CCK - Earnings call transcript Q4 2021

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Operator

Good morning and welcome to Crown Holdings’ Fourth Quarter 2021 Conference Call.

Your lines have been placed on a listen-only mode until the question-and-answer session. Please be advised that this conference is being recorded. I would now like to turn the call over to Mr. Kevin Clothier, Senior Vice President and Chief Financial Officer. begin. may you Sir,

Kevin Clothier

and Donahue, With Officer. President CFO. our Younis call Tom on is, retiring Tim and good you, me morning. today’s Kelly, Thank Chief Executive

available have call, vary this in materially results number the will statements. release, If of crowncorp.com. we as the release, from making don’t website at such already it you could is be on earnings forward-looking our On Actual earnings a statements.

pension press a vary concerning and billion business. prior factors cause is filings. compared subsequent that SEC loss a contained to including the in release The related to plan of in earning recorded loss $X.XX paid UK to filings, the tinplate the charges share to retire information and our Additional XXXX year for actual $X.XX notes in sale premiums X.X The could XX-K company the results quarter. and Form in the of includes quarter settled to fully filing

of in in strong discontinued the can dividends. returned purchased volumes. and higher to the to sale result of effects share income up million the offset XXXX. Segment compared required from an the are to business dollar. to the the beverage transit As inflationary were $XXX was in and the of of and due and stock the in from from in Adjusted million primarily $XXX were sales and as $XXX compared $X.XX business, shareholders by in earnings additional $X.XX increased year prior the reported European all volumes quarterly We have Net the increased of million raw quarter material per restated year, of XXXX costs unit results pressures the a quarter benefit the $XXX quarter operations. higher periods been to XX% in tinplate prior through pass as

at and have to we of repurchased to shareholders in XXXX XXXX. in so stock return expect least million We $X $XXX again far an billion additional

between outlined share. $X.XX of As share, first full estimate of and $X.XX and we per adjusted earnings and earnings release, the per $X.XX adjusted in currently between $X quarter XXXX year

from XXXX XXXX capital be XX%. year rate between Dividends flow so full $XXX from XX% XXXX, first in tax of are of Bowling XXXX, tornado million. year Green estimates the collection Bowling December. These overhead at throughout profits was recovery year. assume interest million all plant, million EBITDA is increase the damaged currently loss We in current expected however, expected billion in from Green a assumes cash full to $X,XXX,XXX,XXX the assume of approximately non-controlling will estimates timely levels, $X.X exchange to $XX be rates which in The in up XX% spending. insurance between an billion billion earnings quarter The recovered of approximately with costs $X by from $X of losses equity as be and does million estimate defined the $XXX and to and year and approximately $XX estimate proceeds no years. or two full free

that, X times are and net in expect positioned times X.X We remain Tim. the compared We well to XXXX. XXXX for X.X year XXXX a leverage call between future. in for great turn had to and With the over to I’ll

Tim Donahue

everybody. to morning good and Kevin you, Thank

to Our of all families. the and continued for best safety you wishes your health and

the challenges again performance to Crown quarter, the operating our we overcoming the continually global serve past continued customers express to many fourth for of Before the for our years two efforts in reviewing well. their the team appreciation

that higher you rates you ask that data, we unvaccinated times among the almost who not many vaccinated know are we that hospitalization are are the vaccinated. which of XX you of While the boosted, consider and those than shows among

get vaccinated, get please you that remain boosted is safe. and recommendation Our

previously announced utmost the we integrity, strong establishing to alongside and strong X. in from retirement, and has his we growth. in the been benefited before from retirement. Financial the Chief on company advance Tom of a just January grateful created work professional thank stepped and him position his begin. much a happiness future my his I as wish As It’s few Tom his Tom Kelly entire words On for now counsel foundation financial continued under behalf Tom are for Tom? XX company’s stewardship, and Officer for Tom’s pleasure the for to the family, Crown family and down of leadership of than a years, And want dedication more

Thomas Kelly

Tim. my all you, Kevin, the over and It’s of positions these new Tim. those congratulations again team investment of and your in Crown. Crown in best been entire with of the been and responsibilities years. you Thank pleasure you working luck at with it’s and time during to a working my pleasure community many you

Tim Donahue

again. congratulations you, and Thank Tom

already quarter for of last we approximately for XXXX outweigh third even achieved. commercial through described, October, company. be within we believe beverage Record units XXXX in in XXXX. capacity release year most in an continuing outlined segment With between numerous were future Kevin in journey. release, invest earnings end was markets, share, with XXXX Included demand EBITDA the per better. been the our and supply billion in for night’s described commercialized global continue or as will income our sustainability earnings outstanding As we earnings of to to And performances beverage startup can achievements XX growth, having cans announced

quarter, we operations productivity tornado, resume volumes the immediate strong unfortunate December, operations completed fourth the EF-X both hit in in loss construction prior of resulting year unit can. world higher volumes and across the to boost imported most the year and and from the in-line tight segment into in Bowling Kentucky We how the have X% States demand, Beverage, on already Americas increased income to beverage XX XXXX full year X% achieving XX% an demand the Reported a units and lines to Income higher Green beverage still segment even higher and package in food aluminum revenues the rates and the as In recycling will recycling seven with North demand as remained the year. in Inflationary direct took at content. but at situation meet pass-through curtailment fourth cost being XXXX. of across March. four In since costs. volumes, costs. to In is XXXX higher production by can production for evidenced of and beverage prior plant the geographies. To outweigh the plant. to all capacity the in rate the In was our transit with comp. new additional continued the beverage lost, An at lines recycled healthy United and XX%, down announced due Green. given rated coupled America, commercialize we Bowling many global to growing are as committed increase is, newest strong in businesses recycled the quarter and The inventory quarter prior the goals as an to we material early aluminum billion and Fourth currency unfavorable supply XXXX. expect with advanced from raw but a during sales the onsite market increases quarter in can higher offset circularity

