UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended ~~March 31,~~September 30, 2021


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-07349

BALL CORPORATION

State of Indiana

(State or other jurisdiction of incorporation or
organization)

35-0160610

(I.R.S. Employer Identification No.)

9200 West 108th Circle

Westminster, CO

(Address of registrant’s principal executive office)

80021

(Zip Code)

Registrant’s telephone number, including area code: 303/469-3131

Securities registered pursuant to section 12(b) of the Act:

Class		Trading Symbol		Name of Exchange		Outstanding at ~~April 30,~~October 31, 2021
Common Stock, without par value		BLL		NYSE		~~328,254,521~~323,894,182 shares

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒	Accelerated filer ◻
Non-accelerated filer ◻	Smaller reporting company◻
	Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

Table of Contents

Ball Corporation

QUARTERLY REPORT ON FORM 10-Q

For the period ended ~~March 31,~~September 30, 2021

INDEX

		Page Number

PART I.	FINANCIAL INFORMATION
		1
Item 1.	Financial Statements
		1
	Unaudited Condensed Consolidated Statements of Earnings for the Three and Nine Months Ended ~~March 31,~~September 30, 2021 and 2020	1

	Unaudited Condensed Consolidated Statements of Comprehensive Earnings (Loss) for the Three and Nine Months Ended ~~March 31,~~September 30, 2021 and 2020	2

	Unaudited Condensed Consolidated Balance Sheets at ~~March 31,~~September 30, 2021, and December 31, 2020	3

	Unaudited Condensed Consolidated Statements of Cash Flows for the ~~Three~~Nine Months Ended ~~March 31,~~September 30, 2021 and 2020	4

	Notes to the Unaudited Condensed Consolidated Financial Statements	5
	Note 1, Basis of Presentation	5
	Note 2, Accounting Pronouncements	6
	Note 3, Business Segment Information	6
	Note 4, Acquisitions and Dispositions	8
	Note 5, Revenue from Contracts with Customers	8
	Note 6, Business Consolidation and Other Activities	9
	Note 7, Supplemental Cash Flow Statement Disclosures	11
	Note 8, Receivables, Net	12
	Note 9, Inventories, Net	12
	Note 10, Property, Plant and Equipment, Net	12
	Note 11, Goodwill	12
	Note 12, Intangible Assets, Net	13
	Note 13, Other Assets	13
	Note 14, Leases	13
	Note 15, Debt	14
	Note 16, Taxes on Income	15
	Note 17, Employee Benefit Obligations	15
	Note 18, Equity and Accumulated Other Comprehensive Earnings	17
	Note 19, Earnings and Dividends Per Share	19
	Note 20, Financial Instruments and Risk Management	19
	Note 21, Contingencies	24
	Note 22, Indemnifications and Guarantees	26
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
		37
Item 4.	Controls and Procedures	35
		38
PART II.	OTHER INFORMATION	3538

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

Three Months Ended March 31,
($ in millions, except per share amounts)

2021

2020

Net sales

$
3,125

$
2,785

Costs and expenses

Cost of sales (excluding depreciation and amortization)

(2,493)

(2,215)
Depreciation and amortization

(168)

(169)
Selling, general and administrative

(157)

(131)
Business consolidation and other activities

(7)

(115)

(2,825)

(2,630)

Earnings before interest and taxes

300

155

Interest expense

(67)

(71)
Debt refinancing and other costs

—

(40)
Total interest expense

(67)

(111)

Earnings before taxes

233

44
Tax (provision) benefit

(32)

4
Equity in results of affiliates, net of tax

(1)

(25)
Net earnings

200

23
Net (earnings) loss attributable to noncontrolling interests

—

—
Net earnings attributable to Ball Corporation

$
200

$
23

Earnings per share:

Basic

$
0.61

$
0.07
Diluted

$
0.60

$
0.07

Weighted average shares outstanding: (000s)

Basic

327,811

325,346
Diluted

333,673

332,326


	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions, except per share amounts)	2021		2020		2021		2020

Net sales	$	3,553	$	3,093	$	10,137	$	8,679

Costs and expenses
Cost of sales (excluding depreciation and amortization)		(2,851)		(2,430)		(8,104)		(6,875)
Depreciation and amortization		(175)		(160)		(515)		(499)
Selling, general and administrative		(148)		(121)		(471)		(363)
Business consolidation and other activities		(141)		(8)		(136)		(235)
		(3,315)		(2,719)		(9,226)		(7,972)

Earnings before interest and taxes		238		374		911		707

Interest expense		(68)		(68)		(201)		(206)
Debt refinancing and other costs		(1)		(1)		(1)		(41)
Total interest expense		(69)		(69)		(202)		(247)

Earnings before taxes		169		305		709		460
Tax (provision) benefit		2		(73)		(146)		(92)
Equity in results of affiliates, net of tax		8		8		18		(13)
Net earnings		179		240		581		355
Net (earnings) loss attributable to noncontrolling interests		—		1		—		3
Net earnings attributable to Ball Corporation	$	179	$	241	$	581	$	358


Earnings per share:
Basic	$	0.55	$	0.74	$	1.78	$	1.10
Diluted	$	0.54	$	0.72	$	1.75	$	1.08


Weighted average shares outstanding: (000s)
Basic		325,876		326,549		327,097		325,965
Diluted		331,595		332,654		332,938		332,152

See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)

Three Months Ended March 31,
($ in millions)
2021

2020

Net earnings
$
200

$
23

Other comprehensive earnings (loss):

Foreign currency translation adjustment

(12)

(224)
Pension and other postretirement benefits

41

(8)
Derivatives designated as hedges

46

8
Total other comprehensive earnings (loss)

75

(224)
Income tax (provision) benefit

(18)

(5)
Total other comprehensive earnings (loss), net of tax

57

(229)

Total comprehensive earnings (loss)

257

(206)
Comprehensive (earnings) loss attributable to noncontrolling interests

—

—
Comprehensive earnings (loss) attributable to Ball Corporation
$
257

$
(206)


	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020

Net earnings	$	179	$	240	$	581	$	355

Other comprehensive earnings (loss):
Currency translation adjustment		(17)		(130)		19		(292)
Pension and other postretirement benefits		193		9		242		(2)
Derivatives designated as hedges		16		44		122		63
Total other comprehensive earnings (loss)		192		(77)		383		(231)
Income tax (provision) benefit		(48)		(10)		(82)		(14)
Total other comprehensive earnings (loss), net of tax		144		(87)		301		(245)

Total comprehensive earnings (loss)		323		153		882		110
Comprehensive (earnings) loss attributable to noncontrolling interests		—		1		—		3
Comprehensive earnings (loss) attributable to Ball Corporation	$	323	$	154	$	882	$	113

See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Assets
Current assets
Cash and cash equivalents	$	461	$	1,366	$	1,446	$	1,366
Receivables, net		2,115		1,738		2,489		1,738
Inventories, net		1,399		1,353		1,638		1,353
Other current assets		262		218		344		218
Total current assets		4,237		4,675		5,917		4,675
Noncurrent assets
Property, plant and equipment, net		5,570		5,351		6,170		5,351
Goodwill		4,416		4,484		4,407		4,484
Intangible assets, net		1,813		1,883		1,732		1,883
Other assets		1,943		1,859		1,906		1,859
Total assets	$	17,979	$	18,252	$	20,132	$	18,252

Liabilities and Equity
Current liabilities
Short-term debt and current portion of long-term debt	$	766	$	17	$	762	$	17
Accounts payable		3,355		3,430		4,210		3,430
Accrued employee costs		277		347		364		347
Other current liabilities		586		650		795		650
Total current liabilities		4,984		4,444		6,131		4,444
Noncurrent liabilities
Long-term debt		6,941		7,783		7,755		7,783
Employee benefit obligations		1,395		1,613		1,322		1,613
Deferred taxes		616		634		673		634
Other liabilities		489		441		486		441
Total liabilities		14,425		14,915		16,367		14,915

Equity
Common stock (680,013,693 shares issued - 2021; 679,524,325 shares issued - 2020)		1,171		1,167
Common stock (680,667,421 shares issued - 2021; 679,524,325 shares issued - 2020)						1,209		1,167
Retained earnings		6,342		6,192		6,611		6,192
Accumulated other comprehensive earnings (loss)		(897)		(954)		(653)		(954)
Treasury stock, at cost (351,899,273 shares - 2021; 351,938,709 shares - 2020)		(3,124)		(3,130)
Treasury stock, at cost (355,842,472 shares - 2021; 351,938,709 shares - 2020)						(3,463)		(3,130)
Total Ball Corporation shareholders' equity		3,492		3,275		3,704		3,275
Noncontrolling interests		62		62		61		62
Total equity		3,554		3,337		3,765		3,337
Total liabilities and equity	$	17,979	$	18,252	$	20,132	$	18,252

See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three Months Ended March 31,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020

Cash Flows from Operating Activities
Net earnings	$	200	$	23	$	581	$	355
Adjustments to reconcile net earnings to cash provided by (used in) operating activities:
Depreciation and amortization		168		169		515		499
Business consolidation and other activities		7		115		136		235
Deferred tax provision (benefit)		(2)		(36)		34		(23)
Other, net		(147)		58		(142)		7
Changes in working capital components, net of dispositions		(703)		(1,037)		(248)		(728)
Cash provided by (used in) operating activities		(477)		(708)		876		345
Cash Flows from Investing Activities
Capital expenditures		(363)		(213)		(1,204)		(683)
Business acquisitions, net of cash acquired						—		(69)
Business dispositions, net of cash sold		1		(17)		111		(17)
Other, net		14		(4)		(11)		18
Cash provided by (used in) investing activities		(348)		(234)		(1,104)		(751)
Cash Flows from Financing Activities
Long-term borrowings		—		1,252		850		2,552
Repayments of long-term borrowings		(6)		(1,547)		(14)		(2,792)
Net change in short-term borrowings		7		493		10		(3)
Proceeds (payments) from issuances of common stock, net of shares used for taxes		5		(31)		31		(12)
Acquisitions of treasury stock		(10)		(57)		(356)		(57)
Common stock dividends		(50)		(51)		(164)		(149)
Other, net		—		(34)		(30)		(60)
Cash provided by (used in) financing activities		(54)		25		327		(521)

Effect of exchange rate changes on cash		(31)		(78)		(22)		(96)

Change in cash, cash equivalents and restricted cash		(910)		(995)		77		(1,023)
Cash, cash equivalents and restricted cash - beginning of period		1,381		1,806		1,381		1,806
Cash, cash equivalents and restricted cash - end of period	$	471	$	811	$	1,458	$	783

See accompanying notes to the unaudited condensed consolidated financial statements.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements (consolidated financial statements) include the accounts of Ball Corporation and its controlled affiliates, including its consolidated variable interest entities (collectively Ball, the company, we or our), and have been prepared by the company. Certain information and footnote disclosures, including critical and significant accounting policies normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted for this quarterly presentation.

Results of operations for the periods shown are not necessarily indicative of results for the year, particularly in view of the seasonality in the packaging segments and the variability of contract sales in the company’s aerospace segment. These ~~unaudited condensed~~ consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and the notes thereto included in the company’s 2020 Annual Report on Form 10-K filed on February 17, 2021, pursuant to the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2020 (annual report).

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires Ball’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and reported amounts of sales and expenses during the reporting periods. These estimates are based on historical experience and various assumptions believed to be reasonable under the circumstances. Ball’s management evaluates these estimates on an ongoing basis and adjusts or revises the estimates as circumstances change. As future events and their impacts cannot be determined with precision, actual results may differ from these estimates. In the opinion of management, the consolidated financial statements reflect all adjustments that are of a normal recurring nature and are necessary to fairly state the results of the periods presented.

Certain prior year amounts have been reclassified in order to conform to the current year presentation.

Risks and Uncertainties – Novel Coronavirus (COVID-19)

The preparation of consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the reporting date and revenues and expenses during the reporting periods. These estimates represent management’s judgement about the outcome of future events. The current global business environment ~~is being~~continues to be impacted directly and indirectly by the effects of the ongoing novel coronavirus (COVID-19), pandemic, and it is not possible to accurately estimate the impacts of ~~COVID-19.~~COVID-19 and its emerging variants. However, Ball management has reviewed the estimates used in preparing the company’s consolidated financial statements and the following have a reasonably possible likelihood of being affected, to a material extent, by the direct and indirect impacts of COVID-19 in the near term.

●

Estimates regarding the future financial performance of the business used in the company’s impairment tests for goodwill, long-lived assets, equity method investments, recoverability of deferred tax assets and estimates regarding cash needs and associated indefinite reinvestment assertions;

●

Estimates of recoverability for customer receivables;

●

Estimates of net realizable value for inventory;

●

Estimates regarding the likelihood of forecasted transactions associated with hedge accounting positions at ~~March 31,~~September 30, 2021, which could impact the company’s ability to satisfy hedge accounting requirements and result in the recognition of income and/or expenses.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

In addition to the above potential impacts on the estimates used in preparing consolidated financial statements, COVID-19 has the potential to increase Ball’s vulnerabilities to near-term severe impacts related to certain concentrations in its business. In line with other companies in the packaging and aerospace industries, Ball makes the majority of its sales and significant purchases to or from a relatively small number of global, or large regional, customers and suppliers. Furthermore, Ball makes the majority of its sales from a small number of product lines. The potential of COVID-19 to affect a significant customer or supplier, or to affect demand for certain products to a significant degree, heightens the vulnerability of Ball to these concentrations.

~~Table of Contents~~

~~Ball Corporation~~

~~Notes to the Unaudited Condensed Consolidated Financial Statements~~

2. Accounting Pronouncements

Recently Adopted Accounting Standards

Income Tax Simplification

In December 2019, new guidance was issued to simplify the accounting for income taxes. Ball adopted this guidance and all related amendments on January 1, 2021, applying either the retrospective basis, the modified retrospective method, or the prospective method where appropriate. The adoption of this guidance had no impact on the company’s ~~unaudited condensed~~ consolidated financial statements.

3. Business Segment Information

Ball’s operations are organized and reviewed by management along its product lines and geographical areas and presented in the 4 reportable segments outlined below.

Beverage packaging, North and Central America: Consists of operations in the U.S., Canada and Mexico that manufacture and sell ~~metal~~aluminum beverage containers throughout those countries.

Beverage packaging, EMEA: Consists of operations in numerous countries throughout Europe, including Russia, as well as Egypt and Turkey, that manufacture and sell ~~metal~~aluminum beverage containers throughout those regions.

Beverage packaging, South America: Consists of operations in Brazil, Argentina, Paraguay and Chile that manufacture and sell ~~metal~~aluminum beverage containers throughout most of South America.

Aerospace: Consists of operations that manufacture and sell aerospace and other related products and provide services used in the defense, civil space and commercial space industries.

