Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2023 shares | |
Cover | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Transition Report | false |
Document Period End Date | Mar. 31, 2023 |
Entity File Number | 1-9576 |
Entity Registrant Name | O-I GLASS, INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 22-2781933 |
Entity Address, Address Line One | One Michael Owens Way |
Entity Address, City or Town | Perrysburg |
Entity Address, State or Province | OH |
Entity Address, Postal Zip Code | 43551 |
City Area Code | 567 |
Local Phone Number | 336-5000 |
Title of 12(b) Security | Common Stock, $.01 par value |
Security Exchange Name | NYSE |
Trading Symbol | OI |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 155,274,200 |
Entity Central Index Key | 0000812074 |
Amendment Flag | false |
Document Fiscal Year Focus | 2023 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED RESULTS
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS | ||
Net sales | $ 1,831 | $ 1,692 |
Revenue, Product and Service [Extensible List] | us-gaap:ProductMember | us-gaap:ProductMember |
Cost of goods sold | $ (1,347) | $ (1,388) |
Gross profit | 484 | 304 |
Selling and administrative expense | (147) | (119) |
Research, development and engineering expense | (19) | (23) |
Interest expense, net | (68) | (66) |
Equity earnings | 30 | 23 |
Other income (expense), net | (10) | 51 |
Earnings before income taxes | 270 | 170 |
Provision for income taxes | (60) | (48) |
Net earnings | 210 | 122 |
Net earnings attributable to non-controlling interests | (4) | (34) |
Net earnings attributable to the Company | $ 206 | $ 88 |
Basic earnings per share: | ||
Net earnings attributable to the Company (in dollars per share) | $ 1.33 | $ 0.56 |
Weighted average shares outstanding (thousands) (in shares) | 154,696 | 155,849 |
Diluted earnings per share: | ||
Net earnings attributable to the Company (in dollars per share) | $ 1.29 | $ 0.55 |
Weighted average diluted shares outstanding (thousands) (in shares) | 159,094 | 158,798 |
CONDENSED CONSOLIDATED COMPREHE
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME | ||
Net earnings | $ 210 | $ 122 |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments | 161 | 135 |
Pension and other postretirement benefit adjustments, net of tax | (3) | 18 |
Change in fair value of derivative instruments, net of tax | (21) | 3 |
Other comprehensive income | 137 | 156 |
Total comprehensive income | 347 | 278 |
Comprehensive income attributable to non-controlling interests | (7) | (39) |
Comprehensive income attributable to the Company | $ 340 | $ 239 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Current assets: | |||
Cash and cash equivalents | $ 480 | $ 773 | $ 519 |
Trade receivables, net of allowance of $32 million, $28 million, and $30 million at March 31, 2023, December 31, 2022 and March 31, 2022 | 997 | 760 | 900 |
Inventories | 1,019 | 848 | 837 |
Prepaid expenses and other current assets | 256 | 222 | 234 |
Total current assets | 2,752 | 2,603 | 2,490 |
Property, plant and equipment, net | 3,062 | 2,962 | 2,833 |
Goodwill | 1,867 | 1,813 | 1,863 |
Intangibles, net | 267 | 262 | 283 |
Other assets | 1,477 | 1,421 | 1,408 |
Total assets | 9,425 | 9,061 | 8,877 |
Current liabilities: | |||
Accounts payable | 1,304 | 1,355 | 1,169 |
Short-term loans and long-term debt due within one year | 345 | 345 | 67 |
Other liabilities | 606 | 657 | 514 |
Total current liabilities | 2,255 | 2,357 | 1,750 |
Long-term debt | 4,422 | 4,371 | 4,621 |
Paddock support agreement liability | 625 | ||
Other long-term liabilities | 861 | 805 | 779 |
Share owners' equity | 1,887 | 1,528 | 1,102 |
Total liabilities and share owners' equity | $ 9,425 | $ 9,061 | $ 8,877 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
Trade receivables allowance | $ 32 | $ 28 | $ 30 |
CONDENSED CONSOLIDATED CASH FLO
CONDENSED CONSOLIDATED CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | ||
Cash flows from operating activities: | ||||
Net earnings | $ 210 | $ 122 | ||
Non-cash charges | ||||
Depreciation and amortization | 118 | 116 | ||
Pension expense | 7 | 8 | ||
Gain on sale of divested business | (55) | |||
Cash payments | ||||
Pension contributions | (6) | (6) | ||
Cash paid for restructuring activities | (6) | (4) | ||
Change in components of working capital | (536) | (259) | ||
Other, net (a) | [1] | 20 | 5 | |
Cash provided by operating activities | (193) | (73) | ||
Cash flows from investing activities: | ||||
Cash payments for property, plant and equipment | (95) | (96) | ||
Contributions and advances to joint ventures | (3) | |||
Cash proceeds on disposal of other businesses and misc. assets | 96 | |||
Net cash payments for hedging activity | (2) | |||
Cash provided by (utilized in) investing activities | (98) | (2) | ||
Cash flows from financing activities: | ||||
Changes in borrowings, net | (5) | (112) | ||
Payment of finance fees | (20) | |||
Shares repurchased | (10) | (10) | ||
Net cash payments for hedging activity | (7) | |||
Issuance of common stock and other | (1) | (3) | ||
Cash utilized in financing activities | (16) | (152) | ||
Effect of exchange rate fluctuations on cash | 14 | 21 | ||
Change in cash | (293) | (206) | ||
Cash at beginning of period | 773 | 725 | $ 725 | |
Cash at end of period | $ 480 | $ 519 | $ 773 | |
[1] Other, net includes other non-cash charges plus other changes in non-current assets and liabilities. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2023 | |
Segment Information | |
Segment Information | 1. Segment Information The Company has two reportable segments and two operating segments based on its geographic locations: the Americas and Europe. These segments are aligned with the Company’s internal approach to managing, reporting, and evaluating performance of its global glass operations. Certain assets and activities not directly related to one of the segments or to glass manufacturing are reported with Retained corporate costs and other. These include licensing, equipment manufacturing, global engineering, certain equity investments and the remaining businesses in the Asia Pacific region that do not meet the criteria of an individually reportable segment after the sale of the Company’s Australia and New Zealand businesses in 2020. Retained corporate costs and other also includes certain headquarters administrative and facilities costs and certain incentive compensation and other benefit plan costs that are global in nature and are not allocable to the reportable segments. The Company’s measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings before interest income, interest expense, and provision (benefit) for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations and other adjustments, as well as certain retained corporate costs. The Company’s management, including the chief operating decision maker (defined as our chief executive officer), uses segment operating profit, in combination with net sales and selected cash flow information, to evaluate performance and to allocate resources. Segment operating profit for reportable segments includes an allocation of some corporate expenses based on both a percentage of sales and direct billings based on the costs of specific services provided. Segment operating profit is not a recognized term under accounting principles generally accepted in the United States (“U.S. GAAP”) and, therefore, does not purport to be an alternative to earnings before income taxes. Further, the Company's measure of segment operating profit may not be comparable to similarly titled measures of other companies. Financial information for the three months ended March 31, 2023 and 2022 regarding the Company’s reportable segments is as follows: Three months ended March 31, 2023 2022 Net sales: Americas $ 1,000 $ 940 Europe 799 708 Reportable segment totals 1,799 1,648 Other 32 44 Net sales $ 1,831 $ 1,692 Three months ended March 31, 2023 2022 Earnings before income taxes $ 270 $ 170 Items excluded from segment operating profit: Retained corporate costs and other 60 50 Gain on sale of divested business (55) Interest expense, net 68 66 Segment operating profit $ 398 $ 231 Americas $ 176 $ 129 Europe 222 102 Reportable segment totals $ 398 $ 231 Financial information regarding the Company’s total assets is as follows: March 31, December 31, March 31, 2023 2022 2022 Total assets: Americas $ 5,341 $ 5,109 $ 5,097 Europe 3,639 3,392 3,378 Reportable segment totals 8,980 8,501 8,475 Other 445 560 402 Consolidated totals $ 9,425 $ 9,061 $ 8,877 |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue | |
Revenue | 2. Revenue Revenue is recognized at a point in time when obligations under the terms of the Company’s contracts and related purchase orders with its customers are satisfied. This occurs with the transfer of control of glass containers, which primarily takes place when products are shipped from the Company’s manufacturing or warehousing facilities to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, which includes estimated provisions for rebates, discounts, returns and allowances. Amounts billed to customers related to shipping and handling or other pass-through items are included in net sales in the Condensed Consolidated Results of Operations. Sales, value-added, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company’s payment terms are based on customary business practices and can vary by customer type. The term between invoicing and when payment is due is not significant. Also, the Company elected to account for shipping and handling costs as a fulfillment cost at the time of shipment. For the three-month periods ended March 31, 2023 and March 31, 2022, the Company had no material bad debt expense, and there were no material contract assets, contract liabilities or deferred contract costs recorded on the Condensed Consolidated Balance Sheets. The following tables for the three months ended March 31, 2023 and 2022 disaggregate the Company’s revenue by customer end use: Three months ended March 31, 2023 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 609 $ 604 $ 1,213 Food and other 218 126 344 Non-alcoholic beverages 173 69 242 Reportable segment totals $ 1,000 $ 799 $ 1,799 Other 32 Net sales $ 1,831 Three months ended March 31, 2022 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 575 $ 536 $ 1,111 Food and other 214 110 324 Non-alcoholic beverages 151 62 213 Reportable segment totals $ 940 $ 708 $ 1,648 Other 44 Net sales $ 1,692 |
