Supremex Q2 Earnings Call Highlights

Supremex TSE: SXP reported higher second-quarter revenue, improved profitability and a return to positive free cash flow, as growth in its packaging operations and improved envelope performance supported results for the period ended June 30, 2026.

Consolidated revenue increased 8.5% year over year to C$71.6 million, while adjusted EBITDA rose nearly 34% to C$7.8 million. Adjusted EBITDA margin expanded to 10.9% from 8.8% a year earlier.

President and CEO Stewart Emerson said the company’s revenue growth and margin expansion reflected improved volume and cost discipline, with operating and selling, general and administrative expenses increasing more slowly than revenue.

Packaging and specialty products revenue rose 19% to C$26.4 million during the quarter. The segment represented 37% of company revenue, compared with about one-third a year earlier.

Excluding Supremex’s smaller non-core commercial print business, the rest of the packaging segment, led by folding carton operations, grew 27.6% in the quarter, according to CFO Norm Macaulay.

Management attributed folding carton growth to increased business from multinational consumer packaged goods customers in health and beauty and over-the-counter pharmaceuticals, new customer wins, e-commerce packaging expansion and the contribution from the Trans-Graphique acquisition completed in July 2025.

Supremex completed the acquisition of Goldrich Printpak on June 5. Goldrich, which generates approximately C$30 million in revenue, provides the company with a folding carton manufacturing base in the Greater Toronto Area. The business was acquired on a cash-free, debt-free basis for approximately C$34 million, financed through a new acquisition term loan and the company’s credit facility.

Emerson told analysts that Goldrich was operating at roughly 75% to 80% capacity utilization and that the company had begun pursuing purchasing savings, production shifts and cross-selling opportunities. He said Supremex had already shifted some production previously handled at its Lachine and Indianapolis facilities to Goldrich because of freight advantages.

The company also acquired iFlex Labels, a small Saint-Laurent label manufacturer, during the quarter. Supremex plans to consolidate iFlex and its existing Laval label operation into its Lachine folding carton plant by the end of 2026. Emerson said the consolidation is intended to produce cost synergies and create more opportunities to cross-sell labels and folding cartons.

Packaging adjusted EBITDA was C$3.4 million, or 12.9% of segment revenue, compared with C$2.9 million a year earlier. The margin was essentially unchanged as higher volume was offset by commercial print softness and acquisition-related activity.

Macaulay said commercial print revenue declined by about C$500,000 in the quarter, while the unit’s gross margin fell by approximately C$700,000. Excluding commercial print, packaging adjusted EBITDA would have been approximately C$3.7 million, or 16.8% of segment revenue.