EXIT ACTIVITIES

3 Months Ended

Mar. 31, 2025

Restructuring and Related Activities [Abstract]

During 2024, the Company decided to close multiple packaging facilities by the end of 2024 and early 2025. These are in addition to the multiple packaging facilities that the Company decided to close by the end of 2023 and early 2024. Production from these facilities will be consolidated into other existing packaging facilities. The costs associated with these exit activities are included in the table below for the three months ended March 31, 2025 and 2024.

On February 7, 2023, the Company announced its plan to build a new recycled paperboard manufacturing facility located in Waco, Texas. In conjunction with this project, the Company expects to close two smaller recycled paperboard manufacturing facilities in order to consolidate production into fewer, more efficient locations. On April 1, 2025, the Company announced its intention to permanently close one of these facilities, the Middletown, Ohio recycled paperboard manufacturing facility, on or about June 1, 2025. The costs associated with these exit activities are included in the table below for the three months ended March 31, 2025 and 2024.

During the three months ended March 31, 2025 and 2024, the Company recorded $18 million and $21 million of exit costs, respectively, associated with these restructurings. Other costs associated with the start-up of the new recycled paperboard machine are recorded in the period in which they are incurred.

The following table summarizes the costs incurred during the three and three months ended March 31, 2025 and 2024 related to these restructurings:


		Three Months Ended March 31,
In millions	Location in Statement of Operations	2025		2024
Asset Write-Offs and Start-Up Costs(a)	Business Combinations, Exit Activities and Other Special Items, Net	$	12	$	7
Severance Costs and Other(b)	Business Combinations, Exit Activities and Other Special Items, Net	2		2
Accelerated Depreciation	Cost of Sales	4		12
Total		$	18	$	21

(a) Costs incurred include non-cash write-offs for items such as machinery, supplies and inventory.

(b) Costs incurred include activities for post-employment benefits, retention bonuses, incentives and professional services (see “Note 1 - Business Combinations, Exit Activities and Other Special Items, Net”).

The following table summarizes the balance of accrued expenses related to restructuring:


In millions	Total
Balance at December 31, 2024	$	33
Costs Incurred	2
Payments	(6)
Adjustments(a)	(3)
Balance at March 31, 2025	$	26

(a) Adjustments related to changes in estimates of severance costs.

As a result of the announced closures of the recycled paperboard manufacturing facilities, the Company has incurred charges within Corporate and Other for post-employment benefits, retention bonuses and incentives of $21 million, and accelerated depreciation, inventory and asset write-offs of $15 million from announcement date through March 31, 2025. The Company expects to incur total charges associated with these exit activities for post-employment benefits, retention bonuses and incentives in the range of $25 million to $30 million and for accelerated depreciation, inventory and asset write-offs in the range of $16 million to $20 million through 2026.

Due to the expected closures of the packaging facilities and other exit activities, the Company has incurred charges within the Americas Paperboard Packaging and International Paperboard Packaging reportable segments for post-employment benefits, retention bonuses and incentives of $18 million from announcement date through March 31, 2025. The Company also incurred charges within the Americas Paperboard Packaging and International Paperboard Packaging reportable segments for accelerated depreciation, inventory and asset write-offs of $24 million from announcement date through March 31, 2025. The Company expects to incur total charges associated with these exit activities for post-employment benefits, retention bonuses and incentives in the range of $20 million to $22 million and for accelerated depreciation, inventory and asset write-offs in the range of $25 million to $27 million through 2025.

Additionally, the Company has incurred start-up charges within Corporate and Other for the new recycled paperboard manufacturing facility in Waco of $21 million from announcement date through March 31, 2025. The Company expects to incur total start-up charges of approximately $65 million to $75 million for the new recycled paperboard manufacturing facility through 2026.