SON 10-Q Quarterly Report March 30, 2025

SONOCO PRODUCTS CO

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son-20250330

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-11261

Sonoco Products Company

(Exact name of registrant as specified in its charter)


South Carolina						57-0248420
(State or other jurisdiction of incorporation of organization)						(I.R.S. Employer Identification No.)

1 N. Second St. , Hartsville , South Carolina						29550
(Address of principal executive offices)						(Zip Code)

( 843 ) 383-7000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
No par value common stock	SON	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s no par value common stock as of April 18, 2025 was 98,627,981 .

SONOCO PRODUCTS COMPANY

INDEX


PART I. FINANCIAL INFORMATION		3

Item 1.	Financial Statements:	3

	Condensed Consolidated Balance Sheets – March 30, 2025 (unaudited) and December 31, 2024 (unaudited)	3

	Condensed Consolidated Statements of Income – Three Months Ended March 30, 2025 (unaudited) and March 31, 2024 (unaudited)	4

	Condensed Consolidated Statements of Comprehensive Income – Three Months Ended March 30, 2025 (unaudited) and March 31, 2024 (unaudited)	5

	Condensed Consolidated Statements of Changes in Total Equity – Three Months Ended March 30, 2025 (unaudited) and March 31, 2024 (unaudited)	6

	Condensed Consolidated Statements of Cash Flows – Three Months Ended March 30, 2025 (unaudited) and March 31, 2024 (unaudited)	7

	Notes to Condensed Consolidated Financial Statements (unaudited)	8



Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	40

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	56

Item 4.	Controls and Procedures.	57

PART II. OTHER INFORMATION		58

Item 1.	Legal Proceedings.	58



Item 1A.	R isk Factors .	58

Item 5.	Other Information.	59

Item 6.	Exhibits.	60

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

SONOCO PRODUCTS COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(Dollars and shares in thousands)


	March 30, 2025		December 31, 2024*
Assets
Current Assets
Cash and cash equivalents	$	181,829	$	431,010
Trade accounts receivable, net of allowances	994,293		907,526
Other receivables	191,513		175,877
Inventories, net:
Finished and in process	583,190		494,090
Materials and supplies	558,667		522,049
Prepaid expenses	200,874		197,134

Current assets of discontinued operations	463,908		450,874
Total Current Assets	3,174,274		3,178,560
Property, Plant and Equipment, Net	2,775,734		2,718,747
Goodwill	2,589,203		2,525,657
Other Intangible Assets, Net	2,623,961		2,586,698
Deferred Income Taxes	14,875		17,371
Right of Use Asset-Operating Leases	329,601		307,688
Other Assets	196,999		208,759
Non-current assets of discontinued operations	975,946		964,310
Total Assets	$	12,680,593	$	12,507,790
Liabilities and Equity
Current Liabilities
Payable to suppliers	$	1,023,006	$	1,130,500
Accrued expenses and other	551,451		604,455
Notes payable and current portion of long-term debt	2,147,787		2,054,525
Accrued taxes	22,516		6,755

Current liabilities of discontinued operations	240,387		242,056
Total Current Liabilities	3,985,147		4,038,291
Long-term Debt, Net of Current Portion	4,978,337		4,985,496
Noncurrent Operating Lease Liabilities	277,932		258,735
Pension and Other Postretirement Benefits	183,280		180,827
Deferred Income Taxes	578,679		583,470
Other Liabilities	118,125		60,847
Non-current liabilities of discontinued operations	97,161		113,911
Total Liabilities	10,218,661		10,221,577
Commitments and Contingencies (See Note 18)

Sonoco Shareholders’ Equity
Common stock, no par value
Authorized 300,000 shares; 98,628 and 98,260 shares issued and outstanding at March 30, 2025 and December 31, 2024, respectively	7,175		7,175
Capital in excess of stated value	178,778		183,250
Accumulated other comprehensive loss	( 324,569 )		( 502,734 )
Retained earnings	2,586,794		2,583,923
Total Sonoco Shareholders’ Equity	2,448,178		2,271,614
Noncontrolling Interests	13,754		14,599
Total Equity	2,461,932		2,286,213
Total Liabilities and Equity	$	12,680,593	$	12,507,790


*			The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (the “United States” or “U.S.”).

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

SONOCO PRODUCTS COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)

(Dollars and shares in thousands except per share data)


	Three Months Ended
		March 30, 2025		March 31, 2024
Net sales		$	1,709,228	$	1,308,636
Cost of sales		1,355,541		1,037,471
Gross profit		353,687		271,165
Selling, general and administrative expenses		209,063		167,583
Restructuring/Asset impairment charges		13,581		31,010
Loss on divestiture of business and other assets		( 4,183 )		—
Operating profit		126,860		72,572
Other expense, net		( 6,517 )		—
Non-operating pension costs		3,121		3,295
Interest expense		56,027		30,164
Interest income		7,348		3,133

Income from continuing operations before income taxes		68,543		42,246
Provision for income taxes		21,147		7,871
Income before equity in earnings of affiliates		47,396		34,375
Equity in earnings of affiliates, net of tax		1,921		1,137
Net income from continuing operations		49,317		35,512
Net income from discontinued operations		5,172		29,761
Net income		54,489		65,273
Net income from continuing operations attributable to noncontrolling interests		( 60 )		( 48 )
Net income from discontinued operations attributable to noncontrolling interests		—		( 48 )
Net income attributable to Sonoco		$	54,429	$	65,177

Weighted average common shares outstanding:
Basic		98,913		98,498
Diluted		99,342		99,159
Per common share:
Basic earnings per common share:
Continuing operations		$	0.50	$	0.36
Discontinued operations		0.05		0.30
Basic earnings per share attributable to Sonoco		$	0.55	$	0.66
Diluted earnings per common share:
Continuing operations		$	0.50	$	0.36
Discontinued operations		0.05		0.30
Diluted earnings per share attributable to Sonoco		$	0.55	$	0.66

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

SONOCO PRODUCTS COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF

COMPREHENSIVE INCOME (unaudited)

(Dollars in thousands)


	Three Months Ended
		March 30, 2025		March 31, 2024
Net income		$	54,489	$	65,273
Other comprehensive income/(loss):
Foreign currency translation adjustments		175,839		( 19,786 )
Changes in defined benefit plans, net of tax		544		43
Changes in derivative financial instruments, net of tax		1,757		169
Other comprehensive income/(loss)		178,140		( 19,574 )
Comprehensive income:		232,629		45,699
Net income attributable to noncontrolling interests-continuing operations		( 60 )		( 48 )
Net income attributable to noncontrolling interests-discontinued operations		—		( 48 )
Other comprehensive loss attributable to noncontrolling interests		25		467
Comprehensive income attributable to Sonoco		$	232,594	$	46,070

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

SONOCO PRODUCTS COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF

CHANGES IN TOTAL EQUITY (unaudited)

(Dollars and shares in thousands)


	Total Equity		Common Shares			Capital in Excess of Stated Value		Accumulated Other Comprehensive Loss		Retained Earnings		Noncontrolling Interests
			Outstanding	Amount
December 31, 2024	$	2,286,213	98,260	$	7,175	$	183,250	$	( 502,734 )	$	2,583,923	$	14,599
Net income	54,489									54,429		60
Other comprehensive income/(loss):
Translation gain/(loss)	175,839							175,864				( 25 )
Defined benefit plan adjustment, net of tax	544							544
Derivative financial instruments, net of tax	1,757							1,757
Other comprehensive income/(loss)	178,140							178,165				( 25 )
Divestiture of noncontrolling interests	( 637 )											( 637 )
Dividends	( 51,558 )									( 51,558 )
Dividends paid to noncontrolling interests	( 243 )											( 243 )
Issuance of stock awards	273		588			273
Shares repurchased	( 10,573 )		( 220 )			( 10,573 )
Share-based compensation	5,828					5,828

March 30, 2025	$	2,461,932	98,628	$	7,175	$	178,778	$	( 324,569 )	$	2,586,794	$	13,754


	Total Equity		Common Shares			Capital in Excess of Stated Value		Accumulated Other Comprehensive Loss		Retained Earnings		Noncontrolling Interests
			Outstanding	Amount
December 31, 2023	$	2,431,835	97,957	$	7,175	$	159,047	$	( 366,262 )	$	2,624,380	$	7,495
Net income	65,273									65,177		96
Other comprehensive (loss)/income:
Translation loss	( 19,786 )							( 19,319 )				( 467 )
Defined benefit plan adjustment, net of tax	43							43
Derivative financial instruments, net of tax	169							169
Other comprehensive loss	( 19,574 )							( 19,107 )				( 467 )
Dividends	( 50,348 )									( 50,348 )
Issuance of stock awards	204		460			204
Shares repurchased	( 9,139 )		( 162 )			( 9,139 )
Share-based compensation	8,325					8,325
Other	906					906
March 31, 2024	$	2,427,482	98,255	$	7,175	$	159,343	$	( 385,369 )	$	2,639,209	$	7,124

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

SONOCO PRODUCTS COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(Dollars in thousands)


	Three Months Ended
	March 30, 2025		March 31, 2024
Cash Flows from Operating Activities:
Net income	$	54,489	$	65,273
Adjustments to reconcile net income to net cash (used)/provided by operating activities:
Asset impairments	4,949		8,346
Depreciation, depletion and amortization	121,492		90,559

Share-based compensation expense	5,829		8,325
Equity in earnings of affiliated companies, net	( 1,921 )		( 1,137 )
Cash dividends from affiliated companies	—		41
Net loss on disposition of assets	277		18
Net loss on divestiture of business and other assets	4,183		—

Pension and postretirement plan expense	4,357		4,104
Pension and postretirement plan contributions	( 4,223 )		( 3,989 )
Net decrease in deferred tax liabilities	( 3,720 )		( 4,869 )
Change in assets and liabilities, net of effects from acquisitions, divestitures and foreign currency adjustments:
Trade accounts receivable	( 64,292 )		( 43,334 )
Inventories	( 110,177 )		18,407
Payable to suppliers	( 134,906 )		25,697
Prepaid expenses	( 901 )		( 3,572 )
Income taxes payable and other income tax items	16,703		9,436
Accrued expenses and other assets and liabilities	( 100,233 )		( 7,070 )
Net cash (used)/provided by operating activities	( 208,094 )		166,235
Cash Flows from Investing Activities:
Purchases of property, plant and equipment	( 92,657 )		( 86,458 )
Cost of acquisitions, net of cash acquired	—		( 452 )
Proceeds from the sale of business, net	3,513		—
Proceeds from the sale of assets, net	474		101


Other net investing activities	88		5,077
Net cash used by investing activities	( 88,582 )		( 81,732 )
Cash Flows from Financing Activities:
Proceeds from issuance of debt	24,535		19,674
Principal repayment of debt	( 473,293 )		( 21,448 )
Net change in commercial paper	528,000		—
Net increase/(decrease) in book cash overdrafts	12,448		( 1,614 )


Dividends paid to noncontrolling interests	( 243 )		—
Cash dividends	( 51,285 )		( 50,144 )


Payments for share repurchases	( 10,573 )		( 9,139 )

Net cash provided/(used) by financing activities	29,589		( 62,671 )
Effects of Exchange Rate Changes on Cash	15,742		( 1,556 )
Net (Decrease)/Increase in Cash and Cash Equivalents	( 251,345 )		20,276
Cash and cash equivalents at beginning of period	443,060		151,937
Cash and cash equivalents at end of period	$	191,715	$	172,213

See accompanying Notes to Condensed Consolidated Financial Statements (unaudited)

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 1: Basis of Interim Presentation

On April 1, 2025, subsequent to the three-month period ended March 30, 2025, Sonoco Products Company (the “Company” or “Sonoco”) completed the previously announced sale of its Thermoformed and Flexibles Packaging business and its global Trident business (collectively, “TFP”) to TOPPAN Holdings Inc. (“Toppan”) for approximately $ 1,800,000 on a cash-free and debt-free basis and subject to customary adjustments. In accordance with applicable accounting guidance, the results of TFP, previously part of the Company’s Consumer Packaging segment, are presented as discontinued operations in the Condensed Consolidated Statements of Income and, as such, have been excluded from both continuing operations and segment results for all periods presented in this Quarterly Report on Form 10-Q. Further, the Company reclassified the assets and liabilities of TFP as assets and liabilities of discontinued operations in the Condensed Consolidated Balance Sheets as of March 30, 2025 and December 31, 2024. The Condensed Consolidated Statements of Comprehensive Income, Changes in Total Equity, and Cash Flows are presented on a consolidated basis for both continuing operations and discontinued operations. All amounts, percentages and disclosures for all periods presented in this Quarterly Report on Form 10-Q reflect only the continuing operations of Sonoco unless otherwise noted. See Note 2 for additional information.

In the opinion of the management of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments, unless otherwise stated) necessary to state fairly the consolidated financial position, results of operations and cash flows for the interim periods reported herein. Operating results for the three-month period ended March 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Note 2: Discontinued Operations

As disclosed in Note 1 , the Company completed the previously announced sale of TFP o n April 1, 2025 . The following table presents the assets and liabilities that are classified as discontinued operations in the Condensed Consolidated Balance Sheets as of March 30, 2025 and December 31, 2024:

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)


	March 30, 2025		December 31, 2024
Cash and cash equivalents	$	9,886	$	12,050
Trade accounts receivable, net of allowances of $ 2,190 at March 30, 2025 and $ 2,582 at December 31, 2024	213,627		209,379
Other receivables	48,273		46,001
Inventories, net:
Finished and in process	84,616		80,573
Materials and supplies	99,826		94,083
Prepaid expenses	7,680		8,788
Current assets of discontinued operations	$	463,908	$	450,874
Property, plant and equipment, net of accumulated depreciation of $ 457,621 at March 30, 2025 and $ 465,923 at December 31, 2024	271,237		262,662
Goodwill	505,009		502,621
Other intangible assets, net of accumulated amortization of $ 206,601 at March 30, 2025 and $ 206,437 and December 31, 2024	104,428		103,593
Long-term deferred income taxes	288		262
Right of use asset-operating leases	74,140		75,855
Other assets	20,844		19,317
Non-current assets of discontinued operations	$	975,946	$	964,310
Payable to suppliers	170,770		172,720
Accrued expenses and other	48,026		62,562
Notes payable and current portion of long-term debt	21,591		6,774
Current liabilities of discontinued operations	$	240,387	$	242,056
Long-term debt	16,028		29,850
Noncurrent operating lease liabilities	64,458		67,789

Deferred income taxes	16,363		15,928
Other liabilities	312		344
Non-current liabilities of discontinued operations	$	97,161	$	113,911

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table presents key components of “Net income from discontinued operations” for the three months ended March 30, 2025 and March 31, 2024:


	Three Months Ended
	March 30, 2025		March 31, 2024
Net sales	$	320,678	$	328,907
Cost of sales	250,854		262,519
Gross profit	69,824		66,388
Selling, general and administrative expenses	31,607		25,899
Restructuring/Asset impairment charges	426		608
Operating profit	37,791		39,881
Other income, net	182		—
Interest expense	24,911		1,056
Interest income	281		425
Income from discontinued operations before income taxes	12,979		39,250
Provision for income taxes	7,807		9,489
Net income from discontinued operations	5,172		29,761
Net income from discontinued operations attributable to noncontrolling interests	—		( 48 )
Net income attributable to discontinued operations	$	5,172	$	29,713

Weighted average common shares outstanding:
Basic	98,913		98,498
Diluted	99,342		99,159

Per common share:
Net income attributable to discontinued operations:
Basic	$	0.05	$	0.30
Diluted	$	0.05	$	0.30

The following table presents significant cash flow items from discontinued operations for the three months ended March 30, 2025 and March 31, 2024:


	Three Months Ended
	March 30, 2025		March 31, 2024
Depreciation, depletion and amortization (a)	$	( 311 )	$	15,613
Capital expenditures	$	( 5,572 )	$	( 12,569 )

(a) Subsequent to entering the agreement on December 8, 2024 to sell TFP, depreciation was not recognized on TFP’s property, plant and equipment, and amortization was not recognized on TFP’s other intangible assets or right of use assets-operating leases, in accordance with Accounting Standards Codification (“ASC”) 360, “Property, Plant, and Equipment.”

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 3: New Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires companies to disclose disaggregated amounts relating to (a) inventory purchases; (b) employee compensation; (c) depreciation; (d) intangible asset amortization; and (e) depreciation, depletion, and amortization. Further, this guidance will require companies to include certain amounts that are already required to be disclosed under current U.S. generally accepted accounting principles (“GAAP”) in the same disclosure as the other disaggregation requirements, disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively and disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The standard is intended to benefit investors by providing more detailed expense disclosures that would be useful in making capital allocation decisions. This guidance is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027 but early adoption is permitted. ASU 2024-03 should be applied on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which modifies the rules on income tax disclosures to require disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted. ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

During the three-month period ended March 30, 2025, there were no other newly issued or newly applicable accounting pronouncements that had, or are expected to have, a material impact on the Company’s condensed consolidated financial statements. Further, at March 30, 2025, there were no other pronouncements pending adoption that are expected to have a material impact on the Company’s condensed consolidated financial statements.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 4: Acquisitions and Divestitures

Eviosys Acquisition

On December 4, 2024, the Company completed the acquisition of all issued and outstanding equity interests in Titan Holdings I B.V. (“Eviosys”) from an affiliate of KPS Capital Partners, LP for net cash consideration of $ 3,789,826 . Eviosys is a global supplier of metal packaging that produces food cans and ends, aerosol cans, metal closures and promotional packaging with a large metal food can manufacturing footprint in the Europe, Middle East, and Africa region. The Company funded the Eviosys acquisition, including related fees and expenses, with the net proceeds from the registered public offering of senior unsecured notes, borrowings from two term loan facilities, and cash on hand. See Note 11 to the Company’s Consolidated Financial Statements included in Part IV, Item 15 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for more information. The financial results of Eviosys are included in the Company’s Consumer Packaging segment.