As presented in the table below, Other consists of a non-reportable operating segment (beverage packaging, other) that manufactures and sells aluminum beverage containers in India, Saudi Arabia and throughout the Asia Pacific region; a non-reportable operating segment that manufactures and sells extruded aluminum aerosol containers and aluminum slugs (aerosol packaging); throughout North America, South America, Europe, and Asia; a non-reportable operating segment that manufactures and sells aluminum cups (aluminum cups); undistributed corporate expenses; intercompany eliminations and other business activities.

The accounting policies of the segments are the same as those used in the company’s consolidated financial statements as discussed in Note 1.1. The company also has investments in operations in Guatemala, Panama, ~~South Korea,~~ the U.S. and Vietnam that are accounted for under the equity method of accounting and, accordingly, those results are not included in segment sales or earnings. In the third quarter of 2021, Ball sold its minority-owned investment in South Korea. Refer to Note 4 for additional details.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Summary of Business by Segment


	Three Months Ended March 31,				Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020		2021		2020

Net sales
Beverage packaging, North and Central America	$	1,296	$	1,181	$	1,519	$	1,327	$	4,339	$	3,775
Beverage packaging, EMEA		796		669		937		809		2,639		2,177
Beverage packaging, South America		487		405		462		432		1,401		1,166
Aerospace		424		432		498		451		1,381		1,321
Reportable segment sales		3,003		2,687		3,416		3,019		9,760		8,439
Other		122		98		137		74		377		240
Net sales	$	3,125	$	2,785	$	3,553	$	3,093	$	10,137	$	8,679

Comparable operating earnings
Beverage packaging, North and Central America	$	140	$	146	$	186	$	209	$	519	$	544
Beverage packaging, EMEA		100		68		125		117		349		248
Beverage packaging, South America		93		63		74		64		245		173
Aerospace		35		40		46		44		115		114
Reportable segment comparable operating earnings		368		317		431		434		1,228		1,079
Reconciling items
Other (a)		(23)		(10)		(14)		(15)		(67)		(26)
Business consolidation and other activities		(7)		(115)		(141)		(8)		(136)		(235)
Amortization of acquired intangibles		(38)		(37)		(38)		(37)		(114)		(111)
Earnings before interest and taxes		300		155		238		374		911		707
Interest expense		(67)		(71)		(68)		(68)		(201)		(206)
Debt refinancing and other costs		—		(40)		(1)		(1)		(1)		(41)
Total interest expense		(67)		(111)		(69)		(69)		(202)		(247)
Earnings before taxes	$	233	$	44	$	169	$	305	$	709	$	460

(a)	Includes undistributed corporate expenses, net, of $~~$26~~17 million and $~~$14~~13 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $71 million and $33 million for the nine months ended September 30, 2021 and 2020, respectively.

The company does not disclose total assets by segment as itsuch information is not provided to the chief operating decision maker.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

4. Acquisitions and Dispositions

South Korea Investment

In the third quarter of 2021, Ball sold its minority-owned investment in South Korea. Consideration for the transaction was cash of $120 million, of which $110 million has been received, and is presented in business dispositions in cash flows from investing activities in Ball’s unaudited condensed consolidated statements of cash flows. The remaining $10 million will be received on or before December 31, 2022, and is presented in other assets on Ball’s unaudited condensed consolidated balance sheets. In the second quarter of 2021, the company recorded a loss of $5 million related to the disposal, which is presented in business consolidation and other activities in the unaudited condensed consolidated statement of earnings. See Note 6 for further details.

Brazil Aluminum Aerosol Packaging Business

In ~~August~~the third quarter of 2020, the company acquired the entire share capital of Tubex Industria E Comercio de Embalagens Ltda, an aluminum aerosol packaging business with a plant in Itupeva, Brazil, for the purchase price of $80 million, subject to customary closing adjustments, including initial cash consideration of $69 million plus potential additional consideration not to exceed $30 million in ~~total over the next~~ ~~three years.~~total. The business is part of Ball’s aerosol packaging operating segment. The transaction broadens the geographic reach of Ball’s aluminum aerosol packaging business, serving the growing Brazilian personal care market.

5. Revenue from Contracts with Customers

Disaggregation of Sales

The company disaggregates net sales by reportable segments as disclosed in Note 3, and based on the timing of transfer of control for goods and services as explained below. The transfer of control for goods and services may occur at a point in time or over time.

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~~Ball Corporation~~

~~Notes to the Unaudited Condensed Consolidated Financial Statements~~

The following table disaggregates the company’s net sales based on the timing of transfer of control:


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	Point in Time		Over Time		Total		Point in Time		Over Time		Total		Point in Time		Over Time		Total

2021	$	610	$	2,515	$	3,125	$	603	$	2,950	$	3,553	$	1,837	$	8,300	$	10,137
2020		503		2,282		2,785		604		2,489		3,093		1,638		7,041		8,679

Contract Balances

~~The company enters into contracts to sell beverage packaging, aerosol packaging, and aerospace products and services.~~ The company did not have any contract assets at either ~~March 31,~~September 30, 2021, or December 31, 2020. Unbilled receivables, which are not classified as contract assets, represent arrangements in which sales have been recorded prior to billing and right to payment is unconditional.

The opening and closing balances of the company’s current and noncurrent contract liabilities are as follows:


	Contract		Contract		Contract		Contract
	Liabilities		Liabilities		Liabilities		Liabilities
($ in millions)	(Current)		(Noncurrent)		(Current)		(Noncurrent)

Balance at December 31, 2020	$	108	$	29	$	108	$	29
Increase (decrease)		(19)		(1)		118		6
Balance at March 31, 2021	$	89	$	28
Balance at September 30, 2021					$	226	$	35

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

During the ~~three~~nine months ended ~~March 31,~~September 30, 2021, total contract liabilities ~~decreased~~increased by ~~$20~~$124 million, which is net of cash received of ~~$103~~$503 million and amounts recognized as sales of ~~$123~~$379 million, ~~all~~the majority of which related to current contract liabilities. The amount of sales recognized in the ~~three~~nine months ended ~~March 31,~~September 30, 2021, which were included in the opening contract liabilities balances, was $108 million, all of which related to current contract liabilities. Current contract liabilities are classified within other current liabilities on the unaudited condensed consolidated balance sheet and noncurrent contract liabilities are classified within other liabilities.

The company also recognized net sales of $7 million and $9 million in the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and net sales of $18 million and $12 million in the nine months ended September 30, 2021 and 2020, respectively, from performance obligations satisfied (or partially satisfied) in prior periods. These sales amounts are the result of changes in the transaction price of the company’s contracts with customers.

Transaction Price Allocated to Remaining Performance Obligations

The table below discloses: (1) the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied (or partially unsatisfied) as of the end of the reporting period for contracts with an original duration of greater than one year, and (2) when the company expects to record sales on these multi-year contracts.


($ in millions)	Next Twelve Months		Thereafter		Total		Next Twelve Months		Thereafter		Total

Sales expected to be recognized on multi-year contracts in place as of March 31, 2021	$	1,387	$	746	$	2,133
Sales expected to be recognized on multi-year contracts in place as of September 30, 2021							$	1,398	$	1,290	$	2,688

~~Table of Contents~~

~~Ball Corporation~~

~~Notes to the Unaudited Condensed Consolidated Financial Statements~~

6. Business Consolidation and Other Activities

The following is a summary of business consolidation and other activity (charges)/income included in the unaudited condensed consolidated statements of earnings:


	Three Months Ended March 31,				Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020		2021		2020

Beverage packaging, North and Central America	$	1	$	(3)	$	—	$	—	$	(1)	$	(4)
Beverage packaging, EMEA		(2)		(3)		(2)		(2)		(5)		(8)
Beverage packaging, South America		(1)		(1)		(9)		3		11		(1)
Other		(5)		(108)		(130)		(9)		(141)		(222)
	$	(7)	$	(115)	$	(141)	$	(8)	$	(136)	$	(235)

2021

Beverage Packaging, North and Central America

During the ~~three~~nine months ended ~~March 31,~~September 30, 2021, the company recorded ~~credits~~net charges of $1 million for individually insignificant activities in connection with previously announced closures of certain plants and other activities.

Beverage Packaging, EMEA

During the three and nine months ended ~~March 31,~~September 30, 2021, the company recorded charges of $2 million and $5 million, respectively, for individually insignificant activities in connection with previously announced plant closures, restructuring and other ~~activities.~~

~~Beverage Packaging, South America~~

~~During the three months ended March 31, 2021, the company recorded charges of $1 million for individually insignificant activities.~~

~~Other~~

~~During the three months ended March 31, 2021, the company recorded charges of $5 million for individually insignificant activities.~~

~~2020~~

~~Beverage Packaging, North and Central America~~

During the three months ended March 31, 2020, the company recorded charges of $3 million for individually insignificant activities in connection with previously announced closures of certain beverage can and end manufacturing facilities and other activities.

~~Beverage Packaging, EMEA~~

~~During the three months ended March 31, 2020, the company recorded charges of $3 million~~ ~~for individually insignificant activities in connection with previously announced plant closures, restructuring and other activities.~~

~~Beverage Packaging, South America~~

~~During the three months ended March 31, 2020, the company recorded charges of $1 million for individually insignificant~~ activities.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Beverage Packaging, South America

During the nine months ended September 30, 2021, the company recorded a $22 million gain related to indirect tax gain contingencies in Brazil as these amounts are now estimable and realizable. The company’s Brazilian subsidiaries filed lawsuits in 2014 and 2015 to challenge the Brazilian tax authorities regarding the computation of certain indirect taxes, claiming amounts were overpaid to the tax authorities because the tax base included a “tax on tax” component. See Note 21 for further details. During the three and nine months ended September 30, 2021, the company recorded charges of $4 million in connection with previously announced plant closures. Additional charges in the three and nine months ended September 30, 2021, were $5 million and $7 million, respectively, for individually insignificant activities.

Other

During the three months ended ~~March 31,~~September 30, 2021, the company recorded the following amounts:

●

A non-cash settlement loss of $130 million related to the purchase of non-participating group annuity contracts and lump-sum payments to settle the projected pension benefit obligations for certain of Ball’s U.S. defined benefit pension plans, which triggered settlement accounting. The settlement loss primarily reflects the third quarter recognition of unamortized actuarial losses in these U.S. pension plans.

During the nine months ended September 30, 2021, the company recorded the following amounts:

●

A loss of $5 million related to the sale of its minority-owned investment in South Korea. See Note 4 for further details.

●

Charges of $6 million for individually insignificant activities.

2020

Beverage Packaging, North and Central America

During the nine months ended September 30, 2020, the company recorded charges of $4 million for individually insignificant activities.

Beverage Packaging, EMEA

During the three and nine months ended September 30, 2020, the company recorded charges of $2 million and $8 million, respectively, for individually insignificant activities.

Beverage Packaging, South America

During the three and nine months ended September 30, 2020, the company recorded credits of $3 million and charges of $1 million, respectively, for individually insignificant activities.

Other

During the three months ended September 30, 2020, the company recorded the following amounts:

●

Settlement charges of $5 million associated with lump-sum payments made to settle the projected pension benefit obligations for certain of Ball’s U.S. defined benefit pension plans.

●

Charges of $4 million for individually insignificant activities.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

During the nine months ended September 30, 2020, the company recorded the following amounts:

●

A non-cash settlement loss of $102 million related to the purchase of non-participating group annuity contracts and lump-sum payments to settle the projected pension benefit obligations for certain of Ball’s U.S. defined benefit pension plans, which triggered settlement accounting. The settlement loss primarily reflects the second quarter recognition of aggregate unamortized actuarial losses in these U.S. pension plans.

●

A non-cash impairment charge of $62 million related to the goodwill of the beverage packaging, other, operating segment. See Note 11 for further details.

●

A non-cash charge of $23 million resulting from the deterioration of China’s real estate market in 2020, which led the company to reduce the value of potential future consideration due as part of the 2019 sale of its China beverage packaging business.

●

Charges of $15 million resulting from an adjustment to the selling price of the company’s former steel food and aerosol business.

●

A credit of $11 million related to the reversal of reserves against working capital recorded in 2019 in the beverage packaging, other, segment, as previously at-risk balances were subsequently collected.

●

Charges of $6 million for long-term incentive and other compensation arrangements associated with the 2016 Rexam acquisition.

●

Charges of ~~$13~~$25 million for individually insignificant activities.

7.	Supplemental Cash Flow Statement Disclosures


	March 31,				September 30,
($ in millions)	2021		2020		2021		2020

Beginning of period:
Cash and cash equivalents	$	1,366	$	1,798	$	1,366	$	1,798
Current restricted cash (included in other current assets)		15		8		15		8
Total cash, cash equivalents and restricted cash	$	1,381	$	1,806	$	1,381	$	1,806

End of period:
Cash and cash equivalents	$	461	$	801	$	1,446	$	771
Current restricted cash (included in other current assets)		10		10		12		12
Total cash, cash equivalents and restricted cash	$	471	$	811	$	1,458	$	783

The company’s restricted cash is primarily related to receivables factoring programs and represents amounts collected from customers that have not yet been remitted to the banks as of the end of the reporting period.

Noncash investing activities include the acquisition of property, plant and equipment (PP&E) for which payment has not been made. These noncash capital expenditures are excluded from the statement of cash flows. The PP&E acquired but not yet paid for amounted to approximately ~~$515~~$550 million at ~~March 31,~~September 30, 2021, and $409 million at December 31, 2020.

8. Receivables, Net


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Trade accounts receivable	$	1,012	$	825	$	1,282	$	825
Unbilled receivables		637		528		702		528
Less: Allowance for doubtful accounts		(9)		(9)		(8)		(9)
Net trade accounts receivable		1,640		1,344		1,976		1,344
Other receivables		475		394		513		394
	$	2,115	$	1,738	$	2,489	$	1,738

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The company has entered into several regional committed and uncommitted accounts receivable factoring programs with various financial institutions for certain of its receivables. The programs are accounted for as true sales of the receivables, without recourse to Ball, and had combined limits of approximately $1.7 billion at September 30, 2021, and $1.6 billion at ~~March 31, 2021, and~~ December 31, 2020. A total of ~~$348~~$430 million and $232 million were available for sale under these programs as of ~~March 31,~~September 30, 2021, and December 31, 2020, respectively.

Other receivables include income and sales tax receivables and other miscellaneous receivables.

9. Inventories, Net


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Raw materials and supplies	$	868	$	889	$	1,012	$	889
Work-in-process and finished goods		624		557		716		557
Less: Inventory reserves		(93)		(93)		(90)		(93)
	$	1,399	$	1,353	$	1,638	$	1,353

10. Property, Plant and Equipment, Net


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Land	$	161	$	163	$	165	$	163
Buildings		1,708		1,653		1,944		1,653
Machinery and equipment		6,338		6,214		6,736		6,214
Construction-in-progress		990		883		1,130		883
		9,197		8,913		9,975		8,913
Accumulated depreciation		(3,627)		(3,562)		(3,805)		(3,562)
	$	5,570	$	5,351	$	6,170	$	5,351

Depreciation expense amounted to ~~$123~~$130 million and ~~$124~~$115 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $380 million and $365 million for the nine months ended September 30, 2021 and 2020, respectively.

