Sealed Air Corporation

Company Overview

Business Model: Sealed Air Corporation is a leading global provider of integrated packaging solutions, encompassing sustainable, high-performance materials, automation, equipment, and services. The Company designs, manufactures, and delivers packaging solutions primarily focused on preserving food, protecting goods, and automating packaging processes. Its solutions serve diverse end markets including fresh proteins, foods, fluids and liquids, medical and life science, e-commerce retail, logistics, omnichannel fulfillment operations, and industrials. Key brands include CRYOVAC brand food packaging, SEALED AIR brand protective packaging, LIQUIBOX brand liquids systems, AUTOBAG brand automated packaging systems, and BUBBLE WRAP brand packaging. Sealed Air Corporation's strategy centers on creating long-term, value-added partnerships with customers to advance automated packaging solutions, leveraging expertise in materials, automation systems, sustainability, science, technologies, and engineering.

Market Position: Sealed Air Corporation maintains a strong market position, underpinned by competitive strengths in high-performance packaging solutions, well-established customer relationships, iconic brands, and extensive global scale and market access. The Company serves a broad and diversified customer base, including leading food processors, e-commerce/fulfillment companies, and industrial manufacturers, with no single customer or affiliated group representing more than 10% of net sales in 2025, 2024, or 2023. Its global sales and distribution network spans 119 countries/territories, with 49% of 2025 net sales generated outside the U.S. The competitive landscape includes numerous smaller, local competitors with limited product portfolios and geographic reach, as well as larger competitors that have engaged in consolidation.

Recent Strategic Developments:

• Pending Merger: On November 16, 2025, Sealed Air Corporation entered into a definitive merger agreement to be acquired by Sword Purchaser, LLC, an entity affiliated with Clayton, Dubilier & Rice, LLC, a private investment firm. The acquisition is valued at $10.3 billion in cash, with each share of common stock to be converted into the right to receive $42.15 in cash. The transaction was unanimously approved by Sealed Air Corporation’s Board of Directors and adopted by its stockholders on February 25, 2026. It is expected to close in mid-2026, subject to regulatory clearances and customary closing conditions. Upon completion, Sealed Air Corporation will become a privately held company, and its common stock will be delisted from the New York Stock Exchange.
• CTO2Grow Program: The Company concluded its 3-year cost take-out to grow program (CTO2Grow Program) at the end of the third quarter of 2025. This initiative aimed to enhance the efficiency of its go-to-market organization, optimize its portfolio, streamline the supply chain, and improve SG&A productivity. The program successfully delivered its full annualized savings target of $160 million by year-end 2025.

Geographic Footprint: Sealed Air Corporation operates globally, with a sales and distribution network reaching 119 countries/territories. In 2025, 49% of its net sales were generated from outside the U.S. The Company maintains a presence through its subsidiaries in the U.S. and 45 other countries/territories. Manufacturing operations are conducted across 105 facilities worldwide, with 51 located in the Americas, 26 in Europe, Middle East and Africa (EMEA), and 28 in Asia, Australia and New Zealand (APAC). U.S. net sales were $2,753.0 million in 2025.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 29.8% (2025)
• Operating Margin: 13.5% (2025)
• Net Margin: 8.2% (2025)

Investment in Growth:

• R&D Expenditure: $81.9 million (1.5% of revenue)
• Capital Expenditures: $169.5 million
• Strategic Investments: In 2023, Sealed Air Corporation acquired LB Holdco, Inc. (Liquibox) for approximately $1.16 billion in cash, and engaged in other acquisition activity in the Food segment totaling $14.9 million.