The Company’s preliminary fair values of the assets acquired and liabilities assumed in the acquisition of Eviosys, are as follows:


	Initial Allocation		Measurement Period Adjustments		Preliminary Allocation
Trade accounts receivable	$	300,385	—		$	300,385
Other receivables	114,634		—		114,634
Inventories	445,945		1,630		447,575
Prepaid expenses	47,509		1,448		48,957
Property, plant and equipment	1,057,779		( 6,573 )		1,051,206
Right of use asset - operating leases	43,566		—		43,566
Other intangible assets	1,967,678		( 5,253 )		1,962,425
Goodwill	1,285,518		595		1,286,113
Long-term deferred income taxes	39,023		( 388 )		38,635
Other assets	3,330		19		3,349
Payable to suppliers	( 518,766 )		132		( 518,634 )
Accrued expenses and other	( 168,529 )		325		( 168,204 )
Accrued wages and other compensation	( 41,749 )		—		( 41,749 )

Notes payable and current portion of long-term debt	( 76,438 )		( 39 )		( 76,477 )
Noncurrent operating lease liabilities	( 32,022 )		—		( 32,022 )
Pension and other postretirement benefits	( 51,849 )		—		( 51,849 )

Deferred income taxes	( 599,941 )		7,716		( 592,225 )
Other long-term liabilities	( 16,714 )		388		( 16,326 )
Noncontrolling interests	( 9,533 )		—		( 9,533 )
Net assets acquired	$	3,789,826	$	—	$	3,789,826

The preliminary allocation of the purchase price of Eviosys to the tangible and intangible assets acquired and liabilities assumed, as reflected in the table above, is based on the Company’s preliminary allocations of their respective fair values, based on information currently available. Management is continuing to finalize its valuation of certain assets and liabilities including, but not limited to: inventory; property, plant and equipment; goodwill; other intangible assets; operating leases; and deferred income taxes, and expects to complete its valuations within one year of the date of acquisition.

Factors comprising goodwill for Eviosys, none of which is expected to be deductible for income tax purposes, include increased access to certain markets and the value of the assembled workforce.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table presents the Company’s pro forma consolidated results for the three-month period ended March 31, 2024, assuming the acquisition of Eviosys had occurred on January 1, 2023. This pro forma information is presented for informational purposes only and does not purport to represent the results of operations that would have been achieved if the acquisition had been completed at the beginning of 2023, nor is it necessarily indicative of future consolidated results.


Pro Forma Supplemental Information	Three Months Ended
Consolidated	March 31, 2024
Net sales	$	1,839,570
Net income from continuing operations	$	8,146
Net income attributable to Sonoco 1	$	37,859

1 Includes results of discontinued operations

The pro forma information above does not project the Company’s expected results for any future period and gives no effect to any future synergistic benefits that may result from the combination or the costs of integrating the acquired operations with those of the Company. Pro forma information for the period ended March 31, 2024 includes adjustments to depreciation, amortization, and income taxes based upon the preliminary fair value allocation of the purchase price to Eviosys’ tangible and intangible assets acquired and liabilities assumed as though the acquisition had occurred on January 1, 2023. Interest expense on the additional debt issued by the Company to fund the acquisition and retention bonuses incurred related to the acquisition are also included in the pro forma information as if the acquisition had occurred on January 1, 2023. Acquisition-related costs are excluded from 2024 pro forma net income and are instead reflected in 2023 pro forma net income as though the acquisition had occurred on January 1, 2023.

Divestiture of Businesses

On April 1, 2025, subsequent to the three-month period ended March 30, 2025, the Company completed the previously announced sale of its TFP businesses to Toppan for approximately $ 1,800,000 on a cash-free and debt-free basis and subject to customary adjustments. In accordance with applicable accounting guidance, the results of TFP, previously part of the Company’s Consumer Packaging segment, are presented as discontinued operations in the Condensed Consolidated Statements of Income and, as such, have been excluded from both continuing operations and segment results for all periods presented in this Quarterly Report on Form 10-Q. The Company preliminarily expects to recognize an estimated gain on the divestiture of TFP of at least $ 375,000 , net of tax, in the second quarter of 2025.

On March 2, 2025, the Company completed the sale of its tube and core operations in Venezuela, part of the Industrial Paper Packaging segment, in exchange for a receivable in the amount of $ 145 . The sale resulted in a loss of $ 5,390 , including $ 3,792 of cumulative translation losses that were reclassified from accumulated other comprehensive income. This loss is included in “Loss on divestiture of business and other assets” in the Company’s Condensed Consolidated Statements of Income.

In February 2025, the remaining $ 2,000 of proceeds from the July 1, 2023 sale of the Company’s U.S. BulkSak business were released to the Company from escrow.

On January 17, 2025, the Company completed the sale of a small construction tube operation in France, part of the Industrial Paper Packaging segment, for cash proceeds of $ 1,513 and recognized a gain of $ 1,207 , which is included in “Loss on divestiture of business and other assets” in the Company’s Condensed Consolidated Statements of Income.

The sales of the operations in Venezuela and France do not represent a strategic shift for the Company and did not have a major effect on its operations or financial results. Consequently, these sales did not meet the criteria for reporting as discontinued operations.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Acquisition, Integration, and Divestiture-Related Costs

Acquisition, integration, and divestiture-related costs from continuing operations totaled $ 27,266 and $ 5,504 during the three-month periods ended March 30, 2025 and March 31, 2024, respectively. These costs included $ 9,317 and $ 5,504 during the three-month periods ended March 30, 2025 and March 31, 2024, respectively, for legal and professional fees, representation and warranty insurance premiums, as well as employee-related costs, and other integration activity costs that are included in “Selling, general and administrative expenses.” In addition, amortization of the fair value step-up of finished goods inventory totaled $ 17,949 during the three-month period ended March 30, 2025 and is included in “Cost of sales” in the Company’s Condensed Consolidated Statements of Income.

Note 5: Shareholders’ Equity

Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share:


	Three Months Ended
		March 30, 2025		March 31, 2024
Numerator:
Net income from continuing operations		$	49,317	$	35,512
Net income from continuing operations attributable to noncontrolling interests		( 60 )		( 48 )
Net income from continuing operations attributable to Sonoco		49,257		35,464

Net income attributable to Sonoco		$	54,429	$	65,177

Denominator:
Weighted average common shares outstanding		98,913		98,498
Dilutive effect of shared-based compensation		429		661
Diluted outstanding shares		99,342		99,159

Per common share:
Basic earnings per common share:
Net income from continuing operations		$	0.50	$	0.36
Net income attributable to Sonoco		$	0.55	$	0.66
Diluted earnings per common share:
Net income from continuing operations		$	0.50	$	0.36
Net income attributable to Sonoco		$	0.55	$	0.66

Cash dividends		$	0.52	$	0.51

No adjustments were made to “Net income attributable to Sonoco” in the computations of net income attributable to Sonoco per common share.

Anti-dilutive Securities

Potentially dilutive securities are calculated in accordance with the treasury stock method, which assumes the proceeds from the exercise of all dilutive stock appreciation rights (“SARs”) are used to repurchase the Company’s common stock. Certain SARs are not dilutive because either the exercise price is greater than the average market price of the stock during the reporting period or assumed repurchases from proceeds from the exercise of the SARs were anti-dilutive. These SARs may become dilutive in the future if the market price of the Company’s common stock appreciates.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The average numbers of SARs that were anti-dilutive and, therefore, not included in the computation of diluted earnings per share during the three-month periods ended March 30, 2025 and March 31, 2024 were as follows (in thousands):

Three Months Ended

March 30, 2025

March 31, 2024

Anti-dilutive stock appreciation rights

548

340

Stock Repurchases

On April 20, 2021, the Company’s Board of Directors (the “Board”) authorized the repurchase of the Company’s common stock in an aggregate amount of up to $ 350,000 . Following several repurchase transactions in 2021, a total of $ 137,972 remained available for share repurchases under this authorization as of December 31, 2021. Subsequent to 2021, no additional shares have been repurchased under this authorization.

The Company regularly repurchases shares of its common stock to satisfy employee tax withholding obligations in association with certain share-based compensation awards. These repurchases, which are not part of a publicly announced plan or program, totaled 220 shares during the three-month period ended March 30, 2025, at a cost of $ 10,573 , and 162 shares during the three-month period ended March 31, 2024, at a cost of $ 9,139 .

Dividend Declarations

On February 12, 2025, the Board declared a regular quarterly dividend of $ 0.52 per share. This dividend was paid on March 10, 2025 to all shareholders of record as of February 26, 2025.

On April 16, 2025, the Board declared a regular quarterly dividend of $ 0.53 per share. This dividend is payable on

June 10, 2025 to all shareholders of record as of May 9, 2025.

Note 6: Restructuring and Asset Impairments

Due to its geographic footprint and the cost-competitive nature of its businesses, the Company is continually seeking more cost-effective means and structures to serve its customers and to respond to significant changes in its markets. As such, plant closures in connection with footprint rationalization and headcount reductions are an important component of the Company’s cost control initiatives. The amount of these costs can vary significantly from quarter to quarter and from year to year depending upon the scope, nature, and location of the restructuring activities.

Following are the total restructuring and asset impairment charges, net of adjustments, recognized during the periods presented:



	Three Months Ended
		March 30, 2025		March 31, 2024
Restructuring and restructuring-related asset impairment charges		$	13,581	$	31,010
Other asset impairments		—		—
Restructuring/Asset impairment charges		$	13,581	$	31,010

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The table below sets forth restructuring and restructuring-related asset impairment charges by type incurred:



	Three Months Ended
		March 30, 2025		March 31, 2024
Severance and Termination Benefits		$	6,998	$	17,791
Asset Impairment/Disposal of Assets		5,101		8,122
Other Costs		1,482		5,097
Total restructuring and restructuring-related asset impairment charges		$	13,581	$	31,010

The table below sets forth restructuring and restructuring-related asset impairment charges attributable to each reportable segment, the All Other group of businesses, and Corporate-related activity:



	Three Months Ended
		March 30, 2025		March 31, 2024
Consumer Packaging		$	1,229	$	4,317
Industrial Paper Packaging		12,535		22,603
All Other		( 32 )		1,148
Corporate		( 151 )		2,942
Total restructuring and restructuring-related asset impairment charges		$	13,581	$	31,010

Restructuring and restructuring-related asset impairment charges are included in “Restructuring/Asset impairment charges” in the Company’s Condensed Consolidated Statements of Income.

The following table sets forth the activity in the restructuring accrual included in “Accrued expenses and other” in the Company’s Condensed Consolidated Balance Sheets:


	Severance and Termination Benefits		Asset Impairments/ Disposal of Assets		Other Costs		Total
Accrual Activity
Liability at December 31, 2024	$	24,034	$	—	$	909	$	24,943
2025 charges	6,998		5,101		1,482		13,581

Cash (payments)/receipts	( 9,271 )		10		( 1,452 )		( 10,713 )
Asset write downs/disposals	—		( 5,111 )		—		( 5,111 )
Foreign currency translation	227		—		274		501
Liability at March 30, 2025	$	21,988	$	—	$	1,213	$	23,201

“Severance and Termination Benefits” during the three-month period ended March 30, 2025 includes the cost of severance for approximately 80 employees whose positions were eliminated in conjunction with the Company’s ongoing organizational effectiveness efforts, including severance related to the closures of a cone facility in China, a cone facility in Mexico, and a partitions facility in Scarborough, Maine, all part of the Industrial Paper Packaging segment.

“Asset Impairment/Disposal of Assets” during the three-month period ended March 30, 2025 consists primarily of asset write-offs related to the closures of the cone facilities in China and Mexico, and the partitions facility in Scarborough, Maine, all part of the Industrial Paper Packaging segment.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

“Other Costs” during the three-month period ended March 30, 2025 consists primarily of equipment removal, utilities, plant security, property taxes, insurance and environmental remediation costs related to the prior year’s closure of the Company’s paper mill in Sumner, Washington, and ongoing facility carrying costs of previously announced plant closures.

The Company expects to pay the majority of the remaining restructuring reserves by the end of 2025 using cash generated from operations. The Company also expects to recognize future additional charges totaling approximately $ 5,700 in connection with previously announced restructuring actions and believes that the majority of these charges will be incurred and paid by the end of 2025. The Company continually evaluates its cost structure, including its manufacturing capacity, and additional restructuring actions are likely to be undertaken.

Note 7: Accumulated Other Comprehensive Loss

The following table summarizes the components of accumulated other comprehensive loss and the changes in the balances of each component of accumulated other comprehensive loss, net of tax as applicable, for the three-month periods ended March 30, 2025 and March 31, 2024:


	Foreign Currency Items		Defined Benefit Pension Items		Gains and Losses on Cash Flow Hedges		Accumulated Other Comprehensive Loss

Balance at December 31, 2024	$	( 410,931 )	$	( 90,613 )	$	( 1,190 )	$	( 502,734 )
Other comprehensive income/(loss) before reclassifications	172,072		( 265 )		2,024		173,831
Amounts reclassified from accumulated other comprehensive loss to net income	3,792		809		( 267 )		4,334

Other comprehensive income	175,864		544		1,757		178,165

Balance at March 30, 2025	$	( 235,067 )	$	( 90,069 )	$	567	$	( 324,569 )

Balance at December 31, 2023	$	( 267,578 )	$	( 99,627 )	$	943	$	( 366,262 )
Other comprehensive (loss)/income before reclassifications	( 19,319 )		( 932 )		518		( 19,733 )
Amounts reclassified from accumulated other comprehensive loss to net income	—		975		( 349 )		626

Other comprehensive (loss)/income	( 19,319 )		43		169		( 19,107 )

Balance at March 31, 2024	$	( 286,897 )	$	( 99,584 )	$	1,112	$	( 385,369 )

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table summarizes the effects on net income of significant amounts reclassified from each component of accumulated other comprehensive loss for the three-month periods ended March 30, 2025 and March 31, 2024:


	Amount Reclassified from Accumulated Other Comprehensive Loss
	Three Months Ended
Details about Accumulated Other Comprehensive Loss Components		March 30, 2025		March 31, 2024		Affected Line Item in the Condensed Consolidated Statements of Income
Foreign currency items
Currency translation adjustment loss on Venezuela sale (a)		$	( 3,792 )	$	—	Loss on divestiture of business and other assets

		( 3,792 )		—		Net income
Gains/(losses) on cash flow hedges
Foreign exchange contracts (b)		399		436		Net sales
Foreign exchange contracts (b)		( 41 )		( 75 )		Cost of sales

		358		361		Income before income taxes
Income tax impact		( 91 )		( 12 )		Provision for income taxes
		267		349		Net income
Defined benefit pension items



Amortization of defined benefit pension items (c)		( 1,056 )		( 1,230 )		Non-operating pension costs
		( 1,056 )		( 1,230 )		Income before income taxes
Income tax impact		247		255		Provision for income taxes
		( 809 )		( 975 )		Net income
Total reclassifications for the period		$	( 4,334 )	$	( 626 )	Net income

(a) See Note 4 for additional details.

(b) See Note 11 for additional details.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table summarizes the before and after tax amounts for the various components of other comprehensive income/(loss) for the three-month periods ended March 30, 2025 and March 31, 2024:


	Three Months Ended March 30, 2025						Three Months Ended March 31, 2024
	Before Tax Amount		Tax (Expense) Benefit		After Tax Amount		Before Tax Amount		Tax (Expense) Benefit		After Tax Amount
Foreign currency items:
Net other comprehensive income/(loss) from foreign currency items	$	161,828	$	10,244	$	172,072	$	( 16,788 )	$	( 2,531 )	$	( 19,319 )
Amounts reclassified from accumulated other comprehensive loss to net income (a)	3,792		—		3,792		—		—		—
Net other comprehensive income/(loss) from foreign currency items	165,620		10,244		175,864		( 16,788 )		( 2,531 )		( 19,319 )
Defined benefit pension items:
Other comprehensive income/(loss) before reclassifications	( 346 )		81		( 265 )		( 876 )		( 56 )		( 932 )
Amounts reclassified from accumulated other comprehensive loss to net income (b)	1,056		( 247 )		809		1,230		( 255 )		975
Net other comprehensive (loss)/income from defined benefit pension items	710		( 166 )		544		354		( 311 )		43
Gains and losses on cash flow hedges:
Other comprehensive (loss)/income before reclassifications	2,715		( 691 )		2,024		536		( 18 )		518
Amounts reclassified from accumulated other comprehensive loss to net income (c)	( 358 )		91		( 267 )		( 361 )		12		( 349 )

Net other comprehensive income/(loss) from cash flow hedges	2,357		( 600 )		1,757		175		( 6 )		169
Other comprehensive income/(loss)	$	168,687	$	9,478	$	178,165	$	( 16,259 )	$	( 2,848 )	$	( 19,107 )

(a) See Note 4 for additional details.

(b) See Note 13 for additional details.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 8: Goodwill and Other Intangible Assets

Goodwill

A summary of the changes in goodwill for the three-month period ended March 30, 2025 is as follows:


	Consumer Packaging		Industrial Paper Packaging		All Other		Total
Goodwill at December 31, 2024	$	1,807,971	$	486,636	$	231,050	$	2,525,657



Measurement period adjustments	595		—		—		595
Foreign currency translation	58,441		7,543		( 3,033 )		62,951
Goodwill at March 30, 2025	$	1,867,007	$	494,179	$	228,017	$	2,589,203

Goodwill activity reflected under the caption “Measurement period adjustments” relates to the prior year acquisition of Eviosys. See Note 4 for additional information.

