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What changed in SEALED AIR CORP/DE's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of SEALED AIR CORP/DE's 2022 and 2023 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 2023 report.

+478 added−540 removedSource: 10-K (2024-02-27) vs 10-K (2023-02-21)

Top changes in SEALED AIR CORP/DE's 2023 10-K

478 paragraphs added · 540 removed · 356 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

63 edited+26 added−53 removed24 unchanged
Biggest changeSEE is developing a strategy to mitigate climate change by establishing Science Based Targets, in line with the Science Based Targets initiative ("SBTi"), for our Scopes 1 and 2 GHG emissions. We have a goal of net-zero carbon dioxide emissions within our operations by 2040. We are developing long-term expenditure forecasts to meet our goals.
Biggest changeWithin our own operations, we are focused on reducing energy-intensity, diverting manufacturing waste from landfill and external incineration, and achieving water intensity reductions. We have a strategy to mitigate climate change with approved Science Based Targets for 2030, in line with the Science Based Targets initiative ("SBTi"), for Scopes 1 and 2 GHG emissions.
The vast majority of the raw materials required for the manufacture of our products and all components related to our equipment and accessories generally have been readily available on the open market and, in most cases, are available from several suppliers and are available in amounts sufficient to meet our manufacturing requirements.
The vast majority of the raw materials required for the manufacture of our products and all components related to our equipment and accessories generally have been readily available on the open market and, in most cases, are available from several suppliers and in amounts sufficient to meet our manufacturing requirements.
The SEC maintains an Internet site that contains these filings and they can be accessed via the Internet address https://www.sec.gov. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this Form 10-K. 13
The SEC maintains an Internet site that contains these filings and they can be accessed via the Internet address https://www.sec.gov. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this Form 10-K. 10
Key elements of this environmental management system are implemented throughout our operations. We believe that compliance with current environmental and workplace health and safety laws and regulations has not had a material effect on our capital expenditures or consolidated financial condition.
Key elements of this environmental management system are implemented throughout our 9 operations. We believe that compliance with current environmental and workplace health and safety laws and regulations has not had a material effect on our capital expenditures or consolidated financial condition.
Solutions serving the food retail market include products such as barrier bags, film, and trays, primarily marketed under the CRYOVAC ® trademark and other highly recognized trade names including CRYOVAC ® brand Grip & Tear™, CRYOVAC ® brand Darfresh ® , OptiDure™, Simple Steps ® , and CRYOVAC ® brand Barrier Bags.
Solutions serving the food retail market include products such as barrier bags, film, and trays, and are primarily marketed under the CRYOVAC ® trademark and other highly recognized trade names including CRYOVAC ® brand Grip & Tear™, CRYOVAC ® brand Darfresh ® , OptiDure™, Simple Steps ® , and CRYOVAC ® brand Barrier Bags.
See Note 6, “Segments,” set forth in Part II, Item 8, “Financial Statements and Supplementary Data” for further information. Food Food solutions are sold to food processors in fresh red meat, smoked and processed meats, poultry, seafood, plant-based, fluids and liquids and cheese markets worldwide.
See Note 6, “Segments,” set forth in Part II, Item 8, “Financial Statements and Supplementary Data” for further information. 7 Food Food solutions are sold to food processors in fresh red meat, smoked and processed meats, poultry, seafood, plant-based protein, fluids and liquids and cheese markets worldwide.
Our customer base is diverse, with no single customer or affiliated group of customers representing more than 10% of net sales in 2022, 2021 or 2020. Iconic Brands.
Our customer base is diverse, with no single customer or affiliated group of customers representing more than 10% of net sales in 2023, 2022 or 2021. Iconic Brands.
Solutions serving the food service market include products such as barrier bags and pouches, primarily marketed under the CRYOVAC ® trademark and other highly recognized trade names including CRYOVAC ® brand Barrier Bags, CRYOVAC ® brand Form-Fill-Seal Films, and CRYOVAC ® brand Auto Pouch Systems.
Solutions serving the food service market include products such as barrier bags and pouches, and are primarily marketed under the CRYOVAC ® trademark and other highly recognized trade names including CRYOVAC ® brand Barrier Bags, CRYOVAC ® brand Form-Fill-Seal Films, CRYOVAC ® brand Auto Pouch Systems and LIQUIBOX ® brand liquids systems.
We also generally employ: • marketing, sales, business development and technical packaging solutions professionals who work in the field and at our customers' facilities; • innovation, research and development, digital, automation and sustainability focused employees who work in one of our four comprehensive Packaging Solutions Development and Innovation Centers; and • customer service and support personnel as well as administrative and management employees who work in our offices and in remote environments.
We also generally employ: • Marketing, sales, business development and technical packaging solutions professionals who work in the field and at our customers' facilities; • Innovation, research and development, digital, automation and sustainability focused employees who work in our Packaging Solutions Development and Innovation Centers; and • Customer service and support personnel as well as administrative and management employees who work in our offices and in remote environments.
We strive to ensure these brands continue to represent our commitment to deliver safety, security, performance and innovation. Global Scale and Market Access. SEE serves a diverse global customer base with a sales and distribution network reaching 120 countries/territories. In 2022, 46% of net sales were from outside the U.S.
We strive to ensure these brands continue to represent our commitment to deliver safety, security, performance and innovation. Global Scale and Market Access. SEE serves a diverse global customer base with a sales and distribution network reaching 115 countries/territories. In 2023, 47% of net sales were from outside the U.S.
Our values represent the fundamental beliefs upon which we aim to base our business and behaviors. 7 Our Core Values Integrity Determined Collaborative Innovative Every day, we intentionally choose to do the right thing no matter the circumstance. We are empowered to deliver on our commitments.
Values, Code of Conduct and Ethics Our values represent the fundamental beliefs upon which we aim to base our business and behaviors. Our Core Values Integrity Determined Collaborative Innovative Every day, we intentionally choose to do the right thing no matter the circumstance. We are empowered to deliver on our commitments.
Our DEI Pledge and 2025 Goals, encompass the following: • Building a more inclusive culture with our employees across the globe; • Increasing gender diversity across employees globally to more than 30%; • Increasing the representation of racial and ethnic minorities in our U.S. workforce to above 35%; 9 • Leading with a senior leadership team that reflects the cultural diversity of our global footprint; and • Championing equal pay for work of equal value across our organization.
Our DEI Pledge and 2025 Goals encompass the following: • Build a more inclusive culture with our employees across the globe; • Increase gender diversity across employees globally to more than 30%; • Increase the representation of racial and ethnic minorities in our U.S. workforce to above 35%; • Lead with a senior leadership team that reflects the cultural diversity of our global footprint; and • Champion equal pay for work of equal value across our organization.
Food offers integrated packaging solutions combining high-performance materials and automated equipment solutions to increase food safety, extend shelf life, reduce food waste, automate processes and optimize total cost. Its innovative materials, automated equipment and service enables customers to reduce costs and enhance their brands in the marketplace.
Food offers integrated packaging materials and automated equipment solutions to increase food safety, extend shelf life, reduce food waste, automate processes, and optimize total cost. Its materials, automated equipment and service enable customers to reduce costs and enhance their brands in the marketplace.
Our portfolio of leading packaging solutions includes CRYOVAC ® brand food packaging, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated systems, BUBBLE WRAP ® brand packaging, SEE Automation™ solutions, and prismiq™ smart packaging and digital printing. Our iconic brands represent long-tenured leadership in the packaging industry and are propelling us forward into the future.
Our portfolio of leading packaging solutions includes CRYOVAC ® brand food packaging, LIQUIBOX ® brand liquids systems, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated systems and BUBBLE WRAP ® brand packaging. Our iconic brands represent long-tenured leadership in the packaging industry and are propelling us forward into the future.
Sealed Air Corporation (“SEE”, “Sealed Air”, or the “Company”, also referred to as “we”, “us”, or “our”) is a leading global provider of packaging solutions integrating sustainable, high-performance materials, automation, equipment and services. SEE designs and delivers packaging solutions that preserve food, protect goods, automate packaging processes, and enable e-commerce and digital connectivity for packaged goods.
Sealed Air Corporation (“SEE”, “Sealed Air”, or the “Company”, also referred to as “we”, “us”, or “our”) is a leading global provider of packaging solutions that integrate sustainable, high-performance materials, automation, equipment and services. SEE designs, manufactures and delivers packaging solutions that preserve food, protect goods and automate packaging processes.
As of December 31, 2022, 25% of our global employee base are female and 35% of our U.S. workforce belong to racial and ethnic minority groups. Biannually, SEE conducts a global comprehensive pay equity analysis to identify compensation disparities by gender across the world and by ethnic and racial diversity within the U.S.
As of December 31, 2023, 26% of our global employee base are female and 35% of our U.S. workforce identify with a racial and/or ethnic minority group. Biannually, SEE conducts a global comprehensive pay equity analysis to identify compensation disparities by gender across the world and by ethnic and racial diversity within the U.S.
In some jurisdictions in which our packaging products are sold or used, laws and regulations have been adopted or proposed that seek to regulate, among other things, minimum levels of recycled or reprocessed content and, more generally, the sale or disposal of packaging materials. We maintain programs designed to comply with these laws and regulations and to monitor their evolution.
In some jurisdictions in which our packaging products are sold or used, laws and regulations have been adopted or proposed that seek to regulate, among other things, minimum levels of recycled or reprocessed content and, more generally, the sale or disposal of packaging materials.
We operate through our subsidiaries and have a presence in the U.S. and 45 other countries/territories listed below. 5 Argentina Czech Republic Ireland Peru Sweden Australia Denmark Italy Philippines Switzerland Belgium Finland Japan Poland Taiwan Brazil France Luxembourg Portugal Thailand Canada Germany Malaysia Russia Ukraine Chile Greece Mexico Singapore United Arab Emirates China Guatemala Netherlands South Africa United Kingdom Colombia Hungary New Zealand South Korea Uruguay Costa Rica India Norway Spain Vietnam We face risks inherent in these international operations, such as currency fluctuations, supply chain disruptions, inflation and political instability.
Argentina Czech Republic Ireland Peru Spain Australia Denmark Italy Philippines Sweden Belgium Finland Japan Poland Switzerland Brazil France Luxembourg Portugal Taiwan Canada Germany Malaysia Russia Thailand Chile Greece Mexico Singapore United Arab Emirates China Guatemala Netherlands Slovakia United Kingdom Colombia Hungary New Zealand South Africa Uruguay Costa Rica India Norway South Korea Vietnam We face risks inherent in these international operations, such as currency fluctuations, supply chain disruptions, inflation and political instability.
We face risks inherent in achieving our sustainability goals, such as the cost for each initiative, changes in future regulations and policies that may be more restrictive than our stated goals, and the availability of resources (such as renewable energy credits, renewable energy sources, carbon offsets), among others.
We face risks inherent in achieving our sustainability goals, such as the cost for each initiative, changes in regulations and policies, and the availability of resources (including renewable energy credits, renewable energy sources, and carbon offsets), among others.
We have a formal process in place for managing, tracking, and reporting health and safety which includes incident analysis meetings which are conducted with leadership. Reporting is elevated to the regional leadership and global executive level monthly. Our global safety training program includes more than 150 preventive courses including behavioral-based safety training, hazard identification, and risk assessment.
We have a formal monthly process in place at the regional and global level for managing, tracking, and reporting health and safety which includes incident analysis meetings that are conducted with leadership. Our global safety training program includes more than 150 preventive courses including behavioral-based safety training, hazard identification, and risk assessment. All employees are trained before starting their job.
Food solutions are well aligned to capitalize on global market dynamics driven by increasing labor scarcity and automation, continued urbanization, growth in ship-to-home food services, growing consumer preference for smaller portions and healthier food choices, and demand for more sustainable, secure packaging. Our solutions, which include high-performance materials, equipment, and services, are designed to preserve nutrition while enhancing food safety.
Food solutions are well aligned to capitalize on global market dynamics driven by increasing labor scarcity and automation, continued urbanization, growth in ship-to-home food services, growing consumer preference for smaller portions and healthier food choices, and demand for more sustainable, secure packaging.
Innovation, Research and Development Our innovation, research and development capabilities encompass a broad range of disciplines including food science, materials science, chemical, mechanical, electrical and software engineering, microbiology, digital applications development, digital printing, and packaging automation equipment design and engineering.
Innovation, Research and Development Our innovation, research and development capabilities encompass a broad range of disciplines including food science, materials science, chemical, mechanical, electrical and software engineering, microbiology, digital applications development, digital printing, and packaging automation equipment design and engineering. Our research and development expense was $97 million in 2023, $103 million in 2022 and $100 million in 2021.
Our objective is to leverage our global scale to achieve purchasing efficiencies and reduce our total delivered cost across all our regions. We do this while adhering to strategic performance metrics and stringent purchasing practices. Seasonality On a consolidated basis, there is minimal seasonality in the business.
Our objective is to leverage our global scale to achieve purchasing efficiencies and reduce our total delivered cost across all our regions. We do this while adhering to strategic performance metrics and stringent purchasing practices.
However, the extent and timing of our results of operations may be difficult to predict if significant one-time transactions, events or non-recurring charges were to impact our business.
However, the extent and timing of our results of operations may be difficult to predict if significant one-time transactions, events or non-recurring charges were to impact our business. Additionally, changes in end-consumer behavior have in the past impacted the timing and seasonality of results of operations.
Within e-commerce and industrial markets, we offer a broad range of protective packaging materials and automation solutions that prevent product damage, increase order fulfillment velocity, and generate savings through reductions in waste, dimensional weight and labor. Well-established Customer Relationships . We have a broad and diversified customer base which includes the world’s leading food processors, e-commerce/fulfillment companies and industrial manufacturers.
Within e-commerce and industrial markets, we offer a broad range of protective packaging materials and automation solutions designed to prevent product damage, increase order fulfillment velocity, and generate savings through reductions in waste, dimensional weight and labor. Well-established Customer Relationships .
Although we purchase some raw materials under long-term supply 11 arrangements with third parties, these arrangements follow market forces and are in line with our overall global purchasing strategy, which seeks to balance the cost of acquisition and availability of supply. We have a centralized supply chain organization, which includes centralized management of purchasing and logistic activities.
Although we purchase some raw materials under long-term supply arrangements with third parties, these arrangements follow market forces and are in line with our overall global purchasing strategy, which seeks to balance the cost of acquisition and availability of supply. Seasonality On a consolidated basis, there is minimal seasonality in the business.
Other risks attendant to the environment and climate change are set forth in Part I, Item 1A, “Risk Factors,” of this Annual Report on Form 10-K, which is incorporated herein by reference. Human Capital Overview We are bringing people together with a future that is more digitally connected.
Other risks attendant to the environment and climate change are set forth in Part I, Item 1A, “Risk Factors,” of this Annual Report on Form 10-K, which is incorporated herein by reference. Human Capital Overview Our business strategy and outcomes are executed by our dedicated employees.
We believe that the expiration or unenforceability of any single one of our patents, applications, licenses or trademark registrations would not be material to our business or our consolidated financial condition, results of operations, or cash flows. Environmental Sustainability At SEE, environmental sustainability is integrated in our business strategy.
Our business is not dependent upon any single patent or trademark alone. The expiration or unenforceability of any single one of our patents, applications, licenses or trademark registrations would not be material to our business or our consolidated financial condition, results of operations, or cash flows.
Information on the impact of currency exchange on our Consolidated Financial Statements appears in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Financial information showing net sales for the year ended December 31, 2022 and total long-lived assets by geographic region as of December 31, 2022 appears in Note 6, “Segments,” set forth in Part II, Item 8, “Financial Statements and Supplementary Data,” which is incorporated herein by reference.
Information on the impact of currency exchange on our Consolidated Financial Statements appears in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Financial information showing net sales for the year ended December 31, 2023 and total long-lived assets by geographic region as of December 31, 2023 appears in Note 6, “Segments,” set forth in Part II, Item 8, “Financial Statements and Supplementary Data,” which is incorporated herein by reference. 4 Intellectual Property We are the owner or licensee of approximately 2,540 U.S. and foreign patents and patent applications, and approximately 2,360 U.S. and foreign trademark registrations and trademark applications that relate to our products, manufacturing processes and equipment.
Our global scale and agility have enabled us to address the evolving customer needs across our end markets and geographies and position us to capitalize on growth opportunities in markets around the world.
Our global scale and agility have enabled us to address the evolving customer needs across our end markets and geographies and position us to capitalize on growth opportunities in markets around the world. We operate through our subsidiaries and have a presence in the U.S. and 45 other countries/territories listed below.
In addition, we provide temperature assurance packaging solutions under the Kevothermal™ and TempGuard™ brands. Protective solutions are sold through a strategic network of distributors as well as directly to end customers, including, but not limited to, fabricators, original equipment manufacturers, contract manufacturers, logistics partners and e-commerce/fulfillment operations. In 2022, approximately 50% of our Protective sales were sold through distributors.
Protective solutions are sold through a strategic network of distributors as well as directly to end customers, including, but not limited to, fabricators, original equipment manufacturers, contract manufacturers, logistics partners and e-commerce/fulfillment operations. In 2023, approximately 50% of our Protective sales were sold through distributors. We generally do not impose annual minimum purchase volume requirements on our distributors.
In 2022, we experienced slightly higher net sales in the first half as compared to the second half of the year due to supply disruptions, recessionary pressures and the impact of foreign currency translation.
In 2023, we experienced slightly higher net sales in the second half of the year as compared to the first half which was partially due to the impact of foreign currency translation and the timing of the Liquibox acquisition.
Consideration exchanged for Liquibox was $1.15 billion in cash, subject to customary adjustments. Competitive Strengths Our growth strategy leverages our competitive strengths in high-performance packaging solutions, well-established customer relationships, iconic brands, and global scale and market access. High-performance Packaging Solutions.
Competitive Strengths Our growth strategy leverages our competitive strengths in high-performance packaging solutions, well-established customer relationships, iconic brands, and global scale and market access. High-performance Packaging Solutions.
These factors could lead to increased prices for our raw materials, curtailment of supplies, allocation of raw materials and other force majeure events by our suppliers.
These factors could lead to increased prices for our raw materials, curtailment of supplies, allocation of raw materials and other force majeure events by our suppliers. We have a centralized supply chain organization, which includes centralized management of purchasing and logistic activities.
Additionally, we provide access to multiple customized trainings that educate employees on the safe execution of their jobs in an environmentally responsible manner. All operations are required to implement the relevant elements of our EHS Management System. Implementation of EHS standards and guidelines takes place at the plant/office level and is assessed through a periodic review process.
Additionally, we provide a training program with access to multiple customized training courses that educate our employees on the safe execution of their jobs in an environmentally responsible manner. All operations are required to implement the relevant elements of our EHS Management System.
We look to create long-term relationships with leaders in the markets we serve. We leverage extensive knowledge of our customers’ businesses when innovating new solutions, and partner with customers to effectively implement our solutions and automate their operations.
We have a broad and diversified customer base which includes the world’s leading food processors, e-commerce/fulfillment companies and industrial manufacturers. We seek to create long-term relationships with leaders in the markets we serve. We leverage extensive knowledge of our customers’ businesses when innovating new solutions, and partner with customers to effectively implement our solutions and automate their operations.
Health and Safety As a company with manufacturing operations across the world, protecting the health, safety and well-being of our people is a top priority. We have a goal of zero harm and we intentionally manage our operations to provide employees with a safe and healthy working environment.
Health and Safety As a company with manufacturing operations across the world, protecting the health, safety and well-being of our people is a top priority.
We generally do not impose annual minimum purchase volume requirements on our distributors. Product returns from our distributors in 2022 were not material. Sales to governments, or government contracts, are not material to our Protective segment. No single customer or affiliated group of customers represented more than 10% of segment revenue in 2022.
Product returns from our distributors in 2023 were not material. Sales to governments, or government contracts, are not material to our Protective segment. No single customer or affiliated group of customers represented more than 10% of segment revenue in 2023. There are other manufacturers of products similar to those produced by Protective.
We believe that some of our direct competition within the protective packaging industry has a less diversified global presence. We believe that a focus on materials circularity, sustainability, and automation and equipment offerings will continue to define the direction of the competitive landscape into the future for both segments.
A focus on materials circularity, sustainability, and automation and equipment offerings will continue to define the direction of the competitive landscape into the future for both segments.
