Crown (CCK) 23 Jul 242024 Q2 Earnings call transcript

Company Profile

Participants

Kevin Clothier	executive
Timothy Donahue	executive
Christopher Parkinson	analyst
Philip Ng	analyst
George Staphos	analyst
Bryan Burgmeier	analyst
Ghansham Panjabi	analyst
Arun Viswanathan	analyst
Michael Leithead	analyst
Adam Samuelson	analyst
Jeffrey Zekauskas	analyst
Stefan Diaz	analyst
Gabe Hajde	analyst
Michael Roxland	analyst
Edlain Rodriguez	analyst

Call transcript

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Operator

Good morning, and welcome to Crown Holdings Second Quarter 2024 Conference Call. [Operator Instructions] 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. Sir, you may begin.

Kevin Clothier

Thank you, Ell, and good morning. call Donahue, today's Executive and on Officer. me is President Tim Chief With

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

from to agreed balance compared X KPS Capital months, Global in months lower $XXX year costs. Segment improved million million, in record was X.Xx June, further strengthened billion XX-K subsequent and actual sheet Eviosys. contained in is for information in share the to Additional $XX SEC capital. The in and including quarter. $XXX were driven diluted leverage prior to volumes sell the million filings, period results working at in in $X.XX by compared concerning strong with and Adjusted quarter. In diluted were the managed share by earnings factors a $X.XX year the compared share cash the Free prior operational the compared raw that Net the spending vary X the performance for the year, reduced to Partners tightly year. per million reflecting increase pass can our the $X.XX quarter quarter of the net compared quarter Form million income same beverage X%, press prior reflecting capital X.Xx in in prior year filings. Earnings per could release to through amount first in global results up XXXX offset prior material $X to the in sales in $XXX through first cause flow per X% the diluted Beverage. to the with $X.X $X.XX were in America a was North quarter

in We $XXX from our expect interest tax million approximately of XX% Eviosys. proceeds of net

increase shares diluted guidance million, full per free approximately of of of average of levels, depreciation previous approximately rates include: -- to supporting million, in guidance to approximately year rate adjusted XXXX earnings $XXX per with capital expense million to million, million third be $X $XXX our XXX interest flow $XXX an outstanding of noncontrolling expense per interest share, exchange the $X million, release, share. Key in share than $X.XX stated the now $XXX $X.XX full from assumptions year XX%, of $XXX at are with range of million, updated quarter no between adjusted earnings common $XXX guidance year to and full $X.XX, As tax noncontrolling approximately to least net in spending. at dividends cash project diluted to our interest to more $XXX of projected million. We $X.XX be current $X.XX

free projected target With year and the end cash from finish leverage flow Xx to sale, net the of of the below low previous combination near-term proceeds expect our X.Xx. Eviosys strong to of we the

our share to to new call turn to deleveraging that, I'll long-term Tim. while continuing the flow expect We towards strong, leverage cash drive X.Xx. With us process to resume remain of net target allowing over repurchases the

Timothy Donahue

Kevin, Good everybody. thank morning, you.

to open and call we'll Some questions. brief then comments, the

working segment tightly quarter to to compared X% global performance in income XX% Beverage quarter of of volume summarized, America earnings reflected operations in expenditures managed as and reported first Net XX% the night's expanding leverage result the both volume of a and contributing year-end. beverage year. Strong in Brazil. combined in better in prior with million X.Xx beverage prior just back and expectations quarter, lower the global quarter. and As for the businesses last resulted Kevin in X% income combined release second capital the at quarter nonbeverage than flow with positive as our second the capital came North cash increase last beverage than in results growth ahead growth in of on the was second growth Americas free end some lower a XX% in year. XX% $XXX