Credit Losses
Credit Losses | 3 Months Ended |
Mar. 31, 2023 | |
Credit Losses | |
Credit Losses | 3. Credit Losses The Company is exposed to credit losses primarily through its sales of glass containers to customers. The Company’s trade receivables from customers are due within one year or less. The Company assesses each customer’s ability to pay for the glass containers it sells to them by conducting a credit review. The credit review considers the expected billing exposure and timing for payment and the customer’s established credit rating or the Company’s assessment of the customer’s creditworthiness, based on an analysis of their financial statements when a credit rating is not available. The Company also considers contract terms and conditions, country and political risk, and business strategy in its evaluation. A credit limit is established for each customer based on the outcome of this review. The Company may require collateralized asset support or a prepayment to mitigate credit risk. The Company monitors its ongoing credit exposure through the active review of customer balances against contract terms and due dates, including timely account reconciliation, dispute resolution and payment confirmation. The Company may employ collection agencies and legal counsel to pursue the recovery of defaulted receivables. At March 31, 2023 and March 31, 2022, the Company reported $997 million and $900 million of accounts receivable, respectively, net of allowances of $32 million and $30 million, respectively. Changes in the allowance were not material for each of the three months ended March 31, 2023 and March 31, 2022. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2023 | |
Inventories | |
Inventories | 4. Inventories Major classes of inventory at March 31, 2023, December 31, 2022 and March 31, 2022 are as follows: March 31, December 31, March 31, 2023 2022 2022 Finished goods $ 800 $ 667 $ 676 Raw materials 171 137 121 Operating supplies 48 44 40 $ 1,019 $ 848 $ 837 |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments | |
Derivative Instruments | 5. Derivative Instruments The Company has certain derivative assets and liabilities, which consist of natural gas forwards and collars, foreign exchange option and forward contracts, interest rate swaps and cross-currency swaps. The valuation of these instruments is determined primarily using the income approach, including discounted cash flow analysis on the expected cash flows of each derivative. Natural gas prices, foreign exchange rates and interest rates are the significant inputs into the valuation models. The Company also evaluates counterparty risk in determining fair values. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. Estimates of the fair value of foreign currency and commodity derivative instruments are determined using exchange traded prices and rates. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. These inputs are observable in active markets over the terms of the instruments the Company holds, and, accordingly, the Company classifies its derivative assets and liabilities as Level 2 in the hierarchy. Commodity Forward Contracts and Collars Designated as Cash Flow Hedges An unrecognized loss of Cash Flow Hedges of Foreign Exchange Risk An unrecognized gain of $0 million at March 31, 2023, an unrecognized gain of $1 million at December 31, 2022 and an unrecognized gain of $1 million at March 31, 2022, related to these cross-currency swaps, were included in Accumulated OCI, and will be reclassified into earnings within the next 12 months. Fair Value Hedges of Foreign Exchange Risk The Company has fixed and variable interest rate borrowings denominated in currencies other than the functional currency of the borrowing subsidiaries. As a result, the Company is exposed to fluctuations in the currency of the borrowing against the subsidiaries’ functional currency. The Company uses derivatives to manage these exposures and designates these derivatives as fair value hedges of foreign exchange risk. Approximately $19 million, $16 million and $5 million of the components were excluded from the assessment of effectiveness and are included in Accumulated OCI at March 31, 2023, December 31, 2022 and March 31, 2022, respectively. Interest Rate Swaps Designated as Fair Value Hedges The Company enters into interest rate swaps in order to maintain a capital structure containing targeted amounts of fixed and floating-rate debt and manage interest rate risk. The Company’s fixed-to-variable interest rate swaps are accounted for as fair value hedges. The relevant terms of the swap agreements match the corresponding terms of the notes, and therefore, there is no hedge ineffectiveness. The Company recorded the net of the fair market values of the swaps as a long-term liability and short-term asset, along with a corresponding net decrease in the carrying value of the hedged debt. Net Investment Hedges The Company is exposed to fluctuations in foreign exchange rates on investments it holds in non-U.S. subsidiaries and uses cross-currency swaps to partially hedge this exposure. Foreign Exchange Derivative Contracts Not Designated as Hedging Instruments The Company uses short-term forward exchange or option agreements to purchase foreign currencies at set rates in the future. These agreements are used to limit exposure to fluctuations in foreign currency exchange rates for significant planned purchases of fixed assets or commodities that are denominated in currencies other than the subsidiaries’ functional currency. The Company also uses foreign exchange agreements to offset the foreign currency exchange rate risk for receivables and payables, including intercompany receivables, payables, and loans, not denominated in, or indexed to, their functional currencies. Balance Sheet Classification The following table shows the amount and classification (as noted above) of the Company’s derivatives at March 31, 2023, December 31, 2022 and March 31, 2022: Fair Value of Fair Value of Hedge Assets Hedge Liabilities March 31, December 31, March 31, March 31, December 31, March 31, 2023 2022 2022 2023 2022 2022 Derivatives designated as hedging instruments: Commodity forward contracts and collars (a) $ — $ 3 $ — $ 20 $ 9 $ — Interest rate swaps - fair value hedges (b) 39 44 20 Cash flow hedges of foreign exchange risk (c) 2 1 Fair value hedges of foreign exchange risk (d) 5 7 12 78 62 5 Net investment hedges (e) 2 3 2 34 28 15 Total derivatives accounted for as hedges $ 7 $ 13 $ 14 $ 173 $ 143 $ 41 Derivatives not designated as hedges: Foreign exchange derivative contracts (f) 8 5 6 2 2 — Total derivatives $ 15 $ 18 $ 20 $ 175 $ 145 $ 41 Current $ 15 $ 15 $ 14 $ 36 $ 32 $ 2 Noncurrent 3 6 139 113 39 Total derivatives $ 15 $ 18 $ 20 $ 175 $ 145 $ 41 (a) The notional amount of the commodity forward contracts and collars was approximately 49 million and 46 million British Thermal Units (“BTUs”) at March 31, 2023 and December 31, 2022, respectively. The maximum maturity dates are in 2027 at March 31, 2023 and December 31, 2022. (b) The notional amounts of the interest rate swaps designated as fair value hedges were €725 million at March 31, 2023, December 31, 2022 and March 31, 2022. The maximum maturity dates are in 2024 at March 31, 2023, December 31, 2022 and March 31, 2022. (c) The notional amounts of the cash flow hedges of foreign exchange risk were 710 million Mexican pesos at March 31, 2023, 0 Mexican pesos at December 31, 2022 and 764 million Mexican pesos at March 31, 2022. The maximum maturity dates are in 2023 at March 31, 2023 and in 2022 at March 31, 2022. (d) The notional amounts of the fair value hedges of foreign exchange risk were $844 million at March 31, 2023, $844 million at December 31, 2022 and $850 million at March 31, 2022. The maximum maturity dates are in 2030 at March 31, 2023, December 31, 2022 and March 31, 2022. (e) The notional amounts of the net investment hedges were €358 million at March 31, 2023, €358 million at December 31, 2022 and €311 million March 31, 2022. The maximum maturity dates are in 2026 at March 31, 2023, 2027 at December 31, 2022 and 2027 at March 31, 2022. (f) The notional amounts of the foreign exchange derivative contracts were $420 million, $245 million and $446 million at March 31, 2023, December 31, 2022 and March 31, 2022, respectively. The maximum maturity dates are in 2023 at March 31, 2023, in 2022 at December 31, 2022 and in March 31, 2022. Gain (Loss) Recognized in OCI (Effective Portion) Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) (1) Three months ended March 31, Three months ended March 31, Derivatives designated as hedging instruments: 2023 2022 2023 2022 Cash Flow Hedges Commodity forward contracts and collars (a) $ (18) $ $ (4) $ Cash flow hedges of foreign exchange risk (a) (2) 13 1 14 Net Investment Hedges Net Investment Hedges (b) (6) 3 1 1 $ (26) $ 16 $ (2) $ 15 Amount of Gain (Loss) Recognized in Other income (expense), net Three months ended March 31, Derivatives not designated as hedges: 2023 2022 Foreign exchange derivative contracts $ (1) $ 2 (1) Gains and losses reclassified from Accumulated OCI and recognized in income are recorded to (a) cost of goods sold or (b) other income (expense), net. |
