The impact on demand from inflation and industrywide destocking and a negative price/cost have led to a decline in Sonoco Products Co.'s revenues through the third quarter, which S&P Global Ratings projects will continue through the remainder of the year. Although we expect much of the destocking impact to moderate in fourth quarter to early 2024, high inflation could continue to diminish consumer spending into the new year. We expect Sonoco will remain focused on its cost controls, including further footprint optimization and productivity enhancements, to offset lower operating leverage, until it sees an inflection point in demand. S&P Global Rating-adjusted debt leverage increased in the third quarter to 3.4x from 3.1x the previous quarter due to the additional debt
