements in “Part II, Item 8.
Labor and benefits costs will be higher due to timing-related items that occur at the beginning of a new year for annual increases, the restart of payroll taxes, and share-based compensation expenses. First quarter rail rate increases at three of our mills will impact freight and logistics expenses and we expect higher depreciation expense.
Labor and benefits costs will be higher due to timing-related items that occur at the beginning of a new year for annual increases, the restart of payroll taxes, and share-based compensation expenses. Freight will be slightly higher and we expect slightly lower depreciation expense. Scheduled outage expenses will be lower and we assume a lower corporate tax rate.
Year Ended December 31, 2024 2023 Packaging $ 626.6 $ 426.8 Paper 15.0 9.7 Corporate and Other 28.1 33.2 $ 669.7 $ 469.7 We expect capital investments in 2025 to be between $840 million and $870 million.
Year Ended December 31, 2025 2024 Packaging $ 779.3 $ 626.6 Paper 15.4 15.0 Corporate and Other 34.2 28.1 $ 828.9 $ 669.7 We expect capital investments in 2026 to be between $800 million and $870 million.
In 2024, gross profit included $3 million of special items expense related to Jackson mill conversion-related activities and corrugated facility closure and other costs, compared to $15 million of special items expense related to Jackson mill conversion-related activities and corrugated facility closure and other costs in 2023.
In 2025, gross profit included $70 million of special items expense related to Wallula mill restructuring, the Greif Acquisition, and corrugated facility closures. In 2024, gross profit included $3 million of special items expense related to Jackson mill conversion-related activities and corrugated facility closure and other costs.
Special items in 2024 included $10 million for Jackson mill conversion-related activities and $2 million of expense related to corrugated facility closure and other costs. Special items in 2023 included $14 million of expense related to corrugated facility closure and other costs and $11 million for Jackson mill conversion-related activities. Packaging.
Special items in 2025 included $128 million of expense for Wallula mill restructuring, $33 million of expense related to the Greif Acquisition and $10 million of income related to corrugated facility closures. Special items in 2024 included $10 million for Jackson mill conversion-related activities and $2 million of expense related to corrugated facility closure and other costs. Packaging.
(b) For 2024, includes $2.7 million of charges related to the closure of corrugated products facilities, partially offset by income primarily related to a favorable lease buyout for a closed corrugated products facility.
For 2024, includes $2.7 million of charges related to the closure of certain corrugated products facilities, partially offset by income primarily related to a favorable lease buyout for a closed corrugated products facility. (b) For 2025, includes $128.0 million of charges related to the announced discontinuation of the No. 2 machine and kraft pulping facilities at the Wallula, Washington mill.
Considering these items, we expect first quarter earnings to be lower than the fourth quarter of 2024. 20 Results of Operations Year Ended December 31, 2024, Compared with Year Ended December 31, 2023 The historical results of operations of PCA for the years ended December 31, 2024 and 2023 are set forth below (dollars in millions): Year Ended December 31, 2024 2023 Change Packaging $ 7,690.9 $ 7,135.6 $ 555.3 Paper 624.7 595.4 29.3 Corporate and other and eliminations 67.7 71.4 (3.7 ) Net sales $ 8,383.3 $ 7,802.4 $ 580.9 Packaging $ 1,101.5 $ 1,074.3 $ 27.2 Paper 129.7 118.9 10.8 Corporate and Other (129.9 ) (118.1 ) (11.8 ) Income from operations 1,101.3 1,075.1 26.2 Non-operating pension income (expense) 4.5 (7.7 ) 12.2 Interest expense, net (41.4 ) (53.3 ) 11.9 Income before taxes 1,064.4 1,014.1 50.3 Income tax expense (259.3 ) (248.9 ) (10.4 ) Net income $ 805.1 $ 765.2 $ 39.9 Net income excluding special items (a) $ 814.5 $ 784.4 $ 30.1 EBITDA (a) $ 1,626.9 $ 1,592.8 $ 34.1 EBITDA excluding special items (a) $ 1,637.1 $ 1,603.8 $ 33.3 (a) See “Non-GAAP Financial Measures” included in this Item 7 for a reconciliation of non-GAAP measures to the most comparable GAAP measure.