Additionally, the Company sponsors leadership programs designed to impact the effectiveness across multiple levels of management from front line supervisors to executive leaders. Reportable Segments We report our segment information in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 280, “Segment Reporting,” (“FASB ASC Topic 280”).
Reportable Segments We report our segment information in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 280, “Segment Reporting,” (“FASB ASC Topic 280”).
SEE's management regularly reports and discusses our workforce and people management strategies and related matters with our Board of Directors and the Organization and Compensation Committee (“O&C Committee”) of the Board of Directors, including matters related to compensation, succession planning, corporate culture, employee engagement, and DEI.
SEE's management regularly reports and discusses our workforce and people management strategies and related matters with our Board of Directors and the People and Compensation Committee (formerly the Organization and Compensation Committee), or "P&C Committee", of the Board of Directors, including matters related to compensation, succession planning, corporate culture, employee engagement, and diversity, equity and inclusion (“DEI”). 5 As of December 31, 2023, our employee population was approximately 17,000 people.
This training includes required and monitored course training for employees in specific roles based on associated risk and function. Required sessions include the Code of Conduct, anti-bribery, anti-corruption, conflicts of interest, and workplace respect, among other legal and compliance subject matters. 8 SEE Culture At SEE, we are cultivating a caring, high-performance growth culture guided by our purpose.
Employees receive regular online education as part of enhanced global ethics and compliance programs. This training includes required and monitored course training for employees in specific roles based on associated risk and function. Required sessions include the Code of Conduct, anti-bribery, anti-corruption, conflicts of interest, and workplace respect, among other legal and compliance subject matters.
Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional discussion of our 2022 results. Compliance with Government Regulations As a manufacturer, we are subject to various laws, rules and regulations in the countries/territories, jurisdictions and localities in which we operate.
Compliance with Government Regulations As a manufacturer, we are subject to various laws, rules and regulations in the countries/territories, jurisdictions and localities in which we operate.
Our product breadth combined with our global scale and reach helps support our customers' needs for sustainability, performance excellence, consistency and reliability of supply wherever they operate around the world.
With automated equipment, high-performance materials, and services, our solutions are designed to increase our customers' packaging velocity, minimize packaging waste, reduce labor dependencies and address dimensional weight challenges. Our product breadth combined with our global scale and reach helps support our customers' needs for sustainability, performance excellence, consistency and reliability of supply wherever they operate around the world.
Our Code of Conduct guides us in how to manage our daily processes and interactions with professionalism, respect and integrity. Employees attest annually to reviewing and adhering to the Code of Conduct. Employees receive regular online education as part of enhanced global ethics and compliance programs.
It encourages all employees to promote an ethical culture and to recognize and report integrity and compliance issues. Our Code of Conduct guides us in how to manage our daily processes and interactions with professionalism, respect, and integrity. Employees attest annually to reviewing and adhering to the Code of Conduct.
SEE maintains an Environmental, Health and Safety (EHS) policy which outlines the Company’s commitment to integrate EHS principles in all aspects of the business including products, operations, and supply chain.
We have a goal of zero-harm and we intentionally manage our operations to provide employees with a safe and healthy working environment. 6 We maintain an Environmental, Health and Safety ("EHS") policy which outlines the Company’s commitment to integrate EHS principles in all aspects of the business including products, operations, and supply chain.
In 2022, we generated net sales of $5.6 billion, net earnings from continuing operations of $491 million, and net cash provided by operating activities of $613 million. Please refer to Part II, Item 8, “Financial Statements and Supplementary Data” for financial information about the Company and its subsidiaries, which is incorporated herein by reference.
Please refer to Part II, Item 8, “Financial Statements and Supplementary Data” for financial information about the Company and its subsidiaries, which is incorporated herein by reference.
As of December 31, 2022, we had approximately 6,900 employees in the U.S. and approximately 9,400 employees outside the U.S. Our workforce is relatively stable and does not have significant seasonal fluctuations. We had approximately 105 U.S. employees and 4,920 non-U.S. employees who were covered by collective bargaining agreements as of December 31, 2022.
As of December 31, 2023, we had approximately 7,200 employees in the U.S. and approximately 9,800 employees outside the U.S. Our workforce is relatively stable and does not experience significant seasonal fluctuations.
There are other manufacturers of products similar to those produced by Food, some that operate across multiple regions and others that operate in a single region or single country. Competing manufacturers produce a wide variety of food packaging based on plastic, metals and other materials.
No single customer or affiliated group of customers represented more than 10% of segment revenue in 2023. There are other manufacturers of products similar to those produced by Food, some that operate across multiple regions and others that operate in a single region or single country.
Our portfolio of solutions includes leading brands such as CRYOVAC ® brand food packaging, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated packaging, BUBBLE WRAP ® brand packaging, SEE Automation™ solutions and prismiq™ digital packaging and printing solutions.
Our portfolio of solutions includes leading brands such as CRYOVAC ® brand food packaging, LIQUIBOX ® brand liquids systems, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated packaging systems and BUBBLE WRAP ® brand packaging. We have two reportable segments, Food and Protective. Liquibox is included in our Food reporting segment.
Additionally, some of our Food and Protective competitors have been consolidating in recent years or have been involved in significant merger and acquisition activity, and we believe this trend may continue.
Additionally, some of our Food and Protective competitors have been consolidating in recent years or have been involved in significant merger and acquisition activity, and this trend may continue. 8 Raw Materials and Purchasing Suppliers provide raw materials, packaging components, contract manufactured goods, equipment and other direct materials, such as inks, films and paper.
We prioritize our people and the experience they have being part of SEE as we recognize the importance they play in realizing our purpose, shaping a caring, high-performance organization and culture, and delivering world-class experiences and opportunities for our customers and other stakeholders. Our purpose-driven, high-performance culture is focused on driving operational excellence.
We recognize the important roles our people play in realizing our purpose; shaping a caring, high-performance organization and culture; and delivering world-class packaging solutions, experiences and opportunities for our customers and stakeholders.
Many of the covered employees are represented by works councils or industrial boards, as is customary in the jurisdictions in which they are employed. The collective bargaining agreements covering approximately 47% of such employees will expire during 2023 and we will be engaged in negotiations to attain new agreements.
We had approximately 5,000 employees (close to 30% of total employee population and primarily outside the U.S.) who were covered by collective bargaining agreements as of December 31, 2023. Many of the covered employees are represented by works councils or industrial boards, as is customary in the jurisdictions in which they are employed.
Meeting our net-zero carbon dioxide emissions pledge will require significant capital investment in our operations. We also may invest in renewable energy credits, carbon offsets, or similar programs to aid in reaching our goals, the cost of which were not material in the year ended December 31, 2022, but may be so in future years. Solving Customer Challenges.
Meeting our net-zero carbon dioxide emissions pledge will require significant capital investment in our operations. We also may invest in renewable energy solutions, energy conservation measures, carbon offsets, or similar programs to reach our goals.
Food applications are largely sold direct to customers by our sales, marketing and customer service personnel throughout the world. Sales to governments, or government contracts, are not material to our Food segment. No single customer or affiliated group of customers represented more than 10% of segment revenue in 2022.
Our solutions, which include high-performance materials, equipment, and services, are designed to extend shelf life and enhance food safety. Food applications are largely sold direct to customers by our sales, marketing and customer service personnel throughout the world. Sales to governments, or government contracts, are not material to our Food segment.
Our packaging solutions are designed to help customers automate their operations to be increasingly touchless and more resilient, safer, less wasteful, and enhance brand engagement with consumers. We deliver our packaging solutions to an array of end markets including fresh proteins, foods, fluids and liquids, medical and life science, e-commerce retail, logistics and omnichannel fulfillment operations, and industrials.
We deliver our packaging solutions to an array of end markets including fresh proteins, foods, fluids and liquids, medical and life science, e-commerce retail, logistics and omnichannel fulfillment operations, and industrials. In February 2023, we acquired Liquibox and expanded our product offerings to liquid packaging and dispensing solutions for food, beverage, consumer goods and industrial end markets.
We operate based on mutual trust and encourage diverse thinking to achieve a common objective. We think without limits to solve customer, company and societal challenges. As of December 31, 2022, our employee population was approximately 16,300 people. The largest component of SEE's workforce is approximately 10,200 direct manufacturing employees in our manufacturing facilities.
We operate based on mutual trust and encourage diverse thinking to achieve a common objective. We think without limits to solve customer, company and societal challenges. The Company maintains a written Code of Conduct which reflects our purpose and values as an organization and how we should act.
Protective Protective packaging solutions are utilized across many global markets to protect goods during transit and are especially valuable to e-commerce, consumer goods, pharmaceutical and medical devices and industrial manufacturing. With automated 10 equipment, high-performance materials, and services, our solutions are designed to increase our customers' packaging velocity, minimize packaging waste, reduce labor dependencies and address dimensional weight challenges.
Competing manufacturers produce a wide variety of food packaging based on plastic, metals and other materials. Protective Protective packaging solutions are utilized across many global markets to protect goods during transit and are especially valuable to e-commerce, consumer goods, pharmaceutical and medical devices and industrial manufacturing.
Identified inequities are mitigated to close the gaps and compensation processes are evaluated for unintended bias and continuously improved to prevent future adverse impact. Recruiting, Retaining and Engaging Employees and Learning and Development We believe that our success depends on our ability to attract, recruit, and retain employees with the desired expertise and talent.
Identified inequities are mitigated to close the gaps, and compensation processes are evaluated for unintended bias and continuously improved to prevent future adverse impact. Voice of the Workforce During 2023, we conducted a global employee belonging survey, reaffirming our commitment to listening, learning, and implementing improvements to enhance our workplace environment.
Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional discussion of the impact of 2022 supply chain disruptions and raw material price increases. Some materials used to manufacture our packaging products are sourced from recycled content from our operations or are obtained through our participation in recycling programs.
However, in some regions we rely on some sole-source suppliers, and we seek to mitigate the associated risks through our global inventory and supply agreements. Some materials used to manufacture our packaging products are sourced from recycled content from our operations or are obtained through our participation in recycling programs.
Purpose driven capital allocation to create value to our shareholders and society. Our capital allocation strategy fuels the SEE Operating Engine and is rooted in economic value add with the goal to drive profitable, above market organic growth, and attractive returns on invested capital. We invest through capital expenditures, research and development spend, acquisitions, and investments aligned with our strategy.
Our strategy is enabled by our balanced capital allocation approach that is designed to maximize value for our shareholders with the goal to deliver above-market profitable organic growth and attractive returns on invested capital while strengthening our balance sheet through the repayment of debt.
Our consolidated results of operations trended directionally the same as our net sales seasonality with slightly higher results of operations in the first half of the year. The impact of raw material price changes and related pricing actions have also impacted the timing of when our total net sales and our consolidated results of operations were earned throughout 2022.
Our consolidated results of operations trended directionally the same as our net sales seasonality with slightly higher results of operations in the second half of the year. Refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional discussion of our 2023 results.
We have policies in place which guide the Company in environmental, health and safety matters including training, materials conservation, communications, targets and transparency. 12 Additionally, some of SEE's materials or products are subject to a tax on certain plastics or plastic components, which went into effect in 2022 in jurisdictions such as the United Kingdom (UK) and the U.S.
We have policies in place which guide the Company in environmental, health and safety matters including training, materials conservation, communications, targets and transparency. Certain U.S. states have passed laws for Extended Producer Responsibility ("EPR"). EPR laws also exist in many other countries where we do business including the EU and Canada.
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We serve customers across 120 countries/territories directly and through a diversified distribution network. We aim to deliver savings to our customers and accelerate payback on their investments. We invest in technology and innovation that we believe will transform our industry toward a more sustainable future.
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Refer to “Reportable Segments” below for additional information. In 2023, we generated net sales of $5.5 billion, net earnings from continuing operations of $339 million, and net cash provided by operating activities of $516 million.
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We have two reportable segments, Food and Protective. Refer to “Reportable Segments” below for additional information. Vision and Strategy Our Vision To become a world-class company partnering with our customers on automation, digital and sustainability packaging solutions Our strategy is focused on creating a customer packaging experience by advancing packaging solutions integrating SEE Automation, Digital, and Sustainability.
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Our Vision To become a world-class sustainable automated packaging solutions provider, partnering with our customers to solve their most critical food and protective packaging needs Our strategy focuses on creating long-term, value-added partnerships with our customers to advance sustainable, automated and digital packaging solutions, leveraging our industry-leading expertise in materials, automation systems, engineering and technologies.
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SEE caring high-performance people + digital culture . We are bringing people together with a future that is more digitally connected. We prioritize our people and recognize the importance they play in realizing our vision and purpose.
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CTO2Grow: Accelerating growth by relentless focus on productivity and cost efficiency The cost take-out to grow program (“CTO2Grow Program”) was launched in 2023 and targets annualized savings of $140 to $160 million by the end of 2025.
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Through digital platforms, we are accelerating our efforts to retain, attract and motivate top talent, train our leadership teams, develop future leaders, shape a caring, high-performance organization and culture, and drive top benchmark employee engagement. Creating SEE Touchless Automation™ experience .
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The CTO2Grow Program seeks to improve the effectiveness and efficiency of our solutions-focused go-to-market organization, optimize our portfolio with a focus on automation, digital and sustainable solutions, streamline our supply chain footprint and drive selling, general and administrative (“SG&A”) productivity.
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With our SEE Automation™ solutions, we aim to solve our customers’ automation needs while creating significant return on their investments through savings and increased productivity. We have focused on increasing our equipment offerings which help our customers automate packaging processes.
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Our CTO2Grow program focuses on: • SEE Operational Excellence and cost reduction initiatives: Increasing focus on world-class operations, zero-harm, flawless quality, on-time delivery, network optimization, and productivity improvements. • Accelerate growth: Streamlining our commercial organization to improve commercial effectiveness and growth outlook by allocating resources closer to our customers within our distinct Food and Protective end markets.
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In addition, through our SEE Operating Engine, we are automating our own operations to make them more sustainable and generate productivity savings. Lead the industry with Digital transformation. Our MySEE digital e-commerce platform is making doing business with SEE easier and more efficient.
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Continuing to lead with automation and provide our customers with a single point of contact for both materials and equipment. 3 • Portfolio optimization efforts: Aligning our portfolio of products with our longer-term strategy to develop sustainable, automated, digital packaging solutions that drive above market growth.
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We are investing in automation and digital technologies that enhance performance, efficiency and monitoring in customers’ and our own operations. During 2022, we introduced prismiq™, a digital packaging brand with a portfolio of solutions for design services, digital printing and connected packaging. Our digital packaging can enable 3 traceability and deliver digital content.
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For non-core portfolios, determining the best path forward to unlock value. • Innovate and advance sustainability: Leveraging the voice of our customers and market insights to accelerate the development of sustainable and automated packaging solutions that meet our rapidly evolving end market needs.
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We continue to invest in digital printing to drive customer savings, generate demand and enhance brand image and shelf impact. Sustainability is core to our business . Sustainability is embedded in our purpose and vision. We have set ambitious environmental goals aimed to lead the industry towards a better future.
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As we progress in the CTO2Grow Program, we are looking to leverage the voice of our customers and market insights to accelerate the development of sustainable and automated packaging solutions that meet our rapidly evolving end market needs. Sustainability Sustainability is embedded in our business strategy.
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We are designing high-performance packaging materials with recyclability in mind, to make sustainability more affordable, and to create a pathway for a circular economy. We are transforming our operations and our customers’ operations with SEE Touchless Automation ™ which enhances sustainability by improving efficiency, eliminating waste, simplifying processes, and creating a safer working environment.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

67 edited+26 added−20 removed109 unchanged
Biggest changeIf we lose significant sales volume or reduce selling prices significantly, there could be a negative impact on our consolidated financial condition, results of operations, profitability or cash flows. Also, reduced availability of credit may adversely affect the ability of some of our customers and suppliers to obtain funds for operations and capital expenditures.
Biggest changeDuring economic downturns or recessions, there can be a heightened competition for sales and increased pressure to reduce selling prices as our customers may reduce their volume of purchases from us. If we lose significant sales volume or reduce selling prices significantly, there could be a negative impact on our consolidated financial condition, results of operations, profitability or cash flows.
Significant price increases could impact our earnings depending on, among other factors, the pricing by competitors of similar products and the response by the customers to higher prices. Such price increases may result in lower volume of sales and a subsequent decrease in gross margin and adversely impact our results of operations.
Significant price increases could impact our earnings depending on, among other factors, the pricing by competitors of similar products and the response by customers to higher prices. Such price increases may result in lower sales volume and a subsequent decrease in gross margin and adversely impact our results of operations.
Our inability to effectively manage the negative impacts of changing U.S. and foreign trade policies could materially adversely impact our consolidated financial condition, results of operations, or cash flows. The U.S.
Our inability to effectively manage the negative impacts of changing U.S. and foreign trade policies could materially adversely impact our consolidated financial condition, results of operations, or cash flows.
The credit agreement governing the senior secured credit facilities, the indentures that govern our senior notes and the agreements covering our accounts receivable securitization programs restrict our ability to dispose of assets and use the proceeds from those dispositions and may also restrict our ability to raise debt or equity capital to be used to repay other indebtedness when it becomes due.
The credit agreement governing our senior secured credit facilities, the indentures that govern our senior notes and the agreements covering our accounts receivable securitization programs restrict our ability to dispose of assets and use the proceeds from those dispositions and may also restrict our ability to raise debt or equity capital to be used to repay other indebtedness when it becomes due.
Our tax expense and liabilities are affected by a number of factors, such as changes in our business operations, acquisitions, investments, entry into new businesses and geographies, intercompany transactions, the relative amount of our foreign earnings, losses incurred in jurisdictions for which we are not able to realize related tax benefits, the applicability of special or extraterritorial tax regimes, changes in foreign currency exchange rates, the level of interest expense we incur, changes in our stock price, changes to our forecasts of income and loss and the mix of jurisdictions to which they relate, and changes in our tax assets and liabilities and their valuation.
Our tax expense and liabilities are affected by a number of factors, such as changes in our business operations, acquisitions, investments, entry into new businesses and geographies, intercompany transactions, the relative amount of our foreign earnings, losses incurred in jurisdictions for which we are not able to realize related tax benefits, the applicability of special or extraterritorial tax regimes, changes in foreign currency exchange rates, the level of interest expense we incur, changes in our 22 stock price, changes to our forecasts of income and loss and the mix of jurisdictions to which they relate, and changes in our tax assets and liabilities and their valuation.
If a significant liability claim is brought against us that is not adequately covered by insurance, we may have to pay the claim with our own funds, which could have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows. Item 1B. Unresolved Staff Comments None. 25
If a significant liability claim is brought against us that is not adequately covered by insurance, we may have to pay the claim with our own funds, which could have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows. Item 1B. Unresolved Staff Comments None.
New products may not meet sales or margin expectations due to many factors, including our inability to (i) accurately predict demand, end-user preferences and evolving industry and regulatory standards; (ii) resolve technical and technological challenges in a timely and cost-effective manner; or (iii) achieve manufacturing efficiencies.
New products may not meet sales or margin expectations due to many factors, including our inability to 15 (i) accurately predict demand, end-user preferences and evolving industry and regulatory standards; (ii) resolve technical and technological challenges in a timely and cost-effective manner; or (iii) achieve manufacturing efficiencies.
In particular, we depend on our information technology infrastructure for fulfilling and invoicing customer orders, applying cash receipts, and placing purchase orders with suppliers, making cash disbursements, and conducting digital marketing activities, data processing and electronic communications among business locations. We also depend on telecommunication systems for communications between company personnel and our customers and suppliers.
In particular, we depend on our information technology infrastructure for fulfilling and invoicing customer orders, applying cash receipts, and placing purchase orders with suppliers, making cash disbursements, and conducting marketing activities, data processing and electronic communications among business locations. We also depend on telecommunication systems for communications between company personnel and our customers and suppliers.
Foreign exchange rates can also impact the competitiveness of products produced in certain jurisdictions and exported for sale into other jurisdictions. These changes may impact the value received for the sale of our goods versus those of our competitors. The Company cannot predict the effects of exchange rate fluctuations on its future operating results.
Foreign exchange rates can also impact the competitiveness of products produced in certain jurisdictions and exported for sale into other jurisdictions. These changes may impact the value 20 received for the sale of our goods versus those of our competitors. The Company cannot predict the effects of exchange rate fluctuations on its future operating results.
