Star Metro - CCL Industries Announces Record Results for 2026 Second Quarter

TORONTO, ON / ACCESS Newswire / August 12, 2026 / CCL Industries Inc. (TSX:CCL.A)(TSX:CCL.B) ("the Company"), a world leader in specialty label, security and packaging solutions for global corporations, government institutions, small businesses and consumers, today reported 2026 second quarter results.

Sales for the second quarter of 2026 increased 9.1% to $2,110.2 million, compared to $1,934.6 million for the second quarter of 2025, with organic growth of 5.0%, acquisition-related growth of 1.8% and a 2.3% positive impact from foreign currency translation.

Operating income⁽¹⁾ for the second quarter of 2026 improved 8.8% to $350.6 million compared to $322.1 million for the comparable quarter of 2025. Foreign currency translation had a 2.2% positive impact on operating income for the comparable quarters.

The Company recorded an expense for restructuring and other items of $5.2 million, primarily attributable to severance costs across its European operations, including the newly acquired Sleever, compared to $0.7 million principally related to severance costs at Checkpoint in the 2025 second quarter.

Tax expense for the second quarter of 2026 was $78.4 million compared to $71.4 million in the prior year period. The effective tax rate for the 2026 second quarter was 26.0% compared to 25.3% for the 2025 second quarter due to a higher portion of the Company's taxable income earned in higher tax jurisdictions.

Net earnings were $223.8 million for the 2026 second quarter compared to $213.1 million for the 2025 second quarter. Basic and adjusted basic earnings per Class B share⁽³⁾ for the 2026 second quarter were $1.31 and $1.35, respectively, compared to basic and adjusted basic earnings per Class B share⁽³⁾ of $1.21 and $1.22, respectively, in the prior year second quarter. Foreign currency translation had a positive impact of $0.03 on adjusted basic earnings per Class B share.

For the six-month period ended June 30, 2026, sales, operating income⁽¹⁾ and net earnings improved 6.0%, 4.6% and 2.0% to $4.0 billion, $668.1 million and $428.7 million, respectively, compared to the same six-month period in 2025. The 2026 six-month period included results from four acquisitions completed since January 1, 2025, delivering acquisition-related sales growth of 1.1%. Organic sales growth was 3.5% and foreign currency translation had a positive 1.4% impact. For the six-month period ended June 30, 2026, basic and adjusted basic earnings per Class B share⁽³⁾ were $2.49 and $2.55, respectively, compared to basic and adjusted basic earnings per Class B share⁽³⁾ of $2.39 and $2.40, respectively, in the prior year six-month period. Foreign currency translation had a positive impact of $0.03 on adjusted basic earnings per Class B share.

Geoffrey T. Martin, President and Chief Executive Officer, commented, "Given the geopolitical conditions in the Middle East and the corresponding inflationary pressures, I'm pleased with our performance. Profitability improvement was driven by strong gains for the CCL and Innovia Segments with a solid result at Avery largely offset by a decline at Checkpoint summing to the Company posting a record $1.35 adjusted basic earnings per Class B share⁽³⁾ for the quarter compared to $1.22 in the prior year period."

Mr. Martin stated, "The CCL Segment delivered 3.7% organic sales growth with strong profitability improvement. Home & Personal Care sales and profitability increased on improvements across all label geographies (except Latin America) offsetting reduced results for tubes that continues to be impacted by slow high-end beauty markets; volume for aluminum bottles and aerosols was flat but revenue rose significantly on escalating metal cost passed on to customers. Improved results for Healthcare & Specialty were driven by solid gains in Healthcare, partially offset by lower demand from global AgChem markets impacted by the conflict in the Middle East. Food & Beverage sales and profitability improved in all categories: sleeves, pressure sensitive labels and closures, augmented by good results for the newly acquired Sleever business in its first month of ownership. Soft automotive and industrial markets modestly offset solid results in electronics markets for CCL Design. CCL Secure results improved on strong demand for banknote substrate."

Mr. Martin continued, "Avery profits improved on a calmer back-to-school start in North America compared to the tariff-related chaos we faced in the prior year period. Direct-to-consumer results remained strong, aided by promotions for the World Cup. Checkpoint's results declined on reduced customer demand and a change in sales mix at MAS customers, especially in the United States, partly offset by modestly improved sales and profitability in Apparel Labeling, including gains for RFID. Innovia posted volume and profit gains driven by strong performance in Poland for label films, including EcoFloat, exceptional results in the Americas and a marked reduction of start-up losses for the new plant in Germany. We believe part of the demand strength was fueled by customer inventory build in the label industry for supply chain security and price increase avoidance driven by the situation in the Middle East."

Mr. Martin added, "Foreign currency translation had a $0.03 positive impact on adjusted earnings per Class B share for the second quarter of 2026. At today's Canadian dollar exchange rates, currency translation impact would be a modest tailwind to earnings, if sustained, for the third quarter of 2026."