XXXX, for and Green. the to Bowling strong earnings contractual double-digits, weighted for our to the the recoveries will ahead the insurance European Mediterranean advanced Middle due expand of back Unit to noted East again in although year related full operations. timing Beverage with Looking in expect XX% be timing and volumes quarter, pass-throughs volumes XX% PPI across in and of fourth we this the year towards that half segment to

gains. expected, the due and more to declined quarter in materials, the income As cost of for pressures benefit inflationary offsetting segment utilities than fourth freight volume

the are to our XXXX to beverage Sales will two non-material Underlying eased the contracts in implement expect remain quarter increases and taking and quarter. challenging for believe material fourth is reopened cost economies actions growing the region demand unit over Asia-Pacific as the XX% we next as quarter the much over advanced X% and price the lockdowns across completed price and cost recovery be cans year aluminum during program largely hard of and will renew. segment volumes the fourth increases for third contractual the recover years. properly during imposed We

Vietnam During the Tau, a Vung third operations at plant. began and Vietnam quarter Hanoi of on XXXX, quarter fourth facility can line we the new in in the the second in beverage

transit improved Cambodia. XX% we on material segment normal double-digits, and Additionally, be production our increasing to to in line tooling back growth plants during is XXXX, up advanced and packaging offset XXXX another product Almost XX% six quarter up across including category three modest in efficiencies in and production fourth costs. to higher service. arising Phnom patterns protective, the expected third Income can in every lines more beverage quarter volume as growth income expect strapping, average to are plastic with of from weighted the Penh footprint was equipment the expected raw segment Sales in film volume XX% gain. of the commercialize

making we quarter equipment timing deliveries offsetting in was easing American income of shipment inflation food, an equipment up demand XX% or and chain strong and pressures. million year from the the was expect business. gains For can beverage Fourth in and $XX supply segment improved XXXX in ultimate North further cost

XXXX, in expanded of Iowa, food Hanover production plan. a we capacity addition Dubuque, to line During and plant the two can with of the new piece the new completion a Pennsylvania

equipment the contractual earnings in higher cost We improvement from can expect in and higher pass-through deliveries, volumes, food significant of XXXX inflation.

summary, XX% and European European reduced and divestiture expect the billion and importantly the in the XXXX. significant Despite tinplate can XXXX. year business, we in of capacity estimated So our beverage EBITDA in commercialized a and over $X new completed pension in XXXX. assets, busy outlook XXXX challenges strong is up food our for obligations, We productive of

reaffirm of cash is generating $X.X balance range also $X billion EBITDA at solid of least billion the reported and our XXXX elimination in our the Investor within during Day. pension flow. We May provided leverage the With estimate sheet strong, liabilities,

many to for queue. future $X in invest more again there the than return in shareholders are continue to growth expect billion businesses you of and XXXX. our see We in that We to

get as to that we’re Younis, we questions. now to may we to before to to ask questions that And two as yourself the of call so we that many possible. open with the you ready you call So open limit questions,

Operator

you. Thank

is We Castillo will Our [Operator question-and-answer from Stanley. Instructions] now question of Angel session. line the the Morgan first begin of

line is now Your open.

Angel Castillo

question. Good taking and for my thanks morning,

as quarter Let region, and XXXX for as also I guess of throughout in terms kind I just out, well? think volumes seeing start the should that we how me of the to about cadence X% you’re about the what just wanted by ask, think we

Tim Donahue

about X%, but little talk a only to thinking January the volume for expect release total, in about we in too we’re Asia. we growth double-digit next Probably perhaps behind going early be think to up us, first the where say than in as more X%, I little a quarter, year,

both Americas with flatter, growth perhaps very currently volume Brazil in capacity And I Europe growth we think a up we are and North double-digit in X.X% year. America we segment, for be expect and Europe, the expect in being constrained the strong. to

Angel Castillo

how impacted Got volume? then, or incident very think heading I’m might sense of double-digit maybe in the may feel maybe that that Green just have and impact about as about you the have helpful. be your North an how about you inventories inventories, America. Any year? for of That’s there think in for where it. terms Bowling we as And of much that kind just may

Tim Donahue

Yes, question. a good it’s

have for through next line certainly we’re plant bring the guys month, debug begin for in cans. we new bring So system cans They’ve one months have going want to have to to the say up learning these but again, not been it’s a I making curve I making don’t get and we’re bring going. to go first as that lines second the is, going back years been will we’re XX to to early plant line now. to, the the XX that its think, factory have up, back After six to are up, equipment. going the there And to

So it’s nature not them. to necessarily second

and some get and retraining through. some there’s to back curve learning So

of your will double-digit inventory America estimate I system and tell it change doesn’t our help that in for from North originally even growth capacity a lines Bowling up. might back full we we you question, certainly we will did one the as it year position. did So that, not, year. it it’s the not the plant said Green lose Having out have of our bring expected, to in for what

As you’re hand market well are we mouth, all but tight. say And I is very importing still aware, cans. to don’t the to market The industry tight. the is, extremely we’re is want

import lower But, to first would will obviously the than are system liked challenge. cans inventories and right year. we of on Green customers We our as the cause now we will the and to that overcome service Bowling quarters have the some two a little get through strain

Angel Castillo

Appreciate so the color. you Thank much.