Restructuring Accruals
Restructuring Accruals | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring Accruals | |
Restructuring Accruals | 6 . Restructuring Accruals Selected information related to the restructuring accruals for the three months ended March 31, 2023 and 2022 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2023 $ 17 $ — $ 10 $ 27 Net cash paid, principally severance and other exit costs (3) (3) (6) Balance at March 31, 2023 $ 14 $ — $ 7 $ 21 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2022 $ 20 $ — $ 11 $ 31 Net cash paid, principally severance and related benefits (3) (1) (4) Balance at March 31, 2022 $ 17 $ — $ 10 $ 27 W hen a decision is made to take restructuring actions, the Company manages and accounts for them programmatically apart from the ongoing operations of the business. Information related to major programs is presented separately, while minor initiatives are presented on a combined basis. As of March 31, 2023 and 2022, no major restructuring programs were in effect. |
Pension Benefit Plans
Pension Benefit Plans | 3 Months Ended |
Mar. 31, 2023 | |
Pension Benefit Plans | |
Pension Benefit Plans | 7. Pension Benefit Plans The components of the net periodic pension cost for the three months ended March 31, 2023 and 2022 are as follows: U.S. Non-U.S. Three months ended March 31, Three months ended March 31, 2023 2022 2023 2022 Service cost $ 2 $ 3 $ 2 $ 2 Interest cost 11 9 9 6 Expected asset return (14) (15) (7) (11) Amortization of actuarial loss 2 11 2 3 Net periodic pension cost $ 1 $ 8 $ 6 $ — The components of pension expense, other than the service cost component, are included in Other income (expense), net on the Condensed Consolidated Results of Operations. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes. | |
Income Taxes | 8. Income Taxes The Company calculates its interim tax provision using the estimated annual effective tax rate (“EAETR”) methodology in accordance with ASC 740-270. The EAETR is applied to the year-to-date ordinary income, exclusive of discrete items. The tax effects of discrete items are then included to arrive at the total reported interim tax provision. The determination of the EAETR is based upon a number of estimates, including the estimated annual pretax ordinary income or loss in each tax jurisdiction in which the Company operates. The tax effects of discrete items are recognized in the tax provision in the quarter they occur, in accordance with U.S. GAAP. Depending on various factors, such as the item’s significance in relation to total income and the rate of tax applicable in the jurisdiction to which it relates, discrete items in any quarter can materially impact the reported effective tax rate. The Company’s annual effective tax rate may be affected by the mix of earnings in the U.S. and foreign jurisdictions, and factors such as changes in tax laws, tax rates or regulations, changes in business, changing interpretation of existing tax laws or regulations, the finalization of tax audits and reviews, as well as other factors. As such, there can be significant volatility in interim tax provisions. The annual effective tax rate differs from the statutory U.S. Federal tax rate of 21% primarily because of varying non-U.S. tax rates and the impact of the U.S. valuation allowance. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt | |
Debt | 9. Debt The following table summarizes the long-term debt of the Company at March 31, 2023, December 31, 2022, and March 31, 2022: March 31, December 31, March 31, 2023 2022 2022 Secured Credit Agreement: Revolving Credit Facility: Revolving Loans $ — $ — $ 100 Term Loans: Term Loan A 1,426 1,426 946 Senior Notes: 5.875%, due 2023 250 249 547 3.125%, due 2024 (€725 million) 754 731 793 6.375%, due 2025 298 298 297 5.375%, due 2025 299 299 298 2.875%, due 2025 (€500 million) 542 529 553 6.625%, due 2027 607 607 606 4.750%, due 2030 396 396 395 Finance leases 147 132 108 Other 4 4 4 Total long-term debt 4,723 4,671 4,647 Less amounts due within one year 301 300 26 Long-term debt $ 4,422 $ 4,371 $ 4,621 The Company presents debt issuance costs in the Condensed Consolidated Balance Sheet as a deduction of the carrying amount of the related debt liability. On March 25, 2022, certain of the Company’s subsidiaries entered into a Credit Agreement and Syndicated Facility Agreement (the “Original Agreement”), which refinanced in full the previous credit agreement. The Original Agreement provided for up to billion of borrowings pursuant to term loans, revolving credit facilities and a delayed draw term loan facility. (see Note 10 for more information). On July 18, 2022, the Company drew down the On August 30, 2022, certain of the Company’s subsidiaries entered into an Amendment No. 1 to its Credit Agreement and Syndicated Facility Agreement (the “Credit Agreement Amendment”), which amends the Original Agreement (as amended by the Credit Agreement Amendment, the “Credit Agreement”). The Credit Agreement Amendment provides for up to The term loans mature, and the revolving credit facilities terminate, in March 2027. The Company recorded approximately $1 million of additional interest charges for third-party fees and the write-off of unamortized fees related to the Credit Agreement Amendment in the third quarter of 2022. The Company recorded approximately $2 million of additional interest charges for third-party fees incurred in connection with the execution of the Original Agreement and the write-off of unamortized fees related to the previous credit agreement in the first quarter of 2022. At March 31, 2023, the Credit Agreement includes a $300 million revolving credit facility, a $950 million multicurrency revolving credit facility and $1,450 million in term loan A facilities ($1,426 million outstanding balance at March 31, 2023, net of debt issuance costs ). At March 31, 2023, the Company had unused credit of . The Credit Agreement contains various covenants that restrict, among other things and subject to certain exceptions, the ability of the Company to incur certain indebtedness and liens, make certain investments, become liable under contingent obligations in certain defined instances only, make restricted payments, make certain asset sales within guidelines and limits, engage in certain affiliate transactions, participate in sale and leaseback financing arrangements, alter its fundamental business, and amend certain subordinated debt obligations. The Credit Agreement also contains one financial maintenance covenant, a Secured Leverage Ratio (as defined in the Credit Agreement), that requires the Company not to exceed a ratio of 2.50x calculated by dividing consolidated Net Indebtedness that is then secured by Liens on property or assets of the Company and certain of its subsidiaries by Consolidated EBITDA, as each term is defined and as described in the Credit Agreement. The Secured Leverage Ratio could restrict the ability of the Company to undertake additional financing or acquisitions to the extent that such financing or acquisitions would cause the Secured Leverage Ratio to exceed the specified maximum. Failure to comply with these covenants and restrictions could result in an event of default under the Credit Agreement. In such an event, the Company could not request additional borrowings under the revolving facilities, and all amounts outstanding under the Credit Agreement, together with accrued interest, could then be declared immediately due and payable. Upon the occurrence and for the duration of a payment event of default, an additional default interest rate equal to per annum will apply to all overdue obligations under the Credit Agreement. If an event of default occurs under the Credit Agreement and the lenders cause all of the outstanding debt obligations under the Credit Agreement to become due and payable, this would result in a default under the indentures governing the Company’s outstanding debt securities and could lead to an acceleration of obligations related to these debt securities. As of March 31, 2023, the Company was in compliance with all covenants and restrictions in the Credit Agreement. In addition, the Company believes that it will remain in compliance and that its ability to borrow additional funds under the Credit Agreement will not be adversely affected by the covenants and restrictions. The Total Leverage Ratio (as defined in the Credit Agreement) determines pricing under the Credit Agreement. The interest rate on borrowings under the Agreement), plus an applicable margin. The applicable margin is linked to the Total Leverage Ratio. The margins range from for Base Rate loans. In addition, a commitment fee is payable on the unused revolving credit facility commitments ranging from Obligations under the Credit Agreement are secured by substantially all of the assets, excluding real estate and certain other excluded assets, of certain of the Company’s domestic subsidiaries and certain foreign subsidiaries. Such obligations are also secured by a pledge of intercompany debt and equity investments in certain of the Company’s domestic subsidiaries and, in the case of foreign obligations, of stock of certain foreign subsidiaries. All obligations under the Credit Agreement are guaranteed by certain domestic subsidiaries of the Company, and certain foreign obligations under the Credit Agreement are guaranteed by certain foreign subsidiaries of the Company. On February 10, 2022, the Company announced the commencement, by an indirect wholly owned subsidiary of the Company, of a tender offer to purchase for cash up to $250.0 million aggregate purchase price of its outstanding (i) 5.875% Senior Notes due 