Any failure to obtain, maintain or comply with the terms of these permits could result in fines or penalties, revocation or nonrenewal of our permits, or orders to cease certain operations, and may have a material adverse effect on our business, financial condition, results of operations, or cash flows.
Any failure to obtain, maintain or comply with the terms of these permits could result in fines or penalties, revocation or nonrenewal of our 18 permits, or orders to cease certain operations, and may have a material adverse effect on our business, financial condition, results of operations, or cash flows.
Additionally, if our credit ratings were to be downgraded, particularly our Corporate Rating, there could be a negative impact on our ability to access capital markets and borrowing costs could increase. 24 Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
Additionally, if our credit ratings were to be downgraded, particularly our corporate rating, there could be a negative impact on our ability to access capital markets and borrowing costs could increase. Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
We rely on third-party logistics suppliers for the distribution and transportation of raw materials, operating supplies and products. Delays, fluctuations in freight costs, limitations on shipping and receiving capacity, and other disruptions in the transportation and shipping infrastructure may adversely impact our ability to manufacture and distribute products.
We rely on third-party logistics suppliers for the distribution and transportation of raw materials, components, operating supplies and products. Delays, fluctuations in freight costs, limitations on shipping and receiving capacity, and other disruptions in the transportation and shipping infrastructure may adversely impact our ability to manufacture and distribute products.
We may be unable to successfully pass along these costs through price increases; adjust our supply chain without incurring significant costs; or locate alternative suppliers for raw materials or finished goods at acceptable costs or in a timely manner.
We may be unable to successfully pass along these costs through price increases; adjust our supply chain without incurring significant costs; or locate alternative suppliers for raw materials or finished goods at acceptable costs 19 or in a timely manner.
The indentures governing our senior notes, the credit agreement governing our senior secured credit facilities and our accounts receivable securitization programs contain a number of restrictive covenants that impose significant operating and financial restrictions on us and may limit our ability to engage in acts that may be in our long-term best interest, including restrictions on our ability to: • incur additional indebtedness; • pay dividends or make other distributions or repurchase or redeem capital stock; • prepay, redeem or repurchase certain debt; • make loans and investments; • sell assets; • incur liens; • enter into transactions with affiliates; • alter the businesses we conduct; • enter into agreements restricting our subsidiaries’ ability to pay dividends; and • consolidate, merge or sell all or substantially all of our assets.
Our senior secured credit facilities, our accounts receivable securitization programs and our senior notes indentures contain a number of restrictive covenants that impose significant operating and financial restrictions on us and may limit our ability to engage in acts that may be in our long-term best interest, including restrictions on our ability to: 21 • incur additional indebtedness; • pay dividends or make other distributions or repurchase or redeem capital stock; • prepay, redeem or repurchase certain debt; • make loans and investments; • sell assets; • incur liens; • enter into transactions with affiliates; • alter the businesses we conduct; • enter into agreements restricting our subsidiaries’ ability to pay dividends; and • consolidate, merge or sell all or substantially all of our assets.
While we have a geographically diverse international presence and are situated in close proximity to many significant customers, continued supply chain disruptions related to the transport of raw materials and/or finished goods could adversely affect our business, consolidated financial condition, results of operations, or cash flows.
While we have a geographically diverse international presence and are situated in close proximity to many significant customers, future supply chain disruptions related to the transport of raw materials and/or finished goods could adversely affect our business, consolidated financial condition, results of operations, or cash flows.
The terms of our credit agreement governing our senior secured credit facilities, our accounts receivable securitization programs, our supply chain financing programs, and the indentures governing our senior notes may restrict our current and future operations, particularly our ability to respond to changes in market conditions or to take certain actions.
The terms of our senior secured credit facilities, our accounts receivable securitization programs, our supply chain financing programs, and our senior notes indentures may restrict our current and future operations, particularly our ability to respond to changes in market conditions or to take certain actions.
As exchange rates vary, the Company's results of operations and profitability may be adversely impacted. While we use financial instruments to hedge certain foreign currency exposures, this does not insulate us completely from foreign currency effects and exposes us to counterparty credit risk for non-performance. See Note 15, “Derivatives and Hedging Activities,” of the Notes.
As exchange rates vary, the Company's results of operations and profitability may be adversely impacted. While we use financial instruments to hedge certain foreign currency exposures, this does not insulate us completely from foreign currency effects and exposes us to counterparty credit risk for non-performance. See Note 15, “Derivatives and Hedging Activities,” for additional information.
In addition, the restrictive covenants in the credit agreement governing our senior credit facilities require us to maintain a specified net leverage ratio. Our ability to meet this financial ratio can be affected by events beyond our control.
In addition, the restrictive covenants in our senior credit facilities require us to maintain a specified net leverage ratio. Our ability to meet this financial ratio can be affected by events beyond our control.
While we have experienced, and expect to continue to experience, attacks attempting to breach the security of our network and systems, none have resulted in a breach with material impact or any penalties or settlement for the three years ended December 31, 2022.
While we have experienced, and expect to continue to experience, occasional attacks attempting to breach the security of our network and systems, none have resulted in a breach with material impact or any penalties or settlement for the three years ended December 31, 2023.
The indenture governing certain of our senior notes and 23 the credit agreement governing the senior secured credit facilities limit the ability of certain of our subsidiaries to incur consensual restrictions on their ability to pay dividends or make other intercompany payments to us. These limitations are subject to qualifications and exceptions.
The indentures governing certain of our senior notes and the credit agreement governing the senior secured credit facilities limit the ability of certain of our subsidiaries to incur consensual restrictions on their ability to pay dividends or make other intercompany payments to us. These limitations are subject to qualifications and exceptions.
In addition, an event of default under the credit agreement governing our senior secured credit facilities would permit the lenders under our senior secured credit facilities to terminate all commitments to extend further credit under those facilities.
In addition, an event of default under our senior secured credit facilities would permit the lenders under our senior secured credit facilities to terminate all commitments to extend further credit under those facilities.
Innovation, particularly related to our automation, sustainability and digital offerings, is key to our strategy. Our performance and prospects for future growth could be adversely affected if new products do not meet sales or margin expectations and we are not able to meet our innovation rate goals. Our customers' preferences continue to trend towards sustainable and automated packaging solutions.
Innovation, particularly related to our sustainability offerings, is key to our strategy. Our performance and prospects for future growth could be adversely affected if new products do not meet sales or margin expectations and we are not able to meet our innovation goals. Our customers' preferences continue to trend towards sustainable packaging solutions.
The extent to which our operations may be impacted by the COVID-19 pandemic in the future will depend largely on continued developments, which are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning the severity of the outbreak, including new variants of the virus, and actions by government authorities to contain the outbreak or treat its impact, including the effectiveness and distribution of vaccines.
The extent to which our operations may be impacted in the future by health epidemics, pandemics and other outbreaks, including the COVID-19 pandemic, will depend largely on continued developments, which are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning the severity of the outbreak, including new variants of the virus, and actions by government authorities to contain the outbreak or treat its impact, including the effectiveness and distribution of vaccines.
Financial Risks Fluctuations between foreign currencies and the U.S. dollar could materially impact our consolidated financial condition or results of operations. 22 Approximately 46% of our net sales in 2022 were generated outside the U.S. We translate sales and other results denominated in foreign currency into U.S. dollars for our Consolidated Financial Statements.
Financial Risks Fluctuations between foreign currencies and the U.S. dollar could materially impact our consolidated financial condition or results of operations. Approximately 47% of our net sales in 2023 were generated outside the U.S. We translate sales and other results denominated in foreign currency into U.S. dollars for our Consolidated Financial Statements.
We operate in 46 countries/territories, and our products are distributed in 120 countries/territories around the world. A large portion of our manufacturing operations are located outside of the U.S. and 46% of our net sales are generated outside of the U.S.
We operate in 46 countries/territories, and our products are distributed in 115 countries/territories around the world. A large portion of our manufacturing operations are located outside of the U.S., and in 2023, 47% of our net sales were generated outside of the U.S.
The COVID-19 pandemic has and may result in future supply chain and operational disruptions such as the availability and transportation of raw materials or the ability for our packaging and equipment specialists to visit customer facilities. Unpredictable disruptions to the Company’s operations or our customers’ operations could reduce our future revenues and negatively impact the Company’s financial condition.
These health events had and may result in future supply chain and operational disruptions such as the availability and transportation of raw materials or the ability for our packaging and equipment specialists to visit customer facilities. Unpredictable disruptions to the Company’s operations or our customers’ operations could reduce our future revenues and negatively impact the Company’s financial condition.
As of December 31, 2022, we had $508 million of long-term borrowings under our senior secured credit facilities at variable interest rates. A 1/8% increase or decrease in the assumed interest rates on the senior secured credit facilities would result in a $0.6 million increase or decrease in annual interest expense.
As of December 31, 2023, we had $1,058 million of long-term borrowings under our senior secured credit facilities at variable interest rates. A 1/8% increase or decrease in the assumed interest rates on the senior secured credit facilities would result in a $1.3 million increase or decrease in annual interest expense.
Despite our efforts to protect such sensitive, confidential or personal data or information, our facilities and systems and those of our customers and third-party service providers may be vulnerable to security breaches, theft, misplaced or lost data, programming and/or human errors that could lead to the compromising of sensitive, confidential or personal data or information, improper use of our systems, software solutions or networks, unauthorized access, use, disclosure, modification or destruction of information, defective products, production downtimes and operational disruptions, which in turn could adversely affect our business, consolidated financial condition, results of operations, or cash flows. 18 The regulatory environment surrounding cybersecurity and data privacy is increasingly demanding, with new and changing regulations.
Despite our continued efforts to protect such sensitive, confidential or personal data or information, our facilities and systems and those of our customers and third-party service providers may be vulnerable to security breaches, theft, misplaced or lost data, programming and/or human errors that could lead to the compromising of sensitive, confidential or personal data or information, improper use of our systems, software solutions or networks, unauthorized access, use, disclosure, modification or destruction of information, defective products, production downtimes and operational disruptions, which in turn could adversely affect our business, consolidated financial condition, results of operations, or cash flows.
As countries progress towards long-term environmental stewardship goals, we expect laws and tax policy to continue to advance. SEE has processes in place and internal goals related to operating efficiency in matters such as greenhouse gas emissions, energy usage, and water consumption.
As countries progress towards long-term environmental stewardship goals, we expect laws and tax policy to continue to advance in this regard. We have established processes and internal goals related to operating efficiency in matters such as greenhouse gas emissions, energy usage, and water consumption.
Increased compliance costs, increasing risks and penalties associated with violations, or our inability to market some of our products in certain jurisdictions may have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows.
Increased compliance costs, increasing risks and penalties associated with violations, or our inability to market some of our products in certain jurisdictions may have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows. We are subject to taxation and tax audits or investigations in multiple jurisdictions.
Litigation, in general, and securities, derivative actions and class action litigation, in particular, can be expensive and disruptive. Some of these proceedings may involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years.
We are involved from time to time in various legal proceedings. Litigation, in general, and securities, derivative actions and class action litigation, in particular, can be expensive and disruptive. Some of these proceedings may involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years.
Uncertain global economic conditions, including the impact of inflationary pressure and general economic slowdowns across the global economy, may have an adverse impact on our business in the form of lower volumes sold due to weakened demand, unfavorable changes in product price/mix, or lower profit margins.
Uncertain global economic conditions may have an adverse effect on our consolidated financial condition, results of operations, or cash flows. 11 Uncertain global economic conditions, including the impact of inflationary pressure and general economic slowdowns across the global economy, may have an adverse impact on our business in the form of lower volumes sold due to weakened demand, unfavorable changes in product price/mix, or lower profit margins.
We are subject to taxation and tax controversies in multiple jurisdictions. As a result, any adverse development in the tax laws of any of these jurisdictions or any disagreement by the tax authorities with our tax positions could have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows.
As a result, any adverse development in the tax laws of any of these jurisdictions or any disagreement by the tax authorities with our tax positions could have a material adverse effect on our business, consolidated financial condition, results of operations, or cash flows.
The prices for these raw materials are cyclical and increases in market demand or fluctuations in the global trade for petrochemical-based raw materials and energy could increase our costs, such as those experienced during 2022.
The prices for these raw materials are cyclical and increases in market demand or fluctuations in the global trade for petrochemical-based raw materials and energy could increase our costs.
In addition, economic and market volatility due to the COVID-19 pandemic may negatively impact consumer buying habits, which could adversely affect the Company’s financial results.
In addition, economic and market volatility due to pandemics and other outbreaks may negatively impact consumer buying habits, which could adversely affect the Company’s financial results.
Their experience and industry contacts significantly benefit us, and we need their expertise to execute our business strategies, including our strategies related to automation, digital and sustainability.
Their experience and industry contacts significantly benefit us, and we need their expertise to execute our business strategies.
A shortage in the labor pool and other general inflationary pressures or changes, the results of our labor negotiations and changes to applicable laws and regulations could increase labor costs, or cause a disruption in operations, which could materially adversely affect our business.
A shortage in the labor pool and other general inflationary pressures or changes, the results of our labor negotiations and changes to applicable laws and regulations could increase labor costs, or cause a disruption in operations, which could materially adversely affect our business. 17 Legal, Regulatory and Compliance Risks Regulations on recycling or environmental sustainability could adversely impact our business.
We and some of our customers have experienced in the past, and could face in the future, facility shutdowns or reductions in operations due to the pandemic and the adverse impact to staffing levels in our operations.
We and some of our customers have experienced in the past, and could 14 face in the future, facility shutdowns or reductions in operations due to pandemics or other health events and adverse impacts to staffing levels in our operations.
As a result of acquisitions, including the Liquibox acquisition, we may record a significant amount of goodwill and other identifiable intangible assets and we may never realize the full carrying value of the related assets. As a result of acquisitions, we may record a significant amount of goodwill and other identifiable intangible assets, including customer relationships, trademarks and developed technologies.
As a result of past acquisitions, including the Liquibox acquisition, we have recorded a significant amount of goodwill and other identifiable intangible assets and we may never realize the full carrying value of the related assets.
Unfavorable customer responses to price increases could have a material adverse impact on our sales and earnings. From time to time, and especially in periods of rising raw material costs, we increase the prices of our products. For example, throughout 2022, the Company enacted pricing actions, which included price increases across our portfolio.
Unfavorable customer responses to price increases could have a material adverse impact on our sales and earnings. From time to time, and especially in periods of rising raw material costs, we increase the prices of our products.
Geopolitical events, including the ongoing conflict between Russia and Ukraine, may have a negative impact on the global industrial macro-economic environment and could materially adversely impact our consolidated financial condition, results of operations, or cash flows. 16 If we are not able to protect our trade secrets or maintain our trademarks, patents and other intellectual property, we may not be able to prevent competitors from developing similar products or from marketing their products in a manner that capitalizes on our trademarks, and this loss of a competitive advantage may adversely impact our business, consolidated financial condition, results of operations, or cash flows.
If we are not able to protect our trade secrets or maintain our trademarks, patents and other intellectual property, we may not be able to prevent competitors from developing similar products or from marketing their products in a manner that capitalizes on our trademarks, and this loss of a competitive advantage may adversely impact our business, consolidated financial condition, results of operations, or cash flows.
Furthermore, if we were unable to repay the amounts due and payable under our senior secured credit facilities, those lenders could proceed against the collateral granted to them to secure that indebtedness. In the event our lenders or note holders accelerate the repayment of our borrowings, we and our subsidiaries may not have sufficient assets to repay that indebtedness.
Furthermore, if we were unable to repay the amounts due and payable under our senior secured credit facilities or our senior secured notes, those lenders or note holders could proceed against the collateral granted to them to secure that indebtedness.
In addition, geopolitical tensions and instability may heighten our risk to cybersecurity incidents. To mitigate these threats to our business, we maintain a cybersecurity program aligned with industry frameworks designed to protect, detect, and respond to internal and external threats.
In addition, geopolitical tensions and instability may heighten our risk of cybersecurity incidents. To mitigate these threats to our business, we maintain a cybersecurity program aligned with industry frameworks designed to protect, detect, and respond to internal and external threats. For additional discussion of our cybersecurity risk management, strategy, and governance, see Part I, Item 1C., "Cybersecurity," below.
Supply chain disruptions related to the transport of raw materials and/or finished goods may delay the timing of when we are able to manufacture our product or serve our customers, which could adversely affect our business, consolidated financial condition, results of operations, or cash flows.
If any such employee were to cease working for us and we were unable to replace them, our business, consolidated financial condition, results of operations, or cash flows may be materially adversely affected. 16 Supply chain disruptions related to the transport of raw materials, components and/or finished goods may delay the timing of when we are able to manufacture our product or serve our customers, which could adversely affect our business, consolidated financial condition, results of operations, or cash flows.
We are subject to an increasing number of information technology vulnerabilities, threats and targeted computer crimes which pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of our data.
We, like other global companies, are subject to an increasing number of cybersecurity threats which pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of our data.
The tax authorities in any applicable jurisdiction, including the U.S., may disagree with the positions we have taken or intend to take regarding the tax treatment or characterization of any of our transactions.
We are also subject to tax audits or investigations in various jurisdictions that can result in assessments against us and the tax authorities in any applicable jurisdiction, including the U.S., may disagree with the positions we have taken or intend to take regarding the tax treatment or characterization of any of our transactions.
The COVID-19 pandemic could adversely impact the health and safety of our employees, our business continuity, consolidated financial condition, results of operations, or cash flows. 14 The COVID-19 pandemic and the related containment and mitigation measures that have been put into place across the globe, have had and may continue to have adverse impact on the global economy and our business.
Health epidemics, pandemics and other outbreaks could adversely impact the health and safety of our employees, our business continuity, consolidated financial condition, results of operations, or cash flows. Health epidemics, pandemics and other outbreaks, such as the COVID-19 pandemic, have had and may continue to have adverse impact on the global economy and our business.
Legal, Regulatory and Compliance Risks We are the subject of various legal proceedings, and may be subject to future claims and litigation, that could have a material adverse effect on our business, results of operations or cash flows. We are involved from time to time in various legal proceedings.
There is no guarantee these internal goals will be as comprehensive as future legislation in the jurisdictions in which we operate. We are the subject of various legal proceedings, and may be subject to future claims and litigation, that could have a material adverse effect on our business, results of operations or cash flows.
Such a default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies.
A breach of the covenants under our senior notes indentures or under our senior secured credit facilities could result in an event of default under the applicable indebtedness. Such a default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies.
There are various jurisdictions in which we operate which are actively considering changes to existing tax laws, that, if enacted, could increase our tax obligations in countries where we do business. Additional changes in tax laws could increase our overall taxes and our business, consolidated financial condition or results of operations could be adversely affected in a material way.
There are various jurisdictions in which we operate which are actively considering changes to existing tax laws, that, if enacted, could increase our tax obligations in countries where we do business.
We could be required to expend additional resources to comply with any such regulations, and failure to comply could subject us to significant penalties or claims.
The regulatory environment surrounding cybersecurity and data privacy is increasingly demanding, with new and changing regulations. We could be required to expend additional resources, which could be material, to comply with any such regulations, and failure to comply could subject us to significant penalties or claims.
Additionally, in Europe and Latin America, the majority of our employees are represented by either labor unions or workers' councils and are covered by collective bargaining agreements that are generally renewable on an annual basis.
The labor market in many geographic regions, including the U.S., is becoming increasingly competitive. Higher turnover may lead to reductions in operational efficiencies. Additionally, in Europe and Latin America, many of our employees are represented by either labor unions or workers' councils and are covered by collective bargaining agreements that are generally renewable on an annual basis.
This could negatively impact our ability to obtain necessary supplies as well as our sales of materials and equipment to affected customers. This could also result in reduced or delayed collections of outstanding accounts receivable. We experience competition in the markets for our products and services and in the geographic areas in which we operate .
Also, reduced availability of credit may adversely affect the ability of some of our customers and suppliers to obtain funds for operations and capital expenditures. This could negatively impact our ability to obtain necessary supplies as well as our sales of materials and equipment to affected customers. This could also result in reduced or delayed collections of outstanding accounts receivable.
These factors may lead to reduced sales of food packaging products, which could have a material adverse effect on our consolidated financial condition, results of operations, or cash flows.
These factors may lead to reduced sales of food packaging products, which could have a material adverse effect on our consolidated financial condition, results of operations, or cash flows. We could experience disruptions in operations and/or increased labor costs. We depend on the skills, working relationships, and continued services of employees, including our direct manufacturing employees.