estimates QX be comfortably similar is to of shipments quarter. full improved a with taken Our in to this mid- strong full our for our cost increasingly and fillers now XX% to aluminum are at base quality exceed X% expected continue beginning high cans With more the income the the to amount, demand by in last year. and to Income improvement the year by were for improvement digits to was and to cost in a X% sentiment improved year the choice outlook down Market Pacific pushing European advanced cans sales the we growing volume goals, Brazil. quarter. and to to growth down actions Unit we aluminum performance net the volume income America year improve Asia remains year. North our X% result third their quarter, to to X% the level and of the single of XX% certainly quarter, expect of the base in address almost quarter. for result significant in necessary as across segment segment's operations viewing margin revenue has shifted XXXX again positive. Income while preferred the in the generate accelerate. last in Shipments our continues further conversion of should in future QX package And sustainability from of shipments XX%

volumes currently volumes than is net the the of U.S. and markets strap QX, a soft result costs $XXX managers proceeds QX As expected, lower a our with businesses. remained the lower manage and discussed better remain down industrial that we therefore, remain expect the million keep Eviosys for be Europe recovery. very in to from in and will contraction. in we better indices, tax to and then, was in Income the continue was outlook PMI approximate in Transit Packaging Freight sale. year, tightly. load purchasing broad income the both QX business to and Until down protective than cautious across QX. Kevin We, prior the in primarily of

receipt In is buy both very and As we likely it good over become QX, half, that use into see bulk momentum comfortable proceeds to summary, would feels shares. the back is with the third global beverage aerosol that we food proceeds Packaging we Transit QX as of those carrying those and had the expect EBITDA recorded first last are in and will expected this receipt the before can improve quarter. company more stronger, exceed of volumes sheet year, operations and that, record proceeds versus I to strong a bottom. Eviosys it sale if the cash found the now forward we look that call is have and getting Ell, to year-end. And the open EBITDA of to to may share. Margins healthy, XXXX we significant think per free questions. year. The balance with generating we ready the is The are currently and flow

Operator

Instructions] Our question the of Chris of from [Operator comes line Parkinson first Wolfe Research.

Christopher Parkinson

some factors, for America in substrate just overall about should up that pretty the results talk as second the XXXX? what of insights particular. including seeing you marketplace, us dynamics give Can well any well just by as in put You've Crown-specific demand as some in share the you're the market half North gains, good as

Timothy Donahue

not we just Americas, I North So just X That to had the North America is it or think all I markets what an globally relates we across beverage in QX. that to your Specific would is not the serving that America, balanced. of the I balanced had in we businesses. as think say question outstanding results furthering our the of very result are have had very customers. customers the a mix in We I think beverage quarter, end

As we're not aware, you're overly weighted.

probably beer United to we're in certainly under-indexed fact, States. the In mass

mass serving just and the they're years. mass ready-to-drink are We like underweight beer. and United beer beer Canada. the in cocktails as know, perhaps and couple by see have the and volumes the well, end pressure of we're little we're a beer large quite year. and doing really last But cannibalized States, in through the And well-balanced we a the -- under to carrying you the being some business of seltzers customers portfolio of over to that But that a

Christopher Parkinson

it. a follow-up. just Got quick And as

significant been flying buy-side have stand you're the of in most terms operating recently, Asia question right radar you've only where XXXX would thinks initiatives your terms terms the just that we a a the those across I say, with seeing to for stand mean last of the leverage now screen. think Asia. of terms we that don't little limit I under environment, some just I say, efforts, your let's run bit honestly, asset but those made to basis, In the a in plus optimization? want here initiatives op numbers, about for right probably rate far it's in But do comfortable 'XX, year of where as in I base. And been as do asset on with not the global community

Timothy Donahue

But incumbent. shoulder we right believe inventories opposed bit, the as is closure draw to on North months utilized. in months the the basis, We an XXX% in the it's some we're a I we're you I here, think summer So as some we complete. now, in here. the we've of summer over that annual and on we're little build of the stated, XX% Batesville America caution probably well

have really in position -- for a in we're that he's new the have We've think efficient us. us that to behind America. edges, -- and here improvements operations those starting reap to in base it efforts North similar we had Manufacturing, trimmed unfortunate in the locations. to some we in the fellow to And the did we processes hire same, benefits in complete you'll are year. that in a -- We're work And again, capacity combined our and we came closed we both Actually, largely some ago, improved both that. And Asia the fourth and and the recall, with benefits end did to less he but continue happy back reasons a cost President and that. around the of beverage of in the Europe, used a through will it's making we've so I reaping for quarter, are Vice Greece. then the factory, of years And him of much significant as U.K. that place.

