• Packaging System placement up 3.8% year over year to approximately 139,600 machines at March 31, 2023
• First quarter net revenue decreased 1.6% year over year to $81.2 million and increased 1.1% year over year on a constant currency basis to $84.8 million
• First quarter net loss of $12.4 million compared to net loss of $14.1 million
• First quarter constant currency Adjusted EBITDA (“AEBITDA”) of $15.1 million down 20.9%, or $4.0 million, year over year

Ranpak Holdings Corp (NYSE: PACK) (“Ranpak” or “the Company”), a leading provider of environmentally sustainable, systems-based, product protection solutions for e-Commerce and industrial supply chains, today reported its first quarter 2023 financial results.

Omar Asali, Chairman and Chief Executive Officer, commented, “We consider the results of the first quarter a step in the right direction on the path towards Ranpak getting back on track after a challenging 2022. We finished the first quarter in line with our previous communication growing sales slightly from the first quarter of last year on a constant currency basis and finishing just below where we were in 1Q21. The improving input cost environment provided a boost to gross margins year over year and sequentially from the fourth quarter trough. We expect this trend to continue throughout the year. We are committed to regaining our attractive financial profile and right sizing our price / cost structure is paramount to achieving that goal. Our Adjusted EBITDA was under pressure from the first quarter of last year as we have some work to do to better align our cost structure with our top-line, but did improve sequentially from the fourth quarter on a similar revenue profile.”

“The year started off largely in-line with expectations but we are turning more cautious as consumer confidence has moved lower and industrial activity has slowed in response to the higher rate environment and reduction in credit availability due to banking stress. On a positive note, the input cost environment is more favorable than we anticipated when we started the year, providing some offset to potential top-line pressure in the near term. At the same time we are pulling back on planned spend until the environment provides more clarity.”

“We have made tremendous investments and changes to the business over the past couple of years and are at a point in our lifecycle now where we can focus on productivity and efficiency improvements without major distractions. I believe we will emerge from this period a much stronger company with even greater ability to service our customers’ needs.”

First Quarter 2023 Highlights

• Packaging systems placement increased 3.8% year over year, to approximately 139,600 machines as of March 31, 2023
• Net revenue decreased 1.6% and increased 1.1% adjusting for constant currency
• Net loss of $12.4 million compared to net loss of $14.1 million
• Constant currency AEBITDA¹ of $15.1 million for the three months ended March 31, 2023 is down 20.9%

Net revenue for the first quarter of 2023 was $81.2 million compared to net revenue of $82.5 million in the first quarter of 2022, a decrease of $1.3 million or 1.6% year over year. Net revenue was negatively impacted by decreases in void-fill and wrapping, partially offset by increases in cushioning and other products. In addition to currency headwinds, which contributed 2.7 points of pressure, revenue was negatively affected by increased business sponsoring costs; lower economic activity; and the impact inflationary pressures are having on consumer and corporate budgets. Cushioning increased $2.0 million, or 5.6%, to $37.6 million

from $35.6 million; void-fill decreased $1.6 million, or 5.0%, to $30.2 million from $31.8 million; wrapping decreased $1.7 million, or 15.5%, to $9.3 million from $11.0 million; and other sales were flat at $4.1 million for the first quarter of 2023 compared to the first quarter of 2022. Other net revenue includes automated box sizing equipment and non-paper revenue from packaging systems installed in the field, such as systems accessories. The decrease in net revenue is quantified by a decrease in the volume of sales of our paper consumable products of approximately 3.5 percentage points (“pp”), partially offset by a 4.2 pp increase in the price or mix of our paper consumable products, and an increase of 0.3 pp in sales of automated box sizing equipment. Constant currency net revenue was $84.8 million for the first quarter of 2023, a 1.1% increase from constant currency net revenue of $83.9 million for the first quarter of 2022.

Net revenue in North America for the first quarter of 2023 totaled $31.1 million compared to net revenue in North America of $30.9 million in the first quarter of 2022. The increase of $0.2 million, or 0.6%, was primarily attributable to increases in cushioning, void-fill, and other sales, partially offset by decreases in wrapping sales.