Our reliance on some sole-source suppliers, and/or the lack of availability of supplies, including equipment components, could have a material adverse effect on our consolidated financial condition, results of operations, or cash flows. 17 Natural disasters, such as a hurricane, tornado, earthquake or other severe weather event, as well as political instability and terrorist activities, may negatively impact the production or delivery capabilities of refineries and natural gas and petrochemical suppliers and suppliers of other raw materials in the future.
Natural disasters, such as a hurricane, tornado, earthquake or other severe weather event, as well as political instability and terrorist activities, may negatively impact the production or delivery capabilities of refineries and natural gas and petrochemical suppliers and suppliers of other raw materials in the future.
Product liability claims or regulatory actions could adversely affect our financial results or harm our reputation or the value of our brands. Claims for losses or injuries purportedly caused by some of our products arise in the ordinary course of our business.
Claims for losses or injuries purportedly caused by some of our products arise in the ordinary course of our business.
Environmental laws have become more stringent and complex over time. Our environmental costs and operating expenses will be subject to evolving regulatory requirements and will depend on the scope and timing of the effectiveness of requirements in these various jurisdictions.
Our environmental costs and operating expenses will be subject to evolving regulatory requirements and will depend on the scope and timing of the effectiveness of requirements in various jurisdictions. As a result of such requirements, we may be subject to an increased regulatory burden.
Additionally, we may not successfully implement our pricing actions. These factors may have an adverse impact on our consolidated financial condition, results of operations, or cash flows.
Additionally, we may not successfully implement our pricing actions. These factors may have an adverse impact on our consolidated financial condition, results of operations, or cash flows. Acquisitions present many risks, and we may not achieve the financial and strategic goals that were contemplated at the time of a transaction. We review and consider strategic acquisitions from time to time.
Although we maintain legal liability insurance coverage, potential litigation claims could be excluded or exceed coverage limits under the terms of our insurance policies or could result in increased costs for such coverage. Our operations are subject to a variety of environmental and other laws that expose us to regulatory scrutiny, potential financial liability and increased operating costs.
Although we maintain legal liability insurance coverage, potential litigation claims could be excluded or exceed coverage limits under the terms of our insurance policies or could result in increased costs for such coverage. Product liability claims or regulatory actions could adversely affect our financial results or harm our reputation or the value of our brands.
As of December 31, 2022, less than 2% of our consolidated net sales were derived from products sold in Russia and less than 1% of consolidated net sales were derived from products sold in Ukraine.
For the year ended December 31, 2023, approximately 1% of our consolidated net sales were derived from products sold in Russia.
We are also subject to tax controversies in various jurisdictions that can result in assessments against us. Developments in an audit, investigation, or other tax controversy can have a material effect on our operating results or cash flows in the period or periods in which that development occurs.
Successful challenge by the tax authorities of the tax treatment or characterization of any of our transactions, or developments in an audit, investigation, or other tax dispute can have a material effect on our operating results or cash flows in the period or periods in which that development occurs.
Our packaging products and equipment solution offerings compete with similar products made by other manufacturers and with a number of other types of materials or products. We compete on the basis of performance characteristics of our products, as well as service, price, sustainability and innovations in technology. A number of competing domestic and foreign companies are well-established.
We compete on the basis of performance characteristics of our products, as well as service, price, sustainability and innovations in technology. A number of competing domestic and foreign companies are well-established. Customers in the e-commerce and food service industry and peers in the packaging industry have been consolidating in recent years, which may continue in the future.
Our competitive advantage is due in part to our ability to develop and introduce new and sustainable products in a timely manner at favorable margins. The development and introduction cycle of new products can be lengthy and involve high levels of investment.
Our success is dependent on continued innovation in sustainability and our ability to bring new products to market in an efficient manner. Our competitive advantage is due in part to our ability to develop and introduce new and sustainable products in a timely manner at favorable margins.
If any applicable tax authorities, including U.S. 21 tax authorities, were to successfully challenge the tax treatment or characterization of any of our transactions, it could have a material adverse effect on our business, consolidated financial condition, results of our operations, or cash flows.
The occurrence of any of these risks could have a material adverse effect on our business, results of operations, financial condition or cash flows, particularly in the case of a larger acquisition.
Uncertain global economic conditions may have an adverse effect on our consolidated financial condition, results of operations, or cash flows.
Changes in our organization as a result of executive management transition may have a disruptive impact on our ability to implement our strategy and could have a material adverse effect on our consolidated financial condition, results of operations, or cash flows.
There is no guarantee that we will be able to recover the impact of plastic taxes from our customers. We maintain programs designed to comply with laws and regulations and to monitor their evolution. 20 We cannot predict with reasonable certainty the future cost to us of environmental compliance, product registration, or environmental remediation.
We cannot predict with reasonable certainty the future cost to us of environmental compliance, product registration, or other regulatory requirements. Environmental laws and other regulatory requirements have become more stringent and complex over time.
The matter has been submitted to the IRS Independent Office of Appeals for review of the proposed disallowance. An unfavorable resolution of this matter could have a material adverse effect on our consolidated financial condition and results of operations, or cash flows. See Note 20, "Commitments and Contingencies," for further details.
Our reliance on some sole-source suppliers, and/or the lack of availability of supplies, including equipment components, could have a material adverse effect on our consolidated financial condition, results of operations, or cash flows.
Removed
Additionally, in 2022, widespread inflationary pressures were experienced across global economies, resulting in higher costs for our raw materials, non-material cost components and labor. During economic downturns or recessions, there can be a heightened competition for sales and increased pressure to reduce selling prices as our customers may reduce their volume of purchases from us.
Added
Our production levels and inventory management goals for our products are based on estimates of demand, taking into account production capacity, timing of shipments and inventory levels.
Removed
Customers in the e-commerce and food service industry and peers in the packaging industry have been consolidating in recent years, and we believe this trend may continue.
Added
If market conditions change, resulting in us overestimating or underestimating demand for any of our products during a given season, we may not maintain appropriate inventory levels, which could materially and adversely affect our business, financial condition and results of operation.
Removed
Concerns about the impact that some plastic materials may have on the environment, along with changes in legal or regulatory requirements, development of recycling infrastructure, consumer preferences or market measures to address these concerns, may negatively affect our business and operations. Public attention to plastic waste and its associated or perceived environmental impact continues to receive attention.
Added
We experience competition in the markets for our products and services and in the geographic areas in which we operate . Our packaging products and equipment solution offerings compete with similar products made by other manufacturers and with a number of other types of materials or products.
Removed
Some jurisdictions have laws and regulations that govern the registration, labeling and taxation or surcharges of some of our products. 15 For example, some of our materials or products became subject to a tax on certain plastics, which went into effect in 2022 in the UK and the U.S. and is expected to go into effect in other European countries in 2023.
Added
Any acquisitions we may undertake, including the Liquibox acquisition, and their integration involves risks and uncertainties, such as: • our ongoing business may be disrupted and our management’s attention may be diverted by acquisition, transition or integration activities; • we may have difficulties (1) managing an acquired company’s technologies or lines of business; (2) entering new markets where we have no, or limited, direct prior experience or where competitors may have stronger market positions; or (3) retaining key personnel from the acquired companies; • an acquisition may not further our business strategy as we expected, we may not integrate an acquired company or technology as successfully as we expected, we may impose our business practices or alter go-to-market strategies that adversely impact the acquired business or we may overpay for, or otherwise not realize the expected return on our investments, each or all of which could adversely affect our business or operating results and potentially cause impairment to assets that we recorded as a part of an acquisition, including intangible assets and goodwill; • our operating results or financial condition may be adversely impacted by (1) claims or liabilities that we assume from an acquired company or technology or that are otherwise related to an acquisition; (2) pre-existing contractual relationships that we assume from an acquired company, the termination or modification of which may be costly or disruptive to our business; and (3) unfavorable revenue recognition or other accounting treatment as a result of an acquired company’s business practices; 12 • we may not realize any anticipated increase in our revenues from an acquisition for a number of reasons, including (1) if a larger than predicted number of customers decline to renew or terminate their contracts with the acquired company; (2) if we are unable to sell the acquired products or service offerings to our customer base; (3) if acquired customers do not elect to purchase our technologies due to differing business practices; or (4) if contract models utilized by an acquired company do not allow us to recognize revenues in a manner that is consistent with our current accounting practices; • we may encounter deficiencies in internal controls at the acquired business, as well as when implementing our own management information systems, operating systems and internal controls for the acquired operations; • our due diligence process may fail to identify significant issues with the acquired business’ products, financial disclosures, accounting practices, legal, tax and other contingencies, compliance with local laws and regulations (and interpretations thereof) in the U.S. and multiple international jurisdictions; • additional acquisition-related debt could increase our leverage and potentially negatively affect our credit ratings resulting in more restrictive borrowing terms or increased borrowing costs thereby limiting our ability to borrow; and • inaccuracies in our original estimates and assumptions used to assess a transaction, which may result in us not realizing the expected financial or strategic benefits of any such transaction.
Removed
Consumer perceptions, preferences and buying behaviors may change as a result of public attention to plastic waste and current and future regulations. Currently, single-use plastic bans and/or proposals have focused on specific items such as grocery bags, cutlery, beverage straws and stir sticks, expanded polystyrene or oxo-degradable plastic.
Added
As a result of past acquisitions, we have recorded a significant amount of goodwill and other identifiable intangible assets, including customer relationships, trademarks and developed technologies.
Removed
At present, all of the products we manufacture are in compliance with applicable laws and regulations, but there can be no assurances regarding future laws and regulations. We maintain programs designed to comply with laws and regulations and to monitor their evolution.
Added
Geopolitical events, including the ongoing conflict between Russia and Ukraine, the existing or potential increased hostilities in the Middle East and the increasing tensions between China and Taiwan, may have a negative impact on the global industrial macro-economic environment and could materially adversely impact our consolidated financial condition, results of operations, or cash flows.
Removed
We also continue to innovate our packaging solutions to exceed recyclability or reusability requirements, address cube optimization to eliminate non-recyclable plastic waste, and increase the use of recycled and/or renewable materials. We believe that execution of our strategy positions us to exceed sustainability and recyclability demands of our customers with innovative solutions and new formulations of our materials.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table shows our manufacturing facilities by geographic region and our business segment reporting structure: Properties by Geographic Region Number of Manufacturing Facilities Food Manufacturing Facilities Protective Manufacturing Facilities Americas 41 11 34 Europe, Middle East and Africa ("EMEA") 28 11 23 Asia, Australia and New Zealand ("APAC") 28 9 24 Total 97 31 81 Other Property Information We own the large majority of our manufacturing facilities.
Biggest changeThe following table shows our manufacturing facilities by geographic region and our business segment reporting structure: Properties by Geographic Region Number of Manufacturing Facilities Food Manufacturing Facilities Protective Manufacturing Facilities Americas 46 18 32 Europe, Middle East and Africa ("EMEA") 28 15 19 Asia, Australia and New Zealand ("APAC") 31 11 25 Total 105 44 76 Other Property Information We own the large majority of our manufacturing facilities.
For a list of those countries and territories outside of the U.S. where we have operations, see Global Scale and Market Access within “Competitive Strengths” in Item 1. We believe that our manufacturing, warehouse, office and other facilities are well maintained, suitable for their purposes and adequate for our needs. 26
For a list of those countries and territories outside of the U.S. where we have operations, see Global Scale and Market Access within “Competitive Strengths” in Part I, Item 1, "Business." We believe that our manufacturing, warehouse, office and other facilities are well maintained, suitable for their purposes and adequate for our needs. 26
Item 2. Properties We manufacture products in 97 facilities, with 15 of those facilities serving both of our reportable segments.
Item 2. Properties We manufacture products in 105 facilities, with 15 of those facilities serving both of our reportable segments.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe are also involved in various other legal actions incidental to our business. We believe, after consulting with counsel, that the disposition of these other legal proceedings and matters will not have a material effect on our consolidated financial condition or results of operations including potential impact to cash flows. 27
Biggest changeTo the best of our knowledge, after consulting with counsel, the disposition of these other legal proceedings and matters will not have a material effect on our consolidated financial condition or results of operations including potential impact to cash flows. 27
Item 3. Legal Proceedings The information set forth in Note 20, “Commitments and Contingencies,” under the captions “Settlement Agreement Tax Deduction,” “Securities Class Action” and “Environmental Matters” is incorporated herein by reference. The Company has received litigation demand letters from purported stockholders of the Company.
Item 3. Legal Proceedings The information set forth in Note 20, “Commitments and Contingencies,” of Part II, Item 8, “Financial Statements and Supplemental Data,” under the captions “Settlement Agreement Tax Deduction,” “Securities Class Action” and “Environmental Matters” is incorporated herein by reference. The Company has received litigation demand letters from purported stockholders of the Company.
The letters either demand that the Company file suit against certain current and former directors and officers or indicate that the Company file suit against Ernst & Young, several of its current or former partners and the Company’s former CFO, William Stiehl, as applicable. The Board of Directors is taking appropriate steps to consider these matters.
The letters either demand that the Company file suit against certain current and former directors and officers or indicate that the Company file suit against Ernst & Young, several of its current or former partners and the Company’s former CFO, William Stiehl, as applicable.
Added
The Board of Directors considered and addressed the litigation demands, and to the best of our knowledge, the matters have been resolved as of January 2024. We are also involved in various other legal actions incidental to our business.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeHe joined the Company in 2010 and had served as Senior Vice President, Chief Transformation and Manufacturing/Supply Chain Officer since 2019. Mr. Chammas 29 leads the global procurement and manufacturing organizations with a focus on SEE Operational Excellence across the Company.
Biggest changeChammas leads the global procurement and manufacturing organizations with a focus on SEE Operational Excellence across the Company. He also served as Chief Transformation Officer, reflecting his company-wide leadership of the Reinvent SEE business transformation. From 2010 to 2019, Mr. Chammas served as Senior Vice President and Chief Supply Chain Officer. Prior to joining the Company, Mr.
Grasso started his career at Cargill, one of the top producers and distributors of agricultural products and spent 18 years at the company ultimately serving in several management and leadership positions in the food, agriculture and beverage businesses. Mr. Wichmann was named President of the Europe, Middle East and Africa ("EMEA") region of the Company in 2020.
Mr. Grasso started his career at Cargill, one of the top producers and distributors of agricultural products and spent 18 years at the company ultimately serving in several management and leadership positions in the food, agriculture and beverage businesses. 29 Mr. Wichmann was named President of the Europe, Middle East and Africa ("EMEA") region of the Company in 2020.
Mine Safety Disclosures Not applicable. 28 Information About Our Executive Officers The information appearing in the table below sets forth the current position or positions held by each of our executive officers, the officer’s age as of January 31, 2023, the year in which the officer was first elected to the position currently held with us and the year in which such person was first elected an officer.
Mine Safety Disclosures Not applicable. 28 Information About Our Executive Officers The information appearing in the table below sets forth the current position or positions held by each of our executive officers, the officer’s age as of January 31, 2024, the year in which the officer was first elected to the position currently held with us and the year in which such person was first elected an officer.
Faccin joined Sealed Air in 2013 as Vice President, Financial Planning & Analysis, and has held various leadership positions throughout her career with the company. She was Vice President and Treasurer from 2015 to 2017 and again most recently in 2021, where she was responsible for all treasury functions including access to capital markets and capital allocation strategy.
Faccin joined the Company in 2013 as Vice President, Financial Planning & Analysis, and has held various leadership positions throughout her career with the Company. She was Vice President and Treasurer from 2015 to 2017 and again most recently in 2021, where she was responsible for all treasury functions including access to capital markets and capital allocation strategy.
From 2018 to 2020, she led the Protective Packaging business in North America as Vice President and General Manager, where she headed the Company’s integration of the acquisition of Automated Packaging Systems. Prior to joining Sealed Air, she held various finance roles at The Dow Chemical Company from 2009 to 2012 and at Rohm and Haas from 1999 to 2009.
From 2018 to 2020, she led the Protective Packaging business in North America as Vice President and General Manager, where she headed the Company’s integration of the acquisition of Automated Packaging Systems. Prior to joining the Company, she held various finance roles at The Dow Chemical Company from 2009 to 2012 and at Rohm and Haas from 1999 to 2009.
He was appointed as an executive officer of the Company in 2022. In his current role, he is responsible for business and commercial strategy implementation and the EMEA results for our Food and Protective segments. Mr. Wichmann joined Sealed Air in 1994, starting his career with Cryovac as an application engineer.
He was appointed as an executive officer of the Company in 2022. In his current role, he is responsible for business and commercial strategy implementation and the EMEA results for our Food and Protective segments. Mr. Wichmann joined the Company in 1994, starting his career with Cryovac as an application engineer.
Ms. Willis joined the Company in 2019 as Vice President, General Counsel and Secretary. She was appointed as an executive officer of the Company in 2020. Prior to joining Sealed Air, Ms. Willis served as Vice President & Deputy General Counsel at Ingersoll Rand.
Ms. Willis joined the Company in 2019 as Vice President, General Counsel and Secretary. She was appointed as an executive officer of the Company in 2020. Prior to joining the Company, Ms. Willis served as Vice President & Deputy General Counsel at Ingersoll Rand.
She joined Sealed Air in 2014 as Americas Finance Director for the Protective business, and has held various leadership positions throughout her career with the Company including Global Finance Director for Food, Vice President of the Global Commercial Finance team and Vice President of Corporate Financial Planning and Analysis.
She joined the Company in 2014 as Americas Finance Director for the Protective business, and has held various leadership positions throughout her career with the Company including Global Finance Director for Food, Vice President of the Global Commercial Finance team and Vice President of Corporate Financial Planning and Analysis. Prior to joining the Company, Ms.
Company, a confectionery company, from 2008 through 2010, and served in management positions of increasing responsibility in supply chain, operations and procurement with the Wm. Wrigley Jr. Company from 2002 through 2008. Mr. Pupkin was promoted to Senior Vice President, Chief Growth & Strategy Officer in 2021.
Chammas was Vice President, Worldwide Supply Chain, for the Wm. Wrigley Jr. Company, a confectionery company, from 2008 through 2010, and served in management positions of increasing responsibility in supply chain, operations and procurement with the Wm. Wrigley Jr. Company from 2002 through 2008. Mr.
Thomsen served as a Partner at McKinsey & Company from 2006 to 2022, where he focused on driving growth and digital transformation for private equity-owned and publicly listed companies in North America, Europe 30 and Asia. Before this, he worked in the finance and investment sector where he spent time at an investment bank in Scandinavia. Ms.
Prior to joining the Company, Mr. Thomsen served as a Partner at McKinsey & Company, where he worked from 2006 to 2022, where he focused on driving growth and digital transformation for private equity-owned and publicly listed companies in North America, Europe and Asia.
All of our officers serve at the pleasure of the Board of Directors. There are no family relationships among any of our executive officers or directors. Name and Current Position Age as of January 31, 2023 First Elected to Current Position First Elected an Executive Officer Edward L. Doheny II President and Chief Executive Officer 60 2018 2017 Christopher J.
All of our officers serve at the pleasure of the Board of Directors. There are no family relationships among any of our executive officers or directors. Name and Current Position Age as of January 31, 2024 First Elected to Current Position First Elected an Executive Officer Emile Z.
Prior to joining Sealed Air, Susan held various finance roles for the Dow Chemical Company from 2009 to 2014 and Rohm & Haas Company from 2001 to 2009. Mr. Leon was appointed as Chief Accounting Officer and Controller in 2018. He was appointed as an executive officer of the Company in 2018.
Yang held various finance roles at the Dow Chemical Company from 2009 to 2014 and Rohm & Haas Company from 2001 to 2009. Ms. Johnson was appointed as Chief Accounting Officer and Controller in 2023. She was appointed as an executive officer of the Company in 2023.
Prior to joining Sealed Air, Tobias served as President of Mosaic Brazil for The Mosaic Company from 2005 to 2015, a leading integrated producer and marketer of concentrated phosphate and potash. Mr.
Grasso began his career at Sealed Air in 2015 and managed the Company’s food packaging business as Vice President of Latin America and then President of North America. Prior to joining the Company, Mr. Grasso served as President of Mosaic Brazil for The Mosaic Company from 2005 to 2015, a leading integrated producer and marketer of concentrated phosphate and potash.
