Breaking Down Ranpak Holdings Corp. (PACK) Financial Health: Key Insights for Investors

Are you keeping a close watch on Ranpak Holdings Corp. (PACK) and wondering about its financial stability? Did you know that in 2024, Ranpak's net revenue increased by 10% to reach $368.9 million? But how does this growth translate into overall financial health, and what are the key factors driving these results? With a narrowed net loss of $18.7 million from $27.1 million in 2023 and an adjusted EBITDA increase of 14% to $83.8 million, understanding the nuances of Ranpak's financial performance is crucial for making informed investment decisions.

Ranpak Holdings Corp. (PACK) Revenue Analysis

Understanding Ranpak Holdings Corp.'s revenue streams is crucial for investors seeking to assess the company's financial health and growth potential. A detailed examination of revenue sources, growth rates, and segment contributions provides valuable insights into the company's performance. For additional insights, you might find this resource helpful: Breaking Down Ranpak Holdings Corp. (PACK) Financial Health: Key Insights for Investors

A breakdown of Ranpak's primary revenue sources reveals how the company generates its income. These sources typically include:

• Products: Sales of protective packaging solutions, such as paper-based cushioning and void-fill systems.
• Services: Revenue from installation, maintenance, and training services related to their packaging equipment.
• Geographic Regions: Revenue segmented by key geographic markets, including North America, Europe, and Asia-Pacific.

Analyzing the year-over-year revenue growth rate provides a clear picture of Ranpak's historical performance. Tracking the percentage increase or decrease in revenue helps identify trends and assess the company's growth trajectory. For instance, a consistent increase in revenue year after year suggests strong market demand and effective sales strategies. However, a decline in revenue may signal challenges such as increased competition or changing market conditions.

The contribution of different business segments to Ranpak’s overall revenue is another critical aspect to consider. By examining the revenue generated by each segment, investors can determine which areas are driving growth and profitability. For example, if the protective packaging solutions segment accounts for a significant portion of total revenue, it indicates the importance of this product line to the company's financial performance.

Significant changes in revenue streams also warrant close attention. These changes could include the introduction of new products or services, expansion into new geographic markets, or shifts in customer demand. Understanding the reasons behind these changes is essential for assessing their potential impact on Ranpak's future revenue and profitability.

To illustrate, consider a hypothetical scenario based on the fiscal year 2024. Let's assume Ranpak reported total revenue of $300 million. A possible breakdown could be:

• Protective Packaging Solutions: $200 million
• Services: $50 million
• Geographic Regions:
  • North America: $150 million
  • Europe: $100 million
  • Asia-Pacific: $50 million

In this scenario, protective packaging solutions are the primary revenue driver, contributing approximately 67% of the total revenue. North America is the largest geographic market, accounting for 50% of the total revenue. Analyzing these figures helps investors understand the relative importance of different revenue streams and assess the company's geographic diversification.

Here is a sample table showcasing a hypothetical revenue breakdown for Ranpak in 2024:

This table offers a structured view of Ranpak's revenue composition, highlighting the contribution of each segment and geographic region. Investors can use this information to evaluate the company's revenue diversification and identify potential areas of strength and weakness.

Ranpak Holdings Corp. (PACK) Profitability Metrics

Understanding Ranpak Holdings Corp.'s profitability involves examining its gross profit, operating profit, and net profit margins. These metrics reveal how efficiently Ranpak manages its costs and generates profit from its revenue. Let's delve into these key areas to assess Ranpak's financial health.

Gross Profit: Gross profit is the revenue a company retains after deducting the cost of goods sold (COGS). It indicates how efficiently a company manages its production costs. For Ranpak, monitoring the gross profit trend helps investors understand if the company is controlling its direct costs effectively. A rising gross profit generally suggests improved operational efficiency, while a declining gross profit may signal issues with cost management or pricing strategies.

Operating Profit: Operating profit is derived by deducting operating expenses (such as administrative and sales costs) from the gross profit. This metric offers insights into the profitability of Ranpak's core business operations, excluding the effects of interest and taxes. A growing operating profit margin indicates enhanced operational efficiency and better cost control, which are positive signs for investors.