Mr. Martin concluded, "The Company again delivered strong free cash flow this quarter, finishing the period with a consolidated leverage ratio⁽⁵⁾ of just 1.05 times Adjusted EBITDA⁽²⁾, despite returning $455.1 million to shareholders in dividends and share repurchases under its Normal Course Issuer Bid in the first six months of 2026. With $975.6 million cash-on-hand and US$1.25 billion undrawn capacity inclusive of our syndicated revolving credit facility and new syndicated undrawn term loan we are well placed to manage current debt maturities and fund global expansion initiatives. The Board of Directors declared the quarterly dividend at $0.36 per Class B non-voting share and $0.3575 per Class A voting share, payable to shareholders of record at the close of business on September 15, 2026, to be paid on September 29, 2026."

2026 Second Quarter Highlights

CCL

• Sales increased 9.0% to $1,340.2 million on 3.7% organic growth, 2.4% acquisition contribution and 2.9% positive impact from foreign currency translation

• Regional organic sales growth: mid-single digit in North America and Asia Pacific and low-single digit in Europe and Latin America

• Operating income⁽¹⁾ $226.1 million, up 10.7%, 16.9% operating margin⁽¹⁾ up 30 bps

Avery

• Sales increased 7.9% to $287.2 million on 4.0% organic growth, 2.4% acquisition contribution and 1.5% positive impact from foreign currency translation

• Operating income⁽¹⁾ $55.0 million, up 8.7%, 19.2% operating margin⁽¹⁾, up 20 bps

Checkpoint

• Sales decreased 1.8% to $251.0 million due to an organic decline of 2.7% partially offset by 0.9% positive impact from foreign currency translation

• Operating income⁽¹⁾ $34.7 million, down 20.2%, 13.8% operating margin⁽¹⁾, down 320 bps

Innovia

• Sales improved 26.5% to $231.8 million due to 25.5% organic growth and 1.0% positive impact from foreign currency translation

• Operating income⁽¹⁾ $34.8 million, up 46.8%, 15.0% operating margin⁽¹⁾, up 210 bps

The Company will hold a live webcast call at 7:30 a.m. ET on August 13, 2026, to discuss these results.

The quarterly results review presentation, including outlook commentary, is posted on the Company's website at https://www.cclind.com/investors/investor-presentations/

To access the webcast or webcast replay, please use the following webcast link:

https://www.webcaster5.com/Webcast/Page/2807/54279

To access the audio/listen only live webcast, please use the following numbers:

Toll Free: 1-877-545-0320
International: 1-973-528-0002
Conference Entry Code (CEC): 271339

Replay for the webcast will be available Thursday, August 13, 2026, until Sunday, September 13, 2026.

For more information on CCL, visit our website - www.cclind.com or contact:

Sean Washchuk
Senior Vice President and Chief Financial Officer
416-756-8526

Forward-looking Statements

This press release contains forward-looking information and forward-looking statements, as defined under applicable securities laws, (hereinafter collectively referred to as "forward-looking statements") that involve a number of risks and uncertainties. Forward-looking statements include all statements that are predictive in nature or depend on future events or conditions. Forward-looking statements are typically identified by the words "believes," "expects," "anticipates," "estimates," "intends," "plans" or similar expressions. Statements regarding the operations, business, financial condition, priorities, ongoing objectives, strategies and outlook of the Company, other than statements of historical fact, are forward-looking statements. Specifically, this press release contains forward-looking statements regarding the adequacy of the Company's financial liquidity including the availability of sufficient cash from operations and available credit capacity to fund the Company's future financial obligations for the next few years; and the Company's expectations regarding general business and economic conditions.

Forward-looking statements are not guarantees of future performance. They involve known and unknown risks and uncertainties relating to future events and conditions including, but not limited to, the impact of competition; consumer confidence and spending preferences; general economic and geopolitical conditions; currency exchange rates; interest rates and credit availability; technological changes; changes in government regulations; risks associated with operating and product hazards; and the Company's ability to attract and retain qualified employees. Do not unduly rely on forward-looking statements as the Company's actual results could differ materially from those anticipated in these forward-looking statements. Forward-looking statements are also based on a number of assumptions, which may prove to be incorrect, including, but not limited to, assumptions about the following: consumer spending; customer demand for the Company's products; market growth in specific sectors and entrance into new markets; the Company's ability to provide a wide range of products to multinational customers on a global basis; the benefits of the Company's focused strategies and operational approach; the achievement of the Company's plans for improved efficiency and lower costs, including stable aluminum and resin costs; the availability of cash and credit; fluctuations of currency exchange rates; the Company's continued relations with its customers; and economic conditions. Should one or more risks materialize or should any assumptions prove incorrect, then actual results could vary materially from those expressed or implied in the forward-looking statements. Further details on key risks can be found in the 2025 Annual Report, Management's Discussion and Analysis, particularly under Section 4: "Risks and Uncertainties." CCL Industries Inc.'s annual and quarterly reports can be found online at www.cclind.com and www.sedarplus.ca or are available upon request.

