Sonoco Products Company

Reported Q2 adjusted net sales were $1.9 billion, down 1% versus the prior year. Adjusted EBITDA was $324 million, down 1%, with adjusted EBITDA margin of 17.2% in line with last year. Adjusted EPS was $1.51 versus $1.37 a year ago, and operating cash flow was $301 million, up 56% year over year; free cash flow was $237 million, up 139%. Excluding the divested ThermoSafe businesses, prior-year Q2 results included $66 million of revenue, $11 million of EBITDA and $0.08 of EPS. For the full year, management reiterated guidance for net sales of $7.25 billion to $7.75 billion, adjusted EBITDA of $1.25 billion to $1.35 billion, adjusted EPS of $5.80 to $6.20, and operating cash flow of $700 million to $800 million.

Howard Coker’s tone was constructive and confident, emphasizing that Sunoco is a more focused and financially disciplined company. He highlighted strong industrial execution, share gains, new product development, and the ramp of capacity for saturated URB and wire-and-cable reels tied to AI data centers and infrastructure. He also said recovery mechanisms are now in place to offset inflation and that the company is positioned well for the second half.

Paul Joachimczyk stressed that the quarter showed solid execution across the strategy laid out at Investor Day. He pointed to adjusted EBITDA of $324 million, margin of 17.2%, adjusted EPS of $1.51, and operating cash flow of $301 million, and said profitability performance plan benefits contributed $0.07 in the quarter. He reiterated full-year guidance and said capital allocation remains focused on funding the business, supporting the dividend and strengthening the balance sheet; he also noted gross capital investment of $64 million and said capex should stay around 4% of turnover.

Analysts focused on whether URB markets had loosened, whether the strong pricing assumptions were embedded in guidance, and why consumer results lagged some earlier expectations. Management said they were not seeing weakness in the URB markets they serve, described the trade-press softness as a surprise, and said their backlog runs through the third quarter. On pricing, they said recovery from July and the third quarter is expected to be strong, though the URB increase would matter more in the fourth quarter; on consumer, they said North America softness was mainly in adhesives/sealants and aerosols, partly due to tougher comps and some macro-related pullback.