SEE, the company formerly known as Sealed Air, is embarking on a three-year restructuring program, it announced in conjunction with its second quarter earnings report Tuesday.
Noting “the current post-COVID lower-growth environment,” along with volume loss, destocking and accelerating sustainability pressures, the company is launching a program dubbed “Cost take-out to Grow.” The company said it’s targeting a return to volume and earnings growth in 2024 and seeks to reduce recurring costs by $140 million to $160 million annually by the end of 2025.
The program is part of its “Reinvent SEE 2.0” strategy. Priorities include expanding automation across operations, growing the fluids and liquids business and advancing digital printing and services. The restructuring program adds a focus on “streamlining our supply chain footprint.”
The announcement follows the rebrand to SEE in May, which the company said was driven by wanting to better reflect its focuses on “automation, digital and sustainable packaging solutions” going forward.
In the most recent quarter, total revenue declined 3% to $1.38 billion. Sales in SEE’s segment focused on food packaging were up 9% to $881 million, aided by its acquisition of bag-in-box liquid packaging company Liquibox, announced last November. Sales in its segment focused on protective packaging fell 18% to $500 million.
SEE lowered its sales expectations for 2023 to between $5.4 billion and $5.6 billion, down from $5.85 billion to $6.1 billion. The Liquibox acquisition factors in a 5% to 6% benefit, the company said. SEE also changed its free cash flow guidance for the year to $325 million to $375 million, down from $475 million to $525 million, excluding a $175 million tax deposit “related to a tentative agreement to settle a dispute with the IRS.”
SEE also recently announced it’s working with ExxonMobil in Australia to repurpose food packaging trays used with red meat via “advanced recycling.” SEE said the collaboration “addresses the critical challenge in driving a circular economy for food-grade plastics that have strict hygiene and performance requirements for food protection and distribution.” The company ultimately aims to funnel all of its Australian-made trays through this solution.
SEE has pledged to “design or advance” all of its packaging solutions to be recyclable or reusable by 2025. It’s also aiming to incorporate an average of 50% “recycled or renewable content” into products.