11. Goodwill


($ in millions)	Beverage Packaging, North & Central America		Beverage Packaging, EMEA		Beverage Packaging, South America		Aerospace		Other		Total		Beverage Packaging, North & Central America		Beverage Packaging, EMEA		Beverage Packaging, South America		Aerospace		Other		Total

Balance at December 31, 2020	$	1,275	$	1,573	$	1,298	$	40	$	298	$	4,484	$	1,275	$	1,573	$	1,298	$	40	$	298	$	4,484
Effects of currency exchange		—		(56)		—		—		(12)		(68)		—		(64)		—		—		(13)		(77)
Balance at March 31, 2021	$	1,275	$	1,517	$	1,298	$	40	$	286	$	4,416
Balance at September 30, 2021													$	1,275	$	1,509	$	1,298	$	40	$	285	$	4,407

Goodwill in the above table is presented net of accumulated impairment losses of $62 million as of ~~March 31,~~September 30, 2021 and December 31, 2020.

In the first quarter of 2020, Ball recorded a non-cash impairment charge of $62 million related to the goodwill associated with the beverage packaging, other, reporting unit as the carrying amount of this reporting unit exceeded its fair value. The impairment review was triggered by the restructuring of the company’s reporting units which was made in connection with a January 1, 2020 change in segment management and internal reporting structure.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

12. Intangible Assets, Net


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Acquired customer relationships and other intangibles (net of accumulated amortization of $756 million at March 31, 2021, and $729 million at December 31, 2020)	$	1,721	$	1,785
Capitalized software (net of accumulated amortization of $201 million at March 31, 2021, and $196 million at December 31, 2020)		66		69
Other intangibles (net of accumulated amortization of $93 million at March 31, 2021, and $124 million at December 31, 2020)		26		29
Acquired customer relationships and other intangibles (net of accumulated amortization of $830 million at September 30, 2021, and $729 million at December 31, 2020)					$	1,642	$	1,785
Capitalized software (net of accumulated amortization of $186 million at September 30, 2021, and $196 million at December 31, 2020)						66		69
Other intangibles (net of accumulated amortization of $96 million at September 30, 2021, and $124 million at December 31, 2020)						24		29
	$	1,813	$	1,883	$	1,732	$	1,883

Total amortization expense of intangible assets amounted to $45 million ~~and $45 million~~ for the three months ended ~~March 31,~~September 30, 2021 and 2020, and $135 million and $134 million for the nine months ended September 30, 2021 and 2020, respectively.

13. Other Assets


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Long-term pension assets	$	572	$	562	$	569	$	562
Investments in affiliates		306		321		182		321
Right-of-use operating lease assets		380		302		406		302
Long-term deferred tax assets		192		227		154		227
Other		493		447		595		447
	$	1,943	$	1,859	$	1,906	$	1,859

In the third quarter of 2021, Ball sold its minority-owned investment in South Korea for total proceeds of $120 million. See Note 4 for further details. In the first quarter of 2020, the shareholders of Ball Metalpack provided additional equity contributions and loans to Ball Metalpack, of which Ball's share was $30 million, which resulted in Ball recognizing this same level of previously unrecorded equity method losses associated with prior periods. These losses are presented in equity in results of affiliates, net of tax, in the company’s unaudited condensed consolidated statement of earnings. Ball is under no obligation to provide additional equity contributions or loans to Ball Metalpack.

14. Leases

The company enters into operating leases for buildings, warehouses, office equipment, production equipment, aircraft, land and other types of equipment. The company also enters into finance leases for certain plant equipment.

~~Supplemental balance sheet information related to the company’s leases follows:~~

��

March 31,

December 31,
($ in millions)
Balance Sheet Location

2021

2020

Operating leases:

Operating lease ROU asset
Other assets

$
380

$
302
Current operating lease liabilities
Other current liabilities

73

63
Noncurrent operating lease liabilities
Other liabilities

301

232
Finance leases:

Finance lease ROU assets, net
Property, plant and equipment, net

$
10

$
11
Current finance lease liabilities
Short-term debt and current portion of long-term debt

2

2
Noncurrent finance lease liabilities
Long-term debt

9

10

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Supplemental balance sheet information related to the company’s leases follows:


		September 30,		December 31,
($ in millions)	Balance Sheet Location	2021		2020

Operating leases:
Operating lease ROU asset	Other assets	$	406	$	302
Current operating lease liabilities	Other current liabilities		79		63
Noncurrent operating lease liabilities	Other liabilities		329		232
Finance leases:
Finance lease ROU assets, net	Property, plant and equipment, net	$	10	$	11
Current finance lease liabilities	Short-term debt and current portion of long-term debt		2		2
Noncurrent finance lease liabilities	Long-term debt		8		10

15. Debt

Long-term debt consisted of the following:


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Senior Notes
5.00% due March 2022	$	743	$	748	$	736	$	748
4.00% due November 2023		1,000		1,000		1,000		1,000
4.375%, euro denominated, due December 2023		821		855		811		855
0.875%, euro denominated, due March 2024		880		916		869		916
5.25% due July 2025		1,000		1,000		1,000		1,000
4.875% due March 2026		750		750		750		750
1.50%, euro denominated, due March 2027		645		672		637		672
2.875% due August 2030		1,300		1,300		1,300		1,300
3.125% due September 2031						850		—
Senior Credit Facility (at variable rates)
Term A loan due March 2024		593		593		593		593
Finance lease obligations		11		12		10		12
Other (including debt issuance costs)		(57)		(60)		(63)		(60)
		7,686		7,786		8,493		7,786
Less: Current portion		(745)		(3)		(738)		(3)
	$	6,941	$	7,783	$	7,755	$	7,783

The company’s senior credit facilities include long-term multi-currency revolving facilities that mature in March 2024, which provide the company with up to the U.S. dollar equivalent of $1.75 billion. At ~~March 31,~~September 30, 2021, taking into account outstanding letters of credit, $1.7 billion was available under the company’s long-term, revolving credit facilities. In addition to these facilities, the company had approximately $1 billion of short-term uncommitted credit facilities available at ~~March 31,~~September 30, 2021, of which ~~$21~~$24 million was outstanding and due on demand. At December 31, 2020, the company had $14 million outstanding under short-term uncommitted credit facilities.

In the third quarter of 2021, Ball issued $850 million of 3.125% senior notes due 2031. In the fourth quarter of 2021, Ball redeemed the outstanding 5.00% senior notes due in March 2022 in the amount of $736 million.

The fair value of long-term debt was estimated to be ~~$8.1~~$8.9 billion at ~~March 31,~~September 30, 2021, and $8.3 billion at December 31, 2020. The fair value reflects the market rates at each period end for debt with credit ratings similar to the company’s ratings and is classified as Level 2 within the fair value hierarchy. Rates currently available to the company for loans with similar terms and maturities are used to estimate the fair value of long-term debt based on discounted cash flows.

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The U.S. note agreements and bank credit agreement contain certain restrictions relating to dividend payments, share repurchases, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The company’s most restrictive debt covenant requires the company to maintain a leverage ratio (as defined) of no greater than 5.0 times as of ~~March 31,~~September 30, 2021, which will change to 4.5 times as of December 31, 2022. The company was in compliance with all loan agreements and debt covenants at both ~~March 31,~~September 30, 2021, and December 31, 2020, and it has met all debt payment obligations.

16. Taxes on Income

The company’s effective tax rate was ~~13.7~~negative 1.2 percent and ~~negative 9.1~~20.6 percent for the three and nine months ended ~~March 31,~~September 30, 2021, respectively. As compared to the statutory U.S. tax rate, the effective tax rate for the three and nine months ended September 30, 2021, was reduced by 13.9 and 5.8 percentage points, respectively, for federal tax credits, reduced by 3.5 and 3.1 percentage points, respectively, for non-U.S. rate differences net of withholding tax, and reduced by 2.8 and 1.6 percentage points, respectively, for share-based compensation. For the nine months ended September 30, 2021, the effective tax rate was increased by 8.0 percentage points for the U.K.’s enacted tax rate change.

The company’s effective tax rate was 23.9 percent and 20 percent for the three and nine months ended September 30, 2020, respectively. As compared to the statutory U.S. tax rate, the effective tax rate for the three and nine months ended March 31, 2021, was reduced by 5 percentage points for foreign tax rate differences including tax holidays, 2.6 percentage points for share-based compensation, and 2.4 percentage points for federal tax credits. Also, as compared to the statutory U.S. tax rate, the effective tax rate for the three months ended March 31,September 30, 2020, was reduced by 515.8 and 7.0 percentage points, respectively, for federal tax credits, reduced by 2.0 and 7.1 percentage points, respectively, for the benefit of share-based compensation, ~~reduced~~increased by ~~13.8~~5.7 and 3.8 percentage points, respectively, for enacted tax rate changes, increased by 2.1 and 1.5 percentage points, respectively, for non-U.S. rate differences and withholding tax, increased by 1.1 and 3.8 percentage points, respectively, for the impact of revaluing certain deferred tax assets due to fluctuations in currency exchange rates and increased by 3.4 percentage points for the ~~benefit of losses in equity in results of affiliates, and increased by 35.3 percentage points~~nine months ended September 30, 2020, for the impact of the beverage packaging, other, segment goodwill impairment.

17. Employee Benefit Obligations


	September 30,		December 31,
($ in millions)	2021		2020

Underfunded defined benefit pension liabilities	$	718	$	955
Less: Current portion		(22)		(24)
Long-term defined benefit pension liabilities		696		931
Long-term retiree medical liabilities		148		156
Deferred compensation plans		417		439
Other		61		87
	$	1,322	$	1,613

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Notes to the Unaudited Condensed Consolidated Financial Statements

~~17. Employee Benefit Obligations~~

March 31,

December 31,
($ in millions)

2021

2020

Underfunded defined benefit pension liabilities

$
809

$
955
Less: Current portion

(23)

(24)
Long-term defined benefit pension liabilities

786

931
Long-term retiree medical liabilities

152

156
Deferred compensation plans

399

439
Other

58

87

$
1,395

$
1,613

Components of net periodic benefit cost associated with the company’s defined benefit pension plans were as follows:


	Three Months Ended March 31,												Three Months Ended September 30,
	2021						2020						2021						2020
($ in millions)	U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total

Ball-sponsored plans:
Service cost	$	21	$	3	$	24	$	16	$	4	$	20	$	20	$	4	$	24	$	16	$	4	$	20
Interest cost		13		9		22		20		14		34		12		9		21		18		14		32
Expected return on plan assets		(31)		(16)		(47)		(31)		(21)		(52)		(29)		(17)		(46)		(29)		(22)		(51)
Amortization of prior service cost		—		1		1		—		1		1		—		1		1		—		1		1
Recognized net actuarial loss		13		1		14		10		1		11		12		1		13		10		1		11
Settlement losses (a)														130		—		130		5		—		5
Total net periodic benefit cost	$	16	$	(2)	$	14	$	15	$	(1)	$	14	$	145	$	(2)	$	143	$	20	$	(2)	$	18

(a)	Includes settlement losses related to the purchase of non-participating annuities and lump-sum payments which were recorded in business consolidation and other activities. See Note 6 for further details.


	Nine Months Ended September 30,
	2021						2020
($ in millions)	U.S.		Non-U.S.		Total		U.S.		Non-U.S.		Total

Ball-sponsored plans:
Service cost	$	62	$	10	$	72	$	48	$	12	$	60
Interest cost		38		27		65		56		43		99
Expected return on plan assets		(91)		(49)		(140)		(91)		(64)		(155)
Amortization of prior service cost		1		2		3		1		2		3
Recognized net actuarial loss		36		4		40		30		4		34
Settlement losses (a)		130		—		130		102		—		102
Total net periodic benefit cost	$	176	$	(6)	$	170	$	146	$	(3)	$	143

(a)	Includes settlement losses related to the purchase of non-participating annuities and lump-sum payments which were recorded in business consolidation and other activities. See Note 6 for further details.

Non-service pension income of ~~$10~~$11 million and $6$7 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and income of $32 million and $19 million for the nine months ended September 30, 2021 and 2020, respectively, is included in selling, general, and administrative (SG&A) ~~expenses.~~expenses in the unaudited condensed consolidated statement of earnings.

Contributions to the company’s defined benefit pension plans were ~~$162~~$203 million for the first ~~three~~nine months of 2021 compared to ~~$11~~$92 million for the first ~~three~~nine months of 2020, and such contributions are expected to be approximately ~~$185~~$215 million for the full year of 2021. This estimate may change based on changes to the U.S. Pension Protection Act, the effects of the Coronavirus Aid, Relief, and Economic Security Act (CARES) and American Rescue Plan Act (ARPA) ~~Acts~~ and the actual returns achieved on plan assets, among other factors.

~~18. Equity~~Ball completed the purchase of non-participating group annuity contracts totaling approximately $325 million and ~~Accumulated Other Comprehensive Earnings~~lump-sum payments for certain of its U.S. pension benefit obligations that were transferred to an insurance company in the third quarter of 2021. The annuity purchase triggered settlement accounting and resulted in the recognition of settlement losses recorded of $130 million in business consolidation and other activities in the unaudited condensed consolidated statement of earnings.

