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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 ~~June~~September 30, 2024


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

For the transition period from __________to __________

Commission File Number: 001-39528

PACTIV EVERGREEN INC.

(Exact Name of Registrant as Specified in Its Charter)

    Delaware

    88-0927268

    (State or Other Jurisdiction of 
Incorporation or Organization)

    (I.R.S. Employer
Identification Number)

1900 W. Field Court

Lake Forest, Illinois 60045

(Address of principal executive offices) (Zip Code)

Telephone: (847) 482-2000

(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
Common stock, $0.001 par value	PTVE	The Nasdaq Stock Market LLC

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 for 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 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 by Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The registrant had 179,~~254~~291,~~637~~280 shares of common stock, $0.001 par value per share, outstanding as of ~~July~~November 267, 2024.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Statements of Income (Loss)	3
	Condensed Consolidated Statements of (Loss) Income	3
	Condensed Consolidated Statements of Comprehensive Income (Loss)	4
	Condensed Consolidated Statements of Comprehensive (Loss) Income	4
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Equity	6
	Condensed Consolidated Statements of Cash Flows	7
	Notes to the Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	36
Item 4.	Controls and Procedures	36
PART II.	OTHER INFORMATION	37
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38
	Signatures	4039

FORWARD-LOOKING STATEMENTS

This report contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies, anticipated trends in our business and anticipated growth in the markets served by our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed under the caption entitled “Risk Factors” section in our Annual Report on Form 10-K for the year ended December 31, 2023. You should specifically consider these numerous risks. These risks include, among others, those related to:

•

fluctuations in raw material, energy and freight costs;

•

failure to maintain satisfactory relationships with our major customers;

•

the global macroeconomic environment, including inflation, consumer demand, global supply chain challenges and other macroeconomic and geopolitical issues;

•

our dependence on suppliers of raw materials and any interruption to our supply of raw materials;

•

labor shortages and increased labor costs;

•

the impact of natural disasters, public health crises and catastrophic events outside of our control;

•

our ability to successfully complete acquisitions, divestitures, investments and other similar transactions that we pursue from time to time;

•

our ability to realize the benefits of our capital investment, acquisitions, restructuring and other cost savings programs;

•

changes in consumer lifestyle, eating habits, nutritional preferences and health-related, environmental and sustainability concerns;

•

our safety performance;

•

competition in the markets in which we operate;

•

the impact of our significant debt on our financial condition and ability to operate our business;

•

compliance with, and liabilities related to, applicable laws and regulations;

•

our aspirations and disclosures related to ESG matters; and

•

the ownership of a majority of the voting power of our common stock by our parent company Packaging Finance Limited, which we refer to as PFL, an entity beneficially owned by Mr. Graeme Hart.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. We are under no duty to update any of these forward-looking statements after the date of this report to conform our prior statements to actual results or revised expectations.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Pactiv Evergreen Inc.

Condensed Consolidated Statements of ~~Income~~ (Loss) Income

(In millions, except per share amounts)

(Unaudited)

	For the Three Months Ended						For the ~~Six~~Nine Months Ended
	June 30,						June 30,
	September 30,						September 30,
	2024			2023			2024			2023
Net revenues	$	1,~~255~~250		$	1,~~331~~286		$	23,~~427~~677		$	23,~~654~~940
Related party net revenues		83			9593			~~163~~246			~~203~~296
Total net revenues		1,~~338~~333			1,~~426~~379			23,~~590~~923			24,~~857~~236
Cost of sales		(1,~~115~~078	)		(1,~~342~~098	)		(23,~~146~~224	)		(23,~~658~~756	)
Gross profit		~~223~~255			84281			~~444~~699			~~199~~480
Selling, general and administrative expenses		(~~122~~115	)		(~~136~~137	)		(~~255~~370	)		(~~266~~403	)
Restructuring, asset impairment and other related charges		(6338	)		(3228	)		(23361	)		(~~105~~133	)
Other income, net		2			4			5			4
Other income (expense), net		2			(3	)		7			1
Operating income (loss)		97			(80	)		171			(168	)
Operating (loss) income from continuing operations		(196	)		113			(25	)		(55	)
Non-operating expense, net		—			(3	)		—			(4	)
Non-operating income (expense), net		1			(2	)		1			(6	)
Interest expense, net		(6656	)		(6461	)		(~~125~~181	)		(~~127~~188	)
Income (loss) before tax		31			(147	)		46			(299	)
(Loss) income from continuing operations before tax		(251	)		50			(205	)		(249	)
Income tax (expense) benefit		(11	)		8			(16	)		27
Income tax benefit (expense)		38			(22	)		22			5
Net income (loss)		20			(139	)		30			(272	)
(Loss) income from continuing operations		(213	)		28			(183	)		(244	)
Income attributable to non-controlling interests		(1	)		—			(2	)		(1	)
Income from discontinued operations, net of income taxes		—			2			—			2
Net income (loss) attributable to Pactiv Evergreen Inc. common shareholders	$	19		$	(139	)	$	28		$	(273	)
Net (loss) income		(213	)		30			(183	)		(242	)
Earnings (loss) per share attributable to Pactiv Evergreen Inc. common shareholders
Income attributable to non-controlling interests		—			(1	)		(2	)		(2	)
Basic	$	0.11		$	(0.78	)	$	0.14		$	(1.54	)
Net (loss) earnings attributable to Pactiv Evergreen Inc. common shareholders	$	(213	)	$	29		$	(185	)	$	(244	)
Diluted	$	0.10		$	(0.78	)	$	0.14		$	(1.54	)
(Loss) earnings per share attributable to Pactiv Evergreen Inc. common shareholders
From continuing operations
Basic	$	(1.18	)	$	0.15		$	(1.04	)	$	(1.39	)
Diluted	$	(1.18	)	$	0.15		$	(1.04	)	$	(1.39	)
From discontinued operations
Basic	$	—		$	0.01		$	—		$	0.01
Diluted	$	—		$	0.01		$	—		$	0.01
Total
Basic	$	(1.18	)	$	0.16		$	(1.04	)	$	(1.38	)
Diluted	$	(1.18	)	$	0.16		$	(1.04	)	$	(1.38	)

See accompanying notes to the condensed consolidated financial statements.

Pactiv Evergreen Inc.

Condensed Consolidated Statements of Comprehensive ~~Income~~ (Loss) Income

(In millions)

(Unaudited)

	For the Three Months Ended						For the ~~Six~~Nine Months Ended
	June 30,						June 30,
	September 30,						September 30,
	2024			2023			2024			2023
Net income (loss)	$	20		$	(139	)	$	30		$	(272	)
Net (loss) income	$	(213	)	$	30		$	(183	)	$	(242	)
Other comprehensive (loss) income, net of income taxes:
Currency translation adjustments		(1912	)		10(5	)		(1830	)		2419
Defined benefit plans		(1	)		—(1	)		(23	)		(12	)
Foreign exchange derivatives		2—			—			1			—
Interest rate derivatives		—(9	)		144			6(3	)		812
Other comprehensive (loss) income		(1822	)		24(2	)		(1335	)		3129
Comprehensive income (loss)		2			(115	)		17			(241	)
Comprehensive (loss) income		(235	)		28			(218	)		(213	)
Comprehensive income attributable to non-controlling interests		(1—	)		—(1	)		(2	)		(12	)
Comprehensive income (loss) attributable to Pactiv Evergreen Inc. common shareholders	$	1		$	(115	)	$	15		$	(242	)
Comprehensive (loss) income attributable to Pactiv Evergreen Inc. common shareholders	$	(235	)	$	27		$	(220	)	$	(215	)

See accompanying notes to the condensed consolidated financial statements.

Pactiv Evergreen Inc.

Condensed Consolidated Balance Sheets

(In millions, except share amounts)

(Unaudited)

	As of			As of
	June 30, 2024			December 31, 2023
	September 30, 2024			December 31, 2023
Assets
Cash and cash equivalents	$	95168		$	164
Accounts receivable, net of allowances of $2 and $3		486			426
Accounts receivable, net of allowances of $2 and $2		463			426
Related party receivables		3728			35
Inventories		~~881~~760			852
Other current assets		~~116~~126			~~112~~108
Total current assets		1,615			1,589
Assets held for sale		99			4
Property, plant and equipment, net		1,473			1,511
Total current assets		1,644			1,589
Operating lease right-of-use assets, net		272			263
Property, plant and equipment, net		1,164			1,511
Goodwill		1,815			1,815
Operating lease right-of-use assets, net		268			263
Intangible assets, net		974			1,004
Goodwill		1,807			1,815
Other noncurrent assets		213			213
Intangible assets, net		959			1,004
Total assets	$	6,362		$	6,395
Other noncurrent assets		209			213
Total assets	$	6,051		$	6,395
Liabilities
Accounts payable	$	~~367~~382		$	300
Related party payables		7			7
Current portion of long-term debt		206			15
Current portion of operating lease liabilities		6662			64
Income taxes payable		123			11
Accrued and other current liabilities		~~321~~372			399
Total current liabilities		793			796
Liabilities held for sale		22			—
Long-term debt		3,572			3,571
Total current liabilities		854			796
Long-term operating lease liabilities		223			217
Long-term debt		3,489			3,571
Deferred income taxes		226			244
Long-term operating lease liabilities		222			217
Long-term employee benefit obligations		57			57
Deferred income taxes		185			244
Other noncurrent liabilities		155			161
Long-term employee benefit obligations		56			57
Total liabilities	$	5,026		$	5,046
Other noncurrent liabilities		156			161
Total liabilities	$	4,962		$	5,046
Commitments and contingencies (Note 11)
Equity
Common stock, $0.001 par value; 2,000,000,000 shares authorized; 179,254,637 and 178,557,086 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively	$	—		$	—
Common stock, $0.001 par value; 2,000,000,000 shares authorized; 179,287,052 and 178,557,086 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively	$	—		$	—
Preferred stock, $0.001 par value; 200,000,000 shares authorized; no shares issued or outstanding		—			—
Additional paid in capital		~~685~~691			676
Accumulated other comprehensive loss		(5072	)		(37	)
Retained earnings		~~697~~466			706
Total equity attributable to Pactiv Evergreen Inc. common shareholders		1,~~332~~085			1,345
Non-controlling interests		4			4
Total equity		1,~~336~~089			1,349
Total liabilities and equity	$	6,~~362~~051		$	6,395

See accompanying notes to the condensed consolidated financial statements.

Pactiv Evergreen Inc.

Condensed Consolidated Statements of Equity

(In millions, except per share amounts)

(Unaudited)

								Accumulated
					Additional			Other						Non-
	Common Stock				Paid in			Comprehensive			Retained			Controlling			Total
	Shares		Amount		Capital			~~Income (~~Loss)			Earnings			Interests			Equity
For the Three Months Ended June 30, 2023
For the Three Months Ended September 30, 2023
Balance as of March 31, 2023		178.3	$	—	$	650		$	(95	)	$	851		$	4			1,410
Net loss		—		—		—			—			(139	)		—			(139	)
Other comprehensive income, net of income taxes		—		—		—			24			—			—			24
Equity based compensation		—		—		10			—			—			—			10
Vesting of restricted stock units, net of tax withholdings		0.1		—		—			—			—			—			—
Dividends declared - common shareholders ($0.10 per share)		—		—		—			—			(19	)		—			(19	)
Dividends declared - non-controlling interests		—		—		—			—			—			(1	)		(1	)
Balance as of June 30, 2023		178.4	$	—	$	660		$	(71	)	$	693		$	3		$	1,285
For the Three Months Ended June 30, 2024
Net income		—		—		—			—			29			1			30
Balance as of March 31, 2024		179.1	$	—	$	679		$	(32	)	$	697		$	4		$	1,348
Other comprehensive loss, net of income taxes		—		—		—			(2	)		—			—			(2	)
Net income		—		—		—			—			19			1			20
Equity based compensation		—		—		9			—			—			—			9
Other comprehensive loss, net of income taxes		—		—		—			(18	)		—			—			(18	)
Vesting of restricted stock units, net of tax withholdings		0.1		—		—			—			—			—			—
Equity based compensation		—		—		6			—			—			—			6
Dividends declared - common shareholders ($0.10 per share)		—		—		—			—			(18	)		—			(18	)
Vesting of restricted stock units, net of tax withholdings		0.2		—		—			—			—			—			—
Balance as of September 30, 2023		178.5	$	—	$	669		$	(73	)	$	704		$	4		$	1,304
Dividends declared - common shareholders ($0.10 per share)		—		—		—			—			(19	)		—			(19	)
For the Three Months Ended September 30, 2024
Dividends declared - non-controlling interests		—		—		—			—			—			(1	)		(1	)
Balance as of June 30, 2024		179.3	$	—	$	685		$	(50	)	$	697		$	4		$	1,336
For the Six Months Ended June 30, 2023
Net loss		—		—		—			—			(213	)		—			(213	)
Balance as of December 31, 2022		177.9	$	—	$	647		$	(102	)	$	1,003		$	5			1,553
Other comprehensive loss, net of income taxes		—		—		—			(22	)		—			—			(22	)
Net (loss) income		—		—		—			—			(273	)		1			(272	)
Equity based compensation		—		—		6			—			—			—			6
Other comprehensive income, net of income taxes		—		—		—			31			—			—			31
Dividends declared - common shareholders ($0.10 per share)		—		—		—			—			(18	)		—			(18	)
Equity based compensation		—		—		15			—			—			—			15
Balance as of September 30, 2024		179.3	$	—	$	691		$	(72	)	$	466		$	4		$	1,089
Vesting of restricted stock units, net of tax withholdings		0.5		—		(2	)		—			—			—			(2	)
For the Nine Months Ended September 30, 2023
Dividends declared - common shareholders ($0.20 per share)		—		—		—			—			(37	)		—			(37	)
Balance as of December 31, 2022		177.9	$	—	$	647		$	(102	)	$	1,003		$	5		$	1,553
Net (loss) income		—		—		—			—			(244	)		2			(242	)
Other comprehensive income, net of income taxes		—		—		—			29			—			—			29
Equity based compensation		—		—		24			—			—			—			24
Vesting of restricted stock units, net of tax withholdings		0.6		—		(2	)		—			—			—			(2	)
Dividends declared - common shareholders ($0.30 per share)		—		—		—			—			(55	)		—			(55	)
Dividends declared - non-controlling interests		—		—		—			—			—			(2	)		(2	)
Disposal of subsidiary		—		—		—			—			—			(1	)		(1	)
Balance as of June 30, 2023		178.4	$	—	$	660		$	(71	)	$	693		$	3		$	1,285
Balance as of September 30, 2023		178.5	$	—	$	669		$	(73	)	$	704		$	4		$	1,304
For the Six Months Ended June 30, 2024
For the Nine Months Ended September 30, 2024
Balance as of December 31, 2023		178.6	$	—	$	676		$	(37	)	$	706		$	4		$	1,349
Net income		—		—		—			—			28			2			30
Net (loss) income		—		—		—			—			(185	)		2			(183	)
Other comprehensive loss, net of income taxes		—		—		—			(1335	)		—			—			(1335	)
Equity based compensation		—		—		1319			—			—			—			1319
Vesting of restricted stock units, net of tax withholdings		0.7		—		(4	)		—			—			—			(4	)
Dividends declared - common shareholders ($0.20 per share)		—		—		—			—			(37	)		—			(37	)
Dividends declared - common shareholders ($0.30 per share)		—		—		—			—			(55	)		—			(55	)
Dividends declared - non-controlling interests		—		—		—			—			—			(2	)		(2	)
Balance as of June 30, 2024		179.3	$	—	$	685		$	(50	)	$	697		$	4		$	1,336
Balance as of September 30, 2024		179.3	$	—	$	691		$	(72	)	$	466		$	4		$	1,089

See accompanying notes to the condensed consolidated financial statements.

Pactiv Evergreen Inc.

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)

	For the Six Months Ended June 30,
	For the Nine Months Ended September 30,
	2024			2023
Operating Activities:
Net income (loss)	$	30		$	(272	)
Net loss	$	(183	)	$	(242	)
Adjustments to reconcile net income (loss) to operating cash flows:
Adjustments to reconcile net loss to operating cash flows:
Depreciation and amortization		~~159~~234			~~433~~518
Deferred income taxes		(1654	)		(67	)
Asset impairment and restructuring related non-cash charges (net of reversals)		2325			4144
Non-cash portion of operating lease expense		4263			4060
Equity based compensation		1319			1524
Other non-cash items, net		—2			711
Change in assets and liabilities:
Accounts receivable, net		(6839	)		(710	)
Inventories		(3014	)		~~108~~183
Accounts payable		7487			(2742	)
Operating lease payments		(4263	)		(4160	)
Accrued and other current liabilities		(9027	)		~~(18~~25	)
Other assets and liabilities		(1345	)		39
Net cash provided by operating activities		61305			~~215~~453
Investing Activities:
Acquisition of property, plant and equipment		(98152	)		(~~116~~178	)
Purchase of investments		(23	)		—
Receipt of refundable exclusivity payment		10			—
Other investing activities		1112			211
Net cash used in investing activities		(~~100~~153	)		(~~114~~167	)
Financing Activities:
Term loan debt proceeds		372			—
Term loan debt repayments		(~~725~~795	)		(~~294~~523	)
Revolver proceeds		391			—
Revolver repayments		(3661	)		—
Deferred financing transaction costs		(7	)		—
Dividends paid to common shareholders		(3654	)		(3654	)
Other financing activities		(1114	)		(710	)
Net cash used in financing activities		(52168	)		(~~337~~587	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(13	)		51
Decrease in cash, cash equivalents and restricted cash		(9219	)		(~~231~~300	)
Cash, cash equivalents and restricted cash, including amounts classified as held for sale, as of beginning of the period		187			557
Cash, cash equivalents and restricted cash as of end of the period	$	95168		$	~~326~~257
Cash, cash equivalents and restricted cash are comprised of:
Cash and cash equivalents		95168			~~302~~233
Restricted cash classified as other noncurrent assets		—			24
Cash, cash equivalents and restricted cash as of end of the period	$	95168		$	~~326~~257
Cash paid:
Interest paid, net		~~116~~148			~~135~~177
Income taxes paid, net		3748			3151

Significant non-cash investing and financing activities

During the ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, we recognized operating lease right-of-use assets and lease liabilities of $4362 million and $3963 million, respectively.