Considering these items, we expect first quarter earnings to be lower than the fourth quarter of 2025. 21 Results of Operations Year Ended December 31, 2025 Compared with Year Ended December 31, 2024 The historical results of operations of PCA for the years ended December 31, 2025 and 2024 are set forth below (dollars in millions): Year Ended December 31, 2025 2024 Change Packaging $ 8,293.9 $ 7,690.9 $ 603.0 Paper 615.4 624.7 (9.3 ) Corporate and other and eliminations 80.0 67.7 12.3 Net sales $ 8,989.3 $ 8,383.3 $ 606.0 Packaging $ 1,125.3 $ 1,101.5 $ 23.8 Paper 129.6 129.7 (0.1 ) Corporate and Other (147.9 ) (129.9 ) (18.0 ) Income from operations 1,107.0 1,101.3 5.7 Non-operating pension (expense) income (0.1 ) 4.5 (4.6 ) Interest expense, net (79.1 ) (41.4 ) (37.7 ) Income before taxes 1,027.8 1,064.4 (36.6 ) Income tax expense (253.7 ) (259.3 ) 5.6 Net income $ 774.1 $ 805.1 $ (31.0 ) Net income excluding special items (a) $ 888.0 $ 814.5 $ 73.5 EBITDA (a) $ 1,759.8 $ 1,626.9 $ 132.9 EBITDA excluding special items (a) $ 1,861.6 $ 1,637.1 $ 224.5 (a) See “Non-GAAP Financial Measures” included in this Item 7 for a reconciliation of non-GAAP measures to the most comparable GAAP measure.
Segment operating income increased $28 million to $1,102 million, compared to $1,074 million in 2023.
Segment operating income increased $24 million to $1,125 million, compared to $1,102 million in 2024.
Critical Accounting Po licies and Estimates Management’s discussion and analysis of financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
We do not believe that future compliance with health and safety laws and regulations will have a material adverse effect on our financial condition, results of operations or cash flows. 28 Critical Accounting Po licies and Estimates Management’s discussion and analysis of financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
These costs were partially offset by a gain on sale of a corrugated products facility. 29 The following table reconciles net income to EBITDA and EBITDA excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2024 2023 Net income $ 805.1 $ 765.2 Non-operating pension (income) expense (4.5 ) 7.7 Interest expense, net 41.4 53.3 Provision for income taxes 259.3 248.9 Depreciation, amortization, and depletion 525.6 517.7 EBITDA $ 1,626.9 $ 1,592.8 Special items: Jackson mill conversion-related activities 8.3 2.1 Facilities closure and other costs 1.9 8.9 EBITDA excluding special items $ 1,637.1 $ 1,603.8 The following table reconciles segment operating income (loss) to segment EBITDA and segment EBITDA excluding special items (dollars in millions): Year Ended December 31, 2024 2023 Packaging Segment operating income $ 1,101.5 $ 1,074.3 Depreciation, amortization, and depletion 490.1 472.5 EBITDA 1,591.6 1,546.8 Facilities closure and other costs 1.9 8.9 Jackson mill conversion-related activities 4.0 — EBITDA excluding special items $ 1,597.5 $ 1,555.7 Paper Segment operating income $ 129.7 $ 118.9 Depreciation, amortization, and depletion 19.5 29.6 EBITDA 149.2 148.5 Jackson mill conversion-related activities 4.3 2.1 EBITDA excluding special items $ 153.5 $ 150.6 Corporate and Other Segment operating loss $ (129.9 ) $ (118.1 ) Depreciation, amortization, and depletion 16.0 15.6 EBITDA (113.9 ) (102.5 ) EBITDA excluding special items $ (113.9 ) $ (102.5 )
The following table reconciles net income to EBITDA and EBITDA excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2025 2024 Net income $ 774.1 $ 805.1 Non-operating pension expense (income) 0.1 (4.5 ) Interest expense, net 79.1 41.4 Provision for income taxes 253.7 259.3 Depreciation, amortization, and depletion 652.8 525.6 EBITDA $ 1,759.8 $ 1,626.9 Special items: Facilities closure and other (income) costs (18.5 ) 1.9 Wallula mill restructuring 87.0 — Acquisition and integration-related costs 33.3 — Jackson mill conversion-related activities — 8.3 EBITDA excluding special items $ 1,861.6 $ 1,637.1 32 The following table reconciles segment operating income (loss) to segment EBITDA and segment EBITDA excluding special items (dollars in millions): Year Ended December 31, 2025 