The Company assesses goodwill for impairment annually during the third quarter, or from time to time when warranted by the facts and circumstances surrounding individual reporting units or the Company as a whole. The Company completed its most recent annual goodwill impairment testing during the third quarter of 2024 and analyzed certain qualitative and quantitative factors in determining whether a goodwill impairment existed. The Company’s assessments reflected a number of significant management assumptions and estimates including the Company’s forecast of sales growth, gross profit margins, and discount rates. Changes in these assumptions could materially impact the Company’s conclusions. Based on its assessments, the Company concluded that there was no impairment of goodwill for any of its reporting units.

Although no reporting units failed the annual impairment test, in management’s opinion, the goodwill balance of the Metal Packaging - US reporting unit is at risk of impairment in the near term if the reporting unit’s operations do not perform in line with management’s expectations, or if there is a negative change in the long-term financial outlook for the reporting unit or in other factors such as the discount rate. The total goodwill associated with the Metal Packaging - US reporting unit was $ 384,315 at March 30, 2025.

During the time subsequent to the annual evaluation, and at March 30, 2025, the Company considered whether any events and/or changes in circumstances had resulted in the likelihood that the goodwill of any of its reporting units may have been impaired. It is management’s opinion that no such events and/or changes in circumstances have occurred.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Other Intangible Assets

A summary of other intangible assets as of March 30, 2025 and December 31, 2024 is as follows:


	March 30, 2025		December 31, 2024
Other Intangible Assets, gross:
Patents	$	29,154	$	28,941
Customer lists	2,753,526		2,679,372
Trade names	39,253		38,623
Proprietary technology	229,475		226,936
Other	7,790		2,339
Total Other Intangible Assets, gross	$	3,059,198	$	2,976,211

Accumulated Amortization:
Patents	$	( 16,566 )	$	( 15,955 )
Customer lists	( 370,648 )		( 332,680 )
Trade names	( 14,236 )		( 13,239 )
Proprietary technology	( 32,080 )		( 26,203 )
Other	( 1,707 )		( 1,436 )
Total Accumulated Amortization	( 435,237 )		( 389,513 )
Other Intangible Assets, net	$	2,623,961	$	2,586,698

During the first quarter of 2025, the Company recorded measurement period adjustments related to the December 4, 2024 acquisition of Eviosys that reduced the previously reported fair value of customer lists by $ 5,253 . The effect on amortization expense in the prior period was immaterial. See Note 4 for additional information.

Other intangible assets are amortized using the straight-line method over their respective useful lives when management has determined that the straight-line method approximates the pattern of consumption of the respective intangible assets or in relation to the asset’s specific pattern of consumption if management has determined that the straight-line method does not provide a fair approximation of the consumption of benefits. These lives generally range from three to forty years . The Company has no intangible assets with indefinite lives.

Aggregate amortization expense was $ 41,961 and $ 17,894 for the three-month periods ended March 30, 2025 and March 31, 2024, respectively. Amortization expense on other intangible assets is expected to total approximately $ 169,900 in 2025, $ 168,300 in 2026, $ 167,600 in 2027, $ 167,400 in 2028 and $ 165,100 in 2029.

Note 9: Supply Chain Financing

The Company facilitates voluntary supply chain financing programs (the “SCF Programs”) to provide certain of its suppliers with the opportunity to sell receivables due from the Company to the participating financial institutions in the programs. Such sales are conducted at the sole discretion of both the suppliers and the financial institutions on a nonrecourse basis at a rate that leverages the Company’s credit rating and thus might be more beneficial to the supplier. No guarantees are provided by the Company or any of its subsidiaries under the SCF Programs. The Company’s responsibility under the agreements is limited to making payment to the financial institutions for confirmed invoices based on the terms originally negotiated with its suppliers. Both the Company and the financial institutions have the right to terminate the SCF Programs by providing 30 days prior written notice to the other party. The Company does not enter into any agreements with suppliers regarding their participation in the SCF Programs.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table sets forth the balance sheet location and values of the obligations under the Company’s SCF Programs at March 30, 2025 and December 31, 2024:


Balance Sheet Line Item	March 30, 2025		December 31, 2024
Payable to suppliers (a)	$	25,796	$	28,496

(a) The payment of these obligations is included in net cash provided by operating activities in the Company’s Condensed Consolidated Statements of Cash Flows.

Note 10: Debt

Details of the Company’s debt at March 30, 2025 and December 31, 2024 are as follows:


	March 30, 2025		December 31, 2024
Commercial paper	$	528,000	$	—
364-Day term loan due December 2025	1,495,787		1,493,568
Term loan due December 2026	698,459		698,167
Syndicated term loan due August 2028	497,832		497,674
1.800 % notes due February 2025	—		399,933
4.450 % notes due September 2026	497,327		496,869
2.250 % notes due February 2027	299,056		298,930
4.600 % notes due September 2029	594,806		594,519
3.125 % notes due May 2030	597,097		596,958
2.850 % notes due February 2032	496,429		496,302
5.000 % notes due September 2034	690,059		689,802
5.750 % notes due November 2040	536,290		536,282
Other foreign denominated debt	117,815		155,048
Finance lease obligations	59,875		67,628

Other debt	17,292		18,341
Total debt	7,126,124		7,040,021
Less: Notes payable and current portion of long-term debt	( 2,147,787 )		( 2,054,525 )
Long-term debt	$	4,978,337	$	4,985,496

Included in “Other foreign denominated debt” at March 30, 2025 and December 31, 2024 are $ 51,949 and $ 73,487 , respectively, of transfers of certain trade receivables of Eviosys to third-party financial institutions for which the requirements to be accounted for as true sale in accordance with the guidance under ASC 860, “Transfers and Servicing,” were not met. Additions to and settlements of these obligations are reflected as “Proceeds from issuance of debt” and “Principal repayment of debt,” respectively, in “Net cash provided/(used) by financing activities” in the Company’s Condensed Consolidated Statements of Cash Flows.

On February 3, 2025, the Company repaid the $ 400,000 aggregate principal amount of its 1.800 % notes due February 2025 upon maturity using proceeds from the issuance of commercial paper.

The Company maintains a revolving credit facility with total commitments of $ 1,250,000 and a maturity date of May 3, 2029. The Company’s $ 1,250,000 commercial paper program is supported by the revolving credit facility. At March 30, 2025 , the Company had $ 528,000 in commercial paper balances outstanding; accordingly, the committed capacity available for drawdown under its revolving credit facility at March 30, 2025 was $ 722,000 .

On April 1, 2025, subsequent to the end of the three-month period ended March 30, 2025 , the Company completed the sale of TFP. On April 3, 2025, the Company used a portion of the cash proceeds from the sale to repay the outstanding $ 1,500,000 principal amount of borrowings under its 364 -day term loan facility.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Certain of the Company’s debt agreements impose restrictions with respect to the maintenance of financial ratios and the disposition of assets. The most restrictive covenants currently require the Company to maintain a minimum level of interest coverage and a minimum level of net worth, as defined in the agreements. As of March 30, 2025, the Company’s interest coverage and net worth were substantially above the minimum levels required under these covenants.

Note 11: Financial Instruments and Derivatives

The following table sets forth the carrying amounts and fair values of the Company’s significant financial instruments for which the carrying amount differs from the fair value.


	March 30, 2025				December 31, 2024
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt, net of current portion	$	4,978,337	$	4,829,445	$	4,985,496	$	4,800,455

The carrying value of cash and cash equivalents and short-term debt approximates fair value. The fair value of long-term debt is determined based on recent trade information in the financial markets of the Company’s public debt or is determined by discounting future cash flows using interest rates available to the Company for issues with similar terms and maturities which is considered a Level 2 fair value measurement.

Cash Flow Hedges

At March 30, 2025 and December 31, 2024, the Company had derivative financial instruments outstanding to hedge anticipated transactions and certain asset and liability related cash flows. These contracts, w hich have maturities ranging from April 2025 to December 2025, qualify as cash flow hedges under GAAP. For derivative instruments that are designated and qualify as a cash flow hedge, the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings and is presented in the same income statement line item as the earnings effect of the hedged item. Cash flows from derivative financial instruments designated as cash flow hedges are classified as cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows.

Commodity Cash Flow Hedges

Certain derivative contracts entered into to manage the cost of anticipated purchases of natural gas and aluminum have been designated by the Company as cash flow hedges. At March 30, 2025, there were no natural gas swaps covering anticipated natural gas usage in 2025, and aluminum swaps covering 4,179 metric tons of aluminum represented approximately 38.0 % of anticipated aluminum usage for 2025. The fair value of the Company’s commodity cash flow hedges netted to gain positions of $ 116 and $ 652 at March 30, 2025 and December 31, 2024, respectively. The amount of the gain included in accumulated other comprehensive income at March 30, 2025 expected to be reclassified to the income statement during the next twelve months is $ 116 . The Company also has certain natural gas hedges that it does not treat as cash flow hedges. See “Non-Designated Derivatives” below for a discussion of these hedges.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Foreign Currency Cash Flow Hedges

The Company has entered into forward contracts to hedge certain anticipated foreign currency denominated sales and purchases expected to occur in 2025. The net positions of these contracts at March 30, 2025 were as follows (in thousands):


Currency	Action	Quantity
USD Contracts
Colombian peso	purchase	20,102,855
Mexican peso	purchase	297,228
Danish krone	purchase	120,270
Polish zloty	purchase	99,563
Czech koruna	purchase	87,666
Turkish lira	purchase	86,103
Euro	purchase	2,687
Canadian dollar	purchase	2,487
Swedish krona	sell	( 4,565 )
British pound	sell	( 4,428 )
Euro Contracts
Euro	purchase	29,132
British pound	sell	( 5,382 )
USD	sell	( 762 )
Hungarian forint	sell	( 4,336,028 )

The fair value of foreign currency cash flow hedges related to forecasted sales and purchases netted to a gain position of $ 1,120 and a loss position of $( 1,841 ) at March 30, 2025 and December 31, 2024, respectively. Gains of $ 1,120 are expected to be reclassified from accumulated other comprehensive income to the income statement during the next twelve months.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Net Investment Hedge

In 2023, the Company became a party to cross-currency swap agreements with a total notional amount of $ 500,000 to effectively convert a portion of the Company’s fixed-rate U.S. dollar denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt. The swap agreements, which had a maturity of December 18, 2026, provided for the Company to receive semi-annual interest payments in U.S. dollars at a fixed rate and to make semi-annual interest payments in euros at a fixed rate. The risk management objective of entering into the swap agreements was to manage foreign currency risk relating to net investments in certain European subsidiaries denominated in euros. The agreements were designated as net investment hedges for accounting purposes. On April 15, 2024, as a result of the strengthening of the U.S. dollar against the euro, as well as a reduction in the differential between U.S. and European interest rates, the Company terminated its swap agreements and received a net cash settlement of $ 9,068 . The foreign currency translation gain of approximately $ 3,143 , net of tax, is included as a component of “Accumulated other comprehensive loss.”

Following the unwind of the swaps, the Company entered into new cross-currency swap agreements with a total notional amount of $ 500,000 in April 2024 to effectively convert a portion of the Company’s fixed-rate U.S. dollar-denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt. The new swap agreements, which have a maturity of May 1, 2027, share the same risk management objective as the terminated cross-currency swap agreements and are also designated as net investment hedges for accounting purposes.

In December 2024, the Company entered into additional cross-currency swap agreements with a total notional amount of $ 1,500,000 , including $ 500,000 maturing on September 1, 2026, $ 500,000 maturing on September 1, 2029, and $ 500,000 maturing on May 1, 2030. The swaps effectively convert a portion of the Company’s fixed-rate U.S. dollar-denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt at the prevailing market rate at execution. The new swap agreements share the same risk management objective as the Company’s previously existing cross-currency swap agreements and are also designated as net investment hedges for accounting purposes.

The gain or loss on the net investment hedge derivative instruments is included in the “Foreign currency translation” component of “Accumulated other comprehensive loss” until the net investment is sold, diluted, or liquidated. Interest payments received for the cross-currency swaps are excluded from the net investment hedge effectiveness assessment and are recorded in “Interest expense” in the Company’s Condensed Consolidated Statements of Income. The assumptions used in measuring fair value of the cross-currency swaps are considered level 2 inputs, which are based upon the Euro-to-U.S. dollar exchange rate market.

The fair value of the Company’s net investment hedges was a loss position of $ 49,242 and a gain position of $ 11,919 at March 30, 2025 and December 31, 2024, respectively. A foreign currency translation loss of $ 36,685 (net of income taxes of $ 12,557 ) and a gain of $ 8,880 (net of income taxes of $ 3,039 ) were reported as components of “Accumulated other comprehensive loss” within “Foreign currency items” at March 30, 2025 and December 31, 2024, respectively.

Non-Designated Derivatives

The Company routinely enters into other derivative contracts which are not designated for hedge accounting treatment under ASC 815, “Derivatives and Hedging.” As such, changes in fair value of these non-designated derivatives are recorded directly to income and expense in the periods that they occur. Cash flows from derivative financial instruments not designated as hedges are classified as cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Foreign Currency Hedges

The Company routinely enters into forward contracts or swaps to economically hedge the currency exposure of intercompany debt and foreign currency denominated receivables and payables. The net currency positions of these non-designated contracts at March 30, 2025, were as follows (in thousands):


Currency	Action	Quantity
USD Contracts
Colombian peso	purchase	62,149,892
Mexican peso	purchase	282,395
Indonesian rupiah	purchase	14,957,473
Thai baht	sell	( 30,514 )
Euro	purchase	426
Canadian dollar	purchase	3,695
Euro Contracts
British pound	sell	( 99,984 )
Polish zloty	sell	( 51,255 )
Thai baht	sell	( 468,966 )

Commodity Hedges

The Company has entered into non-designated derivative contracts to manage the cost of a nticipated purchases of natural gas. At March 30, 2025, these contracts consisted of natural gas swaps covering approximately 3.8 million metric million British thermal units (“MMBTUs”) and represented approximately 74.5 % of anticipated usage in North America for the remainder of 2025.

The fair value of the Company’s non-designated deriva tives position was a gain of $ 2,955 and a loss of $( 2,694 ) at March 30, 2025 and December 31, 2024, respectively.

The following table sets forth the location and fair values of the Company’s derivative instruments at March 30, 2025 and December 31, 2024:


Description	Balance Sheet Location	March 30, 2025		December 31, 2024
Derivatives designated as hedging instruments:
Commodity Contracts	Prepaid expenses	$	344	$	671

Commodity Contracts	Accrued expenses and other	( 228 )		( 19 )

Foreign Exchange Contracts	Prepaid expenses	3,159		2,068

Foreign Exchange Contracts	Accrued expenses and other	( 2,039 )		( 3,909 )

Net investment hedge	Prepaid expenses	25,273		26,833
Net investment hedge	Other assets	—		1,845
Net investment hedge	Other liabilities	( 74,515 )		( 16,759 )
Derivatives not designated as hedging instruments:
Commodity Contracts	Prepaid expenses	$	3,476	$	961

Commodity Contracts	Accrued expenses and other	( 18 )		( 574 )

Foreign Exchange Contracts	Prepaid expenses	385		( 59 )

Foreign Exchange Contracts	Accrued expenses and other	( 888 )		( 3,022 )

While certain of the Company’s derivative contract arrangements with its counterparties provide for the ability to settle contracts on a net basis, the Company reports its derivative positions on a gross basis. There are no collateral arrangements or requirements in these agreements.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following tables set forth the effect of the Company’s derivative instruments on financial performance for the three-month periods ended March 30, 2025 and March 31, 2024, excluding the amount of foreign currency cash flow hedges that were reclassified from accumulated other comprehensive loss to the carrying value of the capitalized expenditures:


Description	Amount of Gain or (Loss) Recognized in OCI on Derivatives		Location of Gain or (Loss) Reclassified from Accumulated OCI Into Income	Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income
Derivatives in Cash Flow Hedging Relationships:
Three-month period ended March 30, 2025
Foreign Exchange Contracts	$	3,251	Net sales	$	399
			Cost of sales	( 41 )
Commodity Contracts	( 536 )		Cost of sales	—

Three-month period ended March 31, 2024
Foreign Exchange Contracts	$	561	Net sales	$	436
			Cost of sales	( 75 )
Commodity Contracts	( 25 )		Cost of sales	—

Description

Gain or (Loss)
Recognized

Location of Gain or (Loss) Recognized in
Income Statement

Derivatives not Designated as Hedging Instruments:

Three-month period ended March 30, 2025

Commodity Contracts

3,337

Cost of sales

Foreign Exchange Contracts

3,569

Selling, general and administrative

Three-month period ended March 31, 2024

Commodity Contracts

( 2,558 )

Cost of sales

Foreign Exchange Contracts

305

Selling, general and administrative



Description	Revenue		Cost of sales		Revenue		Cost of sales
Total amount of income and expense line items presented in the Condensed Consolidated Statements of Income	$	399	$	( 41 )	$	436	$	( 75 )

Gain or (loss) on cash flow hedging relationships:
Foreign exchange contracts:
Amount of gain or (loss) reclassified from accumulated other comprehensive loss into net income	$	399	$	( 41 )	$	436	$	( 75 )

Commodity contracts:
Amount of gain reclassified from accumulated other comprehensive loss into net income	$	—	$	—	$	—	$	—

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 12: Fair Value Measurements

Fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows:


Level 1 –			Observable inputs such as quoted market prices in active markets;
Level 2 –			Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
Level 3 –			Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions.

Assets that are calculated at Net Asset Value per share (“NAV”) are not required to be categorized within the fair value hierarchy.