See accompanying notes to the condensed consolidated financial statements.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 1. Nature of Operations and Basis of Presentation

The accompanying condensed consolidated financial statements comprise the accounts of Pactiv Evergreen Inc. (“PTVE”) and its subsidiaries (“we”, “us”, “our” or the “Company”) and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated interim financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary for a fair statement of the results for the interim periods and should be read in conjunction with the consolidated financial statements and the related notes thereto included in our latest Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 29, 2024. Operating results for interim periods are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. All intercompany transactions and balances have been eliminated in consolidation.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Although our current estimates contemplate current conditions and how we expect them to change in the future, as appropriate, it is reasonably possible that actual conditions could differ from what was anticipated in those estimates, which could materially affect our results of operations, balance sheet and cash flows. Among other effects, such changes could result in future impairments of goodwill, intangibles and long-lived assets, and adjustments to reserves for employee benefits and income taxes. The estimated recoverable amounts associated with asset impairments represent Level 3 measurements in the fair value hierarchy, which include inputs that are not based on observable market data.

Reclassifications ~~and Revision to Restricted Cash~~

We made reclassifications to certain previously reported financial information to conform to our current period presentation.

During 2023, we revised the presentation of restricted cash balances on our condensed consolidated statements of cash flows to include restricted cash in the beginning and ending balances for all periods presented. As of June 30, 2023 and December 31, 2022, our consolidated balance sheets included $24 million of restricted cash classified as noncurrent assets. There was no impact to our operating, investing or financing cash flow activities. The impact to all previously reported interim and annual periods was not material. As of June 30, 2024, there were no restricted cash balances on our condensed consolidated balance sheet.

Recent Accounting Pronouncements

We reviewed all recently issued accounting pronouncements and, except for the items below, concluded that they were either not applicable or not expected to have a significant impact on our condensed consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07 Segment Reporting - Improving Reportable Segment Disclosures (Topic 280). The ASU is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker (the “CODM”), a description of other segment items by reportable segment and, if necessary, any additional measures of a segment’s profit or loss used by the CODM when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the amendments should be applied on a retrospective basis to all prior periods presented in the financial statements. WeAlthough we are ~~currently~~still assessing, we expect the ~~impact~~adoption of ~~adopting~~this ASU to result in additional disclosure of certain segment expenses in the ~~updated~~footnotes ~~provisions~~to our consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09 Income Taxes - Improvements to Income Tax Disclosures (Topic 740) requiring enhanced income tax disclosures. The ASU requires the disclosure of specific categories and disaggregation of information in the rate reconciliation table. The ASU also requires disclosure of disaggregated information related to income taxes paid, income or loss from continuing operations before income tax expense or benefit, and income tax expense or benefit from continuing operations. The requirements of the ASU are effective for annual periods beginning after December 15, 2024. Early adoption is permitted and the amendments should be applied on a prospective basis. We are currently assessing the impact of the ASU on our related disclosures.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

~~annual~~or ~~periods~~financial condition. The required information about climate-related risks also includes disclosure of a registrant’s greenhouse gas emissions. In addition, the rules would require registrants to include certain climate-related financial disclosures in their audited financial statements. As adopted, these disclosure requirements would be phased in over several years beginning ~~after~~with our Annual Report on Form 10-K for the fiscal year ended December 1531, ~~2024~~2026. ~~Early~~However, ~~adoption~~while isthe ~~permitted~~SEC ~~and~~has adopted these rules, the ~~amendments~~rules ~~should~~have bebeen ~~applied~~stayed onand aare ~~prospective~~subject ~~basis~~to pending legal and political challenges causing significant uncertainty regarding when and how they will ultimately apply to us. We are currently assessing the impact of ~~the~~these ~~ASU~~rules on our consolidated financial statements and related disclosures.

In March 2024, the SEC adopted final rules under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors, which, as adopted, require registrants to include certain climate-related information in their annual reports and registration statements. The rules require, among other matters, information about climate-related risks that are reasonably likely to have a material impact on a registrant’s business, results of operations or financial condition. The required information about climate-related risks also includes disclosure of a registrant’s greenhouse gas emissions. In addition, the rules would require registrants to include certain climate-related financial disclosures in their audited financial statements. As adopted, these disclosure requirements would be phased in over several years beginning with our Annual Report on Form 10-K for the fiscal year ended December 31, 2026. However, while the SEC has adopted these rules, the rules have been stayed and are subject to pending legal and political challenges causing significant uncertainty regarding when and how they will ultimately apply to us. We are currently assessing the impact of these rules on our consolidated financial statements and related disclosures.

Note 2. Restructuring, Asset Impairment and Other Related Charges

Footprint Optimization

On February 29, 2024, we announced the Footprint Optimization, a restructuring plan approved by our Board of Directors to optimize our manufacturing and warehousing footprint that we expect will improve our operating efficiency. We expect to incur capital expenditures of $40 million to $45 million, total cash restructuring charges of $50 million to $65 million and total non-cash charges of $20 million to $40 million, each primarily during 2024 and 2025, to execute our plan. For the ~~six~~three and nine months ended ~~June~~September 30, 2024, we incurred cash charges of $83 million and $11 million, respectively, primarily related to severance and other exit costs. For the three ~~months ended June 30, 2024, cash charges were insignificant. For the three~~ and ~~six~~nine months ended ~~June~~September 30, 2024, we incurred non-cash charges of $31 million and $56 million, respectively, primarily related to accelerated property, plant and equipment depreciation. The estimated ranges of restructuring charges are provisional and include significant management judgments and assumptions that could change materially as we execute our plans. Actual results may differ from these estimates, and the execution of our plan could result in additional restructuring charges or impairments.

Beverage Merchandising Restructuring

On March 6, 2023, we announced the Beverage Merchandising Restructuring, a plan approved by our Board of Directors to take significant restructuring actions related to our Beverage Merchandising operations. The Beverage Merchandising Restructuring includes, among other things:

•

Closure of our Canton, North Carolina mill, including the cessation of mill operations, during the second quarter of 2023;

•

Closure of our Olmsted Falls, Ohio converting facility and concurrent reallocation of certain production to our remaining converting facilities during the second quarter of 2023; and

•

Reorganizing our operating and reporting structure to achieve increased efficiencies and related cost savings.

Additionally, the plan included the exploration of strategic alternatives for our Pine Bluff, Arkansas mill and our Waynesville, North Carolina extrusion facility (the “Facilities”). Following authorization by our Board of Directors on July 12, 2024, we entered into a definitive agreement to sell the Facilities and associated assets and liabilities to Suzano S.A. (“Suzano”) (the “Mill Transaction”). Under the terms of the agreement, the purchase price is $110 million, subject to certain customary adjustments at closing such as working capital. During the three months ended June 30, 2024, we received a $10 million refundable exclusivity payment from Suzano related to the then-current negotiations of a potential sale agreement for the Facilities that would be applied against the final purchase price if a transaction were consummated, which is recorded in other accrued liabilities in the condensed consolidated balance sheet as of June 30, 2024. We also agreed to enter into a long-term liquid packaging board supply arrangement with Suzano upon closing of the Mill Transaction.

The Mill Transaction closed on October 1, 2024. We received preliminary proceeds of $83 million, inclusive of the $10 million exclusivity payment previously received during the second quarter of 2024 and the preliminary calculation of customary adjustments for closing amounts, such as working capital. The exclusivity payment was recorded in other accrued liabilities in the condensed consolidated balance sheet as of September 30, 2024. The proceeds received are subject to finalization of the aforementioned closing adjustments. We also entered into a long-term liquid packaging board supply arrangement with Suzano upon closing of the Mill Transaction.

We classified the assets and liabilities of the Facilities, including an allocated portion of the goodwill associated with the Beverage Merchandising reporting unit, as held for sale as of July 12, 2024. Upon qualifying as held for sale, we measured the disposal group at the lower of its carrying value and its fair value, less costs to sell, and recognized an impairment charge of $314 million. In addition to this charge, we recorded an $8 million goodwill impairment charge related to the disposal group. The operations of the Facilities did not meet the criteria to be presented as discontinued operations. Additionally, we evaluated the assets of our Beverage Merchandising reporting unit that were not allocated to the disposal group for impairment and determined no additional impairment charge was warranted.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

WeThe ~~are~~carrying ~~currently~~amounts ~~evaluating the financial statement impacts~~ of the ~~Mill~~major ~~Transaction.~~classes ~~Based on estimated net proceeds, we currently expect to record a non-cash impairment charge~~ of ~~approximately $320 million to $340 million in~~ the ~~third~~Facilities’ ~~quarter of 2024 upon classification of the related~~ assets and liabilities classified as held for sale, ~~following~~as ~~approval by our Board~~ of ~~Directors~~September ~~of the transaction. The sale price is subject to certain adjustments~~30, ~~and therefore the estimated impairment is subject to change. The Mill Transaction is expected to close in the fourth quarter of~~ 2024, ~~subject~~comprised ~~to customary closing conditions, including foreign antitrust approval. We do not expect~~ the ~~Facilities and associated assets to qualify as discontinued operations.~~following:

As a result of the Beverage Merchandising Restructuring, we incurred charges during the three and six months ended June 30, 2024, and we estimate we will incur further charges in future periods, as follows:


	As of September 30, 2024
Inventories	$	103
Property, plant and equipment, net		301
Other current assets		9
Held for sale valuation allowance		(314	)
Total current assets held for sale	$	99
Other current liabilities	$	(22	)
Total current liabilities held for sale	$	(22	)

	For the Three Months Ended June 30, 2024			For the Six Months Ended June 30, 2024			Cumulative ChargesIncurred to Date		Total Expected Charges(1)(2)
Non-cash:
Accelerated property, plant and equipment depreciation	$	3		$	6		$	280	$	280
Mill Transaction impairment charges		—			—			—	320 - 340
Other non-cash charges(3)		(1	)		(1	)		49		50
Total non-cash charges	$	2		$	5		$	329	$ 650 - 670
Cash:
Severance, termination and related costs		—			1			44		45
Exit, disposal and other transition costs(4)		5			12			115		115
Total cash charges	$	5		$	13		$	159	$	160
Total Beverage Merchandising Restructuring charges	$	7		$	18		$	488	$ 810 - 830

As a result of the Beverage Merchandising Restructuring, we incurred charges during the three and nine months ended September 30, 2024, and we estimate we will incur further charges in future periods, as follows:

We expect to incur any remaining charges primarily in 2024. These charges include certain estimates that are provisional and include significant management judgments and assumptions that could change materially as we complete the execution of our plans. Actual results may differ from these estimates, and the completion of our plan could result in additional restructuring charges or impairments not reflected above.


	For the Three Months Ended September 30, 2024		For the Nine Months Ended September 30, 2024			Cumulative Charges Incurred to Date		Total Expected Charges(1)(2)
Non-cash:
Accelerated property, plant and equipment depreciation	$	3	$	9		$	283	$	286
Mill Transaction impairment charges(3)		322		322			322		322
Other non-cash charges(4)		—		(1	)		49		52
Total non-cash charges	$	325	$	330		$	654	$	660
Cash:
Severance, termination and related costs		1		2			45		46
Exit, disposal and other transition costs(5)		10		22			125		129
Total cash charges	$	11	$	24		$	170	$	175
Total Beverage Merchandising Restructuring charges	$	336	$	354		$	824	$	835

(1)

~~Total~~We ~~cash~~expect ~~charges~~to ~~exclude~~incur ~~the benefit of~~ any ~~potential~~remaining ~~cash~~charges ~~proceeds~~primarily ~~related~~in to2024. ~~possible~~These ~~sales~~charges ofinclude ~~any~~certain ~~property,~~estimates ~~plant and equipment~~ that ~~may~~are beprovisional ~~disposed~~and ofinclude assignificant ~~part~~management ofjudgments ~~our~~and ~~ongoing~~assumptions ~~restructuring~~that ~~activities.~~could ~~During~~change ~~the~~materially ~~year~~as ~~ended December 31, 2023,~~ we ~~received~~complete ~~$4 million in cash proceeds and recognized an immaterial gain on~~ the ~~sale~~execution of ~~various~~our ~~assets~~plans. ~~During~~Actual ~~the~~results ~~six~~may ~~months~~differ ~~ended~~from ~~June~~these 30estimates, ~~2024,~~and ~~we received $4 million in proceeds, primarily related to~~ the ~~sale~~completion of our ~~Olmsted~~plan ~~Falls,~~could ~~Ohio~~result ~~facility~~in ~~that~~additional ~~was~~restructuring ~~previously~~charges, ~~classified as held for sale~~gains, ~~resulting~~losses inor animpairments ~~immaterial~~not ~~gain~~reflected above.

(2)

Total cash charges exclude the benefit of any cash proceeds related to sales of any property, plant and equipment that may be disposed of as part of our ongoing restructuring activities. During the year ended December 31, 2023, we received $4 million in cash proceeds and recognized an immaterial gain on the sale of various assets. In addition to the Mill Transaction discussed above, during the nine months ended September 30, 2024, we also received $4 million in proceeds, primarily related to the sale of our Olmsted Falls, Ohio facility that was previously classified as held for sale, resulting in an immaterial gain.

(3)

Mill Transaction impairment charges included a goodwill impairment charge of $8 million related to the Facilities disposal group.

(4)

Other non-cash charges include the write-down of certain spare parts classified as inventories on our condensed consolidated balance sheet, the write-off of scrapped raw materials and certain construction in-progress balances, accelerated amortization expense for certain operating lease right-of-use assets and gains or losses on the sale of various property, plant and equipment.

(5)

Exit, disposal and other transition costs are primarily related to equipment decommissioning and dismantlement, transition labor associated with the facility closures and management restructuring, site remediation, contract terminations, systems conversion and other related costs.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

The Beverage Merchandising Restructuring charges, Footprint Optimization charges and other restructuring and asset impairment charges (net of reversals) were classified on our condensed consolidated statements of ~~income~~ (loss) income as follows by segment:

	Food and BeverageMerchandising		Foodservice			Other		Total
For the Three Months Ended June 30, 2024
For the Three Months Ended September 30, 2024
Cost of sales(1)	$	54	$	1—		$	—	$	64
Restructuring, asset impairment and other related charges(2)		6		—			—		6
Restructuring, asset impairment and other related charges (net of reversals)(2)		337		(1	)		2		338
Total	$	11341	$	(1	)	$	—2	$	12342
For the Three Months Ended June 30, 2023
For the Three Months Ended September 30, 2023
Cost of sales	$	~~182~~4	$	—		$	—	$	~~182~~4
Selling, general and administrative expenses		3—		—			—		3—
Restructuring, asset impairment and other related charges		2924		—			34		3228
Total	$	~~214~~28	$	—		$	34	$	~~217~~32
For the Six Months Ended June 30, 2024
For the Nine Months Ended September 30, 2024
Cost of sales(1)	$	913	$	1		$	—	$	1014
Restructuring, asset impairment and other related charges(2)		16353		54			24		23361
Total	$	25366	$	65		$	24	$	33375
For the Six Months Ended June 30, 2023
For the Nine Months Ended September 30, 2023
Cost of sales	$	~~294~~298	$	—		$	—	$	~~294~~298
Selling, general and administrative expenses		4		—			—		4
Restructuring, asset impairment and other related charges		98122		—			711		~~105~~133
Total	$	~~396~~424	$	—		$	711	$	~~403~~435

(1)

Included $31 million ~~and $5 million, respectively,~~ of non-cash charges related to the Footprint Optimization for the three ~~and six~~ months ended ~~June~~September 30, 2024, all of which $1was ~~million~~recorded ~~relates~~in to our ~~Foodservice~~Food and Beverage Merchandising segment, inand ~~both~~$6 million of non-cash charges related to the ~~three~~Footprint ~~and~~Optimization ~~six~~for the nine months ended ~~June~~September 30, 2024, ~~and~~of which $21 million related to our Foodservice segment and $45 million ~~relate~~related to our Food and Beverage Merchandising segment ~~for the three and six months ended June 30, 2024, respectively~~.

(2)

Included $8322 million of non-cash impairment charges related to the ~~Footprint~~Mill ~~Optimization~~Transaction for the ~~six~~three and nine months ended ~~June~~September 30, 2024, ofall ~~which~~related $5to ~~million~~the ~~relates~~Food toand ~~our~~Beverage ~~Foodservice~~Merchandising segment. ~~and~~Also included $3 million ~~relates~~and to$11 ~~our~~million ~~Food~~of ~~and~~cash ~~Beverage~~charges ~~Merchandising~~related ~~segment. For~~to the Footprint Optimization for the three and nine months ended ~~June~~September 30, 2024, ~~cash~~of ~~charges~~which a $1 million reversal and $4 million of expense related to ~~the~~our ~~Footprint~~Foodservice ~~Optimization~~segment ~~were~~and ~~insignificant~~$4 million and $7 million related to our Food and Beverage Merchandising segment, respectively.

During the ~~three~~nine months ended ~~June~~September 30, 2024, we recorded a non-cash impairment charge of $2 million related to our equity interests in a joint venture located in the Middle East region, which is reported within the Food and Beverage Merchandising operating segment.