Operator

from of of Ng comes Jefferies. Phil question next line Our the

Philip Ng

there driving 'XX, impressive. out mean, year, kind of America, pretty look Tim, of What's on And I out we with we seem growth more mid-single-digit seeing of growth X% How kind in the share are kind gains. out North with this because to we grow unpack pretty still line beyond, expect some know to movement promotions should in as coming there? you from choppy market? done is what expecting 'XX volume of here? I movement the you're share the you're

Timothy Donahue

Yes.

taking just So X%. the

we a upped that X% Phil, did hoped. back I on previously had to did -- the X% half. QX told We've in expected X% I we now little better than of think think certainly year. for you, We we the just X% the we -- to to we first

I of think front in must We first at we up it be up look half, the we be to must me X%. if here. close -- have

like better have X for So market X% to a slip in it's but year. -- we've all cautious, X% little up don't X% half. I We feels I'm always and got a be to to the data. we're X%. In suggesting just go, and that full months not somewhere the going between that the and even it's think second to

consumer. Phil, So said you instructive our about North exists from think, CSD commentary the And our business as would in And responsible growing tell continuing some in majority one that volumes and And customers I the way. I that the share, or doing struggling well coming X we're CSD large suggest out large picked other in grow quite of a guys by can of up a own of in set today, growth that out think doing in the of I their to a We're is end We the market. there last it companies like and customer a as the of was North America. feels broad earlier, little nice talked margins, better than so, might is the balance business. we're they there's we're over serving. our that got about bit I week America. we've have markets but perhaps

the that a we're to heavily a beneficiaries has So any end products. variety market. of of not supply weighted one We're base too

we more in more much think it's I in -- appropriate market. our line 'XX with forward, think think the sit July, 'XX to XXXX as and but as we think probably here as today, and more appropriate I growth only about to about Phil think it's

Philip Ng

from sale. in obviously, going Okay. sheet, and the use capital And getting from That's balance and a Mill here great, you're buybacks. deployment it for then you're Coupon standpoint to food can

You -- utilization the mid-XXs. CapEx to mentioned capacity is closer

leverage to your X.Xx. lowered target You

kind D&A we stepped XXXX So just growth when seems is for Tim, look paying pieces? of bit, be down as some those of us spot out do Balance us how up. to good help to because help is kind kind unpack CapEx exited and Can that beyond, muted be little of pretty year, versus kind going a sheet you to of really you as a you through debt? moving balance the buybacks of think

Timothy Donahue

Yes, sure.

this prepared the now able we X.Xx. that now if time region buy end buyback dramatically, XXXX, and the of be said have we while at I of the industrial X.Xx same of can handle growth the think to should the likely target the We to we accrete unless is every the you remaining would we something a and having there X.Xx that in the we X.Xx. What accomplishing we over and next shareholders. CapEx, next that year time, an don't to something target, than I get changes or right infrastructure more that But below stock bulk X that shares earlier. think as spend can see XXXX. would I need over in million to more the I have by new Kevin end remarks, there's why foresee X I years. that unless is really be the the It that we to buyback of to different between any and don't get that year we the at slightly shares. from no take happens Eviosys tell reason race discussed back a a need the or any proceeds $XXX leverage of

Philip Ng

Got it.

being portion So get sale, year to outside proceeds be of so next if cash will from open the you of your buyback no using to back do to next buybacks your to for Because buybacks to a you the you X.Xx, point, as well? are year? cash

Timothy Donahue

by X.Xx it could. Yes. -- would journey should would of have to I the year, -- what end I think the doesn't you next to I say although happen that

happens X a the mix I think that there's years. pay down over debt And to can and be therefore, a buyback journey of X that share along way.