Tim Donahue

you. Thank

Operator

Thank the of line is from you. And Mizuho. question Christopher the next Parkinson of

Your open. line now is

Unidentified Analyst

Thank is Fein this Harris on to versus XQ case what and year? for expectations across you. Can and far in just Hi, you the Chris. XQ sitting balance logistics evolved base are are geographies? challenges transportation thus for speak you the How that the please they’ve seeing of your

Tim Donahue

are especially they Europe see of ships, raw are see the necessary, time through raw others. longer it’s I more are considering container once any the port with overwhelming and to materials to others on goods the transportation finished like delay, at perhaps, little our issues but as managing certainly still still I point. don’t on it are I that it challenging like, arrive and than relates I challenging. think to continues at challenges There And challenging in materials, markets there that unload be is mean, currently Europe transportation water, customers. somewhat are that the this delays is any Yes. side numerous to don’t the some most we than a we on certain

Unidentified Analyst

has commentary Asia, versus specifically, to give is into your plays situation and that as regarding the EBITDA any there insight guidance? other prior Vietnam that can Southeast how you billion evolved then, $X that how And

Tim Donahue

probably year, performance real We’ve shutdowns each I had next Yes. the because Asia. of severe Listen pandemic treating of Asia. We how learning due last most growth to expect with for endemic virus. even as that double-digits only it. live it We remember, long a the strong this have significant to beginning growth, and all for of they’re down towards countries, year in slightly I appears growth going think was that to exception the can year as pandemic we’re to as only to the with in which opposed because year as we’re had evolve

for all So us, open big right like Cambodia, that feels it I now. think Southeast in Vietnam, Thailand the are currently Asia, especially wide markets

Unidentified Analyst

Great, thank you.

Tim Donahue

Thank you.

Operator

Thank you.

the of is Securities. from line Our Roxland next question of Mike Truist

now is open. line Your

Mike Roxland

think as the retirement very to mentioned much. How not just and you supply obviously like. coming do or best think levels logistics and endeavors. we you for, you your One once being now, worsen? Thanks viewed Tom Kevin seems your going or of months quick higher be levels on luck start it it months off more Congrats hoping future think of the of isn’t issues inventory chain XX about inventory Now would this, whether you think pick conditions congrats would where inventory six in on your from it you case to on. And higher So carry it well. carry you revert do past your conditions side? is as new it other Tim than again, like in inventory do out you’ll question forward? get role levels current

Tim Donahue

in depending to Well, answer. you’re ask you going the get different a on company, who

to love be manufacturing if they higher able you to inventories. folks, that’s talk carry our So to

is markets get and because I we’re to think past we operate. to inventories, luxury even almost production, as we’re not carry restart higher in the is, all full back to where the the have we so situation Bowling strong the going demand Green

possible that offering quick trying industry more get others consumers. for capacity and demand growing So to as are trying of serve as customers as in variety in a our we constantly products to our are to

is strong. So commit expect I to and capital over just we going ability any we’re over the we’re so demand several the region ability. else In to capital. think remain demand going to don’t I one have don’t strong, and absence of going We the to inventories is committing the grow know, to that have given if for the to or anybody next years

be markets each to in. going how deploy we operate capital into to responsible We’re the fairly of as we

Mike Roxland

one thank up. Got And you. follow just and quick it then one,

that every far? contract was is the some the with comes you’re contract European progress you How the done thus some you’ve that customers. that pursuing or taken? You earlier than Can wondering for about has realizing at far? the mentioned mentioned You been mechanisms year up proceeded? to renewal actions you what different talk every conversations recovery what feedback What those thus of times, has cost Obviously two been, the try different about of to mentioned have correct these. horizon have

Tim Donahue

Yes.

Europe just transferred some North time the different. where the and commercial convention, The has have different America been pass-throughs trying contracts who ultimate convention in our is in been raw we’ve to in direction pricing to for our So to to contract commercial move customers of compared risk consumer. material for power Europe contracts, a more

that so And some will take time.

the is, I growing in cans. certainly good cans Europe, news in think customers Europe. a need to market in so America, the There remains North the is as we’ve shift tight seen

contracts the to stages going we of over renew two renew years contracts said, complete the variety So but into of next the as XXXX this over years, in expect the two largely this, we through XXXX. early next end are as we of

Mike Roxland

the in luck Good quarter.

