Greif Inc (GEF) 2023 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Greif's Third Quarter 2023 Earnings Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded. And I would now like to hand the conference over to your speaker today, Mr. Matt Leahy. Mr. Leahy, please go ahead.

美好的一天，感謝您的支持。歡迎參加 Greif 2023 年第三季度收益電話會議。 （操作員指示）請注意，今天的會議正在錄製中。現在我想將會議交給今天的發言者馬特·萊希先生。萊希先生，請繼續。

Thanks, and good morning, everyone. Welcome to Greif's Third Quarter Fiscal 2023 Earnings Conference Call. This is Matt Leahy, Greif's Vice President of Corporate Development and Investor Relations, and I'm joined by Ole Rosgaard, Greif's President and Chief Executive Officer; and Larry Hilsheimer, Greif's Chief Financial Officer. We will take questions at the end of today's call. In accordance with regulation fair disclosure, please ask questions regarding issues you consider important because we are prohibited from discussing material, nonpublic information with you on an individual basis.

謝謝，大家早上好。歡迎參加 Greif 2023 財年第三季度收益電話會議。我是格瑞夫 (Greif) 企業發展和投資者關係副總裁馬特·萊希 (Matt Leahy)，格瑞夫總裁兼首席執行官奧勒·羅斯加德 (Ole Rosgaard)；以及 Greif 首席財務官 Larry Hilsheimer。我們將在今天的電話會議結束時回答問題。根據公平披露規定，請就您認為重要的問題提出問題，因為我們禁止與您單獨討論重大非公開信息。

Please turn to Slide 2. As a reminder, during today's call, we will make forward-looking statements involving plans, expectations and beliefs related to future events. Actual results could differ materially from those discussed. Additionally, we will be referencing certain non-GAAP financial measures and reconciliation to the most directly comparable GAAP metrics -- in the appendix of today's presentation. And now I'll turn the presentation over to Ole on Slide 3.

請參閱幻燈片 2。提醒一下，在今天的電話會議中，我們將做出涉及與未來事件相關的計劃、期望和信念的前瞻性聲明。實際結果可能與討論的結果大不相同。此外，我們將在今天演示文稿的附錄中引用某些非公認會計原則財務指標以及與最直接可比的公認會計原則指標的調節。現在我將把幻燈片 3 上的演示文稿交給 Ole。

Thanks, Matt, and good morning, everyone. Our global Greif team executed very well in our fiscal third quarter and posted strong performance despite a continuation of historic volume headwinds. Our teams are leaning on our Build to Last Strategy to drive results in this difficult environment. And I could not be prouder of the work we are doing to manage and improve the business and better serve customers.

謝謝馬特，大家早上好。我們的全球 Greif 團隊在第三財季表現出色，儘管歷史性的銷量逆風持續，但仍表現強勁。我們的團隊依靠我們的基業長青戰略來在這個困難的環境中取得成果。我對我們為管理和改進業務以及更好地服務客戶所做的工作感到無比自豪。

Our performance in the first 9 months of 2023, with strong EBITDA performance and margins and free cash flow conversion well above our targeted 50% is a testament to the growing resilience of our business model and our commitment to both manage the present while building the future.

我們在2023 年前9 個月的業績，強勁的EBITDA 業績和利潤率以及自由現金流轉換遠高於我們的50% 目標，這證明了我們業務模式不斷增強的彈性，以及我們對管理當前和建設未來的承諾。

Before further covering our results, I want to share an exciting update on two of our key missions in our Build to Last strategy, creating thriving communities is a mission devoted to cultivating a culture of appreciation, inclusion and recognition for all our internal colleagues and external stakeholders.

在進一步介紹我們的成果之前，我想分享一下我們基業長青戰略中兩項關鍵使命的令人興奮的最新情況：創建繁榮的社區是一項致力於為我們所有內部同事和外部同事培養欣賞、包容和認可的文化的使命。利益相關者。

In the third quarter, we launched our Colleague Stock Purchase Plan, a program that enables colleagues from corporate down through production to acquire Greif Class A shares at a discount to market prices. We believe in the power of ownership to drive greater accountability and commitment to excellence across the organization.

第三季度，我們啟動了同事股票購買計劃，該計劃使從公司到生產部門的同事能夠以低於市場價格的價格購買格瑞夫 A 類股票。我們相信主人翁精神的力量可以推動整個組織更大的責任感和對卓越的承諾。

And this program will provide the means for our colleagues to participate in the economic benefits of value creation. I'm proud to welcome our colleagues to the table as fellow owners of our company and look forward to expanding this program in the months and years to come.

該計劃將為我們的同事提供參與價值創造的經濟效益的途徑。我很自豪地歡迎我們的同事作為我們公司的共同所有者參加會議，並期待在未來的幾個月和幾年裡擴大這一計劃。

On our mission to deliver Legendary Customer Service, each quarter, we present the latest results of our customer satisfaction index, a mechanism we used to formally receive regular feedback from customers on overall satisfaction with Greif in terms of product quality, customer service and our ability to deliver value. Our aspirational benchmark of success is a score of 95 out of 100.

秉承提供傳奇客戶服務的使命，我們每個季度都會發布客戶滿意度指數的最新結果，我們使用這一機制定期定期收到客戶對 Greif 在產品質量、客戶服務和我們能力方面的整體滿意度的反饋創造價值。我們理想的成功基準是 95 分（滿分 100 分）。

This quarter, our global consolidated score was 94.2, just shy of that goal and an exceptional result given the challenges our customers are facing in the markets. Greif's steadfast commitment to our customers is evident. We will provide you and support you and build on our existing relationships in good times and in bad, and you can count on us to deliver with quality and service excellence every day.

本季度，我們的全球綜合得分為 94.2，距離目標僅差一點，考慮到我們的客戶在市場中面臨的挑戰，這是一個出色的成績。格瑞夫對客戶的堅定承諾是顯而易見的。無論順境還是逆境，我們都會為您提供服務和支持，並鞏固我們現有的關係，您可以信賴我們每天都能提供優質的服務和卓越的服務。

Our dedication and relentless focus on customer service is core to who we are as an organization and our excellent CSI score during this challenging period is a reminder of the value we provide. Now I'd like to shift focus back to financial results on Slide 4, where I'll turn it over to Larry to kick things off.

我們對客戶服務的奉獻和不懈關注是我們作為一個組織的核心，在這個充滿挑戰的時期我們出色的 CSI 分數提醒我們提供的價值。現在我想將焦點轉移回幻燈片 4 上的財務業績，我將把它交給 Larry 來開始。

Thanks Ole, and good morning, everyone. Given Greif's overall financial performance relative to the operating environment we have been in this year, we want to briefly step back from our single quarter results and just take stock of where the company is now relative to our initial view and fiscal '23 guidance provided in December of 2022. At that time, we had started to see demand softness in many of our end markets and I discussed on our Q4 '22 earnings call, how, given our level of uncertainty, we had run a robust scenario analysis to arrive at the wide guidance range for 2023 of $820 million to $906 million in EBITDA and $410 million to $460 million in free cash flow. I'll be frank with everyone.

謝謝奧萊，大家早上好。鑑於 Greif 相對於我們今年所處的運營環境的整體財務業績，我們希望暫時回顧一下我們的單季度業績，並根據我們的初步觀點和 23 財年指引來評估該公司目前的狀況。 2022 年12 月。當時，我們開始看到許多終端市場的需求疲軟，我在22 年第4 季度的財報電話會議上討論了，鑑於我們的不確定性程度，我們如何進行穩健的情景分析來得出2023 年EBITDA 的指導範圍為8.2 億至9.06 億美元，自由現金流為4.1 億至4.6 億美元。我會對大家開誠佈公。

While we considered at the time the possibility of an extended slow demand cycle, we did not weight that heavily as doing so would imply we felt that we were headed into another industrial recession. Clearly, that initial assumption in December was wrong. And while we may not be in a broad economic recession, global manufacturing PMIs remained below 50 for 11th month in a row, and our year-to-date volumes across GIP and PPS are both tracking down mid- to high teens year-to-date.

