Ranpak Holdings Corp. Q4 FY2024 earnings call

• 2024 ended positively with best quarter of the year, second best quarterly revenue in history. Experienced double-digit volume growth in fourth quarter and full year.
• Moved away from fixed rate constant currency presentation, adjusting to reported rate of $1.08 instead of $1.15.
• North America business drove top line, with sales up 36% and volumes up nearly 40% in quarter, full year up 19%. Europe and APAC saw top line improvement but with macro challenges.
• Automation revenue grew over 40% in 2024, expected to grow over 50% in 2025. CapEx declined 40% in 2024, ending major investment cycle.
• Announced transformational transaction with largest customer and exclusive commercial partnership with Rabot, enhancing technology and solutions.

In the fourth quarter, consolidated net revenue increased 17% on a constant currency basis, driven by 12% volume growth. North America was the engine, with sales up 36% and volumes up nearly 40%, full year net revenue up 19%. Europe and APAC combined revenue increased 1% on a constant currency basis for the quarter, with full year up 3% constant currency. Automation revenue grew over 40% in 2024 and is expected to grow over 50% in 2025. North America's full year net revenue was up 19% driven by void-fill and automation. Europe and APAC have favorable input cost environments but face energy market volatility. Automation, at ~$30M in sales in 2024, was a drag on profitability but expected to grow substantially in 2025, moving towards breakeven by year-end.

• On constant currency basis, forecasting net revenue growth 5%-11% and adjusted EBITDA growth 5%-16% for 2025, with net revenue range $387M-$409M and adjusted EBITDA $88M-$97M.
• Automation revenue expected to be up over 50% in 2025. CapEx expected to be between $36M-$38M.
• Expect to generate ~$20M in cash in 2025 to pay down ~$50M of debt.

• Currency fluctuations, with outside cap structure hedged but exposure largely translation. Input cost environment varies by geography, with North American paper market tight and European energy markets volatile.
• Tariffs pose uncertainty, though minimal impact on paper sourcing seen. Warrant expense related to Amazon will cause non-cash decrease in revenue, impacting GAAP figures and adjusted EBITDA.

Q: Could you provide more color on the Amazon ramp-up in 2025?

A: We are ramping up with Amazon across different facilities in the US and expanding dialogue in Europe and APAC across various offerings. Expect a busy year with them, moving towards asset-light model.

Q: How does the mid to high-single digit volume growth in 2025 break down by paper vs automation?

A: PPS volume growth in mid to high-single digits, automation contributing 3-5 points, with price mix headwind including Amazon warrants.

Q: What about revenue seasonality in Q1?

A: Typically, Q1 is the lowest in revenue contribution compared to Q4, with a step down, historically high-single digits to low-double digits, and seasonality building throughout the year.