In his current role, he is responsible for business and commercial strategy implementation and the Americas results for our Food and Protective segments. Mr. Grasso began his career at Sealed Air in 2015 and managed the company’s food packaging business as Vice President of Latin America and then President of North America.
He was appointed as an executive officer of the Company in 2022. In his current role, he is responsible for business and commercial strategy implementation and the Americas results for our Food and Protective segments. Mr.
Yang was named Vice President, SEE Automation Finance Leader and Treasurer of the Company in 2022. She was appointed as an executive officer of the Company in 2022. In her current role, she is responsible for all treasury functions and provides financial leadership for SEE's equipment and automation business.
In her current role, she is responsible for all treasury functions, investor relations and enterprise risk management. In addition, she provides financial leadership for SEE's equipment and automation business.
President, Americas 59 2021 2022 Gerd Wichmann President, Europe, Middle East and Africa 54 2020 2022 Alessandra Faccin Assis President, Asia Pacific 44 2022 2022 Angel S. Willis Vice President, General Counsel & Secretary 52 2019 2020 Jannick C.
Chammas Interim Co-President and Co-Chief Executive Officer, and Chief Operating Officer 55 2023 2010 Dustin J. Semach Interim Co-President and Co-Chief Executive Officer, and Chief Financial Officer 42 2023 2023 Tobias Grasso, Jr. President, Americas 60 2021 2022 Gerd Wichmann President, Europe, Middle East and Africa 55 2020 2022 Alessandra Faccin Assis President, Asia Pacific 45 2022 2022 Angel S.
Removed
Stephens, Jr. (1) Senior Vice President, Chief Financial Officer 58 2021 2021 Emile Z. Chammas Senior Vice President, Chief Operating Officer 54 2022 2010 Sergio A. Pupkin Senior Vice President, Chief Growth & Strategy Officer 57 2021 2020 Tobias Grasso, Jr.
Added
Willis Vice President, General Counsel & Secretary 53 2019 2020 Jannick C. Thomsen Vice President, Chief People and Digital Officer 41 2022 2022 Shuxian (Susan) Yang Vice President, Treasurer, Investor Relations, and Strategic Growth Finance 52 2022 2022 Veronika Johnson Chief Accounting Officer and Controller 41 2023 2023 Mr.
Removed
Thomsen Vice President, Chief People and Digital Officer 40 2022 2022 Shuxian (Susan) Yang Vice President, Treasurer and SEE Automation Finance Leader 51 2022 2022 Michael A. Leon Chief Accounting Officer and Controller 42 2018 2018 (1) In October 2022, Mr. Stephens announced his intention to retire as Senior Vice President, Chief Financial Officer. It is expected that Mr.
Added
Chammas was named Interim Co-President and Co-Chief Executive Officer, and Chief Operating Officer in October 2023. Mr. Chammas was previously appointed as Senior Vice President and Chief Operating Officer in 2022. He joined the Company in 2010 and had served as Senior Vice President, Chief Transformation and Manufacturing/Supply Chain Officer since 2019. Mr.
Removed
Stephens will continue in his current role until a successor is appointed. Mr. Doheny joined the Company as Chief Operating Officer and CEO-Designate in September 2017 and was elected a Director of Sealed Air Corporation. He became President and CEO effective January 1, 2018. Prior to joining the Company in September 2017, Mr.
Added
Semach was named Interim Co-President and Co-Chief Executive Officer, and Chief Financial Officer in October 2023. Mr. Semach initially joined the Company as Chief Financial Officer-Designate effective April 17, 2023, and became Chief Financial Officer in May 2023. Prior to joining the Company, Mr.
Removed
Doheny served as President and Chief Executive Officer and a Director of Joy Global Inc., a manufacturer and servicer of high productivity mining equipment, from 2013 through 2017. Mr.
Added
Semach served as Chief Financial Officer of TTEC Holdings, Inc., a global customer experience technology and services provider (“TTEC”), from November 2021 to April 2023, after joining TTEC, in December 2020 as part of its planned Chief Financial Officer succession. Prior to joining TTEC, Mr.
Removed
Doheny also served as Executive Vice President of Joy Global and President and Chief Operating Officer of its Underground Mining Machinery business from 2006 to 2013, where he had global responsibility for the company's underground mining machinery business. Prior to joining Joy Global, Mr.
Added
Semach served as Chief Financial Officer at Rackspace Technology, Inc., a global cloud services provider, from July 2019 to November 2020, and prior to that he held various key leadership roles at DXC Technology Company, an information technology services company, from January 2013 to July 2019. Mr. Grasso was named President of the Americas region of the Company in 2021.
Removed
Doheny had a 21-year career with Ingersoll Rand Corporation holding a series of senior executive positions of increasing responsibility, including President of Industrial Technologies from 2003 to 2005 and President of the Air Solutions Group from 2000 to 2003. Mr.
Added
Before this, he worked in the finance and investment sector where he spent time at an investment bank in Scandinavia. Ms. Yang was named Vice President, Treasurer, Investor Relations and Strategic Growth Finance in 2022. She was appointed as an executive officer of the Company in 2022.
Removed
Stephens joined the Company as Senior Vice President and Chief Financial Officer-Designate effective January 1, 2021 and became the Chief Financial Officer on February 26, 2021. Previously, he had served as Senior Vice President, Finance and Chief Financial Officer, of Barnes Group Inc. since January 2009.
Added
Since 2018, she served as the Company’s Vice President, Global Business Services, responsible for record-to-report, order-to-cash and procure-to-pay transaction processing across the globe. Prior to that, she served in various accounting leadership positions since joining the Company in 2015. Prior to joining the Company, Ms. Johnson spent over eight years in public accounting in roles of increasing responsibility. Ms.
Removed
Barnes Group Inc. is a global provider of engineered products, technologies and solutions to a range of industries including aerospace, transportation, manufacturing, automation and packaging. Prior his role at Barnes Group, Mr.
Added
Johnson is a Certified Public Accountant. 30 PART II
Removed
Stephens held key leadership roles at Honeywell International, serving as President of the Consumer Products Group from 2007 to 2008, and Vice President and Chief Financial Officer of Honeywell Transportation Systems from 2003 to 2007.
Removed
Prior to Honeywell, he held roles with increasing responsibility at The Boeing Company, serving as Vice President and General Manager, Boeing Electron Dynamic Devices; Vice President, Business Operations, Boeing Space and Communications; and Vice President and Chief Financial Officer, Boeing Satellite Systems. Mr. Chammas was named Senior Vice President and Chief Operating Officer in 2022.
Removed
He also served as Chief Transformation Officer, reflecting his company-wide leadership of the Reinvent SEE business transformation, and oversees the global IT organization. From 2010 to 2019, Mr. Chammas served as Senior Vice President and Chief Supply Chain Officer. Prior to joining the Company, Mr. Chammas was Vice President, Worldwide Supply Chain, for the Wm. Wrigley Jr.
Removed
He was previously named Vice President and Chief Growth & Strategy Officer and appointed an executive officer of the Company in 2020. In his current role, he is responsible for corporate strategy, global mergers and acquisitions, innovation and development, global marketing, brand communications and our digital business, including e-commerce and SealedAir.com. Prior to his current role, Mr.
Removed
Pupkin became Chief Strategy Officer in 2019 and served as Vice President, Corporate Strategy, Mergers and Acquisitions from 2016 to 2019. From 2011 to 2016 Mr. Pupkin held leadership positions in our former Diversey Care segment and joined Sealed Air in 2011 as a result of the Diversey acquisition. At the time of the acquisition, Mr.
Removed
Pupkin had over 14 years of increasing responsibility in strategic marketing, business development, sales, and general management for Diversey, Inc. and predecessor companies. Mr. Grasso was named President of the Americas region of the Company in 2021. He was appointed as an executive officer of the Company in 2022.
Removed
As part of our transformation to world-class, Mr. Thomsen is leading a digital strategy to enhance our culture and create a world-class employee experience that attracts and retains talent at SEE. Prior to joining the Company, Mr.
Removed
In addition, she manages the Company’s Investor Relations and enterprise risk management.
Removed
Prior to the appointment, he served as the Company’s Assistant Corporate Controller since December 2014. Before joining the Company in 2014, Mr.
Removed
Leon held various accounting and finance positions with increasing levels of responsibilities at a Big 4 public accounting firm and at several diversified global manufacturing companies, including SPX Corporation from 2012 to 2014, and United Technologies Corporation and its predecessor company, Goodrich Corporation, from 2006 to 2012.
Removed
He has extensive financial and accounting experience, including financial reporting, financial planning and analysis, mergers and acquisitions, and internal audit, among others. 31 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Announced Plans or Programs Maximum Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (a) (b) (c) (d) Balance as of September 30, 2022 $ 616,358,188 October 1, 2022 through October 31, 2022 — $ — — 616,358,188 November 1, 2022 through November 30, 2022 — $ — — 616,358,188 December 1, 2022 through December 31, 2022 — $ — — 616,358,188 Total — — $ 616,358,188 (1) On August 2, 2021, the Board of Directors approved a new share repurchase program of $1.0 billion.
Biggest changeIssuer Purchases of Equity Securities The table below sets forth the total number of shares of our common stock, par value $0.10 per share, that we repurchased in each month of the quarter ended December 31, 2023, the average price paid per share and the maximum number of shares that may yet be purchased under our publicly announced plans or programs. 32 Period Total Number of Shares Purchased (1) Average Price Paid Per Share Total Number of Shares Purchased as Part of Announced Plans or Programs Maximum Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (a) (b) (c) (d) Balance as of September 30, 2023 $ 536,509,713 October 1, 2023 through October 31, 2023 — $ — — 536,509,713 November 1, 2023 through November 30, 2023 — $ — — 536,509,713 December 1, 2023 through December 31, 2023 — $ — — 536,509,713 Total — — $ 536,509,713 (1) On August 2, 2021, the Board of Directors approved a new share repurchase program of $1.0 billion.
Total return for each assumed investment assumes the reinvestment of all dividends on December 31 of the year in which the dividends were paid. 32 Recent Sales of Unregistered Securities Not applicable.
Total return for each assumed investment assumes the reinvestment of all dividends on December 31 of the year in which the dividends were paid. 31 Recent Sales of Unregistered Securities Not applicable.
The Peer Group includes Sealed Air and the following companies: AptarGroup, Inc.; Ashland Global Holdings Inc.; Avery Dennison Corporation; Avient Corporation; Axalta Coating Systems Ltd.; Ball Corporation; Berry Global Group, Inc.; Celanese Corporation; Crown Holdings, Inc.; Dover Corporation; Fortive Corporation; Graphic Packaging Holding Company; Packaging Corporation of America; Silgan Holdings Inc.; and Sonoco Products Company. Greif, Inc., H.B.
The Peer Group includes Sealed Air and the following companies: AptarGroup, Inc.; Ashland Global Holdings Inc.; Avery Dennison Corporation; Avient Corporation; Axalta Coating Systems Ltd.; Ball Corporation; Berry Global Group, Inc.; Celanese Corporation; Crown Holdings, Inc.; Dover Corporation; Fortive Corporation; Graphic Packaging Holding Company; Packaging Corporation of America; Silgan Holdings Inc.; and Sonoco Products Company.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders Our common stock is listed on the New York Stock Exchange with the trading symbol SEE. As of February 15, 2023, there were approximately 2,831 holders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders Our common stock is listed on the New York Stock Exchange with the trading symbol SEE. As of February 15, 2024, there were approximately 2,667 holders of record of our common stock.
Common Stock Performance Comparisons The following graph shows, for the five years ended December 31, 2022, the cumulative total return on an investment of $100 assumed to have been made on December 31, 2017 in our common stock.
Common Stock Performance Comparisons The following graph shows, for the five years ended December 31, 2023, the cumulative total return on an investment of $100 assumed to have been made on December 31, 2018 in our common stock.
The Peer Group is consistent with the peer companies used by the Organization and Compensation Committee of our Board of Directors (“O&C Committee”) in connection with certain aspects of our executive compensation programs. The O&C Committee includes companies primarily in the materials sector that are comparable to Sealed Air based on sales, number of employees, and market capitalization.
The Peer Group is consistent with the peer companies used by the P&C Committee in 2023 in connection with certain aspects of our executive compensation programs. The P&C Committee selected Peer Group companies primarily in the materials sector that are comparable to Sealed Air based on sales, number of employees, and market capitalization.
In addition, we have historically withheld shares from awards under our Omnibus Incentive Plan pursuant to the provision thereof that permits tax withholding obligations or other legally required charges to be satisfied by having us withhold shares from an award under that plan. During the three months ended December 31, 2022, no shares were withheld pursuant to this provision. 34
In addition, we have historically withheld shares from awards under our 2014 Omnibus Incentive Plan pursuant to the provision thereof that permits tax withholding obligations or other legally required charges to be satisfied by having us withhold shares from an award under that plan.
From time to time we acquire shares by means of open-market transactions, including through plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as 33 amended, and privately negotiated transactions, including accelerated share repurchase programs, pursuant to our publicly announced program described above.
From time to time we acquire shares by means of open-market transactions, including through plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, and privately negotiated transactions, including accelerated share repurchase programs, or other methods, pursuant to our publicly announced program described above, subject to market or other conditions, covenants in our senior secured credit facility and applicable regulatory requirements.
This program has no expiration and replaced the previous authorization. As of December 31, 2022, there was $616 million remaining under the currently authorized repurchase program.
This program has no expiration and replaced the previous authorization. It does not obligate us to repurchase any specified amount of shares and remains subject to the discretion of the Board of Directors. As of December 31, 2023, there was $537 million remaining under the currently authorized repurchase program.
Removed
Fuller Company and Owens-Illinois, Inc. were removed from the Peer Group compared to 2021 and Dover Corporation and Fortive Corporation were added to better reflect alignment with Sealed Air's overall business strategy and industry, especially the increased focus on automation and digital.
Added
During the three months ended December 31, 2023, no shares were withheld pursuant to this provision. 33 Item 6. [Reserved] 34
Removed
Issuer Purchases of Equity Securities The table below sets forth the total number of shares of our common stock, par value $0.10 per share, that we repurchased in each month of the quarter ended December 31, 2022, the average price paid per share and the maximum number of shares that may yet be purchased under our publicly announced plans or programs.

Item 7. Management's Discussion & Analysis

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

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Biggest changeChanges in Working Capital December 31, (In millions) 2022 2021 Change Working capital (current assets less current liabilities) $ 35.0 $ 62.3 $ (27.3) Current ratio (current assets divided by current liabilities) 1.0 x 1.0 x Quick ratio (current assets, less inventories divided by current liabilities) 0.6 x 0.7 x The $27 million, or 44%, decrease in working capital was primarily due to the following: • increase in other current liabilities of $212 million, primarily due to the reclass of uncertain tax positions to current liabilities as they are expected to be settled in cash within the next year; and • $105 million decrease in cash and cash equivalents.
Biggest changeChanges in Working Capital December 31, (In millions) 2023 2022 Change Working capital (current assets less current liabilities) $ 454.3 $ 35.0 $ 419.3 Current ratio (current assets divided by current liabilities) 1.3 x 1.0 x Quick ratio (current assets, less inventories divided by current liabilities) 0.8 x 0.6 x The $419 million increase in working capital was primarily due to the following: • decrease in current portion of long-term debt of $398 million, primarily due to the repurchase of $426 million 4.500% Senior Notes due September 2023; • decrease in other current liabilities of $230 million, primarily due to decrease in uncertain tax positions related to the settlement of the IRS tax audit; • increase in prepaid expenses and other current assets of $131 million, primarily related to the reclassification of trade receivables that serve as collateral for borrowings in our accounts receivable securitization programs; • decrease in accounts payable of $101 million; and • increase in advances and deposits of $60 million, primarily related to the IRS tax deposit. 58 The increases in working capital were partially offset by: • decrease in trade receivables, net of $150 million, primarily due to the reclassification to prepaid expenses and other current assets related to our accounts receivable securitization programs; • increase in short-term borrowings of $134 million; • decrease in cash and cash equivalents of $110 million; and • decrease in inventories, net of $92 million, due to inventory reduction efforts in 2023, partially offset by inventory acquired in the Liquibox acquisition.
We define free cash flow as cash provided by operating activities less capital expenditures (which is classified as an investing activity). Free cash flow is not defined under U.S. GAAP. Therefore, free cash flow should not be considered a substitute for net income or cash flow data prepared in accordance with U.S.
We define free cash flow as cash provided by operating activities less capital expenditures (which is classified as an investing activity). Free cash flow is not defined under U.S. GAAP. Therefore, free cash flow should not be considered a substitute for net income or cash flow data prepared in accordance with U.S.
The impact of accounts payable on cash flow from operating activities was $278 million unfavorable compared to the prior year, as a result of lower balances due to a higher rate of raw material inflation and higher freight costs in 2021 as compared to 2022, coupled with a reduction in accounts payable balances in the fourth quarter of 2022 due to the moderation of purchasing activities tied to inventory reduction initiatives.
The impact of accounts payable on cash flow from operating activities was $278 million unfavorable compared to the prior year, as a result of lower balances due to a higher rate of raw material inflation 56 and higher freight costs in 2021 as compared to 2022, coupled with a reduction in accounts payable balances in the fourth quarter of 2022 due to the moderation of purchasing activities tied to inventory reduction initiatives.
In calculating our worldwide provision for income taxes, we also evaluate our tax positions for years where the statutes of limitations have not expired. Based on this review, we may establish a liability for additional taxes and interest that could be 65 assessed upon examination by relevant tax authorities.
In calculating our worldwide provision for income taxes, we also evaluate our tax positions for years where the statutes of limitations have not expired. Based on this review, we may establish a liability for additional taxes and interest that could be assessed upon examination by relevant tax authorities.
Actual results may differ from estimates under conditions and circumstances different from those assumed, and any such differences may be material to our Consolidated Financial Statements. 62 We believe the following accounting policies are critical to understanding our consolidated results of operations and affect the more significant judgments and estimates used in the preparation of our Consolidated Financial Statements.
Actual results may differ from estimates under conditions and circumstances different from those assumed, and any such differences may be material to our Consolidated Financial Statements. We believe the following accounting policies are critical to understanding our consolidated results of operations and affect the more significant judgments and estimates used in the preparation of our Consolidated Financial Statements.
Accounts Receivable Factoring Agreements We account for our participation in our customers' supply chain financing arrangements and our trade receivable factoring program in accordance with ASC Topic 860, "Transfers and Servicing" ("ASC Topic 860"), which allows the ownership transfer of accounts receivable to qualify for sale treatment when the appropriate criteria are met.
Accounts Receivable Factoring Agreements We account for our participation in our customers' supply chain financing arrangements and our trade receivable factoring program in accordance with ASC Topic 860, "Transfers and Servicing" ("ASC Topic 860"), which allows the ownership 53 transfer of accounts receivable to qualify for sale treatment when the appropriate criteria are met.
GAAP financial measures, because they incorporate non-cash items of depreciation and amortization, including stock-based compensation, which impact the overall performance and net earnings of our business. Additionally, Adjusted Net Earnings and Adjusted EPS reflect the impact of our Adjusted Tax Rate and interest expense on a net and per share basis.
GAAP financial measures, because they incorporate non-cash items of depreciation and amortization, including share-based compensation, which impact the overall performance and net earnings of our business. Additionally, Adjusted Net Earnings and Adjusted EPS reflect the impact of our Adjusted Tax Rate and interest expense on a net and per share basis.
As such, the Company excludes the balances sold under such programs from Trade receivables, net on the Consolidated Balance Sheets. We recognize 55 cash flow from operating activities at the point the receivables are sold under such programs. See Note 11, “Accounts Receivable Factoring Agreements” for further details.
As such, the Company excludes the balances sold under such programs from Trade receivables, net on the Consolidated Balance Sheets. We recognize cash flow from operating activities at the point the receivables are sold under such programs. See Note 11, “Accounts Receivable Factoring Agreements” for further details.
(2) The tax rate used to calculate the tax impact of Special Items is based on the jurisdiction in which the item was recorded. 39 Organic and Constant Dollar Measures In our “Net Sales by Geographic Region,” “Net Sales by Segment,” and in some of the discussions and tables that follow, we exclude the impact of foreign currency translation when presenting net sales information, which we define as “constant dollar”, and we exclude acquisitions in the first year after closing, divestiture activity from the time of sale, and the impact of foreign currency translation when presenting net sales information, which we define as “organic.” Changes in net sales excluding the impact of foreign currency translation and/or acquisition and divestiture activity are non-U.S.