2024 Packaging Segment operating income $ 1,125.3 $ 1,101.5 Depreciation, amortization, and depletion 616.1 490.1 EBITDA 1,741.4 1,591.6 Facilities closure and other (income) costs (18.5 ) 1.9 Wallula mill restructuring 87.0 — Acquisition and integration-related costs 20.0 — Jackson mill conversion-related activities — 4.0 EBITDA excluding special items $ 1,829.9 $ 1,597.5 Paper Segment operating income $ 129.6 $ 129.7 Depreciation, amortization, and depletion 18.5 19.5 EBITDA 148.1 149.2 Jackson mill conversion-related activities — 4.3 EBITDA excluding special items $ 148.1 $ 153.5 Corporate and Other Segment operating loss $ (147.9 ) $ (129.9 ) Depreciation, amortization, and depletion 18.2 16.0 EBITDA (129.7 ) (113.9 ) Acquisition and integration-related costs 13.3 — EBITDA excluding special items $ (116.4 ) $ (113.9 )
Selling, General, and Administrative Expenses Selling, general, and administrative expenses (SG&A) increased $29 million in 2024 compared to 2023.
Selling, General, and Administrative Expenses Selling, general, and administrative expenses (“SG&A”) increased $24 million in 2025 compared to 2024.
Special items in 2023 included $11 million of expense for Jackson mill conversion-related activities. Non-Operating Pension Income, Interest Expense, Net and Income Taxes During 2024, non-operating pension income increased $12 million compared to 2023. The increase in non-operating pension income was related to favorable 2023 asset performance and favorable assumption changes.
Additional benefit was due to no significant special items in 2025 compared to $6 million of expense for Jackson mill conversion-related activities in 2024. Non-Operating Pension Expense, Interest Expense, Net and Income Taxes During 2025, non-operating pension expense increased $5 million compared to 2024.
Reported industry containerboard production increased 4.7% compared to 2023, and reported industry containerboard inventories at the end of 2024 were approximately 2.8 million tons, up 5.7% compared to 2023. Reported containerboard export shipments increased 15.4% compared to 2023.
Reported industry containerboard production decreased (4.5%) compared to 2024, and reported industry containerboard inventories at the end of 2025 were approximately 2.8 million tons, up 1.3% compared to 2024. Reported containerboard export shipments decreased (11.4%) compared to 2024. In February 2025, index prices increased $40 per ton for linerboard and for corrugating medium.
Special items in 2024 included $4 million of expense for Jackson mill conversion-related activities and $2 million of expense for corrugated facility closure and other costs. Special items in 2023 included $14 million of expense for corrugated facility closure and other costs. Paper. Segment operating income increased $11 million to $130 million, compared to $119 million in 2023.
Special items in 2025 included $128 million of expense for Wallula mill restructuring, $20 million of expense related to the Greif Acquisition and $10 million of income related to corrugated facility closures. Special items in 2024 included $4 million of expense for Jackson mill conversion-related activities and $2 million of expense for corrugated facility closure and other costs. Paper.
The increase was driven primarily by higher volumes, and lower freight and logistic expenses, partially offset by lower containerboard and corrugated products prices and mix, higher operating and converting costs and higher annual outage expense.
The increase was driven primarily by higher prices and mix in the Packaging and Paper segments, higher volumes in the Packaging segment, and lower fiber costs, partially offset by higher operating and converting costs, higher maintenance outage expense, higher fixed and other expense, higher freight expense, and lower volume in the Paper Segment.
We notified customers of a $60 per ton price increase for all office, printing, and converting papers, effective January 13, 2025. Industry and Busi ness Conditions Trade publications reported North American industry-wide corrugated products shipments were relatively flat in 2024, compared to 2023.