The following table sets forth information regarding the Company’s financial assets and financial liabilities, excluding retirement and postretirement plan assets, measured at fair value on a recurring basis:


Description	March 30, 2025		Assets measured at NAV		Level 1		Level 2		Level 3

Hedge derivatives, net:
Commodity contracts	$	116	$	—	$	—	$	116	$	—
Foreign exchange contracts	1,120		—		—		1,120		—
Net investment hedge	( 49,242 )		—		—		( 49,242 )		—
Non-hedge derivatives, net:
Commodity contracts	3,458		—		—		3,458		—
Foreign exchange contracts	( 503 )		—		—		( 503 )		—

Description	December 31, 2024		Assets measured at NAV		Level 1		Level 2		Level 3
Hedge derivatives, net:
Commodity contracts	$	652	$	—	$	—	$	652	$	—
Foreign exchange contracts	( 1,841 )		—		—		( 1,841 )		—
Net investment hedge	11,919		—		—		11,919		—
Non-hedge derivatives, net:
Commodity contracts	387		—		—		387		—
Foreign exchange contracts	( 3,081 )		—		—		( 3,081 )		—

As discussed in Note 11 , the Company uses derivatives to mitigate the effect of commodity fluctuations, foreign currency fluctuations and, from time to time, interest rate movements. Fair value measurements for the Company’s derivatives are classified under Level 2 because such measurements are estimated based on observable inputs such as interest rates, yield curves, spot and future commodity prices and spot and future exchange rates.

None of the Company’s financial assets or liabilities are measured at fair value using significant unobservable inputs. There were no transfers in or out of Level 1 or Level 2 fair value measurements during the three-month period ended March 30, 2025.

The Company has an investment in the preferred stock of a nonaffiliated private company. This investment is accounted for under the measurement alternative of cost less impairment, adjusted for any qualifying observable price changes on a non-recurring basis. Observable price changes would consist of Lev el 2 inputs based on privately negotiated transactions with the nonaffiliated company. The total investment in p referred stock of $ 21,212 is included in “Other assets” in the Company’s Condensed Consolidated Balance Sheet as of March 30, 2025.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The Company measures certain non-financial assets and non-financial liabilities at fair value on a non-recurring basis. See Note 4 for a discussion of assets acquired and liabilities assumed in acquisitions and sold in dispositions, and Note 6 for a discussion of asset impairments associated with restructuring activities. The fair value of assets determined based on third-party appraisals and classified as Level 3 measurements due to the use of significant unobservable inputs was not material at March 30, 2025 or December 31, 2024.

Note 13: Employee Benefit Plans

Retirement Plans and Retiree Health and Life Insurance Plans

The Company provides non-contributory defined benefit pension plans for certain of its employees in the United States, Mexico, Belgium, Germany, France, and Turkey. Following the acquisition of Eviosys on December 4, 2024, the Company now also provides non-contributory defined benefit pension plans for certain of its employees in Italy, Switzerland, Spain, and Ireland. The Company also sponsors contributory defined benefit pension plans covering certain of its employees in the United Kingdom, Canada and the Netherlands, and provides postretirement healthcare and life insurance benefits to a limited number of its retirees and their dependents in the United States and Canada, based on certain age and/or service eligibility requirements.

The components of net periodic benefit cost include the following:


	Three Months Ended
		March 30, 2025		March 31, 2024
Retirement Plans
Service cost		$	1,196	$	755
Interest cost		5,133		4,709
Expected return on plan assets		( 3,205 )		( 2,796 )
Amortization of prior service cost		188		205
Amortization of net actuarial loss		988		1,075


Net periodic benefit cost		$	4,300	$	3,948

Retiree Health and Life Insurance Plans
Service cost		$	39	$	54
Interest cost		237		250
Expected return on plan assets		( 100 )		( 98 )
Amortization of prior service credit		94		96
Amortization of net actuarial gain		( 214 )		( 146 )
Net periodic benefit cost		$	56	$	156

Contributions

The Company made aggregate contributions of $ 4,223 and $ 3,989 to its defined benefit retirement and retiree health and life insurance plans during the three-month periods ended March 30, 2025 and March 31, 2024, respectively. The Company expects to make additional aggregate contributions of approximately $ 18,800 to its defined benefit retirement and retiree health and life insurance plans over the remainder of 2025.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Note 14: Income Taxes

The Company’s effective tax rates for the three-month periods ended March 30, 2025 and March 31, 2024 were 30.9 % and 18.6 %, respectively. The Company’s effective tax rates varied from the U.S. statutory rate due primarily to rate differences between U.S. and non-U.S. jurisdictions and the relative amounts earned in those jurisdictions, state income taxes, and discrete tax adjustments that were not consistent year over year.

The Company and/or its subsidiaries file federal, state and local income tax returns in the United States and various foreign jurisdictions. With few exceptions, the Company is no longer subject to income tax examinations by tax authorities for years prior to 2019.

The Company’s reserve for uncertain tax benefits decreased by $ 358 from December 31, 2024 to March 30, 2025 due primarily to a decrease in reserves related to existing tax positions. Although the Company’s estimate for the potential outcome for any uncertain tax issue is highly judgmental, management believes that any reasonably foreseeable outcomes related to these matters have been adequately provided for. However, future results may include favorable or unfavorable adjustments to estimated tax liabilities in the period the assessments are made or resolved or when statutes of limitation on potential assessments expire. Additionally, the jurisdictions in which earnings or deductions are realized may differ from current estimates. As a result, the Company’s effective tax rate may fluctuate significantly on a quarterly basis. The Company has operations and pays taxes in many countries outside of the U.S. and taxes on those earnings are subject to varying rates. The Company is not dependent upon the favorable benefit of any one jurisdiction to an extent that the loss of such benefit would have a material effect on the Company’s overall effective tax rate.

Note 15: Leases

The Company routinely enters into leasing arrangements for real estate (including manufacturing facilities, office space, and warehouses), transportation equipment (automobiles, forklifts, and trailers), and office equipment (copiers and postage machines). The assessment of the certainty associated with the exercise of various lease renewal, termination, and purchase options included in the Company’s lease contracts is performed after contemplating all the relevant facts and circumstances in accordance with guidance under ASC 842, “Leases.” Most of the Company’s real estate leases, in particular, include one or more options to renew, with renewal terms that typically extend the lease term in increments from one to five years . The Company’s leases do not have any significant residual value guarantees or restrictive covenants.

As the implicit rate in the Company’s leases is normally not readily determinable, the Company generally calculates its lease liabilities using discount rates based upon the Company’s incremental secured borrowing rate, which contemplates and reflects a particular geographical region’s interest rate for the leases active within that region of the Company’s global operations. The Company further utilizes a portfolio approach by assigning a “short” rate to contracts with lease terms of 10 years or less and a “long” rate for contracts greater than 10 years.

The Company completed the Eviosys acquisition on December 4, 2024. The acquisition included operating lease liabilities of $ 42,468 with a weighted-average remaining lease maturity term of 8.1 years and a weighted-average discount rate of 4.5 % . For additional information about this acquisition, see Note 4.

The following table sets forth the balance sheet location and aggregate values of the Company’s lease assets and lease liabilities at March 30, 2025 and December 31, 2024:

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)


Classification	Balance Sheet Location	March 30, 2025		December 31, 2024
Lease Assets
Operating lease assets	Right of Use Asset - Operating Leases	$	329,601	$	307,688
Finance lease assets	Other Assets	64,224		76,831
Total lease assets		$	393,825	$	384,519

Lease Liabilities
Current operating lease liabilities	Accrued expenses and other	$	57,123	$	52,648
Current finance lease liabilities	Notes payable and current portion of long-term debt	24,373		22,284
Total current lease liabilities		$	81,496	$	74,932

Noncurrent operating lease liabilities	Noncurrent Operating Lease Liabilities	$	277,932	$	258,735
Noncurrent finance lease liabilities	Long-term Debt, net of current portion	35,502		45,344
Total noncurrent lease liabilities		$	313,434	$	304,079

Total lease liabilities		$	394,930	$	379,011

Certain of the Company’s leases include variable costs. Variable costs include lease payments that were volume or usage-driven in accordance with the use of the underlying asset, and also non-lease components that were incurred based upon actual terms rather than contractually fixed amounts. In addition, variable costs are incurred for lease payments that are indexed to a change in rate or index. Because the right of use assets recorded on the balance sheet were determined based upon factors considered at the commencement date of the leases, subsequent changes in the rate or index that were not contemplated in the right of use asset balances recorded on the balance sheet for certain leases with rate or index-related terms result in variable expenses being incurred when paid during the lease term.

The following table sets forth the components of the Company’s total lease cost for the three-month periods ended March 30, 2025 and March 31, 2024:


		Three Months Ended
Lease Cost		March 30, 2025		March 31, 2024
Operating lease cost	(a)	$	15,484	$	13,370
Finance lease cost:
Amortization of lease asset	(a)	3,002		3,085
Interest on lease liabilities	(b)	700		921
Variable lease cost	(a) (c)	12,422		6,597
Impairment charges	(d)	633		—
Total lease cost		$	32,241	$	23,973

(a) Production-related costs are included in “Cost of sales” and administrative costs are included in “Selling, general and administrative expenses” in the Condensed Consolidated Statements of Income.

(b) Included in “Interest expense” in the Condensed Consolidated Statements of Income.

(d) Impairment charges are included in “Restructuring/asset impairment charges” in the Company’s Condensed Consolidated Statements of Income. See Note 6 for additional information.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table sets forth certain lease-related information for the three-month periods ended March 30, 2025 and March 31, 2024:


	Three Months Ended
	March 30, 2025		March 31, 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used by operating leases	$	14,226	$	11,411
Operating cash flows used by finance leases	$	700	$	921
Financing cash flows used by finance leases	$	3,057	$	3,684
Noncash investing and financing activities:
Leased assets obtained in exchange for new operating lease liabilities	$	11,011	$	26,432
Leased assets obtained in exchange for new finance lease liabilities	$	2,279	$	2,042
Modification to leased assets for increase in operating lease liabilities	$	16,626	$	4,171
Modification to leased assets for increase/(decrease) in finance lease liabilities	$	( 10,440 )	$	—
Termination reclasses to decrease operating lease assets	$	( 232 )	$	( 1,103 )
Termination reclasses to decrease operating lease liabilities	$	( 274 )	$	( 1,316 )
Termination reclasses to decrease finance lease assets	$	( 82 )	$	—
Termination reclasses to decrease finance lease liabilities	$	( 84 )	$	—

Note 16: Revenue Recognition

The Company records revenue when control is transferred to the customer, which is either upon shipment or over time in cases where the Company is entitled to payment with margin for products produced that are customer specific without alternative use. The Company recognizes over time revenue under the input method as goods are produced. Revenue that is recognized at a point in time is recognized when the customer obtains control of the goods. Customers obtain control either when goods are delivered to the customer facility, if the Company is responsible for arranging transportation, or when picked up by the customer’s designated carrier. The Company commonly enters into Master Supply Arrangements with customers to provide goods and/or services over specific time periods. Customers submit purchase orders with quantities and prices to create a contract for accounting purposes. Shipping and handling expenses are included in “Cost of sales,” and freight charged to customers is included in “Net sales” in the Company’s Condensed Consolidated Statements of Income.

The Company has rebate agreements with certain customers. These rebates are recorded as reductions of revenue and are accrued using sales data and rebate percentages specific to each customer agreement. Accrued customer rebates are included in “Accrued expenses and other” in the Company’s Condensed Consolidated Balance Sheets.

Payment terms under the Company’s sales arrangements are short term, generally no longer than 120 days. The Company does provide prompt payment discounts to certain customers if invoices are paid within a predetermined period. Prompt payment discounts are treated as a reduction of estimated revenue and are determinable within a short time period following the sale.

The following table sets forth the effects of contract assets and liabilities from contracts with customers. Contract assets and liabilities are reported in “Other receivables” and “Accrued expenses and other,” respectively, in the Company’s Condensed Consolidated Balance Sheets.


	March 30, 2025		December 31, 2024

Contract Assets	$	80,294	$	67,062
Contract Liabilities	( 43,428 )		( 60,024 )

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

Significant changes in the contract assets and liabilities balances during the three-month period ended March 30, 2025 and the year ended December 31, 2024 were as follows:


	March 30, 2025				December 31, 2024
	Contract Asset		Contract Liability		Contract Asset		Contract Liability
Beginning Balance	$	67,062	$	( 60,024 )	$	14,754	$	( 15,252 )
Acquired as part of a business combination	—		—		62,439		( 47,478 )
Revenue deferred or rebates accrued	—		( 11,812 )		—		( 25,736 )
Recognized as revenue	—		500		—		2,341
Rebates paid to customers	—		27,908		—		26,101
Increases due to rights to consideration for customer specific goods produced, but not billed during the period	80,294		—		67,062		—
Transferred to receivables from contract assets recognized at the beginning of the period and acquired as part of business combination	( 67,062 )		—		( 77,193 )		—



Ending Balance	$	80,294	$	( 43,428 )	$	67,062	$	( 60,024 )

Contract assets represent goods produced without alternative use for which the Company is entitled to payment with margin prior to shipment. Upon shipment, the Company is entitled to bill the customer, and therefore amounts included in contract assets will be reduced with the recording of an account receivable as they represent an unconditional right to payment. Contract liabilities represent revenue deferred due to pricing mechanisms utilized by the Company in certain multi-year arrangements, volume rebates, and receipts of advance payments. For multi-year arrangements with pricing mechanisms, the Company will generally defer revenue during the first half of the arrangement and will release the deferral over the second half of the contract term. Contract assets and liabilities are generally short in duration given the nature of products produced by the Company.

The following tables set forth information about revenue disaggregated by primary geographic regions for the three-month periods ended March 30, 2025 and March 31, 2024. The tables also include a reconciliation of disaggregated revenue with reportable segments. The Company’s reportable segments are aligned by product nature as disclosed in Note 17 .


Three-month period ended March 30, 2025	Consumer Packaging		Industrial Paper Packaging		All Other		Total
Primary Geographical Markets:
United States	$	448,034	$	357,586	$	69,478	$	875,098
Europe, Middle East and Africa (EMEA)	567,024		86,109		14,473		667,606
Canada	3,865		21,434		—		25,299
Asia Pacific	24,639		35,837		251		60,727
Other	23,031		56,743		724		80,498
Total	$	1,066,593	$	557,709	$	84,926	$	1,709,228

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)


Three-month period ended March 31, 2024	Consumer Packaging		Industrial Paper Packaging		All Other		Total
Primary Geographical Markets:
United States	$	422,592	$	354,366	$	109,568	$	886,526
Europe, Middle East and Africa (EMEA)	105,136		97,700		14,390		217,226
Canada	3,903		24,770		—		28,673
Asia Pacific	24,463		56,950		354		81,767
Other	25,576		59,274		9,594		94,444
Total	$	581,670	$	593,060	$	133,906	$	1,308,636

Note 17: Segment Reporting

The Company’s operating and reporting structure consists of two reportable segments, Consumer Packaging and Industrial Paper Packaging, with all remaining businesses reported as All Other.

The primary products produced and sold within the Industrial Paper Packaging segment include paperboard tubes, cones, and cores; paper-based protective packaging; and uncoated recycled paperboard.

The primary products produced within the All Other group of businesses consist of a variety of packaging materials, including plastic, paper, foam, and various other specialty materials.

The Company’s chief operating decision maker (“CODM”) is the chief executive officer. The CODM assesses segment performance and allocates resources to each segment by using each segment’s operating profit. The CODM uses operating profit for each segment in the annual budgeting and forecasting process and reviews segment operating profit quarterly when making decisions about allocating capital and operating resources to segments. Disaggregated assets by segment are not disclosed since segment assets are not regularly provided to the CODM.

Segment operating profit viewed by the Company to evaluate segment performance does not include the following: restructuring/asset impairment charges; amortization of acquisition intangibles; gains/losses from the sale of businesses or other assets; acquisition, integration and divestiture-related costs; changes in last-in, first-out (“LIFO”) inventory reserves; derivative gains/losses; or certain other items, if any, the exclusion of which the Company’s management believes improves the comparability and analysis of the ongoing operating performance of the business. All other general corporate expenses have been allocated as operating costs to each of the Company’s reportable segments and the All Other group of businesses, except for costs related to discontinued operations.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table sets forth financial information about each of the Company’s reportable segments:


SEGMENT FINANCIAL INFORMATION
Three-month period ended March 30, 2025	Consumer Packaging		Industrial Paper Packaging		Total Reportable Segments
Sales from external customers	$	1,066,593	$	557,709	$	1,624,302
Intersegment sales (1)	2,769		27,015		29,784
	$	1,069,362	$	584,724	$	1,654,086
Reconciliation of sales
Other sales (2)					86,289
Elimination of intersegment sales					( 31,147 )
Total consolidated sales					$	1,709,228
Less: (3)
Cost of sales (4)	( 853,732 )		( 421,983 )
Other segment items (5)	( 74,859 )		( 91,617 )
Segment operating profit	$	140,771	$	71,124	$	211,895

Other segment disclosures:
Equity in (loss)/earnings of affiliates, net of tax	$	( 51 )	$	1,972
Depreciation, depletion and amortization (6)	$	48,955	$	28,333


(1)			Intersegment sales are recorded at a market-related transfer price.
(2)			Sales from businesses below the quantitative threshold are attributable to the group of businesses within All Other.
(3)			The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(4)			Cost of sales of reportable segments excludes certain costs, primarily changes in LIFO inventory reserves, net gains or losses from derivatives, and acquisition, integration and divestiture-related costs.
(5)			Other segment items consists of:
			Consumer Packaging: Labor and benefits, consulting and professional services, travel, communication, facilities and supplies. Industrial Paper Packaging: Labor and benefits, consulting and professional services, travel, communication, facilities and supplies.
(6)			Represents significant segment expenses that are regularly provided to the CODM and are included in cost of sales and other segment items within segment operating profit.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)


Three-month period ended March 31, 2024	Consumer Packaging		Industrial Paper Packaging		Total Reportable Segments
Sales from external customers	$	581,670	$	593,060	$	1,174,730
Intersegment sales (1)	1,775		28,417		$	30,192
	$	583,445	$	621,477	$	1,204,922
Reconciliation of sales
Other sales (2)					135,697
Elimination of intersegment sales					( 31,983 )
Total consolidated sales					$	1,308,636
Less: (3)
Cost of sales (4)	( 479,490 )		( 459,134 )
Other segment items (5)	( 45,388 )		( 96,499 )
Segment operating profit	$	58,567	$	65,844	$	124,411

Other segment disclosures:
Equity in earnings of affiliates, net of tax	$	13	$	1,124
Depreciation, depletion and amortization (6)	$	24,897	$	28,503


(1)			Intersegment sales are recorded at a market-related transfer price.
(2)			Sales from businesses below the quantitative threshold are attributable to the group of businesses within All Other.
(3)			The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
(4)			Cost of sales of reportable segments excludes certain costs, primarily changes in LIFO inventory reserves, net gains or losses from derivatives, and acquisition, integration and divestiture-related costs.
(5)			Other segment items consists of:
			Consumer Packaging: Labor and benefits, consulting and professional services, travel, communication, facilities and supplies. Industrial Paper Packaging: Labor and benefits, consulting and professional services, travel, communication, facilities and supplies.
(6)			Represents significant segment expenses that are regularly provided to the CODM and are included in cost of sales and other segment items within segment operating profit.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table sets forth the reconciliation of segment operating profit to “Income from continuing operations before income taxes” for the periods presented.