~~The following tables provide additional details of the company’s equity activity:~~

Common Stock

Treasury Stock

Accumulated Other

Number of

Number of

Retained

Comprehensive

Noncontrolling

Total
($ in millions; share amounts in thousands)

Shares

Amount

Shares

Amount

Earnings

Earnings (Loss)

Interest

Equity

Balance at December 31, 2020

679,524

$
1,167

(351,939)

$
(3,130)

$
6,192

$
(954)

$
62

$
3,337
Net earnings (loss)

—

—

—

—

200

—

—

200
Other comprehensive earnings (loss), net of tax

—

—

—

—

—

57

—

57
Common dividends, net of tax benefits

—

—

—

—

(50)

—

—

(50)
Treasury stock purchases

—

—

(121)

(10)

—

—

—

(10)
Treasury shares reissued

—

—

161

8

—

—

—

8
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged

490

4

—

8

—

—

—

12
Balance at March 31, 2021

680,014

$
1,171

(351,899)

$
(3,124)

$
6,342

$
(897)

$
62

$
3,554

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Common Stock

Treasury Stock

Accumulated Other

Number of

Number of

Retained

Comprehensive

Noncontrolling

Total
($ in millions; share amounts in thousands)

Shares

Amount

Shares

Amount

Earnings

Earnings (Loss)

Interest

Equity

Balance at December 31, 2019

676,302

$
1,178

(351,667)

$
(3,122)

$
5,803

$
(910)

$
70

$
3,019
Net earnings

—

—

—

—

23

—

—

23
Other comprehensive earnings (loss), net of tax

—

—

��

—

—

(229)

—

(229)
Common dividends, net of tax benefits

—

—

—

(49)

—

—

(49)
Treasury stock purchases

—

—

(774)

(54)

—

—

—

(54)
Treasury shares reissued

—

—

232

7

—

—

—

7
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged

1,826

(27)

—

—

—

—

—

(27)
Other activity

—

—

—

10

—

—

—

10
Balance at March 31, 2020

678,128

$
1,151

(352,209)

$
(3,159)

$
5,777

$
(1,139)

$
70

$
2,700

18. Equity and Accumulated Other Comprehensive Earnings ~~(Loss)~~

The ~~activity related to accumulated other comprehensive earnings (loss) was as follows:~~

($ in millions)

Foreign
Currency
Translation
(Net of Tax)

Pension and
Other Postretirement
Benefits
(Net of Tax)

Derivatives Designated as Hedges
(Net of Tax)

Accumulated
Other
Comprehensive
Earnings (Loss)

Balance at December 31, 2020

(555)

(466)

67

(954)
Other comprehensive earnings (loss) before reclassifications

(12)

21

66

75
Reclassification of net deferred (gains) losses into earnings

—

11

(29)

(18)
Balance at March 31, 2021

$
(567)

$
(434)

$
104

$
(897)

~~The~~ following ~~table provides~~tables provide additional details of the ~~amounts recognized into net earnings from accumulated other comprehensive earnings (loss):~~company’s equity activity:

Three Months Ended March 31,
($ in millions)

2021

2020

Gains (losses) on cash flow hedges:

Commodity contracts recorded in net sales

$
(16)

$
—
Commodity contracts recorded in cost of sales

10

4
Currency exchange contracts recorded in selling, general and administrative

42

18
Cross-currency swaps recorded in selling, general and administrative

—

(1)
Interest rate contracts recorded in interest expense

—

(1)
Total before tax effect

36

20
Tax benefit (expense) on amounts reclassified into earnings

(7)

(5)
Recognized gain (loss), net of tax

$
29

$
15

Amortization of pension and other postretirement benefits: (a)

Actuarial gains (losses)

$
(14)

$
(11)
Prior service income (expense)

(1)

—
Total before tax effect

(15)

(11)
Tax benefit (expense) on amounts reclassified into earnings

4

3
Recognized gain (loss), net of tax

$
(11)

$
(8)

~~(a)~~

~~These~~ ~~components are included in the computation of net periodic benefit cost detailed~~ ~~in Note 17.~~


	Common Stock			Treasury Stock					Accumulated Other
	Number of			Number of			Retained		Comprehensive		Noncontrolling		Total
($ in millions; share amounts in thousands)	Shares	Amount		Shares	Amount		Earnings		Earnings (Loss)		Interest		Equity

Balance at June 30, 2021	680,246	$	1,195	(353,475)	$	(3,255)	$	6,496	$	(797)	$	62	$	3,701
Net earnings	—		—	—		—		179		—		—		179
Other comprehensive earnings (loss), net of tax	—		—	—		—		—		144		—		144
Common dividends	—		—	—		—		(66)		—		—		(66)
Treasury stock purchases	—		—	(2,429)		(219)		—		—		—		(219)
Treasury shares reissued	—		—	62		9		—		—		—		9
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	421		14	—		—		—		—		—		14
Other activity	—		—	—		2		2		—		(1)		3
Balance at September 30, 2021	680,667	$	1,209	(355,842)	$	(3,463)	$	6,611	$	(653)	$	61	$	3,765


	Common Stock			Treasury Stock					Accumulated Other
	Number of			Number of			Retained		Comprehensive		Noncontrolling		Total
($ in millions; share amounts in thousands)	Shares	Amount		Shares	Amount		Earnings		Earnings (Loss)		Interest		Equity

Balance at June 30, 2020	678,484	$	1,153	(352,102)	$	(3,145)	$	5,822	$	(1,068)	$	68	$	2,830
Net earnings	—		—	—		—		241		—		(1)		240
Other comprehensive earnings (loss), net of tax	—		—	—		—		—		(87)		—		(87)
Common dividends	—		—	—		—		(49)		—		—		(49)
Treasury shares reissued	—		—	80		7		—		—		—		7
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	517		11	—		—		—		—		—		11
Other activity	—		—	—		1		—		—		—		1
Balance at September 30, 2020	679,001	$	1,164	(352,022)	$	(3,137)	$	6,014	$	(1,155)	$	67	$	2,953


	Common Stock			Treasury Stock					Accumulated Other
	Number of			Number of			Retained		Comprehensive		Noncontrolling		Total
($ in millions; share amounts in thousands)	Shares	Amount		Shares	Amount		Earnings		Earnings (Loss)		Interest		Equity

Balance at December 31, 2020	679,524	$	1,167	(351,939)	$	(3,130)	$	6,192	$	(954)	$	62	$	3,337
Net earnings	—		—	—		—		581		—		—		581
Other comprehensive earnings (loss), net of tax	—		—	—		—		—		301		—		301
Common dividends	—		—	—		—		(164)		—		—		(164)
Treasury stock purchases	—		—	(4,201)		(368)		—		—		—		(368)
Treasury shares reissued	—		—	298		25		—		—		—		25
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	1,143		42	—		—		—		—		—		42
Other activity	—		—	—		10		2		—		(1)		11
Balance at September 30, 2021	680,667	$	1,209	(355,842)	$	(3,463)	$	6,611	$	(653)	$	61	$	3,765


	Common Stock			Treasury Stock					Accumulated Other
	Number of			Number of			Retained		Comprehensive		Noncontrolling		Total
($ in millions; share amounts in thousands)	Shares	Amount		Shares	Amount		Earnings		Earnings (Loss)		Interest		Equity

Balance at December 31, 2019	676,302	$	1,178	(351,667)	$	(3,122)	$	5,803	$	(910)	$	70	$	3,019
Net earnings	—		—	—		—		358		—		(3)		355
Other comprehensive earnings (loss), net of tax	—		—	—		—		—		(245)		—		(245)
Common dividends	—		—	—		—		(148)		—		—		(148)
Treasury stock purchases	—		—	(775)		(54)		—		—		—		(54)
Treasury shares reissued	—		—	420		21		—		—		—		21
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	2,699		(14)	—		—		—		—		—		(14)
Other activity	—		—	—		18		1		—		—		19
Balance at September 30, 2020	679,001	$	1,164	(352,022)	$	(3,137)	$	6,014	$	(1,155)	$	67	$	2,953

1517

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Accumulated Other Comprehensive Earnings (Loss)

The activity related to accumulated other comprehensive earnings (loss) was as follows:


($ in millions)	Currency Translation (Net of Tax)		Pension and Other Postretirement Benefits (Net of Tax)		Derivatives Designated as Hedges (Net of Tax)		Accumulated Other Comprehensive Earnings (Loss)

Balance at December 31, 2020		(555)		(466)		67		(954)
Other comprehensive earnings (loss) before reclassifications		19		55		159		233
Reclassification of net deferred (gains) losses into earnings		—		129		(61)		68
Balance at September 30, 2021	$	(536)	$	(282)	$	165	$	(653)

The following table provides additional details of the amounts recognized into net earnings from accumulated other comprehensive earnings (loss):


	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020

Gains (losses) on cash flow hedges:
Commodity contracts recorded in net sales	$	(28)	$	(4)	$	(89)	$	33
Commodity contracts recorded in cost of sales		53		(27)		95		(62)
Currency exchange contracts recorded in selling, general and administrative		27		(30)		66		(23)
Cross-currency swaps recorded in selling, general and administrative		—		—		—		(1)
Interest rate contracts recorded in interest expense		—		(2)		—		(5)
Total before tax effect		52		(63)		72		(58)
Tax benefit (expense) on amounts reclassified into earnings		(9)		15		(11)		13
Recognized gain (loss), net of tax	$	43	$	(48)	$	61	$	(45)

Amortization of pension and other postretirement benefits: (a)
Actuarial gains (losses)	$	(12)	$	(10)	$	(39)	$	(30)
Prior service income (expense)		(1)		—		(3)		(1)
Effect of pension settlements		(130)		(5)		(130)		(109)
Total before tax effect		(143)		(15)		(172)		(140)
Tax benefit (expense) on amounts reclassified into earnings		35		3		43		34
Recognized gain (loss), net of tax	$	(108)	$	(12)	$	(129)	$	(106)

(a)	These components are included in the computation of net periodic benefit cost detailed in Note 17.

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

19. Earnings and Dividends Per Share


	Three Months Ended March 31,				Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions, except per share amounts; shares in thousands)	2021		2020		2021		2020		2021		2020

Net earnings attributable to Ball Corporation	$	200	$	23	$	179	$	241	$	581	$	358

Basic weighted average common shares		327,811		325,346		325,876		326,549		327,097		325,965
Effect of dilutive securities		5,862		6,980		5,719		6,105		5,841		6,187
Weighted average shares applicable to diluted earnings per share		333,673		332,326		331,595		332,654		332,938		332,152

Per basic share	$	0.61	$	0.07	$	0.55	$	0.74	$	1.78	$	1.10
Per diluted share	$	0.60	$	0.07	$	0.54	$	0.72	$	1.75	$	1.08

Certain outstanding options are excluded from the diluted earnings per share calculation because they are anti-dilutive (i.e., their assumed conversion into common stock would increase rather than decrease earnings per share). The options excluded totaled 1one million for the three and nine months ended ~~March 31,~~September 30, 2021 and 2020.

The company declared and paid dividends of ~~$0.15~~$0.20 per share and $0.50 per share for the three and nine months ended ~~March 31,~~September 30, 2021, respectively, and ~~2020.~~$0.15 per share and $0.45 per share for the three and nine months ended September 30, 2020, respectively.

20. Financial Instruments and Risk Management

Policies and Procedures

The company employs established risk management policies and procedures, which seek to reduce ~~its~~the company’s commercial risk exposure to fluctuations in commodity prices, interest rates, currency exchange rates and prices of the company’s common stock with regard to common share repurchases and the company’s deferred compensation stock plan. However, there can be no assurance these policies and procedures will be successful. Although the instruments utilized involve varying degrees of credit, market and interest risk, the counterparties to the agreements are expected to perform fully under the terms of the agreements. The company monitors counterparty credit risk, including lenders, on a regular basis, but Ball cannot be certain that all risks will be discerned or that its risk management policies and procedures will always be effective. Additionally, in the event of default under the company’s master derivative agreements, the non-defaulting party has the option to offset any amounts owed with regard to open derivative positions.

Commodity Price Risk - The company manages commodity price risk in connection with market price fluctuations of aluminum through 2 different methods. First, the company enters into container sales contracts that include aluminum-based pricing terms which generally reflect the same price fluctuations under commercial purchase contracts for aluminum sheet. The terms include fixed, floating or pass through aluminum component pricing. Second, the company uses certain derivative instruments, including option and forward contracts, as economic and cash flow hedges of commodity price risk where there are material differences between sales and purchase contracted pricing and volume.

Interest Rate Risk - The company’s objective in managing exposure to interest rate changes is to minimize the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve these objectives, the company may use a variety of interest rate swaps, collars and options to manage its mix of floating and fixed-rate debt.

~~Table of Contents~~

~~Ball Corporation~~

~~Notes to the Unaudited Condensed Consolidated Financial Statements~~

Currency Exchange Rate Risk - The company’s objective in managing exposure to currency fluctuations is to limit the exposure of cash flows and earnings from changes associated with currency exchange rate changes through the use of various derivative contracts. In addition, at times the company manages earnings translation volatility through the use of currency option strategies, and the change in the fair value of those options is recorded in the company’s net earnings.

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The following table provides additional information related to the commercial risk management instruments described above:


($ in millions)	March 31, 2021							September 30, 2021
Commercial risk area	Commodity			Currency		Interest Rate		Commodity			Currency		Interest Rate

Notional amount of contracts	$	1,375	(a)	$	2,724	$	1,171	$	1,692	(a)	$	2,803	$	1,795
Net gain (loss) included in AOCI, after-tax		80	(b)		24		—		138	(b)		27		—
Net gain (loss) included in AOCI, after-tax, expected to be recognized in the unaudited condensed consolidated statement of earnings within the next 12 months		66	(b)		17		—
Net gain (loss) included in AOCI, after-tax, expected to be recognized in net earnings within the next 12 months									130	(b)		19		—

Longest duration of forecasted cash flow hedge transactions in years		3			4		1		3			3		2

(a)	Substantially all aluminum contracts received hedge accounting treatment as of ~~March 31,~~September 30, 2021.

(b)	Substantially all of this gain (loss) will be offset by pricing changes in sales and purchase contracts.

Common Stock Price Risk

The company’s deferred compensation stock program is subject to variable plan accounting and, accordingly, is marked to fair value using the company’s closing stock price at the end of the related reporting period. The company entered into total return swaps to reduce the company’s earnings exposure to these fair value fluctuations that will be outstanding through ~~May 2021~~March 2022 and have a combined notional value of 2.6 million shares. Based on the current number of shares in the program, each $1 change in the company’s stock price would have an insignificant impact on pretax earnings, net of the impact of related derivatives.

Collateral Calls

The company’s agreements with its financial counterparties require the company to post collateral in certain circumstances when the negative mark to fair value of the derivative contracts exceeds specified levels. Additionally, the company has collateral posting arrangements with certain customers on these derivative contracts. The cash flows of the margin calls, if any, are shown within the investing section of the company’s unaudited condensed consolidated statements of cash flows. As of ~~March 31,~~September 30, 2021, and December 31, 2020, the aggregate fair value of all derivative instruments with credit-risk-related contingent features was a net liability position of ~~$15~~$7 million and $52 million, respectively, and 0 collateral was required to be posted.

1720

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

Fair Value Measurements

Ball has classified all applicable financial derivative assets and liabilities as Level 2 within the fair value hierarchy as of ~~March 31,~~September 30, 2021, and December 31, 2020, and presented those values in the tables below. The company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels.