(2) The tax rate used to calculate the tax impact of Special Items is based on the jurisdiction in which the item was recorded. 38 Organic and Constant Dollar Measures In our “Net Sales by Geographic Region,” “Net Sales by Segment,” and in some of the discussions and tables that follow, we exclude the impact of foreign currency translation when presenting net sales information, which we define as “constant dollar”, and we exclude acquisitions in the first year after closing, divestiture activity from the time of sale, and the impact of foreign currency translation when presenting net sales information, which we define as “organic.” Changes in net sales excluding the impact of foreign currency translation and/or acquisition and divestiture activity are non-U.S.
If the payment of additional taxes and interest ultimately proves unnecessary or less than the amount of the liability, the reversal of the liability would result in tax benefit being recognized in the period when we determine the liability is no longer necessary.
If the payment of additional taxes and interest proves unnecessary or less than the amount of the liability, the reversal of the liability would result in tax benefit being recognized in the period when we determine the liability is no longer necessary.
Historically, the most significant currencies that have impacted the translation of our consolidated financial results are the euro, the Australian dollar, the Mexican peso, the Canadian dollar, the British pound, the Chinese Renminbi, the Brazilian real and the New Zealand dollar.
Historically, the most significant currencies that have impacted the translation of our consolidated financial results are the euro, the Australian dollar, the Mexican peso, the Canadian dollar, the British pound, the Chinese Renminbi, the Brazilian real, the New Zealand dollar and the Argentine peso.
Other Derivative Instruments The information set forth in Note 15, “Derivatives and Hedging Activities,” under the caption “Other Derivative Instruments” is incorporated herein by reference. Foreign Currency Forward Contracts At December 31, 2022, we were party to foreign currency forward contracts, which did not have a significant impact on our liquidity.
Other Derivative Instruments The information set forth in Note 15, “Derivatives and Hedging Activities,” under the caption “Other Derivative Instruments” is incorporated herein by reference. Foreign Currency Forward Contracts At December 31, 2023, we were party to foreign currency forward contracts, which did not have a significant impact on our liquidity.
The total projected benefit obligation of the plan is $8 million. The projected benefit obligation was developed using actuarial assumptions that would be used in a plan termination or buy-out basis. Under a full buy-out, the liabilities are fully transferred to an insurance or annuity provider and SEE would no longer maintain the liability or administrative responsibilities.
The total projected benefit obligation of the plan is $9 million. The projected benefit obligation was developed using actuarial assumptions that would be used in a plan termination or buy-out basis. Under a full buy-out, the liabilities are fully transferred to an insurance or annuity provider and SEE would no longer maintain the liability or administrative responsibilities.
As previously disclosed, the IRS has proposed to disallow for the 2014 taxable year the entirety of the deduction of the approximately $1.49 billion in settlement payments made pursuant to the Settlement agreement (as defined in Note 20, “Commitments and Contingencies”) and the resulting reduction of our U.S. federal tax liability by approximately $525 million.
As previously disclosed, the IRS had proposed to disallow for the 2014 taxable year the entirety of the deduction of the approximately $1.49 billion in settlement payments made pursuant to the Settlement agreement (as defined in Note 20, “Commitments and Contingencies”) and the resulting reduction of our U.S. federal tax liability by approximately $525 million.
A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the rating organization. Each rating should be evaluated independently of any other rating. Outstanding Indebtedness At December 31, 2022 and 2021, our total debt outstanding and our non-U.S.
A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the rating organization. Each rating should be evaluated independently of any other rating. Outstanding Indebtedness At December 31, 2023 and 2022, our total debt outstanding and our non-U.S.
We believe that we have adequately reserved for all probable and estimable environmental exposures. Indemnification obligations 54 We are a party to many contracts containing guarantees and indemnification obligations. These contracts include indemnities in connection with the sale of businesses, primarily related to the sale of Diversey in 2017.
We believe that we have adequately reserved for all probable and estimable environmental exposures. 52 Indemnification Obligations We are a party to many contracts containing guarantees and indemnification obligations. These contracts include indemnities in connection with the sale of businesses, primarily related to the sale of Diversey in 2017.
Liquidity and Capital Resources Principal Sources of Liquidity Our primary sources of cash are the collection of trade receivables generated from the sales of our products and services to our customers and amounts available under our existing lines of credit, including our senior secured credit facility, and our accounts receivable securitization programs.
Liquidity and Capital Resources Principal Sources of Liquidity Our primary sources of cash are the collection of trade receivables generated from the sales of our products and services to our customers and amounts available under our existing lines of credit, including our senior secured credit facility, our accounts receivable securitization programs and access to the capital markets.
Management uses Adjusted EBITDA as one of many measures to assess the performance of the business. Additionally, Adjusted EBITDA is the performance metric used by the Company's chief operating decision maker to evaluate performance of our reportable segments. Adjusted EBITDA is also a metric used to determine performance in the Company's Annual Incentive Plan.
Management uses Adjusted EBITDA as one of many measures to assess the performance of the business. Additionally, Adjusted EBITDA is the performance metric used by the Company's chief operating decision maker to evaluate performance of our reportable segments. Adjusted EBITDA is also a metric used to determine performance under the Company's Annual Incentive Plan.
Refer to the specific table presented later in our Management’s Discussion and Analysis of Financial Condition and Results of Operations under Outstanding Indebtedness for reconciliations of this non-U.S. GAAP financial measure to its most directly comparable U.S. GAAP measure.
Refer to the specific table presented later in our Management’s Discussion and Analysis of Financial Condition and Results of Operations under Outstanding Indebtedness for reconciliation of this non-U.S. GAAP financial measure to its most directly comparable U.S. GAAP measure.
For further discussion about these contracts and other financial instruments, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk.” Recently Issued Statements of Financial Accounting Standards, Accounting Guidance and Disclosure Requirements We are subject to numerous recently issued statements of financial accounting standards, accounting guidance and disclosure requirements.
For further discussion about these contracts and other financial instruments, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk.” 59 Recently Issued Statements of Financial Accounting Standards, Accounting Guidance and Disclosure Requirements We are subject to recently issued statements of financial accounting standards, accounting guidance and disclosure requirements.
If these programs had not been in effect for the year ended December 31, 2022, we would have been required to collect the invoice amounts directly from the relevant customers in accordance with the agreed payment terms.
If these programs had not been in effect for the year ended December 31, 2023, we would have been required to collect the invoice amounts directly from the relevant customers in accordance with the agreed payment terms.
The critical accounting policies discussed below should be read together with our significant accounting policies set forth in Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards”. Commitments and Contingencies — Litigation On an ongoing basis, we assess the potential liabilities and costs related to any lawsuits or claims brought against us.
The critical accounting policies discussed below should be read together with our significant accounting policies set forth in Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards.” Commitments and Contingencies — Litigation On an ongoing basis, we assess the potential liabilities and costs related to any lawsuits or claims brought against us.
Gain on Sale of Discontinued Operations, net of tax Gain on sale of discontinued operations, net of tax for the years ended December 31, 2022, 2021 and 2020 were as follows: Year Ended December 31, (In millions) 2022 2021 2020 Gain on sale of discontinued operations, net of tax $ 0.3 $ 15.6 $ 18.8 On March 25, 2017, we entered into a definitive agreement to sell our Diversey Care division and the food hygiene and cleaning business within our Food Care division (collectively, "Diversey") for gross proceeds of $3.2 billion.
Gain on Sale of Discontinued Operations, net of tax Gain on sale of discontinued operations, net of tax for the years ended December 31, 2023, 2022 and 2021 were as follows: Year Ended December 31, (In millions) 2023 2022 2021 Gain on sale of discontinued operations, net of tax $ 2.3 $ 0.3 $ 15.6 On March 25, 2017, we entered into a definitive agreement to sell our Diversey Care division and the food hygiene and cleaning business within our Food Care division (collectively, "Diversey") for gross proceeds of $3.2 billion.
All amounts and percentages are approximate due to rounding and all dollars are in millions, except per share amounts. Business Overview and Reportable Segments Sealed Air Corporation (“SEE”, “Sealed Air”, or the “Company”, also referred to as “we”, “us”, or “our”) is a leading global provider of packaging solutions integrating high-performance materials, automation, equipment and services.
All amounts and percentages are approximate due to rounding and all dollars are in millions, except per share amounts. Business Overview and Reportable Segments Sealed Air Corporation (“SEE”, “Sealed Air”, or the “Company”, also referred to as “we”, “us”, or “our”) is a leading global provider of packaging solutions that integrate sustainable, high-performance materials, automation, equipment and services.
At December 31, 2022 and 2021, we had $7 million and $1 million, respectively, outstanding under various lines of credit extended to our subsidiaries. See Note 14, “Debt and Credit Facilities,” for further details. London Interbank Offered Rate (LIBOR) Phase Out In July 2017, the UK's Financial Conduct Authority (FCA), which regulates LIBOR, announced the phase out LIBOR.
At December 31, 2023 and 2022, we had $8 million and $7 million, respectively, outstanding under various lines of credit extended to our subsidiaries. See Note 14, “Debt and Credit Facilities,” for further details. London Interbank Offered Rate (LIBOR) Phase Out In July 2017, the UK's Financial Conduct Authority (FCA), which regulates LIBOR, announced the phase out of LIBOR.
Changes to tax laws, statutory tax rates and future taxable earnings can have an impact on valuation allowances related to deferred tax assets. In the event that actual results differ from these estimates in future periods, we may need to adjust the valuation allowance, which could have a material impact on our consolidated financial position and results of operations.
Changes to tax laws, statutory tax rates and future taxable earnings can impact valuation allowances related to deferred tax assets. If actual results differ from these estimates in future periods, we may need to adjust the valuation allowance, which could have a material impact on our consolidated financial position and results of operations.
Approximately $108 million in incremental trade receivables would have been outstanding at December 31, 2022 if collection on such invoice amounts were made directly from our customers on the invoice due date and not through our customers' supply chain financing arrangements or our factoring program.
Approximately $170 million in incremental trade receivables would have been outstanding at December 31, 2023 if collection on such invoice amounts were made directly from our customers on the invoice due date and not through our customers' supply chain financing arrangements or our factoring program.
Net Earnings from Continuing Operations Net earnings from continuing operations for the years ended December 31, 2022, 2021 and 2020 are included in the table below.
Net Earnings from Continuing Operations Net earnings from continuing operations for the years ended December 31, 2023, 2022 and 2021 are included in the table below.
In March 2021, the FCA announced that specific U.S. dollar LIBOR tenors (overnight, 1-month, 3-month, 6-month and 12-month) will continue to be published until June 30, 2023, while the 1-week and 2-month tenors are no longer being published effective December 31, 2021.
In March 2021, the FCA announced that specific U.S. dollar LIBOR tenors (overnight, 1-month, 3-month, 6-month and 12-month) would continue to be published until June 30, 2023, while the 1-week and 2-month tenors would no longer be published effective December 31, 2021.
The transaction was completed on September 6, 2017. The sale of Diversey qualified as discontinued operations. During 2022, we recorded a net gain of less than $1 million on the sale of discontinued operations. The gain relates primarily to the expiration of statutes on Diversey tax-related indemnification liabilities.
The transaction was completed on September 6, 2017. The sale of Diversey qualified as discontinued operations. During 2023 and 2022, we recorded a net gain of $2 million and less than $1 million, respectively, on the sale of discontinued operations. The gain relates primarily to the expiration of statutes on Diversey tax-related indemnification liabilities.
GAAP financial measures considers both the quantitative and qualitative aspects of the item, including among other things (i) its nature, (ii) whether or not it relates to our ongoing business operations, and (iii) whether or not we expect it to occur as part of our normal business on a regular basis. When we present non-U.S.
GAAP financial measures considers both the quantitative and qualitative aspects of the item, including among other things (i) its nature, (ii) whether or not it relates to our ongoing business operations, and (iii) whether or not we expect it to occur as part of our normal business on a regular basis.
Refer to the specific tables presented later in our Management’s Discussion and Analysis of Financial Condition and Results of Operations under Analysis of Historical Cash Flow for reconciliations of this non-U.S. GAAP financial measure to its most directly comparable U.S. GAAP measure.
Refer to the specific table presented later in our Management’s Discussion and Analysis of Financial Condition and Results of Operations under Analysis of Historical Cash Flow for reconciliation of this non-U.S. GAAP financial measure to its most directly comparable U.S. GAAP measure.
The plan has an accumulated comprehensive loss of $7 million ($5 million, net of tax), recorded within AOCL in Stockholders' Equity on our Consolidated Balance Sheets as of December 31, 2022. Upon plan termination or full buy-out, the accumulated comprehensive loss would be recognized to Other (expense) income, net within the Consolidated Statements of Operations.
The plan has accumulated comprehensive losses of $7 million ($5 million, net of tax), recorded within AOCL in Stockholders' equity on our Consolidated Balance Sheets as of December 31, 2023. Upon plan termination or full buy-out, the accumulated comprehensive loss would be recognized to Other expense, net within the Consolidated Statements of Operations.
All other components of benefits expense are recorded to Other (expense) income, net. Material changes to the principal assumptions could have a material impact on the costs, and the value of assets or liabilities recognized on our Consolidated Financial Statements.
All other components of periodic benefit income or cost are recorded to Other expense, net. Material changes to the principal assumptions could have a material impact on the costs, and the value of assets or liabilities recognized on our Consolidated Financial Statements.
Lines of Credit At December 31, 2022 and 2021, we had a $1 billion revolving credit facility program, with $985 million available as part of our senior secured credit facility. We had no outstanding borrowings under the facility at December 31, 2022 or 2021.
Lines of Credit At December 31, 2023 and 2022, we had a $1 billion revolving credit facility program, with $1 billion and $985 million available at December 31, 2023 and 2022, respectively, as part of our senior secured credit facility. We had no outstanding borrowings under the facility at December 31, 2023 and 2022.
GAAP Adjusted EBITDA (33.4) 13.1 Net Sales by Geographic Region The following tables present the components of the change in net sales by geographic region for the year ended December 31, 2022 compared with 2021 and for the year ended December 31, 2021 compared with 2020.
GAAP Adjusted EBITDA 11.1 (33.4) Net Sales by Geographic Region The following tables present the components of the change in net sales by geographic region for the year ended December 31, 2023 compared with 2022 and for the year ended December 31, 2022 compared with 2021.
Because of the conditional nature of these obligations and the unique facts and circumstances involved in each particular agreement, we are unable to reasonably estimate the potential maximum exposure associated with these items. Capital Expenditures We expect payments for capital expenditures to be approximately $260 million to $280 million in 2023.
Because of the conditional nature of these obligations and the unique facts and circumstances involved in each particular agreement, we are unable to reasonably estimate the potential maximum exposure associated with these items. Capital Expenditures We expect payments for capital expenditures to be approximately $230 million in 2024.
Contributions to Defined Benefit Pension Plans and Other Post-Employment Benefit Plans We maintain defined benefit pension plans and other post-employment benefit plans for some of our U.S. and our non-U.S. employees. We currently expect our contributions to these plans to be approximately $4 million in 2023.
Contributions to Defined Benefit Pension Plans and Other Post-Employment Benefit Plans We maintain defined benefit pension plans and other post-employment benefit plans for some of our U.S. and our non-U.S. employees. We currently expect our contributions to these plans to be approximately $10 million in 2024.
A 25 basis point change in the assumed discount rate and a 100 basis point change in the expected long-term rate of return on plan assets would have resulted in the following increases (decreases) in the projected benefit obligation at December 31, 2022 and the expected net periodic benefit cost for the year ending December 31, 2023: United States 25 Basis Point Increase (In millions) 25 Basis Point Decrease (In millions) Discount Rate Effect on 2022 projected benefit obligation $ (3.0) $ 3.1 Effect on 2023 expected net periodic benefit cost — — 100 Basis Point Increase (In millions) 100 Basis Point Decrea s e (In millions) Return on Assets Effect on 2023 expected net periodic benefit cost $ (1.1) $ 1.1 International 25 Basis Point Increase (In millions) 25 Basis Point Decrease (In millions) Discount Rate Effect on 2022 projected benefit obligation $ (13.9) $ 14.5 Effect on 2023 expected net periodic benefit cost — — 100 Basis Point Increase (In millions) 100 Basis Point Decrea s e (In millions) Return on Assets Effect on 2023 expected net periodic benefit cost $ (4.4) $ 4.4 During the fourth quarter of 2021, the Company purchased a buy-in insurance contract which covered the remaining portion of the liability for one of our defined benefit pension plans in the UK.
A 25 basis point change in the assumed discount rate and a 100 basis point change in the expected long-term rate of return on plan assets would have resulted in the following (decreases) increases in the projected benefit obligation at December 31, 2023 and the expected net periodic benefit cost for the year ending December 31, 2024: United States 25 Basis Point Increase (In millions) 25 Basis Point Decrease (In millions) Discount Rate Effect on 2023 projected benefit obligation $ (2.9) $ 3.0 Effect on 2024 expected net periodic benefit cost — — 100 Basis Point Increase (In millions) 100 Basis Point Decrea s e (In millions) Return on Assets Effect on 2024 expected net periodic benefit cost $ (1.0) $ 1.0 62 International 25 Basis Point Increase (In millions) 25 Basis Point Decrease (In millions) Discount Rate Effect on 2023 projected benefit obligation $ (15.8) $ 17.0 Effect on 2024 expected net periodic benefit cost — — 100 Basis Point Increase (In millions) 100 Basis Point Decrea s e (In millions) Return on Assets Effect on 2024 expected net periodic benefit cost $ (4.7) $ 4.7 During the fourth quarter of 2021, the Company purchased a buy-in insurance contract which covered the remaining portion of the liability for one of our defined benefit pension plans in the UK.
We have no other material cash balances deemed to be trapped as of December 31, 2022. Cash and Cash Equivalents The following table summarizes our accumulated cash and cash equivalents: December 31, (In millions) 2022 2021 Cash and cash equivalents $ 456.1 $ 561.0 See “Analysis of Historical Cash Flow” below.
We have no other material cash balances deemed to be trapped as of December 31, 2023. Cash and Cash Equivalents The following table summarizes our accumulated cash and cash equivalents: December 31, (In millions) 2023 2022 Cash and cash equivalents $ 346.1 $ 456.1 See “Analysis of Historical Cash Flow” below.
GAAP Adjusted net earnings and adjusted diluted EPS from continuing operations $ 605.0 $ 4.10 $ 540.8 $ 3.55 $ 498.4 $ 3.19 Weighted average number of common shares outstanding – Diluted 147.4 152.4 156.0 (1) Includes pre-tax Special Items, plus/less Tax Special Items and the tax impact of Special Items as seen in the following calculation of non-U.S.
GAAP Adjusted net earnings and adjusted diluted EPS from continuing operations $ 461.3 $ 3.18 $ 605.0 $ 4.10 $ 540.8 $ 3.55 Weighted average number of common shares outstanding – Diluted 144.9 147.4 152.4 (1) Includes pre-tax Special Items, plus/less Tax Special Items and the tax impact of Special Items as seen in the following calculation of non-U.S.
GAAP effective income tax rate, the Adjusted Tax Rate provides a useful and consistent comparison of the impact that tax expense has on our Company's performance. The following table shows our calculation of the non-U.S. GAAP Adjusted income tax rate: Year Ended December 31, (In millions, except per share data) 2022 2021 2020 U.S.
GAAP effective income tax rate, the Adjusted Tax Rate provides a useful and consistent comparison of the impact that tax expense has on our Company's performance. The following table shows our calculation of the non-U.S. GAAP Adjusted income tax rate: Year Ended December 31, (In millions) 2023 2022 2021 U.S.
GAAP Adjusted Net Earnings and Adjusted EPS from continuing operations. 38 Year Ended December 31, 2022 2021 2020 (In millions, except per share data) Net Earnings Diluted EPS Net Earnings Diluted EPS Net Earnings Diluted EPS U.S.
GAAP Adjusted net earnings and Adjusted EPS from continuing operations. 37 Year Ended December 31, 2023 2022 2021 (In millions, except per share data) Net Earnings Diluted EPS Net Earnings Diluted EPS Net Earnings Diluted EPS U.S.