Tim Donahue

you. Thank

Operator

Barclays. next you. of from question is Thank line the Leithead of The Michael

Your now is open. line

Michael Leithead

good morning thanks, Great, guys.

well, of as you can get and the how Thanks. for maybe in how And pieces region about Tim, terms mentioned? split Americas the that between unpack moving growth there of North that differences South First should between fast America. is earnings kind catch then, price 'XX question each regional think quarter you up you on Beverage, in the

Tim Donahue

good ask top Kevin. had to the long-term, with cool for have economy season I'd a head America, Brazilian growth growth you have bit front we how Mexico. was in the good or little bullish of market. my there all had and modest in me the I still we really -- in Tom follow-up I wet, the Yes. cans exceptionally the now. don’t more given of perhaps volume Brazil just we remain don’t the of and is of North in and certainly, softer a But numbers

Brazilian the be challenges will short-term to get It's about resilient or never We excited over too proven in near-term time. market. exceptionally

that come they through PPI most and not QX will in -- recovery will think of all have the I QX.

by So QX, back we'll that in largely the of have end North America.

should the the not going Green Green We're allowed You to recovery to Beverage be segment full-year, related of the a in the QX and due in recover largely of have the year. going until be Americas strong segment another not for to to expect Bowling Bowling any is see probably to to QX from hit perspective. hit. QX But that income later just in last in will segment year an that performance income going and it's the fact the to the decline record we're recovered PPI in the

Michael Leithead

helpful. guidance? And currently for share maybe level EPS you're then repurchases Can year of super just the 'XX speak that's full-year Okay, you incorporating a in to just quick follow-up Kevin. that

Kevin Clothier

close to -- at in yes at we'd So Michael. looking of spending an around share X $XXX. price shares a a average assumed We're million

Michael Leithead

That's great. you. Thank

Tim Donahue

Mike. Thanks,

Operator

Bank Staphos the is of of from of George next you. Thank question The America. line

open. is now Your line

George Staphos

cost Green what the out was what on negative XQ. of and actually in tornado you. Tom, longer-term or everyone, know it And and Kevin, kind have called morning. to details. and perhaps or is, one the congratulation had been the pleasure question don’t for I the working Kevin, missed I shorter-term for damage the it the of congratulations; and It's you impact the years. a Tim over round Bowling XQ. all one and recovery the turn, Tom Hi question. effect Thanks either -- again pinwheel I with including network if in in numbers you good the

Tim Donahue

Yes.

George. So your think round I $XX number for million, XQ, about

George Staphos

Okay.

Tim Donahue

mean that Green million doesn’t that And quarter. per $XX Bowling contributes

George Staphos

Understood.

Tim Donahue

going we're cost insurance we stress we company. entire business. The incremental But incur continue and that incremental for customers from the existing to it’s to the but system the incurred, cost to ultimately on service the recovered tried

George Staphos

Right. comparable? And for XQ was it

Tim Donahue

we Think $X lot on but but plan of that maybe No, million number but $XX to I the site had it’s an of loss. We part loss. million, was units a order big a was maybe we about -- the XXX we X'ish. on inventory of have which had, maybe had probably XX $X to was units in million say to exact the not problem don’t inventory million which going that of

sure but that of end would how So, much the significant of at have month I'm of been not end through portion. the sold the

unfortunate. yes So,

George Staphos

longer-term it, appreciate thankfully from one the Tim. question. could I hurt And no was Strategically see No. we again, in what release. a

perhaps the you do and can in sector. Strategically, strategically to quarter, way business. point go-to which that particular you in these on a standpoint in in it it core guys. beverage and reinvesting the many have market many, more the has does help help think can in Can use how understand you commercial luck operate disclosing you'll a something is in are some also data and crown good and you years. us from on Thanks, there you Machinery a again for machinery. at You business the food been other segment if is be

Tim Donahue

George. Thanks,

based on the we business the substantially acquired can a since UK, grown out it’s when XX little ago beverage it equipment years business over of So, then. that making we've

couple within of so of assuring leading growth line, pieces about growth. that industry the Strategically, that the many industry that is tremendous beverage many pieces. the the bottlenecks of now, is for those you think our the experiencing believe to think can there are we for equipment as right I a standard

is the time. equipment one procuring or other aluminum procuring One them it, enough the of on and securing of is

disclose of helpful in to supplier to standpoint has our from turn can to that our of time -- line having our the able two. the thing our equipment helping about be I just about a slots more advantages, a growing as of or strategy, to get long-term it's Higher shareholders assure business. it's I business, an own is our on on decade to producer equipment strategy. a much speed, too or company technical other elements meet for demands helpful variety a we're that helping it's the that’s remark talk be the the not business manufacturer to getting lighter customers. of I'm supplier equipment very transforming equipment weights, the a of one proven to in better get just can hesitate strategic understand we in our equipment with necessary power over transformation, that suppliers so, needs business equipment to only talk think I And also other make equipment certain get the of last it appropriate strategy. equipment knowledge growth not things and equipment and our it own but to that's the don’t But rapidly it’s business any installed if

aerosol food business it we As relates more that. the get remaining in information and disclosing what to on and can see we'll equipment,

George Staphos

Okay. Thanks much, Tim. very

Tim Donahue

Thank you, George.

Operator

of the question The of Ghansham is you. next Panjabi Thank line from Baird.

Your line is open. now

Ghansham Panjabi

morning, Good retirement. the to I'm these Tom, forward. just your you'll going miss in calls And sure you. want congrats echo Thank everybody.