During the three months ended September 30, 2024, we recorded cash charges of $2 million for severance related to other corporate overhead restructuring and the resulting reduction in force, which is recorded in Other.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

The following table summarizes the changes to our restructuring liability for the ~~six~~nine months ended ~~June~~September 30, 2024:

	December 31, 2023		Charges to Earnings		Cash Paid			~~June~~September 30, 2024
Beverage Merchandising Restructuring
Severance, termination and related costs	$	9	$	12	$	(67	)	$	4
Exit, disposal and other transition costs		30		1222		(2228	)		2024
Footprint Optimization
Severance, termination and related costs		—		89		—			89
Total(1)	$	39	$	21	$	(28	)	$	32
Exit, disposal and other transition costs		—		2		(1	)		1
Other
Severance, termination and related costs		—		2		(2	)		—
Total(1)	$	39	$	37	$	(38	)	$	38

(1)

Comprises $2834 million classified within accrued and other current liabilities and $4 million classified within other noncurrent liabilities as of ~~June~~September 30, 2024.

Note 3. Inventories

The components of inventories consisted of the following:

	As of		As of
	June 30, 2024		December 31, 2023
	September 30, 2024		December 31, 2023
Raw materials	$	~~211~~193	$	223
Work in progress		9388		67
Finished goods		~~471~~404		465
Spare parts		~~106~~75		97
Inventories	$	~~881~~760	$	852

Note 4. Property, Plant and Equipment, Net

Property, plant and equipment, net consisted of the following:

	As of			As of
	June 30, 2024			December 31, 2023
	September 30, 2024			December 31, 2023
Land and land improvements	$	7162		$	71
Buildings and building improvements		~~708~~647			690
Machinery and equipment		3,~~713~~054			3,669
Construction in progress		~~178~~169			193
Property, plant and equipment, at cost		43,~~670~~932			4,623
Less: accumulated depreciation		(32,~~197~~768	)		(3,112	)
Property, plant and equipment, net	$	1,~~473~~164		$	1,511

Depreciation expense related to property, plant and equipment was recognized in the following components in the condensed consolidated statements of ~~income~~ (loss) income:

	For the Three Months Ended				For the ~~Six~~Nine Months Ended
	June 30,				June 30,
	September 30,				September 30,
	2024		2023		2024		2023
Cost of sales	$	5954	$	~~234~~62	$	~~117~~171	$	~~386~~448
Selling, general and administrative expenses		6		108		1218		1725
Total depreciation expense(1)	$	6560	$	~~244~~70	$	~~129~~189	$	~~403~~473

(1)

For the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, total depreciation expense included $5 million, $914 million, $~~177~~4 million and $~~267~~271 million, respectively, of accelerated depreciation expense related to the restructuring programs, substantially all of which was included in cost of sales. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 5. Goodwill and Intangible Assets

Goodwill by reportable segment was as follows:

	Foodservice		Food and BeverageMerchandising			Total
As of December 31, 2023	$	958	$	857		$	1,815
Movements		—		—			—
Reclassification to assets held for sale		—		(8	)		(8	)
As of June 30, 2024	$	958	$	857		$	1,815
As of September 30, 2024	$	958	$	849		$	1,807

Intangible assets, net consisted of the following:

	As of June 30, 2024							As of December 31, 2023
	As of September 30, 2024							As of December 31, 2023
	GrossCarryingAmount		AccumulatedAmortization			Net		GrossCarryingAmount		AccumulatedAmortization			Net
Finite-lived intangible assets
Customer relationships	$	1,~~059~~060	$	(~~723~~738	)	$	~~336~~322	$	1,062	$	(698	)	$	364
Trademarks		42		(1718	)		2524		42		(15	)		27
Other		7		(7	)		—		7		(7	)		—
Total finite-lived intangible assets	$	1,~~108~~109	$	(~~747~~763	)	$	~~361~~346	$	1,111	$	(720	)	$	391
Indefinite-lived intangible assets
Trademarks	$	554	$	—		$	554	$	554	$	—		$	554
Other		59		—			59		59		—			59
Total indefinite-lived intangible assets	$	613	$	—		$	613	$	613	$	—		$	613
Total intangible assets	$	1,~~721~~722	$	(~~747~~763	)	$	~~974~~959	$	1,724	$	(720	)	$	1,004

Amortization expense for intangible assets of $15 million and $3045 million for each of the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, respectively, was recognized in selling, general and administrative expenses.

Note 6. Accrued and Other Current Liabilities

Accrued and other current liabilities consisted of the following:

	As of		As of
	June 30, 2024		December 31, 2023
	September 30, 2024		December 31, 2023
Personnel costs	$	7693	$	134
Rebates and credits		6264		85
Restructuring costs(1)		2834		36
Interest		1740		17
Other(2)		~~138~~141		127
Accrued and other current liabilities	$	~~321~~372	$	399

(1)

Restructuring costs ~~relate~~related to the Beverage Merchandising Restructuring and the Footprint Optimization. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

(2)

Other included items such as freight, utilities and property and other non-income related taxes.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 7. Debt

Debt consisted of the following:

	As ofJune 30, 2024			As ofDecember 31, 2023
	As ofSeptember 30, 2024			As ofDecember 31, 2023
Credit Agreement:
U.S. Term Loans	$	1,~~327~~257		$	1,680
U.S. Revolving Loans		~~355~~330			—
Notes:
4.000% Senior Secured Notes due 2027		1,000			1,000
4.375% Senior Secured Notes due 2028		500			500
Pactiv Debentures:
7.950% Debentures due 2025		217			217
8.375% Debentures due 2027		167			167
Other		3836			41
Total principal amount of borrowings		3,~~604~~507			3,605
Deferred debt issuance costs (“DIC”)		(10	)		(11	)
Original issue discounts, net of premiums (“OID”)		(2	)		(8	)
		3,592			3,586
		3,495			3,586
Less: current portion		(206	)		(15	)
Long-term debt	$	3,~~572~~489		$	3,571

We were in compliance with all debt covenants during the ~~six~~nine months ended ~~June~~September 30, 2024 and the year ended December 31, 2023.

Credit Agreement

PTVE and certain of its U.S. subsidiaries are parties to a senior secured credit agreement dated August 5, 2016 as amended (the “Credit Agreement”). As of ~~June~~September 30, 2024, the Credit Agreement comprised the following term and revolving tranches:

	Maturity Date	Drawn		Applicable Interest Rate
Term Tranches
Term Tranche
U.S. Term Loans Tranche B-4	September 24, 2028	$	1,~~327~~257	SOFR (floor of 0.000%) + 2.500%
Revolving Tranche(1)
U.S. Revolving Loans	May 1, 2029	$	~~355~~330	SOFR (floor of 0.000%) + 2.500%

(1)

The Revolving Tranche represents a $1,100 million facility. In addition to the value drawn, the facility includes $4946 million utilized in the form of letters of credit.

We borrowed $391 million of our Revolving Tranche facility and repaid $3661 million plus interest during the first ~~half~~nine months of 2024. On October 31, 2024, we repaid an additional $70 million.

On May 1, 2024, we amended the Credit Agreement to increase the capacity on our Revolving Tranche facility from $250 million to $1,100 million and extend the maturity date to May 1, 2029. We also amended the applicable interest rate and other pricing terms, including by replacing the facility fee with a lower fee on unutilized capacity.

On May 28, 2024, we further amended the Credit Agreement to replace the existing $990 million outstanding U.S. term loans Tranche B-3 with a new upsized $1,330 million tranche of U.S. term loans Tranche B-4. The U.S. term loans Tranche B-4 will mature on September 24, 2028. The $340 million proceeds from upsizing the U.S. term loans, together with the proceeds of a $350 million draw upon our Revolving Tranche facility, were used to prepay in full the $690 million of existing U.S. term loans Tranche B-2 maturing in February 2026. The U.S. term loans Tranche B-4 have a lower interest rate relative to the U.S. term loans Tranche B-2 and B-3 that they replaced. There were no other material changes to the terms of the Credit Agreement as a result of these amendments.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

~~The~~On ~~weighted~~September ~~average contractual interest rates related to our U.S. term loans Tranche B-2, B-3 and B-4 for the six months ended June~~ 30, 2024, ~~were~~we ~~8.70%,~~repaid 8.$70% ~~and~~million ~~7.88%,~~of ~~respectively. The weighted average contractual interest rates related to our~~ U.S. term loans Tranche B-24, ~~and~~of ~~B-3~~which ~~for~~$67 ~~the~~million ~~six~~was ~~months~~considered ~~ended~~a ~~June 30, 2023 were 8~~prepayment.~~02%~~ ~~and~~As ~~8.05%,~~a ~~respectively.~~result ~~Including the impact~~ of ~~interest~~this ~~rate swap agreements~~prepayment, ~~which~~we ~~were~~have ~~entered~~no ~~into~~further inquarterly ~~the~~amortization ~~fourth~~payments ~~quarter~~under ~~of 2022,~~ the ~~weighted average rates on our~~ U.S. term loans ~~were 7~~.47% and 7.71% for the six months ended June 30, 2024 and June 30, 2023, respectively. The effective interest rates of our debt obligations under the Credit Agreement are not materially different from the contractual interest rates. Refer to Note 8, Financial Instruments, for additional details regarding the interest rate swap agreements.

~~PTVE~~The ~~and~~weighted ~~certain~~average ofcontractual ~~its~~interest rates related to our U.S. ~~subsidiaries~~term ~~have~~loans ~~guaranteed~~for onthe anine ~~senior~~months ~~basis~~ended September 30, 2024 and 2023 were 8.27% and 8.21%, respectively. Including the ~~obligations~~impact ~~under~~of interest rate swap agreements, which were entered into in the ~~Credit~~fourth ~~Agreement~~quarter toof 2022, the ~~extent~~weighted ~~permitted~~average byrates ~~law~~on our U.S. ~~The~~term ~~borrowers~~loans were 7.27% and 7.77% for the ~~guarantors~~nine ~~have~~months ~~granted~~ended ~~security~~September ~~over~~30, ~~substantially~~2024 ~~all~~and ofSeptember ~~their~~30, ~~assets~~2023, torespectively. ~~support~~The ~~the~~effective interest rates of our debt obligations under the Credit Agreement. ~~This~~are ~~security~~not ismaterially ~~expected~~different from the contractual interest rates. Refer to beNote ~~shared~~8, onFinancial aInstruments, ~~first~~for ~~priority~~additional ~~basis~~details ~~with~~regarding the ~~holders~~interest ofrate ~~the~~swap ~~Notes~~agreements.

~~Indebtedness~~PTVE ~~under~~and ~~the~~certain ~~Credit~~of ~~Agreement~~its ~~may~~U.S. besubsidiaries ~~voluntarily~~have ~~repaid,~~guaranteed inon ~~whole~~a orsenior inbasis ~~part,~~the ~~and~~obligations ~~must~~under bethe ~~mandatorily~~Credit ~~repaid~~Agreement ~~in certain circumstances. We are required~~ to ~~make quarterly amortization payments of 0.25% of~~ the ~~initial~~extent ~~principal~~permitted ~~amount~~by ~~of our U~~law.S. ~~term~~The ~~loans~~borrowers ~~Tranche~~and ~~B-4.~~the ~~Additionally,~~guarantors wehave ~~are~~granted ~~required~~security toover ~~make~~substantially ~~annual~~all ~~prepayments~~ of ~~term~~their ~~loans~~assets ~~with~~to upsupport tothe ~~50%~~obligations ofunder ~~excess~~the ~~cash~~Credit ~~flow~~Agreement. ~~(which~~This ~~will~~security beis ~~reduced~~expected to ~~25%~~be orshared 0%on ifa ~~specified senior secured~~ first ~~lien~~priority ~~leverage~~basis ~~ratios are met) as determined in accordance~~ with the ~~Credit~~holders ~~Agreement.~~of ~~No excess cash flow prepayments were due for~~ the ~~year~~Notes ~~ended~~(as ~~December~~defined ~~31, 2023~~below).

~~The~~Indebtedness under the Credit Agreement ~~contains~~may ~~customary~~be ~~covenants~~voluntarily ~~which~~repaid, ~~restrict~~in uswhole ~~from~~or in part, and must be mandatorily repaid in certain ~~activities~~circumstances. ~~including,~~We ~~among~~are ~~others,~~required ~~incurring~~to ~~debt,~~make ~~creating~~annual ~~liens~~prepayments ~~over~~of ~~assets,~~term ~~selling~~loans ~~assets~~with ~~and~~up ~~making~~to ~~restricted~~50% ~~payments,~~of inexcess ~~each~~cash ~~case~~flow ~~except~~(which will be reduced to 25% or 0% if specified senior secured first lien leverage ratios are met) as ~~permitted~~determined ~~under~~in accordance with the Credit Agreement. No excess cash flow prepayments were due for the year ended December 31, 2023.

The Credit Agreement contains customary covenants restricting us from undertaking certain activities including, among others, incurring debt, creating liens over assets, selling assets and making restricted payments, in each case except as permitted under the Credit Agreement.

Notes

As of ~~June~~September 30, 2024, our outstanding notes were as follows:


	Maturity Date	Interest Payment Dates
4.000% Senior Secured Notes due 2027	October 15, 2027	April 15 and October 15
4.375% Senior Secured Notes due 2028	October 15, 2028	April 15 and October 15

The effective interest rates of our debt obligations under the Notes are not materially different from the contractual interest rates.

PTVE and certain of its U.S. subsidiaries have guaranteed on a senior basis the obligations under the Notes ~~(as defined below)~~ to the extent permitted by law. The issuers and the guarantors have granted security over substantially all of their assets to support the obligations under the Notes. This security is expected to be shared on a first priority basis with the creditors under the Credit Agreement.

The respective indentures governing the 4.000% Senior Secured Notes due 2027 (the “4.000% Notes”) and the 4.375% Senior Secured Notes due 2028 (together with the 4.000% Notes, the “Notes”) contain customary covenants ~~which~~restricting ~~restrict~~ us from undertaking certain activities including, among others, incurring debt, creating liens over assets, selling assets and making restricted payments, in each case except as permitted under the respective indentures governing the Notes.

Under the respective indentures governing the Notes, we can, at our option, elect to redeem the Notes under terms and conditions specified in the indentures~~. Under the respective indentures governing the Notes~~, and in certain circumstances ~~which~~that would constitute a change in control, the holders of the Notes have the right to require us to repurchase the Notes at a premium.

Pactiv Debentures

As of ~~June~~September 30, 2024, ~~our~~Pactiv LLC, an indirect subsidiary of PTVE, had the following outstanding debentures (together, the “Pactiv Debentures”) ~~were as follows~~:


	Maturity Date	Interest Payment Dates
7.950% Debentures due 2025	December 15, 2025	June 15 and December 15
8.375% Debentures due 2027	April 15, 2027	April 15 and October 15

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

The effective interest rates of our debt obligations under the Pactiv Debentures are not materially different from the contractual interest rates.

The Pactiv Debentures are not guaranteed and are unsecured.

The indentures governing the Pactiv Debentures contain a negative pledge clause limiting the ability of ~~certain~~Pactiv ~~of our entities~~LLC, subject to certain exceptions, to (i) incur or guarantee debt that is secured by liens on “principal manufacturing properties” (as such term is defined in the indentures governing the Pactiv Debentures) or on the capital stock or debt of ~~certain~~Pactiv ~~subsidiaries~~LLC ~~that own or lease any such principal manufacturing property~~ and (ii) sell and then take an immediate lease back of such principal manufacturing property.

The 8.375% Debentures due 2027 may be redeemed at any time at our option, in whole or in part, at a redemption price equal to 100% of the principal amount thereof plus a make-whole premium, if any, plus accrued and unpaid interest to the date of the redemption.

Other borrowings

Other borrowings represented finance lease obligations of $3836 million and $41 million as of ~~June~~September 30, 2024 and December 31, 2023, respectively.

Scheduled maturities

Below is a schedule of required future repayments on our debt outstanding as of ~~June~~September 30, 2024:

2024	$	101
2025		~~236~~223
2026		196
2027		1,~~187~~173
2028		1,~~786~~763
Thereafter		~~366~~341
Total principal amount of borrowings	$	3,~~604~~507

Fair value of our long-term debt

The fair value of our long-term debt as of ~~June~~September 30, 2024 and December 31, 2023 is a Level 2 fair value measurement. Below is a schedule of carrying values and fair values of our debt outstanding:

	As of June 30, 2024				As of December 31, 2023
	As of September 30, 2024				As of December 31, 2023
	Carrying Value		Fair Value		Carrying Value		Fair Value
Credit Agreement
U.S. Term Loans	$	1,~~325~~255	$	1,~~331~~259	$	1,672	$	1,687
U.S. Revolving Loans		~~355~~330		~~355~~330		—		—
Notes:
4.000% Senior Secured Notes due 2027		995		~~938~~963		995		942
4.375% Senior Secured Notes due 2028		497		~~468~~480		496		471
Pactiv Debentures:
7.950% Debentures due 2025		216		~~223~~224		216		221
8.375% Debentures due 2027		166		~~175~~178		166		172
Other		3836		3836		41		41
Total	$	3,~~592~~495	$	3,~~528~~470	$	3,586	$	3,534

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Interest expense, net

Interest expense, net consisted of the following:

	For the Three Months Ended						For the ~~Six~~Nine Months Ended
	June 30,						June 30,
	September 30,						September 30,
	2024			2023			2024			2023
Interest expense:
Credit Agreement - Term Loans	$	3326		$	4341		$	7096		$	86127
Credit Agreement - Revolving Loans		37			—			310			—
Notes		1615			1615			3146			3146
Pactiv Debentures		8			8			1624			1624
Interest income		(1	)		(3	)		(23	)		(710	)
Amortization of DIC and OID		21			1			34			23
Loss on extinguishment of debt(1)		6—			—			6			—
Realized derivative gains		(3	)		(23	)		(69	)		(36	)
Other		23			12			47			24
Interest expense, net	$	6656		$	6461		$	~~125~~181		$	~~127~~188

(1)

The loss on extinguishment of debt represented the write-off of unamortized DIC and OID as a result of the Credit Agreement amendment on May 28, 2024.