Net Profit: Net profit represents the actual profit earned after all expenses, including interest and taxes, are deducted from revenue. The net profit margin, calculated as net profit divided by revenue, provides a comprehensive view of the company's overall profitability. Investors closely monitor the net profit margin to assess the bottom-line profitability and overall financial health of Ranpak.

Analyzing these profitability metrics over time provides a clearer picture of Ranpak's financial trajectory. Comparing Ranpak's profitability ratios with industry averages can further contextualize its performance. If Ranpak's margins are in line with or exceed those of its peers, it suggests competitive efficiency. Conversely, lower margins may indicate areas needing improvement.

Operational efficiency is crucial for maintaining and improving profitability. Effective cost management and favorable gross margin trends are indicators of a well-run operation. Investors should examine how Ranpak manages its operational costs and how these strategies impact its profitability.

For a more detailed analysis, consider the following:

• Gross Profit Margin: Calculated as (Gross Profit / Revenue) 100.
• Operating Profit Margin: Calculated as (Operating Profit / Revenue) 100.
• Net Profit Margin: Calculated as (Net Profit / Revenue) 100.

These ratios help in benchmarking Ranpak against its competitors and historical performance.

Here's a hypothetical table illustrating how these metrics might be tracked over a few years:

In this example, there is a clear, consistent improvement in all margins, reflecting enhanced profitability and efficient management over the years.

To gain more insights into Ranpak's financial health, you can read: Breaking Down Ranpak Holdings Corp. (PACK) Financial Health: Key Insights for Investors

Ranpak Holdings Corp. (PACK) Debt vs. Equity Structure

Understanding how Ranpak Holdings Corp. (PACK) finances its operations and growth is crucial for investors. This involves analyzing the company's debt levels, its debt-to-equity ratio, and how it strategically uses debt and equity to fund its activities. Here’s a breakdown of Ranpak's approach to balancing debt and equity.

As of the fiscal year 2024, Ranpak Holdings Corp. (PACK) exhibits the following debt profile:

• Long-term Debt: Ranpak carries a significant amount of long-term debt, which is used to fund major projects, acquisitions, and strategic initiatives. Understanding the maturity schedule and interest rates on this debt is important for assessing future financial obligations.
• Short-term Debt: The company also utilizes short-term debt to manage immediate operational needs and working capital requirements. Monitoring the levels and terms of this debt provides insights into Ranpak’s liquidity and short-term financial health.

The debt-to-equity ratio is a key metric for evaluating Ranpak’s financial leverage. This ratio indicates the proportion of debt and equity the company uses to finance its assets. A higher ratio suggests greater financial risk, as the company relies more on debt, which carries fixed interest payments and potential repayment pressures.

Ranpak's debt-to-equity ratio can be compared against industry standards to gauge whether the company's leverage is typical for its sector. Differences may reflect varying business models, growth strategies, or risk tolerances.

Recent activities, such as new debt issuances, changes in credit ratings, or refinancing efforts, can significantly impact Ranpak’s financial structure. For example, a debt refinancing might lower interest rates, improving cash flow, while a credit rating downgrade could increase borrowing costs.

Ranpak strategically balances debt and equity to optimize its capital structure. Debt financing can provide tax advantages and maintain ownership control, while equity funding can reduce financial risk and improve the company's balance sheet. The optimal mix depends on factors like growth opportunities, market conditions, and investor sentiment.

For further insights into Ranpak's values and strategic direction, see Mission Statement, Vision, & Core Values of Ranpak Holdings Corp. (PACK).

Ranpak Holdings Corp. (PACK) Liquidity and Solvency

Liquidity and solvency are crucial indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For Ranpak Holdings Corp. (PACK), assessing these metrics provides valuable insights for investors.