Thomas Kelly

Ghansham. you, Thank

Ghansham Panjabi

and operating X on million to leverage or the -- know between the that XXX growth million X% leverage I'm plus Absolutely. of in additions a about year. estimate lot XXXX so for with first shake of bridge there's growth or the I based how EBITDA volume the and million to XX imply XXXX XXXX I be the on parts. X% sales? guess, new you maybe What that differential do million saw I trying for base, for off cans you $XXX assumption of just, moving XXXX. so guess of kind And level operating last

So maybe parts. of out can some break moving those

Tim Donahue

Yes.

was XXXX, EBITDA Ghansham, I going is half equipment and the transit, aerosol you and half business I strong between have and businesses. food a in of been to back in the We're can think can is in two of performance the better volumes. that for short going piece from the XXXX our own to a million perhaps made either Europe is significant few So, of recovery States. transit's businesses half food particularly which those $XXX in sourcing of now and better in back PPI that of fairly food beverage here equipment operations going two cans and global of growth and in United we've and do years on -- to or do over former capacity the combined We've acute food and equipment piece been sister competitors -- with

our profits else So in our make own that significantly transferring were can future. somewhere we'll recorded books to own the

will So that would Europe's said growth in of be I the the split. of segment be down, beverage, we global in half it's much earlier. that be so And if Americas to going as alluded to

Ghansham Panjabi

constraint, XXXX. in in you're terms on being Europe $X billion CapEx spending of then, comments terms thank a And your you. somewhat capacity Okay, of in

of we projects spending to CapEx how about Europe. including competitors region that Europe, going relates of I main Your your guess think in sort Xx as should footprint forward? evolution it that towards in the

Tim Donahue

there there that are, not for locations is billion haven’t we Europe, sitting $X of think $X we Ghansham, announce number, Europe, hands that within that's a piece announced projects significant reasons. have No, the on to yet. billion other I those But certainly those our just we're yet in

Ghansham Panjabi

so you, Thank much. Fantastic.

Tim Donahue

Ghansham. Thanks,

Operator

the is line from Mark Montreal. you. Wilde next The of of question of Thank Bank

Your now line open. is

Mark Wilde

question business. of lot kind industries? and automation have and on working the Tim labor my congratulations first I really push the a there Did Tim, enjoyed in of to add see transit I morning, I that Kevin. and increased you. that reduced by acceleration just we're underlying Good you an And seeing growth you, with will there Thanks. driven packaging just Tom, in Tom

Tim Donahue

quarter average The easy up weighted it my in compared to we're volume XXXX if a if fourth year's XX% absolutely. back an to I X% growth go we over weighted compared negated volume to short to prepared against that XXXX, XXXX. mention answer remarks XXXX in average but was is, was perhaps this comp, we

describe we for you, So there harder. lot in those investing money transit is this of we're running we're just assets a as is and world, not

automation organic companies all and but everywhere business We is where this transit see we of more see to absolutely. the So it manufacturing than it in prevalent do want volume nowhere process. the backend their automate

-- transfer the the packing -- the expanding, product, way. the manufacturing that they which with say I'll they transfer at rapidly through from ultimately distribution automation So just end warehousing yes. of manufacturing point stop it is how

Mark Wilde

five be runway? much you I years many that have, of runway How to might that Yes. then because how mean year -- and think three a easily

Tim Donahue

three long answer the will tell of time. equipment to What five years three Why through bought $XX and I think even we million. the when I don’t well backlog business the tooling say easily you $XX was end and is could in about we our XXXX, million to say years? just I a

And We $XXX now. in are million backlog over right --.

Mark Wilde

And helpful. that's --. Okay, the other

Tim Donahue

So Mark, I -- of is I escalation -- everything labor, that's going shortage with given this yes, the us I on think here think this that is stay. know cost labor, at to -- labor I

Mark Wilde

on the could key us just or of three you are that points beverage going also help of that two and recovery kind Yes, recycling give rate you okay. cans? increase Tim, kind to

Tim Donahue

like work we're on comes United states just We exceptionally advantaged have I higher in that than States, going that to are deposit down have rates for know the countries don’t in think in less than much rates So all recycling know it to programs, high. states them. collection. which collection, are states, economically the States the to collection -- the have are We right? United example,

be States. the in Europe more the greater are have-to-have the get responsibility a United the big focus programs quite And America, certainly But than up have-to-have to producer to to Latin do higher growing there. driven we're rate are In potentially will We the going by at we United know high. collection deposits the rates more states. shameful. we're States, rates perhaps on extended need and get So it's in but U.S. XX% to going

rate not very recycling in in food increase. Given aluminum the aluminum the needs graded of physical to where of come that circularity it's that a container and property stream the value back nature as has aluminum and the and can rapidly the given

Mark Wilde

I'll Okay, it that's over. helpful. turn

Tim Donahue

Thank you, Mark.

Operator

Phil question Thank line you. of the Jefferies. And our is Ng of from next

open. now line is Your

Tim Donahue

next Yunis, don’t Phil? move we why the onto one?