2023, (ii) 5.375% Senior Notes due 2025, (iii) 6.375% Senior Notes due 2025 and (iv) 6.625% Senior Notes due 2027. On February 28, 2022, the Company repurchased $150.0 million aggregate principal amount of the outstanding 5.875% Senior Notes due 2023 and $88.2 million aggregate principal amount of the outstanding 6.625% Senior Notes due 2027. Following the repurchase, $550.0 million and $611.8 million aggregate principal amounts of the 5.875% Senior Notes due 2023 and 6.625% Senior Notes due 2027, respectively, remained outstanding. The repurchases were funded with cash on hand. The Company recorded approximately $16 million of additional interest charges for note repurchase premiums and the write-off of unamortized finance fees related to the senior note repurchases conducted in the first quarter of 2022. In August 2022, the Company redeemed $300 million aggregate principal amount of its 5.875% Senior Notes due 2023. Following the redemption, $250.0 million aggregate principal amount of the 5.875% Senior Notes due 2023 remained outstanding. The redemption was funded with cash on hand. The Company recorded approximately $7 million of additional interest charges for note repurchase premiums and the write-off of unamortized finance fees related to this redemption. In order to maintain a capital structure containing appropriate amounts of fixed and floating-rate debt, the Company has entered into a series of interest rate swap agreements. These interest rate swap agreements were accounted for as fair value hedges (see Note 5 for more information). The Company assesses its capital raising and refinancing needs on an ongoing basis and may enter into additional credit facilities and seek to issue equity and/or debt securities in the domestic and international capital markets if market conditions are favorable. Also, depending on market conditions, the Company may elect to repurchase portions of its debt securities in the open market. The carrying amounts reported for certain long-term debt obligations subject to frequently redetermined interest rates approximate fair value. Fair values for the Company’s significant fixed rate debt obligations are based on published market quotations, and are classified as Level 1 in the fair value hierarchy. Principal Indicated Market Amount Price Fair Value Senior Notes: 5.875%, due 2023 $ 250 $ 99.99 $ 250 3.125%, due 2024 (€725 million) 790 97.99 774 6.375%, due 2025 300 100.75 302 5.375%, due 2025 300 98.57 296 2.875%, due 2025 (€500 million) 545 97.69 532 6.625%, due 2027 612 99.85 611 4.750% due 2030 400 91.66 367 |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Contingencies | |
Contingencies | 10. Contingencies Asbestos From 1948 to 1958, one of the Company’s former business units commercially produced and sold approximately $40 million of a high-temperature, calcium-silicate based pipe and block insulation material containing asbestos. The Company sold its insulation business unit in April 1958. The Company historically received claims from individuals alleging bodily injury and death as a result of exposure to asbestos from this product. On December 26 and 27, 2019, the Company implemented the Corporate Modernization, whereby O-I Glass became the new parent entity with Owens-Illinois Group, Inc. (“O-I Group”) and Paddock as direct, wholly owned subsidiaries, with Paddock as the successor-by-merger to O-I (the “Corporate Modernization”). The Company’s legacy asbestos-related liabilities remained within Paddock, with the Company’s glass-making operations remaining under O-I Group. As part of the Corporate Modernization transactions, O-I Glass entered into a support agreement with Paddock that required O-I Glass to provide funding to Paddock for all permitted uses, subject to the terms of the support agreement. The key objectives of the Paddock support agreement were to ensure that Paddock retained the ability to fund the costs and expenses of managing the Chapter 11 process, and ultimately settle current and future asbestos-related liabilities through the establishment of a trust as described below and fund certain other liabilities. On January 6, 2020 (the “Petition Date”), Paddock voluntarily filed for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) to equitably and finally resolve all of its current and future asbestos-related liabilities. O-I Glass and O-I Group were not included in the Chapter 11 filing. During the pendency of the Chapter 11 proceeding, the activities of Paddock became subject to review and oversight by the Bankruptcy Court. As a result, the Company no longer had exclusive control over Paddock’s activities. Therefore, Paddock was deconsolidated as of the Petition Date, and its assets and liabilities were derecognized from the Company’s Consolidated Financial Statements on a prospective basis. Simultaneously, the Company recognized a liability related to the Paddock support agreement as required under applicable accounting standards. On April 26, 2021, the Company announced that (i) Paddock, (ii) the Official Committee of Asbestos Personal Injury Claimants (the “ACC”), appointed in the Paddock Chapter 11 case as the representative of current Paddock asbestos claimants, and (iii) the Legal Representative of Future Asbestos Claimants (the “FCR”), appointed in the Paddock Chapter 11 case as the representative of future Paddock asbestos claimants, had reached an agreement in principle, supported by O-I Glass, by accepting a proposal from Paddock’s court-appointed mediators setting forth total consideration to fund a trust created under section 524(g) of the Bankruptcy Code upon the effective date of a plan of reorganization for Paddock (the “Effective Date”). On January 12, 2022, Paddock, O-I Glass, the FCR and the ACC jointly filed the Plan of Reorganization for Paddock Enterprises, LLC Under Chapter 11 of the Bankruptcy Code, dated January 12, 2022 (including any supplements and exhibits thereto, as amended, modified or supplemented from time to time in accordance with the terms thereof, the “Plan”). Amended versions of the Plan were subsequently filed on February 14, 2022, April 1, 2022, and May 24, 2022. The Plan incorporates and implements the agreement in principle described herein. On May 26, 2022, the Bankruptcy Court entered an order confirming the Plan and recommending that the District Court affirm such confirmation. On June 22, 2022, the District Court entered an order affirming the confirmation order previously issued by the Bankruptcy Court. On July 8, 2022, the Effective Date of the Plan occurred. Under the confirmed and effective Plan, the Paddock Trust was created pursuant to the provisions of section 524(g) of the Bankruptcy Code and was funded with Pursuant to the Plan, Paddock issued a promissory note (the “Trust Note”) in the principal amount of As a result of the funding of the Paddock Trust and the cancellation of the pledge of equity interests in reorganized Paddock, on July 20, 2022, the Company regained exclusive control over reorganized Paddock’s activities. Therefore, at that date in the third quarter of 2022, reorganized Paddock was reconsolidated, and its remaining assets totaling $18 million (including $12 million of cash and cash equivalents) and liabilities totaling $30 million were recognized in the Company’s Condensed Consolidated Financial Statements. The funding of the Paddock Trust and certain related expenses resulted in an operating cash outflow of $621 million in the Company’s Consolidated Cash Flows during 2022. Other Matters The Company has recorded aggregate accruals of approximately $25 million (undiscounted) as of March 31, 2023 for estimated future remediation costs and associated penalties at these sites. The majority of these accruals arise from the reconsolidation of Paddock in 2022. Although the Company believes its accruals are adequate to cover its portion of future remediation costs, there can be no assurance that the ultimate payments will not exceed the amount of the Company’s accruals and will not have a material effect on its results of operations, financial position and cash flows. Any possible loss or range of potential loss that may be incurred in excess of the recorded accruals cannot be estimated. Other litigation is pending against the Company, in some cases involving ordinary and routine claims incidental to the business of the Company and in others presenting allegations that are non-routine and involve compensatory, punitive or treble damage claims as well as other types of relief. The Company records a liability for such matters when it is both probable that the liability has been incurred and the amount of the liability can be reasonably estimated. Recorded amounts are reviewed and adjusted to reflect changes in the factors upon which the estimates are based, including additional information, negotiations, settlements and other events. |
Share Owners' Equity
Share Owners' Equity | 3 Months Ended |
Mar. 31, 2023 | |
Share Owners' Equity | |