雖然我們當時考慮了需求週期緩慢延長的可能性，但我們並沒有那麼重視，因為這樣做意味著我們認為我們正在陷入另一場工業衰退。顯然，12 月份的最初假設是錯誤的。儘管我們可能並未陷入大範圍的經濟衰退，但全球製造業 PMI 連續 11 個月保持在 50 以下，而且我們今年迄今為止的 GIP 和 PPS 交易量都在下降中位數至高位數。日期。

If that's not indicative of an industrial recession, then I'm not sure what is. Another relevant comparison is the recessionary scenario slide we outlined at our Investor Day in June of last year showing downside risk to $600 million to $700 million of EBITDA and $260 million to $320 million in free cash flow. A few points comparing that scenario against our current environment. Number one, recession scale drum volumes assumed 5% down versus actual Q3 of down over 10%.

如果這不代表工業衰退，那麼我不確定什麼才是。另一個相關比較是我們在去年 6 月的投資者日上概述的經濟衰退情景幻燈片，顯示 EBITDA 為 6 億至 7 億美元，自由現金流為 2.6 億至 3.2 億美元的下行風險。將這種情況與我們當前的環境進行比較的幾點。第一，經濟衰退規模的鼓銷量假設下降 5%，而第三季度實際下降超過 10%。

Recession-filled index prices assumed down 20% versus the actual down of 15% through July. Recession mill volumes assumed 5% down versus an actual down over 20% in Q3. Recession containerboard prices assumed 10% versus the actual Q3 down about 8%. To summarize, current steel drum volumes are tracking down double the downside scenario. Mill volumes are down, quadruple the downside scenario and overall pricing declines nearly match our downside scenario. And yet, our current guidance midpoint contemplates EBITDA and free cash flow that is over $100 million above the level we provided for a recession scenario with only a partial lift from M&A.

經濟衰退期間的指數價格假設下跌 20%，而 7 月份實際下跌 15%。經濟衰退期間工廠產量假設下降 5%，而第三季度實際下降超過 20%。假設經濟衰退時箱板紙價格下降 10%，而第三季度實際價格下降約 8%。總而言之，目前的鋼桶銷量正在下​​降兩倍。工廠產量下降，是下行情景的四倍，總體定價下降幾乎與我們的下行情景相符。然而，我們當前的指導中點考慮了 EBITDA 和自由現金流，比我們為經濟衰退情景提供的水平高出 1 億多美元，且併購僅帶來部分提升。

I illustrate these points to try to hammer home how well our teams are executing. And I also want to share my heartfelt thanks to all of our Greif colleagues for their commitment and dedication this year. Ole, thanks for letting me take the time to boast about our team's performance but is really commendable how well we are doing, and I'd like our investors to keep that in mind as they consider our detailed results.

我闡述這些要點是為了讓大家明白我們團隊的執行情況。我還想對格瑞夫所有同事今年的承諾和奉獻表示衷心的感謝。 Ole，感謝您讓我花時間誇耀我們團隊的表現，但我們的表現確實值得稱讚，我希望我們的投資者在考慮我們的詳細結果時牢記這一點。

Thanks, Larry. And well said. As Larry just mentioned, we again reported strong adjusted EBITDA of $226.5 million, only $2 million shy of our previous quarter and less than $25 million short of the very strong 2022 comparative period. Our free cash generation was also extraordinary reported at $167.1 million, nearly equal to the very strong Q3 of 2022, but on volumes, which were more or less 15% lower.

謝謝，拉里。說得好。正如拉里剛才提到的，我們再次報告強勁的調整後 EBITDA 為 2.265 億美元，僅比上一季度少了 200 萬美元，比 2022 年強勁的同期水平少了不到 2500 萬美元。據報導，我們的自由現金生成量也非常出色，為 1.671 億美元，幾乎與 2022 年第三季度的強勁水平持平，但數量上或多或少下降了 15%。

As mentioned in my opening remarks, that free cash flow figure represents a conversion rate of over 70%, which is well ahead of our long-term target of more than 50%. Our disciplined approach to managing costs and working capital are driving this performance as we are truly playing with the entire piano, spanning from operational and commercial excellence initiatives to supply chain and sourcing and automation efforts, all to drive improvements across our business.

正如我在開場白中提到的，自由現金流數字代表了超過 70% 的轉化率，遠遠超出了我們超過 50% 的長期目標。我們嚴格的成本和營運資本管理方法正在推動這一業績，因為我們真正在全面發揮作用，從運營和商業卓越計劃到供應鏈、採購和自動化工作，所有這些都是為了推動我們整個業務的改進。

We also announced another step-up in our annual reoccurring dividends with our total quarterly dividend now at $0.52 and $0.78 for Class A and B shares, respectively. The strength of our balance sheet and growing free cash flow generation has widened our available capital allocation opportunities, and we are excited to continue to deliver cash to our shareholders.

我們還宣布再次提高年度經常性股息，目前 A 類股和 B 類股的季度股息總額分別為 0.52 美元和 0.78 美元。我們的資產負債表實力和不斷增長的自由現金流擴大了我們可用的資本配置機會，我們很高興繼續向股東提供現金。

Lastly, I'm excited to announce another addition to the Greif portfolio. As this past week, we signed an agreement to acquire 51% ownership in ColePak, which I'd like to discuss more on the following slides.

最後，我很高興地宣布 Greif 產品組合又添新成員。上週，我們簽署了一項收購 ColePak 51% 所有權的協議，我想在下面的幻燈片中對此進行更多討論。

Slide 5, please. ColePak is a truly special paper converting business and the #2 supplier of bulk and specialty partitions in North America.

請幻燈片 5。 ColePak 是一家真正的特種紙張加工企業，也是北美第二大散裝和特種隔板供應商。

For those unfamiliar, a partition is a divider included commonly in corrugated boxes as a method of separating fragile content such as glass bottles. ColePak manufactures a wide range of partitions from both URB and Containerboard and predominantly serves the stable and growing food and beverage markets. They have 2 facilities in Urbana, Ohio and in Fairfield, California, a site which is strategically located to serve the high-end wine bottling business in Napa Valley.

對於那些不熟悉的人來說，隔板是瓦楞紙箱中常見的分隔物，作為分隔玻璃瓶等易碎物品的方法。 ColePak 生產各種 URB 和箱板隔板，主要服務於穩定且不斷增長的食品和飲料市場。他們在俄亥俄州厄巴納和加利福尼亞州費爾菲爾德擁有 2 處工廠，該地點地理位置優越，為納帕谷的高端葡萄酒裝瓶業務提供服務。

This business is immediately margin accretive to the global Greif portfolio and is expected to contribute EBITDA before synergies of $15 million to $20 million per year. While the business is small relative to our global portfolio, several organic and inorganic growth opportunities remain to quickly grow and further scale this niche business.

該業務可立即為全球格瑞夫投資組合帶來利潤增值，預計每年在協同效應之前將貢獻 1500 萬至 2000 萬美元的 EBITDA。雖然該業務相對於我們的全球投資組合而言規模較小，但仍有一些有機和無機增長機會來快速增長並進一步擴大這一利基業務。

On top of the favorable stand-alone financials, ColePak's converting network consumes approximately 25,000 tons of paper per year adding incremental downstream integration into our PPS network. Last but certainly not least, ColePak's management team is an excellent cultural fit to Greif. We have known and done business with the Cole family for years and share a set of values on how to take care of colleagues and serve customers.