	Three Months Ended
		March 30, 2025		March 31, 2024
Segment operating profit		$	211,895	$	124,411
Other operating profits (1)		11,926		17,125
Unallocated amounts:
Restructuring/Asset impairment charges		( 13,581 )		( 31,010 )
Amortization of acquisition intangibles		( 41,961 )		( 17,894 )
Loss from divestiture of business and other assets		( 4,183 )		—
Acquisition, integration and divestiture-related costs		( 27,266 )		( 5,504 )
Changes in LIFO inventory reserves		( 562 )		( 431 )
Derivative gains		2,949		286
Other corporate costs (2)		( 11,098 )		( 11,088 )
Other operating charges, net (3)		( 1,259 )		( 3,323 )
Other expenses, net (4)		( 6,517 )		—
Non-operating pension costs		( 3,121 )		( 3,295 )
Interest expense		( 56,027 )		( 30,164 )
Interest income		7,348		3,133
Income from continuing operations before income taxes		$	68,543	$	42,246


(1)			Operating profit from segments below the quantitative threshold are attributable to the group of businesses within All Other.
(2)			Other corporate costs represent recurring operating expenses previously allocated to TFP that will remain with Sonoco subsequent to the divestiture.
(3)			Primarily consists of highly inflationary accounting in Turkey and other miscellaneous charges in both 2025 and 2024.
(4)			These expenses relate to charges from third-party financial institutions related to the Company’s centralized treasury program under which the Company sells certain trade accounts receivables in order to accelerate its cash collection cycle, primarily within the Consumer Packaging segment.

SONOCO PRODUCTS COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands except per share data)

(unaudited)

The following table sets forth the reconciliation of other segment disclosures to consolidated totals for the periods presented.


	Three Months Ended
	March 30, 2025		March 31, 2024
Equity in (loss)/earnings of affiliates, net of tax
Consumer Packaging	$	( 51 )	$	13
Industrial Paper Packaging	1,972		1,124
Reportable Segment Total	1,921		1,137
Adjustments	—		—
Consolidated Total	$	1,921	$	1,137

Depreciation, depletion and amortization
Consumer Packaging	$	48,955	$	24,897
Industrial Paper Packaging	28,333		28,503
Reportable Segment Total	77,288		53,400
Other (1)	44,515		21,546
Consolidated Total	$	121,803	$	74,946


(1)			Other represents depreciation, depletion and amortization expense for the All Other group of businesses and total amortization of acquisition intangibles for Sonoco, excluding discontinued operations.

Note 18: Commitments and Contingencies

In accordance with the requirements of ASC 450, “Contingencies,” the Company records accruals for estimated losses at the time information becomes available indicating that losses are probable and that the amounts are reasonably estimable. As is the case with other companies in similar industries, the Company faces exposure from actual or potential claims and legal proceedings from a variety of sources. Some of these exposures, as discussed below, have the potential to be material.

Environmental Matters

The Company is subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which it operates.

Spartanburg

In connection with its acquisition of Tegrant in November 2011, the Co mpany identified potential environmental contamination at a site in Spartanburg, South Carolina. Since the acquisition, the Company has spent a total of $ 2,345 on remediation of the Spartanburg site. At March 30, 2025 and December 31, 2024, the Company’s accrual for environmental contingencies related to the Spartanburg site totaled $ 5,055 and $ 5,096 , respectively. The Spartanburg site and related environmental liabilities were part of the sale of TFP to Toppan, which was completed on April 1, 2025, subsequent to the end of the first quarter. Accordingly, these accruals are reflected in “Current liabilities of discontinued operations” on the Company’s Condensed Consolidated Balance Sheets.

Other environmental matters

The Company has been named as a potentially responsible party at several other environmentally contaminated sites. All of the sites are also the responsibility of other parties. The potential remediation liabilities are shared with such other parties, and, in most cases, the Company’s share, if any, cannot be reasonably estimated at the current time. However, the Company does not believe that the resolution of these matters has a reasonable possibility of having a material adverse effect on the Company’s fi nancial statements. At March 30, 2025 and December 31, 2024, the Company’s accrual for these other sites totaled $ 1,807 and $ 1,933 , respectively , and are included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets.

SONOCO PRODUCTS COMPANY

Other Legal Matters

In addition to those matters described above, the Company is subject to other various legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters could differ from management’s expectations, the Company does not believe the resolution of these matters has a reasonable possibility of having a material adverse effect on the Company’s financial statements.

SONOCO PRODUCTS COMPANY


Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations.

FORWARD LOOKING STATEMENTS

Statements included in this Quarterly Report on Form 10-Q that are not historical in nature, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition, Sonoco Products Company (the “Company” or “Sonoco”) and its representatives may from time to time make other oral or written statements that are also “forward-looking statements.” Words such as “aim,” “anticipate,” “assume,” “believe,” “can,” “committed,” “consider,” “continue,” “could,” “develop,” “estimate,” “expect,” “forecast,” “foresee,” “future,” “goal,” “guidance,” “intend,” “is designed to,” “likely,” “maintain,” “may,” “might,” “objective,” “ongoing,” “opportunity,” “outlook,” “plan,” “possible,” “potential,” “predict,” “project,” “seek,” “strategy,” “target,” “will,” “would,” or the negative thereof, and similar expressions identify forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding:

• availability and supply of raw materials and energy, and offsetting high raw material and energy costs;

• the effects of economic downturns, tariffs or other changes in trade policy, inflation, volatility and other macroeconomic factors on the Company and its industry, including the Company’s ability to manage such matters and their effects on consumers and customers;

• the resiliency of the Company’s operating model;

• supply chain disruptions;

• consumer and customer actions in connection with political, social, and economic instability, war and other geopolitical tensions;

• improved productivity and cost containment;

• the Company’s acquisition of Titan Holdings I B.V. (“Eviosys”) and the anticipated benefits of the acquisition, including with respect to market leadership, strategic alignment, customer relationships, sustainability, innovation and cost synergies;

• effects and timing of, and anticipated costs, synergies and gains resulting from our other contemplated, pending, and completed acquisitions, including the Company’s acquisitions of Ball Metalpack Holding, LLC, renamed Sonoco Metal Packaging, the remaining ownership interest in RTS Packaging, LLC, a paper mill in Chattanooga, Tennessee, and Inapel Embalagens Ltda.;

• effects and timing of, and anticipated gains and costs, of the Company’s restructuring and portfolio simplification activities, including with respect to streamlining of the Company’s organizational structure and the Company’s contemplated, pending, and completed divestitures, including the Company’s sale of its Thermoformed and Flexibles Packaging business and its global Trident business (collectively, “TFP”), its Protective Solutions business (“Protexic”), and two production facilities in China, and the potential divestiture of the Company’s ThermoSafe business;

• adequacy and anticipated amounts and uses of cash flows;

• capital allocation, including expected amounts of capital spending;

• the Company’s capital structure, including the incurrence of debt and the repayment of debt;

• the Company’s ability to adhere to restrictive covenants in its debt agreements;

• financial and business strategies and the results expected of them;

• producing improvements in earnings;

• profitable sales growth and rates of growth;

• market opportunities and anticipated growth thereof;

• expected impact and costs of resolution of legal proceedings;

• extent of, and adequacy of provisions for, environmental liabilities;

• adequacy of income tax provisions, realization of deferred tax assets, outcomes of uncertain tax issues and tax rates;

• goodwill impairment charges and fair values of reporting units;

• future asset impairment charges and fair values of assets;

• anticipated contributions to pension and postretirement benefit plans, fair values of plan assets, long-term rates of return on plan assets, and projected benefit obligations and payments;

• expected impact of implementation of new accounting pronouncements;

• creation of near-term and long-term value and returns for shareholders;

SONOCO PRODUCTS COMPANY

• continued payment of dividends; and

• planned stock repurchases.

Such forward-looking statements are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management. Such information includes, without limitation, discussions as to guidance and other estimates, perceived opportunities, expectations, beliefs, plans, strategies, goals and objectives concerning our future financial and operating performance. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results may differ materially from those expressed or forecasted in such forward-looking statements. Such risks, uncertainties and assumptions include, without limitation:

• ability to manage the mix of business and execute on the Company’s portfolio simplification strategy, including with respect to divestitures, such as the potential divestiture of its ThermoSafe business;

• ability to identify suitable acquisitions at the levels needed to meet growth targets;

• ability to satisfy closing conditions and close acquisitions, and to finance such acquisitions on acceptable terms;

• ability to successfully integrate newly acquired businesses, including Eviosys, into the Company’s operations, retain key employees, and realize expected cost savings, synergies and other anticipated benefits relating thereto within the expected time period, or at all;

• the potential impact of acquisitions, including the acquisition of Eviosys, on relationships with customers and other third parties;

• availability, transportation and pricing of raw materials, energy and transportation, including the impact of changes in tariffs or sanctions and escalating trade wars, and the impact of war, general regional instability and other geopolitical tensions (such as the ongoing conflict between Russia and Ukraine as well as the economic sanctions related thereto, and the ongoing conflicts in the Middle East), and the Company’s ability to pass raw material, energy and transportation price increases and surcharges through to customers or otherwise manage these commodity pricing risks;

• costs of labor;

• work stoppages due to labor disputes;

• success of new product development, introduction and sales, including successful timing of new product or product innovation introductions;

• success of implementation of new manufacturing technologies and installation of manufacturing equipment, including the startup of new facilities and lines;

• consumer demand for products and changing consumer preferences, including changes related to inflation, tariffs, and other macroeconomic factors;

• ability to be the low-cost global leader in customer-preferred packaging solutions within targeted segments;

• competitive pressures, including new product development, and technological market leadership, reputation for quality, industry overcapacity, customer and supplier consolidation, and changes in competitors’ pricing for products;

• financial conditions of customers and suppliers;

• ability to maintain or increase productivity levels, contain or reduce costs, and maintain positive price/cost relationships;

• ability to negotiate or retain contracts with customers, including in segments with concentration of sales volume;

• inventory management strategies of customers;

• collection of receivables from customers;

• ability to maintain or improve margins and leverage cash flows and financial position;

• ability to attract and retain talented and qualified employees, managers, and executives;

• ability to profitably maintain and grow existing domestic and international business and market share;

• availability of credit to us, our customers and suppliers in needed amounts and on reasonable terms;

• effects of our indebtedness on our cash flow and business activities;

• fluctuations in interest rates and our borrowing costs;

• fluctuations in obligations and earnings of pension and postretirement benefit plans, including the timing of funding plan obligations, and the accuracy of assumptions of underlying projections of benefit plan obligations and payments, valuation of plan assets, and projections of long-term rates of return;

• foreign currency exchange rate fluctuations, interest rate and commodity price risk and the effectiveness of related hedges;

• cost of employee and retiree medical, health, and life insurance benefits;

SONOCO PRODUCTS COMPANY

• resolution of income tax contingencies;

• changes in U.S. and foreign tariffs, tax rates, tax laws, regulations and interpretations thereof, including income, sales and use, property, value added, employment, and other taxes;

• accuracy in valuation of deferred tax assets;

• the adoption of new, or changes in, accounting standards or interpretations;

• accuracy of assumptions underlying projections related to goodwill impairment testing, and accuracy of management’s assessment of goodwill impairment;

• accuracy of assumptions underlying fair value measurements, accuracy of management’s assessments of fair value and fluctuations in fair value;

• ability to maintain effective disclosure controls and internal controls, including with regard to financial reporting, to prevent or detect errors or acts of fraud;

• liability for and costs of resolution of litigation, regulatory actions, or other legal proceedings;

• liability for and anticipated costs of environmental remediation actions;

• effects of environmental laws and regulations, including with respect to climate change and emissions reporting;

• operational disruptions at our major facilities;

• failure or disruptions in our information technology systems;

• loss of consumer or investor confidence;

• ability to protect our intellectual property rights;

• changes in laws and regulations relating to packaging for food products and foods packaged therein, other actions and public concerns about products packaged in our containers, or chemicals or substances used in raw materials or in the manufacturing process;

• changing consumer attitudes toward plastic packaging;

• changing climate and greenhouse gas effects;

• ability to meet environmental, sustainability and other similar goals;

• actions of domestic or foreign government agencies, the impact of new and evolving laws, regulations, rules and standards affecting the Company, and increased costs of compliance;

• international, national, and local economic and market conditions and levels of unemployment;

• economic disruptions resulting from changing tariff policies and trade wars, war, and other geopolitical tensions (such as the ongoing military conflict between Russia and Ukraine and the ongoing conflicts in the Middle East), public health events, terrorist activities, and natural disasters; and

• inflation and the activities and operations in highly inflationary economies.

More information about the risks, uncertainties, and assumptions that may cause actual results to differ materially from those expressed or forecasted in forward-looking statements is provided in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 under Item 1A - “Risk Factors” and throughout other sections of that report and in other reports filed with the Securities and Exchange Commission. In light of these various risks, uncertainties and assumptions, the forward-looking events discussed in this Quarterly Report on Form 10-Q might not occur.

The Company undertakes no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law. You are, however, advised to review any further disclosures we make on related subjects, and about new or additional risks, uncertainties and assumptions, in our future filings with the Securities and Exchange Commission on Forms 10-K, 10-Q, and 8-K.

SONOCO PRODUCTS COMPANY

COMPANY OVERVIEW

Sonoco is now a multi-billion dollar global designer, developer, and manufacturer of a variety of highly engineered and sustainable packaging products serving multiple end markets serving some of the world’s best-known brands around the globe from approximately 285 locations in 40 countries. The Company’s operating and reporting structure consists of two reportable segments, Consumer Packaging and Industrial Paper Packaging, with all remaining businesses reported as All Other.

Sonoco competes in multiple product categories, with the majority of the Company’s revenues attributable to products and services sold to consumer and industrial products companies for use in the packaging of their products for sale or shipment. The Company also manufactures uncoated recycled paperboard for both internal use and open market sale. Each of the Company’s operating units has its own sales staff and maintains direct sales relationships with its customers.

Sonoco’s goal is to increase its long-term profitability and return capital to shareholders. Over the past several years, we have simplified our portfolio around fewer, bigger businesses, which has reduced operating complexity and improved agility. On December 4, 2024, Sonoco completed the acquisition of Eviosys, Europe’s leading food cans, ends and closures manufacturer, from KPS Capital Partners, LP, for net cash consideration of approximately $3.8 billion. The transaction advances Sonoco’s portfolio transformation strategy to simplify and realign its portfolio and position the Company for long-term growth and value creation. The transaction, the largest in the Company’s history, expands Sonoco’s global leadership in metal food can and aerosol packaging and facilitates our ability to partner with global customers to advance innovation and sustainability in metal packaging offerings. During 2025, Eviosys will complete its transition to the Sonoco brand and operate under the Consumer Packaging segment.

Sonoco’s portfolio transformation strategy also includes significant divestitures. For example, on April 1, 2025, subsequent to the end of the first quarter, the Company completed the sale of TFP to TOPPAN Holdings Inc. (“Toppan”) for a purchase price of approximately $1.8 billion on a cash-free and debt-free basis and subject to customary adjustments. On a standalone basis, TFP had revenue of $1.3 billion in 2024.

As previously disclosed, the Company initiated a review of strategic alternatives for ThermoSafe, its leading temperature-assured packaging business. On a standalone basis, ThermoSafe, which is part of the All Other group of businesses, had revenue of $245 million in 2024. The Company expects to complete its review of strategic alternatives for ThermoSafe in the second half of 2025.

The Company believes that these completed and potential divestitures will enable greater strategic and operational focus while also generating proceeds to fund deleveraging and further focus capital investments in our core Consumer Packaging and Industrial Paper Packaging businesses.

The Company is focused on efficient capital deployment into these larger, core business units to improve economic returns and improve integration effectiveness and speed for acquired strategic assets. In parallel, the Company continues to work on commercial, operational, and supply chain excellence programs to shift the mix of its business towards higher-valued products and increase overall productivity from procurement savings, production efficiencies, and fixed cost reduction initiatives, as well as strategic pricing initiatives intended to better capture input costs and the value of the services provided.

Global Trade Developments

Recent developments in U.S. and foreign trade policy have increased uncertainty for the global economy and the Company’s business. On March 4, 2025, the U.S. Government (the “Administration”) imposed a 25% tariff on all imports from Canada or Mexico. After imposing this tariff, the Administration allowed for the temporary exemption from the tariff for any goods that comply with the United States-Mexico-Canada Agreement (“USMCA”), which has helped mitigate the impact of the tariff on the Company’s operations in North America. On February 10, 2025, the Administration announced the expansion of Section 232 steel and aluminum tariffs (“Section 232 Tariffs”) on steel and aluminum imported into the United States, effective March 12, 2025, and the termination of the granting of new exclusions to mitigate these tariffs. As a result, imported steel and aluminum is now subject to a 25% duty.