Share Owners' Equity | 11. Share Owners’ Equity The activity in share owners’ equity for the three months ended March 31, 2023 and 2022 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2023 $ 2 $ 3,079 (688) $ 885 $ (1,861) $ 111 $ 1,528 Issuance of common stock (0.4 million shares) 5 5 Reissuance of common stock (0.2 million shares) 4 4 Shares repurchased (0.5 million shares) (10) (10) Stock compensation (0.5 million shares) 19 19 Net earnings 206 4 210 Other comprehensive income 134 3 137 Other (6) (6) Balance on March 31, 2023 $ 2 $ 3,093 $ (690) $ 1,091 $ (1,727) $ 118 $ 1,887 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2022 $ 2 $ 3,090 $ (701) $ 301 $ (1,972) $ 107 $ 827 Reissuance of common stock (0.2 million shares) (2) 5 3 Shares repurchased (0.8 million shares) (10) (10) Stock compensation (0.4 million shares) 7 7 Net earnings 88 34 122 Other comprehensive income 151 5 156 Other (3) (3) Balance on March 31, 2022 $ 2 $ 3,085 $ (699) $ 389 $ (1,821) $ 146 $ 1,102 During the three months ended March 31, 2023, the Company purchased million. The share purchases were The Company has 250,000,000 shares of common stock authorized with a par value of $.01 per share. Shares outstanding are as follows: Shares Outstanding (in thousands) March 31, December 31, March 31, 2023 2022 2022 Shares of common stock issued (including treasury shares) 186,417 185,568 187,617 Treasury shares 31,143 30,880 31,401 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2023 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | 12. Accumulated Other Comprehensive Loss The activity in accumulated other comprehensive loss for the three months ended March 31, 2023 and 2022 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2023 $ (1,280) $ 4 $ (585) $ (1,861) Change before reclassifications 158 (19) (1) 138 Amounts reclassified from accumulated other comprehensive loss (2) (a) 4 (b) 2 Translation effect (6) (6) Other comprehensive income (loss) attributable to the Company 158 (21) (3) 134 Balance on March 31, 2023 $ (1,122) $ (17) $ (588) $ (1,727) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2022 $ (1,290) $ (21) $ (661) $ (1,972) Change before reclassifications 130 18 (2) 146 Amounts reclassified from accumulated other comprehensive income (loss) (15) (a) 14 (b) (1) Translation effect 6 6 Other comprehensive income (loss) attributable to the Company 130 3 18 151 Balance on March 31, 2022 $ (1,160) $ (18) $ (643) $ (1,821) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. |
Other Income (Expense), Net
Other Income (Expense), Net | 3 Months Ended |
Mar. 31, 2023 | |
Other Income (Expense), Net | |
Other Income (Expense), Net | 13. Other Income (Expense), Net Other income (expense), net for the three months ended March 31, 2023 and 2022 included the following: Three months ended March 31, 2023 2022 Gain on sale of divested business (see Note 16) $ $ 55 Intangible amortization expense (8) (8) Foreign currency exchange gain 1 Royalty income 7 6 Other (10) (2) Other income (expense), net $ (10) $ 51 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share | |
Earnings Per Share | 14. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share for the three months ended March 31, 2023 and 2022: Three months ended March 31, 2023 2022 Numerator: Net earnings attributable to the Company $ 206 $ 88 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 154,696 155,849 Effect of dilutive securities: Stock options and other 4,398 2,949 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 159,094 158,798 Basic earnings per share: Net earnings attributable to the Company $ 1.33 $ 0.56 Diluted earnings per share: Net earnings attributable to the Company $ 1.29 $ 0.55 The diluted earnings per share computation for the three months ended March 31, 2023 and 2022 excludes 222,946 and 1,576,542 weighted average shares of common stock, respectively, due to their antidilutive effect, which includes options to purchase, unvested restricted stock units and performance vested restricted share units. Options to purchase shares were excluded because the exercise prices of the options were greater than the average market price of the shares of common stock. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Cash Flow Information | |
Supplemental Cash Flow Information | 15. Supplemental Cash Flow Information Income taxes paid in cash were as follows: Three months ended March 31, 2023 2022 U.S. $ 3 $ 2 Non-U.S. 38 21 Total income taxes paid in cash $ 41 $ 23 Interest paid, including note repurchase premiums, in cash for the three months ended March 31, 2023 and 2022 was million of note repurchase premiums. The Company uses various factoring programs to sell certain trade receivables to financial institutions as part of managing its cash flows. At March 31, 2023, December 31, 2022 and March 31, 2022, the total amount of trade receivables sold by the Company was These amounts included $176 million, $158 million, and $155 million at March 31, 2023, December 31, 2022, and March 31, 2022, respectively, for trade receivable amounts factored under supply chain financing programs linked to commercial arrangements with key customers. million for both March 31, 2023 and 2022. For the three months ended March 31, 2023 and 2022, the Company recorded expenses related to these factoring programs of approximately In accordance with ASU 2022-04, “Liabilities-Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations,” the Company has agreements with third-party administrators that allows participating vendors to track the Company’s payments, and if voluntarily elected by the vendor, to sell payment obligations from the Company to financial institutions as part of a Supply Chain Financing (“SCF”) Program. The Company's payment terms to the financial institutions, including the timing and amount of payments, are based on the original supplier invoices. When participating vendors elect to sell one or more of the Company’s payment obligations, the Company’s rights and obligations to settle the payables on their contractual due date are not impacted. The Company has no economic or commercial interest in a vendor’s decision to enter into these agreements and the financial institutions do not provide the Company with incentives, such as rebates or profit sharing under the SCF Program. The Company agrees on commercial terms with vendors for the goods and services procured, which are consistent with payment terms observed at other peer companies in the industry, and the terms are not impacted by the SCF Program. Such obligations are classified as accounts payable in its Condensed Consolidated Balance Sheet. The Company does not provide asset pledges, or other forms of guarantees, as security for the committed payment to the financial institutions. As of March 31, 2023, December 31, 2022 and March 31, 2022, the Company had approximately |
Divestitures
Divestitures | 3 Months Ended |
Mar. 31, 2023 | |
Divestitures | |
Divestitures | 16. Divestitures In March 2022, the Company completed the sale of its Cristar TableTop S.A.S. business to Vidros Colombia S.A.S, an affiliate of Nadir Figueiredo S.A., a glass tableware producer based in Brazil. Gross proceeds received were approximately $96 million and the related pretax gain recorded was approximately $55 million (approximately $16 million after tax and non-controlling interest) in the first quarter of 2022. The pretax gain was recorded to Other income (expense), net on the Condensed Consolidated Results of Operations. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Information | |
Net sales for the Company's reportable segments | Three months ended March 31, 2023 2022 Net sales: Americas $ 1,000 $ 940 Europe 799 708 Reportable segment totals 1,799 1,648 Other 32 44 Net sales $ 1,831 $ 1,692 |
Segment operating profit (loss) for the Company's reportable segments | Three months ended March 31, 2023 2022 Earnings before income taxes $ 270 $ 170 Items excluded from segment operating profit: Retained corporate costs and other 60 50 Gain on sale of divested business (55) Interest expense, net 68 66 Segment operating profit $ 398 $ 231 Americas $ 176 $ 129 Europe 222 102 Reportable segment totals $ 398 $ 231 |
Total assets for the Company's reportable segments | March 31, December 31, March 31, 2023 2022 2022 Total assets: Americas $ 5,341 $ 5,109 $ 5,097 Europe 3,639 3,392 3,378 Reportable segment totals 8,980 8,501 8,475 Other 445 560 402 Consolidated totals $ 9,425 $ 9,061 $ 8,877 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventories | |
Major classes of inventory | March 31, December 31, March 31, 2023 2022 2022 Finished goods $ 800 $ 667 $ 676 Raw materials 171 137 121 Operating supplies 48 44 40 $ 1,019 $ 848 $ 837 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments | |
Balance Sheet Classification of derivative instruments | Fair Value of Fair Value of Hedge Assets Hedge Liabilities March 31, December 31, March 31, March 31, December 31, March 31, 2023 2022 2022 2023 2022 2022 Derivatives designated as hedging instruments: Commodity forward contracts and collars (a) $ — $ 3 $ — $ 20 $ 9 $ — Interest rate swaps - fair value hedges (b) 39 44 20 Cash flow hedges of foreign exchange risk (c) 2 1 Fair value hedges of foreign exchange risk (d) 5 7 12 78 62 5 Net investment hedges (e) 2 3 2 34 28 15 Total derivatives accounted for as hedges $ 7 $ 13 $ 14 $ 173 $ 143 $ 41 Derivatives not designated as hedges: Foreign exchange derivative contracts (f) 8 5 6 2 2 — Total derivatives $ 15 $ 18 $ 20 $ 175 $ 145 $ 41 Current $ 15 $ 15 $ 14 $ 36 $ 32 $ 2 Noncurrent 3 6 139 113 39 Total derivatives $ 15 $ 18 $ 20 $ 175 $ 145 $ 41 (a) The notional amount of the commodity forward contracts and collars was approximately 49 million and 46 million British Thermal Units (“BTUs”) at March 31, 2023 and December 31, 2022, respectively. The maximum maturity dates are in 2027 at March 31, 2023 and December 31, 2022. (b) The notional amounts of the interest rate swaps designated as fair value hedges were €725 million at March 31, 2023, December 31, 2022 and March 31, 2022. The maximum maturity dates are in 2024 at March 31, 2023, December 31, 2022 and March 31, 2022. (c) The notional amounts of the cash flow hedges of foreign exchange risk were 710 million Mexican pesos at March 31, 2023, 0 Mexican pesos at December 31, 2022 and 764 million Mexican pesos at March 31, 2022. The maximum maturity dates are in 2023 at March 31, 2023 and in 2022 at March 31, 2022. (d) The notional amounts of the fair value hedges of foreign exchange risk were $844 million at March 31, 2023, $844 million at December 31, 2022 and $850 million at March 31, 2022. The maximum maturity dates are in 2030 at March 31, 2023, December 31, 2022 and March 31, 2022. (e) The notional amounts of the net investment hedges were €358 million at March 31, 2023, €358 million at December 31, 2022 and €311 million March 31, 2022. The maximum maturity dates are in 2026 at March 31, 2023, 2027 at December 31, 2022 and 2027 at March 31, 2022. (f) The notional amounts of the foreign exchange derivative contracts were $420 million, $245 million and $446 million at March 31, 2023, December 31, 2022 and March 31, 2022, respectively. The maximum maturity dates are in 2023 at March 31, 2023, in 2022 at December 31, 2022 and in March 31, 2022. |