Note 8. Financial Instruments

We had the following derivative instruments recorded at fair value in our condensed consolidated balance sheets:

	As of June 30, 2024					As of December 31, 2023
	As of September 30, 2024					As of December 31, 2023
	AssetDerivatives		LiabilityDerivatives			AssetDerivatives		LiabilityDerivatives
Commodity swap contracts	$	—	$	(32	)	$	—	$	(6	)
Foreign exchange derivatives		1		—			—		—
Interest rate derivatives		81		—(5	)		6		(6	)
Total fair value	$	92	$	(37	)	$	6	$	(12	)
Classification:
Other current assets	$	92	$	—		$	6	$	—
Accrued and other current liabilities		—		(26	)		—		(5	)
Other noncurrent liabilities		—		(1	)		—		(7	)
Total fair value	$	92	$	(37	)	$	6	$	(12	)

Our derivatives are comprised of commodity and interest rate swaps and foreign currency exchange forward contracts. All derivatives represent Level 2 financial assets and liabilities. Our derivatives are valued using an income approach based on the observable market index prices less the contract rate multiplied by the notional amount or based on pricing models that rely on market observable inputs such as commodity prices, interest rates and foreign currency exchange rates. Our calculation of the fair value of these financial instruments takes into consideration the risk of non-performance, including counterparty credit risk. The majority of our derivative contracts do not have a legal right of set-off. We manage the credit risk in connection with our derivatives by limiting the amount of exposure with each counterparty and monitoring the financial condition of our counterparties.

During the first quarter of 2024, we began entering into foreign currency exchange forward contracts to reduce our risk from exchange rate fluctuations associated with purchases denominated in a foreign currency. We are exposed to market risk for changes in foreign currency exchange rates due to the global nature of our operations and certain commodity risks. In order to manage these risks, we hedge portions of our forecasted purchases expected to occur within the next twelve months that are denominated in non-functional currencies, with foreign currency forward contracts designated as cash flow hedges. As of ~~June~~September 30, 2024, we had contracts with U.S. dollar equivalent notional amounts of $168 million to exchange the Mexican peso. We believe it is probable that all forecasted cash flow transactions will occur.

During the fourth quarter of 2022, we entered into derivative financial instruments with several large financial institutions which swapped the LIBO rate for a weighted average fixed rate of 4.120% for an aggregate notional amount of $1,000

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

million to hedge a portion of the interest rate exposure resulting from our U.S. term loans. These instruments are classified as cash flow hedges and mature in October 2025. In April 2023, we amended our interest rate swap agreements to replace the interest rate benchmark from LIBOR to SOFR, effective for swap payments for the period commencing April 28, 2023. Other than the foregoing, the material terms of the interest rate swap agreements remain unchanged, including the weighted average fixed rate of 4.120%, and our election to use certain practical expedients under Accounting Standards Codification Topic 848: Reference Rate Reform resulted in no material impacts on our condensed consolidated financial statements.

During the ~~three~~nine ~~and six~~ months ended ~~June~~September 30, 2024, we recognized an unrealized ~~gains~~gain of $~~2 million and $~~1 million within other comprehensive ~~income~~ (loss) income for our foreign currency exchange forward contracts. There was no unrealized gain or loss during the three months ended September 30, 2024. As of ~~June~~September 30, 2024, we expected to reclassify $1 million of gains, net of tax, from accumulated other comprehensive ~~income~~ (loss) income (“AOCL”) to earnings over the next twelve months. The actual amount that will be reclassified to future earnings may vary from this amount as a result of changes in market conditions.

During the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, we recognized realized gains of $3 million, $69 million, $23 million and $36 million, respectively, within interest expense, net and an unrealized ~~gains~~loss of $39 million, an unrealized gain of $145 million, an unrealized gain of $218 million and an unrealized gain of $1422 million, respectively, within other comprehensive ~~income~~ (loss) income for our interest rate derivatives. As of ~~June~~September 30, 2024, we expected to reclassify $63 million of ~~gains~~losses, net of tax, from AOCL to earnings over the next twelve months. The actual amount that will be reclassified to future earnings may vary from this amount as a result of changes in market conditions.

During the three and ~~six~~nine months ended ~~June~~September 30, 2024 ~~and 2023~~, we recognized an unrealized ~~gain~~gains of $1 million and $3 million, anrespectively, ~~unrealized~~in ~~gain~~cost of ~~$2 million~~sales, anfor ~~unrealized~~our ~~gain~~commodity ofswap $1contracts. ~~million~~During ~~and~~the three months ended September 30, 2023, we recognized an unrealized ~~loss~~gain of $1 million, ~~respectively,~~ in cost of sales, for our commodity swap contracts. There was no unrealized gain or loss during the nine months ended September 30, 2023.

The following table provides the detail of outstanding commodity derivative contracts as of ~~June~~September 30, 2024:

Type		Unit of Measure		ContractedVolume				ContractedPrice Range		Contracted Date ofMaturity
Natural gas swaps		Million BTU			1,~~870~~530,000			$4.63 - $5.37		~~Aug~~Oct 2024 - Dec 2025

Note 9. Employee Benefits

Net periodic benefit income (expense) for our defined benefit pension plans and other post-employment benefit plans consisted of the following:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2024			2023			2024			2023
Service cost	$	—		$	(1—	)	$	—		$	(1	)
Interest cost		(1312	)		(1213	)		(2537	)		(2538	)
Expected return on plan assets		12			910			2335			2030
Amortization of actuarial gains		1			—1			23			12
Total net periodic benefit cost	$	—		$	(4	)	$	—		$	(5	)
Total net periodic benefit income (cost)	$	1		$	(2	)	$	1		$	(7	)

The service cost components of net periodic benefit expense were recognized in cost of sales and the other components were recognized in non-operating expense, net in the condensed consolidated statements of ~~income~~ (loss) income.

Contributions to the Pension Plan for Pactiv Evergreen (“PPPE”) during the year ending December 31, 2024 are expected to be less than $1 million.

On November 1, 2024, using PPPE assets, we completed substantially all of the buy-out of $93 million of the PPPE’s projected benefit obligations. Approximately 2,000 of the PPPE’s approximately 18,000 total participants accepted the buyout, which was offered to term vested participants.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 10. Other Income (Expense), Net

Other income (expense), net consisted of the following:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2024			2023			2024		2023
Loss on sale of businesses and noncurrent assets	$	(1—	)	$	(1—	)	$	—	$	(1	)
Other		32			5(3	)		57		52
Other income, net	$	2		$	4		$	5	$	4
Other income (expense), net	$	2		$	(3	)	$	7	$	1

Note 11. Commitments and Contingencies

We are from time to time party to litigation, legal proceedings and tax examinations arising from our operations. Most of these matters involve allegations of damages against us relating to employment matters, personal injury and commercial or contractual disputes. We are also involved in various administrative and other proceedings relating to environmental matters that arise in the normal course of business, and we may become involved in similar matters in the future. We record estimates for claims and proceedings that constitute a present obligation when it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of such obligation can be made. While it is not possible to predict the outcome of any of these matters, based on our assessment of the facts and circumstances, we do not believe any of these matters, individually or in the aggregate, will have a material adverse effect on our balance sheet, results of operations or cash flows. However, actual outcomes may differ from those expected and could have a material effect on our balance sheet, results of operations or cash flows in a future period. Except for amounts provided, there were no legal proceedings pending other than those for which we have determined that the possibility of a material outflow is remote.

Indemnities

As part of the agreements for the sale of various businesses, we have provided certain warranties and indemnities to the respective purchasers as set out in the respective sale agreements. These warranties and indemnities are subject to various terms and conditions affecting the duration and total amount of the indemnities. Any claims pursuant to these warranties and indemnities, if successful, could have a material effect on our balance sheet, results of operations or cash flows.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 12. Accumulated Other Comprehensive Loss

The following table summarizes the changes in our balances of each component of AOCL:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2024			2023			2024			2023
Currency translation adjustments:
Balance as of beginning of period	$	(~~162~~181	)	$	(~~175~~165	)	$	(163	)	$	(189	)
Currency translation adjustments		(1912	)		10(5	)		(1830	)		2419
Other comprehensive (loss) income		(1912	)		10(5	)		(1830	)		2419
Balance as of end of period	$	(~~181~~193	)	$	(~~165~~170	)	$	(~~181~~193	)	$	(~~165~~170	)
Defined benefit plans:
Balance as of beginning of period	$	~~126~~125		$	87		$	127		$	88
Gain reclassified from AOCL:
Amortization of experience gains		(1	)		—(1	)		(23	)		(12	)
Other comprehensive loss		(1	)		—(1	)		(23	)		(12	)
Balance as of end of period	$	~~125~~124		$	8786		$	~~125~~124		$	8786
Foreign exchange derivatives:
Balance as of beginning of period	$	(1	)	$	—		$	—		$	—
Net derivative gain		2—			—			1			—
Other comprehensive income		2—			—			1			—
Balance as of end of period	$	1		$	—		$	1		$	—
Interest rate derivatives:
Balance as of beginning of period	$	5		$	(7	)	$	(1	)	$	(1	)
Net derivative gain		3			21			14			14
Net derivative (loss) gain		(9	)		8			5			22
Deferred tax expense on net derivative gain		(1	)		(6	)		(4	)		(4	)
Deferred tax benefit (expense) on net derivative (loss) gain		2			(2	)		(2	)		(6	)
Gain reclassified from AOCL		(3	)		(23	)		(69	)		(36	)
Deferred tax expense on reclassification(1)		1			1			23			12
Other comprehensive income		—			14			6			8
Other comprehensive (loss) income		(9	)		4			(3	)		12
Balance as of end of period	$	5(4	)	$	711		$	5(4	)	$	711
AOCL
Balance as of beginning of period	$	(3250	)	$	(9571	)	$	(37	)	$	(102	)
Other comprehensive (loss) income		(1822	)		24(2	)		(1335	)		3129
Balance as of end of period	$	(5072	)	$	(7173	)	$	(5072	)	$	(7173	)

(1)

Taxes reclassified to income are recorded in income tax benefit (expense) ~~benefit~~.

Note 13. Income Taxes

The effective tax rates for the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023 represent our estimate of the annual effective tax rates expected to be applicable for the respective full fiscal years, adjusted for any discrete events which are recorded in the period that they occur.

During the three months ended ~~June~~September 30, 2024, we recognized a tax ~~expense~~benefit of $1138 million on ~~income~~a loss before tax of $31251 million. During the ~~six~~nine months ended ~~June~~September 30, 2024, we recognized a tax ~~expense~~benefit of $1622 million on ~~income~~a loss before tax of $46205 million.

During the three months ended ~~June~~September 30, 2023, we recognized a tax ~~benefit~~expense of $822 million on ~~loss~~income from continuing operations before tax of $~~147~~50 million. During the ~~six~~nine months ended ~~June~~September 30, 2023, we recognized a tax benefit of $275 million on a loss from continuing operations before tax of $~~299~~249 million.

The effective tax rates for the aforementioned periods were driven primarily by the inability to recognize a tax benefit on all interest expense.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

We are under audit by the Internal Revenue Service (“IRS”) and other taxing authorities. The IRS is currently auditing our U.S. income tax returns for 2016-2017. As of ~~June~~September 30, 2024, we have not received any proposed adjustments from taxing authorities that would be material. Although the ultimate timing is uncertain, it is reasonably possible that a reduction of up to $9 million of unrecognized tax benefits could occur within the next twelve months due to changes in audit status, settlements of tax assessments and other events.

Note 14. Related Party Transactions

As of ~~June~~September 30, 2024, approximately 77% of our shares were owned by PFL.

Transactions with our related parties are detailed below. All of our related parties are commonly controlled by Mr. Graeme Hart, our controlling shareholder, except for our joint ventures.

	Income (expense) for the Three Months Ended June 30,						Income (expense) for the Six Months Ended June 30,						Balance Outstanding as of
	Income (expense) for the Three Months Ended September 30,						Income (expense) for the Nine Months Ended September 30,						Balance Outstanding as of
	2024			2023			2024			2023			~~June~~September 30, 2024			December 31, 2023
Joint ventures
Included in other current assets													$	1		$	1
Sale of goods and services(1)	$	—		$	21		$	—		$	45
Other common controlled entities
Related party receivables														3728			35
Sale of goods and services(2)		83			9392			~~163~~246			~~199~~291
Rental income and transition services agreements(2)		21			—3			34			14
Charges(3)		41			41			56			45
Related party payables														(7	)		(7	)
Purchase of goods(2)(4)		(1618	)		(1021	)		(3856	)		(3758	)
Charges(3)		(74	)		(43	)		(1014	)		(710	)

(1)

All transactions with joint ventures are settled in cash. Sales of goods and services are negotiated based on market rates. All amounts are unsecured, non-interest bearing and settled on normal trade terms.

(2)

We sell and purchase various goods and services with Reynolds Consumer Products Inc. (“RCPI”) under contractual arrangements that expire over a variety of periods through December 31, 2027.

We also lease a portion of two facilities to RCPI and are party to an information technology services agreement with RCPI. We do not trade with Graham Packaging Company Inc. (“GPCI”) on an ongoing basis.

(3)

These charges are for various costs incurred including services provided under a transition services agreement, an insurance sharing agreement and an investment advisory agreement with Rank Group Limited (“Rank”). All amounts are unsecured, non-interest bearing and settled on normal trade terms.

(4)

Related party purchases are initially recorded as inventories and subsequently recorded to cost of sales utilizing the first-in, first-out method.

Note 15. Equity Based Compensation

WeThe ~~established the~~ Pactiv Evergreen Inc. Amended and Restated Equity Incentive Plan ~~for~~enables ~~purposes~~us ofto ~~granting~~grant stock or other equity based compensation awards to our employees (including our senior management), directors, ~~consultants~~ and ~~advisors~~consultants.

Equity based compensation costs were $6 million, $1319 million, $109 million and $1524 million for the three and ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, respectively, substantially all of which was recognized in selling, general and administrative expenses.

Restricted Stock Units

During the ~~six~~nine months ended ~~June~~September 30, 2024, we granted restricted stock units (“RSUs”) to certain members of management and certain members of our Board of Directors. These RSUs require future service to be provided and generally vest in annual installments over a period of three years beginning on the first anniversary of the grant date. During the vesting period, the RSUs carry dividend-equivalent rights, but the RSUs do not have voting rights. The RSUs and any related dividend-equivalent rights are forfeited inif the ~~event the~~ holder is no longer ana ~~employee~~service provider on the vesting date,

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

~~date,~~ unless the holder satisfies certain retirement-eligibility criteria. The following table summarizes RSU activity during the ~~six~~nine months ended ~~June~~September 30, 2024:

(In thousands, except per share amounts)	Number of RSUs			WeightedAverageGrant DateFair Value
Non-vested, at January 1		2,707		$	10.06
Granted(1)		1,~~658~~674			12.9694
Forfeited		(76156	)		11.7691
Vested		(1,~~014~~100	)		11.4599
Non-vested, at June 30		3,275		$	11.06
Non-vested, at September 30		3,125		$	10.83

(1)

Included 5772 thousand shares reserved for issuance upon the settlement of dividend-equivalent rights carried by the reported RSUs concurrently with the settlement of such RSUs for shares.

Unrecognized compensation cost related to unvested RSUs as of ~~June~~September 30, 2024 was $1812 million, which is expected to be recognized over a weighted average period of 2.1 years. The total vest date fair value of shares that vested during the ~~six~~nine months ended ~~June~~September 30, 2024 was $1213 million.

Performance Share Units

During the ~~six~~nine months ended ~~June~~September 30, 2024, we granted performance share units (“PSUs”), ~~to certain members of management~~ which vest on the third anniversary of the grant date, to certain members of management. Based on the achievement of a company performance target during a performance period set by ~~our~~the Compensation Committee of our Board of Directors, upon vesting, the PSUs are exchanged for a number of shares of common stock equal to the number of PSUs multiplied by a factor between 0% and 200%. We use our stock price on the grant date to estimate the fair value of our PSUs. We adjust the expense based on the likelihood of future achievement of performance metrics. If ~~any~~the ofthreshold performance target associated with the ~~performance~~PSU ~~targets~~award ~~are~~is not achieved, the ~~awards~~award ~~are~~is forfeited. During the vesting period, the PSUs carry dividend-equivalent rights, but the PSUs do not have voting rights. The PSUs and any related dividend-equivalent rights are forfeited inif the ~~event the~~ holder is no longer ana ~~employee~~service provider on the vesting date, unless the holder satisfies certain retirement-eligibility criteria. The following table summarizes PSU activity during the ~~six~~nine months ended ~~June~~September 30, 2024:

(In thousands, except per share amounts)	Number of PSUs			WeightedAverageGrant DateFair Value
Non-vested, at January 1		2,846		$	9.52
Granted(1)		~~851~~915			12.9990
Forfeited		(~~319~~421	)		9.7759
Non-vested, at June 30		3,378		$	10.37
Non-vested, at September 30		3,340		$	10.44

(1)

Included 53117 thousand shares reserved for issuance upon the settlement of dividend-equivalent rights carried by the reported PSUs concurrently with the settlement of such PSUs for shares.

