Packaging Corporation of America Reports 7.4% Net Sales Increase to $8.4 Billion for Fiscal Year 2024

Packaging Corporation of America (PCA) reported a net sales increase of 7.4% for the fiscal year ending December 31, 2024, reaching $8.4 billion, compared to $7.8 billion in 2023. The company’s net income also rose to $805 million, or $8.93 per diluted share, up from $765 million, or $8.48 per diluted share, in the previous year. The increase in profitability was attributed to higher volumes in both the Packaging and Paper segments, alongside reduced freight and logistics expenses. However, these gains were partially offset by lower prices and a less favorable product mix, as well as increased operating costs driven by inflation.

In terms of operational performance, PCA's Packaging segment generated $7.7 billion in sales, a 7.8% increase from the prior year, primarily due to a 10.5% rise in total corrugated products shipments. The segment's operating income was $1.1 billion, slightly up from $1.07 billion in 2023. The Paper segment also saw growth, with sales increasing by 4.9% to $625 million, driven by higher volumes despite a decline in prices. The company produced approximately 294 billion square feet of containerboard in 2024, maintaining a strong production capacity of 301 billion square feet.

PCA has made significant capital investments to enhance productivity and efficiency across its operations, particularly in the Packaging segment. The company has focused on optimizing its containerboard mills and corrugated products facilities, which has contributed to its ability to manage inflationary pressures. As of December 31, 2024, PCA employed approximately 15,400 individuals, with about 60% of its hourly workforce covered by collective bargaining agreements. The company has not experienced significant disruptions in operations despite facing labor shortages and turnover in certain facilities.

Looking ahead, PCA anticipates continued growth in its Packaging segment, with expectations for record-setting volumes in the first quarter of 2025. The company has announced price increases for its products, which are expected to positively impact revenue. However, PCA also foresees challenges, including higher costs for wood, energy, and chemicals, as well as inflation across various operational expenses. The company remains committed to maintaining its operational efficiency and managing costs effectively to sustain profitability in a competitive market environment.