Effects of derivative instruments on the results of operations | |
Restructuring Accruals (Tables)
Restructuring Accruals (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring Accruals | |
Selected information related to the restructuring accruals | Selected information related to the restructuring accruals for the three months ended March 31, 2023 and 2022 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2023 $ 17 $ — $ 10 $ 27 Net cash paid, principally severance and other exit costs (3) (3) (6) Balance at March 31, 2023 $ 14 $ — $ 7 $ 21 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2022 $ 20 $ — $ 11 $ 31 Net cash paid, principally severance and related benefits (3) (1) (4) Balance at March 31, 2022 $ 17 $ — $ 10 $ 27 W hen a decision is made to take restructuring actions, the Company manages and accounts for them programmatically apart from the ongoing operations of the business. Information related to major programs is presented separately, while minor initiatives are presented on a combined basis. As of March 31, 2023 and 2022, no major restructuring programs were in effect. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt | |
Long-term Debt | March 31, December 31, March 31, 2023 2022 2022 Secured Credit Agreement: Revolving Credit Facility: Revolving Loans $ — $ — $ 100 Term Loans: Term Loan A 1,426 1,426 946 Senior Notes: 5.875%, due 2023 250 249 547 3.125%, due 2024 (€725 million) 754 731 793 6.375%, due 2025 298 298 297 5.375%, due 2025 299 299 298 2.875%, due 2025 (€500 million) 542 529 553 6.625%, due 2027 607 607 606 4.750%, due 2030 396 396 395 Finance leases 147 132 108 Other 4 4 4 Total long-term debt 4,723 4,671 4,647 Less amounts due within one year 301 300 26 Long-term debt $ 4,422 $ 4,371 $ 4,621 |
Fair values of the Company's significant fixed rate debt obligations | Principal Indicated Market Amount Price Fair Value Senior Notes: 5.875%, due 2023 $ 250 $ 99.99 $ 250 3.125%, due 2024 (€725 million) 790 97.99 774 6.375%, due 2025 300 100.75 302 5.375%, due 2025 300 98.57 296 2.875%, due 2025 (€500 million) 545 97.69 532 6.625%, due 2027 612 99.85 611 4.750% due 2030 400 91.66 367 |
Share Owners' Equity (Tables)
Share Owners' Equity (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share Owners' Equity | |
Activity in share owner's equity | The activity in share owners’ equity for the three months ended March 31, 2023 and 2022 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2023 $ 2 $ 3,079 (688) $ 885 $ (1,861) $ 111 $ 1,528 Issuance of common stock (0.4 million shares) 5 5 Reissuance of common stock (0.2 million shares) 4 4 Shares repurchased (0.5 million shares) (10) (10) Stock compensation (0.5 million shares) 19 19 Net earnings 206 4 210 Other comprehensive income 134 3 137 Other (6) (6) Balance on March 31, 2023 $ 2 $ 3,093 $ (690) $ 1,091 $ (1,727) $ 118 $ 1,887 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2022 $ 2 $ 3,090 $ (701) $ 301 $ (1,972) $ 107 $ 827 Reissuance of common stock (0.2 million shares) (2) 5 3 Shares repurchased (0.8 million shares) (10) (10) Stock compensation (0.4 million shares) 7 7 Net earnings 88 34 122 Other comprehensive income 151 5 156 Other (3) (3) Balance on March 31, 2022 $ 2 $ 3,085 $ (699) $ 389 $ (1,821) $ 146 $ 1,102 |
Schedule of shares outstanding | Shares Outstanding (in thousands) March 31, December 31, March 31, 2023 2022 2022 Shares of common stock issued (including treasury shares) 186,417 185,568 187,617 Treasury shares 31,143 30,880 31,401 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accumulated Other Comprehensive Loss | |
Component of accumulated other comprehensive loss | The activity in accumulated other comprehensive loss for the three months ended March 31, 2023 and 2022 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2023 $ (1,280) $ 4 $ (585) $ (1,861) Change before reclassifications 158 (19) (1) 138 Amounts reclassified from accumulated other comprehensive loss (2) (a) 4 (b) 2 Translation effect (6) (6) Other comprehensive income (loss) attributable to the Company 158 (21) (3) 134 Balance on March 31, 2023 $ (1,122) $ (17) $ (588) $ (1,727) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2022 $ (1,290) $ (21) $ (661) $ (1,972) Change before reclassifications 130 18 (2) 146 Amounts reclassified from accumulated other comprehensive income (loss) (15) (a) 14 (b) (1) Translation effect 6 6 Other comprehensive income (loss) attributable to the Company 130 3 18 151 Balance on March 31, 2022 $ (1,160) $ (18) $ (643) $ (1,821) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Income (Expense), Net | |
Schedule of other income (expense), net | Three months ended March 31, 2023 2022 Gain on sale of divested business (see Note 16) $ $ 55 Intangible amortization expense (8) (8) Foreign currency exchange gain 1 Royalty income 7 6 Other (10) (2) Other income (expense), net $ (10) $ 51 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share | |
Computation of basic and diluted earnings per share | Three months ended March 31, 2023 2022 Numerator: Net earnings attributable to the Company $ 206 $ 88 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 154,696 155,849 Effect of dilutive securities: Stock options and other 4,398 2,949 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 159,094 158,798 Basic earnings per share: Net earnings attributable to the Company $ 1.33 $ 0.56 Diluted earnings per share: Net earnings attributable to the Company $ 1.29 $ 0.55 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Supplemental Cash Flow Information | |
Income taxes paid (received) in cash | Three months ended March 31, 2023 2022 U.S. $ 3 $ 2 Non-U.S. 38 21 Total income taxes paid in cash $ 41 $ 23 |
Segment Information (Details)
Segment Information (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
Segment Information | |
Number of reportable segments | 2 |
Number of operating segments | 2 |
Segment Information - Reportabl
Segment Information - Reportable Segments - Net Sales (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net sales: | ||
Net sales | $ 1,831 | $ 1,692 |
Reportable Segment Totals | ||
Net sales: | ||
Net sales | 1,799 | 1,648 |
Americas | ||
Net sales: | ||
Net sales | 1,000 | 940 |
Europe | ||
Net sales: | ||
Net sales | 799 | 708 |
Other | ||
Net sales: | ||
Net sales | $ 32 | $ 44 |
Segment Information - Reporta_2
Segment Information - Reportable Segments - Segment Operating Profits and Reporting Segment Totals (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment operating profit: | ||
Earnings before income taxes | $ 270 | $ 170 |
Items excluded from segment operating profit: | ||
Retained corporate costs and other | 60 | 50 |
Gain on sale of divested business | (55) | |
Interest expense, net | 68 | 66 |
Segment operating profit | ||
Segment operating profit | 398 | 231 |
Americas | ||
Segment operating profit | ||
Segment operating profit | 176 | 129 |
Europe | ||
Segment operating profit | ||
Segment operating profit | $ 222 | $ 102 |
Segment Information - Total Ass
Segment Information - Total Assets (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Assets | |||
Total assets: | $ 9,425 | $ 9,061 | $ 8,877 |
Reportable Segment Totals | |||
Assets | |||
Total assets: | 8,980 | 8,501 | 8,475 |
Americas | |||
Assets | |||
Total assets: | 5,341 | 5,109 | 5,097 |
Europe | |||
Assets | |||
Total assets: | 3,639 | 3,392 | 3,378 |
Other | |||
Assets | |||
Total assets: | $ 445 | $ 560 | $ 402 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue | ||
Net sales | $ 1,831 | $ 1,692 |
Reportable Segment Totals | ||
Disaggregation of Revenue | ||
Net sales | 1,799 | 1,648 |
Americas | ||
Disaggregation of Revenue | ||
Net sales | 1,000 | 940 |
Europe | ||
Disaggregation of Revenue | ||
Net sales | 799 | 708 |
Other | ||
Disaggregation of Revenue | ||
Net sales | 32 | 44 |
Alcoholic beverages (beer, wine, spirits) | ||
Disaggregation of Revenue | ||
Net sales | 1,213 | 1,111 |
Alcoholic beverages (beer, wine, spirits) | Americas | ||
Disaggregation of Revenue | ||
Net sales | 609 | 575 |
Alcoholic beverages (beer, wine, spirits) | Europe | ||
Disaggregation of Revenue | ||
Net sales | 604 | 536 |
Food and other | ||
Disaggregation of Revenue | ||
Net sales | 344 | 324 |
Food and other | Americas | ||
Disaggregation of Revenue | ||
Net sales | 218 | 214 |
Food and other | Europe | ||
Disaggregation of Revenue | ||
Net sales | 126 | 110 |
Non-alcoholic beverages | ||
Disaggregation of Revenue | ||
Net sales | 242 | 213 |
Non-alcoholic beverages | Americas | ||
Disaggregation of Revenue | ||
Net sales | 173 | 151 |
Non-alcoholic beverages | Europe | ||
Disaggregation of Revenue | ||
Net sales | $ 69 | $ 62 |
Credit Losses (Details)
Credit Losses (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Credit Losses | |||
Accounts receivable, net | $ 997 | $ 760 | $ 900 |
Allowance for doubtful accounts | $ 32 | $ 28 | $ 30 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Inventories | |||
Finished goods | $ 800 | $ 667 | $ 676 |
Raw materials | 171 | 137 | 121 |
Operating supplies | 48 | 44 | 40 |