Unrecognized compensation cost related to unvested PSUs as of ~~June~~September 30, 2024 was $2014 million, which is expected to be recognized over a weighted average period of 1.98 years.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Note 16. Earnings Per Share

~~Earnings~~ (~~loss~~Loss) earnings per share, including a reconciliation of the number of shares used for our ~~earnings~~ (loss) earnings per share calculation, was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2024			2023			2024			2023
Numerator
Net earnings (loss) attributable to common shareholders	$	19		$	(139	)	$	28		$	(273	)
Net (loss) earnings attributable to common shareholders - continuing operations	$	(213	)	$	27		$	(185	)	$	(246	)
Less: dividend-equivalents declared for equity based awards		—			(1	)		(2	)		(2	)
Less: dividend-equivalents accrued on equity based awards		—			—			(2	)		(2	)
Total net earnings (loss) available to common shareholders	$	19		$	(140	)	$	26		$	(275	)
Net (loss) earnings available to common shareholders - continuing operations		(213	)		27			(187	)		(248	)
Net earnings attributable to common shareholders - discontinued operations		—			2			—			2
Total net (loss) earnings available to common shareholders	$	(213	)	$	29		$	(187	)	$	(246	)
Denominator
Weighted average number of shares outstanding - basic		179.79			178.57			179.56			178.45
Effect of dilutive securities		~~1.3~~—			—1.0			~~1.3~~—			—
Weighted average number of shares outstanding - diluted		~~181~~179.09			~~178~~179.57			~~180~~179.86			178.45
Earnings (loss) per share attributable to Pactiv Evergreen Inc. common shareholders
(Loss) earnings per share attributable to Pactiv Evergreen Inc. common shareholders
Basic	$	0.11		$	(0.78	)	$	0.14		$	(1.54	)
From continuing operations
Diluted	$	0.10		$	(0.78	)	$	0.14		$	(1.54	)
Basic	$	(1.18	)	$	0.15		$	(1.04	)	$	(1.39	)
Diluted	$	(1.18	)	$	0.15		$	(1.04	)	$	(1.39	)
From discontinued operations
Basic	$	—		$	0.01		$	—		$	0.01
Diluted	$	—		$	0.01		$	—		$	0.01
Total
Basic	$	(1.18	)	$	0.16		$	(1.04	)	$	(1.38	)
Diluted	$	(1.18	)	$	0.16		$	(1.04	)	$	(1.38	)

~~There~~The ~~were~~weighted noaverage number of anti-dilutive potential common shares excluded from the calculation above ~~during~~was 1.4 million and 1.3 million for the three and ~~six~~nine months ended ~~June~~September 30, 2024, respectively, and 0.8 ~~The~~million ~~weighted~~for ~~average~~the ~~number~~nine ofmonths ended September 30, 2023. There were no anti-dilutive potential common shares excluded from the calculation above ~~was~~during ~~0.6 million shares and 0.7 million shares for~~ the three ~~and six~~ months ended ~~June~~September 30, 2023~~, respectively~~.

On ~~July~~November 298, 2024, our Board of Directors declared a dividend of $0.10 per share to be paid on ~~September~~December 13, 2024 to shareholders of record as of ~~August~~December 302, 2024.

Note 17. Segment Information

As of ~~June~~September 30, 2024, we had two reportable segments: Foodservice and Food and Beverage Merchandising. These reportable segments reflect our operating structure and the manner in which our CODM, who is our President and Chief Executive Officer, assesses information for decision-making purposes. The key factors used to identify these reportable segments are the organization of our internal operations and the nature of our products. This reflects how our CODM monitors performance, allocates capital and makes strategic and operational decisions. Our reportable segments are described as follows:

Foodservice - Manufactures a broad range of products that enable consumers to eat and drink where they want and when they want with convenience. Foodservice manufactures food containers, drinkware (hot and cold cups and lids), tableware, serviceware and other products which make eating on-the-go more enjoyable and easy to do.

Food and Beverage Merchandising - Manufactures products that protect and attractively display food and beverages while preserving freshness. Food and Beverage Merchandising products include cartons for fresh refrigerated beverage products, primarily serving dairy (including plant-based, organic and specialties), juice and other specialty beverage end-markets, clear rigid-display containers, containers for prepared and ready-to-eat food, trays for meat and poultry and egg cartons. It also produces fiber-based liquid packaging board for its internal requirements and to sell to other fresh beverage carton manufacturers. Prior to June 2023, it also produced a range of paper-based products which it sold to paper and packaging converters.

Other/Unallocated - We previously had other operating segments that did not meet the threshold for presentation as a reportable segment. These operating segments comprised the remaining components of our former closures businesses, which generated revenue from the sale of caps and closures, and are presented as “Other”. As of March 31, 2023, we had disposed of all of the remaining components of our former closures

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

~~businesses~~Food and Beverage Merchandising - Manufactures products that protect and attractively display food and beverages while preserving freshness. ~~Unallocated~~Food ~~includes~~and ~~corporate~~Beverage ~~costs~~Merchandising products include cartons for fresh refrigerated beverage products, primarily ~~relating~~serving todairy ~~general~~(including plant-based, organic and ~~administrative~~specialties), ~~functions~~juice ~~such~~and asother ~~finance~~specialty beverage end-markets, ~~tax~~clear rigid-display containers, containers for prepared and ~~legal~~ready-to-eat food, trays for meat and ~~the~~poultry ~~effects~~and egg cartons. It also produces fiber-based liquid packaging board for its internal requirements and to sell to other fresh beverage carton manufacturers. Prior to June 2023, it also produced a range of ~~the~~paper-based ~~PPPE~~products which it sold to paper and packaging converters.

Information by Segment

We present reportable segment Adjusted EBITDA as this is the financial measure by which management and our CODM allocate resources and analyze the performance of our reportable segments.

A segment’s Adjusted EBITDA represents its earnings before interest, tax, depreciation and amortization and is further adjusted to exclude certain items, including but not limited to restructuring, asset impairment and other related charges, gains or losses on the sale of businesses and noncurrent assets, non-cash pension income or expense, unrealized gains or losses on derivatives, foreign exchange gains or losses on cash and gains or losses on certain legal settlements.

	Foodservice		Food and Beverage Merchandising		Reportable Segment Total
For the Three Months Ended June 30, 2024
For the Three Months Ended September 30, 2024
Net revenues	$	~~668~~670	$	~~670~~663	$	1,~~338~~333
Intersegment revenues		—		4		4
Total reportable segment net revenues	$	~~668~~670	$	~~674~~667	$	1,~~342~~337
Adjusted EBITDA	$	~~109~~120	$	93111	$	~~202~~231
For the Three Months Ended June 30, 2023
For the Three Months Ended September 30, 2023
Net revenues	$	~~656~~675	$	~~770~~704	$	1,~~426~~379
Intersegment revenues		—		358		358
Total reportable segment net revenues	$	~~656~~675	$	~~805~~712	$	1,~~461~~387
Adjusted EBITDA	$	~~128~~117	$	~~109~~130	$	~~237~~247
For the Six Months Ended June 30, 2024
For the Nine Months Ended September 30, 2024
Net revenues	$	1,~~265~~935	$	1,~~325~~988	$	23,~~590~~923
Intersegment revenues		—		913		913
Total reportable segment net revenues	$	1,~~265~~935	$	12,~~334~~001	$	23,~~599~~936
Adjusted EBITDA	$	~~199~~319	$	~~193~~304	$	~~392~~623
For the Six Months Ended June 30, 2023
For the Nine Months Ended September 30, 2023
Net revenues	$	1,~~270~~945	$	12,~~585~~289	$	24,~~855~~234
Intersegment revenues		—		7078		7078
Total reportable segment net revenues	$	1,~~270~~945	$	12,~~655~~367	$	24,~~925~~312
Adjusted EBITDA	$	~~234~~351	$	~~210~~340	$	~~444~~691

Reportable segment assets consisted of the following:

	Foodservice		Food and Beverage Merchandising		Reportable Segment Total
As of June 30, 2024	$	1,343	$	1,464	$	2,807
As of December 31, 2023		1,251		1,511		2,762

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

~~The~~Reportable ~~following~~segment ~~table~~assets ~~presents~~consisted ~~a reconciliation~~ of ~~reportable~~the ~~segment Adjusted EBITDA to consolidated income (loss) before income taxes~~following:

	For the Three Months Ended						For the Six Months Ended
	Foodservice			Food and Beverage Merchandising			Reportable Segment Total
	June 30,						June 30,
As of September 30, 2024	$	1,333		$	1,020		$	2,353
	2024			2023			2024			2023
As of December 31, 2023		1,251			1,511			2,762
Reportable segment Adjusted EBITDA	$	202		$	237		$	392		$	444
Unallocated		(19	)		(20	)		(41	)		(38	)
		183			217			351			406
Adjustments to reconcile to GAAP income (loss) before income taxes
Interest expense, net		(66	)		(64	)		(125	)		(127	)
Depreciation and amortization (excluding Beverage Merchandising Restructuring and Footprint Optimization related charges)		(75	)		(82	)		(150	)		(166	)
Beverage Merchandising Restructuring charges		(7	)		(216	)		(18	)		(403	)
Footprint Optimization charges		(3	)		—			(13	)		—
Other restructuring and asset impairment charges (reversals)		(2	)		(1	)		(2	)		—
Loss on sale of businesses and noncurrent assets		(1	)		(1	)		—			(1	)
Non-cash pension expense		—			(3	)		—			(4	)
Unrealized gains (losses) on commodity derivatives		1			1			2			(1	)
Foreign exchange gains (losses) on cash		1			2			1			(2	)
Other		—			—			—			(1	)
Income (loss) before tax	$	31		$	(147	)	$	46		$	(299	)

The following table presents a reconciliation of reportable segment Adjusted EBITDA to consolidated (loss) income from continuing operations before income taxes:


	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Reportable segment Adjusted EBITDA	$	231		$	247		$	623		$	691
Unallocated		(17	)		(20	)		(58	)		(58	)
		214			227			565			633
Adjustments to reconcile to GAAP (loss) income from continuing operations before income taxes
Interest expense, net		(56	)		(61	)		(181	)		(188	)
Depreciation and amortization (excluding Beverage Merchandising Restructuring and Footprint Optimization related charges)		(70	)		(81	)		(220	)		(247	)
Beverage Merchandising Restructuring charges		(336	)		(32	)		(354	)		(435	)
Footprint Optimization charges		(4	)		—			(17	)		—
Other restructuring and asset impairment charges		(2	)		—			(4	)		—
Loss on sale of businesses and noncurrent assets		—			—			—			(1	)
Non-cash pension income (expense)		1			(2	)		1			(6	)
Unrealized gains on commodity derivatives		1			1			3			—
Foreign exchange losses (gains) on cash		1			(2	)		2			(4	)
Other		—			—			—			(1	)
(Loss) income from continuing operations before tax	$	(251	)	$	50		$	(205	)	$	(249	)

The following table presents a reconciliation of reportable segment assets to consolidated assets:

	As ofJune 30, 2024		As ofDecember 31, 2023
	As ofSeptember 30, 2024		As ofDecember 31, 2023
Reportable segment assets(1)	$	2,~~807~~353	$	2,762
Unallocated(2)		3,~~555~~698		3,633
Total assets	$	6,~~362~~051	$	6,395

(1)

Reportable segment assets represent trade receivables, inventory and property, plant and equipment.

(2)

Unallocated is comprised of cash and cash equivalents, other current assets, assets held for sale, entity-wide property, plant and equipment, operating lease right-of-use assets, goodwill, intangible assets, related party receivables and other noncurrent assets.

Pactiv Evergreen Inc.

Notes to the Condensed Consolidated Financial Statements

(In millions, except per share data and unless otherwise indicated)

(Unaudited)

Information in Relation to Products

Net revenues by product line are as follows:

	For the Three Months Ended						For the ~~Six~~Nine Months Ended
	June 30,						June 30,
	September 30,						September 30,
	2024			2023			2024			2023
Foodservice
Drinkware	$	328		$	~~304~~324		$	~~588~~916		$	~~568~~892
Containers		~~234~~228			~~238~~233			~~459~~687			~~467~~700
Tableware		6369			6872			~~131~~200			~~143~~215
Serviceware and other		4345			46			87132			92138
Food and Beverage Merchandising
Cartons for fresh beverage products		~~170~~172			~~182~~177			~~354~~526			~~377~~554
Bakery/snack/produce/fruit containers		~~132~~119			~~139~~123			~~240~~359			~~266~~389
Meat trays		~~106~~107			~~109~~108			~~210~~317			~~215~~323
Tableware		92			103			~~184~~276			~~206~~309
Liquid packaging board		5469			~~121~~68			~~109~~178			~~249~~317
Egg cartons		3631			3233			74105			70103
Prepared food trays		29			3638			5685			72110
Paper products		—			27—			—			74
Other		5548			5662			~~107~~155			~~126~~188
Total reportable segment net revenues		1,~~342~~337			1,~~461~~387			23,~~599~~936			24,~~925~~312
Other / Unallocated
Other		—			—			—			2
Intersegment eliminations		(4	)		(358	)		(913	)		(7078	)
Total net revenues	$	1,~~338~~333		$	1,~~426~~379		$	23,~~590~~923		$	24,~~857~~236

For all product lines, there is a relatively short time period between the receipt of the order and the transfer of control over the goods to the customer.

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

Our discussion and analysis is intended to help the reader understand our results of operations and financial condition and is provided as an addition to, and should be read in connection with, our condensed consolidated financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q.

Our Company

We are a leading manufacturer and distributor of fresh foodservice and food merchandising products and fresh beverage cartons in North America. We produce a broad range of on-trend and feature-rich products that protect, package and display food and beverages for today’s consumers. Our products include containers, drinkware (such as hot and cold cups and lids), cartons for fresh refrigerated beverage products, tableware, meat and poultry trays, liquid packaging board, serviceware, prepared food trays and egg cartons. Our products, many of which are made with recycled, recyclable or renewable materials, are sold to a diversified mix of customers, including restaurants, foodservice distributors, retailers, food and beverage producers, packers and processors. Following authorization by our Board of Directors on July 12, 2024, we signed a definitive agreement to sell the facilities that manufacture liquid packaging board. The transaction closed on October 1, 2024. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Business Environment

InDuring ~~the second quarter of~~ 2024, we have experienced ~~further~~ moderation in demand for certain of our products, primarily driven by the ~~ongoing~~cumulative effect on consumer spending ~~from~~of sustained high levels of inflation in recent years. While we have not observed a material economic contraction to-date, wethis ~~expect~~dynamic ~~these~~may ~~pressures to~~ persist in the near-term, ~~impacting~~which could result in a continued impact on consumer demand and thus our customers’ purchasing decisions and order patterns ~~throughout the remainder of 2024~~.

In recent years, we experienced meaningful input cost inflation and challenging labor market conditions. While the rate of inflation has moderated, weover ~~expect~~the ~~continued~~past ~~upward~~year, ~~pressure~~we onmay ~~our~~continue ~~input~~to ~~costs~~see ~~along~~increased ~~with more~~ price sensitivity from our customers ~~through~~in the ~~remainder~~near ~~of the year~~term. WeHowever, we believe our pricing strategy provides us with flexibility to manage our market position through cost recovery mechanisms and strategic competitive pricing, among others. In this dynamic environment, we remain focused on servicing our customers, improving manufacturing productivity and optimizing costs across our business.

The increase in interest rates from historically low levels in recent years, higher levels of inflation and geopolitical factors continue to create uncertainty with respect to the economic outlook. If economic conditions were to deteriorate, a further decline in consumer spending may result, which could lead to a meaningful decline in demand for our products in the remainder of 2024 and beyond.

Recent Developments and Items Impacting Comparability

Beverage Merchandising Restructuring

On March 6, 2023, we announced the Beverage Merchandising Restructuring, a plan approved by our Board of Directors to take significant restructuring actions related to our Beverage Merchandising operations. We expect these actions to increase our production efficiency, streamline our management structure and reduce our ongoing capital expenditures and overhead costs.

As a component of the Beverage Merchandising Restructuring, we commenced a process to explore strategic alternatives for our Pine Bluff, Arkansas mill and Waynesville, North Carolina extrusion facility (the “Facilities”). Following authorization by our Board of Directors on July 12, 2024, we entered into a definitive agreement to sell those facilities and associated assets and liabilities to Suzano S.A. ~~for $110 million, subject to certain customary adjustments at closing such as working capital. We also agreed to enter into a long-term liquid packaging board supply arrangement with~~ (“Suzano”) ~~upon closing of~~ (the ~~transaction.~~“Mill ~~The transaction is expected to close in the fourth quarter of 2024~~Transaction”).

The ~~operations~~Mill ~~impacted~~Transaction byclosed on October 1, 2024. We received preliminary proceeds of $83 million, inclusive of the ~~Beverage~~$10 ~~Merchandising~~million ~~Restructuring~~exclusivity ~~did~~payment ~~not~~previously ~~qualify~~received during the second quarter of 2024 and the preliminary calculation of customary adjustments for ~~presentation~~closing amounts, such as ~~discontinued~~working ~~operations~~capital. The exclusivity payment was recorded in other accrued liabilities in the condensed consolidated balance sheet as of September 30, 2024. The proceeds received are subject to finalization of the aforementioned closing adjustments. We also entered into a long-term liquid packaging board supply arrangement with Suzano upon closing of the Mill Transaction.

Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Footprint Optimization

Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

27Non-GAAP Measures – Adjusted EBITDA from Continuing Operations

~~Non~~In addition to financial measures determined in accordance with GAAP, we make use of the non-GAAP ~~Measures~~financial –measure Adjusted EBITDA from continuing operations to evaluate and manage our business and to plan and make near-term and long-term operating and strategic decisions.

