Greif (GEF) Earnings & Sales Beat Estimates in Q4, Up Y/Y
Greif, Inc. GEF reported fourth-quarter fiscal 2021 (ended Oct 31, 2021) adjusted earnings per share (EPS) of $1.93, which surpassed the Zacks Consensus Estimate of $1.49. The bottom line increased 147% year on year.
Including one-time items, earnings per share was $1.74 in the quarter compared with 74 cents in the prior-year quarter.
Operational Update
Sales surged 36% year over year to $1,578 million. The top line beat the Zacks Consensus Estimate of $1,445 million.
Cost of sales was up 38% year over year to $1,282 million. Gross profit amounted to $296 million, up 28% from the prior-year quarter’s levels. Gross margin came in at 18.7% compared with the year-ago quarter’s 19.9%.
Selling, general and administrative (SG&A) expenses were up 22% year over year to $142 million. Adjusted operating profit soared 66% year over year to $154 million. Adjusted operating margin was 9.8% in the reported quarter compared with 8.0% in the year-earlier period. Adjusted EBITDA increased 37% year over year to $211 million in the fiscal fourth quarter.
Greif, Inc. Price, Consensus and EPS Surprise
Greif, Inc. price-consensus-eps-surprise-chart | Greif, Inc. Quote
Segmental Performance
Sales in the Global Industrial Packaging segment increased 46% year over year to $952 million. The segment’s adjusted EBITDA amounted to $121 million compared with the year-ago quarter’s $74 million.
The Paper Packaging segment sales rose 24% year over year to $622 million in the fiscal fourth quarter. The segment’s adjusted EBITDA moved up to $87.7 million from the prior-year quarter’s $77.4 million.
The Land Management segment’s sales totaled $4.9 million in the reported quarter compared with $6.7 million in the year-ago quarter. Adjusted EBITDA was $2.2 million, down from the year-earlier quarter’s $3 million.
Financials
As of fourth-quarter fiscal 2021-end, Greif reported cash and cash equivalents of $124.6 million, compared with $105.9 million as of the end of fiscal 2020. Cash flow from operating activities totaled $137 million in the quarter under review compared with $200 million in the prior-year quarter.
Long-term debt amounted to $2,054.8 million as of Oct 31, 2021, compared with $2,335.5 million as of Oct 31, 2020.
On Dec 7, Greif’s board announced a quarterly cash dividend of 46 cents per share of Class A Common Stock and 68 cents per share of Class B Common Stock. The dividend payout will be made on Jan 1 to shareholders of record at the close of business on Dec 17, 2021.
Fiscal 2021 Results
Greif reported an adjusted EPS of $5.60 for fiscal 2021 compared with $3.22 reported in fiscal 2020. Earnings also beat the Zacks Consensus Estimate of $5.16. Including one-time items, the bottom line came in at $6.54, up 257% from the $1.83 reported in fiscal 2020.
Sales increased 23% year over year to $5.56 billion. The top line also surpassed the Zacks Consensus Estimate of $5.42 billion.
Outlook
Given strong end-market demand, Greif expects fiscal 2022 adjusted EPS between $5.85 and $6.45. Adjusted free cash flow is anticipated between $400 million and $460 million.
Price Performance
Greif’s shares have appreciated 35.6% in the past year compared with the industry’s growth of 13.2%.
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Zacks Rank & Key Picks
Greif currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Industrial Products sector include SiteOne Landscape Supply SITE, A. O. Smith Corporation AOS and ScanSource, Inc. SCSC. While SiteOne Landscape and A. O. Smith flaunt a Zacks Rank #1, (Strong Buy), ScanSource carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
SiteOne Landscape has an estimated earnings growth rate of around 77.2% for the current year. In the past 30 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 14%.
In a year’s time, the company’s shares have increased 68%. SiteOne Landscape has a trailing four-quarter earnings surprise of 130.9%, on average.
A. O. Smith has an expected earnings growth rate of around 35% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised upward by 1% in the past 30 days.
A. O. Smith’s shares have surged 44% in a year’s time. The company has a trailing four-quarter earnings surprise of 16.8%, on average.
ScanSource has a projected earnings growth rate of around 19% for 2021. The Zacks Consensus Estimate for current-year earnings has been revised upward by 1% in the past 30 days.
The company’s shares have appreciated 23% over the past year. ScanSource has a trailing four-quarter earnings surprise of 34.6%, on average.
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