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By the numbers: Fiscal Q2 2026
Net sales: $1.07B
Down 0.5% year over year
Net income: $12.6M
Compared with $39.9M in Fiscal Q1 2025
- Soft demand continues: Years of soft demand dragged into Greif’s most recent quarter. “We don’t see an inflection point for the rest of the year,” said CEO Ole Rosgaard on a Wednesday earnings call covering the company’s fiscal second quarter, which ended March 31. “When a meaningful inflection of demand does occur, Greif will unlock significant operating leverage and earnings growth,” he said. New demand challenges also emerged in the quarter due to the war with Iran, which brought “direct impacts to our business,” Rosgaard said. “While the total EBITDA loss was less than $5 million in Q2, potential for continued disruption is factored into our guidance.”
- War impacts: The war, which began Feb. 28, has also involved conflict in nearby countries. Greif has multiple facilities in the region, including in Israel, Egypt and Saudi Arabia. Executives are addressing “intermittent periods of shutdowns in every one of our facilities in the region,” as well as supply chain disruptions and higher input costs, he said. Greif has weathered numerous conflicts in its nearly 150-year history, including recently in Venezuela and Ukraine, Rosgaard said, adding that experience and strategy will help it through the present Middle East situation. “When you operate almost 250 plants in over 40 countries and you have these occurrences, you just know what to do,” he said.
- URB price increase: One action to offset higher costs related to the war and other inflation is the $60 to $70 per short ton price increase on uncoated recycled board that Greif announced in March, similar to hikes from the other top three URB producers. Rosgaard noted that Fastmarkets RISI recognized the increase in April. The company expects to start feeling positive effects from the increase in July, with an anticipated full-year benefit of $9 million, said CFO Larry Hilsheimer.
- Cost-cutting progress: Greif advanced its cost optimization plan by $10 million last quarter and so far has achieved a total of $75 million in savings toward its stated goal of $120 million by the end of fiscal year 2027. It’s on track for the 2026 target of $80 million to $90 million, Rosgaard said. Free cash flow improved by $93 million year over year, Rosgaard said. “Those results demonstrate our ability to drive returns through volatility and disruptive impacts to our business from the conflict in the Middle East,” he added.
- Revised guidance: Because of the war uncertainty, Greif lowered the floor for its full-year EBIDTA guidance to $610 million from $630 million. “To be clear, if not for the already incurred and potential direct impacts of the conflict, we would not have changed our low-end guidance,” Hilsheimer said. The company also adjusted expectations for 2026 volumes. Greif now anticipates volumes for metals, fiber and closures will be down by mid-single digits, and polymers will be flat. The company maintains its low-end free cash flow guidance of $315 million.