Further, on April 2, 2025, the Administration announced an across-the-board 10% tariff on imported goods from most countries, with materially higher tariffs imposed on many of the countries, as well as other trade policy changes. The Administration subsequently suspended the implementation of certain of these trade policy changes, with many of the affected countries expected to negotiate separate trade agreements with the Administration during the suspension. In response to the Administration’s tariff actions, some countries have announced additional trade measures, including

SONOCO PRODUCTS COMPANY

reciprocal tariffs, which may continue to give rise to further escalations of trade measures by the United States and impacted countries. Canada has imposed retaliatory tariffs on goods coming from the United States, including a 25% tariff on a variety of enumerated goods on March 4 and March 13, 2025. At the same time, Canada has not exempted USMCA-qualified goods from these tariffs on U.S.-origin goods. Some of the enumerated goods subject to this tariff include products and materials shipped to Sonoco’s plants in Canada.

While the exact scope of any tariffs or other trade policy changes that will ultimately be implemented is not known at this time, the Company does not currently expect these recently announced tariffs and proposed future tariffs to have a material direct effect on the Company’s profitability or cash flows over the remainder of 2025 because the Company’s manufacturing network is designed to serve local markets, reducing its exposure to cross-border disruptions and tariff-related risks, and while the Company is actively working with its customers to help manage the impacts of higher input costs driven by tariffs, its business model allows for pricing adjustments when necessary. In addition, the Company believes its transformed portfolio following the Eviosys acquisition and the sale of TFP is significantly more resilient, with over two-thirds of the Company’s sales for the three-month period ended March 30, 2025 coming from the Consumer Packaging segment, a segment that has historically demonstrated strong performance across economic cycles. In addition, while the Section 232 Tariffs impact input costs for the Company’s U.S.-based metal packaging and rigid paper container businesses (part of the Consumer Packaging segment), which source a portion of their steel and aluminum purchases from outside the United States, the Company intends, and has the contractual ability, to pass such increases in cost due to tariffs to its customers.

The ultimate resolution and consequences of these trade policy developments, and their effect on the Company in uncertain and the Company will continue to monitor the Administration’s trade policy changes closely in order to adapt its strategies and to maintain competitiveness in a challenging market environment. See “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q.

RESULTS OF OPERATIONS

The Company’s financial statements are prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). Sonoco’s management considers a variety of both GAAP and non-GAAP financial and operating measures in assessing the Company’s financial performance. The key GAAP measures used are net sales, operating profit, gross profit margin, net income attributable to Sonoco and diluted earnings per share. The key non-GAAP measures used are Adjusted operating profit, Adjusted net income attributable to Sonoco, Adjusted diluted earnings per share, Adjusted EBITDA and Adjusted EBITDA margin. For information about the Company’s use of non-GAAP measures and reconciliations of these measures to the most directly comparable GAAP measures see “Non-GAAP Financial Measures” below.

Management may also assess year-over-year changes in operating performance in terms of productivity savings or usage, which is driven by procurement savings or losses, production efficiencies or inefficiencies and the effect of fixed cost reduction initiatives. Management views productivity as a measure of operational excellence of the business and uses it to evaluate improvements in manufacturing efficiency, including automation, and other fixed and variable cost reduction initiatives. Management provides investors with this information to evaluate Sonoco’s operating results in a manner similar to how management evaluates operating performance. The Company calculates productivity savings as the

difference between applicable current period costs and prior year costs, excluding the impact of estimated inflation or deflation, and volume changes where appropriate.

On December 18, 2024, the Company announced that it had entered into an agreement to sell TFP to Toppan. This sale was completed on April 1, 2025, subsequent to the end of the first quarter. In accordance with applicable accounting guidance, the results of TFP are presented as discontinued operations in the Condensed Consolidated Statements of Income and, as such, have been excluded from both continuing operations and segment results for all periods presented in this Quarterly Report on Form 10-Q. Further, the Company reclassified the assets and liabilities of TFP as assets and liabilities of discontinued operations in the Condensed Consolidated Balance Sheets as of March 30, 2025 and December 31, 2024. The Condensed Consolidated Statements of Comprehensive Income, Changes in Total Equity, and Cash Flows are presented on a consolidated basis for both continuing operations and discontinued operations. All amounts, percentages and disclosures for all periods presented in this Quarterly Report on Form 10-Q reflect only the continuing operations of Sonoco unless otherwise noted.

SONOCO PRODUCTS COMPANY

First Quarter 2025 Compared with First Quarter 2024

The following discussion provides a review of results for the three-month period ended March 30, 2025 versus the three-month period ended March 31, 2024.

Overview

Consolidated net sales for the first quarter of 2025 were $1.7 billion, a $400.6 million or 30.6% increase from the first quarter of 2024. The increase was driven by $464.3 million in sales from the Eviosys acquisition in December 2024 and increased sales of $22.2 million as a result of increased selling prices across the Industrial Paper Packaging and Consumer Packaging segments. These increases were partially offset by a decrease of $51.5 million of sales related to divestitures and a net decline in volume/mix of $9.7 million.

GAAP operating profit for the first quarter of 2025 was $126.9 million, an increase of 74.8% from the $72.6 million reported in the first quarter of 2024. The increase in GAAP operating profit was primarily due to a $82.5 million increase in gross profit, and a decrease in restructuring related costs of $17.4 million from the prior year, partially offset by an increase of $41.5 million in selling, general and administrative expenses including acquisition and integration costs, and a net loss on dispositions of $4.2 million. Adjusted Operating Profit for the first quarter of 2025 was $212.7 million, an increase of 63.1% from the $130.4 million reported for the same period in 2024.

GAAP net income attributable to Sonoco for the first quarter of 2025 decreased to $54.4 million, or $0.55 per diluted share, compared to $65.2 million, or $0.66 per diluted share, for the first quarter of 2024. This decrease was primarily due to the increase in GAAP operating profit as described above, more than offset by an increase in net interest expense, a decrease in GAAP Net Income from discontinued operations, and an increased provision for income taxes as described below. Adjusted net income attributable to Sonoco and Adjusted diluted earnings per share for the first quarter of 2025 were $136.8 million ($1.38 per diluted share), compared with $111.5 million ($1.12 per diluted share) for the same period in 2024.

Costs and Expenses

Cost of goods sold increased by $318.1 million, or 30.7%, in the first quarter of 2025 compared with the first quarter of 2024. This increase was primarily driven by the Eviosys acquisition, partially offset by the decline in costs from the sale of the Protexic business in April 2024, improved productivity from procurement savings, production efficiencies, fixed cost reduction initiatives, and materials price reductions. Gross profit margins were flat at 20.7% in each of the first quarter of 2025 and the first quarter of 2024 .

Selling, general and administrative costs increased by $41.5 million, or 24.8%, and were 12.2% of sales in the first quarter of 2025, compared to 12.8% of sales in the first quarter of 2024. This increase was primarily due to the acquisition of Eviosys and the increase in acquisition, integration, and divestiture-related costs.

Restructuring/Asset impairment charges totaled $13.6 million in the first quarter of 2025, compared with $31.0 million during the same period last year. The higher cost in the prior year was primarily related to the closure of the Company’s paper mill in Sumner, Washington during the first quarter of 2024. Additional information regarding restructuring and asset impairment charges is provided in Note 6 to the Company’s Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Loss on divestiture of business and other assets of $4.2 million in the first quarter of 2025 reflects a $5.4 million loss from the sale of the Company’s tube and core operations in Venezuela, partially offset by a $1.2 million gain from the sale of a small construction tube operation in France, both part of the Industrial Paper Packaging segment. See Note 4 to the Company’s Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Other expense, net totaled $6.5 million in the first quarter of 2025. The amount represents charges from third-party financial institutions related to our centralized treasury program under which the Company sells certain trade accounts receivables in order to accelerate its cash collection cycle primarily within our Consumer Packaging segment.

Net interest expense for the first quarter of 2025 increased to $48.7 million, compared with $27.0 million during the first quarter of 2024. The increase was primarily due to higher year-over-year debt levels resulting from financing transactions related to the Eviosys acquisition.

The effective tax rates for continuing operations reflected in GAAP net income and Adjusted net income attributable to Sonoco in the first quarter of 2025 were 30.9% and 25.7%, respectively, compared with 18.6% and 26.2%, respectively, in the corresponding prior year quarter. The increase in the GAAP effective tax rate was primarily due to an adjustment to

SONOCO PRODUCTS COMPANY

record deferred tax liabilities on certain entities considered to be held for sale, as well as discrete non-GAAP charges for which no tax benefit will be realized.

Discontinued Operations

Net income from discontinued operations totaled $5.2 million for the first quarter of 2025, compared with $29.7 million for the first quarter of 2024. The decrease in net income is primarily due to the increase in interest expense related to debt required to be repaid upon closure of the sale of TFP.

Reportable Segments

The Company’s operating and reporting structure consists of two reportable segments, Consumer Packaging and Industrial Paper Packaging, with all remaining businesses reported as All Other. The following table summarizes net sales attributable to each of the Company’s segments and the All Other group of businesses for the first quarters of 2025 and 2024:


	Three Months Ended
(Dollars in thousands)	March 30, 2025		March 31, 2024		% Change
Net sales:
Consumer Packaging	$	1,066,593	$	581,670	83.4	%
Industrial Paper Packaging	557,709		593,060		(6.0)	%
Total reportable segments	1,624,302		1,174,730		38.3	%
All Other	84,926		133,906		(36.6)	%
Net sales	$	1,709,228	$	1,308,636	30.6	%

The following table summarizes operating profit attributable to each of the Company’s reportable segments, the All Other group of businesses, and Corporate-related activity during the first quarters of 2025 and 2024:


	Three Months Ended
(Dollars in thousands)	March 30, 2025		March 31, 2024		% Change
Operating profit:
Consumer Packaging	$	140,771	$	58,567	140.4	%
Industrial Paper Packaging	71,124		65,844		8.0	%
Segment operating profit	211,895		124,411		70.3	%
All Other	11,926		17,125		(30.4)	%
Corporate
Restructuring/Asset impairment charges	(13,581)		(31,010)
Amortization of acquisition intangibles	(41,961)		(17,894)
Loss on divestiture of business and other assets	(4,183)		—
Acquisition, integration and divestiture-related costs	(27,266)		(5,504)
Other corporate costs	(11,098)		(11,088)
Other operating income/(expense), net	1,128		(3,468)
Operating profit	$	126,860	$	72,572	74.8	%

SONOCO PRODUCTS COMPANY

Consumer Packaging

The products produced and sold within the Consumer Packaging segment are generally used to package a variety of consumer pro ducts and consist primarily of round and shaped rigid paper, steel and plastic containers; and metal and peelable membrane ends, closures, and components. These products primarily serve the consumer staples market, focused on food, beverage, household, personal, and pharmaceutical products.

Segment sales increased $484.9 million over the corresponding prior year quarter primarily due to increased sales from the 2024 Eviosys acquisition of $464.3 million and increased volumes/mix of $23.3 million. Year-over-year prices remained fairly flat.

Segment operating profit increased over the corresponding prior year quarter primarily due to operating profits from the Eviosys acquisition of $49.2 million and positive price/cost of $27.1 million. As a result, segment operating profit margin increased to 13.2% in the first quarter of 2025 from 10.1% in the same period last year.

Industrial Paper Packaging

The primary products produced and sold within the Industrial Paper Packaging segment include goods produced from recycled fiber, including paperboard tubes, cones, and cores; paper-based protective packaging; and uncoated recycled paperboard for folding cartons, can board and laminated structures. Products across this segment support end markets, primarily in paper, textile, and films.

Segment sales decreased $35.4 million from the corresponding prior year quarter primarily due to lower sales of $26.0 million from a decline in volume/mix, lower sales of $11.6 million due to the disposition of facilities in China during the fourth quarter of 2024, and $16.4 million unfavorable impact from foreign currency exchange rates. These headwinds were only partially offset by a $20.7 million increase from higher selling prices.

Segment operating profit increased over the corresponding prior year quarter primarily due to a $10.3 million increase from a positive price/cost environment combined with a $7.3 million increase attributable to strong productivity from procurement savings, production efficiencies, and fixed cost reduction initiative. These increases were partially offset by a decline of $5.8 million attributable to lower volumes and an unfavorable impact from foreign currency exchange rates. As a result, segment operating profit margin increased to 12.8% in the first quarter of 2025 from 11.1% in the same period last year.

All Other

The primary products produced within the All Other group of businesses consist of a variety of packaging materials, including plastic, paper, foam, and various other specialty materials serving a wide variety of end markets including consumer staples, consumer discretionary, and industrial.

Sales declined from the same period of the prior year primarily due to the sale of the Protexic business and the decline in volume/mix. Pricing was flat year over year.

All Other operating profit decreased in the first quarter of 2025 compared to the same period last year, primarily due to volume declines in our Industrial Plastics businesses and the sale of the Protexic business in April 2024. Price/cost was also a headwind from 2024, but this impact was largely offset by higher productivity from procurement savings, production efficiencies, and fixed cost reduction initiatives. As a result, operating profit margin increased to 14.0% in the first quarter of 2025 compared to 12.8% in the same period last year.

NON-GAAP FINANCIAL MEASURES

The Company uses certain financial performance measures, both internally and externally, that are not in conformity with GAAP (referred to as “non-GAAP financial measures”) to assess and communicate the financial performance of the Company. These “non-GAAP” financial measures, which are identified using the term “Adjusted” (for example, “Adjusted Operating Profit,” “Adjusted Net Income Attributable to Sonoco,” and “Adjusted Diluted EPS”) reflect adjustments to the Company’s GAAP operating results to exclude amounts, including the associated tax effects, relating to:

• restructuring/asset impairment charges 1 ;

• acquisition, integration and divestiture-related costs;

• gains or losses from the divestiture of businesses and other assets;

• losses from the early extinguishment of debt;

SONOCO PRODUCTS COMPANY

• non-operating pension costs;

• amortization expense on acquisition intangibles;

• changes in last-in, first-out ( “ LIFO ”) inventory reserves;

• certain income tax events and adjustments;

• derivative gains/losses;

• other non-operating income and losses; and

• certain other items, if any.

1 Restructuring and restructuring-related asset impairment charges are a recurring item as the Company’s restructuring programs usually require several years to fully implement, and the Company is continually seeking to take actions that could enhance its efficiency. Although recurring, these charges are subject to significant fluctuations from period to period due to the varying levels of restructuring activity, the inherent imprecision in the estimates used to recognize the impairment of assets and the wide variety of costs and taxes associated with severance and termination benefits in the countries in which the restructuring actions occur.

The Company’s management believes the exclusion of these amounts improves the period-to-period comparability and analysis of the underlying financial performance of the business. More information about the Company’s use of non-GAAP financial measures is provided in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, under Item 7 - “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the heading “Non-GAAP Financial Measures.”

In addition to the “Adjusted” results described above, the Company also uses Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA is defined as net income excluding the following: interest expense; interest income; provision for income taxes; depreciation, depletion and amortization expense; non-operating pension costs; net income/loss attributable to noncontrolling interests; restructuring/asset impairment charges; changes in LIFO inventory reserves; gains/losses from the divestiture of businesses and other assets; acquisition, integration and divestiture-related costs; other income; derivative gains/losses; and other non-GAAP adjustments, if any, that may arise from time to time. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales.

The Company’s non-GAAP financial measures are not calculated in accordance with, nor are they an alternative for, measures conforming to generally accepted accounting principles, and they may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles.

The Company presents these non-GAAP financial measures to provide investors with information to evaluate Sonoco’s operating results in a manner similar to how management evaluates business performance. The Company consistently applies its non-GAAP financial measures presented herein and uses them for internal planning and forecasting purposes, to evaluate its ongoing operations, and to evaluate the ultimate performance of management and each business unit against plans/forecasts. In addition, these same non-GAAP financial measures are used in determining incentive compensation for the entire management team and in providing earnings guidance to the investing community.

Material limitations associated with the use of such measures include that they do not reflect all period costs included in operating expenses and may not be comparable with similarly named financial measures of other companies. Furthermore, the calculations of these non-GAAP financial measures are based on subjective determinations of management regarding the nature and classification of events and circumstances that the investor may find material and view differently.

To compensate for any limitations in such non-GAAP financial measures, management believes that it is useful in evaluating the Company’s results to review both GAAP information, which includes all of the items impacting financial results, and the related non-GAAP financial measures that exclude certain elements, as described above. Further, Sonoco management does not, nor does it suggest that investors should, consider any non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Whenever reviewing a non-GAAP financial measure, investors are encouraged to review the related reconciliation to understand how it differs from the most directly comparable GAAP measure.

SONOCO PRODUCTS COMPANY

Quarterly Reconciliations of GAAP to Non-GAAP Financial Measures

The following tables reconcile the Company’s non-GAAP financial measures to their most directly comparable GAAP financial measures in the Company’s Condensed Consolidated Statements of Income for the three-month periods ended March 30, 2025 and March 31, 2024.

Adjusted Operating Profit, Adjusted Income Before Income Taxes, Adjusted Provision for Income Taxes, Adjusted Net Income Attributable to Sonoco, and Adjusted Diluted Earnings Per Share (“EPS”)


	For the three-month period ended March 30, 2025
Dollars in thousands, except per share data	Operating Profit		Income Before Income Taxes		Provision for Income Taxes		Net Income Attributable to Sonoco		Diluted EPS
As Reported (GAAP) 1	$	126,860	$	68,543	$	21,147	$	54,429	$	0.55
Acquisition, integration and divestiture-related costs 2	27,266		27,266		6,637		30,295		0.30
Changes in LIFO inventory reserves	562		562		142		420		—
Amortization of acquisition intangibles	41,961		41,961		9,604		32,144		0.32
Restructuring/Asset impairment charges	13,581		13,581		3,200		10,715		0.11
Loss on divestiture of business and other assets	4,183		4,183		372		3,811		0.04

Non-operating pension costs	—		3,121		798		2,323		0.02
Net gains from derivatives	(2,949)		(2,949)		(744)		(2,205)		(0.02)
Other adjustments 3	1,259		1,259		(603)		4,908		0.06
Total adjustments	85,863		88,984		19,406		82,411		0.83
Adjusted	$	212,723	$	157,527	$	40,553	$	136,840	$	1.38
Due to rounding, individual items may not sum appropriately.

