Oct 28, 2026 earnings call — Cost inflation and price recovery actions
Full-year 2026 adjusted EBITDA now expected at approximately $4.7 billion, citing unprecedented cost inflation and energy headwinds.
Revenue $8.2B (est $8.3B) · EPS $0.42 (est $0.60)
Key quotes
"These results show great resilience in the face of unprecedented and greater than anticipated cost inflation."
"we have, by necessity, implemented price increases across most paper grades which are being passed on with the normal time lag."
"Our people have embraced our new Smurfit WestRock performance led and owner operator culture."
Analyst Q&A 8
North America volumes and pricing
Q (George Staphos · BofA): He asked about North America volume progression and how a volume-driven profit bridge worked when volumes were down. He also asked whether converting margin pressure changes their pricing approach.
A: They expect volumes to be roughly back to last year in Q4 if no new market shocks occur; October was line ball with last year and November order books look reasonable. North America positive volume growth came from third-party paper sales. They remain focused on recovering non-paper costs through negotiation and pricing actions and see sequential margin and pricing improvement.
"The net positive volume in North America is remember, we have a lot of third party sales, so the positive growth you see in there is around third-party paper sales." — Ken Bowles
Converting margins and 2030 plan timing
Q (Hillary Cacanando · Deutsche Bank): She asked the level of converting margins today and whether the lower 2026 EBITDA starting point changes the 2030 plan.
A: Converting margin is a little below the prior 3-4% because paper is transferred at market price and box pricing needs time to catch up; they expect margin improvement as the latest paper increase passes through in Q1 and Q2. The lower 2026 starting point is mainly timing; the structural plan to 2030 is unchanged though timing of when targets are reached may flex.
"it is a little bit lower than that now, Hillary, because we take in the paper price into our converting business we transfer at the market price." — Anthony Paul J. Smurfit (CEO)
How price increases split cost vs margin
Q (Michael Roxland · Truist): He asked how much of roughly $170/ton industry price increases were cost recovery versus margin for the company. He also asked for early 2027 EBITDA guideposts.
A: They view the first $100/ton as largely cost recovery; more recent increases would be broad margin enhancement, though the cost backdrop has continued to be elevated and unanticipated. They have not finished budgets for 2027 but are comfortable that results should be significantly better if current conditions hold, subject to uncertainty on costs.
"I would say that the first $100 is really just basically recovering the cost." — Anthony Paul J. Smurfit (CEO)
Timing of price recovery into boxes
Q (Mark Weintraub · Seaport Research Partners): He asked about sensitivities, hedging, and timing for containerboard price recovery rolling into box prices by region.
A: They expect full cost recovery of the latest increase in Q1 of next year and stronger translation of paper increases into higher export and other paper grades later this quarter and strongly into early next year. Hedging has been used selectively; they have some hedges but not at current extreme levels, and diesel moves have a large sensitivity (every $1 on diesel impacts roughly $80 million direct, $120 to $130 million total in North America).
"We have said that we expect to get the full cost recovery of the latest increase you know, in Q1 of next year." — Anthony Paul J. Smurfit (CEO)
Consumer grades and Europe supply
Q (Anthony Pettinari · Citi): He asked where the consumer business stands on cost recovery and pricing traction, and whether Europe is seeing supply come off given energy stress.
A: For consumer grades, CRB is steady, SBS is sold out and they are seeking increases to recover lost ground, while some CRB mills are not their strongest and lack pricing momentum there. In Europe, downtime and government support are delaying closures but it is inevitable some supply will come off if energy costs stay high; many mills are making little or no EBITDA at current costs.
"On consumer, I would say that it is steady as she goes on the CUK market." — Anthony Paul J. Smurfit (CEO)
New European capacity and pricing
Q (Andrew Jones · UBS): He asked whether new capacity in Italy, Berlin, U.K. will pressure pricing into 2027 if the high cost environment persists.
A: Most new capacity is from established players who are unlikely to lower prices to win volume because of capital needs; instead, the market will manage via downtime to protect returns. They see the independent supplier base shrinking and expect players to prioritize returns rather than cut price, though energy-driven demand effects remain a risk.
"I think the reality is that you know, of all the new capacity coming on, they are all people who have in the game already, if you like, in terms of a system in play." — Ken Bowles
Price vs cost across regions
Q (Detlef Winckelmann · JPMorgan): He asked whether price increases will offset cost inflation only in North America or also in Europe, and whether downstream discounting risks exist.
A: They expect the same pattern across all regions: price increases lag costs by months but ultimately offset them, with North America slightly quicker than Europe. There is some downstream discounting noise from a player seeking volume, but overall their quality, service and innovation should allow them to be paid and they are not overly worried.
"The mechanism, if you like, in terms of paper price increase into the index or indeed the freedom associated is probably slightly quicker in North America than Europe by a couple of months, but ultimately, it is exactly the same pattern." — Ken Bowles
Natural gas hedges and next steps
Q (Philip Ng · Jefferies): He asked how nat gas hedges and current hedging positions affect the company's ability to achieve positive spread next year and what goals remain after the WestRock asset integration.
A: The announced paper price increases, including net $1.40 on Testliner, already take hedging into account and hedging generally is a net incremental positive to paper price recovery; they have taken a conservative view. They avoid hedging at current extreme energy levels because a sharp price fall would leave them uncompetitive; management highlighted regional mill fixes, improved owner-operator model, and integrating mills as key ongoing priorities.
"Hey, Philip. But the price increases we announced, that net $1.40 on Testliner would have ultimately Taken Into Account." — Ken Bowles