GAAP Income tax provision from continuing operations $ 238.0 $ 225.0 $ 142.1 Tax Special Items (1) (49.4) (31.9) 12.1 Tax impact of Special Items (2) 17.5 (2.3) 7.6 Non-U.S. GAAP Adjusted Income tax provision from continuing operations $ 206.1 $ 190.8 $ 161.8 U.S. GAAP Effective income tax rate 32.6 % 31.4 % 22.7 % Non-U.S.
GAAP Income tax provision from continuing operations $ 90.4 $ 238.0 $ 225.0 Tax Special Items (1) 20.0 (49.4) (31.9) Tax impact of Special Items (2) 32.3 17.5 (2.3) Non-U.S. GAAP Adjusted Income tax provision from continuing operations $ 142.7 $ 206.1 $ 190.8 U.S. GAAP Effective income tax rate 21.0 % 32.6 % 31.4 % Non-U.S.
Interest expense, net for the years ended December 31, 2022, 2021 and 2020 was as follows: Year Ended December 31, Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Interest expense on our various debt instruments: Term Loan A due August 2022 $ 1.4 $ 6.1 $ 8.8 $ (4.7) $ (2.7) Term Loan A due July 2023 (1) 0.2 2.6 4.9 (2.4) (2.3) Term Loan A due March 2027 (2) 13.8 — — 13.8 — Revolving credit facility due July 2023 0.3 1.4 1.4 (1.1) — Revolving credit facility due March 2027 (2) 0.7 — — 0.7 — 4.875% Senior Notes due December 2022 (1) — 16.3 21.6 (16.3) (5.3) 5.250% Senior Notes due April 2023 (3) 6.9 23.2 23.2 (16.3) — 4.500% Senior Notes due September 2023 19.6 21.9 21.2 (2.3) 0.7 5.125% Senior Notes due December 2024 22.5 22.5 22.4 — 0.1 5.500% Senior Notes due September 2025 22.4 22.4 22.4 — — 1.573% Senior Secured Notes due October 2026 (1) 10.5 2.7 — 7.8 2.7 4.000% Senior Notes due December 2027 17.5 17.5 17.5 — — 5.000% Senior Notes due April 2029 (3) 15.2 — — 15.2 — 6.875% Senior Notes due July 2033 31.2 31.1 31.3 0.1 (0.2) Other interest expense 16.2 13.8 15.5 2.4 (1.7) Less: capitalized interest (8.9) (6.8) (5.6) (2.1) (1.2) Less: interest income (7.2) (6.9) (10.2) (0.3) 3.3 Total $ 162.3 $ 167.8 $ 174.4 $ (5.5) $ (6.6) 48 (1) In September 2021, Sealed Air issued $600 million of 1.573% Senior Secured Notes due 2026.
Interest expense, net for the years ended December 31, 2023, 2022 and 2021 was as follows: Year Ended December 31, Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Interest expense on our various debt instruments: Term Loan A due August 2022 $ — $ 1.4 $ 6.1 $ (1.4) $ (4.7) Term Loan A due July 2023 (1) — 0.2 2.6 (0.2) (2.4) Term Loan A due March 2027 (2) 33.4 13.8 — 19.6 13.8 Term Loan A2 due March 2027 (3) 44.7 — — 44.7 — Revolving credit facility due July 2023 — 0.3 1.4 (0.3) (1.1) Revolving credit facility due March 2027 (2) 8.4 0.7 — 7.7 0.7 4.875% Senior Notes due December 2022 (1) — — 16.3 — (16.3) 5.250% Senior Notes due April 2023 (4) — 6.9 23.2 (6.9) (16.3) 4.500% Senior Notes due September 2023 (5) 1.7 19.6 21.9 (17.9) (2.3) 5.125% Senior Notes due December 2024 (6) 20.0 22.5 22.5 (2.5) — 5.500% Senior Notes due September 2025 22.5 22.4 22.4 0.1 — 1.573% Senior Secured Notes due October 2026 (1) 10.5 10.5 2.7 — 7.8 4.000% Senior Notes due December 2027 17.6 17.5 17.5 0.1 — 6.125% Senior Notes due February 2028 (5) 45.5 — — 45.5 — 5.000% Senior Notes due April 2029 (4) 21.8 15.2 — 6.6 15.2 7.250% Senior Notes due February 2031 (6) 3.6 — — 3.6 — 6.875% Senior Notes due July 2033 31.2 31.2 31.1 — 0.1 Other interest expense (7) 29.7 16.2 13.8 13.5 2.4 Less: capitalized interest (13.1) (8.9) (6.8) (4.2) (2.1) Less: interest income (14.5) (7.2) (6.9) (7.3) (0.3) Total $ 263.0 $ 162.3 $ 167.8 $ 100.7 $ (5.5) (1) In September 2021, Sealed Air issued $600 million of 1.573% senior secured notes due 2026.
On a constant dollar basis, net sales increased $339 million, or 11%, in 2022 compared with 2021 primarily due to the following: • favorable pricing of $396 million, primarily reflecting price realization, with increases across all regions in response to the continued inflationary environment; and • acquisition impact of $6 million.
Foreign currency had a negative impact of $135 million. On a constant dollar basis, net sales increased $339 million, or 11%, in 2022 compared with 2021 primarily due to the following: 43 • favorable pricing of $396 million, primarily reflecting price realization, with increases across all regions in response to the inflationary environment; and • acquisition impact of $6 million.
Additionally, we expect benefits related to these plans paid directly by the Company to be $9 million in 2023.
Additionally, we expect benefits related to these plans paid directly by the Company to be approximately $9 million in 2024.
Income Tax Payments We expect tax payments on our operations to be approximately $240 million to $250 million in 2023. Future payments are uncertain and dependent on a number of factors including the amount of future taxable income. The results of on-going appeals or audits by various taxing authorities, including the IRS, could increase our tax payments.
Income Tax Payments We expect tax payments on our operations to be approximately $160 million in 2024. Future payments are uncertain and dependent on a number of factors including the amount of future taxable income. The results of ongoing appeals or audits by various taxing authorities, including the IRS, could increase our tax payments.
Therefore, the use and repayment of borrowings under such programs are classified as financing activities in our Consolidated Statements of Cash Flows. We do not recognize the cash flow within operating activities until the underlying invoices have been paid by our customer.
Our trade receivable securitization programs represent borrowings secured by outstanding customer receivables. Therefore, the use and repayment of borrowings under such programs are classified as financing activities in our Consolidated Statements of Cash Flows. We do not recognize the cash flow within operating activities until the underlying invoices have been paid by our customer.
Other (Expense) Income, net Impairment (loss)/fair value gain on equity investments, net For the years ended December 31, 2022, 2021 and 2020, we recorded a net loss of $31 million, a fair value gain of $7 million, and a fair value gain of $15 million, respectively, related to SEE Ventures equity investments.
Other Expense, net Impairment (loss)/fair value gain on equity investments, net For the years ended December 31, 2023, 2022 and 2021, SEE recorded none, a net loss of $31 million and a fair value gain of $7 million, respectively, related to SEE Ventures equity investments.
During 2022, the Company paid $280 million for share repurchases, compared to $403 million during in 2021. Debt related activities were a cash use of $11 million during 2022, compared to a use of cash of $32 million during 2021.
The decrease in cash outflows for financing activities was primarily related to a decrease in share repurchases. During 2022, the Company paid $280 million for share repurchases, compared to $403 million during in 2021. Debt related activities were a cash use of $11 million during 2022, compared to a use of cash of $32 million during 2021.
At December 31, 2022, the total projected benefit obligation for our international pension plans was $482 million, and the total benefit cost for the year ended December 31, 2022 was $1 million. The employer service cost of our pension plans is charged to Cost of sales and Selling, general and administrative expenses.
At December 31, 2023, the total projected benefit obligation for our international pension plans was $539 million, and the total benefit cost for the year ended December 31, 2023 was $7 million. The employer service cost of our pension plans is charged to Cost of sales and Selling, general and administrative expenses.
GAAP financial metrics exclude certain specified items (“Special Items”), including restructuring charges and restructuring associated costs, adjustments in the valuation of our "SEE Ventures" portfolio (which may include debt or equity investments), and other charges related to acquisitions and divestitures, gains and losses related to acquisitions and divestitures, special tax items or tax benefits (collectively, “Tax Special Items”) and certain other items.
GAAP financial metrics exclude certain specified items (“Special Items”), including restructuring charges and restructuring associated costs, amortization of intangible assets and inventory step-up expense related to the acquisition of Liquibox, adjustments in the valuation of our "SEE Ventures" portfolio (which may include debt or equity investments), and other charges related to acquisitions and divestitures, gains and losses related to acquisitions and divestitures, special tax items or tax benefits (collectively, “Tax Special Items”) and certain other items.
GAAP Consolidated Adjusted EBITDA from continuing operations (1) $ 1,210.2 $ 1,131.6 $ 1,051.1 6.9 % 7.7 % Non-U.S. GAAP Adjusted EPS from continuing operations (2) $ 4.10 $ 3.55 $ 3.19 15.5 % 11.3 % # Denotes where percentage change is not meaningful. (1) See “Non-U.S. GAAP Information” for a reconciliation of U.S.
GAAP Consolidated Adjusted EBITDA from continuing operations (1) $ 1,106.6 $ 1,210.2 $ 1,131.6 (8.6) % 6.9 % Non-U.S. GAAP Adjusted EPS from continuing operations (2) $ 3.18 $ 4.10 $ 3.55 (22.4) % 15.5 % # Denotes where percentage change is not meaningful. (1) See “Non-U.S. GAAP Information” for a reconciliation of U.S.
We adjust this liability to take into account changing facts and circumstances, including the results of tax audits and changes in tax law.
We adjust this liability to consider changing facts and circumstances, including the results of tax audits and changes in tax law.
GAAP Earnings before income tax provision from continuing operations $ 729.3 $ 716.2 $ 626.2 Pre-tax impact of Special Items 81.8 15.4 34.0 Non-U.S. GAAP Adjusted Earnings before income tax provision from continuing operations $ 811.1 $ 731.6 $ 660.2 U.S.
GAAP Earnings before income tax provision from continuing operations $ 429.7 $ 729.3 $ 716.2 Pre-tax impact of Special Items 174.3 81.8 15.4 Non-U.S. GAAP Adjusted Earnings before income tax provision from continuing operations $ 604.0 $ 811.1 $ 731.6 U.S.
GAAP net debt $ 3,222.4 $ 3,147.1 (1) Amounts are net of unamortized discounts and debt issuance costs of $19 million as of December 31, 2022 and 2021. See Note 14, “Debt and Credit Facilities,” for further details.
GAAP net debt $ 4,344.2 $ 3,222.4 (1) Amounts are net of unamortized discounts and debt issuance costs of $37 million and $19 million as of December 31, 2023 and 2022, respectively. See Note 14, “Debt and Credit Facilities,” for further details.
There are inherent uncertainties, however, related to fair value models, the inputs and our judgment in applying them to this analysis. Nonetheless, we believe that the combination of these methods provides a reasonable approach to estimate the fair value of our reporting units.
Fair value computed by these models is arrived at using a number of factors and inputs. There are inherent uncertainties, however, related to fair value models, the inputs and our judgment in applying them to this analysis. Nonetheless, we believe that the combination of these methods provides a reasonable approach to estimate the fair value of our reporting units.
Year Ended December 31, % Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Food $ 755.1 $ 688.4 $ 647.5 9.7 % 6.3 % Adjusted EBITDA Margin 22.8 % 22.1 % 22.9 % Protective 465.6 446.2 408.0 4.3 % 9.4 % Adjusted EBITDA Margin 20.0 % 18.4 % 19.6 % Corporate (10.5) (3.0) (4.4) 250.0 % (31.8) % Non-U.S.
Year Ended December 31, % Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Food $ 775.0 $ 755.1 $ 688.4 2.6 % 9.7 % Adjusted EBITDA Margin 22.0 % 22.8 % 22.1 % Protective 361.8 465.6 446.2 (22.3) % 4.3 % Adjusted EBITDA Margin 18.4 % 20.0 % 18.4 % Corporate (30.2) (10.5) (3.0) # # Non-U.S.
(In millions) Americas EMEA APAC Total 2021 Net Sales $ 3,522.3 63.6 % $ 1,200.0 21.7 % $ 811.5 14.7 % $ 5,533.8 100.0 % Price 521.4 14.8 % 136.7 11.4 % 39.9 4.9 % 698.0 12.6 % Volume (1) (255.2) (7.2) % (55.2) (4.6) % (20.0) (2.4) % (330.4) (6.0) % Total organic change (non-U.S.
GAAP) (140.2) (3.8) % (10.7) (0.9) % (2.1) (0.3) % (153.0) (2.7) % 2023 Net Sales $ 3,578.3 65.2 % $ 1,149.3 20.9 % $ 761.3 13.9 % $ 5,488.9 100.0 % (In millions) Americas EMEA APAC Total 2021 Net Sales $ 3,522.3 63.6 % $ 1,200.0 21.7 % $ 811.5 14.7 % $ 5,533.8 100.0 % Price 521.4 14.8 % 136.7 11.4 % 39.9 4.9 % 698.0 12.6 % Volume (1) (255.2) (7.2) % (55.2) (4.6) % (20.0) (2.4) % (330.4) (6.0) % Total organic change (non-U.S.
If the results of our qualitative assessment indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we are required to perform a quantitative assessment to determine the fair value of the reporting unit. 63 Alternatively, if an optional qualitative goodwill impairment assessment is not performed, we may perform a quantitative assessment.
If the results of our qualitative assessment indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we are required to perform a quantitative assessment to determine the fair value of the reporting unit.
Analysis of Historical Cash Flow The following table shows the changes in our Consolidated Statements of Cash Flows in the years ended December 31, 2022, 2021 and 2020. 57 Year Ended December 31, Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Net cash provided by operating activities $ 613.3 $ 709.7 $ 737.0 $ (96.4) $ (27.3) Net cash used in investing activities (243.0) (125.7) (159.8) (117.3) 34.1 Net cash used in financing activities (446.7) (575.8) (261.7) 129.1 (314.1) Effect of foreign currency exchange rate changes on cash and cash equivalents (28.5) 4.1 (29.2) (32.6) 33.3 In addition to net cash provided by operating activities, we use free cash flow as a useful measure of performance and as an indication of the strength and ability of our operations to generate cash.
Analysis of Historical Cash Flow The following table shows the changes in our Consolidated Statements of Cash Flows in the years ended December 31, 2023, 2022 and 2021. 55 Year Ended December 31, Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Net cash provided by operating activities $ 516.2 $ 613.3 $ 709.7 $ (97.1) $ (96.4) Net cash used in investing activities (1,378.2) (243.0) (125.7) (1,135.2) (117.3) Net cash provided by (used in) financing activities 755.7 (446.7) (575.8) 1,202.4 129.1 Effect of foreign currency exchange rate changes on cash and cash equivalents (3.7) (28.5) 4.1 24.8 (32.6) In addition to net cash from operating activities, we use free cash flow as a useful measure of performance and as an indication of the strength and ability of our operations to generate cash.
Gross amounts received under these programs for the year ended December 31, 2022 were $659 million, of which $161 million was received in the fourth quarter. Gross amounts received under these programs for the year ended December 31, 2021 were $687 million, of which $207 million was received in the fourth quarter.
Gross amounts received under these programs for the year ended December 31, 2023 were $750 million, of which $186 million was received in the fourth quarter. Gross amounts received under these programs for the year ended December 31, 2022 were $659 million, of which $161 million was received in the fourth quarter.
SG&A expenses were impacted by favorable foreign currency translation of $23 million. On a constant dollar basis, SG&A expenses increased $37 million, or 5%.
SG&A expenses were impacted by favorable foreign currency translation of $5 million. On a constant dollar basis, SG&A expenses decreased approximately $23 million, or 3%.
GAAP Consolidated Adjusted EBITDA from continuing operations: Year Ended December 31, (In millions) 2022 2021 2020 Net earnings from continuing operations $ 491.3 $ 491.2 $ 484.1 Interest expense, net 162.3 167.8 174.4 Income tax provision 238.0 225.0 142.1 Depreciation and amortization 236.8 232.2 216.5 Special Items: Restructuring charges 12.1 14.5 11.0 Other restructuring associated costs 9.3 16.5 19.5 Foreign currency exchange loss due to highly inflationary economies 8.8 3.6 4.7 Loss on debt redemption and refinancing activities 11.2 18.6 — Impairment loss/fair value (gain) on equity investments, net 30.6 (6.6) (15.1) Impairment of debt investment — 8.0 — Charges related to acquisition and divestiture activity 3.1 2.6 7.1 Gain on sale of Reflectix — (45.3) — Other Special Items 6.7 3.5 6.8 Pre-tax impact of Special Items 81.8 15.4 34.0 Non-U.S.
GAAP Consolidated Adjusted EBITDA from continuing operations: Year Ended December 31, (In millions) 2023 2022 2021 Net earnings from continuing operations $ 339.3 $ 491.3 $ 491.2 Interest expense, net 263.0 162.3 167.8 Income tax provision 90.4 238.0 225.0 Depreciation and amortization, net of adjustments (1) 239.6 236.8 232.2 Special Items: Liquibox intangible amortization 27.9 — — Liquibox inventory step-up amortization 10.2 — — Restructuring charges 15.6 12.1 14.5 Other restructuring associated costs 34.5 9.3 16.5 Foreign currency exchange loss due to highly inflationary economies 23.1 8.8 3.6 Loss on debt redemption and refinancing activities 13.2 11.2 18.6 Impairment loss/fair value (gain) on equity investments, net — 30.6 (6.6) Impairment of debt investment — — 8.0 Contract terminations 14.6 — — Charges related to acquisition and divestiture activity 28.3 3.1 2.6 Gain on sale of Reflectix — — (45.3) CEO severance 6.1 — — Other Special Items 0.8 6.7 3.5 Pre-tax impact of Special Items 174.3 81.8 15.4 Non-U.S.
This increase was partially offset by: • lower volumes of $15 million, primarily due to food retail market declines and the adverse impact from prior supply disruptions; and • higher operating costs of $8 million, including increased costs in our operations associated with supply disruptions, and investment spend in the business to drive future growth, including higher travel and entertainment expenses, partially offset by productivity improvements. 2021 compared with 2020 On a reported basis, Segment Adjusted EBITDA increased $41 million in 2021 as compared to 2020.
This increase was partially offset by: • lower volumes of $15 million, primarily due to food retail market declines and the adverse impact from prior supply disruptions; and 50 • higher operating costs of $8 million, including increased costs in our operations associated with supply disruptions, and investment spend in the business to drive future growth, including higher travel and entertainment expenses, partially offset by productivity improvements.
Year Ended December 31, % Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Selling, general and administrative expenses $ 786.2 $ 772.4 $ 773.7 1.8 % (0.2) % As a % of net sales 13.9 % 14.0 % 15.8 % 2022 compared with 2021 As reported, SG&A expenses increased $14 million in 2022 as compared to 2021.
Year Ended December 31, % Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Selling, general and administrative expenses $ 759.1 $ 786.2 $ 772.4 (3.4) % 1.8 % As a % of net sales 13.8 % 13.9 % 14.0 % 2023 compared with 2022 As reported, SG&A expenses decreased $27 million in 2023 as compared to 2022.
Our portfolio of solutions includes leading brands such as CRYOVAC ® brand food packaging, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated packaging, BUBBLE WRAP ® brand packaging, SEE Automation™ solutions and prismiq™ smart packaging and digital printing. The Company’s Food and Protective segments are considered reportable segments under FASB ASC Topic 280.
Our portfolio of solutions includes leading brands such as CRYOVAC ® brand food packaging, LIQUIBOX ® brand liquids systems, SEALED AIR ® brand protective packaging, AUTOBAG ® brand automated packaging systems, and BUBBLE WRAP ® brand packaging. The Company’s Food and Protective segments are considered reportable segments under FASB ASC Topic 280.
Below are the details of non-U.S. GAAP free cash flow for the years ended December 31, 2022, 2021 and 2020. Year Ended December 31, Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Cash flow provided by operating activities $ 613.3 $ 709.7 $ 737.0 $ (96.4) $ (27.3) Capital expenditures (237.3) (213.1) (181.1) (24.2) (32.0) Non-U.S.