除了有利的獨立財務狀況外，ColePak 的加工網絡每年消耗約 25,000 噸紙張，增加了下游與我們 PPS 網絡的增量整合。最後但並非最不重要的一點是，ColePak 的管理團隊與 Greif 的文化非常契合。我們與科爾家族相識並開展業務已有多年，並且在如何照顧同事和服務客戶​​方面擁有一套共同的價值觀。

We are excited to partner with ColePak in this new venture and grow the business together. I'll conclude by saying that even after the pro forma impact of this acquisition, our balance sheet remains in great shape, and we sit below the midpoint of our target leverage ratio range. Our M&A pipeline remains robust, and we intend to continue deploying capital towards more value-accretive targets in the future.

我們很高興能與 ColePak 合作開展這項新業務並共同發展業務。最後我要說的是，即使在這次收購產生了預計影響之後，我們的資產負債表仍然保持良好狀態，並且我們的槓桿率低於目標槓桿率範圍的中點。我們的併購渠道仍然強勁，我們打算在未來繼續將資本部署到更具增值價值的目標。

Now I'd like to shift gears and take a deeper dive into our segment results. So please turn to Slide 6. Our GIP business produced an excellent result with flat year-over-year gross profit despite volume headwinds of nearly 20% in the Americas and nearly 10% in EMEA and APAC. Once again, the strict adherence to our value over volume philosophy in the markets, the benefits of our cost-out actions taken earlier this year and lower year-over-year input costs led to an adjusted EBITDA lift of nearly $10 million year-over-year despite substantially lower revenues.

現在我想換個方向，更深入地研究我們的細分市場結果。因此，請參閱幻燈片 6。儘管美洲銷量下降近 20%，歐洲、中東和非洲和亞太地區銷量下降近 10%，但我們的 GIP 業務取得了出色的業績，毛利潤同比持平。再一次，嚴格遵守我們在市場上的價值重於數量的理念、我們今年早些時候採取的成本削減行動的好處以及同比投入成本的降低，導致調整後的 EBITDA 同比增長近 1000 萬美元儘管收入大幅下降，但仍實現了一年的增長。

On the volume sides, all GIP products and geographies showed softness compared to the prior year, with global steel and resin-based products, both down mid-double digits on a per day basis. Sequentially, our third quarter closely mirrored our second quarter with demand flat in EMEA and APAC and slightly down in LATAM and North America.

在成交量方面，所有 GIP 產品和地區均較上年表現疲軟，全球鋼鐵和樹脂產品的日均銷量均下降中兩位數。接下來，我們的第三季度與第二季度的情況非常相似，歐洲、中東和非洲和亞太地區的需求持平，拉丁美洲和北美的需求略有下降。

Through August, we do not have a line of sight into any notable upward demand inflections in our GIP business, and we'll continue to manage this business as we have through the year with a focus on cost and customer service. I commend our global GIP team for their exemplary performance in the third quarter and throughout 2023.

整個 8 月份，我們的 GIP 業務並未出現任何顯著的需求上升變化，我們將繼續像全年一樣管理這項業務，重點關注成本和客戶服務。我讚揚我們的全球 GIP 團隊在第三季度和 2023 年全年的出色表現。

Please turn to Slide 7. Paper Packaging's third quarter sales declined $146 million year-over-year, primarily due to demand weakness across our converting businesses and mills. We took approximately 55,000 tons of economic downtime across our mill system in the third quarter as we faced nearly 10% per day volume declines across our primary converting operations.

請參閱幻燈片 7。紙包裝第三季度銷售額同比下降 1.46 億美元，主要是由於我們的加工業務和工廠的需求疲軟。第三季度，我們的工廠系統遭受了約 55,000 噸的經濟停機，因為我們的主要加工業務每天的產量下降了近 10%。

The continued low volume environment, combined with rising OCC costs during the quarter, led to both EBITDA dollars and EBITDA margin compression compared to prior year. That said, our PPS team utilized the same playbook as GIP in reference to value over volume and cost elimination, resulting in a still healthy 7.4% EBITDA margin for the quarter.

持續的低產量環境，加上本季度 OCC 成本上升，導致 EBITDA 美元和 EBITDA 利潤率與上年相比均壓縮。也就是說，我們的 PPS 團隊在價值超過數量和成本消除方面採用了與 GIP 相同的策略，導致本季度 EBITDA 利潤率仍然保持在 7.4% 的健康水平。

Our PPS team is managing the business very well against multiple headwinds, and I'm proud of their results and continued dedication during these challenging times. I will now turn the presentation over to Larry on Slide 8.

我們的 PPS 團隊在克服多重不利因素的情況下很好地管理了業務，我為他們在這些充滿挑戰的時期所取得的成果和持續的奉獻精神感到自豪。我現在將幻燈片 8 上的演示文稿交給 Larry。

Thank you, Ole. As Ole and I mentioned in earlier prepared remarks, our team is executing well in a historically challenging demand environment. It is an enterprise-wide effort to deliver these results, and my heartfelt thanks goes out to each department within Greif for delivering for our customers and our shareholders this year.

謝謝你，奧萊。正如奧萊和我在之前準備的發言中提到的那樣，我們的團隊在歷史上充滿挑戰的需求環境中表現良好。實現這些成果需要整個企業的努力，我衷心感謝格瑞夫的每個部門今年為我們的客戶和股東帶來的成果。

Back to the Q3 financials. Sales decreased approximately $290 million year-over-year, primarily due to lower volumes and the impact of significantly lower steel costs. Despite this, adjusted EBITDA declined less than $25 million, leading to over 150 basis points of margin expansion. Most impressive, however, was our free cash flow performance.

回到第三季度的財務數據。銷售額同比減少約 2.9 億美元，主要是由於銷量減少以及鋼鐵成本大幅下降的影響。儘管如此，調整後的 EBITDA 下降了不到 2500 萬美元，導致利潤率擴張超過 150 個基點。然而，最令人印象深刻的是我們的自由現金流表現。

Cash flow dollars were down only $8 million year-over-year on substantially higher free cash flow conversion. Just to remind everyone, Q3 of last year was the highest third quarter cash flow in the history of our company and we missed it this quarter by only $8 million with $290 million lower sales.

由於自由現金流轉換大幅提高，現金流量同比僅下降 800 萬美元。只是提醒大家，去年第三季度是我們公司歷史上最高的第三季度現金流，而本季度我們僅落後 800 萬美元，銷售額減少了 2.9 億美元。

Volume is down nearly 15% year-over-year, higher CapEx and $11 million of higher interest costs related to higher rates in our recent M&A activity. That's truly outstanding. To put it another way, on a trailing 12-month basis, our adjusted free cash flow is tracking at $580 million more than double the average annual free cash flow generated between our 2019 and 2021 fiscal years.

交易量同比下降近 15%，資本支出增加，並且與我們近期併購活動利率上升相關的利息成本增加了 1100 萬美元。這確實非常出色。換句話說，在過去 12 個月的基礎上，我們調整後的自由現金流達到 5.8 億美元，是 2019 年至 2021 財年期間產生的平均年度自由現金流的兩倍多。

On any measure, the cash output of this company is miles ahead of where it once was and we still do not believe that, that fact is fully recognized by the market. We have raised the bar on performance and the elevated cash flow dynamic has opened up a lot of possibilities for further value creation through M&A and returning cash to shareholders.

無論以何種標準衡量，該公司的現金產出都遠遠超出了以前的水平，但我們仍然不相信這一事實得到市場的充分認可。我們提高了業績標準，現金流量的增加為通過併購和向股東返還現金進一步創造價值提供了很多可能性。

And now I'd like to touch on our other capital allocation priorities on Slide 9 before discussing guidance. Ole discussed the recent acquisition of ColePak in his remarks. We're pleased to be taking another step on our Investor Day commitment to grow downstream integration in our paper system. At the same time, we're pursuing our resin-based acquisition path in GIP.