Paper prices and mix reflected our 2025 price increase for office, printing, and converting papers. Industry and Busi ness Conditions Trade publications reported North American industry-wide corrugated products shipments were down (1.8%) in 2025, compared to 2024.
The Company believes that it is not reasonably possible that future environmental expenses above the $25.8 million accrued at December 31, 2024, will have a material impact on its financial condition, results of operations, and cash flows. 26 While legislation regarding the regulation of greenhouse gas emissions has been proposed at the federal level, it is uncertain whether such legislation will be passed and, if so, what the breadth and scope of such legislation will be.
The Company believes that it is not reasonably possible that future environmental expenses above the $30.9 million accrued at December 31, 2025, will have a material impact on its financial condition, results of operations, and cash flows.
As part of the questionnaire, EPA is requiring companies, including PCA, to undertake extensive pollutant testing scheduled to begin Spring 2025. President Trump’s Executive Order to suspend all federal rulemaking has paused EPA’s review process.
As part of the questionnaire, EPA is requiring companies, including PCA, to undertake pollutant testing scheduled to begin Spring 2026.
Cash decreased by $204 million due to changes in operating assets and liabilities, primarily due to the following: a) a net unfavorable change in prepaid expenses and other current assets in 2024 compared to 2023 primarily due to an increase in accrued receivables for the insurance recoveries related to pending litigation in 2024; b) a net unfavorable change in accounts receivable levels in 2024 compared to 2023 primarily due to higher sales and an increase in days sales outstanding in the Packaging segment during 2024; c) a net unfavorable change in inventories in 2024 compared to 2023 primarily due to an increase in Packaging segment inventory balances related to higher volume, partially offset by a favorable change in Paper segment inventory balances due to a smaller increase in Paper segment inventory balances in 2024 compared to 2023; and d) a net unfavorable change in income taxes in 2024 compared to 2023 primarily due to a larger decrease in income tax receivables in 2023 compared to 2024. 23 These unfavorable changes were partially offset by a net favorable change in accrued liabilities in 2024 compared to 2023 primarily related to higher accruals related to pending litigation in 2024 and higher accruals for employee compensation and benefit liabilities in 2024.
Cash increased by $156 million due to changes in operating assets and liabilities, primarily due to the following: a) a net favorable change in prepaid expenses and other current assets primarily related to the establishment of a receivable for the DeRidder trial and related insurance recoveries during 2024 and reduction of receivables against insurance carriers during 2025 related to the DeRidder settlement and settlement of other litigation; b) a net favorable change in inventories primarily resulting from a buildup in Packaging segment inventory levels during 2024 due to rising volume and certain customer inventory on hand requirements; and c) a net favorable change in accounts receivable due to a decrease in Packaging segment accounts receivable levels during 2024, which primarily related to higher sales volume and an increase in days sales outstanding in 2024 when compared to 2023.
The following table reconciles earnings per diluted share to earnings per diluted share excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2024 2023 Earnings per diluted share, as reported in accordance with GAAP $ 8.93 $ 8.48 Special items: Jackson mill conversion-related activities (a) 0.08 0.09 Facilities closure and other costs (b) 0.03 0.12 Total special items 0.11 0.21 Earnings per diluted share, excluding special items $ 9.04 $ 8.70 (c) (a) For 2024 and 2023, includes $9.7 million and $11.1 million, respectively, of charges related to the announced discontinuation of production of uncoated freesheet paper grades on the No. 3 machine at the Jackson, Alabama mill associated with the permanent conversion of the machine to produce linerboard and other paper-to-containerboard conversion related activities.
The following table reconciles earnings per diluted share to earnings per diluted share excluding special items for the periods indicated (dollars in millions): Year Ended December 31, 2025 2024 Earnings per diluted share, as reported in accordance with GAAP $ 8.58 $ 8.93 Special items: Facilities closure and other (income) costs (a) (0.09 ) 0.03 Wallula mill restructuring (b) 1.07 — Acquisition and integration-related costs (c) 0.28 — Jackson mill conversion-related activities (d) — 0.08 Total special items 1.26 0.11 Earnings per diluted share, excluding special items $ 9.84 $ 9.04 (a) For 2025, includes $10.4 million of income related to gains on sales of corrugated products facilities and a gain on an asset disposal related to a closed corrugated products facility, partially offset by charges related to the closure of certain corrugated products facilities.
