Sonoco's Q2 2025 Earnings Call: Unpacking Key Contradictions in Volume Growth, EPS Guidance, and Acquisition Synergies

SMP EMEA's organic volume growth expectations, earnings per share guidance, Eviosys EBITDA guidance, interest expense expectations, and Eviosys acquisition and synergies are the key contradictions discussed in Sonoco's latest 2025Q2 earnings call.



Strong Financial Performance and Margin Expansion:
- Sonoco reported net sales growth of 49% and adjusted EBITDA growth of 25% for Q2 2025.
- Adjusted EBITDA margin expanded by 100 basis points to 17.2%.
- This performance was driven by favorable price/cost dynamics and productivity improvements, particularly in the Industrial segment, where EBITDA margins reached 19%.

Consumer Packaging Segment Growth:
- Sonoco's Consumer Packaging segment achieved a 115% increase in adjusted EBITDA, with the Metal Packaging business contributing a 10% growth in volume/mix.
- The segment benefited from the integration of Eviosys, now rebranded as Sonoco Metal Packaging, SMP EMEA, and solid productivity savings.
- The growth was supported by strong demand in the U.S. Metal Packaging business and new customer wins.

Industrial Segment Improvement:
- The Industrial segment reported a 16% increase in adjusted EBITDA, with margins expanding to 19%.
- This was attributed to a favorable price/cost environment and productivity gains.
- The segment's margin improvement reflects the company's focus on driving value-based pricing and productivity savings.

SMP EMEA Challenges and Recovery:
- Sonoco's Metal Packaging EMEA operations faced a softer-than-expected first half due to delays in vegetable packaging season and reduced sardine availability.
- The segment is expected to achieve run rate synergies between $40 million to $50 million by the end of the year.
- Despite challenges, the outlook is positive, with expectations of a solid vegetable harvest and new customer opportunities.