現在，在討論指導意見之前，我想先談談幻燈片 9 上的其他資本配置優先事項。索爾斯克亞在講話中討論了最近收購 ColePak 的事情。我們很高興在投資者日承諾上又邁出了一步，即加強造紙系統的下游整合。與此同時，我們正在 GIP 中尋求基於樹脂的收購途徑。

We have spent over $550 million on M&A over the last 9 months, but our work is not done and our pipeline remains robust. We expect to continue generating sufficient cash to fund various actionable opportunities and still maintain a strong balance sheet. In addition to pursuing inorganic growth, I'm excited to announce we are again raising our dividend, fulfilling our commitment we made to investors over a year ago. While our dividend yield may no longer be industry-leading, thanks to some long overdue appreciation in our stock price, it is still one of the most compelling dividend offerings in our industry.

過去 9 個月，我們在併購上花費了超過 5.5 億美元，但我們的工作尚未完成，我們的渠道仍然強勁。我們預計將繼續產生足夠的現金來資助各種可行的機會，並仍然保持強勁的資產負債表。除了追求無機增長之外，我很高興地宣布，我們將再次提高股息，履行我們一年多前對投資者做出的承諾。儘管我們的股息收益率可能不再處於行業領先地位，但由於我們的股價早該升值，它仍然是我們行業中最引人注目的股息發行之一。

By raising our dividend for the coming year by 4%, we are reaffirming our commitment to deliver cash directly back to our shareholders. As our business grows, we expect to grow our dividend at a commensurate rate to ensure shareholders are fairly compensated for their commitment to us. And finally, as you recall, last quarter, we completed our $150 million share repurchase program.

通過將明年的股息提高 4%，我們重申了直接向股東返還現金的承諾。隨著我們業務的增長，我們期望以相應的速度增加股息，以確保股東因其對我們的承諾而得到公平的補償。最後，正如您所記得的，上個季度，我們完成了 1.5 億美元的股票回購計劃。

And while we are not executing on any current buyback programs we retain an open authorization for 2.6 million shares and may execute further repurchases opportunistically in the coming years. With that, I'd like to close by discussing our revised guidance on Slide 10.

雖然我們目前沒有執行任何回購計劃，但我們保留了 260 萬股股票的公開授權，並可能在未來幾年趁機執行進一步的回購。最後，我想討論一下我們對幻燈片 10 的修訂指南。

As you can see, the midpoint of our guidance for EBITDA and free cash flow remains unchanged. Given the closer line of sight to full year results, we are tightening the range by $10 million on each side and now expect full year EBITDA to land between $790 million and $820 million and full year free cash flow between $400 million and $430 million.

正如您所看到的，我們對 EBITDA 和自由現金流的指導中值保持不變。鑑於距離全年業績更近，我們將各方面的範圍縮小1000 萬美元，現在預計全年EBITDA 將在7.9 億至8.2 億美元之間，全年自由現金流將在4 億至4.3 億美元之間。

Our overall third quarter financial results largely met our expectations. However, the individual drivers differ. Volumes were below plan in nearly all substrates, but margins were better for the reasons previously mentioned. As with prior quarters, our current forward guidance assumes no improvement on volumes through the end of the year. Additionally, we will plan to share our views on fiscal '24 in our Q4 call in early December.

我們第三季度的整體財務業績基本符合我們的預期。然而，各個驅動程序有所不同。幾乎所有基材的銷量都低於計劃，但由於前面提到的原因，利潤率更好。與前幾個季度一樣，我們當前的前瞻性指引假設到年底銷量沒有改善。此外，我們計劃在 12 月初的第四季度電話會議上分享我們對 24 財年的看法。

We expect to finish the year with another quarter of strong performance despite the persistent macroeconomic challenges we face. I'd like to remind everyone that the midpoint of our guidance range implies the best -- second best financial performance in Greif's 145-year history surpassed only by a record year in 2022. We are confident that we've set a new bar for performance and expect that we will continue to deliver these exceptional results as we make future progress on our Build to Last journey.

儘管我們面臨持續的宏觀經濟挑戰，但我們預計今年將以另一個季度的強勁表現結束。我想提醒大家，我們的指導範圍的中點意味著格瑞夫 145 年曆史上最好的——第二好的財務業績，僅在 2022 年創紀錄的一年超越。我們有信心，我們已經為性能，並期望隨著我們在“基業長青”之旅中取得未來進展，我們將繼續提供這些卓越的成果。

Ole, I'll hand it back to you to close on Slide 11.

Ole，我會將其交還給您以在幻燈片 11 上結束。

Thanks, Larry. As Larry just mentioned, our guidance reflects the expectation of the second best year in Greif's 145-year history, and we are extremely proud to be in that position considering the headwinds we have and are facing. Great companies often prove their worth in times of great difficulty through perseverance, grits and dedication to excellence. Built on Last is how we demonstrate that perseverance and I see it daily in the passion of our colleagues and decision-making at every level of our business. We are well positioned for a demand rebound whenever that comes.

謝謝，拉里。正如拉里剛才提到的，我們的指導反映了格瑞夫 145 年曆史上第二好的一年的預期，考慮到我們所面臨的逆風，我們非常自豪能夠處於這一位置。偉大的公司往往通過堅持不懈、勇氣和對卓越的奉獻精神，在困難時期證明自己的價值。 “建立在最後”是我們展示這種毅力的方式，我每天都在同事的熱情和業務各個層面的決策中看到這一點。無論何時需求反彈到來，我們都已做好充分準備。

And in the meantime, we are excited to continue building this business and making progress on our long-term strategy. We thank you for your interest in Greif. Operator, please open the line to questions.

與此同時，我們很高興能夠繼續發展這項業務並在我們的長期戰略上取得進展。我們感謝您對格瑞夫的興趣。接線員，請打開提問線路。

(Operator Instructions) And our first question will come from Michael Hoffman of Stifel.

（操作員說明）我們的第一個問題將來自 Stifel 的 Michael Hoffman。

Ole and Larry, I look forward to seeing you next week in Paris and London. When we finished 2Q, I have in my notes, if I'm wrong, I accept that I'm wrong. I had my notes the cadence in the second half was going to sort of EBITDA was on track around a couple of hundred million in the 3Q and then improve modestly into 4Q to hit the midpoint.

奧勒和拉里，我期待下週在巴黎和倫敦見到你們。當我們完成 2Q 時，我在筆記中寫道，如果我錯了，我承認我錯了。我注意到下半年的節奏將在第三季度達到 EBITDA 大約幾億，然後在第四季度適度改善以達到中點。

You beat the outlook for 3Q, given your again repeated exceptional performance around cost, that has the fourth quarter down pretty healthy. How my -- what is my interpretation of the implied EBITDA being $185 million versus something that was like low $200s, $210 million originally.

鑑於您在成本方面再次重複出色的表現，您超出了第三季度的預期，這使得第四季度的下滑相當健康。我對隱含 EBITDA 為 1.85 億美元的解釋是什麼，而最初的 EBITDA 僅為 200 美元，即 2.1 億美元。

Yes, Michael, you're correct. I mean the Q3 ended up being better on the margin side, volume degradation though, was more than we expected. And we don't see that volume picking up. And we've seen ag perform less favorable than we normally do. So with that trend, it just shifted things a bit.

是的，邁克爾，你是對的。我的意思是，第三季度最終在利潤方面表現更好，儘管銷量下降，但超出了我們的預期。我們沒有看到銷量有所增加。我們發現農業的表現不如平時。因此，隨著這種趨勢，它只是改變了一些事情。

We also had anticipated that we would have some -- a tax refund item that is in Latin America like $6 million. We had anticipated that might occur later. It came into the third quarter, is actually a noncash item as well, which really impacted cash flow a little bit. But it's really those 2 items. Obviously, we hope volumes will pick up and surprise us a bit in the fourth quarter, but we have not seen that in August yet.

