WestRock Company announced results for its fiscal 2Q ended March 31, 2022. Net sales increased $944 million, or 21.3%, year-over-year as the prior year period lost an estimated $189 million of net sales associated with the ransomware incident and winter weather (“the Events”).
Excluding the prior year impact of the Events, net sales grew 17.0% year-over-year. Paper segment sales increased $408 million, or 36.0%, Corrugated Packaging segment sales increased $297 million, or 14.7%, Consumer Packaging segment sales increased $170 million, or 15.7%, and Distribution segment sales increased $82 million, or 29.3%.
Net income decreased $73 million year-over-year to $40 million. Results for the 2Q of fiscal 2022 included $363 million of pre-tax restructuring and other costs, $321 million of which was non-cash, primarily associated with the previously announced closure of the Panama City, Florida paper mill. The impact of higher selling price/mix and higher volumes were partially offset by increased cost inflation, lower productivity and other operational items. The prior year period was negatively impacted by $80 million pre-tax for lost sales and operational disruption from the Events as well as $20 million pre-tax of ransomware recovery costs, primarily professional fees.
Consolidated Adjusted EBITDA increased $213 million, or 33.3%, year-over-year due to strength across the segments, primarily in the Paper and Consumer Packaging segments.
“We delivered an outstanding 2Q, reporting record revenue and impressive adjusted earnings growth despite facing continued challenges from inflation, higher supply chain costs and labor shortages,” said David B. Sewell, CEO. “This strong performance speaks to the resiliency of our broad portfolio, and the resolve of our 50,000 talented employees. We remain focused on execution, and today have increased the midpoint of our full year guidance.”
WestRock Company is a global manufacturer of differentiated paper and packaging solutions.
