01—Abstract
Summary
Summary of the 10-K filed March 7, 2025. Cited figures are marked; the original filing is the authoritative source.
Smurfit Westrock plc reported its 2024 annual results on Form 10-K following the July 5, 2024 combination of Smurfit Kappa and WestRock, which was accounted for with Smurfit Kappa as the accounting acquirer.
Net sales rose to $21,109 milliona in 2024 from $12,093 million in 2023, driven mainly by the $9,381 million contributed by WestRock after closing. Net income attributable to common shareholders fell to $319 million from $825 million, reflecting $395 million of transaction and integration-related expenses, a $224 million inventory fair value step-up charge, and higher interest expense of $398 million versus $139 million. Adjusted EBITDA was $3,386 million versus $2,128 million, and Adjusted Earnings per Share - Basic was $2.34 versus $3.63.
Cash generation and balance sheet changes were significant. Net cash provided by operating activities was $1,483 millionb, while capital expenditures were $1,466 million and cash paid for acquisitions was $719 million. Total debt stood at $13,658 million excluding debt issuance costs, and cash and cash equivalents were $855 million.
Total assets increased to $43,759 millionc from $14,051 million. The company paid $650 million in cash dividends in 2024 and declared a quarterly dividend of $0.4308 per share in January 2025.
Investors should note that management concluded disclosure controls were not effective because of a material weakness in internal control over financial reporting, which relates principally to legacy Smurfit Kappa controls. The company also targets $400 milliond in annual pre-tax run-rate synergies by the end of the first full year after the Combination, and its Section 404 assessment is not required until the year ending December 31, 2025.
02—Key points
Key Highlights
- Net sales increased to $21,109 million in 2024 from $12,093 million in 2023, primarily due to the $9,381 million contribution from WestRock following the July 5, 2024 Combination.
- Net income attributable to common shareholders decreased to $319 million from $825 million, driven by $395 million of transaction and integration-related expenses and a $224 million inventory fair value step-up charge.
- Adjusted EBITDA was $3,386 million in 2024 compared with $2,128 million in 2023, and Adjusted Earnings per Share - Basic was $2.34 versus $3.63.
- Net cash provided by operating activities was $1,483 million, with capital expenditures of $1,466 million and cash paid for purchases of businesses of $719 million.
- Total debt was $13,658 million excluding debt issuance costs at December 31, 2024, and interest expense, net rose to $398 million from $139 million.
- Management identified a material weakness in internal control over financial reporting, and disclosure controls were concluded not to be effective as of year-end.
- The company paid $650 million in cash dividends in 2024, and the Board approved a quarterly dividend of $0.4308 per share in January 2025.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Smurfit Westrock kept $0.02.
- Revenue$21.11B100.0%
- Cost of revenue−$16.91B80.1%
- Gross profit$4.20B19.9%
- Operating costs−$3.19B15.1%
- Operating income$1.01B4.8%
- Interest, other & tax−$688.0M3.3%
- Net income$319.0M1.5%
Where FY2024 revenue went
$21.11B- Cost of revenue: $16.91B, 80% of revenue
- SG&A: $2.74B, 13% of revenue
- Net income: $319.0M, 1.5% of revenue
- Other operating costs: $451.0M, 2.1% of revenue
- Interest, other & tax: $688.0M, 3.3% of revenue
Kept 1.5% as net incomeNet income $319.0M · 1.5%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed March 7, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $21.11B$12.09B | +74.6% |
| Cost of Revenue | $16.91B$9.04B | +87.1% |
| Gross Profit | $4.20B$3.05B | +37.4% |
| SG&A Expenses | $2.74B$1.57B | +74.1% |
| Operating Income | $1.01B$1.37B | −26.6% |
| Net Income | $319.00M$825.00M | −61.3% |
| EPS (Basic) | $0.83$3.19 | −74.0% |
| EPS (Diluted) | $0.82$3.17 | −74.1% |
| Shares Outstanding (Basic) | 386.00M258.00M | +49.6% |
| Shares Outstanding (Diluted) | 389.00M260.00M | +49.6% |
05—Questions
Frequently Asked Questions
What drove the increase in net sales in 2024?
Net sales increased by $9,016 million to $21,109 million, primarily due to the impact of $9,381 million related to the acquisition of WestRock. Excluding the acquisition, net sales decreased by $365 million, reflecting a $715 million negative selling/price mix impact partly offset by a $377 million positive volume impact.
Why did net income attributable to common shareholders decline?
Net income attributable to common shareholders decreased by $506 million to $319 million. The filing attributes this mainly to a $317 million increase in transaction and integration-related expenses, a $259 million increase in interest expense, net, and a $224 million charge for the amortization of the fair value step-up on WestRock's acquired inventory.
What is the material weakness the company disclosed?
The material weakness relates to the company's selection and development of control activities and involves processes and controls principally at legacy Smurfit Kappa that were not previously subject to Section 404 of the Sarbanes-Oxley Act. It covers formalization of management review controls, manual journal entry controls, and general IT controls over logical access and program change management. The company states these deficiencies did not result in a material misstatement, and it has begun remediation.
What synergies is the company targeting from the Combination?
The company is targeting annual pre-tax run-rate synergies of $400 million by the end of the first full year following the Combination, from integration benefits, procurement leverage, and administrative and overhead rationalization. The filing also notes that these benefits may take longer to realize or be lower than estimated.
How much debt does the company carry and what are its liquidity sources?
As of December 31, 2024, total debt was $13,658 million excluding debt issuance costs, of which $1,053 million was current. The company had cash and cash equivalents of $855 million and $5,079 million of undrawn committed facilities, for total available liquidity of $5,934 million. The company believes these sources, together with operating cash flows, will be adequate for the next 12 months and the foreseeable future.
06—Continue