Operator

The one line from Sure. Anthony of is Citi. the of next Pettinari

now open, is line Anthony. Your

Anthony Pettinari

And And congrats and over Tom years. Kevin. the morning. for thanks all Good Tom, the to help

Thomas Kelly

Anthony. you, Thank

Anthony Pettinari

you there's of globally. just the cans cans maybe are quite expect demand was where supply or a tight to supply regions where relative any versus worser state demand demand your I you'd is is would of possible maybe sort look just if bit of of about markets supply demand wondering markets balanced demand where you wondering and than And regions strong it Bevcan to in balance But know sort don’t like. I kind your could maybe when in characterize you're I'm which the supply maybe obviously import big is balance, importing at more XXXX uncomfortably and if through regions? looks go talk

Tim Donahue

say let's or think I comfortable. But Anthony, on operate with don’t what now and China East you is the oversold. market of Yes we the who Middle that it depending you is as in characterize know exception I that every are, uncomfortable do

Asia the the as the out is XXXX East East out market in market in one market, be in we're not fully but Middle oversold China. have might sold We're is perhaps a in sold will and Asia be there fully is but cans the we where area available. slack XX% we're in well range The China, Southeast Southeast Middle oversold.

the every at short oversold for Asia. next continue couple import United we least. but tight Southeast tight other States of is to as if So in we're again to market. markets oversold years, we're in And exceptionally not will the Europe be

short-term market or healthy weather from seen issue Brazil. Brazil concerned This of this little, is is mean much. exceptionally So a a that might I long-term and percent, loose the I growth. before for don’t when say a nine couple And I be mean is But six year. we've of with time-to-time, a months this this can in nothing the Brazil or maybe in economy for first little that's a again, future

Anthony Pettinari

sort your we're was it Okay. do business the you years back Bevcan of That's And benefit very demand, at to if into growth next you of get helpful. a as that kind net of is maybe or or picture year the a look some perspective, it think was it big there one-time And maybe benefit, a was structural or pandemic of accelerator growth that neutral from pandemic. you later the view or back negative. a Tim, risk net maybe accelerates sort then, two When thing, was this pandemic any year.

of on Just thoughts wondering picture big kind that.

Tim Donahue

Yes.

things to COVID. the supply inflation if think think has thing the other disruption point behavior the in you COVID, out, want changed. as with chain One I that associated blame caused partially on I you So consumer all by

tell what is view would guess permanent more you in that it's structural the so, or consumer that changed. behavior And with has nature I my I

consumption increased cans at-home be the to consumer beverage or and -- and it that cans change and I for I I years believe a do last think don’t believe certainly two food over behavior. whether has is

eat as if you and the and home out be. have experience experience, restaurants reopened it cost bars service outside outside the is of the most different home experience, to The the an experience. and at as not the eating people. for consuming think prohibitive out I experience a is good The have and is even look used It's cost to reopened. as the economies now or consume lousy, of

whether or a a than the steel can permanent So benefit come. I think years that's more think consumer thought is to at-home food behavior beverage And the have would ago. for I consumption we it’s can a can that'll change aluminum perhaps year

Anthony Pettinari

very that's it turn helpful. Okay, I'll over.

Tim Donahue

Thank you.

Operator

Thank you.

line the on from Ng Jefferies. Phil again have We

Your line Phil. is open, now

Tim Donahue

Hi, Phil.

Unidentified Analyst

morning. Good Jefferies, Tim, you how John. doing? are

Tim Donahue

you Hi, how are John? doing,

Unidentified Analyst

the you think the I tight day levels. all years. going imports. that the I like to industry out gratitude able see sorry still that the did want terms to mean, forward. in for I times us me forward sounds still touch over U.S. XXXX. U.S. insight and Kevin or be be the working Tim we're hear can to you're expecting two XX% we insights I'm looking been mean, do the with supplement then, year-over-year calm showed for sold the which to December pre-pandemic they to about came to kind for early in of is like Obviously out provide or down it morning imports And really three this want my of through capacity get just on imports levels. imports more for I demand he's the can the to you normalized guys -- to but needing you apologize, extremely but extend I'm Tom continue the back outside current into before year I to

Tim Donahue

to And increasingly think imports enough imports we're But wouldn’t and sit brought season, in a promoting the to companies then, And from companies and so products to not industry strong years. Crown service are they marketing the more that where until throughout going everybody continue upstart can market for would PET. be introducing aluminum I the them. get why XX all But come marketing you, opposed established the standpoint the to think going softer at use in companies as new as units large sustainability or tell turning XXXX. the in to units and to are like are efforts it'll of recyclable capacity in I whether reasons into it's know as It's our aluminum next consumer There to business. opposed into -- couple much market the capacity we in of try I their in the And that a I sit we industry the and being too in XX to PET. XXXX. level well are bring billion others company believe I or bet don’t at I I December lower. read in part in billion a can't and units billion is in we least listen, away 'XX. still I our right? XX here, I or I of as think industry here that

Unidentified Analyst

when a Understood. you the bit project capacity to the supply much how online disruption, broadly just And new And in you all the on. could just Have line you're have terms led? pivot that then timing coming XXXX. delays little because you announced in quantify any in and speaking chain of just the Cambodia to capacity experienced maybe newly coming of

Tim Donahue

when the up about XXX in line delays, get and of units. we we future new to we right thoughtful the it'll million equipment get be And terms significant think out in and the We orders that is I Cambodia third chain up only have in mean, need so equipment -- running. start sized I quarter. needs for now. to initially such placing the of pretty think the installing we long it's listen, try Supply So our understanding can our some the for I be

the problem, early challenging before, think was-- on about have it have we're may was construction but I talked we we now, one real think only one so. steel that through issue I right and

Unidentified Analyst

turn you. I'll excellent. over. Okay, Thank it

Tim Donahue

Thank you.