		March 31, 2021							September 30, 2021
($ in millions)	Balance Sheet Location	Derivatives Designated as Hedging Instruments		Derivatives not Designated as Hedging Instruments		Total		Balance Sheet Location	Derivatives Designated as Hedging Instruments		Derivatives not Designated as Hedging Instruments		Total

Assets:
Commodity contracts		$	115	$	—	$	115		$	188	$	—	$	188
Foreign currency contracts			3		11		14
Currency contracts										4		19		23
Other contracts			—		4		4			—		2		2
Total current derivative contracts	Other current assets	$	118	$	15	$	133	Other current assets	$	192	$	21	$	213

Commodity contracts		$	17	$	—	$	17		$	11	$	—	$	11
Foreign currency contracts			26		—		26
Currency contracts										47		—		47
Total noncurrent derivative contracts	Other noncurrent assets	$	43	$	—	$	43	Other noncurrent assets	$	58	$	—	$	58

Liabilities:
Commodity contracts		$	33	$	—	$	33		$	45	$	—	$	45
Foreign currency contracts			2		13		15
Currency contracts										—		5		5
Other contracts			—		4		4			—		9		9
Total current derivative contracts	Other current liabilities	$	35	$	17	$	52	Other current liabilities	$	45	$	14	$	59

Foreign currency contracts		$	—	$	4	$	4
Currency contracts									$	—	$	3	$	3
Total noncurrent derivative contracts	Other noncurrent liabilities	$	—	$	4	$	4	Other noncurrent liabilities	$	—	$	3	$	3

1821

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements


		December 31, 2020							December 31, 2020
		Derivatives Designated as Hedging Instruments		Derivatives not Designated as Hedging Instruments		Total			Derivatives Designated as Hedging Instruments		Derivatives not Designated as Hedging Instruments		Total

Assets:
Commodity contracts		$	50	$	—	$	50		$	50	$	—	$	50
Foreign currency contracts			3		27		30
Currency contracts										3		27		30
Other contracts			—		2		2			—		2		2
Total current derivative contracts	Other current assets	$	53	$	29	$	82	Other current assets	$	53	$	29	$	82

Commodity contracts		$	8	$	—	$	8		$	8	$	—	$	8
Total noncurrent derivative contracts	Other noncurrent assets	$	8	$	—	$	8	Other noncurrent assets	$	8	$	—	$	8

Liabilities:
Commodity contracts		$	17	$	—	$	17		$	17	$	—	$	17
Foreign currency contracts			—		63		63
Currency contracts										—		63		63
Other contracts			—		4		4			—		4		4
Total current derivative contracts	Other current liabilities	$	17	$	67	$	84	Other current liabilities	$	17	$	67	$	84

Foreign currency contracts		$	8	$	2	$	10
Currency contracts									$	8	$	2	$	10
Total noncurrent derivative contracts	Other noncurrent liabilities	$	8	$	2	$	10	Other noncurrent liabilities	$	8	$	2	$	10

The company uses closing spot and forward market prices as published by the London Metal Exchange, the Chicago Mercantile Exchange, Reuters and Bloomberg to determine the fair value of any outstanding aluminum, currency, energy, inflation and interest rate spot and forward contracts. Option contracts are valued using a Black-Scholes model with observable market inputs for aluminum, currency and interest rates. The company values each of its financial instruments either internally using a single valuation technique, from a reliable observable market source, or from the use of third-party software. The company does not adjust the value of its financial instruments except in determining the fair value of a trade that settles in the future. The present value discounting factor is based on the comparable time period LIBOR rate or 12-month LIBOR. Ball performs validations of the company’s internally derived fair values reported for the company’s financial instruments on a quarterly basis utilizing counterparty valuation statements. The company additionally evaluates counterparty creditworthiness and, as of ~~March 31,~~September 30, 2021, has not identified any circumstances requiring the reported values of the company’s financial instruments be adjusted.

1922

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The following table provides the effects of derivative instruments in the consolidated statement of earnings and on accumulated other comprehensive earnings (loss):


		Three Months Ended March 31,									Three Months Ended September 30,
		2021				2020					2021				2020
($ in millions)	Location of Gain (Loss) Recognized in Earnings on Derivatives	Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments		Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments		Location of Gain (Loss) Recognized in Earnings on Derivatives	Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments		Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments

Commodity contracts - manage exposure to customer pricing	Net sales	$	(16)	$	—	$	—	$	1	Net sales	$	(28)	$	—	$	(4)	$	—
Commodity contracts - manage exposure to supplier pricing	Cost of sales		10		3		4		(1)	Cost of sales		53		3		(27)		(7)
Interest rate contracts - manage exposure for outstanding debt	Interest expense		—		—		(1)		1	Interest expense		—		—		(2)		—
Foreign currency contracts - manage currency exposure	Selling, general and administrative		42		35		18		22
Cross-currency swaps - manage intercompany currency exposure	Selling, general and administrative		—		—		(1)		—
Currency contracts - manage currency exposure										Selling, general and administrative		27		12		(30)		(51)
Equity contracts	Selling, general and administrative		—		(25)		—		(2)	Selling, general and administrative		—		23		—		37
Total		$	36	$	13	$	20	$	21		$	52	$	38	$	(63)	$	(21)

~~The changes in accumulated other comprehensive earnings (loss) for derivatives designated as hedges were as follows:~~

Three Months Ended March 31,
($ in millions)

2021

2020

Amounts reclassified into earnings:

Commodity contracts

$
6

$
(4)
Cross-currency swap contracts

—

1
Interest rate contracts

—

1
Currency exchange contracts

(42)

(18)
Change in fair value of cash flow hedges:

Commodity contracts

51

(30)
Interest rate contracts

—

(2)
Cross-currency swap contracts

—

1
Currency exchange contracts

31

58
Foreign currency and tax impacts

(9)

(2)

$
37

$
5


		Nine Months Ended September 30,
		2021				2020
($ in millions)	Location of Gain (Loss) Recognized in Earnings on Derivatives	Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments		Cash Flow Hedge - Reclassified Amount from Accumulated Other Comprehensive Earnings (Loss)		Gain (Loss) on Derivatives not Designated as Hedge Instruments

Commodity contracts - manage exposure to customer pricing	Net sales	$	(89)	$	—	$	33	$	1
Commodity contracts - manage exposure to supplier pricing	Cost of sales		95		9		(62)		2
Interest rate contracts - manage exposure for outstanding debt	Interest expense		—		—		(5)		—
Currency contracts - manage currency exposure	Selling, general and administrative		66		32		(23)		(11)
Cross-currency swaps - manage intercompany currency exposure	Selling, general and administrative		—		—		(1)		—
Equity contracts	Selling, general and administrative		—		(11)		—		47
Total		$	72	$	30	$	(58)	$	39

2023

Table of Contents

Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The changes in accumulated other comprehensive earnings (loss) for derivatives designated as hedges were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020

Amounts reclassified into earnings:
Commodity contracts	$	(25)	$	31	$	(6)	$	29
Cross-currency swap contracts		—		—		—		1
Interest rate contracts		—		2		—		5
Currency exchange contracts		(27)		30		(66)		23
Change in fair value of cash flow hedges:
Commodity contracts		44		21		137		(8)
Interest rate contracts		(1)		1		(1)		(3)
Cross-currency swap contracts		—		(1)		—		—
Currency exchange contracts		26		(39)		58		16
Currency and tax impacts		(1)		(9)		(24)		(12)
	$	16	$	36	$	98	$	51

21. Contingencies

Ball is subject to numerous lawsuits, claims or proceedings arising out of the ordinary course of business, including actions related to product liability; personal injury; the use and performance of company products; warranty matters; patent, trademark or other intellectual property infringement; contractual liability; the conduct of the company’s business; tax reporting in domestic and ~~foreign~~non-U.S. jurisdictions; workplace safety and environmental and other matters. The company has also been identified as a potentially responsible party (PRP) at several waste disposal sites under U.S. federal and related state environmental statutes and regulations and may have joint and several liability for any investigation and remediation costs incurred with respect to such sites. In addition, the company has received claims alleging that employees in certain plants have suffered damages due to exposure to alleged workplace hazards. Some of these lawsuits, claims and proceedings involve substantial amounts, including as described below, and some of the environmental proceedings involve potential monetary costs or sanctions that may be material. Ball has denied liability with respect to many of these lawsuits, claims and proceedings and is vigorously defending such lawsuits, claims and proceedings. The company carries various forms of commercial, property and casualty, and other forms of insurance; however, such insurance may not be applicable or adequate to cover the costs associated with a judgment against Ball with respect to these lawsuits, claims and proceedings. The company estimates that potential liabilities for all currently known and estimable environmental matters are approximately ~~$28~~$26 million in the aggregate, and such amounts have been included in other current liabilities and other noncurrent liabilities at ~~March 31,~~September 30, 2021.

In November 2012, the USEPA wrote to the company asserting that it is one of at least 50 PRPs with respect to the Lower Duwamish site located in Seattle, Washington, based on the company’s ownership of a glass container plant prior to 1995, and notifying the company of a proposed remediation action plan. A site was selected to begin data review on over 30 industrial companies and government entities and at least 2 PRP groups have been discussing various allocation proposals. The USEPA issued the site Record of Decision (ROD) in December 2014. Ball submitted its initial responses to the allocator’s questionnaire in March 2015, and after reviewing submissions from the PRPs alleging deficiencies in certain of Ball’s responses, the allocator denied certain of the allegations and directed the company to answer others, to which Ball responded during the fourth quarter of 2016. A group of de minimis PRPs, including Ball, retained a technical consultant to assist with their positions vis-à-vis larger PRPs, and further presentations were made to the site allocator during the fourth quarter of 2017 and the first quarter of 2018. Total site remediation costs of $342 million, to cover remediation of approximately 200 acres of river bottom, are expected according to the proposed remediation action plan, which does not include $100 million that has already been spent, and which will be allocated among the numerous PRPs in due course. Based on the information available at this time, the company does not believe that this matter will have a material adverse effect upon its liquidity, results of operations or financial condition.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

In February 2012, Ball Metal Beverage Container Corp. (BMBCC) filed an action against Crown Packaging Technology, Inc. (Crown) in the U.S. District Court for the Southern District of Ohio (the Court) seeking a declaratory judgment that the manufacture, sale and use of certain ends by BMBCC and its customers do not infringe certain claims of Crown’s U.S. patents. Crown subsequently filed a counterclaim alleging infringement of certain claims in these patents seeking unspecified monetary damages, fees and declaratory and injunctive relief. The District Court issued a claim construction order at the end of December 2015 and held a scheduling conference on February 10, 2016, to determine the timeline for future steps in the litigation. The case was stayed by mutual agreement of the parties into the third quarter of 2016, during which Crown made preparations for its discovery with respect to certain ends previously produced by Rexam’s U.S. subsidiary, Rexam Beverage Can Company (RBCC). Such discovery began during the first half of 2017 and concluded in the fourth quarter of 2018. The parties attempted to mediate the case on August 1, 2017, but no progress was made, and the case continued as scheduled. In December, 2018, BMBCC and RBCC filed a motion for summary judgment that the Crown patents at issue are invalid and that the applicable ends supplied by BMBCC and RBCC did not infringe the patents. Crown did not file a motion for summary judgment. On June 21, 2019, the District Court issued an order sustaining the BMBCC/RBCC motion as to invalidity, declining to rule on the other grounds as moot, and indicating that an expanded opinion and an appealable order would be forthcoming. The expanded opinion was docketed on July 22, 2019. The final, appealable order was issued by the Court on September 25, 2019, and the expanded opinion was unsealed. On October 22, 2019, Crown filed a Notice of Appeal of the decision of the Court to the Court of Appeals for the Federal Circuit. On December 31, 2020, the Court of Appeals vacated the decision of the District Court and remanded the case for further proceedings. The District Court held a telephonic hearing with counsel for the parties in March 2021 to discuss the scope of the proceedings on remand and initial position statement regarding remand which was submitted by each party. The District Court also directed each party to submit a document in response to the initial position statement of the other party in April 2021. The parties submitted their position statements to the District Court on April 21, 2021, and are currently waiting on the District Court to advise regarding further proceedings. Based on the information available at the present time, the company does not believe that this matter will have a material adverse effect upon its liquidity, results of operations or financial condition.

A former Rexam Personal Care site in Annecy, France, was found in 2003 to be contaminated following a leak of chlorinated solvents (TCE) from an underground feedline. The site underwent extensive investigation and an active remediation treatment system was put in place in 2006. The business operating from the site was sold to Albea in 2013 and in turn to a French company CATIDOM (operating as Reboul). Reboul vacated the site in September 2014, and the site reverted back to Rexam during the first quarter of 2015. As part of the site closure regulatory requirements, a new regulatory permit (Prefectoral Order) was issued in June 2016, which includes requirements to undertake a cost-benefit analysis and pilot studies of further treatment for the known residual solvent contamination following the shutdown of the current on-site treatment system. A new management plan was proposed to the French Environmental Authorities (DREAL) during 2018 and is the subject of ongoing discussions ahead of a final plan for the site being addressed. Based on the information available at this time, the company does not believe that this matter will have a material adverse effect upon its liquidity, results of operations or financial condition.

The company’s operations in Brazil are involved in various governmental assessments, which have historically mainly related to claims for taxes on the internal transfer of inventory, gross revenue taxes, and indirect tax incentives and deductibility of goodwill. In addition, 1 of the company’s Brazilian subsidiaries received an income tax assessment focused on the disallowance of deductions associated with the acquisition price paid to a third party for a portion of its operations. The company does not believe that the ultimate resolution of these matters will materially impact its results of operations, financial position or cash flows. Under customary local regulations, the company’s Brazilian subsidiaries may need to post cash or other collateral if the process to challenge any administrative assessment proceeds to the Brazilian court system; however, the level of any potential cash or collateral required would not significantly impact the liquidity of those subsidiaries or Ball Corporation.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

During the first quarter of 2017, the Brazilian Supreme Court (the Court) ruled against the Brazilian tax authorities in a leading case related to the computation of certain indirect taxes. The Court ruled that the indirect tax base should not include a value-added tax known as “ICMS.” By removing the ICMS from the tax base, the Court effectively eliminated a “tax on tax.” The Court decision, in principle, affects all applicable judicial proceedings in progress. However, after publication of the decision in October 2017, the Brazilian tax authorities filed an appeal seeking clarification of certain matters, including the amount of ICMS to which taxpayers would be entitled in order to reduce their indirect tax base (i.e., the gross rate or net rate). ~~The appeal also requested a modulation of the decision’s effects, which may limit its impact on taxpayers.~~

The company’s Brazilian subsidiaries paid to the Brazilian tax authorities the gross amounts of certain indirect taxes (which included ICMS in their tax base) and filed lawsuits in 2014 and 2015 to challenge the legality of these tax on tax amounts. Pursuant to these lawsuits, the company requested reimbursement of prior excess tax payments and entitlement to retain amounts not remitted. During the third quarter of 2018, the company learned of a further decision of the Court indicating that lawsuits filed prior to the trial resulting in its 2017 decision, such as those filed by the company, would likely be upheld. The company also noted that other Brazilian companies, including customers of its Brazilian subsidiaries, which had timely filed equivalent lawsuits, were recording income based on the applicable ICMS amounts retained. During 2020 and 2019, the company received additional favorable court rulings and completed its analysis of certain prior year overpayments related to ICMS. As these gain contingency amounts were determined to be estimable and realizable, the company recorded $4 million of prior year collections in business consolidation and other activities within its third quarter 2020 unaudited condensed consolidated statement of earnings. ~~The company is currently seeking reimbursement for additional ICMS-related amounts previously paid~~Due to a favorable ruling by the Brazilian ~~government; however, such amounts cannot be estimated at this time. In the event other comparable cases are resolved and the amounts claimed become estimable and realizable,~~Supreme Court in June 2021, the company ~~will record gains, which may~~recorded an additional $22 million of prior year collections in business consolidation and other activities within its second quarter 2021 unaudited condensed consolidated statement of earnings. As of September 30, 2021, the Company has no additional claims outstanding that would result in material ~~reimbursements to the company in future periods.~~reimbursements.