我們還預計我們會有一些——拉丁美洲的退稅項目，大約 600 萬美元。我們預料到這種情況可能會稍後發生。它進入第三季度，實際上也是一個非現金項目，這確實對現金流產生了一點影響。但這確實是那兩個項目。顯然，我們希望第四季度的銷量會有所回升並給我們帶來一些驚喜，但我們在八月份還沒有看到這一點。

Okay. And then to that point, we've talked before about sort of major end markets and GIP, sort of chemical paints and coatings and lubricants. So are we hearing a message that it's not worse, it's just not any better. Or has some of those got worse?

好的。就這一點而言，我們之前已經討論過主要終端市場和 GIP，即化學油漆、塗料和潤滑劑。那麼我們是否聽到這樣的信息：情況並沒有更糟，只是沒有更好。或者其中一些變得更糟了？

Michael. We -- our customers are telling us that it's not getting worse, but they're also telling us that they don't expect any improvements over the next 2 quarters. So from what we hear, we will be in the second quarter of 2024 before they're seeing even any remote chance of improvements. So that's what we hear from our customers.

邁克爾.我們的客戶告訴我們，情況並沒有變得更糟，但他們也告訴我們，他們預計未來兩個季度不會有任何改善。因此，據我們所知，要到 2024 年第二季度，他們才會看到哪怕是微乎其微的改進機會。這就是我們從客戶那裡聽到的。

Okay. And then on PPS, I cover things that recycle all this OCC and that into my coverage says that they're starting to see improving demand. So is there a light at the end of the tunnel and all of this -- the finished goods inventory clearing and demand starts to improve?

好的。然後在 PPS 上，我報導了回收所有 OCC 的內容，並且在我的報導中表明他們開始看到需求的改善。那麼，隧道盡頭是否有曙光，所有這一切——成品庫存清理和需求開始改善？

Yes, Mike, we're -- I think part of what's created a little bit of demand on the waste companies for the OCC side of things is really just related to some new mill capacity opening and recycled mills. Outside of that, we're not -- we saw a couple -- times over the last month or so where we saw a spike in orders for a week, but then the next week, they fell back off. So we haven't seen anything sustained that would indicate any lift, and we're not hearing anything from our customers in the paper business that gives them any real solid indications of an inflection point.

是的，邁克，我們 - 我認為對 OCC 方面的廢物公司產生一點需求的部分原因實際上只是與一些新工廠產能開放和回收工廠有關。除此之外，在過去一個月左右的時間裡，我們並沒有看到幾次訂單在一周內激增，但在下週，訂單量有所回落。因此，我們沒有看到任何持續的跡象表明任何提振，我們也沒有從造紙行業的客戶那裡聽到任何關於拐點的真正可靠的跡象。

But it sounds like you feel like you have hit a bottom. If you're getting momentary spikes, you'll probably hit a bottom.

但聽起來你感覺自己已經觸底了。如果出現短暫的峰值，您可能會觸底。

Yes, we hope so. I mean, we think that, but we thought the second half of this fiscal year would be good, and I missed that call. So I'm not really good with my crystal ball.

是的，我們希望如此。我的意思是，我們認為，但我們認為本財年下半年會很好，但我錯過了那個電話。所以我不太擅長使用我的水晶球。

Yes. You and I both. And then last one for me is why not own 100% of Cole.

是的。你和我都。最後一個對我來說是為什麼不擁有科爾 100% 的股份。

We -- this is a deal that because of our long relationship with them, they approached us to help because of growth opportunities. But maybe I'll let Matt talk a little bit about that because Matt leads our business development efforts and dealt with the Cole family on this.

我們——由於我們與他們的長期關係，他們因為增長機會而向我們尋求幫助，這是一項交易。但也許我會讓馬特談談這一點，因為馬特領導我們的業務發展工作，並就此與科爾家族打交道。

Yes. So Michael, the reason to not own 100% is that we and the Cole's believe that there is substantial growth opportunity ahead. And we want to have aligned incentives as we try to grow that business together. Part of the partnership, the reason it makes sense is because they see real opportunities in the market to grow substantially, but they need to make sure they have the mill capacity to do it. So that's the strategic rationale. We're excited about adding into the portfolio from a margin perspective -- from an end market perspective, but I also think that, that 51% ownership stake and partnership going forward makes sense for both of us to maximize the growth and value creation of that business over time.

是的。所以邁克爾，不100%持有的原因是我們和科爾相信未來有巨大的增長機會。當我們努力共同發展業務時，我們希望有一致的激勵措施。作為合作夥伴關係的一部分，其有意義的原因是他們看到了市場上大幅增長的真正機會，但他們需要確保他們有工廠能力來做到這一點。這就是戰略理由。我們很高興從利潤率角度（從終端市場的角度）加入到投資組合中，但我也認為，51% 的所有權和未來的合作夥伴關係對於我們雙方來說都是有意義的，可以最大限度地實現增長和價值創造隨著時間的推移，這項業務。

Yes. And they're highly respected in the industry because of sort of their word is their bond kind of thing. They're good people. They're Ohio people, and they want to participate in the growth.

是的。他們在業界備受尊敬，因為他們的言行就是他們的紐帶。他們是好人。他們是俄亥俄州人，他們希望參與發展。

(Operator Instructions) Our next question will come from the line of Ghansham Panjabi of Baird.

（操作員說明）我們的下一個問題將來自 Baird 的 Ghansham Panjabi。

I know it's very difficult to disaggregate. But on the volume decline in GIP, how would you separate end market weakness versus any incremental destocking at the customer level? And I'm just asking that because as raw material prices started to decline for some of your customers, they did start to accelerate destocking and just kind of wondering where we are in that phase.

我知道分解起來非常困難。但在 GIP 銷量下降的情況下，您如何區分終端市場疲軟與客戶層面的增量去庫存？我只是問這個問題，因為隨著一些客戶的原材料價格開始下降，他們確實開始加速去庫存，只是想知道我們處於這個階段的哪個階段。

It's Ole. We don't think that destocking has come to an end, but it's difficult just to see whether it's really come to an end, but we believe what we see now is really there's a manifestation of extremely low demand in the markets, if that's helpful.

是奧萊。我們不認為去庫存已經結束，但很難判斷它是否真的結束，但我們相信我們現在看到的情況確實是市場需求極低的表現，如果這有幫助的話。

Got it. And then in terms of the margin improvement in GIP, which has been obviously very notable in the context of the volume declines you've cited, how should we think about incrementals as volumes eventually recover? And I'm just asking because are there any big cost reversal headwinds we should keep in mind in that scenario?

知道了。然後就 GIP 的利潤率改善而言，在您提到的銷量下降的背景下，這顯然非常顯著，隨著銷量最終恢復，我們應該如何考慮增量？我只是問，因為在這種情況下我們應該牢記任何巨大的成本逆轉阻力嗎？

Well, obviously, on that side, we've taken a lot of cost outs, some of it is structural. We've done rooftop consolidations. We also are able to in that business to flex really, really rapidly as demand goes down. So if you -- if demand returns, we obviously have room to -- we can increase our capacity, let's say, 2% to 5% without any cost increases. But if demand goes up further than that, you would have to add shifts. So you will see variable cost goes up in line with increased demand. But a lot of the costs we've taken out is structural.

嗯，顯然，在這方面，我們已經削減了很多成本，其中一些是結構性的。我們已經完成了屋頂整合。隨著需求下降，我們還能夠在該業務中非常非常迅速地進行調整。因此，如果需求回升，我們顯然還有空間——我們可以在不增加任何成本的情況下增加產能，比如說 2% 到 5%。但如果需求進一步增加，你就必須增加班次。因此，您會看到可變成本隨著需求的增加而增加。但我們削減的很多成本都是結構性的。

Got it. And then just one final one on ColePak. If you broke out the sales number, I missed that, so if you could please repeat that. And then also as it relates to fiscal year '24, I mean, obviously, very early big range of outcomes just based on the macro complexity, et cetera. But can you give us some of the known variances that we should keep in mind as we finalize our modeling estimates for fiscal year '24. You have ColePak, obviously, the EBITDA contribution from there, any flow-through from cost savings, price declines in paper? Anything you could share there.