InAdjusted ~~addition~~EBITDA tofrom ~~financial~~continuing ~~measures~~operations ~~determined~~is defined as net (loss) income from continuing operations calculated in accordance with GAAP, weplus ~~make~~the ~~use~~sum of ~~the~~income ~~non-GAAP~~tax ~~financial~~expense, ~~measure~~net ~~Adjusted~~interest ~~EBITDA~~expense, todepreciation ~~evaluate~~and amortization and ~~manage~~further ~~our~~adjusted ~~business~~to ~~and~~exclude certain items, including but not limited to ~~plan~~restructuring, asset impairment and ~~make~~other ~~near-term~~related charges, gains or losses on the sale of businesses and ~~long~~noncurrent assets, non-~~term~~cash ~~operating~~pension income or expense, unrealized gains or losses on derivatives, foreign exchange gains or losses on cash and ~~strategic~~gains ~~decisions~~or losses on certain legal settlements.

We present Adjusted EBITDA isfrom ~~defined~~continuing asoperations ~~net~~because ~~income~~it ~~(loss)~~is ~~calculated~~a inkey ~~accordance~~measure ~~with~~used ~~GAAP,~~by ~~plus~~our ~~the~~management ~~sum~~team ofto ~~income~~evaluate ~~tax~~our ~~expense~~operating performance, ~~net~~generate ~~interest~~future ~~expense~~operating plans, ~~depreciation~~make ~~and~~strategic ~~amortization~~decisions and ~~further~~incentivize ~~adjusted~~and toreward ~~exclude~~our ~~certain~~employees. ~~items~~Accordingly, ~~including~~we ~~but~~believe ~~not~~that ~~limited~~Adjusted toEBITDA ~~restructuring,~~from ~~asset~~continuing ~~impairment~~operations provides useful information to investors and ~~other~~others ~~related~~in ~~charges,~~understanding ~~gains~~and orevaluating ~~losses~~our onoperating results in the ~~sale~~same ofmanner ~~businesses~~as our management team and ~~noncurrent~~Board ~~assets,~~of ~~non~~Directors. We also believe that using Adjusted EBITDA from continuing operations facilitates operating performance comparisons on a period-~~cash~~to-period ~~pension~~basis ~~income~~because orit ~~expense~~excludes variations primarily caused by changes in the items noted above. In addition, ~~unrealized~~our ~~gains~~CODM, orwho ~~losses~~is onour ~~derivatives~~President and Chief Executive Officer, ~~foreign~~uses ~~exchange~~Adjusted ~~gains~~EBITDA orfrom ~~losses~~continuing onoperations ~~cash~~of ~~and~~each ~~gains~~reportable orsegment ~~losses~~to onevaluate ~~certain~~the ~~legal~~operating ~~settlements~~performance of such segments.

WeOur ~~present~~use of Adjusted EBITDA ~~because~~from continuing operations has limitations as an analytical tool, and you should not consider it isin isolation or as a ~~key~~substitute ~~measure~~for ~~used~~analysis byof our ~~management~~results ~~team~~as toreported ~~evaluate~~under ~~our~~GAAP. ~~operating performance~~Instead, ~~generate~~you ~~future~~should ~~operating~~consider ~~plans~~it alongside other financial performance measures, ~~make~~including ~~strategic~~our ~~decisions~~net ~~and~~(loss) ~~incentivize~~income from continuing operations and ~~reward~~other ~~our~~GAAP ~~employees~~results. ~~Accordingly~~In addition, wein ~~believe~~evaluating ~~that~~ Adjusted EBITDA ~~provides~~from ~~useful~~continuing ~~information~~operations, toyou ~~investors~~should ~~and~~be ~~others~~aware that in ~~understanding~~the ~~and~~future ~~evaluating~~we ~~our~~will ~~operating~~incur ~~results~~expenses insuch as those that are the ~~same~~subject ~~manner~~of asadjustments ~~our~~made ~~management~~in ~~team~~deriving Adjusted EBITDA from continuing operations, and ~~Board~~you ofshould ~~Directors.~~not Weinfer ~~also~~from ~~believe~~our ~~that~~presentation ~~using~~of Adjusted EBITDA ~~facilitates~~from ~~operating~~continuing ~~performance~~operations ~~comparisons~~that onour afuture ~~period-to-period~~results ~~basis~~will ~~because~~not itbe ~~excludes~~affected ~~variations~~by ~~primarily~~these ~~caused~~expenses byor ~~changes~~any inunusual ~~the~~or ~~items~~non-recurring ~~noted above~~items. InThe ~~addition,~~following ~~our~~is ~~CODM,~~a ~~who~~reconciliation isof our ~~President~~net ~~and~~(loss) ~~Chief~~income ~~Executive~~from ~~Officer~~continuing operations, ~~uses~~the ~~Adjusted~~most ~~EBITDA~~directly ofcomparable ~~each~~GAAP ~~reportable~~financial ~~segment~~measure, to ~~evaluate~~Adjusted ~~the~~EBITDA ~~operating~~from ~~performance~~continuing operations for each of ~~such~~the ~~segments.~~periods indicated:

Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Instead, you should consider it alongside other financial performance measures, including our net income (loss) and other GAAP results. In addition, in evaluating Adjusted EBITDA, you should be aware that in the future we will incur expenses such as those that are the subject of adjustments made in deriving Adjusted EBITDA, and you should not infer from our presentation of Adjusted EBITDA that our future results will not be affected by these expenses or any unusual or non-recurring items. The following is a reconciliation of our net income (loss), the most directly comparable GAAP financial measure, to Adjusted EBITDA for each of the periods indicated:


	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
(In millions)	2024			2023			2024			2023
Net (loss) income from continuing operations (GAAP)	$	(213	)	$	28		$	(183	)	$	(244	)
Income tax (benefit) expense		(38	)		22			(22	)		(5	)
Interest expense, net		56			61			181			188
Depreciation and amortization (excluding Beverage Merchandising Restructuring and Footprint Optimization related charges)		70			81			220			247
Beverage Merchandising Restructuring charges(1)		336			32			354			435
Footprint Optimization charges(2)		4			—			17			—
Other restructuring and asset impairment charges(3)		2			—			4			—
Loss on sale of businesses and noncurrent assets		—			—			—			1
Non-cash pension (income) expense(4)		(1	)		2			(1	)		6
Unrealized gains on commodity derivatives		(1	)		(1	)		(3	)		—
Foreign exchange (gains) losses on cash		(1	)		2			(2	)		4
Other		—			—			—			1
Adjusted EBITDA from continuing operations (Non-GAAP)	$	214		$	227		$	565		$	633

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
(In millions)	2024			2023			2024			2023
Net income (loss) (GAAP)	$	20		$	(139	)	$	30		$	(272	)
Income tax expense (benefit)		11			(8	)		16			(27	)
Interest expense, net		66			64			125			127
Depreciation and amortization (excluding Beverage Merchandising Restructuring and Footprint Optimization related charges)		75			82			150			166
Beverage Merchandising Restructuring charges(1)		7			216			18			403
Footprint Optimization charges(2)		3			—			13			—
Other restructuring and asset impairment charges (reversals)(3)		2			1			2			—
Loss on sale of businesses and noncurrent assets		1			1			—			1
Non-cash pension expense(4)		—			3			—			4
Unrealized (gains) losses on commodity derivatives		(1	)		(1	)		(2	)		1
Foreign exchange (gains) losses on cash		(1	)		(2	)		(1	)		2
Other		—			—			—			1
Adjusted EBITDA (Non-GAAP)	$	183		$	217		$	351		$	406

Reflects charges related to the Beverage Merchandising Restructuring, including $3 million, $6 million, $177 million and $267 million of accelerated depreciation expense during the three and six months ended June 30, 2024 and 2023, respectively. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Reflects charges related to the Footprint Optimization, including $2 million and $3 million of accelerated depreciation expense during the three and six months ended June 30, 2024, respectively. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Reflects other restructuring and asset impairment charges (reversals) not related to the Beverage Merchandising Restructuring or the Footprint Optimization. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Reflects the non-cash pension expense related to our employee benefit plans. Refer to Note 9, Employee Benefits, for additional details.

(1)

Reflects charges related to the Beverage Merchandising Restructuring including $322 million of non-cash Mill Transaction impairment charges recorded during the three and nine months ended September 30, 2024. Also includes $3 million, $9 million, $4 million and $271 million of accelerated depreciation expense during the three and nine months ended September 30, 2024 and 2023, respectively. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

(2)

Reflects charges related to the Footprint Optimization, including $2 million and $5 million of accelerated depreciation expense during the three and nine months ended September 30, 2024, respectively. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

(3)

Reflects other restructuring and asset impairment charges not related to the Beverage Merchandising Restructuring or the Footprint Optimization. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

(4)

Reflects the non-cash pension (income) expense related to our employee benefit plans. Refer to Note 9, Employee Benefits, for additional details.

Results of Operations

Three Months Ended ~~June~~September 30, 2024 and 2023

Consolidated Results

	For the Three Months Ended June 30,
	For the Three Months Ended September 30,
(In millions, except for %)	2024			% of Revenue			2023			% of Revenue			Change			% Change
Net revenues	$	1,~~255~~250			94	%	$	1,~~331~~286			93	%	$	(7636	)		(63	)%
Related party net revenues		83			6	%		9593			7	%		(1210	)		(1311	)%
Total net revenues		1,~~338~~333			100	%		1,~~426~~379			100	%		(8846	)		(63	)%
Cost of sales		(1,~~115~~078	)		(8381	)%		(1,~~342~~098	)		(9480	)%		~~227~~20			172	%
Gross profit		~~223~~255			1719	%		84281			620	%		~~139~~(26	)		~~165~~(9	)%
Selling, general and administrative expenses		(~~122~~115	)		(9	)%		(~~136~~137	)		(10	)%		1422			1016	%
Restructuring, asset impairment and other related charges		(6338	)		—(25	)%		(3228	)		(2	)%		26(310	)	NM	81	%
Other income, net		2			—	%		4			—	%		(2	)		(50	)%
Other income (expense)		2			—	%		(3	)		—	%		5		NM
Operating income (loss)		97			7	%		(80	)		(6	)%		177		NM
Operating (loss) income from continuing operations		(196	)		(15	)%		113			8	%		(309	)	NM
Non-operating expense, net		—			—	%		(3	)		—	%		3		NM
Non-operating income (expense)		1			—	%		(2	)		—	%		3		NM
Interest expense, net		(6656	)		(54	)%		(6461	)		(4	)%		(25	)		(38	)%
Income (loss) before tax		31			2	%		(147	)		(10	)%		178		NM
(Loss) income from continuing operations before tax		(251	)		(19	)%		50			4	%		(301	)	NM
Income tax (expense) benefit		(11	)		(1	)%		8			1	%		(19	)	NM
Income tax benefit (expense)		38			3	%		(22	)		(2	)%		60		NM
Net income (loss)		20			1	%		(139	)		(10	)%		159		NM
(Loss) income from continuing operations		(213	)		(16	)%		28			2	%		(241	)	NM
Adjusted EBITDA(1)	$	183			14	%	$	217			15	%	$	(34	)		(16	)%
Income from discontinued operations, net of income taxes		—			—	%		2			—	%		(2	)	NM
Net (loss) income		(213	)		(16	)%		30			2	%		(243	)	NM
Adjusted EBITDA from continuing operations(1)	$	214			16	%	$	227			16	%	$	(13	)		(6	)%

NM indicates that the calculation is “not meaningful”.

(1)

Adjusted EBITDA from continuing operations is a non-GAAP measure. For details, refer to Non-GAAP Measures - Adjusted EBITDA from continuing operations, including a reconciliation between net ~~income~~ (loss) income from continuing operations and Adjusted EBITDA from continuing operations.

Components of Change in Reportable Segment Net Revenues

	Price/Mix			Volume			~~Mill Closure~~FX			Total
Total net revenues		—2	%		(35	)%		(3—	)%		(63	)%
By reportable segment:
Foodservice		21	%		—(2	)%		—	%		2(1	)%
Food and Beverage Merchandising		(13	)%		(58	)%		(101	)%		(166	)%

Total Net Revenues. Total net revenues for the three months ended ~~June~~September 30, 2024 decreased by $8846 million, or 63%, to $1,~~338~~333 million compared to the prior year period. The decrease was primarily due to ~~the closure of our Canton, North Carolina mill during the second quarter of 2023 and~~ lower sales volume., ~~Lower~~partially ~~sales~~offset ~~volume~~by favorable pricing in the ~~Food~~Foodservice ~~and Beverage Merchandising~~ segment, ~~was~~largely ~~mainly~~ due to ~~strategically~~the ~~exiting~~pass ~~certain~~through ~~business~~of ~~and~~higher ~~the~~material ~~market~~costs, ~~softening~~and ~~amid~~favorable ~~inflationary~~product ~~pressures.~~

Cost of Sales. Cost of sales for the three months ended June 30, 2024 decreased by $227 million, or 17%, to $1,115 million compared to the prior year period. The decrease was primarily due to lower charges related to the Beverage Merchandising Restructuring as well as the closure of our Canton, North Carolina mill and lower sales volume, partially offset by higher manufacturing and material costs.

Selling, General and Administrative Expenses. Selling, general and administrative expenses for the three months ended June 30, 2024 decreased by $14 million, or 10%, to $122 million compared to the prior year period. The decrease was primarily due to lower incentive based compensation costs.

Restructuring, Asset Impairment and Other Related Charges. Restructuring, asset impairment and other related charges for the three months ended June 30, 2024 decreased by $26 million, or 81%, to $6 million compared to the prior year period. The expense for both periods is primarily related to activities associated with the Beverage Merchandising Restructuring. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Other Income, Net. Other income, net, for the three months ended June 30, 2024 decreased by $2 million to $2 million compared to the prior year period. Refer to Note 10, Other Income, Net, for additional details.

~~Non-operating~~mix ~~Expense,~~in ~~Net~~the Food and Beverage Merchandising segment. ~~Non-operating~~Lower ~~expense,~~sales ~~net,~~volume ~~for~~was ~~the~~mostly ~~three~~due ~~months~~to ~~ended~~a ~~June~~focus ~~30,~~on ~~2023~~value ~~was~~over $4volume ~~million~~in ofthe ~~expense.~~Food ~~Refer~~and toBeverage ~~Note~~Merchandising 9,segment ~~Employee~~and ~~Benefits,~~the ~~for~~broader ~~additional~~demand ~~details~~environment.

~~Interest~~Cost ~~Expense,~~of ~~Net~~Sales. ~~Interest~~Cost ~~expense,~~of ~~net,~~sales for the three months ended ~~June~~September 30, 2024 ~~increased~~decreased by $220 million, or 32%, to $661,078 million, compared to the prior year period. The ~~increase~~decrease was ~~mostly~~primarily due to alower $6sales ~~million loss on extinguishment of debt~~volume, partially offset by ~~lower~~higher ~~interest~~manufacturing ~~expense due to a reduction in total debt outstanding compared to the prior period~~ and amaterial ~~lower interest rate on our floating rate debt as a result of our Credit Agreement amendments~~costs. ~~Refer to Note 7, Debt, for additional details.~~

~~Income~~Selling, ~~Tax~~General ~~(Expense)~~and ~~Benefit~~Administrative Expenses. ~~During~~Selling, general and administrative expenses for the three months ended ~~June~~September 30, 2024, wedecreased ~~recognized~~by ~~tax expense of~~ $1122 million, onor ~~income~~16%, ~~before~~to ~~tax of~~ $31115 million, compared to ~~a tax benefit of $8 million on a loss before tax of $147 million for~~ the prior year period. The ~~effective~~decrease ~~tax rate for both periods~~ was ~~driven~~ primarily bydue ~~the inability~~ to ~~recognize~~lower aincentive ~~tax~~based ~~benefit~~compensation ~~on all interest expense~~costs.

~~Net~~Restructuring, ~~Income~~Asset ~~(Loss)~~Impairment and Other Related Charges. ~~Net~~Restructuring, ~~income~~asset ~~(loss)~~impairment and other related charges for the three months ended ~~June~~September 30, 2024 ~~was~~increased ~~income~~by of $20310 million ~~compared~~ to ~~a loss of~~ $~~139~~338 million incompared to the prior year period. The ~~change~~expense infor ~~net~~both ~~income~~periods ~~included~~is ~~a $139 million increase in gross profit,~~ primarily ~~due~~related to ~~accelerated~~activities ~~depreciation~~associated ~~expense~~with ~~from~~ the Beverage Merchandising Restructuring ~~incurred in the prior year period~~, ~~partially~~with ~~offset by lower sales volume in~~ the current period ~~for~~including ~~the~~an ~~reasons~~impairment ~~discussed~~charge ~~above.~~of ~~The improved result also benefited from a~~ $26322 million ~~decrease~~related ~~in restructuring charges compared~~ to the ~~prior~~Mill ~~period~~Transaction. ~~primarily~~Refer ~~related~~ to ~~the~~Note ~~Beverage~~2, ~~Merchandising~~ Restructuring, ~~partially~~Asset ~~offset~~Impairment byand ~~the~~Other ~~discrete~~Related ~~tax~~Charges, ~~benefit~~for ~~incurred~~additional ~~in the prior period related to the aforementioned restructuring~~details.

~~Adjusted~~Other ~~EBITDA~~Income (Expense), Net. ~~Adjusted~~Other ~~EBITDA~~income, net, for the three months ended ~~June~~September 30, 2024 ~~decreased~~was by $342 million, orof ~~16%,~~income compared to $~~183~~3 million ~~compared~~of toexpense in the prior year period. ~~The~~Refer ~~decrease was primarily attributable~~ to ~~higher~~Note ~~manufacturing~~10, ~~costs~~Other ~~and~~Income, ~~lower sales volume~~Net, ~~partially~~for ~~offset~~additional ~~by lower incentive based compensation costs~~details.