Business Segment Analysis

Food

Financial Performance:

• Revenue: $3,594.7 million (+0.3% YoY as reported)
• Operating Margin: Not explicitly disclosed.
• Gross Margin: 30.6% (2025)
• Segment Adjusted EBITDA: $829.1 million (+2.6% YoY)
• Key Growth Drivers: In 2025, constant currency net sales were essentially flat, decreasing $4 million. This was primarily due to lower volumes ($25 million), particularly in North America, partially offset by favorable pricing ($22 million) across all regions, notably in North America, driven by contract-formula pricing. Segment Gross Profit and Segment Adjusted EBITDA increased due to lower operating costs and productivity benefits, partially offset by lower sales volume and unfavorable net price realization.

Product Portfolio:

• Major product lines and services: Integrated packaging materials and automated equipment solutions for increased food safety, extended shelf life, reduced food waste, and process automation.
• Brands: CRYOVAC brand Barrier Bags, CRYOVAC brand Form-Fill-Seal Films, CRYOVAC brand Auto Pouch Systems, LIQUIBOX brand liquids systems, CRYOVAC brand Grip & Tear, CRYOVAC brand Darfresh, OptiDure, and Simple Steps.

Market Dynamics:

• End markets: Industrial food processors in fresh red meat, poultry, smoked and processed meats, seafood, fluids and liquids, cheese, and other food markets. Also serves food service businesses and food retailers.
• Market trends: Capitalizes on global dynamics such as increasing labor scarcity and automation, urbanization, growth in ship-to-home food services, consumer preference for smaller portions and healthier food choices, and demand for sustainable and secure packaging.
• Competitive positioning: Faces competition from manufacturers producing food packaging based on plastic, metals, and other materials, with some competitors operating across multiple regions and others locally.

Protective

Financial Performance:

• Revenue: $1,765.1 million (-2.5% YoY as reported)
• Operating Margin: Not explicitly disclosed.
• Gross Margin: 28.6% (2025)
• Segment Adjusted EBITDA: $310.4 million (-1.0% YoY)
• Key Growth Drivers: In 2025, constant currency net sales decreased $62 million, primarily due to lower volumes ($40 million), mainly in North America resulting from prior year customer churn in the fulfillment portfolio, and unfavorable pricing ($22 million) in North America due to raw material cost deflation and pricing pressure. Segment Gross Profit and Segment Adjusted EBITDA decreased due to unfavorable net price realization and lower sales volume, partially offset by lower operating costs and productivity benefits.

Product Portfolio:

• Major product lines and services: Automated equipment, high-performance materials, and services designed to increase packaging velocity, minimize waste, reduce labor dependencies, and address dimensional weight challenges.
• Brands: SEALED AIR brand, BUBBLE WRAP brand, AUTOBAG brand, BUBBLE WRAP brand inflatable packaging, SEALED AIR brand performance shrink films, AUTOBAG brand bagging systems, Instapak polyurethane foam packaging solutions, and Korrvu suspension and retention packaging.

Market Dynamics:

• End markets: E-commerce, consumer goods, pharmaceutical and medical devices, and industrial manufacturing.
• Competitive positioning: Competes with manufacturers of protective packaging based on plastic, molded pulp, corrugated boxes, die cuts, and other materials. Some direct competitors have a less diversified global presence.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: No shares were repurchased in 2025 or 2024. In 2023, the Company repurchased $79.8 million (1,529,575 shares). As of December 31, 2025, $536.5 million remained under the authorized share repurchase program.
• Dividend Payments: $119.2 million in 2025, $118.0 million in 2024, and $117.9 million in 2023. The Board of Directors declared a quarterly cash dividend of $0.20 per common share payable on March 27, 2026.
• Future Capital Return Commitments: The Company expects to continue to comply with debt covenants that may limit dividend payments and share repurchases.