知道了。然後是 ColePak 上的最後一篇。如果你列出了銷售數字，我錯過了，所以如果可以的話請重複一遍。然後，由於它與 24 財年相關，我的意思是，顯然，非常早期的大範圍結果只是基於宏觀複雜性等。但是，您能否告訴我們一些在我們最終確定 24 財年的建模估計時應牢記的已知差異。顯然，你有 ColePak，來自那裡的 EBITDA 貢獻，成本節約、紙張價格下降帶來的任何流量？任何你可以在那里分享的東西。

Yes, Ghansham, this is Matt. On ColePak, we didn't give a revenue number, but EBITDA -- run rate EBITDA is about $17 million, $18 million. And then that does not include kind of the incremental benefits that go to the mills from us absorbing more tons. And you can think about that on a full year run rate basis. We're not going to give revenue right now around margins, but that should be instructive as you build a model for next year.

是的，甘沙姆，這是馬特。在 ColePak 上，我們沒有給出收入數字，但 EBITDA——運行率 EBITDA 約為 1700 萬美元、1800 萬美元。這還不包括我們吸收更多噸給工廠帶來的增量收益。您可以根據全年運行率來考慮這一點。我們現在不會根據利潤率給出收入，但這對於您構建明年的模型應該具有指導意義。

On the other components, you can add a portion of the contribution from Lee, a couple of months a portion from Centurion. And then obviously, this when you think about next year from an M&A basis. And then in terms of the other cost elements, I don't know, you were asking for thinking about next year. I don't know if we really have that.

在其他組件上，您可以添加 Lee 的一部分貢獻，以及 Centurion 幾個月的貢獻。顯然，當你從併購的角度考慮明年時就會出現這種情況。然後就其他成本要素而言，我不知道，您要求考慮明年。我不知道我們是否真的有這個。

Yes, I would just say that on the M&A side -- between Lee, Centurion and ColePak, we probably have $40 million of incremental revenue this year. We take out 2 maybe on the Tama things that we're up net $38 million. And if you look at the numbers we provided on each of those, you had $33 million for Lee, $20 million for Centurion and $17 million on ColePak on a full year basis. So you'd have a lift of maybe $28 million next year, $30 million kind of number. And then on the cost takeouts, we haven't quantified the rooftop consolidation piece.

是的，我只想說，在 Lee、Centurion 和 ColePak 之間的併購方面，我們今年可能會增加 4000 萬美元的收入。我們可能在 Tama 的事情上拿出了 2 個，我們淨賺了 3800 萬美元。如果你看一下我們提供的每項數據，你會發現 Lee 全年收益為 3300 萬美元，Centurion 收益為 2000 萬美元，ColePak 收益為 1700 萬美元。所以明年你可能會增加 2800 萬美元，大約 3000 萬美元。然後在成本支出方面，我們還沒有量化屋頂整合部分。

There's obviously some permanent cost they got there. On structural over time, we've taken out a significant number this year, call it, roughly $30 million of overtime. Some of that's a shift in volume related, but we think there's somewhere $10 million to $13 million of permanent structural change in how we're running the business.

顯然他們在那裡付出了一些永久性的代價。在結構性加班方面，今年我們已經支出了大量的加班費，大約為 3000 萬美元。其中一些與銷量的變化有關，但我們認為我們的業務運營方式存在 1000 萬至 1300 萬美元的永久性結構性變化。

(Operator Instructions) Our next question will come from George Staphos of Bank of America.

（操作員指令）我們的下一個問題將來自美國銀行的喬治·斯塔福斯（George Staphos）。

Congratulations on the performance. I wanted to -- a lot of the questions have already sort of gotten at the heart of the matter for you and again, what was really, really good performance in light of things. When you're talking to your customers Ole, what are they saying about why they believe demand isn't lifting it? Again, I know that's really, really hard to quantify you cover so many markets and so many customers. But is there a common denominator 1 or 2 things that they're seeing in terms of why we're not seeing demand lift downstream?

恭喜你的表現。我想——很多問題已經成為你們問題的核心，再一次，從事情的角度來看，什麼是真正非常好的表現。當你與你的客戶 Ole 交談時，他們對為什麼他們認為需求沒有提升它有什麼看法？再說一遍，我知道要量化覆蓋如此多的市場和如此多的客戶真的非常非常困難。但是，他們所看到的一兩件事是否有共同點來解釋為什麼我們沒有看到下游需求的提升？

Yes. So first of all, when I speak to a lot of them, our big global customers, they've taken plants down. They've taken a lot of economic downtime. It's really back to what we have discussed previously that the economy has shifted from buying things to going out and consumers spending their money on services instead. I saw recently a couple of articles from the big-box retailers in terms of how they're suffering that's the closest I can get. And then in terms of just the interest rates, people are not moving out as they have been means that they don't buy goods when they move houses, they don't necessarily paint and that sort of thing. So -- but to put my finger on one particular item, it's really, really difficult.

是的。首先，當我與他們中的很多人（我們的全球大客戶）交談時，他們已經關閉了工廠。他們經歷了很長時間的經濟停頓。這真的回到了我們之前討論的，經濟已經從買東西轉向外出，消費者把錢花在服務上。我最近看到了幾篇來自大型零售商的文章，內容是我所能得到的最接近的關於他們如何遭受苦難的文章。然後就利率而言，人們不會像以前那樣搬出去，這意味著他們搬家時不會購買商品，他們不一定會油漆之類的東西。所以——但是要具體說一件事情，真的非常非常困難。

Understood. And on the ag side, you said ag is maybe trending a little bit less positive than you normally would like to anything to take away from that?

明白了。在農業方面，你說農業的趨勢可能比你通常希望的要少一些？

Yes. What I've been told also on ag is that in times of hardship, what the individual farmers tend to do is to use less fertilizer and less (inaudible) that sort of thing. It's just part of managing their business.

是的。關於農業，我還被告知，在困難時期，個體農民往往會做的是少用化肥和少用（聽不清）之類的東西。這只是管理他們業務的一部分。

Understood. Understood. Can you talk about what price cost benefit you might have gotten from steel in the fiscal third and what you might be expecting in the fiscal fourth? And then back to Ghansham's earlier question. So should we take away that as things ultimately hopefully pick up, there's maybe $20 million of costs that will come back into the business on an annualized basis.

明白了。明白了。您能否談談您在第三財年可能從鋼鐵中獲得的價格成本效益以及您在第四財年可能獲得的價格成本效益？然後回到甘沙姆之前的問題。因此，如果我們排除這一點，隨著情況最終有望好轉，每年可能會有 2000 萬美元的成本重新回到業務中。

George. Yes, there is a slightly better situation. We had it on a year-over-year basis on steel because last year, we had a rapidly decreasing steel cost curve. So we had higher inventory walking through but it was not material for the quarter. As to that $20 million, the differential on that overtime number I mentioned, yes, it will come back, but that only comes back with sales, and that would be leveraging our fixed cost footprint because we aren't building new factories to get that. So it will be adding labor back, but it won't be adding anything on depreciation and other costs that go in. So still nice margin lift.

喬治。是的，還有一個稍微好一點的情況。我們的鋼鐵成本同比增長，因為去年我們的鋼鐵成本曲線迅速下降。因此，我們的庫存量較高，但對於本季度來說並不重要。至於那2000 萬美元，我提到的加班費的差異，是的，它會回來，但這只會隨著銷售而回來，這將利用我們的固定成本足跡，因為我們不會建造新工廠來實現這一點。因此，它將增加勞動力，但不會增加任何折舊和其他成本。因此，利潤率的提升仍然不錯。

I get that, just in terms of when we do our stack, we need to make sure that we have kind of a small negative slice for the 20 is what I'm getting after volume after incremental margins and so on.