Operator

Fargo line the of Hajde you. And is Wells Thank next the Securities. of question from Gabe

now open. is line Your

Gabe Hajde

Yes. Thanks for congrats. taking the question. Tom, Good morning,

Thomas Kelly

Gabe. morning, Good

Gabe Hajde

Congrats. Kevin, you. Tim. working look to Good morning, forward with

Tim Donahue

you. Thank

Gabe Hajde

into of the you forward kind let know I typically, Tim Yes. preview to us year. fairly

I those you're in obviously, but mean FX any availability, about Can so, EBITDA. to $X material on would some be headwinds talk effects whether don’t say We're chain. then I expecting You magnesium keep of put on thinking get at that and Bowling billion up think that would risks kind you’re the and you and the you you're us from I despite I some told did way that this hold call about reaffirming QX at or or you Green that aluminum, ripple what would below that know, it's point? through I that know, you night don’t today

Kevin Clothier

think wrong, there is nice to I and go a seriously you? always cold Anyway, no You Gabe. just throw don’t listen want that blanket, something on water it can

recovery momentum know contract is related recoveries PPI a strong. got as to but we've little year be a really the in Green going described issue lot Americas That's we of softer around the here, timing think to Bowling the just first going is quarter we I and Beverage. be a

third and that to currency some more or from Bowling moved the taken Green other have the things now as favor but interim. there's point well quarter towards our in until obviously Your

on. comfortable And minor some we felt so, going feel today feel balance in the of we things other think on I October as still despite as

concerned so not I'm magnesium. now I about right think

think I mean say to that may others want Ukraine supply think and I Aluminum supply to be gas aluminum. globally. invaded Russia tight is the I down globally, I but is so some the metal, metal mean metal Europe. for concern Western real I shut tight -- a general worried, get they you When

come can you feel right we of now pretty scenarios all up Okay, want but you kind with good.

Gabe Hajde

Okay.

that these quite of Now of clarification. quick stuffs, to hey congratulatory be able more like some so. was honestly were you a A overcome meant guys point

capital where doesn’t So mentioned, not two capital working that a to because be was or reference XXX and Was you're as you guess other was of always mindful of more I a I or where terms the of a was was it that context capacity. of need it the You capital in if still to had use could, And capital comment something inventory? one in uses. part that like trying that to capital permanent would number working more Tim, more think that's I be be continuing something and be disciplined. per

any Thank for that look So you. what view number for can XXXX? like

Tim Donahue

sit when more than to I'll may was of in so we've all think we long people back years. soften want to that going want long-term. time other us you for we So the in unless the with would But or least. demand part have have time all Kevin, to have hope right had. couple willing of would but to and we around strategies as if out to are of the would may comment out demand four explosion to were the you we'd to the five a And to I that – in the that. future. just lead need the the strive don’t sitting of the buffer not I on are capital more And part? of we, we I inventory little come we're happen inventories purely I called that and My of in and or or back that inventory And in think going Kevin future. think to a don’t just be if going will ability want we we on We're let were side second to economics levels be deal inventory theories put explosion bit this that build here hope we to capacity years and at perhaps today, come

Kevin Clothier

Yes probably sure, add looking do capacity. going to. of and terms working to I'd like We're we add Gabe, invest the need as to capital we capital, we're plans add in that. new working as

build, capital today, least $XXX see at as a at we So, million million. something it's possible. it working as a much it's probably we're But looking woman of that looked as in $XXX we that at neighborhood of

Gabe Hajde

luck, I guys. Good appreciate it.

Kevin Clothier

Thank you.

Tim Donahue

you. Thank

Operator

next question of our from of the And you. Thank Viswanathan Capital Arun is Markets. line RBC

open. is line Your

Arun Viswanathan

for taking look all Thanks forward to together. my Tom. you Great. work question. as Thanks for Kevin I to your well. help, congrats, And

guess Europe. my is I just on first So question

describe you we a You noted America, contracting have two of year when going trajectory. A it as a just to opportunity that Could North ago out sold in this characterized was recovery cost are years couple potential process little the there? in you for into opportunity characterize say do market market? had or bring similar an a level. mid-teens and you really now up that to that returns a that there is lagged how Would you Europe while the the

Kevin Clothier

Sure.

needs us the provisions inflation, ultimate afford in customer. The to tighter in Nobody it From chance of We the the similarly we we've around to allow get couple if and two years tight get recover that's pay to the think that. efforts the supply that. in profile as there's to with characterize a time-to-time, satisfied we remain margin pricing can our I customer has lot the was to only cost. the And would years and a times is had America to in I for our market going for fully Europe over haven’t. ago. our contract from regions. one be the next ensuring of North tight Europe power, and expect consumer been it our consumer or chain largely would pay certain

margin would margin from previously fairly were expansion levels largely around where but only characterize to recovering I So recovery satisfied. our we would quarter efforts our imply levels fourth cost may imply which back

Arun Viswanathan

And do if to right? say the growth, for transit the recovery industrial in you're not of we guiding on know as seen would you expect kind you well? what Thanks continued it. EBITDA then We've that I and Is just a Got 'XX in EBITDA there. EBITDA from expect fully quickly 'XX are weakness, packaging. that. that Would you that growth but growth is recovered in nice COVID real inning business

Kevin Clothier

the think expect 'XX, want chain Largely The will, you headwind if we blame 'XX the still pressures the chain. EBITDA circuit which boards, we is on have business. if like COVID equipment and COVID yes. would to for some you things remaining growth that COVID, is I supply supply shipment tightness in would motors, around be of that recovered are delaying from only of in answer some equipment There

Arun Viswanathan

Got it. Thank you.