Below are the details of non-U.S. GAAP free cash flow for the years ended December 31, 2023, 2022 and 2021. Year Ended December 31, Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Cash flow provided by operating activities $ 516.2 $ 613.3 $ 709.7 $ (97.1) $ (96.4) Capital expenditures (244.2) (237.3) (213.1) (6.9) (24.2) Non-U.S.
This increase was partially offset by: • lower volumes of $93 million, primarily due to recessionary pressures in the industrial and fulfillment markets and de-stocking throughout the value chain; • divestiture impact of $6 million; and • higher operating costs of $5 million, due to increased investment spend in the business to drive future growth, including higher travel and entertainment expenses. 2021 compared with 2020 On a reported basis, Segment Adjusted EBITDA increased $38 million in 2021 as compared to 2020.
This increase was partially offset by: • lower volumes of $93 million, primarily due to recessionary pressures in the industrial and fulfillment markets and de-stocking throughout the value chain; • divestiture impact of $6 million; and • higher operating costs of $5 million, due to increased investment spend in the business to drive future growth, including higher travel and entertainment expenses.
GAAP Net earnings and diluted EPS from continuing operations $ 491.3 $ 3.33 $ 491.2 $ 3.22 $ 484.1 $ 3.10 Special Items (1) 113.7 0.77 49.6 0.33 14.3 0.09 Non-U.S.
GAAP Net earnings and diluted EPS from continuing operations $ 339.3 $ 2.34 $ 491.3 $ 3.33 $ 491.2 $ 3.22 Special Items (1) 122.0 0.84 113.7 0.77 49.6 0.33 Non-U.S.
The following table presents the approximate favorable or (unfavorable) impact that foreign currency translation had on certain components of our consolidated financial results: 43 (In millions) 2022 vs. 2021 2021 vs. 2020 Net sales $ (224.2) $ 67.9 Cost of sales 165.9 (48.6) Selling, general and administrative expenses 23.3 (9.2) Net earnings (22.0) 9.0 Non-U.S.
The following table presents the approximate favorable or (unfavorable) impact that foreign currency translation had on certain components of our consolidated financial results: 41 (In millions) 2023 vs. 2022 2022 vs. 2021 Net sales $ (100.1) $ (224.2) Cost of sales 86.6 165.9 Selling, general and administrative expenses 4.5 23.3 Non-U.S.
While the nature and amount of individual Special Items vary from period to period, we believe our calculation of Adjusted EBITDA is applied consistently to all periods and, in conjunction with other U.S. GAAP and non-U.S.
While the nature and amount of individual Special Items vary from period to period, we believe our calculation of 36 Adjusted EBITDA is applied consistently to all periods and, in conjunction with other U.S. GAAP and non-U.S. GAAP financial measures, Adjusted EBITDA provides a useful and consistent comparison of our Company's performance to other periods.
We recognized a $19 million pre-tax loss on such repurchase, primarily driven by the tender offer consideration beyond the principal amount of the notes tendered. See Note 14, "Debt and Credit Facilities," for further details.
A portion of the proceeds were used to repurchase the Company's 4.875% Senior Notes due 2022. We recognized a $19 million pre-tax loss on such repurchase, primarily driven by the tender offer consideration beyond the principal amount of the notes tendered. See Note 14, "Debt and Credit Facilities," for further details.
Year Ended December 31, % Change (In millions, except per share amounts) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Net sales $ 5,641.9 $ 5,533.8 $ 4,903.2 2.0 % 12.9 % Gross profit $ 1,772.9 $ 1,680.9 $ 1,609.3 5.5 % 4.4 % As a % of net sales 31.4 % 30.4 % 32.8 % Operating profit $ 944.8 $ 900.9 $ 788.1 4.9 % 14.3 % As a % of net sales 16.7 % 16.3 % 16.1 % Net earnings from continuing operations $ 491.3 $ 491.2 $ 484.1 — % 1.5 % Gain on sale of discontinued operations, net of tax 0.3 15.6 18.8 (98.1) % (17.0) % Net earnings $ 491.6 $ 506.8 $ 502.9 (3.0) % 0.8 % Basic: Continuing operations $ 3.37 $ 3.26 $ 3.12 3.4 % 4.5 % Discontinued operations — 0.10 0.12 # (16.7) % Net earnings per common share - basic $ 3.37 $ 3.36 $ 3.24 0.3 % 3.7 % Diluted: Continuing operations $ 3.33 $ 3.22 $ 3.10 3.4 % 3.9 % Discontinued operations — 0.10 0.12 # (16.7) % Net earnings per common share - diluted $ 3.33 $ 3.32 $ 3.22 0.3 % 3.1 % Weighted average number of common shares outstanding: Basic 145.9 150.9 155.2 Diluted 147.4 152.4 156.0 Non-U.S.
Year Ended December 31, % Change (In millions, except per share amounts) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Net sales $ 5,488.9 $ 5,641.9 $ 5,533.8 (2.7) % 2.0 % Gross profit $ 1,641.3 $ 1,772.9 $ 1,680.9 (7.4) % 5.5 % As a % of net sales 29.9 % 31.4 % 30.4 % Operating profit $ 754.6 $ 944.8 $ 900.9 (20.1) % 4.9 % As a % of net sales 13.7 % 16.7 % 16.3 % Net earnings from continuing operations $ 339.3 $ 491.3 $ 491.2 (30.9) % — % Gain on sale of discontinued operations, net of tax 2.3 0.3 15.6 # (98.1) % Net earnings $ 341.6 $ 491.6 $ 506.8 (30.5) % (3.0) % Basic: Continuing operations $ 2.35 $ 3.37 $ 3.26 (30.3) % 3.4 % Discontinued operations 0.02 — 0.10 # # Net earnings per common share - basic $ 2.37 $ 3.37 $ 3.36 (29.7) % 0.3 % Diluted: Continuing operations $ 2.34 $ 3.33 $ 3.22 (29.7) % 3.4 % Discontinued operations 0.02 — 0.10 # # Net earnings per common share - diluted $ 2.36 $ 3.33 $ 3.32 (29.1) % 0.3 % Weighted average number of common shares outstanding: Basic 144.4 145.9 150.9 Diluted 144.9 147.4 152.4 Non-U.S.
The increase in SG&A expenses was primarily the result of inflation on labor costs, investment spend in the business to drive future growth, higher expenses associated with acquisition and divestiture activity, and higher credit losses, primarily from one North American customer, partially offset by favorable productivity benefits. 2021 compared with 2020 As reported, SG&A expenses decreased $1 million in 2021 as compared to 2020.
On a constant dollar basis, SG&A expenses increased $37 million, or 5%. The increase in SG&A expenses was primarily the result of inflation on labor costs, investment spend in the business to drive future growth, higher expenses associated with acquisition and divestiture activity, and higher credit losses, primarily from one North American customer, partially offset by favorable productivity benefits.
As a result of this activity, the Company has been utilizing credits on indirect and direct tax payments. See Note 23, “Other (Expense) Income, net,” for the components of other (expense) income, net.
As a result of this activity, the Company has been utilizing credits on indirect and direct tax payments. 47 See Note 23, “Other Expense, net,” for the additional components of Other expense, net. Income Taxes The table below shows our effective income tax rate (“ETR”).
The measurement date used to determine the benefit obligation and plan assets is December 31. 64 At December 31, 2022, the total projected benefit obligation for our U.S. pension plan was $140 million, and the total benefit income for the year ended December 31, 2022 was $3 million.
The measurement date used to determine the benefit obligation and plan assets is December 31. At December 31, 2023, the total projected benefit obligation for our U.S. pension plan was $136 million, and the total benefit cost for the year ended December 31, 2023 was $2 million.
A review of goodwill may be initiated before or after conducting the annual analysis if events or changes in circumstances indicate the carrying value of goodwill may no longer be recoverable.
A review of goodwill may be initiated before or after conducting the annual analysis if events or changes in circumstances indicate the carrying value of goodwill may no longer be recoverable. A reporting unit is the operating segment, or one level below the operating segment (a "component").
Cost of Sales Cost of sales for the years ended December 31, 2022, 2021 and 2020 were as follows: Year Ended December 31, % Change (In millions) 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 Net sales $ 5,641.9 $ 5,533.8 $ 4,903.2 2.0 % 12.9 % Cost of sales 3,869.0 3,852.9 3,293.9 0.4 % 17.0 % As a % of net sales 68.6 % 69.6 % 67.2 % 2022 compared with 2021 As reported, cost of sales increased by $16 million, or 0.4%, in 2022 as compared to 2021.
Cost of Sales Cost of sales for the years ended December 31, 2023, 2022 and 2021 were as follows: Year Ended December 31, % Change (In millions) 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Net sales $ 5,488.9 $ 5,641.9 $ 5,533.8 (2.7) % 2.0 % Cost of sales 3,847.6 3,869.0 3,852.9 (0.6) % 0.4 % As a % of net sales 70.1 % 68.6 % 69.6 % 2023 compared with 2022 As reported, cost of sales decreased by $21 million, or 0.6%, in 2023 as compared to 2022.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

20 edited+5 added−5 removed11 unchanged
Biggest changeGenerally, we acquire these components at market prices in the region in which they will be used and do not use financial instruments to hedge commodity prices. Moreover, we seek to maintain appropriate levels of commodity raw material inventories thus minimizing the expense and risks of carrying excess inventories.
Biggest changeCommodities We use various commodity raw materials such as plastic resins and energy products such as electric power and natural gas in conjunction with our manufacturing processes. Generally, we acquire these components at market prices in the region in which they will be used and do not use financial instruments to hedge commodity prices.
Any portion of the net investment hedge that is determined to be ineffective is recorded in Other (expense) income, net on the Consolidated Statements of Operations. Other Derivative Instruments We may use other derivative instruments from time to time to manage exposure to foreign exchange rates and to access international financing transactions.
Any portion of the net investment hedge that is determined to be ineffective is recorded in Other expense, net on the Consolidated Statements of Operations. Other Derivative Instruments We may use other derivative instruments from time to time to manage exposure to foreign exchange rates and to access international financing transactions.
We believe that this enables us to better match operating cash flows with debt service requirements and to better match the currency of assets and liabilities. The U.S. dollar equivalent amount of 67 outstanding debt denominated in a functional currency other than the U.S. dollar was $467 million and $492 million at December 31, 2022 and 2021, respectively.
We believe that this enables us to better match operating cash flows with debt service requirements and to better match the currency of assets and liabilities. The U.S. dollar equivalent amount of outstanding debt denominated in a functional currency other than the U.S. dollar was $131 million and $467 million at December 31, 2023 and 2022, respectively.
For derivative instruments that are designated and qualify as hedges of net investments in foreign operations, settlements and changes in fair values of the derivative instruments are recognized in unrealized gains (losses) on derivative instruments for net investment hedge, a component of AOCL, net of taxes, to offset the changes in the values of the net investments being hedged.
For derivative instruments that are designated and qualify as hedges of net investments in foreign operations, settlements and changes in fair values of the derivative instruments are recognized in Unrealized net loss on net investment hedges, a component of AOCL, net of taxes, to offset the changes in the values of the net investments being hedged.
A hypothetical 10% adverse change in foreign exchange rates at December 31, 2022 would have caused us to pay approximately $30 million to terminate these contracts. Based on our overall foreign exchange exposure, we estimate this change would not materially affect our financial position and liquidity.
A hypothetical 10% adverse change in foreign exchange rates at December 31, 2023 would have caused us 64 to pay approximately $42 million to terminate these contracts. Based on our overall foreign exchange exposure, we estimate this change would not materially affect our financial position and liquidity.
See Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards,” for additional information. As of December 31, 2022, 1% of our consolidated net sales were derived from our products sold in Argentina and net assets include $6 million of cash and cash equivalents domiciled in Argentina.
GAAP. See Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards,” for additional information. As of December 31, 2023, 1% of our consolidated net sales were derived from our products sold in Argentina and net assets include $8 million of cash and cash equivalents domiciled in Argentina.
Generally, the fair value of fixed rate debt will increase as interest rates fall and decrease as interest rates rise. A hypothetical 10% increase in interest rates would result in a decrease of $68 million in the fair value of the total debt balance at December 31, 2022.
Generally, the fair value of fixed rate debt will increase as interest rates fall and decrease as interest rates rise. A hypothetical 10% increase in interest rates would result in a decrease of $82 million in the fair value of the total debt balance at December 31, 2023.
Also, as of December 31, 2022, our Argentina subsidiaries had cumulative translation losses of $22 million. 66 Russia Recent fluctuations of the ruble have exposed us to heightened levels of foreign currency exchange risks. As of December 31, 2022, less than 2% of our consolidated net sales were derived from products sold in Russia.
Also, as of December 31, 2023, our Argentina subsidiaries had cumulative translation losses of $22 million. Russia Recent fluctuations of the ruble have exposed us to heightened levels of foreign currency exchange risks. As of December 31, 2023, approximately 1% of our consolidated net sales were derived from products sold in Russia.
For the years ended December 31, 2022, 2021 and 2020, we recognized a remeasurement loss of $9 million, $4 million and $5 million, respectively, within Other (expense) income, net on the Consolidated Statements of Operations, related to the designation of Argentina as a highly inflationary economy under U.S. GAAP.
As of July 1, 2018, Argentina was designated as a highly inflationary economy. For the years ended December 31, 2023, 2022 and 2021, we recognized a remeasurement loss of $23 million, $9 million and $4 million, respectively, within Other expense, net on the Consolidated Statements of Operations, related to the designation of Argentina as a highly inflationary economy under U.S.
Net Investment Hedge The €400 million 4.500% notes issued in June 2015 are designated as a net investment hedge, hedging a portion of our net investment in a certain European subsidiary against fluctuations in foreign exchange rates.
Net Investment Hedge In February 2023, the €400.0 million 4.500% senior notes issued in June 2015 that were previously designated as a net investment hedge, hedging a portion of our net investment in a certain European subsidiary against fluctuations in foreign exchange rates, were repaid.
At December 31, 2022, we had no outstanding interest rate swaps, collars or options. The information set forth in Note 15, “Derivatives and Hedging Activities,” under the caption “Interest Rate Swaps,” is incorporated herein by reference.
Interest Rates From time to time, we may use interest rate swaps, collars or options to manage our exposure to fluctuations in interest rates. At December 31, 2023, we had no outstanding interest rate swaps, collars or options. The information set forth in Note 15, “Derivatives and Hedging Activities,” under the caption “Interest Rate Swaps,” is incorporated herein by reference.
See Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards,” for details regarding the impact of inflation and currency fluctuation.
The effects of these could adversely impact our financial condition and results of operations. See Note 2, “Summary of Significant Accounting Policies and Recently Issued Accounting Standards,” for details regarding the impact of inflation and currency fluctuation.
We seek to minimize these risks through regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. We do not purchase, hold or sell derivative financial instruments for trading purposes. Interest Rates From time to time, we may use interest rate swaps, collars or options to manage our exposure to fluctuations in interest rates.
We seek to minimize these risks through regular operating and 63 financing activities and, when deemed appropriate, through the use of derivative financial instruments. We do not purchase, hold or sell derivative financial instruments for trading purposes.
These instruments can potentially limit foreign exchange exposure by swapping borrowings denominated in one currency for borrowings denominated in another currency. Outstanding Debt Our outstanding debt is generally denominated in the functional currency of the borrower or in euros as is the case with the issuance of €400 million of 4.500% senior notes due 2023.
These instruments can potentially limit foreign exchange exposure by swapping borrowings denominated in one currency for borrowings denominated in another currency. Outstanding Debt Our outstanding debt is generally denominated in the functional currency of the borrower.
We do not typically purchase substantial quantities in advance of production requirements. As a result, we are exposed to market risks related to changes in commodity prices of these components. 68
Moreover, we seek to maintain appropriate levels of commodity raw material inventories thus minimizing the expense and risks of carrying excess inventories. We do not typically purchase substantial quantities in advance of production requirements. As a result, we are exposed to market risks related to changes in commodity prices of these components. 66
Assets include $10 million of cash and cash equivalents domiciled in Russia. Also, as of December 31, 2022, our Russia subsidiary had cumulative translation losses of $36 million. Brazil Recent economic events in Brazil, including changes in the benchmark interest rate set by the Brazilian Central Bank, have exposed us to heightened levels of foreign currency exchange risks.
Assets include $10 million of cash and cash equivalents domiciled in Russia. Also, as of December 31, 2023, our Russia subsidiary had cumulative translation losses of $45 million. Impact of Inflation and Currency Fluctuation Economic and political events in certain countries have exposed us to heightened levels of inflation and foreign currency exchange risks.
These investments provide a stream of income equal to future benefit payments for pre-defined groups of participants; however, the Company maintains the primary liability for the projected benefit obligation related to these groups. As of December 31, 2022 and 2021, buy-in contracts represented $98 million, or 17%, and $135 million, or 16%, of the Company's total plan assets, respectively.
These investments provide a stream of income equal to future benefit payments for pre-defined groups of participants; however, the Company maintains the primary liability for the projected benefit obligation related to these groups.
As of December 31, 2022 and 2021, equity diversifying assets represented $84 million, or 15%, and $95 million, or 11%, of the Company's total plan assets, respectively. Other than the buy-in contracts and equity diversifiers noted above, we believe that our plan assets are highly liquid and may be readily redeemed to cover necessary plan payments.
Other than the buy-in contracts and equity diversifiers noted above, we believe that our plan assets are highly liquid and may be readily redeemed to cover necessary plan payments. There is a high degree of predictability of payments made from our defined benefit plans.
There is a high degree of predictability of payments made from our defined benefit plans. Based upon the annual valuation of our defined benefit pension plans at December 31, 2022, we expect net periodic benefit cost to be approximately $8 million in 2023.
Based upon the annual valuation of our defined benefit pension plans at December 31, 2023, we expect net periodic benefit cost to be approximately $6 million in 2024. See Note 17, “Profit Sharing, Retirement Savings Plans and Defined Benefit Pension Plans,” for further details on our defined benefit pension plans.
Additionally, our plan assets may, from time to time, be invested in assets designed to diversify the investment portfolio and protect against equity market movements. Some of these assets may only be redeemed on a quarterly basis.
As of December 31, 2023 and 2022, buy-in contracts represented $107 million, or 18%, and $98 million, or 17%, of the Company's total plan assets, respectively. 65 Additionally, our plan assets may, from time to time, be invested in assets designed to diversify the investment portfolio and protect against equity market movements.
Removed
As of July 1, 2018, Argentina was designated as a highly inflationary economy.
Added
In the first quarter of 2023, we entered into a series of cross-currency swaps with a combined notional amount of $433 million.
Removed
However, as of December 31, 2022, we do not anticipate these events will have a material impact on our 2023 results of operations. As of December 31, 2022, 3% of our consolidated net sales were derived from products sold in Brazil and net assets include $25 million of cash and cash equivalents domiciled in Brazil.
Added
Each of these cross-currency swaps were designated as net investment hedges of the Company's foreign currency exposure of its net investment in certain Euro-functional currency subsidiaries with Euro-denominated net assets, and the Company pays a fixed rate of Euro-based interest and receives a fixed rate of U.S. dollar interest.
Removed
Also, as of December 31, 2022, our Brazil subsidiaries had cumulative translation losses of $66 million. Impact of Inflation and Currency Fluctuation Economic and political events in certain countries have exposed us to heightened levels of inflation and foreign currency exchange risks. The effects of these could adversely impact our financial condition and results of operations.
Added
The Company has elected the spot method for assessing the effectiveness of these contracts. The maturity date for this series of cross-currency swaps is February 1, 2028. The fair value of this hedge as of December 31, 2023 was a $20 million loss and is included within Other non-current liabilities on our Consolidated Balance Sheets.
Removed
The decrease in the translated value of the debt was $18 million, net of deferred tax, as of December 31, 2022 and is reflected in AOCL, net of taxes on our Consolidated Balance Sheets.
Added
For the year ended December 31, 2023, we recognized $3 million of interest income related to these contracts, which is reflected in Interest expense, net on the Consolidated Statements of Operations.
Removed
See Note 17, “Profit Sharing, Retirement Savings Plans and Defined Benefit Pension Plans,” for further details on our defined benefit pension plans. Commodities We use various commodity raw materials such as plastic resins and energy products such as electric power and natural gas in conjunction with our manufacturing processes.
Added
Some of these assets may only be redeemed on a quarterly basis. As of December 31, 2023 and 2022, equity diversifying assets represented $77 million, or 13%, and $84 million, or 15%, of the Company's total plan assets, respectively.

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