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SON Sonoco Products

Filed: 30 Mar 21, 12:31pm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): March 30, 2021
 
SONOCO PRODUCTS COMPANY
 Commission File No. 001-11261
 
Incorporated under the lawsI.R.S. Employer Identification
of South CarolinaNo. 57-0248420
1 N. Second St.
Hartsville, South Carolina 29550
Telephone: 843/383-7000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
No par value common stockSONNew York Stock Exchange, LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company    
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act.





Section 8-Other Events
Item 8.01    Other Events

As previously disclosed, Sonoco Products Company (the "Company") changed its operating and reporting structure in January 2021 and, as a result, realigned certain of its reportable segments effective January 1, 2021. The revised structure consists of two reportable segments, Consumer Packaging and Industrial Paper Packaging, with all remaining businesses reported as "All Other." The Company's former Protective Solutions and Display and Packaging segments have been eliminated and the underlying businesses and their results have been reallocated into All Other or, in certain cases, subsumed into the remaining two segments. Changes to the Consumer Packaging segment include moving the TEQ healthcare packaging and Industrial Plastics business units to All Other. The Industrial Paper Packaging segment, previously called Paper and Industrial Converted Products, remains unchanged except that it now includes the Company's fiber protective packaging business unit which was previously included in the Protective Solutions segment. All Other includes our healthcare and protective packaging businesses, including TEQ, Sonoco ThermoSafe, consumer and automotive molded foam, Alloyd retail security, and the U.S. Display and Packaging business units.

The Company is providing in this Form 8-K revisions to the segment information previously presented in the footnotes to the consolidated financial statements for each quarter of 2020 and 2019 and the full years ended December 31, 2020 and 2019, in order to reflect the new segment structure. The Current Report does not reflect events occurring subsequent to the filing of the 2020 Form 10-K and does not modify or update the disclosures therein in any way, other than as required to reflect the change in segments as described above. Beginning in 2021, Sonoco's financial statements will reflect the realignment of its reportable segments with prior periods adjusted accordingly. The information in this Form 8-K should be read in conjunction with the 2020 Form 10-K and our subsequent filings with the SEC.

The following tables set forth the Company's financial results by quarter and full year under the new reportable segment structure for the historical periods within and for 2020 and 2019:

Quarterly Reportable Segment Results (Unaudited)
2020
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Full Year
Net sales:
Consumer Packaging$540,569 $573,167 $546,208 $569,915 $2,229,859 
Industrial Paper Packaging502,491 455,025 490,368 543,590 1,991,474 
All Other260,236 217,293 275,738 262,843 1,016,110 
Consolidated$1,303,296 $1,245,485 $1,312,314 $1,376,348 $5,237,443 
Intersegment sales1:
Consumer Packaging$1,106$1,154$919$1,254$4,433
Industrial Paper Packaging24,50224,50824,52825,71999,257
All Other2,6821,4751,8141,9797,950
Consolidated$28,290$27,137$27,261$28,952$111,640
Operating profit:
Segment operating profit2:
Consumer Packaging$63,756 $84,456 $64,370 $65,862 $278,444 
Industrial Paper Packaging59,601 33,229 41,034 42,945 176,809 
All Other20,555 8,871 25,137 17,173 71,736 
Restructuring/Asset impairment charges(12,599)(22,885)(24,149)(85,950)(145,583)
Other, net(1,210)56 352 (22,803)(23,605)
Consolidated operating profit$130,103$103,727$106,744$17,227$357,801 





Quarterly Reportable Segment Results (Unaudited)
2019
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Full Year
Net sales:
Consumer Packaging$555,865 $570,630 $551,113 $530,966 $2,208,574 
Industrial Paper Packaging528,030 523,668 526,420 519,762 2,097,880 
All Other267,810 265,423 276,398 258,122 1,067,753 
Consolidated$1,351,705 $1,359,721 $1,353,931 $1,308,850 $5,374,207 
Intersegment sales1:
Consumer Packaging$774 $1,004 $1,307 $2,215 $5,300 
Industrial Paper Packaging25,590 24,660 27,757 32,984 110,991 
All Other2,875 2,582 2,513 2,773 10,743 
Consolidated$29,239 $28,246 $31,577 $37,972 $127,034 
Operating profit:
Segment operating profit2:
Consumer Packaging$55,729 $57,195 $52,237 $42,247 $207,408 
Industrial Paper Packaging55,336 68,057 66,153 55,436 244,982 
All Other16,895 19,083 20,677 16,347 73,002 
Restructuring/Asset impairment charges(10,672)(13,355)(6,615)(29,238)(59,880)
Other, net(400)(1,212)6,096 (2,914)1,570 
Consolidated operating profit$116,888 $129,768 $138,548 $81,878 $467,082 

1Intersegment sales are recorded at a market-related transfer price. Due to reclassifications of certain businesses within our reportable segments and All Other, certain intersegment sales are now intrasegment sales and thus totals for intersegment sales will differ from previously disclosed amounts.

2"Segment operating profit" is defined as the segment's portion of "Operating profit" excluding restructuring and asset impairment charges, acquisition and disposition-related expenses, interest income and expense, income taxes or certain other items, if any, the exclusion of which the Company believes improves comparability and analysis of the financial performance of the business. General corporate expenses have been allocated as operating costs to each of the Company's reportable segments and to the businesses included in All Other.




















The following table sets forth financial information about each of the Company's new reportable segments and "All Other" for the years ended December 31, 2020 and 2019:
Years ended December 31 (Unaudited)
Consumer
Packaging
Industrial
Paper
Packaging
All
Other
CorporateConsolidated
Total Revenue
2020$2,234,292 2,090,731 $1,024,060 $— $5,349,083 
20192,213,874 2,208,871 1,078,496 — 5,501,241 
Intersegment Sales1
2020$4,433 $99,257 $7,950 $— $111,640 
20195,300 110,991 10,743 — 127,034 
Sales to Unaffiliated Customers
2020$2,229,859 $1,991,474 $1,016,110 $— $5,237,443 
20192,208,574 2,097,880 1,067,753 — 5,374,207 
Income Before Income Taxes2
2020$278,443 $176,809 $71,737 $(271,397)$255,592 
2019207,408 244,982 73,002 (144,626)380,766 
Depreciation, Depletion and Amortization3
2020$109,310 94,801 $51,248 $— $255,359 
2019107,948 86,861 44,331 — 239,140 
Capital Expenditures
2020$59,040 $87,549 $24,701 $22,837 $194,127 
201961,787 112,852 14,204 7,091 195,934 

1Intersegment sales are recorded at a market-related transfer price. Due to reclassifications of certain businesses within our reportable segments and All Other, certain intersegment sales are now intrasegment sales and thus totals for intersegment sales will differ from previously disclosed amounts.
2Included in Corporate above are interest expense, interest income, restructuring/asset impairment charges, property insurance settlement gains, non-operating pension costs, acquisition-related charges, and other non-operational income and expenses associated with the following segments and the businesses included in All Other:
Consumer
Packaging
Industrial
Paper
Packaging
All
Other
CorporateTotal
2020$100,166 $33,450 $27,835 $109,946 $271,397 
201940,831 5,4911,82896,476144,626 
The remaining amounts reported as Corporate consist of interest expense, interest income, non-operating pension costs, and other non-operational income and expenses not associated with a particular segment.
3Depreciation, Depletion and Amortization incurred in Corporate is allocated to the reportable segments and the businesses in All Other.








SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
SONOCO PRODUCTS COMPANY
Date: March 30, 2021By:/s/ Julie C. Albrecht
Julie C. Albrecht
Vice President and Chief Financial Officer