Inventories | $ 1,019 | $ 848 | $ 837 |
Derivative Instruments - Deriva
Derivative Instruments - Derivatives and Hedges (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Commodity forward contracts and collars | Cash Flow Hedges | |||
Derivatives and Hedges | |||
Unrecognized gain (loss) included in Accumulated OCI | $ (12) | $ (1) | |
Foreign exchange risk | Cash Flow Hedges | |||
Derivatives and Hedges | |||
Unrecognized gain (loss) included in Accumulated OCI | 0 | $ 1 | 1 |
Foreign exchange risk | Fair Value Hedges | |||
Derivatives and Hedges | |||
Amount excluded from assessment of effectiveness and included in Accumulated OCI | $ 19 | $ 5 | $ 16 |
Derivative Instruments - Balanc
Derivative Instruments - Balance Sheet Classification (Details) € in Millions, $ / BTU in Millions, $ in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||
Mar. 31, 2023 USD ($) $ / BTU | Dec. 31, 2022 USD ($) $ / BTU | Mar. 31, 2023 EUR (€) | Mar. 31, 2023 MXN ($) | Dec. 31, 2022 EUR (€) | Dec. 31, 2022 MXN ($) | Mar. 31, 2022 USD ($) | Mar. 31, 2022 EUR (€) | Mar. 31, 2022 MXN ($) | |
Derivatives, Fair Value | |||||||||
Total asset derivatives | $ 15 | $ 18 | $ 20 | ||||||
Total liability derivatives | 175 | 145 | 41 | ||||||
Current derivative asset | 15 | 15 | 14 | ||||||
Current derivative liability | 36 | 32 | 2 | ||||||
Noncurrent derivative asset | 3 | 6 | |||||||
Noncurrent derivative liability | 139 | 113 | 39 | ||||||
Derivatives designated as hedging instruments | |||||||||
Derivatives, Fair Value | |||||||||
Total asset derivatives | 7 | 13 | 14 | ||||||
Total liability derivatives | $ 173 | $ 143 | 41 | ||||||
Derivatives designated as hedging instruments | Commodity forward contracts and collars | |||||||||
Derivatives, Fair Value | |||||||||
British Thermal Units ("BTUs") | $ / BTU | 49 | 46 | |||||||
Total asset derivatives | $ 3 | ||||||||
Total liability derivatives | $ 20 | 9 | |||||||
Derivatives designated as hedging instruments | Foreign exchange risk | |||||||||
Derivatives, Fair Value | |||||||||
Notional amount | 844 | 844 | 850 | ||||||
Total asset derivatives | 5 | 7 | 12 | ||||||
Total liability derivatives | 78 | 62 | 5 | ||||||
Derivatives designated as hedging instruments | Interest rate swaps - fair value hedges | |||||||||
Derivatives, Fair Value | |||||||||
Notional amount | € | € 725 | € 725 | € 725 | ||||||
Total liability derivatives | 39 | 44 | 20 | ||||||
Derivatives designated as hedging instruments | Cash flow hedges of foreign exchange risk | |||||||||
Derivatives, Fair Value | |||||||||
Notional amount | $ 710 | $ 0 | $ 764 | ||||||
Total liability derivatives | 2 | 1 | |||||||
Derivatives designated as hedging instruments | Net investment hedges | |||||||||
Derivatives, Fair Value | |||||||||
Notional amount | € | € 358 | € 358 | € 311 | ||||||
Total asset derivatives | 2 | 3 | 2 | ||||||
Total liability derivatives | 34 | 28 | 15 | ||||||
Derivatives not designated as hedging instruments | Foreign exchange contracts | |||||||||
Derivatives, Fair Value | |||||||||
Notional amount | 420 | 245 | 446 | ||||||
Total asset derivatives | 8 | 5 | $ 6 | ||||||
Total liability derivatives | $ 2 | $ 2 |
Derivative Instruments - Effect
Derivative Instruments - Effects of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Derivatives not designated as hedging instruments | Foreign exchange contracts | ||
Derivatives and Hedges | ||
Amount of Gain (Loss) Recognized in Other income (expense), net | $ (1) | $ 2 |
Derivatives designated as hedging instruments | ||
Derivatives and Hedges | ||
Gain (Loss) Recognized in OCI (Effective Portion) | (26) | 16 |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (2) | 15 |
Derivatives designated as hedging instruments | Net Investment Hedges | Other income (expense), net | ||
Derivatives and Hedges | ||
Gain (Loss) Recognized in OCI (Effective Portion) | (6) | 3 |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 1 | 1 |
Derivatives designated as hedging instruments | Commodity forward contracts and collars | Cash Flow Hedges | Cost of goods sold | ||
Derivatives and Hedges | ||
Gain (Loss) Recognized in OCI (Effective Portion) | (18) | |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (4) | |
Derivatives designated as hedging instruments | Foreign exchange risk | Cash Flow Hedges | Cost of goods sold | ||
Derivatives and Hedges | ||
Gain (Loss) Recognized in OCI (Effective Portion) | (2) | 13 |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | $ 1 | $ 14 |
Restructuring Accruals (Details
Restructuring Accruals (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Restructuring accrual | ||
Beginning balance, restructuring reserve | $ 27 | $ 31 |
Net cash paid, principally severance, related benefits and other exit costs | (6) | (4) |
Ending balance, restructuring reserve | 21 | 27 |
Employee Costs | ||
Restructuring accrual | ||
Beginning balance, restructuring reserve | 17 | 20 |
Net cash paid, principally severance, related benefits and other exit costs | (3) | (3) |
Ending balance, restructuring reserve | 14 | 17 |
Other Exit Costs | ||
Restructuring accrual | ||
Beginning balance, restructuring reserve | 10 | 11 |
Net cash paid, principally severance, related benefits and other exit costs | (3) | (1) |
Ending balance, restructuring reserve | $ 7 | $ 10 |
Pension Benefit Plans (Details)
Pension Benefit Plans (Details) - Funded Plan - Pension Benefit Plans. - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
U.S. | ||
Components of net periodic pension cost | ||
Service cost | $ 2 | $ 3 |
Interest cost | 11 | 9 |
Expected asset return | (14) | (15) |
Amortization of actuarial loss | 2 | 11 |
Net periodic pension cost | 1 | 8 |
Non-U.S. Pension Plans | ||
Components of net periodic pension cost | ||
Service cost | 2 | 2 |
Interest cost | 9 | 6 |
Expected asset return | (7) | (11) |
Amortization of actuarial loss | 2 | $ 3 |
Net periodic pension cost | $ 6 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Income Taxes. | |
Statutory U.S. Federal tax rate (as a percent) | 21% |
Debt (Details)
Debt (Details) $ / shares in Units, € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | |||||||||||
Aug. 31, 2022 USD ($) | Mar. 31, 2023 USD ($) agreement $ / shares | Sep. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Mar. 31, 2023 EUR (€) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 EUR (€) | Jul. 18, 2022 USD ($) | Mar. 31, 2022 EUR (€) | Mar. 25, 2022 USD ($) | Mar. 01, 2022 USD ($) | Feb. 28, 2022 USD ($) | Feb. 10, 2022 USD ($) | |
Debt Instrument | |||||||||||||
Total long-term debt | $ 4,723 | $ 4,647 | $ 4,671 | ||||||||||
Less amounts due within one year | 301 | 26 | 300 | ||||||||||
Long-term debt | 4,422 | 4,621 | 4,371 | ||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | $ 1 | ||||||||||||
Maximum Borrowing Capacity | $ 2,800 | ||||||||||||
Additional interest charges for related party fees | 2 | ||||||||||||
Paddock | |||||||||||||
Debt Instrument | |||||||||||||
Face value | $ 8.5 | ||||||||||||
Secured Credit Agreement | |||||||||||||
Debt Instrument | |||||||||||||
Unused Credit | $ 1,240 | ||||||||||||
Number of financial maintenance covenants | agreement | 1 | ||||||||||||
Additional default interest rate per annum applied to all obligations owed under the Agreement | 2% | ||||||||||||
Secured Credit Agreement | Minimum | |||||||||||||
Debt Instrument | |||||||||||||
Interest rate margin, Term SOFR loans and Euro currency rate loans | 1% | 1% | |||||||||||
Interest rate margin, Base Rate loans (as a percent) | 0% | ||||||||||||
Facility fee payable (as a percent) | 0.20% | ||||||||||||
Secured Credit Agreement | Maximum | |||||||||||||
Debt Instrument | |||||||||||||
Interest rate margin, Term SOFR loans and Euro currency rate loans | 2.25% | 2.25% | |||||||||||
Interest rate margin, Base Rate loans (as a percent) | 1.25% | ||||||||||||
Leverage Ratio | 2.50 | ||||||||||||
Facility fee payable (as a percent) | 0.35% | ||||||||||||
Revolving Loans | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | 100 | ||||||||||||
Revolving Loans | |||||||||||||
Debt Instrument | |||||||||||||
Weighted average interest rate (as a percent) | 6.33% | 6.33% | |||||||||||
Term Loan A | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 1,426 | 946 | 1,426 | ||||||||||
Maximum Borrowing Capacity | 1,450 | ||||||||||||
Senior Notes | |||||||||||||
Debt Instrument | |||||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | 16 | ||||||||||||
Senior Notes 5.875%, due 2023 | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 250 | 547 | 249 | ||||||||||
Interest rate, stated percentage | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | |||||||
Debt repurchased amount | $ 150 | $ 250 | |||||||||||
Debt redeemed | $ 300 | ||||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | 7 | ||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 250 | $ 250 | $ 550 | ||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 99.99 | ||||||||||||
Fair Value | $ 250 | ||||||||||||
Senior Notes 3.125%, due 2024 (725 million EUR) | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 754 | 793 | € 725 | 731 | € 725 | € 725 | |||||||
Interest rate, stated percentage | 3.125% | 3.125% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 790 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 97.99 | ||||||||||||
Fair Value | $ 774 | ||||||||||||
Senior Notes 6.375%, due 2025 | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 298 | 297 | 298 | ||||||||||
Interest rate, stated percentage | 6.375% | 6.375% | 6.375% | ||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 300 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 100.75 | ||||||||||||
Fair Value | $ 302 | ||||||||||||
Senior Notes, 5.375% due 2025 | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 299 | 298 | 299 | ||||||||||