我明白了，就我們進行堆棧而言，我們需要確保我們在 20 的數量上有一個小的負切片，這就是我在增量利潤等之後得到的數量。

George, it's important to mention, those costs don't come back at the same rate sales do. So it's not a one-to-one relationship. Demand improves, sales dollars improve, costs come right back in. They come back a lot more slowly. And there's a lot of kind of slack capacity just that we have in our system right now on existing shifts. So we can handle more demand and an inflection without layering in incremental cost right away. But over time, as sales come back, that's a good problem to solve that as demand improve.

喬治，值得一提的是，這些成本的回報率與銷售額的回報率不同。所以這不是一對一的關係。需求改善，銷售收入改善，成本立即回升。但回升速度要慢得多。我們的系統中現有班次中存在大量閒置產能。因此，我們可以處理更多的需求和變化，而無需立即增加增量成本。但隨著時間的推移，隨著銷量的回升，隨著需求的改善，這是一個很好的解決問題。

Yes, that's what Ole was mentioning. If you go up 2% to 3%, we don't have pad a dime, you go up 20% after had a shift or something...

是的，奧萊就是這麼說的。如果你漲2%到3%，我們一毛錢都沒有，換班什麼的之後你就漲20%……

And George just a final comment on that. Just a final comment on that. I'll just go back to our strategy of value over volume, we will not take on business. So we are running at, I won't say full capacity, but healthy capacity utilization in all our facilities. We will not take on business with low margins and then adds cost in our plants in terms of another shift to produce products that we make low margins on. That's not our strategy.

喬治對此只是最後的評論。只是對此的最後評論。我將回到我們的價值高於數量的策略，我們不會接受業務。因此，我不會說我們的全部產能，而是我們所有設施的健康產能利用率。我們不會接受低利潤的業務，然後再轉向生產低利潤的產品，從而增加工廠的成本。那不是我們的策略。

No, makes sense, Ole. My last question, and I'll turn it over. same theme in terms of okay, let's get on the other side of the mountain and volumes are better and so on, we're hopefully a better '24.

不，有道理，奧萊。我的最後一個問題，我會翻過來的。相同的主題，好的，讓我們到山的另一邊，銷量會更好等等，我們希望有一個更好的 24 年。

Free cash flow conversion has been excellent this year, well above your goal in the last quarter. Is there a chance that maybe realizing you're not going to guide on '24 that the conversion in '24 maybe is a little below 50% because you do have to add back to working capital, you do have to do some other things or no? And then tell me a little bit about the program that you're offering your employees to buy stock at a discount. What did you compare that with in terms of other ways to incentivize performance and ownership?

今年的自由現金流轉換非常出色，遠高於上季度的目標。是否有可能意識到您不會在 24 年進行指導，24 年的轉化率可能略低於 50%，因為您確實必須添加回營運資金，您確實必須做一些其他事情或不？然後告訴我一些有關您為員工提供的以折扣價購買股票的計劃的信息。您將其與其他激勵績效和所有權的方式進行比較？

Yes. So two things on that. I mean, it's all going to depend on the pace of the increase of demand, George. And also then where does the cost of steel end up is the big driver for us in terms of what will be the impact on working capital build. OCC will play into that as well. Obviously, if demand comes back, you would think that's going to drive steel cost up in OCC. But we would still have our goal to be 50% or better.

是的。所以有兩件事。我的意思是，這一切都取決於需求增長的速度，喬治。此外，就對營運資本建設的影響而言，鋼鐵成本最終會在哪裡成為我們的主要驅動力。 OCC 也將參與其中。顯然，如果需求回升，您可能會認為這將推高 OCC 的鋼鐵成本。但我們的目標仍然是 50% 或更高。

And we have other opportunities within our supply chain initiatives that we believe can keep us at that -- our goal level. So that will be our focus. I mean, obviously, the outsized performance that we had this quarter is substantially above our goal. We would love that, but we don't see that.

我們的供應鏈計劃中還有其他機會，我們相信這些機會可以讓我們保持在我們的目標水平。這將是我們的重點。我的意思是，顯然，我們本季度的出色表現大大高於我們的目標。我們會喜歡這樣，但我們沒有看到這一點。

But just for another example, ColePak is well above our 50% on free cash flow conversion. And we're trying to focus on those type of businesses as we execute on our M&A strategy in both the resin business and also in the downstream in our paper business. With respect to the Stock Purchase Plan for our colleagues, this actually emanated from requests from our employees.

但再舉一個例子，ColePak 的自由現金流轉換率遠高於我們的 50%。當我們在樹脂業務和下游造紙業務中執行併購戰略時，我們正在努力專注於這些類型的業務。至於我們同事的股票購買計劃，這實際上是我們員工的要求。

We had a number of requests as we went around to plants around the world from probably colleagues who had worked at other places that had this and they said, "Hey, look, we really like what's going on in the company? Could we entertain something like this. And so we presented to the Board, they approved it. We had good take-up in the first initial quarter of application and have had really nice feedback from our colleagues. So we look forward to it growing from here.

當我們前往世界各地的工廠時，我們收到了很多請求，這些請求可能來自曾在其他地方工作過的同事，他們說：“嘿，看，我們真的很喜歡公司正在發生的事情？我們可以招待一些東西嗎？”像這樣。所以我們向董事會提交，他們批准了。我們在申請的第一個季度就得到了很好的採用，並且從我們的同事那裡得到了非常好的反饋。所以我們期待它從這裡開始發展。

Was there any sort of discussion about -- like what kind of discount are you giving your employees to buy the stock, right? Others would like a discount to in the market but...

是否有任何形式的討論 - 比如您給員工購買股票提供什麼樣的折扣，對吧？其他人希望在市場上有折扣，但是......

Yes, it's a 15% discount which is pretty standard in these programs.

是的，這是 15% 的折扣，這在這些計劃中是相當標準的。

(Operator Instructions) Our next question will come from Gabe Hajde of Wells Fargo.

（操作員說明）我們的下一個問題將來自富國銀行的 Gabe Hajde。

I'm curious, and again, a lot of ground has been covered and it's challenging to answer a question like this. But from a competitive landscape standpoint, more specifically thinking about the more mature markets in North America and Europe, do you believe that we've seen sort of higher cost of capital manifest in different pricing behavior or competitive activity in the markets in which you participate? Or is that something that we still think is on the comp would be my first question.

我很好奇，再說一次，已經涵蓋了很多基礎知識，回答這樣的問題很有挑戰性。但從競爭格局的角度來看，更具體地考慮北美和歐洲更成熟的市場，您是否認為我們已經看到較高的資本成本體現在您參與的市場的不同定價行為或競爭活動中？或者說，我們仍然認為在比賽中存在的東西將是我的第一個問題。

That said -- yes. I don't know that we would necessarily attribute competitive behavior to their cost of capital, although obviously, in our GIP business, one of our primary competitors is very highly levered. So it does put pressure on them, but think it puts pressure in the right direction. So that's a good thing.

也就是說——是的。我不知道我們一定會將競爭行為歸因於他們的資本成本，儘管顯然，在我們的 GIP 業務中，我們的主要競爭對手之一的槓桿率非常高。所以這確實給他們帶來了壓力，但我認為這給了正確的方向壓力。所以這是一件好事。

I mean, the more -- the place where we're seeing that really play out more is in our strategic M&A activities. I mean it's clearly put the PE model in a much different position than they were 2 or 3 years ago and puts us in a very, very good position relative to what we're trying to do in the market.

我的意思是，我們看到真正發揮更多作用的地方是我們的戰略併購活動。我的意思是，這顯然使 PE 模式處於與兩三年前截然不同的位置，並且相對於我們在市場上嘗試做的事情，使我們處於非常非常好的位置。

So no, that's not exactly responsive to what your question was, Gabe. But we see the favorability there. We're not seeing anything in the competitive marketplace that I would attribute to their cost of capital, at least that we could discern.

