Graphic Packaging to shut down Ohio facility in June

ATLANTA - Graphic Packaging Holding Company (NYSE:GPK), a prominent player in sustainable consumer packaging with a market capitalization of $7.79 billion, has announced the impending permanent closure of its Middletown, Ohio, paperboard manufacturing facility, anticipated on or around June 1, 2025. This move is set to impact around 130 employees and is a strategic step in the company’s broader plan to consolidate its recycled paperboard production. According to InvestingPro analysis, the company currently trades at an attractive P/E ratio of 12.03, suggesting potential value for investors watching this strategic transition.

The consolidation strategy aims to centralize operations within its Kalamazoo, Michigan, location and a new facility in Waco, Texas, which is slated to start commercial production later in the year. Graphic Packaging is committed to supporting the affected Middletown employees by providing assistance for employment placement. With annual revenue of $8.81 billion and a strong financial health score rated as "GOOD" by InvestingPro, the company appears well-positioned to execute this transition effectively.

President and CEO Michael Doss expressed gratitude towards the Middletown team for their contributions to the company’s growth and success. He also emphasized that the investments in the Kalamazoo and Waco facilities are crucial for delivering value to customers by producing the highest quality and most cost-effective paperboard in North America.

The closure of the Middletown plant is aligned with Graphic Packaging’s strategy to enhance its competitive edge in paperboard manufacturing and to improve environmental performance, particularly in water and energy efficiency.

Graphic Packaging is recognized for its innovation and operational capabilities in the sustainable consumer packaging market. The company’s commitment to reducing the environmental impact of consumer packaging is evident in its global network of design and manufacturing facilities that serve a wide array of brands in various consumer product sectors.

The company’s forward-looking statements regarding the timing of the Middletown facility closure and the commencement of operations at the Waco facility, along with expected environmental advancements, are based on current information and are subject to risks and uncertainties that could cause actual results to differ materially from expectations.

This announcement is based on a press release statement from Graphic Packaging Holding Company. The information reflects the company’s current plans and may be subject to change based on various factors, including market conditions and regulatory requirements. Currently trading near its 52-week low of $24.50, InvestingPro analysis suggests the stock may be undervalued, with analysts maintaining positive profitability forecasts for the year ahead. Discover more detailed insights and 7 additional ProTips about GPK through InvestingPro’s comprehensive research platform.

In other recent news, Graphic Packaging Holding Company reported fourth-quarter earnings that did not meet analyst expectations, with adjusted earnings per share of $0.46 falling short of the anticipated $0.62. Revenue also came in below projections at $2.1 billion, compared to the forecasted $2.16 billion. Despite these results, the company achieved an adjusted EBITDA margin of 19.1% for the full year 2024 and noted a return to positive packaging volume growth in the latter half of the year. Looking forward to 2025, Graphic Packaging anticipates earnings per share between $2.53 and $2.78, with revenue projections ranging from $8.7 billion to $8.9 billion, slightly below analyst consensus.

In related developments, Citi analyst Anthony Pettinari reduced the company’s price target to $28 from $30, maintaining a Neutral rating due to modest fourth-quarter results and 2025 EBITDA guidance that did not meet consensus expectations. Pettinari revised the 2025 EBITDA forecast to $1.705 billion, accounting for stable price and cost dynamics and performance improvements. Meanwhile, Truist Securities also adjusted its outlook, lowering the price target to $30 from $31 while keeping a Hold rating. Truist’s analysts noted potential near-term market fluctuations and revised earnings estimates downward due to softer Consumer Packaged Goods volumes.

Graphic Packaging continues to focus on sustainable packaging solutions, as highlighted during a European Packaging Innovation Field Trip attended by Truist’s analysts. The company remains committed to innovation and strategic initiatives, including launching Vision 2030 and executing a Virtual Power Purchase Agreement to boost renewable energy use in Europe. Additionally, Graphic Packaging repurchased 2% of its common shares and returned $322 million to stockholders in 2024, underscoring its dedication to shareholder returns.

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