Assessing Ranpak Holdings Corp.'s Liquidity:

Analyzing Ranpak Holdings Corp.'s liquidity involves examining key ratios and cash flow trends. Here's a breakdown:

• Current and Quick Ratios: These ratios measure a company's ability to cover its short-term liabilities with its current assets. The current ratio includes all current assets, while the quick ratio excludes inventory, which is typically less liquid.
• Analysis of Working Capital Trends: Working capital, calculated as current assets minus current liabilities, indicates a company's operational efficiency and short-term financial health. Monitoring changes in working capital can reveal whether a company is becoming more or less efficient in managing its resources.
• Cash Flow Statements Overview: A thorough look at the cash flow statement is essential to understand the sources and uses of cash. This includes:
  • Operating Cash Flow: Cash generated from the company's core business activities.
  • Investing Cash Flow: Cash used for investments in assets, such as property, plant, and equipment (PP&E).
  • Financing Cash Flow: Cash flow related to debt, equity, and dividends.
• Potential Liquidity Concerns or Strengths: Identifying any red flags or positive signs related to liquidity is vital. This could include a consistently low current ratio, negative operating cash flow, or a high level of short-term debt. Conversely, a high current ratio, strong operating cash flow, and minimal short-term debt indicate strong liquidity.

Below is an example of how liquidity ratios can be laid out for analysis:

For deeper insights into Ranpak Holdings Corp. (PACK) and its investors, consider exploring this resource: Exploring Ranpak Holdings Corp. (PACK) Investor Profile: Who’s Buying and Why?

Ranpak Holdings Corp. (PACK) Valuation Analysis

Assessing whether Ranpak Holdings Corp. (PACK) is overvalued or undervalued requires examining several key financial metrics and analyst perspectives. Here's a breakdown:

Valuation Ratios:

• Price-to-Earnings (P/E) Ratio: As of April 2025, Ranpak's P/E ratio for 2025 is projected at -16.3x and for 2026 at -35x. These negative values indicate that the company is currently not profitable.
• Price-to-Book (P/B) Ratio: Ranpak's P/B ratio is 0.53, suggesting that the market values the company's assets at less than their book value.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: Given an EBITDA of $89 million and an enterprise value of $295 million, the EV/EBITDA ratio is approximately 3.31x.
• EV/Sales: The EV/Sales ratio for 2025 is estimated at 0.74x and for 2026 at 0.69x.

Stock Price Trends:

• Current Price: As of April 17, 2025, the stock price is $3.50.
• 52-Week Range: The 52-week range is $3.42 to $9.04.
• 1-Year Performance: An investment at IPO in 2018 would have resulted in a -7.11% compound annual growth rate.
• Throughout December 2024, the stock price fluctuated, with highs around $8.04 and lows near $7.07.

Dividend Yield and Payout Ratios:

• Ranpak does not currently pay dividends. Therefore, the dividend yield is 0.00%.
• There is no dividend history available for Ranpak.

Analyst Consensus:

• Rating: The consensus rating is 'Moderate Buy'.
• Based on ratings from 4 analysts, 2 suggest a 'Hold' and 2 suggest a 'Buy'.
• Price Target: The average 12-month price target is $9.50.
• The highest price target is $11.50, while the lowest is $7.00.
• This average price target represents a forecasted upside of 177.37% from the current price.

Additional Ratios and Metrics:

Given these metrics, here's a summary of analyst ratings:

Explore more about Ranpak Holdings Corp. and gain valuable investor insights: Exploring Ranpak Holdings Corp. (PACK) Investor Profile: Who’s Buying and Why?

Ranpak Holdings Corp. (PACK) Risk Factors

Several internal and external risk factors could significantly influence Ranpak Holdings Corp.'s (PACK) financial stability. These risks span industry competition, regulatory changes, and broader market conditions. A comprehensive understanding of these potential challenges is crucial for investors.

Here's an overview of the key risks:

• Industry Competition: The paper packaging industry is highly competitive. Ranpak faces competition from both large and small companies, some of which may have greater financial and other resources.
• Regulatory Risks: Evolving environmental regulations and product registration laws could significantly increase operating costs and expose Ranpak to potential financial liabilities.
• Market Conditions: As Ranpak operates globally, it is exposed to market risks, particularly fluctuations in foreign currency exchange rates, which could materially impact its financial results.

Recent earnings reports and filings have highlighted several operational, financial, and strategic risks. Understanding these risks is essential for assessing the company's overall financial health.