Balance Sheet Position:

• Cash and Equivalents: $344.0 million (2025) compared to $371.8 million (2024).
• Total Debt: $4,009.7 million (2025) compared to $4,403.9 million (2024).
• Net Cash Position: $(3,665.7) million (2025) compared to $(4,032.1) million (2024).
• Credit Rating:
  • Moody’s: Corporate Rating Ba1 (Under Review), Senior Unsecured Ba2, Senior Secured Baa2.
  • Standard & Poor’s: Corporate Rating BB+ (Watch Neg), Senior Unsecured BB+, Senior Secured BBB-.
  • The Baa2 and BBB- Senior Secured Ratings are classified as investment grade.
• Debt Maturity Profile:
  • 2026: $625.2 million (primarily $600 million Senior Secured Notes due October 2026).
  • 2027: $445.9 million
  • 2028: $791.3 million
  • 2029: $452.1 million
  • 2030: $339.9 million
  • Thereafter: $1,281.8 million
  • The weighted average interest rate on long-term debt was 5.2% in 2025.

Cash Flow Generation:

• Operating Cash Flow: $628.0 million (2025) compared to $728.0 million (2024). The decrease was largely due to higher tax and incentive compensation payments in 2025, partially offset by higher net earnings and non-cash adjustments.
• Free Cash Flow: $458.5 million (2025) compared to $507.8 million (2024).
• Cash Conversion Metrics: Working capital (current assets less current liabilities) decreased by $438 million in 2025 to $(181.9) million, primarily due to an increase in the current portion of long-term debt. The current ratio was 0.9x and the quick ratio was 0.6x in 2025. Gross amounts received from accounts receivable factoring agreements were $629 million in 2025. Accounts payable balances included $147 million related to suppliers participating in supply chain financing programs in 2025.

Operational Excellence

Production & Service Model: Sealed Air Corporation's operational philosophy is centered on designing, manufacturing, and delivering packaging solutions that integrate sustainable, high-performance materials, automation, equipment, and services. The Company focuses on optimizing efficiencies, extending food shelf life, and reducing product damage during transit. It actively collaborates with customers, channel partners, and suppliers to foster circular business models, advance flexible plastics recycling technologies, and minimize manufacturing and consumer waste. Internally, operations are geared towards increasing efficiency, maximizing productivity, and continuously improving the measurement and management of greenhouse gas emissions, energy, water, resource use, and manufacturing waste.

Supply Chain Architecture:

• Key Suppliers & Partners: The Company's principal raw materials are polyolefin and other petrochemical-based resins, along with paper pulp products, which typically constitute approximately one-third of its consolidated cost of sales. Other key materials include corrugated products, inks, and blowing agents. While most raw materials are readily available from multiple suppliers, Sealed Air Corporation relies on some sole-source suppliers in certain regions, mitigating associated risks through global inventory and supply agreements.
• Manufacturing Partners: The Company manufactures some specialized packaging equipment, assembles others, and purchases some from suppliers.
• Technology Partners: Collaborates with various partners to advance recycling technologies and sustainable solutions.
• Centralized Management: A dedicated supply chain organization centrally manages purchasing and logistics across both the Food and Protective segments, aiming to leverage global scale for purchasing efficiencies and reduced total delivered costs.

Facility Network:

• Manufacturing: Sealed Air Corporation operates 105 manufacturing facilities globally, with 13 serving both reportable segments. The majority of these facilities are owned.
• Research & Development: The Company maintains Packaging Solutions Development and Innovation Centers, supporting a broad range of disciplines including food science, materials science, and various engineering fields.
• Distribution: Supported by a global sales and distribution network.

Operational Metrics: The CTO2Grow Program, which concluded in Q3 2025, achieved its full annualized savings target of $160 million by year-end 2025, demonstrating a focus on operational efficiency and cost reduction.

Market Access & Customer Relationships

Go-to-Market Strategy:

• Distribution Channels:
  • Direct Sales: Food solutions are primarily sold directly to customers through the Company's global sales, marketing, and customer service personnel. Protective solutions are also sold directly to end customers, including fabricators, original equipment manufacturers, contract manufacturers, logistics partners, and e-commerce/fulfillment operations.
  • Channel Partners: Approximately 60% of Protective segment sales in 2025 were conducted through a strategic network of distributors. Sealed Air Corporation generally does not impose annual minimum purchase volume requirements on its distributors.

Customer Portfolio:

• Enterprise Customers: The Company serves a broad and diversified customer base, including leading global food processors, e-commerce/fulfillment companies, and industrial manufacturers, with a focus on building long-term relationships.
• Customer Concentration: No single customer or affiliated group of customers accounted for more than 10% of consolidated net sales or segment revenue in 2025.

Geographic Revenue Distribution:

• Americas: $3,430.8 million (64.0% of total revenue)
• EMEA: $1,172.7 million (21.9% of total revenue)
• APAC: $756.3 million (14.1% of total revenue)
• U.S. net sales: $2,753.0 million (51.4% of total revenue)
• No non-U.S. country accounted for net sales exceeding 10% of consolidated net sales in 2025.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The packaging industry is characterized by global and regional competition, with a focus on product performance, service, price, sustainability, and technological innovation. Key trends include increasing labor scarcity, automation adoption, continued urbanization, growth in ship-to-home food services, evolving consumer preferences for healthier and smaller food portions, and a rising demand for sustainable and secure packaging. The industry has also seen recent consolidation among competitors.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors: Sealed Air Corporation competes with other manufacturers offering similar products across both its Food and Protective segments. These competitors utilize a variety of materials, including plastics, metals, molded pulp, and corrugated boxes. Some direct competitors have a less diversified global presence.

Emerging Competitive Threats: The Company faces threats from changes in consumer preferences (e.g., demand for unpackaged foods, negative sentiment towards plastics), and the risk that competitors may outpace Sealed Air Corporation in adopting new technologies, including Artificial Intelligence, for product innovation, marketing, manufacturing, and cost savings.

Competitive Response Strategy: Sealed Air Corporation's strategy involves a continuous focus on developing materials that comply with regulatory requirements and meet customer needs, alongside advancements in automation and equipment offerings. The Company prioritizes innovation in sustainability and efficient new product introduction to maintain its competitive advantage.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics:

• Uncertain Global Economic Conditions: Exposure to recessionary and inflationary pressures, currency translation and devaluation effects, trade policies and tariffs, and fluctuations in raw material pricing and availability.
• Customer Response to Price Increases: Significant price increases may lead to lower sales volume and decreased gross margin, depending on competitive pricing and customer reactions.
• Changes in Consumer Preferences: Evolving consumer preferences for food and durable goods packaging, including demand for fresh/unpackaged foods and negative sentiment regarding plastics, could adversely affect product demand.
• Innovation Failure: Inability to successfully innovate and bring new products, particularly sustainable solutions, to market in a timely and efficient manner could adversely affect performance and growth.
• Political and Economic Instability: Operations are exposed to risks from civil unrest, acts of terrorism, war (e.g., Russia-Ukraine conflict, Middle East, China-Taiwan tensions), government actions (tariffs, sanctions, expropriation), and epidemics.
• Animal and Food-Related Health Issues: Outbreaks of animal diseases or other health issues affecting the food industry can lead to decreased demand for food packaging products.

Operational & Execution Risks

Supply Chain Vulnerabilities:

• Supplier Dependency: Reliance on some sole-source suppliers in certain regions, with risks mitigated through global inventory and supply agreements.
• Logistics Disruptions: Dependence on third-party logistics suppliers exposes the Company to delays, freight cost fluctuations, and limitations in transportation infrastructure.
• Capacity Constraints: Not explicitly detailed as a risk.
• Labor: Inability to attract and retain key employees, competitive labor markets, higher turnover, and potential disruptions or increased costs from collective bargaining agreements or labor shortages.
• Manufacturing & Distribution Disruptions: Risks from natural disasters, casualty losses (fire, flood), health-related illnesses impacting facilities or supply chains, and failures in information systems or telecommunication resources.
• Acquisition Integration: Risks associated with strategic acquisitions include disruption of ongoing business, diversion of management attention, difficulties integrating technologies or entering new markets, failure to realize synergies, and potential for greater than expected costs or liabilities.

Financial & Regulatory Risks

Market & Financial Risks:

• Foreign Exchange: Significant exposure to fluctuations between foreign currencies (e.g., Euro, Australian dollar, Mexican peso, Canadian dollar, British pound, Chinese renminbi, Brazilian real, New Zealand dollar, Argentine peso) and the U.S. dollar, impacting reported financial results. Argentina is designated as a highly inflationary economy.
• Credit & Liquidity: Risks include inability to generate sufficient cash flow to service indebtedness, challenges in refinancing debt, reduced credit availability for customers and suppliers, and potential adverse effects from credit rating downgrades.
• Interest Rate Risk: Variable rate indebtedness under senior secured credit facilities exposes the Company to increased debt service obligations if interest rates rise.

Regulatory & Compliance Risks:

• Industry Regulation: Subject to extensive environmental, health, and safety laws (e.g., safe storage/use of materials, waste disposal, climate change, product registration, worker safety).
• Recycling & Environmental Sustainability: Legislation targeting plastic waste (e.g., design requirements, bans, recycled content mandates, taxes, Extended Producer Responsibility laws) could reduce demand for plastic packaging or increase costs. Regulations concerning per- and polyfluoroalkyl substances (PFAS) in food packaging are also a risk.
• Global Trade Policies: Changes in global trade policies, including tariffs and other trade barriers, could negatively impact the business.
• Legal Proceedings: Involvement in various legal proceedings, including litigation, environmental matters (e.g., PFAS claims), and product liability claims, which could result in significant costs, reputational harm, or operational changes.
• Cybersecurity: Increasing cybersecurity threats pose risks to system integrity, data confidentiality, and business continuity, potentially leading to financial losses, legal liabilities, and reputational damage.
• Taxation: Subject to complex and dynamic tax laws in multiple jurisdictions, including impacts from the 2025 One Big Beautiful Bill Act (OBBBA) and the OECD Pillar Two initiative, which could affect tax expense and cash flows.

Innovation & Technology Leadership

Research & Development Focus: Sealed Air Corporation's research and development capabilities are extensive, covering food science, sustainability and materials science, chemical, mechanical, electrical, and software engineering, microbiology, digital applications development, digital printing, and packaging automation equipment design. The Company's R&D focus is on leveraging customer insights and market trends to accelerate the development of packaging solutions that meet evolving end-market needs. Core Technology Areas:

• [Technology Category]: Food science, sustainability and materials science, chemical, mechanical, electrical and software engineering, microbiology, digital applications development, digital printing, and packaging automation equipment design and engineering.
• Innovation Pipeline: Focused on developing packaging solutions that address rapidly evolving end-market needs, with a key emphasis on sustainability offerings.
• R&D Expenditure: $81.9 million in 2025, $93.4 million in 2024, and $96.9 million in 2023.

Intellectual Property Portfolio:

• Patent Strategy: Sealed Air Corporation owns or licenses approximately 2,320 U.S. and foreign patents and patent applications. The Company's business is not dependent on any single patent or trademark. It also relies on trade secrets to maintain its competitive position, particularly for product formulations and manufacturing techniques.
• Licensing Programs: Not explicitly detailed.
• IP Litigation: The Company faces risks of intellectual property infringement claims by or against third parties, which could be costly and divert management's attention.

Technology Partnerships: Sealed Air Corporation collaborates with customers, channel partners, and suppliers to support circular business models and advance technologies for recovering and recycling flexible plastics.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: The Company's former Chief Information Security Officer (CISO) departed at the end of 2025, with the Chief Information Officer (CIO) temporarily managing CISO responsibilities during an active search for a replacement. The CIO has over 30 years of enterprise IT experience.

Board Composition: The Board of Directors is responsible for oversight of risk management programs, including cybersecurity. The Audit Committee, comprising Zubaid Ahmad, Anthony J. Allott, and Kevin C. Berryman (Chairperson), has specific oversight responsibility for cybersecurity risk. All Audit Committee members are independent and financially literate, with Mr. Ahmad, Mr. Allott, and Mr. Berryman designated as audit committee financial experts. The Board consists of a majority of independent directors, and there are no family relationships among executive officers or directors.

Human Capital Strategy

Workforce Composition: As of December 31, 2025, Sealed Air Corporation had approximately 16,100 employees globally, with about 6,200 in the U.S. and 9,900 outside the U.S. The workforce includes approximately 10,900 direct manufacturing employees, alongside professionals in marketing, sales, business development, technical packaging solutions, innovation, R&D, automation, sustainability, customer service, and administrative roles. The workforce is relatively stable and does not experience significant seasonal fluctuations. Approximately 5,200 employees (32% of the total, primarily outside the U.S.) are covered by collective bargaining agreements, with agreements covering about 31% of these employees expiring in 2026. No significant union-related work stoppages occurred in 2025.

Talent Management:

• Acquisition & Retention: The Company's recruitment strategy focuses on attracting high-caliber candidates from diverse backgrounds, supported by a non-discrimination policy.
• Employee Value Proposition: Sealed Air Corporation offers career development and learning opportunities, including programs for skill development, functional/regional transfers, and career advancement.
• Diversity & Development: The Company is committed to building an inclusive workplace and culture globally, providing educational programs across various competencies.

Diversity & Development:

• Diversity Metrics: Not explicitly provided.
• Development Programs: Includes programs to equip employees with necessary skillsets and knowledge, and opportunities for career advancement.
• Culture & Engagement: Fosters a high-performance, highly engaged culture that emphasizes accountability and rewards for business outcomes.

Environmental & Social Impact

Environmental Commitments:

• Climate Strategy: Sealed Air Corporation integrates sustainable business practices into its strategy, focusing on driving increased efficiency and maximizing productivity within its operations. This includes continuous improvement in measuring and managing greenhouse gas emissions, energy, water, resource use, and manufacturing waste.
• Supply Chain Sustainability: The Company collaborates with customers, channel partners, and suppliers to support circular business models, advance technologies for recovering and recycling flexible plastics, and contribute to the diversion and reduction of manufacturing and consumer waste. It is committed to designing packaging solutions to be recyclable and incorporating recycled or renewable materials.

Social Impact Initiatives:

• Product Impact: Solutions are designed to optimize efficiencies, protect and extend the shelf life of food, and decrease product damage during transport, contributing to societal benefits.
• EHS Management System: Sealed Air Corporation operates a comprehensive Environmental, Health and Safety (EHS) management system to ensure a safe and healthy work environment across its global sites and to minimize negative environmental impacts from its operations, ensuring compliance with environmental regulations.

Business Cyclicality & Seasonality

Demand Patterns:

• Seasonal Trends: On a consolidated basis, Sealed Air Corporation experiences minimal seasonality. Historically, net sales have been slightly lower in the first quarter and slightly higher towards the end of the third quarter through the fourth quarter. This trend is observed directionally in consolidated results of operations.
  • Food Segment: Net sales tend to be slightly lower in the first quarter and higher towards the end of the third quarter through the fourth quarter, influenced by holiday events.
  • Protective Segment: Net sales also tend to be slightly lower in the first quarter and higher in the mid-third quarter and through the fourth quarter, driven by the holiday shopping season.
• Economic Sensitivity: Net sales are sensitive to developments in customer businesses, global economic conditions, and foreign currency translation. Costs can vary materially due to changes in input costs, particularly petrochemical-related raw materials.

Planning & Forecasting: Production levels and inventory management goals are based on estimates of demand, considering production capacity, shipment timing, and inventory levels. Cash flow from operations typically reflects this seasonality, being lower in the first quarter and higher in the fourth quarter due to sales patterns and working capital changes.