Except as otherwise indicated, forward-looking statements do not take into account the effect that transactions or non-recurring or other special items announced or occurring after the statements are made may have on the Company's business. Such statements do not, unless otherwise specified by the Company, reflect the impact of dispositions, sales of assets, monetizations, mergers, acquisitions, other business combinations or transactions, asset write-downs or other charges announced or occurring after forward-looking statements are made. The financial impact of these transactions and non-recurring and other special items can be complex and depend on the facts particular to each of them and therefore cannot be described in a meaningful way in advance of knowing specific facts. The forward-looking statements are provided as of the date of this press release and the Company does not assume any obligation to update or revise the forward-looking statements to reflect new events or circumstances, except as required by law.

The financial information presented herein has been prepared on the basis of IFRS for financial statements and is expressed in Canadian dollars unless otherwise stated.

Financial Information

CCL Industries Inc.
Consolidated condensed interim statements of financial position
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CCL Industries Inc.
Consolidated condensed interim income statements
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CCL Industries Inc.
Consolidated condensed interim statements of cash flows
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CCL Industries Inc.
Segment Information
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In millions of Canadian dollars

Non-IFRS Measures

⁽¹⁾ Operating income and operating income margin are key non-IFRS financial measures used to assist in understanding the profitability of the Company's business units. Operating income is defined as earnings before corporate expenses, net finance cost, goodwill impairment loss, earnings in equity accounted investments, restructuring and other items, and taxes. Operating income margin, also known as return on sales, is defined as operating income over sales.

⁽²⁾ Adjusted EBITDA is a critical non-IFRS financial measure used extensively in the packaging industry and other industries to assist in understanding and measuring operating results. Adjusted EBITDA is also considered as a proxy for cash flow and a facilitator for business valuations. This non-IFRS financial measure is defined as earnings before net finance cost, taxes, depreciation and amortization, goodwill impairment loss, non-cash acquisition accounting adjustments to inventory, earnings in equity accounted investments and restructuring and other items. Calculations are provided below to reconcile operating income to Adjusted EBITDA. The Company believes that this is an important measure as it allows management to assess the ongoing business without the impact of net finance cost, depreciation and amortization and income tax expenses, as well as non-operating factors and one-time items. As a proxy for cash flow, it is intended to indicate the Company's ability to incur or service debt and to invest in property, plant and equipment, and it allows management to compare the business to those of the Company's peers and competitors who may have different capital or organizational structures. Adjusted EBITDA is tracked by financial analysts and investors to evaluate financial performance and is a key metric in business valuations. It is considered an important measure by lenders to the Company and is included in the financial covenants included in the senior notes and bank lines of credit.

Reconciliation of operating income to Adjusted EBITDA

Unaudited

⁽³⁾ Adjusted basic earnings per Class B share is an important non-IFRS measure to assist in understanding the ongoing earnings performance of the Company excluding items of a one-time or non-recurring nature. It is not considered a substitute for basic net earnings per Class B share but it does provide additional insight into the ongoing financial results of the Company. This non-IFRS financial measure is defined as basic net earnings per Class B share excluding gains on business dispositions, goodwill impairment loss, non-cash acquisition accounting adjustments to inventory, restructuring and other items, and tax adjustments.

Reconciliation of Basic Earnings per Class B Share to Adjusted Basic Earnings per Class B Share

Unaudited

⁽⁴⁾ Free Cash Flow from Operations - A measure indicating the relative amount of cash generated by the Company during the year and available to fund dividends, debt repayments, share buybacks and acquisitions. It is calculated as cash flow from operations less capital expenditures, net of proceeds from the sale of property, plant and equipment.

The following table reconciles the measure of free cash flow from operations to IFRS measures reported in the consolidated condensed interim statements of cash flows for the periods ended as indicated.

⁽⁵⁾ Leverage ratio is a measure that indicates the Company's ability to service its existing debt. Leverage ratio is calculated as net debt divided by Adjusted EBITDA.

Supplemental Financial Information

Sales Change Analysis (%)

Business Description

CCL Industries Inc. employs approximately 26,000 people operating 214 production facilities in 42 countries with corporate offices in Toronto, Canada, and Framingham, Massachusetts. CCL is the world's largest converter of pressure sensitive and specialty extruded film materials for a wide range of decorative, instructional, functional and security applications for government institutions and large global customers in the consumer packaging, healthcare & chemicals, consumer electronic device and automotive markets. Extruded & laminated plastic tubes, aluminum aerosols & specialty bottles, folded instructional leaflets, precision decorated & die cut components, electronic displays, polymer banknote substrate and other complementary products and services are sold in parallel to specific end-use markets. Avery is the world's largest supplier of labels, specialty converted media and software solutions for short-run digital printing applications for businesses and consumers available alongside complementary products sold through distributors, mass market stores and e-commerce retailers. Checkpoint is a leading developer of RF and RFID-based technology systems for enterprise wide inventory accuracy, reliability and security, including labeling and tagging solutions, for the broad retail, apparel, consumer products and technology industries worldwide. Innovia is a leading global producer of specialty, high-performance, multi-layer, surface-engineered films for label, packaging and security applications. The Company is partly backward integrated into materials science with capabilities in polymer extrusion, adhesive development, coating & lamination, surface engineering and metallurgy; deployed as needed across the four business segments.

SOURCE: CCL Industries Inc.

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L.Pelletier--SMC