Key highlights from recent reports include:

• Operational Risks: The global nature of Ranpak's operations exposes it to risks such as foreign currency fluctuations, geopolitical tensions, and disruptions in assembly and distribution operations. The company's reliance on third-party suppliers and distributors also presents risks related to supply chain continuity and potential cost increases.
• Financial Risks: Ranpak's level of indebtedness could adversely affect its financial condition and ability to fulfill its obligations. The company's ability to secure additional financing may be limited, impacting its growth and operational capabilities. In 2024, interest expenses increased to $28.6 million from $24.3 million in 2023, driven by higher interest rates and additional expenses from deferred financing costs.
• Strategic Risks: Investments in research and development (R&D) may not yield the expected results, and efforts to expand into adjacent markets may not succeed, potentially impacting the company's competitive position and growth prospects.

In its 10-K report dated March 17, 2025, Ranpak identified material weaknesses in its internal control over financial reporting related to automation and machine lease revenue processes, accounting for converting machines, income taxes, and manual journal entry processes.

Despite these challenges, Ranpak is actively implementing several mitigation strategies to address these risks:

• Focus on Automation: CEO Omar Asali emphasized the company's focus on automation, with plans to 'deliver automation at scale.' Automation revenue grew over 40% in 2024 and is expected to grow over 50% in 2025.
• Strategic Partnerships: A strategic partnership with Amazon is set to drive future growth across multiple geographies.
• Financial Strategy: CFO Bill Drew mentioned plans to generate $20 million in cash in 2025, underscoring the company's financial strategy.
• Sustainability Initiatives: Ranpak is well-positioned to benefit from a shift to more sustainable products within the packaging industry. Its fiber-based products offer lower annual waste and higher recycling rates than plastic and single-use materials.

Here is a summary of Ranpak's financial performance in 2024:

For additional insights into Ranpak Holdings Corp.'s (PACK) financial health, you can explore this resource: Breaking Down Ranpak Holdings Corp. (PACK) Financial Health: Key Insights for Investors

Ranpak Holdings Corp. (PACK) Growth Opportunities

Ranpak Holdings Corp. (PACK) is strategically positioned for future growth through several key drivers. These include product innovations, market expansions, strategic acquisitions, and partnerships. These elements collectively aim to bolster Ranpak's revenue and earnings in the coming years. For additional insights into the company's guiding principles, see: Mission Statement, Vision, & Core Values of Ranpak Holdings Corp. (PACK).

One of the primary growth drivers for Ranpak is its commitment to product innovation. The company continually invests in research and development to create new and improved sustainable packaging solutions. These innovations address evolving customer needs and environmental concerns. By expanding its product offerings, Ranpak can attract new customers and increase its market share. For instance, Ranpak's focus on automation and robotics in packaging solutions enhances efficiency and reduces costs for its clients.

Market expansion is another critical growth avenue for Ranpak. The company strategically targets geographic regions with increasing demand for sustainable packaging. This includes both developed and emerging markets where e-commerce and environmentally conscious consumerism are on the rise. By establishing a stronger presence in these regions, Ranpak diversifies its revenue streams and reduces its dependence on any single market.

Ranpak has also demonstrated a keen interest in growth through acquisitions. By acquiring complementary businesses, Ranpak can expand its product portfolio, gain access to new technologies, and strengthen its market position. Strategic acquisitions enable Ranpak to integrate innovative solutions and broaden its customer base, driving further revenue growth.

Strategic partnerships are integral to Ranpak's growth strategy. Collaborating with other companies allows Ranpak to leverage their expertise, resources, and distribution networks. These partnerships can facilitate market entry, accelerate product development, and enhance the overall value proposition for customers.

While specific future revenue growth projections and earnings estimates are subject to market conditions and company performance, analysts generally expect Ranpak to experience steady growth in the coming years. This growth is supported by the increasing demand for sustainable packaging solutions, driven by both consumer preferences and regulatory pressures.

Ranpak's competitive advantages further position the company for sustained growth:

• Strong Brand Reputation: Ranpak has established a reputable brand known for its commitment to sustainability and innovation.
• Extensive Product Portfolio: The company offers a diverse range of paper-based packaging solutions catering to various industries and applications.
• Global Presence: Ranpak operates in multiple regions worldwide, providing a broad geographic reach and diversification.
• Technological Expertise: Continuous investment in R&D and automation provides a technological edge over competitors.

The following table summarizes some key aspects of Ranpak's strategic initiatives and their potential impact on future growth: