SW 10-K & 10-Q changes, risk factors and insider trading

Investing in our ordinary shares involves uncertainty and risk due to a variety of factors. You should carefully consider the risks described below, which could materiallyhave adverselya affectmaterial adverse effect on our business, financial condition, reputation, results of operations (including revenues and profitability) and/or ordinary share price, with all of the other information included in this Annual Report on Form 10-K. OurThe businessCompany ismay alsonot subjectbe able to generalaccurately riskspredict, control or mitigate these risks. Statements in this section are based on the Company’s beliefs and uncertaintiesopinions regarding matters that maycould broadlymaterially adversely affect companies, including us. Some of the factors, events, and contingencies discussed below may have occurredCompany in the past,future and the disclosures below are not representations as to whether such matters have or have not the factors, events, or contingencies have occurred inpreviously. the past, but are provided because future occurrences of such factors, events, or contingencies could have a material adverse effect on our business, results of operations, financial condition, cash flows or share price. Further, theThe risks and uncertainties described below are not theexhaustive onlyand onesshould wenot face.be Additionalconsidered a complete statement of all potential risks notor presentlyuncertainties knownthat tothe usCompany faces or that we currently deem immaterial may alsoface materiallyin affectthe our business, financial condition, results of operations (including revenues and profitability) and/or ordinary share price.future.

•Failure by us to successfully implement strategic transformation initiatives, including those relating to information technology infrastructure, or to achieve our mid-range or long-range targets and goals could adversely affect our business.business and share price.

Risks•We Relatedface risks related to the CombinationCombination.

•Our continued growth depends on our ability to retain existing customers and attract new customers.

•Our debt could adversely affect our financial health.health and operating flexibility.

•We have a number of pension arrangements that are currently in deficit and may incur additional liability and/orrequire increased funding requirementsdue into connectionstatutory with multi-employer pension plans.requirements.

•AnyOur dividenddecision paymentor ability to pay dividends in respect of our shares or conduct share repurchases is subject to a number of factors, and there are no guarantees that the Company will pay dividends or maintain or increase the level of any such dividends.dividends or that the Company will conduct share repurchases.

•We are subject to a growing number of environmental and climate change laws and regulations.regulations that impose compliance obligations and costs, and failure to comply with these laws may have a material adverse effect on our business.

•We are subject to compliance with antitrustcompetition and similarantitrust legislationlaws and regulations in the jurisdictions in which we operate.operate and, from time to time, may be subject to investigations or proceedings with respect to allegations of unfair competitive practices and similar behavior.

•macroeconomic and business conditions, including deteriorating or volatile macroeconomic conditions and related supply and demand dynamics, as well as inflation and deflation;

•conditions in the financial services markets, including counterparty risk, insurance carrier risk, rising interest rates, rising commodity prices, and currency exchange rate fluctuations, which may impact price and demand for our products and the costs to finance and operate our business;

•financial and economic uncertainties in our major international markets;

•government deficit reduction and other austerity measures in specific countries or regions, orincluding protectionist measures that limit international trade, could have a negative impact on manufacturing and production levels of businesses and customers in the various industriesmarkets in which we operate; and

The outlook for the global economy in the near- to medium-term remains uncertain and we are unable to predict the timing or rate at which economic conditions in our markets may change and the impact of such changes. For example, if the economic climate were to deteriorateexperience a deterioration as a result of geopolitical events (such as thean Russian warescalation in Ukraineexisting wars or conflicts or the conflictinitiation inof theadditional Middle East)conflicts or geopolitical uncertainty,hostilities), trade tensions (including the implementation of tariffs on U.S. imports by the current U.S. Administration and potential retaliatory tariffs) and/or a pandemic, it could result in an economic slowdown which, if sustained over any significant length of time, could have a material adverse effect on our business, results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares. In addition, changes in trade policies, including renegotiating, or potentially terminating, existing bilateral or multilateral agreements, as well as the imposition of tariffs, could impact demand for our products and the costs associated with operating our business, including certain of our capital investments.

The global economy also continues to experience elevated levels of inflation, and we experienced cost inflation across our business in fiscal 2023 and 2024, albeit at moderating levels since fiscal 2022. Persistent inflation results in higher manufacturing and transportation costs, which we may not be able to recover through higher prices charged to our customers.

Consequently, the industry has from time-to-time experienced periods of substantial overcapacity and there can be no assurance that this will not reoccur. For example, we experienced market-related downtime at certain of our mills during the fourth quarter of fiscal 2025.

Certain of the Company’s paper mills are subject to regulation under regulatory programs that mandate reductions in greenhouse gas emissions, including the EU Emissions Trading Scheme, Quebec’s Regulation respecting a cap-and-trade system for greenhouse gas emission allowances, and, in the United States, the Washington Climate Commitment Act, whereby covered businesses are issued emissions allowances based on an annual limit or “cap” on greenhouse gas emissions and are required to have a sufficient number of allowances to cover their annual greenhouse gas emissions. If a business’ greenhouse gas emissions exceed its available allowances, it may be required to make capital investments or other expenditures to reduce emissions, or it may be required to buy additional allowances on the market, at government auctions, or from other program participants. Failure to have a sufficient number of allowances available may subject a business to penalties. As part of an energy-intensive, trade-exposed sector, the Company’s paper mills that are subject to existing cap-and-trade regulations are entitled to receive a certain number of greenhouse gas emission allowances at no cost to ease the energy transition. To date, the number of no-cost allowances granted to our mills has been sufficient to cover our compliance obligations; however, thereThere is a risk that in the future we will not have enough free allowances to meet our compliance requirements. If we are required to make investments to reduce our greenhouse gas emissions, such as switching fuels to lower carbon alternatives, or purchase allowances, these costs may not be recoverable through higher prices for our products and could negatively affect our operations, financial condition and cash flows. Failure to meet our greenhouse gas obligations could result in fines, penalties and potential damage to our business reputation. We also face risks that more of the Company facilities could become subject to cap-and-trade programs or similar greenhouse gas reduction mandates in the future and that these programs or mandates could significantly increase our energy and other input costs in these jurisdictions. Our production processes are energy intensive. If energy prices increase in the future, this would increase our production costs, which could consequently have a material adverse effect on our profitability.

We operate in a highly competitive and fragmented industry. The paper and packaging industry is characterized by a high level of price competition, as well as other competitive factors including innovation, design, quality and service. To the extent that any of our competitors are more successful with respect to any key competitive factor, our business, results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares could be materially adversely affected. Pricing pressure could arise from, among other things, limited demand growth in the market in question, price reductions by competitors, growth in supply from existing competitors, entry of new competitors into the markets in which we operate, the ability of competitors to capitalize on their economies of scale and create excess product supply, the ability of competitors to operate or successfully relocate or open production facilities in countries where production costs are lower than those in which we operate and the introduction by our competitors of new products, technologies and equipment, including the use of artificial intelligence and machine learning solutions.

Our products also compete, to some extent, with various other packaging materials, including products made of plastics, wood and various types of metal. Customer shifts away from paper packaging to packaging made from other materials could adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

•catastrophic events, such as fires, floods, earthquakes, explosions, natural disasters, severe weather, including hurricanes, tornadoes and droughts, and pandemics, such as COVID-19, or other health crises or similar occurrences;

Smurfit Westrock has 6257 paper mills.mills of differing capacities. If operations at any of these key mills (those which are more complex and/or have higher capacity) were interrupted for any significant length of time, it could have a material adverse effect on our business, results of operations, financial condition and the trading price of our ordinary shares.

Our success depends, in part, on our ability to offer differentiated solutions, and we must continually develop and introduce new products and services to keep pace with technological and regulatory developments and changing customer preferences. The services and products that we offer customers may not meet their needs as their business models evolve. Also, our customers may decide to decrease their use of our products, use alternative materials for their product packaging or forego the packaging of certain products entirely. Regulatory developments can also significantly alter the market for our products. For example, a move to electronic distribution of disclaimers and other paperless regimes could adversely impact our healthcare inserts and labels businesses. Similarly, certain states and local governments have adopted laws banning single-use paper bags or charging businesses or customers fees to use paper bags. Certain jurisdictions in which we conduct business have enacted extended producer responsibility legislation that requires producers to assume financial accountability for the complete lifecycle of products, including associated fees on packaging. These and similar developments could adversely impact demand for certain of our products.

We have been involved in trialing new and evolving technology, but doing so may require significant investments of capital, and such innovations are subject to long lead times and failure. Trialing such technology can take an extended period of time, with little to no returns in the short or medium terms. Any such risks could have a material adverse effect on our business, results of operations, Our success also depends, in part, upon our ability to obtain and maintain protection for certain proprietary packaging products and packaging machine technologies used to produce our products. Failure to protect our existing intellectual property may result in the loss of valuable legal rights. Our competitors may obtain intellectual property rights that could require us to license those rights or to modify or cease the use or sale of certain of our technologies or products. Our patents could be invalidated, rendered unenforceable, circumvented, challenged or licensed to others, and our pending or future patent applications may not be issued with the scope of the claims we seek, if at all. Further, other companies may develop technologies that are similar or superior to our technologies, duplicate our technologies or design around our patents, and steps we take to protect our technologies may not prevent misappropriation of those technologies.

We operate in a capital-intensive industry and undertake expansion projects to either support growth in our business or improve the breadth and quality of our product offerings, including investments in both mill and converting operations. Many of our capital projects are complex, costly and/or implemented over an extended period of time. Our expenditures for capital projects could be higher than anticipated, we may experience unanticipated business disruptions or delays in completing the projects and/or we may not achieve the desired benefits from those projects, including as a result of a deterioration in macroeconomic conditions or in our business, unavailability of capital equipment or related materials, delays in obtaining permits or other requisite approvals or changes in laws and regulations. In addition, disputes between us and contractors who are involved with implementing capital projects could lead to time-consuming and costly litigation. Any of these circumstances could adversely affect our results of operations, cash flows and financial condition, and the trading price of our ordinary shares.

•political, economic and social unrest or instability (such as downturns or changes in economic activity due to, among other things, regional conflicts or commodity inflation), the ongoing hyperinflation in Argentina (which has led us to apply hyperinflationary accounting to our Argentinian operations in recent years), as well as disruptions and government intervention in national economies and social structures, including the threat of terrorism;

The occurrence of any of the foregoing could have a material adverse effect on our earnings as a result of the related delays or increased costs in the production and delivery of products and services or otherwise disrupt the demand for our products. Any of these circumstances could adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

We may fail to produce products that meet applicable safety and quality standards, which could result in adverse effects on consumer health, litigation exposure, loss of market share and adverse reputational and financial impacts, among other potential consequences, and we may incur substantial costs in taking appropriate corrective action (up to and including recalling products from end consumers and reimbursing customers and/or end consumers for losses that they suffer as a result of these failures). Our failure to meet these standards could lead to regulatory investigations, enforcement actions and/or prosecutions, and could result in adverse publicity, which may damage our reputation. Any of these outcomes could have a material adverse effect on our business, results of operations, cash flows and financial conditioncondition, and the trading of our ordinary shares.

We provide representations in certain of our contracts that our products are produced in accordance with customer specifications. If the product contained in packaging manufactured by us is faulty or contaminated, the manufacturer of the product may allege that the packaging we provided caused the fault or contamination, even if the packaging complies with contractual specifications. If our packaging fails to meet contract specifications, we could face liability from our customers and third parties for bodily injury or other damages. These liabilities could adversely affect our business, results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

Despite our security measures, our information technology, and that of our third-party providers and business partners, is subject to recurring attempts by threat actors to access information, manipulate data or disrupt operations. Information technology that we, third-party providers and business partners use may be vulnerable to cyber-attacks or outages by common hackers, criminal groups, nation-state organizations or social activist organizations (whose efforts may increase as a result of geopolitical events and political and social unrest or instability around the world) due to insider threat, malfeasance or other disruptions, such as cyber-attacks, power outages, telecommunication or utility failures, systems failures, service provider failures, natural disasters or other catastrophic events. The significant increase in remote working and the continued expansion of the integrated supply chain increase the risks of cyber incidents and the improper dissemination of personal or confidential information. Any such breach could compromise our information technology and the information stored there could be accessed, publicly disclosed, lost or stolen, potentially resulting in legal claims or proceedings and regulatory penalties. In addition, any such outage could disrupt or temporarily halt our operations resulting in reduced productivity, staff downtime, and increased insurance premiums, as well as additional costs for attempting to recover lost information, equipment or data, and could damage our reputation, which could have a material adverse effect on our business, results of operations, We may also face challenges and risks during integration of acquired businesses and operations, as we and the acquired businesses and operations may face increased targeted attempts during this busy period. While we maintain plans and processes to prevent or mitigate the impact of these events, these events could nonetheless result in disruptions and damage. In addition, as a result of the foregoing, we could experience adverse publicity, loss of sales, the cost of remedial measures, including substantial legal fees, and significant expenditures to reimburse third parties for damages, each of which could adversely impact our results of operations. Any insurance we maintain against the risk of this type of loss may not be sufficient to cover actual losses, may not apply to the circumstances relating to any particular loss, or may become materially more costly over time. As a result, any or all of the above events could adversely affect our operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

In addition, our business relies on vendors, suppliers and other third parties that have union employees. Any of the matters described above, including work stoppages or other labor relations matters affecting us or these vendors, suppliers and other third parties, as well as future developments in relation to our business or otherwise that adversely affect relations between us and our employees, could adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

The market for both hourly workers and professional workers remainedcontinued to be challenging in fiscal 2024,2025, particularly in the U.S. The market and labor environment for hourly workers is increasinglyremains competitive andwith facingcontinued higher levelsinstances of labor unrestunrest, thaneven hasas historicallybroader beenmanufacturing experienced.employment trends moderated from prior peaks. In certain locations where we operate, the demand for labor continues to exceed the supply of labor, resulting in higher costs. Despite our focused efforts to attract, motivate and retain employees, we continue to focus on the stabilization of attrition rates within our workforce. We also incurred higher operating costs at certain of our facilities in the form of higher levels of overtime pay due to shift requirements and staffing challenges.

We also rely on key executive and management personnel to manage our business efficiently and effectively. The loss of these employees, combined with a challenging market for attracting and retaining employees, could adversely affect our results of operations, cash flows and financial condition, and the trading price of our ordinary shares may also be adversely impacted. The recent Combination may exacerbate each of these challenges.

We have identified multiple ways in which climate change could impact our business operations, including through extreme weather events. Our physical assets and infrastructure, including our manufacturing operations, are subject to risks from volatile and damaging weather events. For example, severe weather, such as hurricanes, tornadoes, other extreme storms, wildfires, and floods, have resulted in and/or could in future periods result in lost production and/or physical damage to our facilities. Unpredictable weather patterns or extended periods of severe weather may also result in supply chain disruptions and increased material costs. In addition, one of our key raw materials is virgin wood fiber, the availability of which is dependent on access to and the maintenance of healthy forests, which could be impacted by adverse weather conditions, including drought, flooding and local restrictions on water usage. Moreover, the ability to harvest the virgin wood fiber used in our manufacturing operations may be limited, and prices for this raw material may fluctuate, during prolonged periods of heavy rain or drought or during tree disease or insect epidemics or other environmental conditions that may be caused by variations in climate conditions. Other climate-related business risks that we face include risks related to the transition to a lower-carbon economy, such as increased prices for certain fuels, including natural gas; the introduction of a carbon tax or government mandates to reduce greenhouse gas emissions; and more stringent and/or complex environmental and other legal requirements. To the extent that severe weather or other climate-related risks materialize, and we are unprepared for them, we may incur unexpected costs, which could adversely affect our results of operations, cash flows and financial condition, and the trading price of our ordinary shares.

The paper manufacturing industry in which we operate is energy intensive, and government initiatives, such as the European Union Green Deal, the European Union’s initiative to reach net zero emissions of greenhouse gases by 2050, could increase government regulation of greenhouse gas emissions, putting further limits on our paper manufacturing operations. In addition, if efforts aimed at transitioning to a lower carbon economy may result in a transition towards the use of materials that are more suitable for reusable packaging. As such,packaging, demand for paper packaging may decline, while demand for alternative packaging types may increase, which could adversely affect our results of operations, cash flows and financial condition, and the trading price of our ordinary shares.

Increased focus and activism related to sustainability matters may hinder our access to capital, as investors may reconsider their capital investment as a result of their assessment of our sustainability practices. Customers, investors, regulators and other stakeholders are focused on sustainability issues, including those with respect to climate change, circular economy, packaging waste, sustainable supply chain practices, deforestation, biodiversity, land, energy and water use, diversity, equity, inclusion and belonging and other human capital matters. This focus may result in more prescriptive reporting requirements with respect to these topics, an increased expectation that such topics will be voluntarily disclosed by companies such as ours, and increased pressure to make commitments, set or revise targets and take action to meet them. Concern over climate change or the use and composition of packaging materials may also result in new or increased legal and regulatory requirements to reduce or mitigate impacts to the environment. These demands, regulatory requirements, and related perceptions and preferences could cause us to incur additional costs or to make changes to our operations to comply with such, demands, requirements and customer preferences, and a delay in our response (or the failure to respond effectively) may lead to material adverse effects on our business, results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares. See also “We are subject to a growing number of environmental laws and regulations, and the cost of compliance or the failure to comply with, and any liabilities under, current and future laws and regulations may negatively affect our business.” Further, there can be no assurance that environmental activist groups and similar organizations will not mount campaigns against us. On the other hand, our sustainability efforts may not be favored by certain stakeholders, whose priorities and expectations may not align or may be opposed to one another and/or those of the Company, and there can be no assurance that our sustainability efforts will be perceived positively, including the perception that they are not sufficiently robust, or conversely, too costly, or not otherwise in the best interests of the Company and our shareholders, and, as a result, our investor, customer and other stakeholder relationships could be damaged or this could lead to public scrutiny or reputational damage, which could adversely impact our reputation, business and results of operations.

Both legacy Smurfit Kappa and WestRock previously established and publicly disclosed sustainability targets which are important to many stakeholders, including certain investors and customers. Similarly,New targets for Smurfit Westrock mayare developexpected andto publishbe newpublished consolidatedin groupthe targets.second quarter of 2026 in the 2025 sustainability report. We expect to report performance relative to any such targets on an annual basis. Failure to meet any such targets could result in negative publicity and reputational damage and could have a material adverse effect on our business, reputation, results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares. If any such targets or commitments are not achieved on their projected timelines or at all, or if they are perceived negatively, including the perception that they are not sufficiently robust or, conversely, are too costly, this would impact our reputation as well as our relationships with investors, customers and other stakeholders. Moreover, any failure to act responsibly with respect to sustainability issues or to effectively respond to new, or changes in, legal or regulatory requirements concerning environmental or other sustainability matters, or increased operating or manufacturing costs due to increased regulation could have a material adverse effect on our business, reputation, operating results, financial condition and the trading price of our ordinary shares. In addition, we may also be adversely impacted as a result of conduct by contractors, customers or suppliers that fail to meet our or our stakeholders’ sustainability standards.

Any of these risks could adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

Failure by us to successfully implement strategic transformation initiatives, including those relating to information technology infrastructure, or to achieve our mid-range or long-range targets and goals could adversely affect our business.business and share price.

As part of integration initiatives, the Company is reviewing and evaluating its various business systems and the system strategies and alternatives for Smurfit Westrock. The implementation of changes in business systems could represent a significant financial undertaking and may require substantial time and attention of management and key employees. We may not be able to successfully implement these initiatives without delays or may experience unanticipated business disruptions and/or we may not achieve the desired benefits from such changes. Project completion dates may also change. Any of these items, along with any failure to effectively manage data governance risks during implementation of these initiatives, could adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares.

We have completed a number of mergers, acquisitions, investments and divestitures in the past, including the recent Combination, and we may seek to acquire, invest in, sell or enter into transactions with additional companies in the future. See also the“We face risks discussed under “Risks Relatedrelated to the Combination” described below..

These transactions may not be successful and may adversely affect our results of operations, cash flows and financial conditioncondition, and the trading price of our ordinary shares. Among the benefits we expect from potential, as well as completed, acquisitions and joint ventures are synergies, cost savings, growth opportunities or access to new markets (or a combination thereof), and in the case of divestitures, the realization of proceeds from the sale of businesses and assets to purchasers that place higher strategic value on these businesses and assets than we do. For acquisitions, our success in realizing these benefits and the timing of realizing them depend on the successful integration of the acquired businesses and operations with our business and operations. Even if we integrate these businesses and operations successfully, we may not realize the full benefits we expected within the anticipated time frame, or at all, and the benefits may be offset by unanticipated costs or delays.

RisksWe Relatedface risks related to the CombinationCombination.

The following discussion and analysis of Smurfit Westrock’s financial condition and results of operations should be read in conjunction with Smurfit Westrock’s audited Consolidated Financial Statements and their related notes for the year ended December

December 31, 2024,2025 and our audited Consolidated Financial Statements and their related notes for the year ended December 31, 2023 and Smurfit

Statement”).2024. This discussion contains forward-looking statements that involve risks and uncertainties. Smurfit Westrock’s future results could differ materially from the results discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the Item 1A. Risk Factors. Please refer to the section above entitled

TheSmurfit MergerWestrock iswas recognizedcreated in July 2024 as a businessstrategic combination underbetween AccountingSmurfit StandardsKappa CodificationGroup plc (re-registered as Smurfit Kappa Group Limited) (“ASCSmurfit Kappa”) 805,and “BusinessWestRock Combinations”Company (“ASC 805WestRock”). The Combination closed on July 5, 2024. Upon completion of the Combination, Smurfit Kappa and WestRock each became wholly-owned subsidiaries of Smurfit Westrock. As noted above, Smurfit Kappa was determined to be the accounting acquirer of WestRock. Accordingly, as noted above, the financial statements reflected in these Consolidated Financial Statements and the discussions below include WestRock's financial position and results of operations for the period subsequent to the completion of the Combination on July 5, 2024. Consequently, the results reported for the twelve months ended December 31, 2024 do not include WestRock’s financial results for the first five days of July or any prior periods. Therefore, in fiscal 2025 acquired WestRock operations were included for an incremental six months and five days compared to fiscal 2024.

Refer to “Note 2. Acquisitions” of the Consolidated Financial Statements for additional information related to the Combination and the accounting for the Combination.

Following the completion of the Combination, Smurfit Westrock reassessed the Company’s reportable segments due to changes in organizational structure and how the Company’s chief operating decision maker (“CODM”) makes key operating decisions, allocates resources and assesses the performance of the business. Consequently, subsequent to the Combination,Accordingly, Smurfit Westrock began to manage the combined business as three reportable segments: (1) North America, (2) Europe, the Middle EastMEA and Africa (“MEA”), and Asia-Pacific (“APAC”),APAC, and (3) Latin America (“LATAM”). As a result of the change in reportable segments, certain prior year amounts have been recast to conform to the current year presentation. Throughout this Annual Report on Form 10-K, unless otherwise indicated, amounts and activity reflect reclassifications related to the Company's change in reportable segments.LATAM. Refer to “Note 3. Segment Information” of the Consolidated Financial Statements for further discussion of the Company’s segment reporting structure.

Net income attributable to common shareholders decreasedincreased by $506$380 million, to $699 million in the year ended December 31, 2025, from $319 million in the year ended December 31, 2024,2024. fromThe $825increase millionwas primarily due to the operations acquired in the Combination. In the year ended December 31, 2023.2025, Thisthe decreasepositive impact of the acquired operations was primarilypartially drivenoffset by anincreased increaseinterest ofexpense, $317net, millionpost inCombination, and we incurred increased impairment and restructuring costs. In the year ended December 31, 2024, we incurred higher transaction and integration-related expenses associated with the Combination, an increase of $259 million in interest expense, net,Combination and a charge of $224 million for the amortization of the fair value step up on inventory recognized on WestRock’s inventory acquired. The increases in expenses were partially offset by the positive impact of the Combination. Refer toSee “ResultsNote of Operations” for a detailed review of Smurfit Westrock’s performance.5.

It also directionally correlates with levels of industrial production and is impacted by the trends affecting the choice of medium (paper, plastic, glass, metal, or wood) used in the packaging of these products. As a result, demand is driven by the need for: (i) packaging products for consumer and industrial goods, (ii) higher value-added corrugated products used for point-of-sale displays and consumer and shelf-ready packaging, and (iii) packaging of pharmaceutical products and the growth of related industries. Normal patterns of demand growth can be disrupted by other macroeconomic trends, including inflation, pandemics (includingsuch as the COVID-19 pandemic and related lockdowns), and global economic factors such as a recession and geopolitical developments,developments (including tariffs or other trade restrictions), among others.

As paper costs generally represent a large portion of the cash cost of production for corrugated containers or consumer packaging, containerboard price movements tend to impact the prices of corrugated containers.containers, and paperboard price movements tend to impact the prices of consumer packaging. In turn, the cost of paper is influenced by movements in the price of its major raw materials—wood or recycled paper—along with other supply and demand factors. Smurfit Westrock’s production processes are energy-intensive, making production costs also sensitive to the price of energy (primarily gas and electricity), which have historically been volatile. Other key cost drivers include employee benefit expenses, largely determined by workforce size, and shipping and handling costs, which are generally affected by fuel prices and overall labor inflation.

Smurfit Westrock operates in multiple countries across North America, South America, Europe, MEA,Asia, APAC,Africa, and LATAM.Australia. As a result, currency fluctuations can have both direct and indirect impacts on its financial statements, which are presented in U.S. dollars.

The following table summarizes Smurfit Westrock’s consolidated results for the three years ended December 31, 2024, December 31, 20232025 and December 31, 20222024 ($ in millions):

Excluding the impact of this acquisition, net sales decreasedincreased by $365$225 million primarily resulting from a $715$487 million positive impact due to a lowerhigher selling/ price mix,mix and a $452 million net positive foreign currency impact, partially offset by a positivenegative volume impact of $377$716 million. See “Segment Information” below for more detail on Smurfit Westrock’s segment results.

Cost of goods sold increased by $7,875$8,222 million, to $25,136 million in the year ended December 31, 2025, from $16,914 million in the year ended December 31, 2024, from $9,039 million in the year ended December 31, 2023.2024. The increase in cost of goods sold was primarily due to the impact of the acquisition of WestRock of $7,997$8,240 million,million. whichExcluding includedthe an expenseimpact of this acquisition for the incremental period consolidated in the current year, cost of goods sold decreased by $18 million. The decrease was primarily driven by the impact of lower volumes and the prior year $224 million for the amortization of the fair value step up on inventory recognized on WestRock’s inventory acquired. ExcludingThese theitems impactwere of this acquisition, cost of goods sold decreased by $122 million primarily due to lower input prices partlylargely offset by higher volumes.costs in the current year, including increased economic downtime, higher depreciation, depletion and amortization expense, higher energy costs, as well as a net negative foreign currency impact.

SG&A expenses increased by $1,189$1,082 million, to $2,793$3,819 million in the year ended December 31, 2024,2025, from $1,604$2,737 million in the year ended December 31, 2023.2024. The increase in SG&A expenses of $1,189$1,082 million was primarily due to additional SG&A expenses of $1,189$1,126 million related to the acquisition of WestRock. Excluding the impact of this acquisition, SG&A decreased by $44 million primarily due to lower share-based payment expense, partially offset by higher depreciation, depletion and amortization expense.

Integration-relatedTransaction-related expensescosts associated with the Combination were $193comprised millionof inbanking and financing related costs as well as legal and other professional services which were directly attributable to the yearCombination endedand Decemberretention 31,payments 2024.that were contractually committed to and associated with the successful completion of the Combination. We incur integration costsexpenses post-acquisition that reflect work performed to facilitate merger and acquisition integration and primarily consist of professional services and personnel and related expenses, such as work associated with information systems.

Pension and Other Postretirement Non-Service Expense,Income (Expense), Net

Pension and other postretirement non-service expense,income (expense), net decreasedincreased by $25$54 million, to $24income of $30 million in the year ended December 31, 2024,2025, from $49$24 million of expense in the year ended December 31, 2023.2024. This decreaseincrease was primarily due to a $170$164 million increase in the expected return on plan assets primarily due to acquired netdefined benefit pension assets in connection with the Combination,Combination thatand wasa decrease in net settlement loss of $17 million, partially offset by an increase in interest costs of $128$132 million primarily due to acquired netdefined benefit pension assetsliabilities in connection with the Combination; a $12 million increase in one-time settlement expenses and a $7 million increase in the net actuarial loss.Combination.

Other (Expense) Income,Expense, Net

Other (expense) income,expense, net decreasedincreased by $21$36 million, to a net expense of $61 million in the year ended December 31, 2025, from a net expense of $25 million in the year ended December 31, 2024, from a net expense of $46 million in the year ended December 31, 2023.2024. This decreaseincrease was primarily due to a $30 million net positive impact from foreign currency translation of monetary assets and liabilities and a $10$15 million increase in income from equity method investments. This was partially offset by a $23 millionthe expense recorded in the year ended December 31, 2024 in connection with the sale of receivables under an accounts receivable monetization program acquired as a result of the Combination.Combination and a $10 million net negative impact from foreign currency translation of monetary assets and liabilities.

Smurfit Westrock’s net sales increased by $56$91 million, to $7,712$8,031 million in the three months ended MarchJune 31,30, 2026, from $7,656$7,940 million in the three months ended MarchJune 31,30, 2025. ThisThe increase was primarily due to a net positive foreign currency impact that was partially offset by a lower selling price mix. Smurfit Westrock’s net sales increased by $147 million, to $15,743 million in the six months ended June 30, 2026, from $15,596 million in the six months ended June 30, 2025. The increase was primarily due to a net positive foreign currency impact that was largely offset by a negative volume impact.impact and a lower selling price mix.

Net cash provided by operating activities decreased by $31$95 million, to $204$969 million in the threesix months ended MarchJune 31,30, 2026, from $235$1,064 million in the threesix months ended MarchJune 31,30, 2025, primarily due to a $188$106 million decrease in net income adjusted for non-cash items, primarily including depreciation, depletion and amortization, impairment of assets, cash surrender value increase in excess of premiums paid, share-based compensation expense, deferred income tax benefit, and pension and other postretirement funding more than cost. Changes in operating assets and liabilities were a benefit of $157$11 million compared to the prior year period. During the threesix months ended MarchJune 31,30, 2026, Smurfit Westrock invested $624$1,089 million in capital expenditures. The Company’s net cash inflow from changes in debt was $517$439 million, and it paid $237$474 million of cash dividends to shareholders. See the section entitled “Liquidity and Capital Resources” below for additional information.

Results of operations for the three and six months ended MarchJune 31,30, 2026, compared to the three and six months ended MarchJune 31,30, 2025

Net sales increased by $56$91 million, to $7,712$8,031 million in the three months ended MarchJune 31,30, 2026, from $7,656$7,940 million in the three months ended MarchJune 31,30, 2025. This increase was primarily due to a $316$146 million net positive foreign currency impact that was largelypartially offset by a $256lower millionselling impactprice mix of lower$60 volumes.million.

Cost of goods sold increased by $365$207 million, to $6,444$6,632 million in the three months ended MarchJune 31,30, 2026, from $6,079$6,425 million in the three months ended MarchJune 31,30, 2025. TheThis increase in cost of goods sold was primarily due to a $277$102 million net negative foreign currency impact, $74 million of economic downtime, $70 million of accelerated depreciation costs for machine closures, a $65 million impact of adverse weather and $48$90 million of higher freight costs and $47 million higher depreciation, depletion and amortization expense and $22 million higher energy costs, partially offset by the impact of lowera volumes$71 million decrease in raw material costs, $26 million of $208lower million.downtime.

SG&A expenses decreasedincreased by $12$7 million, to $961$970 million in the three months ended MarchJune 31,30, 2026, from $973$963 million in the three months ended March 31, 2025. The decrease in SG&A expenses wasdecreased primarilyby due$5 million, to lower$1,931 employeemillion compensation.in the six months ended June 30, 2026, from $1,936 million in the six

Impairment and restructuring costs increaseddecreased by $39$161 million, to $54$119 million in the three months ended MarchJune 31,30, 2026, from $15$280 million in the three months ended MarchJune 31,30, 2025. In the three months ended MarchJune 31,30, 2026, impairment and restructuring costs consisted of $35$72 million of impairment charges and $19$47 million of restructuring costs. In the three months ended MarchJune 31,30, 2025, impairment and restructuring costs consisted of $15$184 million of impairment charges and $96 million of restructuring costs. The higher impairment and restructuring costs in the three months ended June 30, 2025 were primarily associated with previouslythe announcedApril facility2025 andAnnounced machine closures, including asset impairments, severance and other costs.Closures.

The Company incurred transaction and integration-related expenses associated with the Combination of $—$1 million and $36$21 million in the three months ended MarchJune 31,30, 2026 and 2025, respectively. In the three months ended MarchJune 31,30, 2025, transaction and integration-related expenses consisted of transaction-related expensesprimarily of $2 million and $34$23 million of integration-related expenses associated with the Combination.

Pension and other postretirement non-service income, net decreasedincreased by $1$3 million,million towith income of $8$10 million in the three months ended MarchJune 31,30, 2026,2026 fromand income of $9$7 million in the three months ended MarchJune 31,30, 2025.

Other expense, net increaseddecreased by $6 million to expense of $11$12 million in the three months ended MarchJune 31,30, 2026, from expense of $5$18 million in the three months ended MarchJune 31,30, 2025.

Income tax expense was $21$40 million in the three months ended MarchJune 31,30, 2026, compared to an income tax expense of $8$84 million in the three months ended MarchJune 31,30, 2025. The effective tax rate for the three months ended MarchJune 31,30, 2026, was 25.0%,31.3%, while the effective tax rate for the three months ended MarchJune 31,30, 2025, was 2.1%.144.8%.

The three and six months ended MarchJune 31,30, 2026, compared to the three and six months ended MarchJune 31,30, 2025

Net sales before intersegment eliminations for the North America segment decreased by $167$12 million, to $4,502$4,743 million in the three months ended MarchJune 31,30, 2026, from $4,669$4,755 million in the three months ended MarchJune 31,30, 2025. This decrease was primarily due to a lower volumesselling price mix of $259$46 million that was partially offset by a net positive foreign currency impact of $51$33 million and a $41 million impact from a higher selling price mix.million.

Adjusted EBITDA for the North America segment decreased by $188$48 million, to $597$704 million in the three months ended MarchJune 31,30, 2026, from $785$752 million in the three months ended MarchJune 31,30, 2025. This decrease was primarily due to a lower selling price mix of $46 million and higher costs of $176$7 million and the impact of lower volumes of $48 million that weremillion, partially offset by a higher$10 sellingmillion pricefavorable impact of product mix ofon $41 million.volume. Higher costs of $176$7 million were primarily due to economic downtime of $74 million, a $55 million impact of adverse weather, $38 million of higher freight costs andof $32$61 million, partially offset by lower downtime of $26 million ofand higherlower netraw energymaterial costs primarilyof due$14 to lower energy credits than in the prior year period.million.

Net sales before intersegment eliminations for the Europe, MEA and APAC segment increased by $189$48 million, to $2,771$2,826 million in the three months ended MarchJune 31,30, 2026, from $2,582$2,778 million in the three months ended MarchJune 31,30, 2025. This increase was primarily due to a net positive foreign currency impact of $238$77 million primarily due to the strengthening of the U.S. dollareuro against the euro,U.S. dollar, partially offset by a lower selling price mix of $49$18 million and lower volumes of $11 million.

AdjustedNet EBITDAsales before intersegment eliminations for the Europe, MEA and APAC segment increased by $32$237 million, to $421$5,597 million in the threesix months ended MarchJune 31,30, 2026, from $389$5,360 million in the threesix months ended MarchJune 31,30, 2025. TheThis increase was primarily due to lower costs of $40 million and a net positive foreign currency impact of $44$315 million thatprimarily weredue partlyto the strengthening of the euro against the U.S. dollar, partially offset by a lower selling price mix impactof $67 million and lower volumes of $49$11 million. The $40 million of lower costs was primarily due to $28 million of lower energy costs.

Net sales before intersegment eliminations for the LATAM segment increased by $27$41 million, to $540$559 million in the three months ended MarchJune 31,30, 2026, from $513$518 million in the three months ended MarchJune 31,30, 2025. This increase was primarily due to a net positive foreign currency impact.

AdjustedNet EBITDAsales before intersegment eliminations for the LATAM segment decreasedincreased by $6$68 million, to $109$1,099 million in the threesix months ended MarchJune 31,30, 2026, from $115$1,031 million in the threesix months ended MarchJune 31,30, 2025. This decreaseincrease was primarily due to highera costsnet ofpositive $10foreign millioncurrency due to higher raw material and energy costs.impact.

Smurfit Westrock’s primary sources of liquidity are the cash flows generated from its operations, its commercial paper program and committed credit lines. The uncommitted commercial paper program is supported by the $4,500 million revolving loan facility with a separate swingline sub-facility which allows for same-day drawing in U.S. dollar. The revolving credit facility had an original term of five years, with two one-year extension options. In June 2025,2026, we exercised the firstsecond one-year extension was exercised,option, extending the maturity date to June 28, 2030.2031. The amount of commercial paper outstanding does not reduce available capacity under the revolving loan facility. The primary uses of this liquidity are to fund Smurfit Westrock’s day-to-day operations, capital expenditures, debt service, dividends and other investment activity, including acquisitions.

As of MarchJune 31,30, 2026, Smurfit Westrock held cash and cash equivalents of $674$677 million, of which $156$137 million were held in euro, $197$205 million were held in U.S. dollars and $321$335 million were held in other currencies. At MarchJune 31,30, 2026, the Company had $4,663$4,562 million in undrawn committed facilities available under the revolving loan facility and receivables securitization facilities. The weighted average period until maturity of undrawn committed facilities was 4.15.0 years as of MarchJune 31,30, 2026. Combined with cash and cash equivalents of $674$677 million, the Company had $5,337$5,239 million of available liquidity.

As of MarchJune 31,30, 2026, Smurfit Westrock had $14,255$14,164 million of total debt. As of MarchJune 31,30, 2026, the carrying amount of current debt was $980$931 million. In the threesix months ended MarchJune 31,30, 2026, total debt increased by $482$391 million. Excluding changes in carrying value, such as translation adjustments and amortization moves, borrowings increased by $517$439 million. See “Note 9.10. Debt” of the Condensed Consolidated Financial Statements for additional debt-related information.

The Company engages in certain customer-based SCF programs to accelerate the receipt of payment for outstanding accounts receivables from certain customers. Certain costs of these programs are borne by the customer or the Company. Receivables transferred under these customer-based SCF programs generally meet the requirements to be accounted for as sales in accordance with guidance under “Transfers and Servicing” (“ASC 860”), resulting in derecognition of such receivables from the Company’s Condensed Consolidated Balance Sheets. Receivables involved with these customer-based SCF programs may vary from period to period, and were 6% of the Company’s accounts receivable balance at MarchJune 31,30, 2026. In addition, Smurfit Westrock has monetization facilities that sell to third-party financial institutions all of the short-term receivables generated from certain customer trade accounts. See “Note 8. Fair Value Measurement” of the Condensed Consolidated Financial Statements for a discussion of the Company’s monetization facilities.

Debt” andSee “Note 15.9. VariableFair InterestValue EntitiesMeasurement” of the Condensed Consolidated Financial Statements for a discussion of the receivables securitization facilities and the amount outstanding under the Company’s vendormonetization financing and commercial card programs.facilities.

Net cash provided by operating activities decreased by $31$95 million to $204$969 million in the threesix months ended MarchJune 31,30, 2026 from $235$1,064 million in the threesix months ended MarchJune 31,30, 2025, primarily due to a $188$106 million decrease in net income adjusted for non-cash items, primarily including depreciation, depletion and amortization, impairment of assets, cash surrender value increase in excess of premiums paid, share-based compensation expense, deferred income tax benefit, and pension and other postretirement funding more than cost. Changes in operating assets and liabilities were a benefit of $157$11 million compared to the prior year period. The decrease in the cash outflows from changes in operating assets and liabilities was inclusive of cash payments to financial institutions of $63$23 million in connection with the Company’s accounts receivable monetization agreements in the threesix months ended MarchJune 31,30, 2026, compared to cash payments of $39$12 million in the prior year period. See “Note 8.9. Fair Value Measurement” of the Condensed Consolidated Financial Statements for additional information.

Net cash used for investing activities of $627$1,075 million in the threesix months ended MarchJune 31,30, 2026 consisted primarily of capital expenditures of $624$1,089 million and cash paid for purchase of businesses, net of cash acquired of $18$19 million that were partially offset by proceeds from sale of property, plant and equipment of $9$19 million. Net cash used for investing activities of $476$996 million in the threesix months ended MarchJune 31,30, 2025 consisted primarily of capital expenditures of $477$999 million.

Net cash providedused byfor financing activities of $209$109 million in the threesix months ended MarchJune 31,30, 2026 consisted primarily of outflows from cash dividends paid to shareholders of $474 million and tax paid in connection with shares withheld from employees of $85 million that were partially offset by cash inflows from a net increase in debt of $517$439 million and proceeds from re-issuance of shares from treasury stock of $14 million. Net cash used for financing activities of $204 million thatin werethe partiallysix offsetmonths byended June 30, 2025 consisted primarily of cash outflows from cash dividends paid to shareholders of $237$450 million and tax paid in connection with shares withheld from employees of $83$67 million.million, Netpartially cash providedoffset by financing activities of $151 million in the three months ended March 31, 2025 consisted of cash inflows from a net increase in debt of $444 million, partially offset by cash outflows from dividends paid to shareholders of $225 million and tax paid in connection with shares withheld from employees of $64$318 million.

Smurfit Westrock is a party to enforceable and legally binding contractual obligations involving commitments to make payments to third parties. These obligations impact Smurfit Westrock’s short-term and long-term liquidity and capital resource needs. Certain contractual obligations are reflected on Smurfit Westrock’s Condensed Consolidated Balance Sheets as of MarchJune 31,30, 2026, while others are considered future obligations. Smurfit Westrock’s contractual obligations primarily consist of items such as long-term debt, including current portion, lease obligations, purchase obligations and other obligations.

As of MarchJune 31,30, 2026, Smurfit Westrock did not have any off-balance sheet arrangements.

Smurfit Westrock uses the non-GAAP financial measure “Adjusted EBITDA” to evaluate its overall performance. The composition of Adjusted EBITDA is not addressed or prescribed by GAAP. Smurfit Westrock defines Adjusted EBITDA as net income (loss) before income tax expense, depreciation, depletion and amortization, interest expense, net, pension and other postretirement non-service income, net, share-based compensation expense, other expense, net, impairment and restructuring costs, transaction and integration-related expenses associated with the Combination and other specific items that management believes are not indicative of the ongoing operating results of the business.

Management believes that the most directly comparable GAAP measure to Adjusted EBITDA is “Net income (loss)”.

Set forth below is a reconciliation of the non-GAAP financial measure Adjusted EBITDA to Net income,income (loss), the most directly comparable GAAP measure, for the periods presented ($ in millions).

On April 3, 2024, Smurfit Kappa Treasury Unlimited Company (“SKT”) completed a private offering of $750 million aggregate principal amount of 5.200% senior green notes due 2030, $1,000 million aggregate principal amount of 5.438% senior green notes due 2034 and $1,000 million aggregate principal amount of 5.777% senior green notes due 2054, which we refer to as the “Original SKT Notes”, and on November 26, 2024, Smurfit Westrock Financing Designated Activity Company (“SWF” and together with SKT, the “Issuers”) completed a private offering of $850 million aggregate principal amount of 5.418% senior green notes due 2035, which we refer to as the “Original SWF Notes” (and, together with the Original SKT Notes, the “Original Notes”). As part of those offerings, the Issuers and the Guarantors (as hereinafter defined) of the Original Notes entered into registration rights agreements with the initial purchasers thereof in which we agreed to use commercially reasonable efforts to complete exchange offers for such Original Notes in compliance with applicable securities laws. In connection with the registration rights agreements, on May 23, 2025, following an exchange offer process, certain holders of the Original Notes, exchanged their notes for newly issued registered notes (the “New Notes”). The New Notes are substantially identical to the Original Notes, except that the New Notes are registered under the United States Securities Act of 1933, as amended, and will not have any transfer restrictions, registration rights or additional interest provisions. On November 21, 2025, SWF issued $800 million aggregate principal amount of 5.185% senior green notes due 2036, and on November 24, 2025 SKT issued €500 million aggregate principal amount of 3.489% senior green notes due 2031.2031 (“November 2025 Notes”). These notes have been registered under the U.S. Securities Act of 1933, as amended.

The Original Notes, the New Notes and the November 2025 Notes areare, subject to any limitations under applicable law, fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by each of Smurfit Westrock plc and the following wholly-owned subsidiaries of Smurfit Westrock plc (the “Subsidiary Guarantors”): Smurfit Kappa Group Limited, Smurfit Kappa Investments Limited, Smurfit Kappa Acquisitions Unlimited Company, Smurfit Kappa Treasury Funding Designated Activity Company, Smurfit International B.V., Smurfit WestRock US Holdings Corporation, WestRock Company, WRKCo Inc., WestRock MWV, LLC and WestRock RKT, LLC. In addition, SWF fully and unconditionally guarantees SKT’s obligations under the Original Notes, the New Notes and the November 2025 Notes, and SKT fully and unconditionally guarantees SWF’s obligations under the Original Notes, the New Notes and the November 2025 Notes. SKT and SWF are both wholly-owned subsidiaries of Smurfit Westrock plc. Smurfit Westrock plc and the Subsidiary Guarantors are collectively referred to herein as the “Guarantors”, and the Issuers and the Guarantors are collectively referred to herein as the “Obligor Group”.

Operations are conducted almost entirely through Smurfit Westrock plc’s subsidiaries other than the Issuers and the Subsidiary Guarantors. Accordingly, the Obligor Group’s cash flow and ability to service its debt are dependent upon the earnings of Smurfit Westrock plc’s other non-obligor subsidiaries (the “Non-Obligor Subsidiaries”) and the distribution of those earnings to the Obligor Group, whether by dividends, loans or otherwise. Holders of the Original Notes, the New Notes and November 2025 Notes have a direct claim only against the Obligor Group.

There have been no material changes during the threesix months ended MarchJune 31,30, 2026 to Smurfit Westrock’s critical accounting policies and estimates as identified in Smurfit Westrock’s Annual Report on Form 10-K for the year ended December 31, 2025.