Interest rate, stated percentage | 5.375% | 5.375% | 5.375% | ||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 300 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 98.57 | ||||||||||||
Fair Value | $ 296 | ||||||||||||
Senior Notes 2.875%, due 2025 (500 million EUR) | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 542 | 553 | € 500 | 529 | € 500 | € 500 | |||||||
Interest rate, stated percentage | 2.875% | 2.875% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 545 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 97.69 | ||||||||||||
Fair Value | $ 532 | ||||||||||||
Senior Notes 6.625%, due 2027 | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 607 | 606 | 607 | ||||||||||
Interest rate, stated percentage | 6.625% | 6.625% | 6.625% | 6.625% | 6.625% | ||||||||
Debt repurchased amount | $ 88.2 | ||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 612 | $ 611.8 | |||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 99.85 | ||||||||||||
Fair Value | $ 611 | ||||||||||||
Senior Notes 4.75% due 2030 | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | $ 396 | 395 | 396 | ||||||||||
Interest rate, stated percentage | 4.75% | 4.75% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||
Principal Amount | $ 400 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 91.66 | ||||||||||||
Fair Value | $ 367 | ||||||||||||
Finance leases | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | 147 | 108 | 132 | ||||||||||
Other debt | |||||||||||||
Debt Instrument | |||||||||||||
Total long-term debt | 4 | $ 4 | $ 4 | ||||||||||
Revolving Credit Facility | |||||||||||||
Debt Instrument | |||||||||||||
Maximum Borrowing Capacity | 300 | ||||||||||||
Delayed draw term loan facility | |||||||||||||
Debt Instrument | |||||||||||||
Maximum Borrowing Capacity | 600 | ||||||||||||
Term loans in aggregate | |||||||||||||
Debt Instrument | |||||||||||||
Maximum Borrowing Capacity | $ 500 | ||||||||||||
Multicurrency Revolving Credit Facility | |||||||||||||
Debt Instrument | |||||||||||||
Maximum Borrowing Capacity | $ 950 |
Contingencies - Asbestos (Detai
Contingencies - Asbestos (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Contingencies | |
Sale of goods containing asbestos from 1948 to 1958 | $ 40 |
Contingencies - Paddock Enterpr
Contingencies - Paddock Enterprises, LLC (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Jul. 20, 2022 | Jul. 18, 2022 | Dec. 31, 2022 | Mar. 31, 2023 | Jul. 08, 2022 | Mar. 31, 2022 | |
Loss contingencies | ||||||
Deconsolidation investing outflow | $ 8.5 | |||||
Remaining assets | $ 9,061 | $ 9,425 | $ 8,877 | |||
Cash and cash equivalents | 773 | $ 480 | 519 | |||
Liability from deconsolidation | $ 625 | |||||
Funding to trust | $ 601.5 | |||||
Funding to trust through borrowings | 600 | |||||
Funding to trust through cash | 1.5 | |||||
Total consideration ("Settlement Consideration") | $ 610 | |||||
Paddock | ||||||
Loss contingencies | ||||||
Remaining assets | 18 | |||||
Liabilities | 30 | |||||
Cash and cash equivalents | $ 12 | |||||
Operating cash outflow | $ 621 | |||||
Face value | $ 8.5 |
Contingencies - Other Matters (
Contingencies - Other Matters (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Contingencies | |
Loss contingency accrual | $ 25 |
Share Owners' Equity - Rollforw
Share Owners' Equity - Rollforward (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Increase (Decrease) in Share Owners' Equity | ||
Balance | $ 1,528 | $ 827 |
Issuance of common stock | 5 | |
Reissuance of common stock | 4 | 3 |
Shares repurchased | (10) | (10) |
Stock compensation | 19 | 7 |
Net earnings (loss) | 210 | 122 |
Other comprehensive income | 137 | 156 |
Other | (6) | (3) |
Balance | 1,887 | 1,102 |
Common Stock | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | 2 | 2 |
Balance | 2 | 2 |
Capital in Excess of Par Value | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | 3,079 | 3,090 |
Issuance of common stock | 5 | |
Reissuance of common stock | (2) | |
Shares repurchased | (10) | (10) |
Stock compensation | 19 | 7 |
Balance | 3,093 | 3,085 |
Treasury Stock | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | (688) | (701) |
Reissuance of common stock | 4 | 5 |
Other | (6) | (3) |
Balance | (690) | (699) |
Retained Earnings | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | 885 | 301 |
Net earnings (loss) | 206 | 88 |
Balance | 1,091 | 389 |
Accumulated Other Comprehensive Loss. | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | (1,861) | (1,972) |
Other comprehensive income | 134 | 151 |
Balance | (1,727) | (1,821) |
Non-controlling Interests | ||
Increase (Decrease) in Share Owners' Equity | ||
Balance | 111 | 107 |
Net earnings (loss) | 4 | 34 |
Other comprehensive income | 3 | 5 |
Balance | $ 118 | $ 146 |
Share Owners' Equity - Rollfo_2
Share Owners' Equity - Rollforward Shares (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Owners' Equity | ||
Issuance of common stock (in shares) | 400,000 | |
Reissuance of common stock (in shares) | 200,000 | 200,000 |
Shares repurchased (in shares) | 532,478 | 800,000 |
Stock compensation (in shares) | 500,000 | 400,000 |
Share Owners' Equity - Share Re
Share Owners' Equity - Share Repurchase (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share Owners' Equity | ||
Shares repurchased | $ 10 | $ 10 |
Shares repurchased (in shares) | 532,478 | 800,000 |
Stock repurchase plan authorized | $ 150 | |
Remaining repurchase of common stock available | $ 60 |
Share Owners' Equity -Authoriza
Share Owners' Equity -Authorization of Common Stock (Details) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Authorization of common stock | |||
Shares of common stock issued (including treasury shares) | 250,000,000 | 250,000,000 | 250,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Shares of common stock issued (including treasury shares) | 186,417,000 | 185,568,000 | 187,617,000 |
Treasury shares | 31,143,000 | 30,880,000 | 31,401,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||
Other comprehensive income | $ 137 | $ 156 |
Net Effect of Exchange Rate Fluctuations | ||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||
Balance at beginning of the period | (1,280) | (1,290) |
Change before reclassifications | 158 | 130 |
Other comprehensive income | 158 | 130 |
Balance at end of the period | (1,122) | (1,160) |
Change in Certain Derivative Instruments | ||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||
Balance at beginning of the period | 4 | (21) |
Change before reclassifications | (19) | 18 |
Amounts reclassified from accumulated other comprehensive loss | (2) | (15) |
Other comprehensive income | (21) | 3 |
Balance at end of the period | (17) | (18) |
Employee Benefit Plans | ||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||
Balance at beginning of the period | (585) | (661) |
Change before reclassifications | (1) | (2) |
Amounts reclassified from accumulated other comprehensive loss | 4 | 14 |
Translation effect | (6) | 6 |
Other comprehensive income | (3) | 18 |
Balance at end of the period | (588) | (643) |
Accumulated Other Comprehensive Loss. | ||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||
Balance at beginning of the period | (1,861) | (1,972) |
Change before reclassifications | 138 | 146 |
Amounts reclassified from accumulated other comprehensive loss | 2 | (1) |
Translation effect | (6) | 6 |
Other comprehensive income | 134 | 151 |
Balance at end of the period | $ (1,727) | $ (1,821) |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Other Income (Expense), Net | ||
Gain on sale of divested business (see Note 16) | $ 55 | |
Intangible amortization expense | $ (8) | (8) |
Foreign currency exchange loss | 1 | |
Royalty income | 7 | 6 |
Other | (10) | (2) |
Other Income (Expense), net | $ (10) | $ 51 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net earnings attributable to the Company | $ 206 | $ 88 |
Denominator (in thousands): | ||
Denominator for basic earnings per share - weighted average shares outstanding (in shares) | 154,696,000 | 155,849,000 |
Effect of dilutive securities: | ||
Stock options and other (in shares) | 4,398,000 | 2,949,000 |
Denominator for diluted earnings per share - adjusted weighted average shares outstanding (in shares) | 159,094,000 | 158,798,000 |
Basic earnings per share: | ||
Net earnings | $ 1.33 | $ 0.56 |
Diluted earnings per share: | ||
Net earnings | $ 1.29 | $ 0.55 |
Weighted average shares of common stock attributable to options not included in diluted earnings per share (in shares) | 222,946 | 1,576,542 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Supplemental Cash Flow Information | |||
Amount of receivables sold | $ 515 | $ 461 | $ 535 |
Receivables sold under supply chain factoring program | 176 | 155 | 158 |
Interest paid in cash | 68 | 64 | |
Increase or decrease to cash from operating activities from factoring programs | (20) | (20) | |
Expense due to factoring program | 5 | 1 | |
Outstanding payment obligations to the financial institutions as part of SCF Programs | 120 | 99 | $ 110 |
Income taxes paid in cash | |||
Income taxes paid in cash | 41 | 23 | |
Note repurchase premiums included in cash interest | 12 | ||
U.S. operations | |||
Income taxes paid in cash | |||
Income taxes paid in cash | 3 | 2 | |
Non-U.S. | |||
Income taxes paid in cash | |||
Income taxes paid in cash | $ 38 | $ 21 |
Divestitures (Details)
Divestitures (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022 USD ($) | |
Divestitures | |
Gain on sale of divested business (see Note 16) | $ 55 |
Cristar TableTop S.A.S. | Other operating income (expense) | Disposal Group, Not Discontinued Operations | |
Divestitures | |
Gross proceeds | 96 |
Gain on sale of divested business (see Note 16) | 55 |
Gain on sale of businesses, after tax | $ 16 |