The increase was due to higher volume ($49 million), partially offset by lower prices and mix ($19 million). Gross Profit Gross profit increased $84 million in 2024, compared to 2023.
Net sales decreased $9 million, or (1.5%), to $615 million, compared to $625 million in 2024. The decrease was due to lower volume ($20 million), partially offset by higher prices and mix ($11 million). Gross Profit Gross profit increased $107 million in 2025, compared to 2024.
The Company believes that of its significant accounting policies, the following involve a higher degree of judgment and/or complexity: Pensions The Company accounts for defined benefit pension plans in accordance with Accounting Standards Codification (“ASC”) 715, Compensation - Retirement Benefits .
Financial Statements and Supplementary Data” of this Form 10-K. Pensions The Company accounts for defined benefit pension plans in accordance with Accounting Standards Codification (“ASC”) 715, Compensation - Retirement Benefits .
For more information on our containerboard production and corrugated products shipments, refer to the table presented under the caption “Production and Shipments” in “Part I, Item 1. Business” of this Form 10-K. Containerboard prices published by industry publications increased in the first and second quarter of 2024, after declining late in 2022 and throughout 2023.
For more information on our containerboard production and corrugated products shipments, refer to the table presented under the caption “Production and Shipments” in “Part I, Item 1. Business” of this Form 10-K. We notified customers of a $70 per ton price increase for linerboard and medium effective March 1, 2026.
The increase, excluding special items, related primarily to higher sales and production volumes ($377 million) and lower freight expense ($30 million), partially offset by lower containerboard and corrugated products prices and mix ($211 million), higher operating and converting costs ($121 million), higher depreciation expense ($22 million), higher annual outage expense ($13 million), and other costs ($20 million).
The increase related primarily to higher containerboard and corrugated products prices and mix ($366 million), lower fiber costs ($59 million), and the impact of newly acquired Greif operations ($8 million), partially offset by higher operating and converting costs ($128 million), higher maintenance outage expenses ($40 million), lower legacy sales and production volumes ($39 million), higher depreciation expense ($33 million), higher fixed and other costs ($22 million), and higher freight expense ($16 million).
Financial Statements and Supplementary Data” of this Form 10-K as well as information provided below under “—Investing Activities” and “—Financing Activities” for further information. Currently, our primary uses of cash are for operations, capital expenditures, acquisitions, debt service, common stock dividends, and repurchases of common stock.
Currently, our primary uses of cash are for operations, capital expenditures, acquisitions, debt service, common stock dividends, and repurchases of common stock.
(e) For 2024, includes charges related to the closure of corrugated products facilities. These costs were partially offset by income primarily related to a favorable lease buyout for a closed corrugated products facility during the first quarter of 2024. For 2023, includes charges related to the closure of corrugated products facilities and design centers.
For 2024, includes charges related to the closure of corrugated products facilities, partially offset by income primarily related to a favorable lease buyout for a closed corrugated products facility. (f) For 2025, includes charges related to the announced discontinuation of the No. 2 paper machine and kraft pulping facilities at the Wallula, Washington mill.
We ended the year with $685 million of cash and cash equivalents, $167 million of marketable debt securities, and $323 million of unused borrowing capacity under the revolving credit facility, net of letters of credit.
We ended the year with $529 million of cash and cash equivalents, $139 million of marketable debt securities, and $573 million of unused borrowing capacity under the revolving credit facility, net of letters of credit. On July 31, 2025, the Company entered into two credit agreements (the “Commercial Credit Agreement” and the “Farm Credit Agreement,” collectively, the “Credit Agreements”).
We withheld shares to cover $26 million of employee restricted stock taxes in 2024 compared to $16 million of employee restricted stock taxes withheld in 2023. We did not repurchase any shares of the Company’s common stock in 2024, compared to repurchases of 0.3 million shares for $42 million in 2023.