Non-operating Income (Expense), Net. Non-operating income, net, for the three months ended September 30, 2024 was $1 million of income compared to $2 million of expense in the prior year period. Refer to Note 9, Employee Benefits, for additional details.

Interest Expense, Net. Interest expense, net, for the three months ended September 30, 2024 decreased by $5 million, or 8%, to $56 million, compared to the prior year period. The decrease was due to a reduction in total debt outstanding compared to the prior period and a lower interest rate on our floating rate debt as a result of our Credit Agreement amendments. Refer to Note 7, Debt, for additional details.

Income Tax Benefit (Expense). During the three months ended September 30, 2024, we recognized a tax benefit of $38 million on loss from continuing operations before tax of $251 million, compared to a tax expense of $22 million on income from continuing operations before tax of $50 million for the prior year period. The effective tax rate for both periods was driven primarily by the inability to recognize a tax benefit on all interest expense.

(Loss) Income from Continuing Operations. (Loss) income from continuing operations for the three months ended September 30, 2024 was a loss of $213 million compared to income of $28 million for the three months ended September 30, 2023. The change was primarily due to the $322 million Mill Transaction impairment charge. The change also reflects a $60 million decrease in tax expense primarily as a result of the aforementioned impairment charge.

Adjusted EBITDA from Continuing Operations. Adjusted EBITDA from continuing operations for the three months ended September 30, 2024 decreased by $13 million, or 6%, to $214 million compared to the prior year period. The decrease was primarily attributable to higher manufacturing costs and lower sales volume, partially offset by lower incentive based compensation costs, favorable product mix in the Food and Beverage Merchandising segment and favorable pricing, net of material costs passed through, in the Foodservice segment.

Segment Information

Foodservice

	For the Three Months Ended June 30,
	For the Three Months Ended September 30,
(In millions, except for %)	2024			2023			Change			Change %
Total segment net revenues	$	~~668~~670		$	~~656~~675		$	12(5	)		2(1	)%
Segment Adjusted EBITDA	$	~~109~~120		$	~~128~~117		$	~~(19~~3	)		~~(15~~3	)%
Segment Adjusted EBITDA margin(1)		1618	%		2017	%

(1)

For each segment, segment Adjusted EBITDA margin is calculated as segment Adjusted EBITDA divided by total segment net revenues.

Total Segment Net Revenues. Foodservice total segment net revenues for the three months ended ~~June~~September 30, 2024 ~~increased~~decreased by $125 million, or 21%, to $~~668~~670 million compared to the prior year period. The ~~increase~~decrease was mainly due to ~~higher~~lower ~~pricing,~~sales ~~largely due to the pass through of higher material costs~~volume, ~~partially offset by unfavorable product mix.~~

Adjusted EBITDA. Foodservice Adjusted EBITDA for the three months ended June 30, 2024 decreased by $19 million, or 15%, to $109 million compared to the prior year period. The decrease was primarily due to higher manufacturing costs and unfavorable product mix, partially offset by higher pricing, net of material costs passed through, and lower incentive based compensation costs.

Food and Beverage Merchandising

	For the Three Months Ended June 30,
(In millions, except for %)	2024			2023			Change			Change %
Total segment net revenues	$	674		$	805		$	(131	)		(16	)%
Segment Adjusted EBITDA	$	93		$	109		$	(16	)		(15	)%
Segment Adjusted EBITDA margin		14	%		14	%

Total Segment Net Revenues. Food and Beverage Merchandising total segment net revenues for the three months ended June 30, 2024 decreased by $131 million, or 16%, to $674 million compared to the prior year period. The decrease was primarily due to the closure of our Canton, North Carolina mill, and lower sales volume. Lower sales volume was due to strategically exiting certain business and the market softening amid inflationary pressures.

Adjusted EBITDA. Food and Beverage Merchandising Adjusted EBITDA for the three months ended June 30, 2024 decreased by $16 million, or 15%, to $93 million compared to the prior year period. The decrease is primarily attributable to higher manufacturing costs, lower sales volume and lower pricing, net of material costs passed through, partially offset by lower incentive based compensation costs.

~~Six~~partially ~~Months~~offset ~~Ended~~by ~~June~~favorable 30pricing, ~~2024~~largely ~~and~~due ~~2023~~to the pass through of higher material costs. Lower sales volume was largely due to the broader demand environment.

Adjusted EBITDA. Foodservice Adjusted EBITDA for the three months ended September 30, 2024 increased by $3 million, or 3%, to $120 million compared to the prior year period. The increase was primarily due to favorable pricing, net of material costs passed through, and lower incentive based compensation costs, partially offset by higher manufacturing costs.

Food and Beverage Merchandising


	For the Three Months Ended September 30,
(In millions, except for %)	2024			2023			Change			Change %
Total segment net revenues	$	667		$	712		$	(45	)		(6	)%
Segment Adjusted EBITDA	$	111		$	130		$	(19	)		(15	)%
Segment Adjusted EBITDA margin		17	%		18	%

Total Segment Net Revenues. Food and Beverage Merchandising total segment net revenues for the three months ended September 30, 2024 decreased by $45 million, or 6%, to $667 million compared to the prior year period. The decrease was primarily due to lower sales volume, partially offset by favorable product mix. Lower sales volume was due to a focus on value over volume and the broader demand environment.

Adjusted EBITDA. Food and Beverage Merchandising Adjusted EBITDA for the three months ended September 30, 2024 decreased by $19 million, or 15%, to $111 million compared to the prior year period. The decrease was primarily attributable to higher manufacturing costs and lower sales volume, partially offset by favorable product mix and lower incentive based compensation costs.

Nine Months Ended September 30, 2024 and 2023

Consolidated Results

	For the Six Months Ended June 30,
	For the Nine Months Ended September 30,
(In millions, except for %)	2024			% of Revenue			2023			% of Revenue			Change			% Change
Net revenues	$	23,~~427~~677			94	%	$	23,~~654~~940			93	%	$	(~~227~~263	)		(97	)%
Related party net revenues		~~163~~246			6	%		~~203~~296			7	%		(4050	)		(2017	)%
Total net revenues		23,~~590~~923			100	%		24,~~857~~236			100	%		(~~267~~313	)		(97	)%
Cost of sales		(23,~~146~~224	)		(8382	)%		(23,~~658~~756	)		(9389	)%		~~512~~532			1914	%
Gross profit		~~444~~699			1718	%		~~199~~480			711	%		~~245~~219			~~123~~46	%
Selling, general and administrative expenses		(~~255~~370	)		(109	)%		(~~266~~403	)		(910	)%		1133			48	%
Restructuring, asset impairment and other related charges		(23361	)		(19	)%		(~~105~~133	)		(43	)%		82(228	)		78(171	)%
Other income, net		57			—	%		41			—	%		16		NM	25	%
Operating income (loss)		171			7	%		(168	)		(6	)%		339		NM
Operating loss from continuing operations		(25	)		(1	)%		(55	)		(1	)%		30			(55	)%
Non-operating expense, net		—			—	%		(4	)		—	%		4		NM
Non-operating income (expense)		1			—	%		(6	)		—	%		7		NM
Interest expense, net		(~~125~~181	)		(5	)%		(~~127~~188	)		(4	)%		27			24	%
Income (loss) before tax		46			2	%		(299	)		(10	)%		345		NM
Loss from continuing operations before tax		(205	)		(5	)%		(249	)		(6	)%		44			(18	)%
Income tax (expense) benefit		(16	)		(1	)%		27			1	%		(43	)	NM
Income tax benefit		22			1	%		5			—	%		17		NM
Net income (loss)		30			1	%		(272	)		(10	)%		302		NM
Loss from continuing operations		(183	)		(5	)%		(244	)		(6	)%		61			25	%
Adjusted EBITDA(1)	$	351			14	%	$	406			14	%	$	(55	)		(14	)%
Income from discontinued operations, net of income taxes		—			—	%		2			—	%		(2	)	NM
Net loss		(183	)		(5	)%		(242	)		(6	)%		59			24	%
Adjusted EBITDA from continuing operations(1)	$	565			14	%	$	633			15	%	$	(68	)		(11	)%

NM indicates that the calculation is “not meaningful”.”

(1)

Components of Change in Reportable Segment Net Revenues

	Price/Mix			Volume			Mill Closure			Total
Total net revenues		(2	)%		(3	)%		(4	)%		(9	)%
By reportable segment:
Foodservice		—	%		—	%		—	%		—	%
Food and Beverage Merchandising		(3	)%		(5	)%		(11	)%		(19	)%

Total Net Revenues. Total net revenues for the six months ended June 30, 2024 decreased by $267 million, or 9%, to $2,590 million compared to the prior year period. The decrease was primarily due to the closure of our Canton, North Carolina mill during the second quarter of 2023, lower sales volume, unfavorable product mix and lower pricing due to the pass through of lower material costs.

Cost of Sales. Cost of sales for the six months ended June 30, 2024 decreased by $512 million, or 19%, to $2,146 million compared to the prior year period. The decrease was primarily due to lower charges related to the Beverage Merchandising Restructuring as well as the closure of our Canton, North Carolina mill and lower sales volume.

Selling, General and Administrative Expenses. Selling, general and administrative expenses for the six months ended June 30, 2024 decreased by $11 million, or 4%, to $255 million compared to the prior year period. The decrease was primarily due to lower incentive based compensation costs.

Restructuring, Asset Impairment and Other Related Charges. Restructuring, asset impairment and other related charges for the six months ended June 30, 2024 decreased by $82 million, or 78%, to $23 million compared to the prior year period. The expense in both periods is primarily related to activities associated with the Beverage Merchandising Restructuring. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Other Income, Net. Other income, net, for the six months ended June 30, 2024 increased by $1 million to $5 million compared to the prior year period. Refer to Note 10, Other Income, Net, for additional details.

Non-operating Expense, Net. Non-operating expense, net, for the six months ended June 30, 2023 was $5 million of expense. Refer to Note 9, Employee Benefits, for additional details.

~~Interest~~Components ~~Expense,~~of ~~Net.~~Change ~~Interest expense, net, for the six months ended June 30, 2024 decreased by $2 million, or 2%, to $125 million, compared to the prior year period. The decrease was primarily due to a reduction~~ in ~~total~~Reportable ~~debt~~Segment ~~outstanding~~Net as well as a lower interest rate on our floating rate debt as a result of our Credit Agreement amendments, partially offset by a $6 million loss on extinguishment of debt during the current period. Refer to Note 7, Debt, for additional details.Revenues

Income Tax (Expense) Benefit. During the six months ended June 30, 2024, we recognized tax expense of $16 million on income before tax of $46 million, compared to a tax benefit of $27 million on a loss before tax of $299 million for the prior year period. The effective tax rate for both periods was driven primarily by the inability to recognize a tax benefit on all interest expense.


	Price/Mix			Volume			Mill Closure			Total
Total net revenues		(1	)%		(3	)%		(3	)%		(7	)%
By reportable segment:
Foodservice		—	%		(1	)%		—	%		(1	)%
Food and Beverage Merchandising		(2	)%		(5	)%		(8	)%		(15	)%

Total Net ~~Income (Loss)~~Revenues. ~~Net~~Total ~~income~~net ~~(loss)~~revenues for the ~~six~~nine months ended ~~June~~September 30, 2024 ~~was~~decreased ~~income~~by of $30313 million, ~~compared~~or 7%, to ~~a loss of~~ $~~272~~3,923 million incompared to the prior year period. The ~~change~~decrease inwas ~~net income included a $245 million increase in gross profit,~~ primarily due to ~~accelerated~~the ~~depreciation~~closure ~~expense~~of ~~from~~our ~~the~~Canton, ~~Beverage~~North ~~Merchandising~~Carolina ~~Restructuring~~mill ~~incurred~~during in the ~~prior~~second ~~year~~quarter ~~period~~of 2023, ~~partially offset by~~ lower sales volume inand ~~the~~unfavorable ~~current~~product ~~period~~mix. ~~for~~Lower ~~the~~sales ~~reasons~~volume ~~discussed~~was ~~above.~~mainly ~~The~~due ~~improved~~to ~~result~~a ~~also~~focus ~~benefited~~on ~~from~~value aover ~~$82~~volume ~~million decrease~~ in ~~restructuring charges compared to~~ the ~~prior~~Food ~~period~~and ~~primarily related to the~~ Beverage Merchandising ~~Restructuring,~~segment ~~partially~~and ~~offset by~~ the ~~discrete~~broader ~~tax~~demand ~~benefit incurred in the prior period related to the aforementioned restructuring~~environment.

~~Adjusted~~Cost ~~EBITDA~~of Sales. ~~Adjusted~~Cost ~~EBITDA~~of sales for the ~~six~~nine months ended ~~June~~September 30, 2024 decreased by $55532 million, or 14%, to $~~351~~3,224 million compared to the prior year period. The decrease ~~reflects~~was ~~unfavorable~~primarily ~~product~~due ~~mix,~~to lower ~~sales~~charges ~~volume~~related ~~and~~to ~~higher~~the ~~manufacturing~~Beverage ~~costs,~~Merchandising ~~partially~~Restructuring ~~offset~~as bywell ~~higher~~as ~~pricing,~~the ~~net~~closure of ~~material~~our ~~costs~~Canton, ~~passed~~North ~~through,~~Carolina mill and lower ~~incentive~~sales ~~based compensation costs~~volume.

Selling, General and Administrative Expenses. Selling, general and administrative expenses for the nine months ended September 30, 2024 decreased by $33 million, or 8%, to $370 million compared to the prior year period. The decrease was primarily due to lower incentive based compensation costs.

Restructuring, Asset Impairment and Other Related Charges. Restructuring, asset impairment and other related charges for the nine months ended September 30, 2024 increased by $228 million to $361 million compared to the prior year period. The expense in both periods is primarily related to activities associated with the Beverage Merchandising Restructuring, with the current period including a $322 million impairment charge related to the Mill Transaction. Refer to Note 2, Restructuring, Asset Impairment and Other Related Charges, for additional details.

Other Income, Net. Other income, net, for the nine months ended September 30, 2024 increased by $6 million to $7 million compared to the prior year period. Refer to Note 10, Other Income, Net, for additional details.

Non-operating Income (Expense), Net. Non-operating expense, net, for the nine months ended September 30, 2024 was $1 million of income compared to $6 million of expense in the prior year period. Refer to Note 9, Employee Benefits, for additional details.

Interest Expense, Net. Interest expense, net, for the nine months ended September 30, 2024 decreased by $7 million, or 4%, to $181 million, compared to the prior year period. The decrease was primarily due to a reduction in total debt outstanding, partially offset by a $6 million loss on extinguishment of debt during the current period. Refer to Note 7, Debt, for additional details.

Income Tax Benefit. During the nine months ended September 30, 2024, we recognized a tax benefit of $22 million on loss from continuing operations before tax of $205 million, compared to a tax benefit of $5 million on a loss from continuing operations before tax of $249 million for the prior year period. The effective tax rate for both periods was driven primarily by the inability to recognize a tax benefit on all interest expense.

Loss from Continuing Operations. Loss from continuing operations for the nine months ended September 30, 2024 was $183 million compared to $244 million in the prior year period. The change included a $219 million increase in gross profit, primarily due to accelerated depreciation expense from the Beverage Merchandising Restructuring incurred in the prior year period, partially offset by lower sales volume in the current period for the reasons discussed above. The change also included a $322 million impairment charge due to the Mill Transaction, and a $33 million decrease in selling, general and administrative expenses, for the reasons discussed above.

Adjusted EBITDA from Continuing Operations. Adjusted EBITDA from continuing operations for the nine months ended September 30, 2024 decreased by $68 million, or 11%, to $565 million compared to the prior year period. The decrease reflects higher manufacturing costs, lower sales volume and unfavorable product mix in the Foodservice segment, partially offset by lower material costs in the Food and Beverage Merchandising segment and lower incentive based compensation costs.

Segment Information

Foodservice

	For the Six Months Ended June 30,
	For the Nine Months Ended September 30,
(In millions, except for %)	2024			2023			Change			Change %
Total segment net revenues	$	1,~~265~~935		$	1,~~270~~945		$	(510	)		—(1	)%
Segment Adjusted EBITDA	$	~~199~~319		$	~~234~~351		$	(3532	)		(159	)%
Segment Adjusted EBITDA margin		16	%		18	%

Total Segment Net Revenues. Foodservice total segment net revenues for the ~~six~~nine months ended ~~June~~September 30, 2024 decreased by $510 million to $1,~~265~~935 million compared to the prior year period. asThe ~~higher~~decrease was primarily due to unfavorable product mix and lower sales volume, partially offset by favorable pricing, largely due to the pass through of higher material costs~~, was more than offset by unfavorable product mix~~.

Adjusted EBITDA. Foodservice Adjusted EBITDA for the ~~six~~nine months ended ~~June~~September 30, 2024 decreased by $3532 million, or 159%, to $~~199~~319 million compared to the prior year period. The decrease iswas primarily due to higher manufacturing costs and unfavorable product mix, partially offset by ~~higher~~favorable pricing, net of material costs passed through.

