Greif cites progress of business reorganization, cost cutting

• Cost-cutting results: Greif is about nine months into its plan to cut $100 million in costs through 2027. Looking at business transformation and cost reduction, “at times that work can be uncomfortable. What our people know is that is how the company grows, moves from good to great, and ultimately creates shareholder value,” said CEO Ole Rosgaard on Thursday’s fiscal third-quarter earnings call.  
• Financial results: Despite cautious consumer sentiment and a macroeconomy that is “not robust,” Rosgaard said that “from a big picture point of view, our volume performance clearly shows our strategy is working,” alluding to last year’s business unit reorganization to create four material-based sectors. Quarterly sales in the polymers unit, a new focus area for Greif, rose nearly 8% year over year, while sales for metals dipped 5.7% and fiber dropped 5.4%.
• Divestitures update: Greif’s containerboard business sale to Packaging Corporation of America is slated to close by the end of August; the companies previously said they anticipated a close by the end of the third quarter of the calendar year, Sept. 30. Meanwhile, the divestiture of Greif’s timberlands to Molpus Woodlands Group is scheduled to close Oct. 1, Rosgaard said. That’s a day later than originally planned to save $13 million in taxes, said CFO Larry Hilsheimer. Collectively, these divestitures “sharpen our portfolio to concentrate our efforts” on markets where the company has the most potential for growth and a competitive advantage, Rosgaard said.

Greif cites progress of business reorganization, cost cutting | Packaging Dive