22. Indemnifications and Guarantees

General Guarantees

The company or its appropriate consolidated direct or indirect subsidiaries, have made certain indemnities, commitments and guarantees under which the specified entity may be required to make payments in relation to certain transactions. These indemnities, commitments and guarantees include indemnities to the customers of the subsidiaries in connection with the sales of their packaging and aerospace products and services; guarantees to suppliers of subsidiaries of the company guaranteeing the performance of the respective entity under a purchase agreement, construction contract, renewable energy purchase contract or other commitment; guarantees in respect of certain non-U.S. subsidiaries’ pension plans; indemnities for liabilities associated with the infringement of third-party patents, trademarks or copyrights under various types of agreements; indemnities to various lessors in connection with facility, equipment, furniture and other personal property leases for certain claims arising from such leases; indemnities to governmental agencies in connection with the issuance of a permit or license to the company or a subsidiary; indemnities pursuant to agreements relating to certain joint ventures; indemnities in connection with the sale of businesses or substantially all of the assets and specified liabilities of businesses; and indemnities to directors, officers and employees of the company to the extent permitted under the laws of the State of Indiana and the United States of America. The duration of these indemnities, commitments and guarantees varies and, in certain cases, is indefinite.

In addition, many of these indemnities, commitments and guarantees do not provide for any limitation on the maximum potential future payments the company could be obligated to make. As such, the company is unable to reasonably estimate its potential exposure under these items.

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Ball Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements

The company has not recorded any material liabilities for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets. The company does, however, accrue for payments under promissory notes and other evidences of incurred indebtedness and for losses for any known contingent liability, including those that may arise from indemnifications, commitments and guarantees, when future payment is both reasonably estimable and probable. Finally, the company carries specific and general liability insurance policies and has obtained indemnities, commitments and guarantees from third-party purchasers, sellers and other contracting parties, which the company believes would, in certain circumstances, provide recourse to certain claims arising from these indemnifications, commitments and guarantees.

Debt Guarantees

The company’s and its subsidiaries’ obligations under the senior notes and senior credit facilities (or, in the case of U.S. domiciled non-U.S. subsidiaries under the senior credit facilities, the obligations of non-U.S. credit parties only) are guaranteed on a full, unconditional and joint and several basis by certain of the company’s domestic subsidiaries and the domestic subsidiary borrowers, and obligations of other guarantors and the subsidiary borrowers under the senior credit facilities are guaranteed by the company, in each case with certain exceptions. These guarantees are required in support of the senior notes and senior credit facilities referred to above, are coterminous with the terms of the respective note indentures, senior notes and credit agreement and could be enforced by the holders of the obligations thereunder during the continuation of an event of default under the note indentures, the senior notes and/or the credit agreement. The maximum potential amounts which could be required to be paid under such guarantees are essentially equal to the then outstanding obligations under the respective senior notes or the credit agreement (or, in the case of U.S. domiciled non-U.S. subsidiaries under the senior credit facilities, the obligations of non-U.S. credit parties only), with certain exceptions. All obligations under the guarantees of the senior credit facilities are secured, with certain exceptions, by a valid first priority perfected lien or pledge on (i) 100 percent of the capital stock of each of the company's material wholly owned domestic subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries and (ii) 65 percent of the capital stock of each of the company's material wholly owned first-tier non-U.S. subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries. In addition, the obligations of certain non-U.S. borrowers and non-U.S. pledgors under the loan documents will be secured, with certain exceptions, by a valid first priority perfected lien or pledge on 100 percent of the capital stock of certain of the company's material wholly owned ~~foreign~~non-U.S. subsidiaries and material wholly owned U.S. domiciled non-U.S. subsidiaries directly owned by the company or any of its wholly owned material subsidiaries. The company is not in default under the above senior notes or senior credit facilities.

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements (consolidated financial statements) and accompanying notes included in Item 1 of this Quarterly Report on Form 10-Q, which include additional information about our accounting policies, practices and the transactions underlying our financial results. The preparation of our ~~unaudited condensed~~ consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires us to make estimates and assumptions that affect the reported amounts in our ~~unaudited condensed~~ consolidated financial statements and the accompanying notes including various claims and contingencies related to lawsuits, taxes, environmental and other matters arising during the normal course of business. We apply our best judgment, our knowledge of existing facts and circumstances and actions that we may undertake in the future in determining the estimates that affect our consolidated financial statements. We evaluate our estimates on an ongoing basis using our historical experience, as well as other factors we believe appropriate under the circumstances, such as current economic conditions, and adjust or revise our estimates as circumstances change. As future events and their effects cannot be determined with precision, actual results may differ from these estimates. Ball Corporation and its subsidiaries are referred to collectively as “Ball Corporation,” “Ball,” “the company,” “we” or “our” in the following discussion and analysis.

OVERVIEW

Business Overview and Industry Trends

Ball Corporation is one of the world’s leading aluminum packaging suppliers. Our packaging products are produced for a variety of end uses, are manufactured in facilities around the world and are competitive with other substrates, such as plastics and glass. In the aluminum packaging industry, sales and earnings can be increased by reducing costs, increasing prices, developing new products, expanding volumes and making strategic acquisitions. We also provide aerospace and other technologies and services to governmental and commercial customers, including national defense hardware, antenna and video tactical solutions, civil and operational space hardware and system engineering services.

We sell our aluminum packaging products mainly to large, multinational beverage, personal care and household products companies with which we have developed long-term relationships. This is evidenced by our high customer retention and our large number of long-term supply contracts. While we have a diversified customer base, we sell a significant portion of our packaging products to major companies and brands, as well as to numerous regional customers. The overall global aluminum beverage and aerosol container industries are growing and are expected to continue to grow in the medium to long term. The primary customers for the products and services provided by our aerospace segment are U.S. government agencies or their prime contractors.

We purchase our raw materials from relatively few suppliers. We also have exposure to inflation, in particular the rising costs of raw materials, as well as other direct cost inputs. We mitigate our exposure to the changes in the costs of aluminum through the inclusion of provisions in contracts covering the majority of our volumes to pass through aluminum price changes, as well as through the use of derivative instruments. The pass-through provisions generally result in proportional increases or decreases in sales and costs with a greatly reduced impact, if any, on net earnings. Because of our customer and supplier concentration, our business, financial condition and results of operations could be adversely affected by the loss, insolvency or bankruptcy of a major customer or supplier or a change in a supply agreement with a major customer or supplier, although our contract provisions generally mitigate the risk of customer loss, and our long-term relationships represent a known, stable customer base.

The majority of the aerospace business involves work under contracts, generally from one to five years in duration, as a prime contractor or subcontractor for various U.S. government agencies. Intense competition and long operating cycles are key characteristics of the company’s aerospace and defense industry where it is common for work on major programs to be shared among a number of companies. A company competing to be a prime contractor may, upon ultimate award of the contract to a competitor, become a subcontractor for the ultimate prime contracting company.

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Corporate Strategy

Our Drive for 10 vision encompasses five strategic levers that are key to growing our business and achieving long-term success. Since launching Drive for 10 in 2011, we have made progress on each of the levers as follows:

●

Maximizing value in our existing businesses by expanding container production across our global plant network to meet current demand and improving efficiencies in our beverage container and end facilities in North America, South America and Europe; leveraging plant floor and integrated planning systems to reduce costs and manage contractual provisions across our diverse customer base; successfully acquiring and integrating a large global aluminum beverage business and regional aluminum aerosol facility while also divesting underperforming steel food and steel aerosol packaging assets in North and South America and four beverage packaging facilities in China; and in the remaining aluminum aerosol business, installing new extruded aluminum aerosol lines in our European, Mexican and Indian facilities while also implementing cost-out and value-in initiatives across all of our businesses;

●

Expanding further into new products and capabilities through commercializing our new lightweight, infinitely recyclable aluminum cup and providing next-generation extruded aluminum aerosol packaging that utilizes proprietary technology to significantly lightweight the can; and successfully introducing new specialty beverage cans and aluminum bottle-shaping technology;

●

Aligning ourselves with the right customers and markets by investing capital to meet continued growth for specialty beverage containers throughout our global network, which represent approximately 45 percent of our global beverage packaging mix; aligning with spiked seltzer and craft brewers, sparkling and still water fillers, wine producers and other new beverage producers who continue to use aluminum beverage containers to grow their business; and in our new aluminum cup business, utilizing online platforms and North American retailers to provide infinitely recyclable aluminum cups directly to consumers;

●

Broadening our geographic reach with our acquisition of Rexam and our new investments in beverage manufacturing facilities in the United States, Brazil, Paraguay, Spain, Mexico, Myanmar and Panama, as well as an extruded aluminum aerosol manufacturing facility in India and successful start-up of a dedicated aluminum cup manufacturing facility in the U.S.; and

●

Leveraging our technological expertise in packaging innovation, including the introduction of our new proprietary, brandable lightweight aluminum cup and providing next-generation aluminum bottle-shaping technologies and the increased production of lightweight ReAl® containers, which utilize technology that increases the strength of aluminum used in the manufacturing process while lightweighting the can by up to 20 percent over a standard aluminum aerosol can, as well as our investment in cyber, data analytics methane monitoring, 5G and LIDAR capabilities to further enhance our aerospace technical expertise across a broader customer portfolio.

These ongoing business developments help us stay close to our customers while expanding and/or sustaining our industry positions and global reach with major beverage, personal care, household products and aerospace customers. In order to successfully execute our strategy and reach our goals, we realize the importance of excelling in the following areas: customer focus, operational excellence, innovation and business development, people and culture focus and sustainability.

RESULTS OF CONSOLIDATED OPERATIONS

Management’s discussion and analysis for our results of operations on a consolidated and segment basis include a quantification of factors that had a material impact. Other factors that did not have a material impact, but that are significant to understand the results, are qualitatively described.

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Novel Coronavirus (COVID-19)

The ongoing novel coronavirus (COVID-19) pandemic had a material effect upon the global business environment during the three and nine months ended ~~March 31,~~September 30, 2021 and the year ended December 31, 2020. Ball provides key products and services to the consumer beverage and household markets and the U.S. aerospace markets and, consequently, the operations of Ball and of its principal customers and suppliers have been designated as essential across our key markets. This designation allowed Ball to operate its manufacturing facilities throughout the ~~three~~nine months ended ~~March 31,~~September 30, 2021 and the year ended December 31, 2020, and it is expected that Ball will continue to operate its facilities without disruption in the foreseeable future. However, ~~countries~~jurisdictions around the globe have issued stay-at-home orders, ~~and~~ mandated operational closures of non-essential businesses and other restrictions, which has impacted certain of our customers by constraining some supply of products to certain consumers. The risks that COVID-19 ~~continues~~and its emerging variants continue to present to Ball’s business have been outlined in Note 1 of these ~~unaudited condensed~~ consolidated financial statements and within Item 1. Risk Factors in the company’s 2020 Annual Report on Form 10-K filed on February 17, 2021.

Consolidated Sales and Earnings


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2021			2020			2021			2020			2021			2020

Net sales	$	3,125		$	2,785		$	3,553		$	3,093		$	10,137		$	8,679
Net earnings attributable to Ball Corporation		200			23			179			241			581			358
Net earnings attributable to Ball Corporation as a % of net sales		6	%		1	%		5	%		8	%		6	%		4	%

Sales in the three months ended ~~March 31,~~September 30, 2021, increased compared to the same ~~period~~periods in 2020 primarily due to increased sales volumes, pass through of higher aluminum prices, improved price/mix in our beverage packaging ~~segments.~~segments and favorable exchange rates in our beverage packaging, EMEA, segment. Sales in the nine months ended September 30, 2021, increased compared to the same periods in 2020 primarily due to increased sales volumes, pass through of higher aluminum prices, improved price/mix in our beverage packaging segments and favorable exchange rates in our beverage packaging, EMEA, segment.

Net earnings for the three months ended ~~March 31,~~September 30, 2021, decreased compared to the same periods in 2020 primarily due to higher business consolidation and other activities, higher personnel, startup, and other costs to support growth investments, and the timing of contractual non-aluminum input cost recovery, partially offset by increased sales volumes in our beverage packaging, North and Central America, and beverage packaging, EMEA, segments, favorable price/mix in our beverage packaging segments, and a lower effective tax rate.

Net earnings for the nine months ended September 30, 2021, increased compared to the same ~~period~~periods in 2020 primarily due to increased sales volumes and favorable price/mix in our beverage packaging segments, lower business consolidation and other ~~costs,~~activities, lower total interest expense, and higher earnings from equity in results of affiliates, partially offset by athe tax effect of higher ~~effective tax rate.~~earnings and higher personnel, startup, and other costs to support growth investments, and the timing of contractual non-aluminum input cost recovery.

Cost of Sales (Excluding Depreciation and Amortization)

Cost of sales, excluding depreciation and amortization, was ~~$2,493~~$2,851 million and ~~$2,215~~$2,430 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $8,104 million and $6,875 million for the nine months ended September 30, 2021 and 2020, respectively. These amounts represented 80 percent of consolidated net sales for the three and nine months ended ~~March 31,~~September 30, 2021, and 79 percent of consolidated net sales for the three and nine months ended September 30, 2020.

Depreciation and Amortization

Depreciation and amortization expense was ~~$168~~$175 million and ~~$169~~$160 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $515 million and $499 million for the nine months ended September 30, 2021 and 2020, respectively. These amounts represented 5 percent of consolidated net sales for the three and nine months ended September 30, 2021, and 5 percent and 6 percent of consolidated net sales for the three and nine months ended ~~March 31, 2021 and~~September 30, 2020, respectively.

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Selling, General and Administrative

Selling, general and administrative (SG&A) expenses were ~~$157~~$148 million and ~~$131~~$121 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $471 million and $363 million for the nine months ended September 30, 2021 and 2020, respectively. These amounts represented 4 percent and 5 percent of consolidated net sales for the three and nine months ended ~~March 31,~~September 30, 2021, respectively, and 4 percent of consolidated net sales for the three and nine months ended September 30, 2020. The increase in SG&A expenses was primarily due to higher personnel and other costs to support growth investments.

Business Consolidation Costs and Other Activities

Business consolidation and other activities were $7charges of $141 million and ~~$115~~$8 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $136 million and $235 million for the nine months ended September 30, 2021 and 2020, respectively. The amounts in 2021 are primarily the result of ~~insignificant activities, whereas the~~a non-cash pension settlement charge of $130 million, partially offset by gains resulting from Brazilian indirect tax rulings of $22 million. The charges in 2020 included a non-cash ~~charges for goodwill~~pension settlement charge of $102 million, a non-cash impairment ~~and other costs~~charge of $62 million related to ~~previously disposed businesses as described in Note 6~~the goodwill of ~~these~~the beverage packaging, other, reporting unit, an adjustment to the selling price of ~~these unaudited condensed consolidated financial statements.~~the company’s former steel food and steel aerosol business and a full write-off of the potential future consideration related to the 2019 sale of the company’s former China beverage packaging business.

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Interest Expense

Total interest expense was ~~$67~~$69 million and ~~$111~~$69 million for the three months ended ~~March 31,~~September 30, 2021 and 2020, respectively, and $202 million and $247 million for the nine months ended September 30, 2021 and 2020, respectively. Interest expense, excluding the effect of debt refinancing and other costs, as a percentage of average borrowings decreased ~~by approximately 30~~10 basis points from ~~3.7~~3.5 percent for the three months ended ~~March 31,~~September 30, 2020, to 3.4 percent for the three months ended ~~March 31,~~September 30, 2021, and decreased 20 basis points from 3.6 percent for the nine months ended September 30, 2020, to 3.4 percent for the nine months ended September 30, 2021, due to the drop in global interest ~~rates~~.rates.

