Sealed Air Reports Q4 and Full Year 2025 Results; CD&R Acquisition Update
Sealed Air Reports Q4 and Full Year 2025 Results; Major CD&R Acquisition Progresses
Key Highlights for Investors
- CD&R Acquisition: Sealed Air (NYSE: SEE) shareholders have approved the company’s \$10.3 billion all-cash sale to CD&R, with closing expected in mid-2026 pending regulatory approvals. Each share will be bought for \$42.15 in cash. Upon closing, Sealed Air will become a privately held company and delist from the NYSE.
- Q4 2025 Financial Results:
- Net sales: \$1.40 billion, up 2% as reported; up in both the Protective (+3%) and Food (+2%) segments.
- GAAP Net Earnings: \$44 million, or \$0.30 per diluted share, versus a loss of less than \$1 million in Q4 2024.
- Adjusted EBITDA: \$278 million (19.8% margin), up 2.7% year-on-year.
- Adjusted Net Earnings: \$114 million, or \$0.77 per share.
- Full Year 2025 Results:
- Net sales: \$5.36 billion, down slightly (-0.6%) versus 2024.
- GAAP Net Earnings: \$441 million (\$2.99 per diluted share), up 63.7% from \$270 million (\$1.84 per share) in 2024.
- Adjusted EBITDA: \$1.13 billion (21.2% margin), up 2.1%.
- Free Cash Flow: \$459 million (vs. \$508 million in 2024; \$454 million excluding a 2024 IRS refund).
- Net Debt: Down to \$3.7 billion from \$4.0 billion end-2024; net leverage at 3.2x, improved from 3.6x.
Acquisition by CD&R: Critical Shareholder Update
On November 17, 2025, Sealed Air entered into a definitive agreement to be acquired by funds affiliated with Clayton, Dubilier & Rice (CD&R), a private equity giant with deep industrial and packaging experience. The \$10.3 billion deal values SEE at \$42.15 per share in cash—a significant premium, subject to remaining regulatory approvals and other conditions. Shareholders voted to adopt the merger agreement on February 25, 2026.
The transaction is expected to close in mid-2026, after which Sealed Air will become a private company and its NYSE listing will end. This is a highly price-sensitive event: the certainty and premium embedded in the buyout price, as well as the delisting, will impact trading and investor strategy in the coming months.
Detailed Q4 2025 Financial Performance
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Net Sales: \$1.40 billion, up 2% as reported, driven by a 3% rise in the Protective segment and a 2% increase in Food. On a constant currency basis, net sales fell by 1% (\$10 million), with volumes down less than 1% and pricing flat.
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Income Tax Expense: \$58 million (56.6% effective tax rate), versus \$85 million (100.5% effective rate) a year earlier. Tax rates were affected by IRS audit settlements and accruals for uncertain tax positions.
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Special Items: \$69 million in expenses, mainly transaction costs for the CD&R deal, reduced from \$110 million in Q4 2024. Lower restructuring and tax-related costs contributed to the decrease.
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Segment Results:
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Food Segment: Sales \$937 million (+2% reported, -1% constant currency). Adjusted EBITDA \$202 million (21.6% margin), down 3% due to lower volumes and pricing.
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Protective Segment: Sales \$464 million (+3% reported, +1% constant currency). Adjusted EBITDA \$80 million (17.3% margin), up 21% on cost savings.
Full Year 2025 Results and Analysis
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Net Sales: \$5.36 billion, down less than 1% from 2024, with the Food segment flat and Protective down 2%.
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Net Earnings: \$441 million (\$2.99/diluted share), up 64% from 2024, due to lower tax expense (helped by reversal of tax accruals from IRS resolution), lower interest, and improved operational efficiencies.
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Adjusted EBITDA: \$1.13 billion (21.2% margin), up from \$1.11 billion (20.6%) in 2024; driven largely by cost reductions and productivity initiatives.
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Adjusted Diluted EPS: \$3.34, up 6.4% from \$3.14 in 2024.
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Free Cash Flow: \$459 million (\$454 million excluding the 2024 IRS refund), with capital expenditures falling to \$170 million (from \$220 million in 2024).
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Liquidity and Leverage: \$1.4 billion in liquidity, including \$344 million cash and \$1.06 billion in unused credit lines. Net debt reduced by more than \$350 million, and net leverage improved to 3.2x.
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Dividends: Payments were \$119 million, slightly up from \$118 million in 2024.
Other Financial and Operational Details
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Balance Sheet: Total assets of \$7.01 billion at year-end 2025. Goodwill and intangibles account for over \$3.2 billion.
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Cash Flow:
- Operating cash flow: \$628 million (down from \$728 million in 2024).
- Capital expenditures: \$170 million (down from \$220 million).
- Net cash used in financing: \$568 million, reflecting debt repayments and dividend payouts.
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Non-GAAP Metrics: Management highlights Adjusted EBITDA, free cash flow, and adjusted EPS as key indicators. These exclude special items such as restructuring, acquisition costs, and one-off tax events.
Forward-Looking Statements and Risks
The company cautions that the CD&R acquisition is subject to regulatory approvals and other closing conditions. Risks include potential delays or failure to close, changes in market conditions, litigation, impacts to customer and employee retention, and possible adverse effects on the share price if the deal does not complete. Broader economic risks such as monetary policy changes, supply chain issues, and raw material pricing also remain.
Summary for Shareholders
The most significant price-sensitive event is the pending \$10.3 billion CD&R acquisition. With a fixed cash offer of \$42.15 per share and shareholder approval, SEE’s trading price is anchored by deal certainty and the timeline for closing. Investors should monitor regulatory processes and any news related to deal completion or potential delays. The company’s improved operational metrics and cash flow support the valuation, but the stock will delist upon closing.
Company Contacts
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially. Investors should review Sealed Air’s SEC filings and consult their financial advisor before making investment decisions.
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