Packaging Of America Stock Earnings Reports

Packaging Corporation of America (PCA) reported 1Q26 net income of $171M ($1.91/share) and $215M ($2.40/share) excluding special items, vs. $208M ($2.31) in 1Q25. Net sales rose to $2.4B. Adjusted EBITDA was $486M (total company) and Packaging segment EBITDA was $482M (22% margin). Key drivers: higher prices/mix in legacy packaging, lower fiber and maintenance costs, strong mill operations (full capacity, production records at Jackson), and inventory reductions—particularly at acquired Greif plants. Greif operations were a $0.06/share drag in 1Q due to a January storm, seasonal mix, higher freight and recycled fiber costs; productivity has improved materially (Riverville ~10% higher in Feb) and integration/system inventory reductions are ongoing. PCA expects to implement announced containerboard price increases starting to show in May with majority benefit in Q3. 2Q26 guidance (ex-special items) is $2.33/share. Cash from operations was $329M; free cash flow $164M after $165M CapEx. Company repurchased ~266k shares in 1Q and has ~$224M repurchase authority remaining; dividends continue ($112M paid in 1Q). FY26 guidance reiterated: $840–870M CapEx and $700M DD&A. Sequential headwinds into 2Q include higher outage costs ($0.22 incremental outage cost in Q2 vs Q1, total outage expense now $1.44 for year), elevated freight, recycled fiber and chemical costs, and ~$17M higher stock‑based compensation phased into Q2–Q4. Board approved gas turbine projects for Jackson and Riverville and is proposing a third for DeRidder to improve energy independence. Management emphasizes tight containerboard market, ongoing integration and synergy capture from Greif (targeting synergies/run‑rate improvements), and execution risk around input cost inflation and geopolitical/market uncertainty.