SW – Takeaway from Investor Meetings: Strong North American Demand; SBS Improvement; Europe a Cost Story

Research evidence excerpt

SW – Takeaway from Investor Meetings: Strong North American Demand; SBS Improvement; Europe a Cost Story

t 5.6% is largely demand driven in a tight-capacity market, with potential for margin expansion later

Dividend/Yield $1.81/4.8% in the year assuming it is recognized in the index in July and flows through the box plants

Enterprise Value ($M) $33,171 in late 3Q to 4Q. Recall that implementation of a portion of the June $50/ton is included in

Cash & Equivalents ($M) $674 the full-year guide.

Total Debt ($M) $14,255

Corrugated plant margins have increased from a few percent negative to a few percent

positive since SW purchased legacy WestRock given the continued pruning of unprofitable

5 Page Document business and P&L ownership at the plant level. In fairness, some of the margin improvement

thus far is a result of an improving market backdrop, and it is our sense that some mills and

plants still need more time to build out local sales capabilities. Additionally, while SW may

Reasons for this report enter into some less profitable business to fill assets and avoid the margin hit from slack

capacity, those contracts will be short duration. The company reiterated its confidence in the

✓ NDR Recap legacy WestRock assets, with labor and operational expertise being the primary bottlenecks

in increasing plant margins, in our view. We believe profitability should continue to improve,

ex-price, as the last of the legacy-WestRock business is phased out in mid-2027, and higher

margin volume growth improves.

EMEA Containerboard

EMEA demand appears largely unchanged vs. 1Q26 reporting, with cost being the main

regional concern at present. While the market has implemented a €60/MT testliner price

increase out of the €100/MT announced by several producers in early March (and €100/MT