Income Taxes

The effective tax rate for the three and nine months ended ~~March 31,~~September 30, 2021, was ~~13.7~~negative 1.2 percent and 20.6 percent, respectively, compared to ~~negative 9.1~~23.9 percent and 20 percent for the same ~~period~~periods in 2020.

The ~~increase~~decrease of ~~22.8~~25.1 percentage points for the three months ended ~~March 31,~~September 30, 2021, was primarily due to an increase in federal tax credits, non-U.S. rate differences net of withholding tax, and the revaluation of deferred tax balances in the U.K. due to a tax rate change occurring in 2020. Similar impacts may occur in future periods, but given their inherent uncertainty, the company is unable to reasonably estimate their potential future impacts.

The increase of 0.6 percentage points for the nine months ended September 30, 2021 was primarily due to the decreased tax benefits for share-based compensation, and increased tax expense related to the revaluation of deferred tax balances in ~~2021, and decreased~~the U.K. due to tax ~~benefits for losses in equity in results of affiliates recognized in 2021~~rate changes, which were partially offset by ~~the 2020 revaluation~~non-U.S. rate differences net of ~~deferred tax assets~~withholding tax. Similar impacts may occur in ~~Brazil due to fluctuations in foreign currency exchange rates. These items are expected to recur,~~future periods, but given their inherent uncertainty, the company is unable to reasonably estimate their potential future impacts. For 2020, ~~the~~ tax ~~benefits were also partially offset~~expense was increased by a charge for the impairment of non tax-deductible goodwill within the beverage packaging, other, operating segment which ~~will~~is not ~~recur.~~

~~On March 3, 2021, the United Kingdom released its 2021 budget, which includes a proposed increase~~expected to ~~the corporate tax rate from 19 percent to 25 percent effective April 1, 2023. The company is assessing the~~ impact ~~of this proposed rate increase which could result in additional~~ tax expense in ~~the period in which the law is enacted.~~future periods.

RESULTS OF BUSINESS SEGMENTS

Segment Results

Ball’s operations are organized and reviewed by management along its product lines and geographical areas and presented in the four reportable segments discussed below.

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Beverage Packaging, North and Central America


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2021			2020			2021			2020			2021			2020

Net sales	$	1,296		$	1,181		$	1,519		$	1,327		$	4,339		$	3,775

Comparable operating earnings	$	140		$	146			186			209			519			544
Business consolidation and other activities (a)		1			(3)
Amortization of acquired intangibles		(7)			(7)
Total segment earnings	$	134		$	136
Comparable operating earnings as a % of segment net sales		11	%		12	%		12	%		16	%		12	%		14	%

(a)	Further details of these items are included in Note 6 to the ~~unaudited condensed~~ consolidated financial statements within Item 1 of this report.

Segment sales for the three and nine months ended ~~March 31,~~September 30, 2021, were ~~$115~~$192 million and $564 million higher, respectively, compared to the same ~~period~~periods in 2020. The increase for the three and nine months ended ~~March 31,~~September 30, 2021, was primarily due to higher volumes, ~~of approximately $60 million, higher specialty mix,~~the pass through of higher aluminum prices and improved ~~customer contractual terms.~~mix.

Comparable operating earnings for the three and nine months ended ~~March 31,~~September 30, 2021, were $6$23 million and $25 million lower, respectively, compared to the same ~~period~~periods in 2020. The decrease for the three and nine months ended ~~March 31,~~September 30, 2021, was primarily due to the impact of low finished goods inventory throughout the quarter, startup and labor costs associated with three new manufacturing plants and timing of contractual non-aluminum input cost recovery, partially offset by higher specialty volumes and improved customer contractual ~~terms, which are more than offset by startup costs for new manufacturing facilities and lost production from winter storms.~~terms.

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Beverage Packaging, EMEA


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2021			2020			2021			2020			2021			2020

Net sales	$	796		$	669		$	937		$	809		$	2,639		$	2,177

Comparable operating earnings	$	100		$	68			125			117			349			248
Business consolidation and other activities (a)		(2)			(3)
Amortization of acquired intangibles		(17)			(16)
Total segment earnings	$	81		$	49
Comparable operating earnings as a % of segment net sales		13	%		10	%		13	%		14	%		13	%		11	%

(a)	Further details of these items are included in Note 6 to the ~~unaudited condensed~~ consolidated financial statements within Item 1 of this report.

Segment sales for the three and nine months ended ~~March 31,~~September 30, 2021, were ~~$127~~$128 million and $462 million higher, respectively, compared to the same ~~period~~periods in 2020. The increase in sales for the three and nine months ended September 30, 2021, was primarily related to increased sales volumes, ~~of approximately $60 million,~~ favorable currency exchange ~~of approximately $65 million~~effects and the pass through of higher aluminum prices.

Comparable operating earnings for the three and nine months ended ~~March 31,~~September 30, 2021, were ~~$32~~$8 million and $101 million higher, respectively, compared to the same ~~period~~periods in 2020. The increase in comparable operating earnings for the three and nine months ended September 30, 2021, was primarily due to higher sales volumes.

Beverage Packaging, South America


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2021			2020			2021			2020			2021			2020

Net sales	$	487		$	405		$	462		$	432		$	1,401		$	1,166

Comparable operating earnings	$	93		$	63			74			64			245			173
Business consolidation and other activities (a)		(1)			(1)
Amortization of acquired intangibles		(14)			(14)
Total segment earnings	$	78		$	48
Comparable operating earnings as a % of segment net sales		19	%		16	%		16	%		15	%		17	%		15	%

(a)	Further details of these items are included in Note 6 to the ~~unaudited condensed~~ consolidated financial statements within Item 1 of this report.

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Segment sales for the three and nine months ended September 30, 2021, were $30 million and $235 million higher compared to the same periods in 2020. The increase in sales for the three months ended ~~March 31,~~September 30, 2021, ~~were $82 million higher compared~~was primarily related to the ~~same period~~pass through of higher aluminum prices and improved mix, partially offset by decreased sales volumes following unfavorable weather conditions in ~~2020.~~July and August across South America. The increase in sales for the nine months ended September 30, 2021, was primarily ~~related~~due to ~~increased~~higher sales volumes ~~of approximately $75 million~~ and the pass through of higher aluminum prices.

Comparable operating earnings for the three and nine months ended ~~March 31,~~September 30, 2021, were ~~$30~~$10 million and $72 million higher, respectively, compared to the same ~~period~~periods in 2020. The increase in comparable operating earnings for the three months ended September 30, 2021, was primarily due to improved mix, partially offset by lower volumes. The increase in comparable operating earnings for the nine months ended September 30, 2021, was primarily due to increased sales volumes and favorable mix.

Aerospace


	Three Months Ended March 31,						Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	2021			2020			2021			2020			2021			2020

Net sales	$	424		$	432		$	498		$	451		$	1,381		$	1,321
Comparable operating earnings		35			40			46			44		��	115			114
Comparable operating earnings as a % of segment net sales		8	%		9	%		9	%		10	%		8	%		9	%

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Segment sales for the three and nine months ended ~~March 31,~~September 30, 2021, were $8$47 million ~~lower~~and $60 million higher, respectively, compared to the same ~~period~~periods in 2020, and comparable operating earnings for the three and nine months ended ~~March 31,~~September 30, 2021, were $5$2 million ~~lower~~and $1 million higher, respectively, compared to the same ~~period~~periods in 2020. The ~~lower~~higher sales and ~~comparable operating~~ earnings for the three months ended ~~March 31,~~September 30, 2021, were primarily due to the ~~timing of material~~company’s new program wins and ~~subcontract cost volume on the company’s U.S. national defense contracts, as well as certain supply chain matters affecting a national defense contract.~~backlog growth.

The aerospace sales contract mix for the ~~three~~nine months ended ~~March 31,~~September 30, 2021, consisted of 5048 percent cost-type contracts, which are billed at our costs plus an agreed upon and/or earned profit component, and 4749 percent fixed-price contracts. The remaining sales were for time and materials contracts. Contracted backlog was ~~$2.2~~$2.8 billion and $2.4 billion at ~~March 31,~~September 30, 2021, and December 31, 2020, respectively. The backlog at ~~March 31,~~September 30, 2021, consisted of 4540 percent cost-type contracts. Comparisons of backlog are not necessarily indicative of the trend of future operations due to the nature of varying delivery and milestone schedules on contracts, timing variances in program funding and the uncertain timing of future contract awards.

Management Performance Measures

Management internally uses various financial measures to evaluate company performance such as comparable operating earnings (earnings before interest, taxes and business consolidation and other non-comparable costs); comparable net earnings (earnings before business consolidation costs and other non-comparable costs after tax); comparable diluted earnings per share (comparable net earnings divided by diluted weighted average shares outstanding); return on average invested capital (net operating earnings after tax over the relevant performance period divided by average invested capital over the same period); economic value added (EVA®) dollars (net operating earnings after tax less a capital charge on average invested capital employed); earnings before interest and taxes (EBIT); earnings before interest, taxes, depreciation and amortization (EBITDA); and diluted earnings per share. Management also uses free cash flow (generally defined by the company as cash flow from operating activities less capital expenditures) as a measure to evaluate the company’s liquidity. We believe this information is also useful to investors as it provides insight into the earnings and cash flow criteria management uses to make strategic decisions. These financial measures may be adjusted at times for items that affect comparability between periods, including business consolidation costs and gains or losses on acquisitions and dispositions.

Nonfinancial measures used in the packaging businesses include production efficiency and spoilage rates; quality control figures; environmental, health and safety statistics; production and sales volumes; asset utilization rates and measures of sustainability. Additional measures used to evaluate financial performance in the aerospace segment include contract revenue realization, award and incentive fees realized, proposal win rates and backlog (including awarded, contracted and funded backlog).

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The following financial measurements are presented on a non-U.S. GAAP basis and should be considered in connection with the ~~unaudited condensed~~ consolidated financial statements included within Item 1 of this report. Non-U.S. GAAP measures should not be considered in isolation and should not be considered superior to, or a substitute for, financial measures calculated in accordance with U.S. GAAP. A presentation of earnings in accordance with U.S. GAAP is available in Item 1 of this report.

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Based on the above definitions, our calculation of comparable operating earnings is summarized below:


	Three Months Ended March 31,				Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020		2021		2020

Net earnings attributable to Ball Corporation	$	200	$	23	$	179	$	241	$	581	$	358
Net earnings (loss) attributable to noncontrolling interests, net of tax		—		—		—		(1)		—		(3)
Net earnings		200		23		179		240		581		355
Equity in results of affiliates, net of tax		1		25		(8)		(8)		(18)		13
Tax provision (benefit)		32		(4)		(2)		73		146		92
Earnings before taxes, as reported		233		44
Earnings before taxes						169		305		709		460
Total interest expense		67		111		69		69		202		247
Earnings before interest and taxes		300		155		238		374		911		707
Business consolidation and other activities		7		115		141		8		136		235
Amortization of acquired intangibles		38		37		38		37		114		111
Comparable operating earnings	$	345	$	307	$	417	$	419	$	1,161	$	1,053

Our calculation of comparable net earnings isand the related earnings per share are summarized below:


	Three Months Ended March 31,				Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions, except per share amounts)	2021		2020		2021		2020		2021		2020

Net earnings attributable to Ball Corporation	$	200	$	23	$	179	$	241	$	581	$	358
Business consolidation and other activities		7		115		141		8		136		235
Amortization of acquired intangibles		38		37		38		37		114		111
Share of equity method affiliate non-comparable costs, net of tax		6		30		(3)		1		3		31
Debt refinancing and other costs		—		40		1		1		1		41
Non-controlling interest share of non-comparable costs, net of tax		—		1
Noncomparable taxes		(11)		(44)
Noncontrolling interest share of non-comparable costs, net of tax						—		—		—		1
Non-comparable taxes						(43)		9		5		(62)
Comparable net earnings	$	240	$	202	$	313	$	297	$	840	$	715

Diluted earnings per share	$	0.60	$	0.07	$	0.54	$	0.72	$	1.75	$	1.08
Comparable diluted earnings per share	$	0.72	$	0.61	$	0.94	$	0.89	$	2.52	$	2.15

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NEW ACCOUNTING PRONOUNCEMENTS

For information regarding recent accounting pronouncements, see Note 2 to the ~~unaudited condensed~~ consolidated financial statements included within Item 1 of this report on Form 10-Q.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Cash Flows and Capital Expenditures

The following summarizes our cash flows:


	Three Months Ended March 31,				Nine Months Ended September 30,
($ in millions)	2021		2020		2021		2020

Cash flows provided by (used in) operating activities	$	(477)	$	(708)	$	876	$	345
Cash flows provided by (used in) investing activities		(348)		(234)		(1,104)		(751)
Cash flows provided by (used in) financing activities		(54)		25		327		(521)

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Our primary sources of liquidity are cash provided by operating activities and external borrowings. We believe that cash flows from operations and cash provided by short-term, long-term and committed revolver borrowings, when necessary, will be sufficient to meet our ongoing operating requirements, scheduled principal and interest payments on debt, dividend payments, anticipated share repurchases and anticipated capital expenditures. We have no debt maturities until 2022, our senior credit facilities are in place until 2024 and we are focused in the near term on maintaining liquidity and flexibility in the current economic environment.

Cash ~~outflows used in~~flows provided by operating activities were ~~$477~~$876 million in 2021, primarily driven by net earnings ~~after~~before depreciation and amortization of ~~$368~~$1.1 billion, being partially offset by pension contributions of $203 million ~~being more than offset by~~and working capital outflows of ~~$703~~$248 million, ~~and pension contributions of $162 million. In comparison to the same period of 2020, our working capital movements reflect~~which reflected an increase in days sales outstanding from 42 days in 2020 to 4854 days in 2021 and ~~a decrease~~an increase in days payable outstanding from 128 days in 2020 to ~~117~~136 days in 2021.

Cash ~~outflows~~flows used in investing activities were ~~$348~~$1.1 billion in 2021 primarily driven by $1.2 billion of capital expenditures for large growth projects, partially offset by $110 million received in 2021 for the sale of our minority-owned investment in South Korea.

Cash flows provided by financing activities were $327 million in 2021 driven primarily by ~~$363~~the issuance of $850 million of ~~capital expenditures for large growth projects.~~

~~Cash outflows used in financing activities were $54~~3.125% senior notes, partially offset by net share purchases of $325 million ~~in 2021, driven primarily by~~and common stock dividends of ~~$50~~$164 million.