Net revenue in Europe/Asia for the first quarter of 2023 totaled $50.1 million compared to net revenue in Europe/Asia of $51.6 million in the first quarter of 2022. The decrease of $1.5 million, or 2.9%, was driven by lower void-fill, wrapping, and other sales as well as currency headwinds, partially offset by increases in cushioning sales. Constant currency net revenue in Europe/Asia was $53.7 million for the first quarter of 2023, a $0.7 million, or 1.3%, increase from constant currency net revenue of $53.0 million for the first quarter of 2022.

Net loss for the first quarter of 2023 decreased $1.7 million to $12.4 million from a net loss of $14.1 million in the first quarter of 2022.

Balance Sheet and Liquidity

Ranpak completed the first quarter of 2023 with a strong liquidity position, including a cash balance of $58.6 million and no borrowings on its $45 million Revolving Credit Facility. As of May 4, 2023, the Company had First Lien Term Loan facilities outstanding consisting of a $250.0 million USD-denominated term loan and €135.1 million euro-denominated term loan resulting in an Adjusted EBITDA net leverage ratio of 5.7x based on results on a constant currency basis through the first quarter of 2023. The Bank Adjusted EBITDA net leverage ratio was 5.2x through the first quarter of 2023. The First Lien Term Loan facilities are the only debt facilities outstanding and mature in June 2026.

The following table presents Ranpak’s installed base of protective packaging systems by product line as of March 31, 2023 and 2022:

Conference Call Information

The Company will host a conference call and webcast at 8:30 a.m. (ET) on Thursday, May 4, 2023. The conference call and earnings presentation will be webcast live at the following link: https://events.q4inc.com/attendee/561171603. Investors who cannot access the webcast may listen to the conference call live via telephone by dialing (888) 330-2446 or (240) 789-2732 and use the Conference ID: 8498994.

A telephonic replay of the webcast also will be available starting at 11:30 a.m. (ET) on Thursday, May 4, 2023 and ending at 11:59 p.m. (ET) on Thursday, May 11, 2023. To listen to the replay, please dial (800) 770-2030 or (647) 362-9199 and use the passcode: 8498994.

Note Regarding Forward-Looking Statements

This news release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. Statements that are not historical facts, including statements about the parties, perspectives and expectations, are forward-looking statements. In addition, any statements that refer to estimates, projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this news release include, for example, statements about our expectations around the future performance of the business, including our forward-looking guidance.

The forward-looking statements contained in this news release are based on our current expectations and beliefs concerning future developments and their potential effects on us taking into account information currently available to us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks include, but are not limited to: (i) our inability to secure a sufficient supply of paper to meet our production requirements; (ii) the impact of the price of kraft paper on our results of operations; (iii) our reliance on third party suppliers; (iv) the COVID-19 pandemic, the Russia and Ukraine conflict, and associated responses; (v) the high degree of competition in the markets in which we operate; (vi) consumer sensitivity to increases in the prices of our products; (vii) changes in consumer preferences with respect to paper products generally; (viii) continued consolidation in the markets in which we operate; (ix) the loss of significant end-users of our products or a large group of such end-users; (x) our failure to develop new products that meet our sales or margin expectations; (xi) our future operating results fluctuating, failing to match performance or to meet expectations; (xii) our ability to fulfill our public company obligations; (xiii) our exposure to changes in interest rates; and (xiv) other risks and uncertainties indicated from time to time in filings made with the SEC.

Should one or more of these risks or uncertainties materialize, they could cause our actual results to differ materially from the forward-looking statements. We are not undertaking any obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. You should not take any statement regarding past trends or activities as a representation that the trends or activities will continue in the future. Accordingly, you should not put undue reliance on these statements.

Non-GAAP Financial Data

In this press release, we present Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) and constant currency EBITDA and constant currency adjusted EBITDA (“Constant currency AEBITDA”), which are non-GAAP financial measures. We have included EBITDA, constant currency EBITDA and AEBITDA because they are key measures used by our management and Board of Directors to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating EBITDA, constant currency EBITDA and constant currency AEBITDA can provide a useful measure for period-to-period comparisons of our primary business operations.