Operator

question of is you. next from Thank our Adam line And the Josephson of KeyBanc.

line now Your is open.

Adam Josephson

add And for you congratulations real Thanks. Good it's over morning, everyone. the as years. pleasure everything Tom, you've been done my me with Thank a working let well, you.

Thomas Kelly

you, Thank Adam.

Adam Josephson

And question strategy. for you on can your food

of XX% So obviously business year. your you sold last European

adding base? about And Europe? are the your Can pretty U.S. then how in company capacity are versus to your adding you just about the capacity relative what talk capacity how also to food core thoughts with existing help U.S. U.S. in You're cans you're us the much significant

Tim Donahue

America. in former up procuring some our most that I and Dubuque, third from two-piece been including as for food competitors Hanover expanding line here. you cans of we've Olympia third quarter Europe our probably to the will part sister If in and you and the the in come North go from through XX% the company line Adam, said, capacity can And third which 'XX, add in line others

as been responsibility While we lot us the a cases, our coming to to And rely on and us And for we and that serve take family-owned as trying that it's businesses their well have to responsibility we don’t that's can. meet run a business, demand. products suppliers can. provide great responsibility on as quality well to these to as and we that as we in put can own We're we lightly. are customers of they really the business as them economically which

company. what Whether organization us said I do package packaging we're a company. own transit really is growth trying food which return Now, packaging a packaging, make while we beverage lot to other the or the possible we we're to to businesses which us a And generate shareholders or allows run an fund and good and we're businesses package much is allow shareholders. business of generate and and and as some returns a value cash are value significant of to return to

I business more So than describe to don’t other. core as the want one

you I and or those growth how are when income we much how think consider much cash growth from much flow, much can core flow businesses. how how there cash get

Adam Josephson

think Do aluminum cans you structurally follow-up and One think that. longer-term beverage have than Tim, food short-term cans you other? to has benefitted any steel both the that and mentioned beneficiaries been both more the from pandemic. business you

Tim Donahue

because whole would beverage big the benefitted I pandemic where they have push and cans real perspective the anymore. check the more other big move serious benefit programs to understand box is aluminum They've move. has they food just the to cans have while they're say right can't from from an they They aluminum demonstrate been to probably cans towards the in beverage plastic. understand got on and retailers from sustainability but It ASG CPGs sustainability from pandemic that

Adam Josephson

Yes, now understood.

quarter lot categories last what which your of year seeing what grow and just are on the also you most about where is from bulk your you appreciate there by I and exposure industry's America but why? North and fourth substantial one perhaps expectations the quickly, about just in category you're Just overly it's the terms I talk mean there's one expect about growth of talk or then Tim. and Can how your for a you in come experience growth the not this that Beverage been slowing

Tim Donahue

drinks the exposure have and energy The being teas you think probably is limited. to continue well. on rather that’s obviously much lower energy much as growth drink growth biggest base than shelters flavored CSD CSD Carbonated and say bigger spike I And not. lower -- see basis obviously aluminum a waters percentage we we -- but offer in and base. as basis of to we're much

CSD flavored in terms in drinks. of water, So units, sparkling percentage, of larger water terms perhaps flavored energy and

Adam Josephson

lot, Tim. a Thanks

Tim Donahue

Thank you.

Operator

the from of Silke is Kueck-Valdes question final our And JPMorgan. you. line Thank of

Your line is now open.

Silke Kueck-Valdes

size. bring will can on Kueck-Valdes we Bowling back bring bottleneck cans and while for same morning. you like That at good It's Plant, you back the Green a billion plant. the come Jeff around Zekauskas. Bowling up the Hi, it mean could or with Silke -- it think larger When the you to capacity do X.X you're at catering pair online

Tim Donahue

to said some No, in learning take that is I'm say plant and billion It'll back had exceptionally answer capacity. employees, that's back it’s We'll as through good sure, to sized lines in the remarks equipment it'll the throughout not to it billion the time the plant in debug question. bring X.X and well. changeovers prepared with group Bowling learning I up curve Green the properly to on the to employee a came curve produce an as will units a get year. question, or year through X.X the depending size us we The per the I we -- rated that bring earlier proliferation

through we're restart that hopeful well they'll So come also. the

Silke Kueck-Valdes

you. Thank

Tim Donahue

Yunis, call you Well, much. the I concludes Okay. very today. think thank that

you and talk for now. Bye, joining we'll in So everybody to April. us we thank again

Operator

concludes Thank you. conference participating. Thank for that call. all, And today's you

disconnect. now may You

Crown (CCK) 9 Feb 222021 Q4 Earnings call transcript