We have entered into several regional committed and uncommitted accounts receivable factoring programs with various financial institutions for certain of our receivables. The programs are accounted for as true sales of the receivables, without recourse to Ball, and had combined limits of approximately $1.7 billion at September 30, 2021, and $1.6 billion at ~~March 31, 2021, and~~ December 31, 2020. A total of ~~$348~~$430 million and $232 million were available for sale under such programs as of ~~March 31,~~September 30, 2021, and December 31, 2020, respectively.

Contributions to the company’s defined benefit pension plans were ~~$162~~$203 million in the first ~~three~~nine months of 2021 compared to ~~$11~~$92 million in the first ~~three~~nine months of 2020, and such contributions are expected to be approximately ~~$185~~$215 million for the full year of 2021. This estimate may change based on changes to the U.S. Pension Protection Act, the effects of the CARES Act and ARPA ~~Acts~~Act and the actual returns achieved on plan assets, among other factors.

~~We expect 2021~~The company has approximately $1.7 billion of capital expenditures for property, plant and equipment ~~will likely exceed $1.5 billion, and approximately $1.4 billion was~~ contractually committed as of ~~March 31,~~September 30, 2021.

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As of ~~March 31,~~September 30, 2021, approximately ~~$438~~$427 million of our cash was held outside of the U.S. In the event we need to utilize any of the cash held outside the U.S. for purposes within the U.S., there are no material legal or other economic restrictions regarding the repatriation of cash from any of the countries outside the U.S. where we have cash. Management believes ~~its~~the company’s U.S. operating cash flows and cash on hand, together with its availability under long-term, revolving credit facilities, uncommitted short-term credit facilities and committed and uncommitted accounts receivable factoring programs, will be sufficient to meet the cash requirements of the U.S. portion of our ongoing operations, scheduled principal and interest payments on U.S. debt, dividend payments, capital expenditures and other U.S. cash requirements. If non-U.S. funds are needed for our U.S. cash requirements and we are unable to provide the funds through intercompany financing arrangements, we would be required to repatriate funds from non-U.S. locations where the company has previously asserted indefinite reinvestment of funds outside the U.S.

Based on its indefinite reinvestment assertion, the company has not provided deferred taxes on earnings in certain non-U.S. subsidiaries because such earnings are intended to be indefinitely reinvested in its international operations. It is not practical to estimate the additional taxes that may become payable if these earnings were remitted to the U.S.

Share Repurchases

The company’s share repurchases, net of issuances, totaled $5$325 million during the ~~three~~nine months ended ~~March 31,~~September 30, 2021, compared to ~~$88~~$69 million of repurchases, net of issuances, during the same period of 2020. The company’s share repurchases are completed using cash on hand, cash provided by operating activities and available borrowings.

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Debt Facilities and Refinancing

Given our cash flow projections and unused credit facilities that are available until March 2024, our liquidity is strong and is expected to meet our ongoing cash and debt service requirements. Total interest-bearing debt of ~~$7.7~~$8.5 billion and $7.8 billion was outstanding at ~~March 31,~~September 30, 2021, and December 31, 2020, respectively.

At ~~March 31,~~September 30, 2021, taking into account our outstanding letters of credit, approximately $1.7 billion was available under existing long-term, multi-currency committed revolving credit facilities, which are available until March 2024. In addition to these facilities, the company had approximately $1 billion of short-term uncommitted credit facilities available as of ~~March 31,~~September 30, 2021, of which ~~$21~~$24 million was outstanding and due on demand.

While ongoing financial and economic conditions in certain areas may raise concerns about credit risk with counterparties to derivative transactions, the company mitigates its exposure by allocating the risk among various counterparties and limiting exposure to any one party. We also monitor the credit ratings of our suppliers, customers, lenders and counterparties on a regular basis.

We were in compliance with all loan agreements at ~~March 31,~~September 30, 2021, and for all prior years presented, and we have met all debt payment obligations. The U.S. note agreements and bank credit agreement contain certain restrictions relating to dividends, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The most restrictive of our debt covenants requires us to maintain a leverage ratio (as defined) of no greater than 5.0 times, which will change to 4.5 times as of December 31, 2022. As of ~~March 31,~~September 30, 2021, the company could borrow up to its limits available under the company’s long-term multi-currency committed revolving facilities and short-term uncommitted credit facilities without violating our existing debt covenants. Additional details regarding our debt are available in Note 15 accompanying the ~~unaudited condensed~~ consolidated financial statements within Item 1 of this report.

CONTINGENCIES, INDEMNIFICATIONS AND GUARANTEES

Details about the company’s contingencies, indemnifications and guarantees are available in ~~Notes~~Note 21 and Note 22 accompanying the ~~unaudited condensed~~ consolidated financial statements included within Item 1 of this report. The company is routinely subject to litigation ~~incident~~incidental to operating its businesses and has been designated by various federal and state environmental agencies as a potentially responsible party, along with numerous other companies, for the clean-up of several hazardous waste sites, including in respect of sites related to alleged activities of certain former Rexam subsidiaries. The company believes the matters identified will not have a material adverse effect upon its liquidity, results of operations or financial condition.

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Guaranteed Securities

The company’s senior notes are guaranteed on a full and unconditional, joint and several ~~basis~~bases by the issuer of the company’s senior notes and the subsidiaries that guarantee the notes (the obligor group). The entities that comprise the obligor group are 100 percent owned by the company. As described in the supplemental indentures governing the company’s existing senior notes, the senior notes are guaranteed by any of the company’s domestic subsidiaries that guarantee any other indebtedness of the company.

The following summarized financial information relates to the obligor group as of ~~March 31,~~September 30, 2021, and December 31, 2020, and for the ~~three~~nine months ended ~~March 31,~~September 30, 2021, and the year ended December 31, 2020. Intercompany transactions, equity investments and other intercompany activity between obligor group subsidiaries have been eliminated from the summarized financial information. Investments in subsidiaries not forming part of the obligor group have also been eliminated.

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	Three Months Ended		Year Ended		Nine Months Ended		Year Ended
($ in millions)	March 31, 2021		December 31, 2020		September 30, 2021		December 31, 2020

Net sales	$	1,783	$	7,115	$	5,885	$	7,115
Gross profit (a)		192		935		673		935
Net earnings (loss)		93		528		266		528
Net earnings (loss) attributable to Ball		93		528
Net earnings (loss) attributable to Ball Corporation						266		528

(a)	Gross profit is shown after depreciation and amortization related to cost of sales of ~~$47~~$148 million for the ~~three~~nine months ended ~~March 31,~~September 30, 2021, and $167 million for the year ended December 31, 2020.


	March 31,		December 31,		September 30,		December 31,
($ in millions)	2021		2020		2021		2020

Current assets	$	1,935	$	2,211	$	3,218	$	2,211
Noncurrent assets		13,979		13,701		14,396		13,701
Current liabilities		4,333		3,704		5,181		3,704
Noncurrent liabilities		10,156		10,854		11,075		10,854

Included in the amounts disclosed in the tables above, at ~~March 31,~~September 30, 2021, and December 31, 2020, the obligor group held receivables due from other subsidiary companies of ~~$404~~$435 million and $221 million, respectively, long-term notes receivable due from other subsidiary companies of $9.1 billion and $9.2 billion, respectively, payables due to other subsidiary companies of $1.8 billion and $1.7 billion, ~~as of both periods,~~respectively, and long-term notes payable due to other subsidiary companies of ~~$1.8~~$1.9 billion and $1.5 billion, respectively.

For the ~~three~~nine months ended ~~March 31, 2020,~~September 30, 2021, and the year ended December 31, 2020, the obligor group recorded the following transactions with other subsidiary companies: sales to them of ~~$185~~$583 million and $804 million, respectively, net credits from them of $8$25 million and $24 million, respectively, and net interest income from them of ~~$83~~$253 million and $393 million, respectively. During the year ended December 31, 2020, the obligor group received dividends from other subsidiary companies of $56 million.

A description of the terms and conditions of the company’s debt guarantees is located in Note 22 of Item 1 of this report.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In the ordinary course of business, the company employs established risk management policies and procedures, which seek to reduce our exposure to fluctuations in commodity prices, interest rates, exchange currencies and prices of the company’s common stock in regard to common share repurchases and the company’s deferred compensation stock plan, although there can be no assurance that these policies and procedures will be successful. The company mitigates its exposure by spreading the risk among various counterparties, thus limiting exposure with any one party. The company also monitors the credit ratings of its suppliers, customers, lenders and counterparties on a regular basis. Further details are available in Item 7A within Ball’s 2020 Annual Report on Form 10-K filed on February 17, 2021, and in Note 20 accompanying the ~~unaudited condensed~~ consolidated financial statements included within Item 1 of this report.

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Item 4. CONTROLS AND PROCEDURES

Our chief executive officer and chief financial officer participated in management’s evaluation of our disclosure controls and procedures, as defined by the Securities and Exchange Commission (SEC), as of the end of the period covered by this report and concluded that our controls and procedures were effective. There were no changes to internal controls during the company’s ~~first~~third quarter of 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

FORWARD-LOOKING STATEMENTS

This report contains "forward-looking" statements concerning future events and financial performance. Words such as "expects," "anticipates," "estimates," "believes," and similar expressions typically identify forward-looking statements, which are generally any statements other than statements of historical fact. Such statements are based on current expectations or views of the future and are subject to risks and uncertainties, which could cause actual results or events to differ materially from those expressed or implied. You should therefore not place undue reliance upon any forward-looking statements and any such statements should be read in conjunction with, and qualified in their entirety by, the cautionary statements referenced below. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Key factors, risks and uncertainties that could cause actual outcomes and results to be different are summarized in filings with the Securities and Exchange Commission, including Exhibit 99 in our Form 10-K, which are available on our website and at www.sec.gov. Additional factors that might affect: a) our packaging segments include product capacity, supply, and demand constraints and fluctuations and changes in consumption patterns; availability/cost of raw materials, equipment, and logistics; competitive packaging, pricing and substitution; changes in climate and weather; footprint adjustments and other manufacturing changes, including the startup of new facilities and lines; failure to achieve synergies, productivity improvements or cost reductions; unfavorable mandatory deposit or packaging laws; customer and supplier consolidation; power and supply chain interruptions; changes in major customer or supplier contracts or loss of a major customer or supplier; political instability and sanctions; currency controls; changes in ~~foreign~~currency exchange or tax rates; and tariffs, trade actions, or other governmental actions, including business restrictions and shelter-in-place orders in any country or jurisdiction affecting goods produced by us or in our supply chain, including imported raw materials; b) our aerospace segment include funding, authorization, availability and returns of government and commercial contracts; and delays, extensions and technical uncertainties affecting segment contracts; c) the Company as a whole include those listed above plus: the extent to which sustainability-related opportunities arise and can be capitalized upon; changes in senior management, succession, and the ability to attract and retain skilled labor; regulatory ~~action~~actions or issues including those related to tax, ESG reporting, competition, environmental, health and workplace safety, including U.S. FDA and other actions or public concerns affecting products filled in our containers, or chemicals or substances used in raw materials or in the manufacturing process; technological developments and innovations; the ability to manage cyber threats; litigation; strikes; disease; pandemic; labor cost changes; rates of return on assets of the Company's defined benefit retirement plans; pension changes; uncertainties surrounding geopolitical events and governmental policies both in the U.S. and in other countries, including policies, orders, and actions related to COVID-19; reduced cash flow; interest rates affecting our debt; and successful or unsuccessful joint ventures, acquisitions and divestitures, and their effects on our operating results and business generally.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There were no events required to be reported under Item 1 for the three months ended ~~March 31,~~September 30, 2021, except as discussed in Note 21 to the ~~unaudited condensed~~ consolidated financial statements included within Part I, Item 1 of this report.

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Item 2. Changes in Securities

The following table summarizes the company’s repurchases of its common stock during the ~~first~~third quarter of 2021.


Purchases of Securities	Purchases of Securities						Purchases of Securities
($ in millions)		Total Number of Shares Purchased (a)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (b)		Total Number of Shares Purchased (a)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (b)

January 1 to January 31, 2021		—	$	—	—	36,547,906
February 1 to February 28, 2021		44,936		89.57	44,936	36,502,970
March 1 to March 31, 2021		76,591		83.35	76,591	36,426,379
July 1 to July 31, 2021								257,897	$	82.24	257,897	34,518,266
August 1 to August 31, 2021								1,392,218		90.41	1,392,218	33,126,048
September 1 to September 30, 2021								779,311		92.71	779,311	32,346,737
Total		121,527		85.65	121,527			2,429,426		90.28	2,429,426

(a)	Includes open market purchases (on a trade-date basis), share repurchase agreements and/or shares retained by the company to settle employee withholding tax liabilities.

(b)	The company has an ongoing repurchase program for which 50 million shares ~~are~~were authorized tofor repurchase by Ball’s Board of Directors.

Item 3. Defaults Upon Senior Securities

There were no events required to be reported under Item 3 for the three months ended ~~March 31,~~September 30, 2021.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

There were no events required to be reported under Item 5 for the three months ended ~~March 31,~~September 30, 2021.

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Item 6. Exhibits

~~10.1~~		~~Ball Corporation Deposit Share Program for United States Participants, amended and restated as of July 27, 2016 (filed herewith).~~
12		Obligor group subsidiaries of Ball Corporation

31.1		Certification pursuant to Rule 13a-14(a) or Rule 15d-14(a) by John A. Hayes, Chairman and Chief Executive Officer of Ball Corporation.

31.2		Certification pursuant to Rule 13a-14(a) or Rule 15d-14(a) by Scott C. Morrison, Executive Vice President and Chief Financial Officer of Ball Corporation.

32.1		Certification pursuant to Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code by John A. Hayes, Chairman and Chief Executive Officer of Ball Corporation.

32.2		Certification pursuant to Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code by Scott C. Morrison, Executive Vice President and Chief Financial Officer of Ball Corporation.

99		Cautionary statement for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended.

101.INS		XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		Inline XBRL Taxonomy Extension Schema Document.

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definitions Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		The cover page of the company’s quarterly report on Form 10-Q for the quarter ended ~~March 31,~~September 30, 2021, formatted in Inline XBRL (contained in Exhibit 101), the: (i) Unaudited Condensed Consolidated Statement of Earnings, (ii) Unaudited Statement of Comprehensive Earnings, (iii) Unaudited Condensed Consolidated Balance Sheet, (iv) Unaudited Condensed Consolidated Statement of Cash Flows and (v) Notes to the Unaudited Condensed Consolidated Financial Statements.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Ball Corporation
(Registrant)


By:	/s/ Scott C. Morrison
	Scott C. Morrison
	Executive Vice President and Chief Financial Officer


Date:	~~May 7,~~November 5, 2021

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($ in millions)	Foreign Currency Translation (Net of Tax)		Pension and Other Postretirement Benefits (Net of Tax)		Derivatives Designated as Hedges (Net of Tax)		Accumulated Other Comprehensive Earnings (Loss)

Balance at December 31, 2020		(555)		(466)		67		(954)
Other comprehensive earnings (loss) before reclassifications		(12)		21		66		75
Reclassification of net deferred (gains) losses into earnings		—		11		(29)		(18)
Balance at March 31, 2021	$	(567)	$	(434)	$	104	$	(897)