We paid $450 million in dividends on our common stock in 2025 compared to $449 million in 2024 and withheld shares to cover $24 million of employee restricted stock taxes in 2025 compared to $26 million in 2024. We repurchased and retired 0.8 million shares of the Company’s common stock for $153 million in 2025.
PCA ended the year with $852 million of cash and marketable debt securities and, including borrowing availability under its revolving credit facility, $1,175 million in liquidity. Packaging segment operating income was $1,102 million in 2024, compared to $1,074 million for 2023.
PCA ended the year with $668 million of cash and marketable debt securities and, including borrowing availability under its revolving credit facility, $1,241 million in liquidity. 1 Net income excluding special items, earnings per diluted share excluding special items, and segment EBITDA excluding special items are non-GAAP financial measures.
Domestic prices are expected to be higher with an improved product mix together with our previously announced price increases. Export prices are assumed to be stable. In our Paper segment, we forecast slightly lower volume with two less mill operating days and prices and mix to be fairly flat.
Domestic containerboard and corrugated products prices will be higher with an improved corrugated product mix throughout the quarter and we expect to benefit slightly from our previously announced containerboard price increases beginning in March. Export volume is expected to be slightly higher and prices are expected to be flat to slightly down.
The net proceeds received from the issuance of the new notes were invested in time deposits, which are included in marketable debt securities at December 31, 2023. On September 15, 2024, we used the net proceeds from this issuance, together with a portion of cash on hand, to repay our outstanding 3.65% senior notes due 2024.
On September 15, 2024, we used the net proceeds received from the November 2023 offering of the 5.70% senior notes due 2033 and cash on hand to repay our outstanding 3.65% senior notes due 2024.
Financing Activities In 2024, net cash used for financing activities was $876 million, compared to $112 million of cash used for financing activities in 2023, an increase of $764 million. We paid $449 million in dividends on our common stock in both 2024 and 2023.
Financing Activities In 2025, net cash provided by financing activities was $859 million, compared to $876 million of cash used for financing activities in 2024, an increase of $1,735 million.
Interest expense, net, during 2024 decreased $12 million compared to 2023. The decrease in interest expense, net in 2024 was primarily due to higher interest income due to higher rates on invested cash balances, partially offset by higher interest expense in 2024 related to the Company’s November 2023 debt refinancing.
The increase in interest expense, net was primarily due to higher interest expense in 2025 as a result of the Company’s financing for the Greif Acquisition and the November 2023 debt refinancing and lower interest income as a result of lower interest rates on lower cash balances due to the Greif Acquisition.
We are headquartered in Lake Forest, Illinois and operate primarily in the United States.
We are headquartered in Lake Forest, Illinois and operate primarily in the United States. On September 2, 2025, we completed the acquisition of the containerboard business of Greif, Inc. for $1.8 billion in cash.
Increasing shifts to these alternatives have reduced usage of traditional print media and communication papers. Trade publications reported North American uncoated freesheet paper shipments increased slightly 0.5% in 2024, compared to 2023. Average prices reported by a trade publication for cut size office papers were lower by $36 per ton, or (2.4%), in 2024 compared to 2023.
The market for communication papers competes heavily with electronic data transmission and document storage alternatives. Increasing shifts to these alternatives have reduced usage of traditional print media and communication papers. Trade publications reported North American uncoated freesheet paper shipments decreased (9.6%) in 2025, compared to 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2024, we are party to certain physical commodity transactions related to natural gas supply contracts. For a discussion of derivatives and hedging activities, see Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K.
Biggest changeAs of December 31, 2025, we are party to certain physical commodity transactions related to natural gas supply contracts. For a discussion of derivatives and hedging activities, see Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements in “Part II, Item 8. Financial Statements and Supplementary Data” of this Form 10-K.
Removed
At December 31, 2024, the interest rates on 100% of PCA’s outstanding debt are fixed. 30
Added
At December 31, 2025, the interest rates on approximately 75% of PCA’s debt are fixed. A one percent increase in interest rates related to variable-rate debt would have resulted in an increase in interest expense and a corresponding decrease in income before taxes of approximately $10 million annually. 33

Other PKG 10-K year-over-year comparisons