Food and Beverage Merchandising

	For the Six Months Ended June 30,
	For the Nine Months Ended September 30,
(In millions, except for %)	2024			2023			Change			Change %
Total segment net revenues	$	12,~~334~~001		$	12,~~655~~367		$	(~~321~~366	)		(1915	)%
Segment Adjusted EBITDA	$	~~193~~304		$	~~210~~340		$	(1736	)		(811	)%
Segment Adjusted EBITDA margin		1415	%		1314	%

Total Segment Net Revenues. Food and Beverage Merchandising total segment net revenues for the ~~six~~nine months ended ~~June~~September 30, 2024 decreased by $~~321~~366 million, or 1915%, to $12,~~334~~001 million compared to the prior year period. The decrease was primarily due to the closure of our Canton, North Carolina mill, lower sales volume and ~~lower~~unfavorable pricing, ~~largely~~mostly due to the pass through of lower material costs.

Adjusted EBITDA. Food and Beverage Merchandising Adjusted EBITDA for the ~~six~~nine months ended ~~June~~September 30, 2024 decreased by $1736 million, or 811%, to $~~193~~304 million compared to the prior year period. The decrease reflects higher manufacturing costs, lower sales volume and unfavorable ~~product~~pricing, ~~mix~~net of material costs passed through, partially offset by lower ~~manufacturing and~~ incentive based compensation costs.

Liquidity and Capital Resources

We manage our capital structure in an effort to most effectively execute our strategic priorities and maximize shareholder value. We believe that we have sufficient liquidity to support our ongoing operations and to re-invest in our business to drive future growth. Our projected operating cash flows, cash on-hand and available capacity under our revolving credit facility are our primary sources of liquidity for the next 12 months. We expect our liquidity to fund capital expenditures, payments of interest and principal on our debt, cash-based restructuring charges and distributions to shareholders that require approval by our Board of Directors. Additionally, we may continue to utilize portions of our excess cash to repurchase certain amounts of our long-term debt prior to maturity depending on market conditions, among other factors.

Cash flows

Our cash flows for the ~~six~~nine months ended ~~June~~September 30, 2024 and 2023 were as follows:

	For the Six Months Ended June 30,
	For the Nine Months Ended September 30,
(In millions)	2024			2023
Net cash provided by operating activities	$	61305		$	~~215~~453
Net cash used in investing activities		(~~100~~153	)		(~~114~~167	)
Net cash used in financing activities		(52168	)		(~~337~~587	)
Effect of exchange rate on cash, cash equivalents and restricted cash		(13	)		51
Net decrease in cash, cash equivalents and restricted cash	$	(9219	)	$	(~~231~~300	)

Net cash outflows decreased by $~~139~~281 million, or 6094%, compared to the prior year period primarily due to a decrease in cash used in financing activities driven by $~~290~~515 million of early debt repayments and repurchases in the prior year period, partially offset by lower net cash provided by operating activities. Net cash provided by operating activities decreased primarily due to ~~unfavorable~~lower income from operations and changes in ~~inventory~~working ~~and~~capital, ~~lower~~including ~~income~~a ~~from~~reduction ~~operations~~in inventory during the prior period.

During the six months ended June 30, 2024, our primary source of cash was $61 million of net cash provided by operating activities. The net cash provided by operating activities reflects income from operations, partially offset by $116 million of cash interest payments and $37 million of cash taxes. Our primary uses of cash were $98 million of capital expenditures and $36 million of dividends paid.33

During the ~~six~~nine months ended ~~June~~September 30, ~~2023~~2024, our primary source of cash was $~~215~~305 million of net cash provided by operating activities. The net cash provided by operating activities reflects income from operations, partially offset by $~~135~~148 million of cash interest payments and $3148 million of cash taxes. Our primary uses of cash ~~for the same period~~ were $~~290~~152 million of ~~early~~capital ~~debt repayments and repurchases~~expenditures, $~~116~~67 million of ~~capital~~early ~~expenditures~~term loan debt repayments and $3654 million of dividends paid.

During the nine months ended September 30, 2023, our primary source of cash was $453 million of net cash provided by operating activities. The net cash provided by operating activities reflects income from operations, partially offset by $177 million of cash interest payments and $51 million of cash taxes. Our primary uses of cash for the same period were $515 million of early debt repayments, $178 million of capital expenditures and $54 million of dividends paid.

Dividends

During each of the ~~six~~nine months ended ~~June~~September 30, 2024 and 2023, we paid cash dividends of $3654 million. On ~~July~~November 298, 2024, our Board of Directors declared a dividend of $0.10 per share to be paid on ~~September~~December 13, 2024 to shareholders of record as of ~~August~~December 302, 2024.

Our Credit Agreement and Notes limit our ability to make dividend payments, subject to specified exceptions. Our Board of Directors must review and approve future dividend payments and will determine whether to declare additional dividends based on our operating performance, expected future cash flows, debt levels, liquidity needs and investment opportunities.

Financing and capital resources

As of ~~June~~September 30, 2024, we had $3,~~604~~507 million of total principal amount of borrowings. Refer to Note 7, Debt, for additional details. Of our total debt, $1,~~682~~587 million is subject to variable interest rates, representing borrowings drawn under our Credit Agreement. As of ~~June~~September 30, 2024, $~~682~~587 million of the total $1,~~682~~587 million of variable interest rate indebtedness was not hedged by an interest rate swap, and any additional interest rate swaps into which we enter may not fully mitigate our remaining interest rate risk.

During the ~~six~~nine months ended ~~June~~September 30, 2024, we borrowed $391 million of our Revolving Tranche facility and repaid $3661 million plus interest. On October 31, 2024, we repaid an additional $70 million.

On May 28, 2024, we further amended the Credit Agreement to replace the existing $990 million outstanding U.S. term loans Tranche B-3 with a new upsized $1,330 million of U.S. term loans Tranche B-4. The U.S. term loans Tranche B-4 will mature on September 24, 2028. The $340 million proceeds from upsizing the U.S. term loans, together with the proceeds of a $350 million draw upon our Revolving Tranche facility, were used to prepay in full the $690 million of existing U.S. term loans Tranche B-2 maturing in February 2026. The U.S. term loans Tranche B-4 have a lower interest rate relative to the U.S. term loans Tranche B-2 and B-3 that they replaced. There were no other material changes to the terms of the Credit Agreement as a result of these amendments.

AsOn ofSeptember ~~June~~ 30, 2024, ~~the~~we ~~SOFR~~repaid $70 million of U.S. term loans Tranche B-~~based~~4, ~~reference~~of ~~rate~~which $67 million was 5considered a prepayment.~~34%~~ As a result of this prepayment, we have no further quarterly amortization payments under the U.S. term loans.

~~Based~~As ~~on the one-month SOFR as~~ of ~~June~~September 30, 2024, ~~and including~~ the ~~impact~~SOFR-based ofreference ~~our interest~~ rate ~~swap~~was ~~agreements, our 2024 annual cash interest obligations on our borrowings are expected to be approximately $230 million~~4.85%.

Based on the one-month SOFR as of September 30, 2024, and including the impact of our interest rate swap agreements, our 2024 annual cash interest obligations on our borrowings are expected to be approximately $220 million.

Under the Credit Agreement, we may incur additional indebtedness either by satisfying certain incurrence tests or by incurring such additional indebtedness under certain specific categories of permitted debt. Incremental senior secured indebtedness under the Credit Agreement and senior secured or unsecured notes in lieu thereof are permitted to be incurred up to an aggregate principal amount of $750 million subject to pro forma compliance with the Credit Agreement’s total secured leverage ratio covenant. In addition, we may incur senior secured indebtedness in an unlimited amount as long as our total secured leverage ratio does not exceed 4.50 to 1.00 on a pro forma basis, and (in the case of incremental senior secured indebtedness under the Credit Agreement only) we are in pro forma compliance with the Credit Agreement’s total secured leverage ratio covenant. The incurrence of unsecured indebtedness, including the issuance of senior notes, and unsecured subordinated indebtedness is also permitted (subject to the terms of the Credit Agreement) if the fixed charge coverage ratio is at least 2.00 to 1.00 on a pro forma basis.

Under the respective indentures governing the Notes, we may incur additional indebtedness either by satisfying certain incurrence tests or by incurring such additional indebtedness under certain specific categories of permitted debt. Indebtedness may be incurred under the incurrence tests if the fixed charge coverage ratio is at least 2.00 to 1.00 on a pro forma basis or the consolidated total leverage ratio is no greater than 5.50 to 1.00 and the liens securing first lien secured indebtedness do not exceed a 4.10 to 1.00 consolidated secured first lien leverage ratio.

We are required to make annual prepayments of term loans with up to 50% of excess cash flow (which will be reduced to 25% or 0% if specified senior secured first lien leverage ratios are met) as determined in accordance with the Credit Agreement. No excess cash flow prepayments were due for the year ended December 31, 2023.

Liquidity and working capital

Our liquidity position is summarized in the table below:

	As of		As of
(In millions, except for current ratio)	~~June~~September 30, 2024		December 31, 2023
Cash and cash equivalents(1)	$	95168	$	164
Availability under revolving credit facility		~~696~~724		201
	$	~~791~~892	$	365
Working capital(2)		~~822~~790		793
Current ratio		21.09		2.0

(1)

Excluded $21 million of restricted cash classified as other noncurrent assets as of December 31, 2023.

(2)

Included $99 million of assets and $22 million of liabilities classified as held for sale as of September 30, 2024, and $4 million of assets classified as held for sale as of December 31, 2023.

As of ~~June~~September 30, 2024, we had $95168 million of cash and cash equivalents on-hand. We also had $~~696~~724 million available under our revolving credit facility, net of $4946 million utilized in the form of letters of credit under the facility. Our next debt maturity is $217 million of Pactiv Debentures due in December 2025, excluding ~~amortization~~finance ~~payments~~lease ~~related to our U~~obligations.~~S. term loans Tranche B-4 under our Credit Agreement.~~

34We believe that we have sufficient liquidity to support our ongoing operations in the next 12 months and to invest in future growth to create further value for our shareholders. The increased liquidity for the nine months ended September 30, 2024 was primarily due to the amendment to our Credit Agreement increasing the availability under our Revolving Tranche facility. We currently anticipate making cash payments between $240 million and $250 million in the aggregate for capital expenditures during 2024.

WeDuring ~~believe that we have sufficient liquidity to support our ongoing operations in~~ the ~~next~~nine 12 months ~~and~~ended toSeptember ~~invest~~30, in2024, ~~future growth to create further value for~~ our ~~shareholders.~~working ~~The~~capital ~~increased~~was ~~liquidity~~consistent ~~for~~with the ~~six~~prior ~~months~~year ~~ended~~period. Our ~~June~~working ~~30,~~capital ~~2024~~position ~~was~~provides ~~primarily~~us ~~due to~~ the ~~amendment~~flexibility tofor ~~our~~further ~~Credit~~consideration ~~Agreement~~of ~~increasing~~strategic ~~the~~initiatives, ~~availability~~including ~~under~~reinvestment in our ~~Revolving~~business ~~Tranche facility~~ and ~~$61~~deleveraging ~~million~~ of ~~net~~our ~~operating~~balance ~~cash flows~~sheet. ~~These~~As ~~increases~~a ~~were~~result, ~~partially~~we ~~offset~~may bycontinue ~~$98~~to ~~million~~utilize ofportions ~~capital expenditures and $36 million~~ of ~~dividends~~our ~~paid.~~excess Wecash ~~currently~~to ~~anticipate~~repurchase ~~making~~certain ~~cash~~amounts ~~payments~~ of ~~approximately~~our ~~$260~~long-term ~~million~~debt inprior ~~the~~to ~~aggregate~~maturity ~~for~~depending ~~capital~~on ~~expenditures~~market ~~during~~conditions, ~~2024~~among other factors.

During the six months ended June 30, 2024, our working capital increased $29 million, or 4%, primarily due to increases in inventory levels. Our working capital position provides us the flexibility for further consideration of strategic initiatives, including reinvestment in our business and deleveraging of our balance sheet. As a result, we may continue to utilize portions of our excess cash to repurchase certain amounts of our long-term debt prior to maturity depending on market conditions, among other factors.

Our ability to borrow under our revolving credit facility or to incur additional indebtedness may be limited by the terms of such indebtedness or other indebtedness, including the Credit Agreement and the Notes. The Credit Agreement and the respective indentures governing the Notes generally allow our subsidiaries to transfer funds in the form of cash dividends, loans or advances within the Company.

Other than short-term leases executed in the normal course of business, we have no material off-balance sheet obligations.

Critical Accounting Policies, Estimates and Assumptions

The most critical accounting policies and estimates are those that are most important to the portrayal of our financial condition and results of operations and require us to make the most difficult and subjective judgments, often estimating the outcome of future events that are inherently uncertain. Our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies, to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2023. Our critical accounting estimates are described in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.

Recent Accounting Pronouncements

New accounting standards that we have recently adopted, as well as accounting standards that have been recently issued but not yet adopted by us, is included in Note 1, Nature of Operations and Basis of Presentation.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Except as noted below, there have been no material changes to our market risk during the ~~six~~nine months ended ~~June~~September 30, 2024. For additional information, refer to Item 7A, Quantitative and Qualitative Disclosures about Market Risk, in our Annual Report on Form 10-K for the year ended December 31, 2023.

Foreign Currency Exchange Rate Risk

As a result of our operations in Mexico, we are exposed to foreign currency exchange risk arising from certain transactions and related assets and liabilities denominated in U.S. dollars instead of the Mexican peso.

In accordance with our treasury policy, we take advantage of natural offsets to the extent possible. On a limited basis, we use contracts to hedge foreign currency exchange risk arising from receipts and payments denominated in foreign currencies. We generally do not hedge our exposure to translation gains or losses in respect of our non-U.S. dollar functional currency assets or liabilities. Additionally, when considered appropriate, we may enter into forward exchange contracts to hedge foreign currency exchange risk arising from specific transactions. As of ~~June~~September 30, 2024, we had contracts with U.S. dollar equivalent notional amounts of $168 million to exchange the Mexican peso in order to hedge certain U.S. dollar purchases of inventory.

A 10% increase or decrease in the spot rate used to value the forward exchange contracts, applied as of ~~June~~September 30, 2024, would have resulted in a change of $21 million in the unrealized gain recognized in the condensed consolidated statement of comprehensive ~~income~~ (loss) income.

Item 4. Controls and Procedures.

a) Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. In connection with the preparation of this report, management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of ~~June~~September 30, 2024. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of ~~June~~September 30, 2024, our disclosure controls and procedures were effective.

b) Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended ~~June~~September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

The information required to be set forth under this heading is incorporated by reference from Note 11, Commitments and Contingencies, to the interim Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors.

There have been no material changes to the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

10b5-1 Trading Arrangements

During the three months ended ~~June~~September 30, 2024, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) and/or any “non-Rule 10b5-1 trading arrangement.”

Item 6. Exhibits.

The following exhibits are filed as part of, or are incorporated by reference in, this report:

				Incorporated by Reference
Exhibit	Exhibit Title	Filed Herewith	Furnished Herewith	Form	Exhibit No.	Date Filed
3.1	Amended and Restated Certificate of Incorporation of the Registrant and Certificate of Amendment thereto.	X		10-Q	3.1	July 31, 2024
3.2	Amended and Restated Bylaws of the Registrant.			8-K	3.2	Sept. 21, 2020
10.1	Specified Refinancing Amendment, Incremental Amendment and Administrative Agency Transfer Agreement (Amendment No. 17), dated as of May 1, 2024, by and among Pactiv Evergreen Group Holdings Inc., Pactiv LLC, Evergreen Packaging LLC, the Registrant, the guarantors from time to time party thereto, the lenders from time to time party thereto, Credit Suisse AG, Cayman Islands Branch, as administrative agent for the lenders, and Wells Fargo Bank, National Association, as administrative agent for the revolving credit lenders.			10-Q	10.1	May 3, 2024
10.2	Specified Refinancing Amendment and Administrative Agency Transfer Agreement (Amendment No. 18), dated as of May 28, 2024, by and among Pactiv Evergreen Group Holdings Inc., Pactiv LLC, Evergreen Packaging LLC, the Registrant, the guarantors from time to time party thereto, the lenders from time to time party thereto, Credit Suisse AG, Cayman Islands Branch, as term loan facility administrative agent, and Wells Fargo Bank, National Association, as revolving credit facility administrative agent.			8-K	10.1	May 29, 2024
10.3	Fourth Amended and Restated Credit Agreement, dated as of August 5, 2016, as conformed to reflect amendments through Amendment No. 18, dated May 28, 2024, by and among Pactiv Evergreen Group Holdings Inc., Pactiv LLC, Evergreen Packaging LLC, the Registrant, the guarantors from time to time party thereto, the lenders from time to time party thereto and Wells Fargo Bank, National Association, as administrative agent.			8-K	10.2	May 29, 2024
10.4*	Amended and Restated Equity Incentive Plan of Pactiv Evergreen Inc., dated as of June 5, 2024.			8-K	10.1	June 7, 2024
10.5**	Warehousing and Freight Services Agreement, dated as of November 1, 2019, between Reynolds Consumer Products LLC and Pactiv LLC, and Amendment No. 1, Amendment No. 2 and Amendment No. 3 thereto.	X
31.1	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	X
31.2	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	X
32.1	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.		X
32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.		X
101.INS	Inline 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	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

	of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	X
32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	X
101.INS	Inline 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	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Indicates a management contract or compensatory plan.

** Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K because they are not material and are of the type that the registrant treats as private or confidential. The registrant agrees to furnish an unredacted copy of this exhibit and the registrant’s materiality and privacy or confidentiality analyses on a supplemental basis to the SEC or its staff upon request.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			PACTIV EVERGREEN INC.
			(Registrant)
	By:		/s/ Jonathan H. Baksht
			Jonathan H. Baksht
			Chief Financial Officer (principal financial officer and principal accounting officer)
			July 31, 2024
			November 12, 2024

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Filing Compare · Pactiv Evergreen Inc.