Regulatory Environment & Compliance

Regulatory Framework:

• Industry-Specific Regulations: Sealed Air Corporation is subject to various federal, state, local, and foreign environmental, health, and safety laws and regulations. These cover aspects such as the safe storage and use of raw materials, release of materials into the environment, and the treatment, storage, and disposal of solid and hazardous wastes. The Company also complies with product-specific regulations, including those administered by the U.S. Food and Drug Administration (FDA) for controlling microbial growth in food, and worker safety requirements from agencies like the U.S. Occupational Safety and Health Administration (OSHA).
• International Compliance: The Company monitors and complies with laws and regulations related to plastics use, minimum recycled content, and the sale or disposal of packaging materials, including Extended Producer Responsibility (EPR) laws in various U.S. states, the UK, EU, and Canada. The EU's Packaging and Packaging Waste Regulation (PPWR) is also being monitored for potential impacts. Sealed Air Corporation is in compliance with current U.S. regulations regarding per- and polyfluoroalkyl substances (PFAS) in food packaging and is reformulating products in other regions to comply with anticipated regulations.

Legal Proceedings:

• Material Litigation: In 2025, a breach of contract and unfair trade practices lawsuit with Water.IO Ltd was settled, with no material financial impact on the Company.
• Environmental Matters: The Company is subject to loss contingencies from environmental laws and regulations, including claims related to the alleged use of PFAS in its products and manufacturing processes. Accruals are made for probable and estimable costs, and the Company does not believe that liabilities in excess of accrued amounts will be material.
• Guarantees and Indemnification Obligations: Sealed Air Corporation is party to contracts with guarantees and indemnification obligations, including those related to the 2017 sale of Diversey, product warranties, and third-party intellectual property infringement claims. The potential maximum exposure for some of these obligations is not reasonably estimable.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: Sealed Air Corporation's effective tax rate was 7.4% in 2025, 41.2% in 2024, and 21.0% in 2023.
• Rate Drivers: The 2025 rate was decreased by the reversal of accruals for uncertain tax positions related to U.S. and international tax matters and the utilization of tax credits. This was partially offset by foreign earnings subject to higher tax rates, the establishment of a valuation allowance in Luxembourg, state income tax expense, and the impact of U.S. tax reform.
• Geographic Tax Planning: The Company has indefinitely reinvested most of its foreign earnings.
• Tax Reform Impact: The 2025 One Big Beautiful Bill Act (OBBBA) introduced tax reform provisions, including an elective deduction for domestic R&D and reinstatement of 100% first-year bonus depreciation, which did not materially impact the Company's overall tax expense in 2025. Sealed Air Corporation has also recorded Pillar Two tax amounts of $1.6 million in 2025 and $0.7 million in 2024, in response to the global minimum tax initiative.
• Deferred Tax Assets: Net deferred tax assets were $28.4 million in 2025, down from $66.9 million in 2024. Valuation allowances of $219.8 million were established in 2025, primarily for foreign items and tax credits.
• Tax Audits: In Q3 2025, the Company resolved IRS audits for the years 2017 through 2019. A definitive agreement was reached with the IRS in Q4 2023 to settle a 2014 asbestos-related deduction matter.

Insurance & Risk Transfer

Risk Management Framework: Sealed Air Corporation manages its exposure to market risks, including changes in global financial markets, interest rates, foreign currency exchange rates, commodity prices, and the creditworthiness of customers and suppliers, through regular operating and financing activities and, when appropriate, derivative financial instruments. The Company does not use derivatives for trading purposes. Counterparty credit risk is managed through minimum credit standards, credit limits, and diversification.

• Insurance Coverage: The Company maintains insurance policies for property, cargo, auto, product, general liability, environmental, and directors' and officers' liability. Management believes these coverages are reasonable and prudent, though potential claims could exceed limits or be excluded.
• Risk Transfer Mechanisms: Financial instruments are used to hedge certain foreign currency exposures and manage interest rate volatility. Cross-currency swaps are designated as net investment hedges.