However, EBITDA, constant currency EBITDA and constant currency AEBITDA have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. In particular, EBITDA, constant currency EBITDA and constant currency AEBITDA should not be viewed as substitutes for, or superior to, net income (loss) prepared in accordance with GAAP as a measure of profitability or liquidity. Some of these limitations are:

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and EBITDA, constant currency EBITDA and constant currency AEBITDA do not reflect all cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
• EBITDA, constant currency EBITDA and constant currency AEBITDA do not reflect changes in, or cash requirements for, our working capital needs;
• constant currency AEBITDA does not consider the potentially dilutive impact of equity-based compensation;
• EBITDA, constant currency EBITDA and constant currency AEBITDA do not reflect the impact of the recording or release of valuation allowances or tax payments that may represent a reduction in cash available to us;
• constant currency AEBITDA does not take into account any restructuring and integration costs;
• constant currency EBITDA and constant currency AEBITDA are presented on constant currency basis and give effect to the impact of currency fluctuations; and;
• other companies, including companies in our industry, may calculate EBITDA, constant currency EBITDA and constant currency AEBITDA differently, which reduces their usefulness as comparative measures.

EBITDA — EBITDA is a non-GAAP financial measure that we calculate as net income (loss), adjusted to exclude: benefit from (provision for) income taxes; interest expense; and depreciation and amortization.

Constant currency EBITDA — Constant currency EBITDA is a non-GAAP financial measure that we present on a constant currency basis and we calculate as net income (loss), adjusted to exclude: benefit from (provision for) income taxes; interest expense; and depreciation and amortization.

Constant currency AEBITDA — Constant currency AEBITDA is a non-GAAP financial measure that we calculate as net income (loss), adjusted to exclude: benefit from (provision for) income taxes; interest expense; depreciation and amortization; stock-based compensation expense; and, in certain periods, certain other income and expense items; as further adjusted to reflect the performance of the business on a constant currency basis.

We present constant currency EBITDA and constant currency AEBITDA on a constant currency basis because it allows a better insight into the performance of our businesses that operate in currencies other than our reporting currency. Before consolidation, our Europe/Asia financial data is derived in Euros. To calculate the adjustment that we apply to present constant currency EBITDA and constant currency AEBITDA on a constant currency basis, we multiply this Euro-derived data by 1.15 to reflect an exchange rate of 1 Euro to 1.15 U.S. dollars (“USD”), which we believe is a reasonable exchange rate to use to give a stable depiction of the business without currency fluctuations between periods, to calculate Europe/Asia data in constant currency USD. We believe that using an exchange rate of 1.15 is reasonable because it approximates the average exchange rate of the Euro to USD over the past five years. In addition, we include certain other unaudited, non-GAAP constant currency data for the three months ended March 31, 2023 and 2022. This data is based on our historical financial statements, adjusted (where applicable) to reflect a constant currency presentation between periods for the convenience of readers. We reconcile this data to our GAAP data for the same period for the three months ended March 31, 2023 and 2022.

This press release also includes forecasts for certain non-GAAP metrics. We are unable to provide a reconciliation of our forecast of net revenue on a constant currency basis for 2023 to a forecast of net revenue on a GAAP basis without unreasonable effort primarily because we are unable to forecast with reasonable certainty the associated currency impact. In addition, a reconciliation of our forecast for constant currency AEBITDA for 2023 to GAAP net income cannot be provided without unreasonable effort because we are unable to forecast with reasonable certainty several of the items necessary to calculate such comparable GAAP measure, including asset impairments, integration related expenses, reorganizations and discontinued operations related expenses, legal settlement costs, constant currency adjustments, as well as other unusual or non-recurring gains or losses. These items are uncertain, depend on various factors, and could be material to our results computed in accordance with GAAP. We believe the inherent uncertainties in reconciling such non-GAAP measures for projected periods to the most comparable GAAP measures would make the forecasted comparable GAAP measures difficult to predict with reasonable certainty or reliability.

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