所以不，這並不能完全回答你的問題，加布。但我們看到了那裡的好感。在競爭激烈的市場中，我們沒有看到任何我將其歸因於他們的資本成本的東西，至少我們可以看出。

Sure. Well, no, I maybe ask the question a little bit better. In a down demand environment would be just intuitively how you would think about competitors coming out and maybe being a little bit more aggressive to pick up business and keep share. Are you seeing that? Or again, it kind of seems like based on your results, the answer is no. And the fact that you're able to price for value.

當然。好吧，不，我也許問這個問題更好一點。在需求下降的環境中，您會直觀地看到競爭對手的出現，並且可能會更加積極地獲取業務並保持份額。你看到了嗎？或者，根據你的結果，答案似乎是否定的。事實上，您能夠根據價值定價。

Gabe, I can give you a crystal clear yes to that.

加布，我可以明確地告訴你“是”。

Okay. All right. And then I guess just one last one. Appreciating that there's some math behind it, but you made a pretty strong statement that still sounds like you're going to be out doing some M&A. The pipeline is pretty full. Is there a point at which share repurchase becomes more compelling than maybe deploying capital on the M&A side? Or is it not a binary decision like that from a, I guess, mathematical return standpoint?

好的。好的。然後我想只有最後一個。我很欣賞這背後有一些數學原理，但你做出了一個非常強有力的聲明，聽起來仍然像是你將進行一些併購。管道已經很滿了。股票回購是否會在某個時刻變得比在併購方面部署資本更有吸引力？或者，我猜，從數學回報的角度來看，這不是一個二元決定嗎？

Yes, I don't think it's binary, I guess. If we found that we could not deploy capital in attractive M&A along our strategic objectives, then it would become more compelling to start buying shares back because we continue to believe our shares are phenomenally undervalued. I think our multiples are stupid low.

是的，我想我不認為它是二進制的。如果我們發現我們無法根據我們的戰略目標將資本部署到有吸引力的併購中，那麼開始回購股票將變得更有說服力，因為我們仍然相信我們的股票被嚴重低估。我認為我們的倍數太低了。

But that said, the M&A deals we are doing, the returns that we've got forecast are quite compelling. And to the extent that we continue to have those type of opportunities, we will go down that path. I mean I don't remember if Matt talked about this. I mean the ColePak deals at 8x and then after synergies that we'll get from integration price is 6.

但話雖如此，我們正在進行的併購交易以及我們預測的回報是相當引人注目的。只要我們繼續擁有此類機會，我們就會走這條路。我的意思是我不記得馬特是否談過這個。我的意思是 ColePak 的交易價格是 8 倍，然後我們從整合中獲得的協同效應是 6 倍。

So if we can do deals like that, that are high margin, high cash flow conversion at those kind of multiples, we'll be doing that for a long time before we do a lot of capital on stock repurchase. But if we can't, then we'll go the other way. And these are not mutually exclusive. Like I said, we will be doing some stock repurchase stuff opportunistically over the next year as well.

因此，如果我們能夠進行這樣的交易，即以這種倍數實現高利潤、高現金流轉換，那麼我們將在很長一段時間內這樣做，然後再投入大量資金進行股票回購。但如果我們做不到，那麼我們就會走另一條路。而且這些並不是相互排斥的。就像我說的，我們也將在明年機會主義地進行一些股票回購。

Okay. Last one for me. I know George was pushing that working capital a little bit. CapEx has been elevated over the past 2 years. I think I read some articles over the past week or so that you guys made some investments at the Riverville Mill in Virginia. At least from a planning budgeting standpoint on the CapEx side, Larry, is that -- can you give us a ballpark of that maybe it's in that $160 million range or something like that, were you expecting to be down from where we are this year? Or are you seeing enough opportunities in the pipeline organically where you might have $180 million to $200 million of CapEx next year?

好的。最後一張給我。我知道喬治正在推動一點營運資金。過去兩年資本支出有所上升。我想我在過去一周左右讀過一些文章，你們在弗吉尼亞州的 Riverville Mill 進行了一些投資。拉里，至少從資本支出方面的規劃預算角度來看，您能否給我們一個大概的數字，也許是在1.6 億美元的範圍內，或者類似的數字，您是否預計我們今年的支出會有所下降？ ？或者您是否在管道中有機地看到了足夠的機會，明年您可能有 1.8 億至 2 億美元的資本支出？

I think the levels we've been running the last couple of years or something, I would continue to model in. I think we've got opportunities including our whole effort around digitization. I mean, we believe that there's going to be substantive returns from us digitizing more and becoming much more customer friendly. So we've got the opportunity to deploy capital in areas that we believe will return well for us. So I think that level is good for your modeling purposes.

我認為我們過去幾年所達到的水平或其他水平，我將繼續建模。我認為我們有機會，包括我們圍繞數字化所做的全部努力。我的意思是，我們相信，我們進一步數字化並變得對客戶更加友好，將會帶來實質性的回報。因此，我們有機會將資本部署到我們認為會給我們帶來良好回報的領域。所以我認為這個級別非常適合您的建模目的。

(Operator Instructions) Our next question is a follow-up from Michael E. Hoffman of Stifel.

（操作員說明）我們的下一個問題是 Stifel 的 Michael E. Hoffman 的後續問題。

I just want to make sure I understood the one answer. The unequivocal yes is the yes, the customers -- or the competitors are being disciplined or yes, they're being -- they're acting badly.

我只是想確保我理解唯一的答案。明確的是，是的，客戶——或者競爭對手正在受到紀律處分，或者是的，他們正在——他們的行為很糟糕。

I don't know whether you call it acting badly, but are they -- I think the question is, are they being super competitive, And the answer is yes.

我不知道你是否稱其為表現不佳，但他們是——我認為問題是，他們是否具有超級競爭力，答案是肯定的。

So not irrational. If they -- otherwise.

所以並非不合理。如果他們——否則。

We've always got somebody acting irrational somewhere in the world, Michael. I mean when you've got as many plants as we do as the number of customers, there's always going to be something where some lone wolf out there is totally irrational. But as a broad answer across the customer base, no, they're not being irrational.

邁克爾，世界上的某個地方總是有人表現得不理性。我的意思是，當你的工廠數量與我們的客戶數量一樣多時，總會有一些獨行狼是完全不理性的。但作為整個客戶群的廣泛答案，不，他們並不是非理性的。

They're doing it at prices in some cases that we're not going to do because we're not going to chase the volume. Like we've said, our focus is on value and delivering the best customer service in the world and being responsive and really treating our customers well and getting paid for the value.

在某些情況下，他們的價格是我們不會做的，因為我們不會追逐數量。正如我們所說，我們的重點是價值並提供世界上最好的客戶服務，並積極響應並真正善待我們的客戶並因價值而獲得報酬。

And I said earlier, we don't need to chase volume.

我之前說過，我們不需要追逐數量。

Right. Yes. No, I applaud the action. I've seen it across other industries. And when you do that, you get the kind of results you're producing. But the other read through to this is the moment volume starts to improve, they back right off of that, so there's a snap around price as potential.

正確的。是的。不，我對這一行動表示讚賞。我在其他行業也看到過這種情況。當你這樣做時，你就會得到你正在產生的結果。但另一個解讀是，一旦成交量開始改善，他們就會立即退出，因此價格可能會出現大幅波動。

We would love to see that.

我們很樂意看到這一點。

And I'm seeing no further questions in the queue. I would now like to turn the conference back to Matt Leahy for closing remarks.

我在隊列中沒有看到更多問題。現在我想請馬特·萊希（Matt Leahy）致閉幕詞。

Thank you, everyone, for joining today. I hope you have a wonderful day.

謝謝大家今天的加入。我希望你有一個美好的一天。

This concludes today's conference call. Thank you all for participating. You may now disconnect, and have a pleasant day.

今天的電話會議到此結束。感謝大家的參與。您現在可以斷開連接，並度過愉快的一天。