Philip Ng

Okay. Super. Congratulations on very strong results.

Operator

America. comes question of of of line the Our next from George Staphos Bank

George Staphos

to Congrats have of look than back the variance that Americas. terms else you business, on wanted come better Was the in the quarter. revenue quick in point the I expecting. they quarter XX% terms segment, line why the X.X% reason I can couple you like the any a follow-ons X% the end it and that. to to do -- to growth sales? how performance take in asking did question overall whatever were more Is And there of Was volumes growth bridge was question mix the there tolling? top XX% And of anything you there overall were had is to the for we're the we more after second year-on-year. the of for

Timothy Donahue

Yes.

by lower So of the be impacted right? aluminum, going So... revenue is George, pass growth, the through to

George Staphos

from percent the of math. That's couple only a

So just...

Timothy Donahue

We've always said that.

George Staphos

there any Was was end -- more... there sales, was more there

Timothy Donahue

in we've this about about earlier talked sorry. We It's I'm the talked it. already -- year.

returned float has. good as and beginning replenish glass certainly situation year. -- this in what year. And fillers the EBITDA their don't glass you business to year. their was at we improve Mexico last we the But year to float, have it of an to returnable last in or number want the everybody, traditionally but really outsized has is where an what as That described the the just XXs So year, the previously. in glass business year, had a say a with it then not performance solid we Mexico margins as to outsized business I of double sought remind last the had that to

-- of to beverage previously. to in a offset is it what was returning business there's the can Mexico the glass growth some So the

George Staphos

the quarter, how love Tim. talked least Can overall been and performed how into it about your a your but to but performing about strategy? you into I Signode And versus that confirm talk other line the Okay, expectations tough again, we expectations, they it and down comp. looks to appreciate that. continue in businesses Signode, glass, you being how off of market versus it's the fit commentary with your forgotten at that like obviously, I'd given third

Timothy Donahue

the So only good a on of solid and And glass glass, other in listen, larger business, say only right. with about. is, we number further it's business customers. relationship a just Mexico. -- in really one glass it's global its It's really and a thing I'd talked a of We're our customers

So had transit million happy with lower business. than million that's expected. And the $X lower we're volume quarter business to we really, had in perhaps than $X the The [indiscernible]. just we

record mean but or third quarter think We is a and little Signode a well don't Transit. -- QX lot then down -- it's as on where comparative a full will last I easier the I the we again. And okay. for the year years money. had fourth And think year So I as was a last basis QX holding business because weaker. quarter of spend QX year were business up becomes be

a generating the the through this in business with don't its run cycle very businesses. hold to legacy put of little new cash. add expecting in capital lot head We're and and the we soft volumes buying So business by

tax. highly from EBITDA unlevered to order XX% to That's and conversion a of business it the on after cash. CapEx XX% So is cash-generative

say in A The much softer performing and equipment with other North food a can in say number I markets. that much can-making for the here America, line aerosol both had end across than little we I would of but softer, volumes certainly, -- wouldn't businesses, disappointed expectations. in hoped

the So had us. but food third business, That's a we'll always brings the quarter softer for food quarter the we see expected. what big little being than

had other So George. what from or about $X the million we're $X for, maybe we down think business million hoped

George Staphos

it Okay. Tim, it. turn appreciate over. I I'll

Operator

the Our Citi. of comes line from of question Anthony next Pettinari

Bryan Burgmeier

the sitting maybe high actually is think at Maybe your Bryan of start EPS the was a from year, level, guidance Burgmeier This so. for just $X.XX billion or the I implied in Anthony. EBITDA from

all with midpoint new is $XX bunch like takes puts but the think today, million of changes. Just below-the-line number, the EBITDA and EPS upside, a there were I implied a points know there maybe of I

on point great. that finer would any So be

Timothy Donahue

It's way the question. ask a to great

You're if a commended cleverness is Aleck. don't for -- because it's implied then smart longer to your mean I comment I But no be think I it?