1 Operating profit, income before income taxes, and provision for income taxes exclude results related to discontinued operations of $37,791, $12,979 and $7,807, respectively.

2 Acquisition, integration and divestiture-related costs relate mostly to the Company’s December 2024 acquisition of Eviosys and the divestiture of the TFP business, which was completed on April 1, 2025.

3 Other adjustments include discrete tax items primarily related to a $3,500 tax expense due to the reduction of the deferred tax asset on the outside basis of certain held-for-sale entities.


	For the three-month period ended March 31, 2024
Dollars in thousands, except per share data	Operating Profit		Income Before Income Taxes		Provision for Income Taxes		Net Income Attributable to Sonoco		Diluted EPS
As Reported (GAAP) 1	$	72,572	$	42,246	$	7,871	$	65,177	$	0.66
Acquisition, integration and divestiture-related costs	5,504		5,504		1,408		4,209		0.04
Changes in LIFO inventory reserves	431		431		108		323		—
Amortization of acquisition intangibles	17,894		17,894		4,368		17,366		0.18
Restructuring/Asset impairment charges	31,010		31,010		6,980		24,584		0.25


Non-operating pension costs	—		3,295		823		2,472		0.02
Net gains from derivatives	(286)		(286)		(72)		(214)		—
Other adjustments	3,323		3,323		5,653		(2,425)		(0.03)
Total adjustments	57,876		61,171		19,268		46,315		0.46
Adjusted	$	130,448	$	103,417	$	27,139	$	111,492	$	1.12
Due to rounding, individual items may not sum appropriately.

1 Operating profit, income before income taxes, and provision for income taxes exclude results related to discontinued operations of $39,881, $39,250 and $9,489 , respectively.

SONOCO PRODUCTS COMPANY

Adjusted EBITDA 1


	Three Months Ended
Dollars in thousands	March 30, 2025		March 31, 2024

Net income attributable to Sonoco	$	54,429	$	65,177
Adjustments
Interest expense	80,938		31,220
Interest income	(7,629)		(3,558)
Provision for income taxes	28,954		17,360
Depreciation, depletion and amortization	121,492		90,559
Non-operating pension costs	3,121		3,295
Net income attributable to noncontrolling interests	60		96
Restructuring/Asset impairment charges	14,007		31,618
Changes in LIFO inventory reserves	562		431
Loss on divestiture of business and other assets	4,183		—
Acquisition, integration and divestiture-related costs	39,942		5,661

Net gains from derivatives	(2,949)		(286)
Other non-GAAP adjustments	646		3,180
Adjusted EBITDA	$	337,756	$	244,753

1 Adjusted EBITDA is calculated on a total Company basis, including both continuing operations and discontinued operations.

The Company does not calculate net income by segment; therefore, Adjusted EBITDA by segment is reconciled to the closest GAAP measure of segment profitability, segment operating profit. Segment operating profit is the measure of segment profit or loss reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance in accordance with Accounting Standards Codification 280, “Segment Reporting,” as prescribed by the Financial Accounting Standards Board.

Segment results, which are reviewed by the Company’s management to evaluate segment performance, do not include the following: restructuring/asset impairment charges; amortization of acquisition intangibles; acquisition, integration and divestiture-related costs; changes in LIFO inventory reserves; gains/losses from the sale of businesses or other assets; gains/losses from derivatives; or certain other items, if any, the exclusion of which the Company believes improves the comparability and analysis of the ongoing operating performance of the business. Accordingly, the term “segment operating profit” is defined as the segment’s portion of “operating profit” excluding those items. All other general corporate expenses have been allocated as operating costs to each of the Company’s reportable segments and All Other, except for costs related to discontinued operations. Total operating profit is composed of the sum of segment and All Other operating profit plus certain items that have been allocated to Corporate, including amortization of acquisition intangibles; restructuring/asset impairment charges; changes in LIFO inventory reserves; acquisition, integration and divestiture-related costs; gains/losses from the sale of businesses or other assets; gains/losses on derivatives; and certain other items that were excluded from segment and All Other operating profit.

SONOCO PRODUCTS COMPANY


Segment and All Other Adjusted EBITDA and Adjusted EBITDA Margin Reconciliation
For the Three Months Ended March 30, 2025
Excludes results of discontinued operations
Dollars in thousands	Consumer Packaging segment			Industrial Paper Packaging segment			All Other			Corporate		Total
Segment and Total Operating Profit	$	140,771		$	71,124		$	11,926		$	(96,961)	$	126,860
Adjustments:
Depreciation, depletion and amortization 1	48,955			28,333			2,554			41,961		121,803
Other expense, net 2	—			—			—			(6,517)		(6,517)
Equity in (loss)/earnings of affiliates, net of tax	(51)			1,972			—			—		1,921
Restructuring/Asset impairment charges 3	—			—			—			13,581		13,581
Changes in LIFO inventory reserves 4	—			—			—			562		562
Acquisition, integration and divestiture-related costs 5	—			—			—			27,266		27,266
Loss on divestiture of business and other assets 6	—			—			—			4,183		4,183
Net gains from derivatives 7	—			—			—			(2,949)		(2,949)
Other non-GAAP adjustments	—			—			—			1,259		1,259
Segment Adjusted EBITDA	$	189,675		$	101,429		$	14,480		$	(17,615)	$	287,969

Net Sales	$	1,066,593		$	557,709		$	84,926
Segment Operating Profit Margin	13.2		%	12.8		%	14.0		%
Segment Adjusted EBITDA Margin	17.8		%	18.2		%	17.1		%

1 Included in Corporate is the amortization of acquisition intangibles associated with the Consumer Packaging segment of $36,502, the Industrial Paper Packaging segment of $5,265, and the All Other group of businesses of $194.

2 These expenses relate to charges from third-party financial institutions related to our centralized treasury program under which the Company sells certain trade accounts receivables in order to accelerate its cash collection cycle, primarily within the Consumer Packaging segment.

3 Included in Corporate are restructuring/asset impairment charges associated with the Consumer Packaging segment of $1,220 and the Industrial Paper Packaging segment of $12,401, and a gain in the All Other group of businesses of $40.

4 Included in Corporate are changes in LIFO inventory reserves associated with the Consumer Packaging segment of $562.

5 Included in Corporate are acquisition, integration and divestiture-related costs associated with the Consumer Packaging segment of $20,072 and the Industrial Paper Packaging segment of $218.

6 Included in Corporate are losses on the divestiture of businesses associated with the Industrial Paper Packaging segment of $4,183 related to the sale of a production facility in France and the entirety of our business in Venezuela.

7 Included in Corporate are net gains from derivatives associated with the Consumer Packaging segment of $(284), the Industrial Paper Packaging segment of $(2,552), and the All Other group of businesses of $(113).

SONOCO PRODUCTS COMPANY


Segment and All Other Adjusted EBITDA and Adjusted EBITDA Margin Reconciliation
For the Three Months Ended March 31, 2024
Excludes results of discontinued operations
Dollars in thousands	Consumer Packaging segment			Industrial Paper Packaging segment			All Other			Corporate		Total
Segment and Total Operating Profit	$	58,567		$	65,844		$	17,125		$	(68,964)	$	72,572
Adjustments:
Depreciation, depletion and amortization 1	24,897			28,503			3,652			17,894		74,946
Equity in earnings of affiliates, net of tax	13			1,124			—			—		1,137
Restructuring/Asset impairment charges 2	—			—			—			31,010		31,010
Changes in LIFO inventory reserves 3	—			—			—			431		431
Acquisition, integration and divestiture-related costs 4	—			—			—			5,504		5,504

Net gains from derivatives 5	—			—			—			(286)		(286)
Other non-GAAP adjustments	—			—			—			3,323		3,323
Segment Adjusted EBITDA	$	83,477		$	95,471		$	20,777		$	(11,088)	$	188,637

Net Sales	$	581,670		$	593,060		$	133,906
Segment Operating Profit Margin	10.1		%	11.1		%	12.8		%
Segment Adjusted EBITDA Margin	14.4		%	16.1		%	15.5		%

1 Included in Corporate is the amortization of acquisition intangibles associated with the Consumer Packaging segment of $11,057, the Industrial Paper Packaging segment of $6,631, and the All Other group of businesses of $206.

2 Included in Corporate are restructuring/asset impairment charges associated with the Consumer Packaging segment of $4,317, the Industrial Paper Packaging segment of $22,603, and the All Other group of businesses of $1,148.

3 Included in Corporate are changes in LIFO inventory reserves associated with the Consumer Packaging segment of $92 and the Industrial Paper Packaging segment of $339.

4 Included in Corporate are acquisition, integration and divestiture-related costs associated with the Consumer Packaging segment of $(280) and the Industrial Paper Packaging segment of $655.

5 Included in Corporate are net gains from derivatives associated with the Consumer Packaging segment of $(43), the Industrial Paper Packaging segment of $(190), and the All Other group of businesses of $(53).

SONOCO PRODUCTS COMPANY

Financial Position, Liquidity and Capital Resources

Operating activities used cash of $208.1 million in the first three months of 2025 , while they provided cash of $166.2 million in the same period of 2024, a year-over-year decrease of $374.3 million. GAAP net income decreased by $10.8 million year over year as described in the “Results of Operations” section above. Net working capital used $309.4 million of cash in the first three months of 2025, while providing $0.8 million in the same period of 2024, for a year-over-year decrease in operating cash flow of $310.1 million. Accounts receivable used $21.0 million more cash during the first three months of 2025 than in the same period of 2024 as a result of the impact of the changing mix in customer payment terms combined with higher revenues year over year. Inventory was a use of cash of $110.2 million in the first three months of 2025, while it was a source of cash of $18.4 million in the same period of 2024 due to higher overall inventory levels, mainly in tinplate steel, the impacts of inflation, and seasonality. Accounts payable used cash of $134.9 million in the first three months as compared to a provision of cash of $25.7 million in the same period of 2024 due to timing of purchases and scheduled payments. The Company has continued to actively manage inventories and review payment terms with customers and suppliers to address risk and balance economic benefit. Changes in accrued expenses and other assets and liabilities used cash totaling $100.2 million in the first three months of 2025 and $7.1 million in the same period of 2024, for a year-over-year increase in use of cash of $93.2 million. The primary drivers contributing to the change include the higher year-over-year payments related to management incentive compensation of $24.3 million, interest of $22.1 million, and the Company’s restructuring initiatives of $16.8 million.

Investing activities used $88.6 million of cash in the first three months of 2025, compared with $81.7 million in the same period of 2024, a higher year-over-year use of cash of $6.9 million, primarily attributable to higher capital expenditures. Capital expenditures during the first three months of 2025 totaled $92.7 million, a $6.2 million increase year over year. Proceeds from divestitures provided $3.5 million in the first three months of 2025, including $2.0 million of proceeds related to the July 1, 2023 sale of the Company’s U.S. BulkSak business released from escrow in February 2025 and $1.5 million of proceeds from the sale of a small construction tube operation in France.

Financing activities provided $29.6 million of cash in the three-month period ended March 30, 2025, compared with using $62.7 million of cash in the corresponding prior-year period. The primary driver of the $92.3 million year-over-year increase was the receipt of proceeds from the issuance of commercial paper of $528.0 million, partially offset by $448.8 million in net debt repayments during the first three months of 2025, including the repayment upon maturity of the $400 million aggregate principal amount of the Company’s 1.800% note s due February 2025. N et debt repayments in the first quarter of 2024 were $1.8 million. Cash used to pay dividends increased by $1.1 million year over year, reflecting the increase in the quarterly dividend payment from $0.51 per share to $0.52 per share, which increase was approved by the Company’s Board of Directors in April 2024. Cash used to repurchase the Company’s common stock to satisfy employee tax withholding obligations in association with the exercise of certain share-based compensation awards was $10.6 million in the three-month period ended March 30, 2025, compared to $9.1 million in the corresponding prior-year period.

During the three-month period ended March 30, 2025, the Company reported a net increase in cash and cash equivalents of $15.7 million due to currency translation adjustments resulting from a weaker U.S. dollar relative to certain foreign currencies in which cash and cash equivalents were held.

The Company’s cash balances are held in numerous locations throughout the world. At March 30, 2025 and December 31, 2024, approximately $161.4 million and $190.1 million, respectively, of the Company’s reported cash and cash equivalents balances of $181.8 million and $431.0 million, respectively, were held outside of the United States by its foreign subsidiaries. Cash held outside of the United States is available to meet local liquidity needs or for capital expenditures, acquisitions, and other offshore growth opportunities.

The Company uses a notional pooling arrangement with an international bank to help manage global liquidity requirements. Under this pooling arrangement, the Company and its participating subsidiaries may maintain either a cash deposit or borrowing position through local currency accounts with the bank, so long as the aggregate position of the global pool is a notionally calculated net cash deposit. Because it maintains a security interest in the cash deposits and has the right to offset the cash deposits against the borrowings, the bank provides the Company and its participating subsidiaries favorable interest terms on both the cash deposit and borrowing positions.

SONOCO PRODUCTS COMPANY

The Company maintains a revolving credit facility with total commitments of $1.25 billion and a maturity date of May 3, 2029. The Company’s $1.25 billion commercial paper program is supported by the revolving credit facility. At March 30, 2025 , the Company had $528.0 million in commercial paper balances outstanding; accordingly, the committed capacity available for drawdown under its revolving credit facility at March 30, 2025 was $722.0 million. The Company has the contractual right to draw funds directly on the underlying revolving credit facility, which could possibly occur if there were a disruption in the commercial paper market.

On February 3, 2025, the Company repaid the $400 million aggregate principal amount of its 1.800% notes due February 2025 upon maturity using proceeds from the issuance of commercial paper.

At March 30, 2025, the Company had scheduled debt maturities of approximately $2.15 billion over the next twelve months. On April 1, 2025, subsequent to the end of the three-month period ended March 30, 2025 , the Company completed the sale of TFP and used a portion of the cash proceeds from the sale to repay the outstanding $1.50 billion principal amount of borrowings under its 364 -day term loan facility. The Company believes that cash and cash equivalents on hand, expected net cash flows generated from operating and investing activities, available capacity under the Company’s increased borrowing arrangements, and proceeds from potential divestitures, will provide sufficient liquidity to cover the remaining debt maturities and other cash flow needs of the Company over the next twelve months and beyond.

Certain of the Company’s debt agreements impose restrictions with respect to the maintenance of financial ratios and the disposition of assets. The most restrictive covenants currently require the Company to maintain a minimum level of interest coverage and a minimum level of net worth, as defined in the agreements. As of March 30, 2025 , the Company’s interest coverage and net worth were substantially above the minimum levels required under these covenants.

The Company continually explores strategic acquisition opportunities that may result in the use of cash. Given the nature of the acquisition process, the timing and amounts of such expenditures are not always predictable. The Company expects that any additional acquisitions requiring funding in excess of cash on hand would be financed using existing credit facilities or additional borrowings.

The Company anticipates making additional contributions to its other pension and postretirement plans of approximately $19 million durin g the remainder of 2025, resulting in expected total contributions to these plans of approximately $23 million in 2025. Future funding requirements beyond the current year will vary depending largely on investment performance, future actuarial assumptions, and legislative actions.

Fair Value Measurements, Foreign Exchange Exposure and Risk Management

Certain assets and liabilities are reported in the Company’s financial statements at fair value, the fluctuation of which can impact the Company’s financial position and results of operations. Items reported by the Company at fair value on a recurring basis include derivative contracts and pension-related assets. The valuation of a majority of these items is based either on quoted prices in active and accessible markets or on other observable inputs.

As a result of operating globally, the Company is exposed to changes in foreign exchange rates. The exposure is well diversified, as the Company’s facilities are located throughout the world, and the Company generally sells in the same countries where it produces with both revenue and costs transacted in the local currency. The Company monitors these exposures and uses foreign currency forward contracts and other risk management instruments to manage exposure to changes in foreign currency cash flows and the translation of monetary assets and liabilities on the Company’s condensed consolidated financial statements by hedging a portion of forecasted transactions that are denominated in foreign currencies, foreign currency assets and liabilities, or its net investment in foreign subsidiaries. The Company’s foreign operations are exposed to political, geopolitical, and cultural risks, but these risks are mitigated by diversification and the relative stability of the countries in which the Company has significant operations.

The economy in Venezuela has been considered highly inflationary under U.S. GAAP since 2010. Accordingly, the Company considered the U.S. dollar to be the functional currency of its Venezuelan operations and used the official exchange rate when remeasuring the financial results of those operations since January 1, 2010. Economic conditions in Venezuela worsened considerably over the past several years with no indications that conditions were likely to improve in the foreseeable future. As a result, the Company sold its operations in Venezuela during the first quarter of 2025, recognizing a loss in the amount of $5.4 million, including $3.8 million of cumulative translation losses that were reclassified from accumulated other comprehensive income.

SONOCO PRODUCTS COMPANY

Turkey has been deemed to be a highly inflationary economy under U.S. GAAP since the first quarter of 2022. Accordingly, the Company considers the U.S. dollar to be the functional currency of its operations in Turkey and has remeasured monetary assets and liabilities denominated in Turkish lira to U.S. dollars with changes recorded through earnings. The cumulative impact of applying highly inflationary accounting to Turk ey has been a pretax charge to earnings of $8.5 million ($6.5 million after tax), including $0.6 million ($0.4 million after tax) during th e three-month period ended March 30, 2025. Th e magnitude of future earnings impacts, however, is uncertain as such impacts are dependent upon unpredictable movements in the Turkish lira relative to the U.S. dollar. In addition to remeasurement-related charges, significant deterioration in the Turkish economy could result in the recognition of future impairment charges. However, the Company believes its exposure is limited to its net investment in Turkey, which was approximat ely $51.5 million as of March 30, 2025.