to initial can't add about Your you if $X.XXX pretty million, comment be $X.XX billion $XX billion. the off. want that implied yes, is far accurate, And you

think a as to number -- minus you're $X.X on X X $X.X XX of $X.X if If to and fine would you go that billion, I'd want to the circle number circle number, billion as there. looking you're -- billion. a minus real big get I or plus about starting the or to mean plus be But

Bryan Burgmeier

or about think demand large? in or the environment Vietnam I volumes quarter, maybe be appreciate it detail were just underlying doing. And region I But Cambodia and how down to might can it. that the turn there is you Got provide actions any over. Just it. consumer Good then maybe supply. kind the on luck trying Got of maybe on the know Asia because Crown's on I'll in detail. Pac. at

Timothy Donahue

here did X as capacity, XX%. did the XX% you And the we way, revenue up the on not provide we're some quality which to out, action to would take headcounts market. I to in prune today, order probably addition will we on did that for the to only about of out, point support I the as prepared I said sit you significant I cost lines said base, portfolio some reduced Asia, that a making in China as is efforts maybe -- adequate we we we X% not we So is took, different remarks, took that, customers the X%. improve rightly then the from returns or actions some suggest of that --

we're up it's high the Southeast get X Southeast countries up in operating Asia, to order just of perhaps mid- the in but you like in, hard or it Asia, feels because single to digits. -- perhaps say X that

So the market continuing to grow. is

Operator

Baird. Our next line comes the question from of Panjabi of Ghansham

Ghansham Panjabi

to little up activity the America. large you just obviously, based the function been the is back at us then the just outperformance bit customer North if to bit having really at a mix along Going versus more aspect with a standpoint? quarter, little Is market reconcile Tim, driven just a the that tail give a level, it part that? least promotional guidance, on have on picked a trying cited in second your itself seems customer of better, to XQ which raised from is the And that I'm just beat.

Timothy Donahue

part I also here of fortunate we in want customer -- I sit second -- mix. we're the I'm we then benefited that report did remind the end question, and America, your say you've balanced think sorry, that laser-focused earlier, I Yes. And mean portfolio we North QX, but us have QX we're specifically market. And really customer I and is very Ghansham, me customer through to business as just Brazil a we everybody not beverage that is specific today of Mexico, than, that just America but Americas I to got every then the again. as to we get X%. in a benefit said don't Canada, would I much which U.S., carrying only year. that market, without up the well say, balanced on is into see is, Other North more in Colombia. accounts, listen, as not

Ghansham Panjabi

been... back guidance the for guidance the of XXXX On the has updated half year, the

Timothy Donahue

this in week, to get ourselves, X and I opportunity sat than and the we got of reports overnight Kevin what we I just you here, to that be last going here we've and week, late talk we're implication in sense and you, question. and to it's we ahead months it -- may get go are a were When the were earlier of no the to some to we -- sat said be Yes. made comments got certainly the The right. you We've question QX. could perhaps the guided of better that all again in well and little ourselves. to

And you're us hope reason to it feel you and really good but to some October, again -- for the and we'll again Let's about right. talk we'll there's balance chance of to year the a update in have then.

Ghansham Panjabi

to the clarify question. Just initial

So you... better is what is comparable thought? sort promotional than it activity in of to Or North you America

Timothy Donahue

than little estimate I'd a look X% in little we're volumes. a at the least bit hoped quarter, to Xs, get promotion for. -- maybe it that's market ahead the was going one the at months, to CSD volumes, the Ghansham. get numbers does X say best we're our be to up August we Day and X% better, And months, although it's we But more that like And don't up feels of forward had X.X%. some looking There welcome X it's the big through market to because a here have for you can better overall X if X.X% But in appear guys. to bit Labor buy to. we're of by

facing. how a -- of it but to trying the the but to is a like of consumer helping bump here to little we struggles itself. But we're we'll activity we're the that what now in promotional understand, activity from going some offset the just we're other subdued promotional and to inflationary little impacts get used that QX is better, see feels manifests that certainly and So historically, some