The Company is a purchaser of various raw material inputs such as recovered paper, energy, steel, aluminum, and plastic resin. The Company generally does not engage in significant hedging activities for these purchases other than for energy and, from time to time, aluminum, because there is usually a high correlation between the primary input costs and the ultimate selling price of its products. Inputs are generally purchased at market or at fixed prices that are established with individual suppliers as part of the purchase process for quantities expected to be consumed in the ordinary course of business. On occasion, where the correlation between selling price and input price is less direct, the Company may enter into derivative contracts such as futures or swaps to manage the effect of price fluctuations. In addition, the Company may occasionally use traditional, unleveraged interest-rate swaps to manage its mix of fixed and variable rate debt and control its exposure to interest rate movements within select ranges.

At March 30, 2025, t he Company had derivative contracts outstanding to hedge the prices on a portion of anticipated aluminum purchases. These contracts, some of which qualify as cash flow hedges, include aluminum swaps totaling 4,179 metric tons. The total fair value of the Company’s commodity cash flow hedges netted to gain positions of $0.1 million and $0.7 million at March 30, 2025 and December 31, 2024, respectively. The amount of the gain included in accumulated other comprehensive income at March 30, 2025 expected to be reclassified to the income statement during the next twelve months is $0.1 million.

The Company routinely enters into derivative currency contracts to mitigate the risk of unfavorable fluctuations in the exchange rate on certain anticipated foreign currency cash flows. T he total market value of these instruments resulted in a net gain position of $1.1 million and a net loss position of $1.8 million at March 30, 2025 and December 31, 2024, respectively . In addition, at March 30, 2025, the Company had various currency contracts outstanding to hedge the currency exposure of intercompany debt and foreign currency denominated receivables and payables. Although placed as economic hedges, the Company does not apply hedge accounting to these instruments. As such, changes in fair value are recorded directly to income and expense in the periods that they occur. The fair value of the Company’s non-designated deriva tives position was a gain of $3.0 million and a loss of $2.7 million at March 30, 2025 and December 31, 2024, respectively.

In 2023, the Company became a party to cross-currency swap agreements with a total notional amount of $500 million to effectively convert a portion of the Company’s fixed-rate U.S. dollar denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt. The swap agreements, which had a maturity of December 18, 2026, provided for the Company to receive semi-annual interest payments in U.S. dollars at a fixed rate and to make semi-annual interest payments in euros at a fixed rate. The risk management objective of entering into the swap agreements was to manage foreign currency risk relating to net investments in certain European subsidiaries denominated in euros. The agreements were designated as net investment hedges for accounting purposes. On April 15, 2024, as a result of the strengthening of the U.S. dollar against the euro, as well as a reduction in the differential between U.S. and European interest rates, the Company terminated its swap agreements and received a net cash settlement of $9.1 million. The foreign currency translation gain of approximately $3.1 million, net of tax, is included as a component of “Accumulated other comprehensive loss.”

SONOCO PRODUCTS COMPANY

Following the unwind of the swaps, the Company entered into new cross-currency swap agreements with a total notional amount of $500 million in April 2024 to effectively convert a portion of the Company’s fixed-rate U.S. dollar-denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt. The new swap agreements, which have a maturity of May 1, 2027, share the same risk management objective as the terminated cross-currency swap agreements and are also designated as net investment hedges for accounting purposes.

In December 2024, the Company entered into additional cross-currency swap agreements with a total notional amount of $1.5 billion, including $500 million maturing on September 1, 2026, $500 million maturing on September 1, 2029, and $500 million maturing on May 1, 2030. The swaps effectively convert a portion of the Company’s fixed-rate U.S. dollar-denominated debt, including the semi-annual interest payments, to fixed-rate euro-denominated debt at the prevailing market rate at execution. The new swap agreements share the same risk management objective as the Company’s previously existing cross-currency swap agreements and are also designated as net investment hedges for accounting purposes.

The fair value of the Company’s net investment hedges was a loss position of $49.2 million and a gain position of $11.9 million at March 30, 2025 and December 31, 2024, respectively. Foreign currency translation loss of $36.7 million (net of income taxes of $12.6 million) and gain of $8.9 million (net of income taxes of $3.0 million) were reported as components of “Accumulated other comprehensive loss” within “Foreign currency items” at March 30, 2025 and December 31, 2024, respectively.

The Company has an investment in preferred stock of a nonaffiliated private company that is accounted for under the measurement alternative of cost less impairment, adjusted for any qualifying observable price changes. Observable price changes would consist of Level 2 inputs based on privately negotiated transactions with the nonaffiliated company. The preferred stock balance of $21.2 million is included in “Other assets” in the Company’s Condensed Consolidated Balance Sheet as of March 30, 2025 .

During the first three months of 2025, the U.S. dollar weakened against the euro, the British pound, the Moroccan dirham, the Polish zloty, the Brazilian real, the Danish krone, the Mexican peso, and the Colombian peso, all of which are functional currencies in which a large amount of the Company’s foreign investments are held. During this same period, the U.S. dollar strengthened against the Indonesia rupiah and the Chinese yuan. The net impact of these changes, and the changes in the net investment hedge discussed above, resulted in a net translation gain of $172.1 million being recor ded in “Accumulated other comprehensive loss” during the three-month period ended March 30, 2025.

Restructuring and Impairment

Information regarding restructuring charges and restructuring-related asset impairment charges is provided in Note 6 to the Company’s Condensed Consolidated Financial Statements, included in Part I, Item 1 of this Form 10-Q.

New Accounting Pronouncements

Information regarding new accounting pronouncements is provided in Note 3 to the Company’s Condensed Consolidated Financial Statements, included in Part I, Item 1 of this Form 10-Q.


Item 3.			Quantitative and Qualitative Disclosures About Market Risk.

Information about the Company’s exposure to market risk is discussed under Part I, Item 2 in this Quarterly Report on Form 10-Q and was disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the Securities and Exchange Commission on February 28, 2025. There have been no other material quantitative or qualitative changes in market risk exposure since the date of that filing.

SONOCO PRODUCTS COMPANY


Item 4.			Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Under the supervision, and with the participation, of our management, including our Company’s Chief Executive Officer (“CEO”) and Interim Chief Financial Officer (“CFO”), we conducted an evaluation pursuant to Rule 13a-15(b) under the Exchange Act of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on this evaluation, our CEO and CFO concluded that such controls and procedures, as of March 30, 2025, the end of the period covered by this Quarterly Report on Form 10-Q, were effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. For this purpose, disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information that is required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

On December 4, 2024, we acquired Eviosys and, as disclosed in Item 9A of our Annual Report on Form 10-K for the year ended December 31, 2024, management excluded Eviosys from our assessment of internal control over financial reporting as of December 31, 2024 as permitted by SEC rules and regulations. We are in the process of integrating Eviosys into Sonoco’s internal control structure during fiscal 2025. Except as it relates to the integration activities of the Eviosys business, there were no changes in the Company’s internal control over financial reporting that occurred during the three months ended March 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

SONOCO PRODUCTS COMPANY

PART II. OTHER INFORMATION


Item 1.			Legal Proceedings.

Information with respect to legal proceedings and other exposures appears in Part I - Item 3 - “Legal Proceedings” and Part II - Item 8 - “Financial Statements and Supplementary Data” (Note 18 - “Commitments and contingencies”) in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and in Part I - Item 1 - “Financial Statements” (Note 18 - “Commitments and Contingencies”) of this Quarterly Report on Form 10-Q.

Environmental Matters

The Company has been named as a potentially responsible party (“PRP”) at several environmentally contaminated sites not owned by the Company. All of the sites are also the responsibility of other parties. The Company’s liability, if any, is shared with such other parties, but the Company’s share has not been finally determined in most cases. In some cases, the Company has cost-sharing arrangements with other PRPs with respect to a particular site. Such agreements relate to the sharing of legal defense costs or cleanup costs, or both. The Company has assumed, for purposes of estimating amounts to be accrued, that the other parties to such cost-sharing agreements will perform as agreed. It appears that final resolution of some of the sites is years away, and actual costs to be incurred for these environmental matters in future periods is likely to vary from current estimates because of the inherent uncertainties in evaluating environmental exposures. Accordingly, the ultimate cost to the Company with respect to such sites, beyond what has been accrued at March 30, 2025, cannot be determined. As of March 30, 2025 and December 31, 2024, the Company had accrued $6.9 million and $7.0 million, respectively, related to environmental contingencies. Of the total amounts accrued, $5.1 million as of both March 30, 2025 and December 31, 2024, is attributable to environmental contingencies at a site in Spartanburg, South Carolina that is part of the Company’s Thermoformed and Flexibles Packaging business and part of the sale of TFP to Toppan completed on April 1, 2025, subsequent to the end of the first quarter.

The Company periodically reevaluates the assumptions used in determining the appropriate reserves for environmental matters as additional information becomes available and, when warranted, makes appropriate adjustments.

Other Legal Matters

Information regarding other legal proceedings is provided in Note 18 to the Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.


Item 1A.			Risk Factors

Risks Related to the Domestic and Global Economies and to Doing Business Globally

Changes in United States trade policies and global regulations, as well as the overall uncertainty surrounding international trade relations, could materially and adversely affect our consolidated financial condition and results of operations.

We continue to face uncertainty with respect to trade relations between the United States and many of its trading partners. For example, beginning in the first quarter of 2025, the U.S. government has announced, delayed, re-imposed and revised a series of broad-based, as well as country-, bloc- and sector-specific, tariffs on imports, as well as other trade policy changes. Some countries have announced retaliatory actions or plans for retaliatory actions, which may continue to give rise to further escalations of trade measures by the United States and impacted countries. The exact scope of any tariffs or other trade policy changes that will ultimately be implemented is not known at this time, and the impacts on our business and results of operations are uncertain. Such tariffs have had, and may in the future have, an adverse effect on our costs of products sold and margins in our North America operations. Additional measures targeting U.S. trade with China and other countries may have a further adverse effect on our consolidated financial condition and results of operations.

In addition, in July 2020, the USMCA, which replaced the North American Free Trade Agreement, became effective. In response to this agreement, other countries may change their own trade policies, including the imposition of additional tariffs and quotas, which could also adversely affect our business outside the United States. If further tariffs are imposed on a broader range of imports, further retaliatory trade measures are taken by countries in response to tariffs, or efforts are made to withdraw from or substantially modify such agreements, then we may be required to raise our prices or incur additional expenses, which may result in the loss of customers and harm our sales, earnings, business, financial condition, and results of operations. Furthermore, while the duty preferential treatment for goods that qualify for the USMCA was temporarily exempted from the Administration’s 25% tariff on

SONOCO PRODUCTS COMPANY

Mexican and Canadian goods, Canada has imposed retaliatory tariffs on goods coming from the United States that do not exempt USMCA-qualified goods. Some of the enumerated goods subject to this tariff include products and materials shipped to Sonoco’s plants in Canada . These or any future retaliatory measures, or the removal of the exemption by the Administration, could impact our operations by increasing the cost of imported raw materials and finished goods from Canada and Mexico.

Tariff increases have in the past had, and we expect that such measures and any additional measures will have, an adverse effect on our costs of products sold and margins in our North America operations, including by increasing the cost of imported raw materials, which costs we may be unable to pass on to our customers without affecting demand, and potentially disrupting supply chains, causing delays and logistical challenges. In order to mitigate the impact of these trade-related increases on our costs of products sold, we have increased, and may in the future, increase, prices in certain markets and, over the longer term, make changes in our supply chain and potentially, our U.S. manufacturing strategy. For example, a portion of the steel and aluminum we purchase for our metal packaging and industrial paper packaging businesses is sourced from outside the United States, and although we generally have the contractual ability to pass on cost increases due to tariffs to our customers, any price increases may cause our customers to find alternative suppliers and result in reduced demand for our products. If we are unable to successfully pass on these costs through price increases, adjust our supply chain without incurring significant costs, or locate alternative suppliers for raw materials or finished goods at acceptable costs or in a timely manner, our net sales, costs, and margins could be adversely affected.

Higher tariffs also may increase the cost of purchasing and maintaining manufacturing equipment used in our operations. We believe the impact of higher tariffs on purchases of manufacturing equipment, while modest to our results of operations, will result in higher cash costs of such items and may therefore reduce both the number of capital projects we are able to undertake and the return on investment on such capital projects. Further, the Company may incur higher costs due to tariffs on maintenance and repair spending. If we are unable to effectively manage the impact of higher tariffs on our capital expenditures and repairs and maintenance spending through price pass-through mechanisms or locating lower-cost alternative suppliers, our results of operations, including our cash flows, could be materially and adversely affected.

Further, the uncertainty surrounding global trade policy and its broader economic impacts requires significant management attention and makes it difficult to make long-term strategic decisions regarding the best way to respond to these pressures. Such uncertainty has in the past increased, and may in the future increase the volatility of currency exchange rates. In addition, even if we are able to mitigate the direct impacts to our operations from changes in U.S. and foreign trade policy, our sales volumes may be adversely affected by any reduction in sales of or demand for end products incorporating our packaging products or changes in consumer behavior, whether resulting from increased costs of such products attributable to increased tariffs or other trade barriers or the broader economic impact of such measures, such as increased inflation, decreased consumer spending or other adverse macroeconomic trends.

Our inability to effectively manage the adverse impacts of changing U.S. and foreign trade policies could materially and adversely impact our consolidated financial condition and results of operations.


Item 5.			Other Information.

Insider Trading Arrangements

During the three months ended March 30, 2025 , none of the Company’s officers or directors adopted or terminated any contract, instruction or written plan for the purchase or sale of the Company’s securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement.

SONOCO PRODUCTS COMPANY


Item 6.			Exhibits.


			Exhibit Index
2.1*			Share and Asset Purchase Agreement, dated as of December 18, 2024, by and between Sonoco Products Company and TOPPAN Holdings Inc. (incorporated by reference to Exhibit 2.1 to the Registrant’s Form 8-K filed December 18, 2024)
10.1			Separation Agreement dated January 3, 2025, by and between Robert R. Dillard and Sonoco Products Company
3.1			Restated Articles of Incorporation, as amended April 21, 2022 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K filed April 22, 2022)
3.2			By-Laws of Sonoco Products Company, as amended October 17, 2023 (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, filed October 19, 2023)
31			Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and 17 C.F.R. 240.13a-14(a)
32			Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and 17 C.F.R. 240.13a-14(b)
101.INS			XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH			XBRL Taxonomy Extension Schema Document
101.CAL			XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF			XBRL Taxonomy Extension Definition Linkbase Document
101.LAB			XBRL Taxonomy Extension Label Linkbase Document
101.PRE			XBRL Taxonomy Extension Presentation Linkbase Document
104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Certain schedules and attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to provide, on a supplemental basis, a copy of any omitted schedules and attachments to the Securities and Exchange Commission or its staff upon request.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

SONOCO PRODUCTS COMPANY

(Registrant)

Date:

May 2, 2025

By:

/s/ Jerry A. Cheatham

Jerry A. Cheatham

Interim Chief Financial Officer

(principal financial officer)

/s/ Aditya Gandhi

Aditya Gandhi

Chief Accounting Officer

(principal accounting officer)

TABLE OF CONTENTS

Part I. Financial Information Item 1. Financial Statements Note 1: Basis Of Interim Presentation Note 2: Discontinued Operations Note 3: New Accounting Pronouncements Note 4: Acquisitions and Divestitures Note 5: Shareholders Equity Note 6: Restructuring and Asset Impairments Note 7: Accumulated Other Comprehensive Loss Note 8: Goodwill and Other Intangible Assets Note 9: Supply Chain Financing Note 10: Debt Note 11: Financial Instruments and Derivatives Note 12: Fair Value Measurements Note 6 For A Note 13: Employee Benefit Plans Note 14: Income Taxes Note 15: Leases Note 16: Revenue Recognition Note 17: Segment Reporting Note 18: Commitments and Contingencies Item 2. Management S Discussion and Analysis Of Financial Condition and Results Of Operations Item 3. Quantitative and Qualitative Disclosures About Market Risk Item 4. Controls and Procedures Part II. Other Information Item 1. Legal Proceedings Item 1A. Risk Factors Item 5. Other Information Item 6. Exhibits

Exhibits

2.1* Share and Asset Purchase Agreement, dated as of December 18, 2024, by and between Sonoco Products Company and TOPPAN Holdings Inc. (incorporated by reference to Exhibit 2.1 to the Registrants Form 8-K filed December 18, 2024) 10.1 Separation Agreement dated January 3, 2025, by and between Robert R. Dillard and Sonoco Products Company 3.1 Restated Articles of Incorporation, as amended April 21, 2022 (incorporated by reference to Exhibit 3.1 to the Registrants Form 8-K filed April 22, 2022) 3.2 By-Laws of Sonoco Products Company, as amended October 17, 2023 (incorporated by reference to Exhibit 3.2 to the Registrants Form 8-K, filedOctober 19, 2023) 31 Certifications of Chief Executive Officer and Chief Financial Officer Pursuant to Section302 of the Sarbanes-Oxley Act of 2002 and 17 C.F.R. 240.13a-14(a) 32 Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section906 of the Sarbanes-Oxley Act of 2002 and 17 C.F.R. 240.13a-14(b)

Customer name	Ticker
Philip Morris International Inc.	PM
Starbucks Corporation	SBUX
ProShares Ultra 7-10 Year Treasury	UST
The Wendy's Company	WEN

Supplier name	Ticker
Albemarle Corporation	ALB
Avery Dennison Corporation	AVY
Danaher Corporation	DHR
Ecolab Inc.	ECL
RPM International Inc.	RPM
Univar Solutions Inc.	UNVR

SON 10-Q Quarter ended March 30, 2025

Exhibits