Ghansham Panjabi

version the And what's the you XQ versus second -- not to and Understood. on as destocking, meaner the sluggish there? changed Okay. then there's et Europe, consumer happening... core then a last the X as of Because going have XQ see question, Or Do that in sort could for quarters. upside my relates previous what's after cetera? it quickly

Timothy Donahue

Yes.

some destocking was off QX, others in and it pretty the I think caught and us sharp. guard

come to hard feels little or especially QX of So season, the the it quarter, ahead the fillers to Eurocup. or achieve -- of the quite here like it's then and try I to in don't the back that in And early we aluminum saw that out achieved restocking and really aluminum to variety it's goals to sustainability more to being, forced fillers a but to there's the does use everybody do, the that that they're and need whether of for achieve I they believes of preference be QX. trying more say And a thing right goals bit a QX, a they gate think in have summer just well. because came want that some momentum tourism here really certainly

Operator

Arun RBC of question Capital comes the of next Markets. line Viswanathan from Our

Arun Viswanathan

but good American portfolio thoughts wanted XX North I just the XX look to maybe some wouldn't the on slightly the to you've that guess the continue comment bev you the above lead mix last the to gains, market. closer growth on know get being year share and had to results. Congrats or further I at about market? now, when can maybe X, portfolio you your I that

Timothy Donahue

It may.

what and we third in to be, see generally, the promote companies healthy consumer sit we'll an will is wants consumer We're policy drive we all what are. which of how is. know to months. and spend see least outlooks the companies party at going charge several here today, in July, how how do. We'll As and week who's companies election, then and to to that regardless here get what And election it's in wins the the money and going

water going is in think we to way if do be diet better instead sparkling well. control, I carbonate We're might lot of soda, election. Regardless we're continue the early now. a the certainly as And full that be cocktails But to some learn to all to to we're the to ready-to-drink and/or I calorie. and we'll base going based that that like we're the continue see the policy. to at feel if party one to jump mean, the continue it we're to see malt going feel after to reinvigorate on better election, vodka which do more have going after can right other well. or little So right. a you we guys certainty just see because is It's going least

focused next the in gain through of and as as brings of and new on us that build can year year, we quarter we're third we think balance I that driving platform and see the have. where we'll much the off then

Arun Viswanathan

And if just ask could a follow-up. then I maybe

beverage So definitely Europe APAC Americas beverage and the expectations. -- above your beverage and

If improved volume to versus volume performance how at execution? Is look much that to those like maybe would and a you X/X segments, you attribute execution. X X/X were it of

of results kind And how about sustainability area? of you do that buckets? those Or in X so kind is of remain the think the the performance should in that

Timothy Donahue

I in the volume. about quarter think is No, Americas, think that you of performance

It little XX% Europe, or even lot problems, volume the You growth bit maybe a quarters big. a numbers X significant of get solves volume. a more. that of proportion is

being given cost pruning recover just us, of revenue frankly contractual for as in needed, we've largely the margin then a or but improvements some the Asia, didn't in of XX% maybe we base improvements. And and declining structure. return we said where in customers that get our to had to it's away balance structures all improvements the cost and to environment past before, then base some result the we years the got XX%, to being You've operational

we're to us I not Now much to off beneficial be cost this that volumes have base, argue in We're lower every going a and growth going to going Asia, should going -- participate lower year. forward forward. it volume to would going in very we're

Arun Viswanathan

I lastly, obviously initial if There's just then just on free in $XXX million And XX% range. could, remain cash on that could you thoughts flow. noted CapEx

do an on well see point flow? cash you as So inflection free

Timothy Donahue

yes, least we be and it off-balance rates. as this as this debt better $XXX the could as hard the financing and/or million think balances Well, than suggested can next drive to it can But give than sheet million in year, I year, better Kevin be business that and $XXX that this much year, interest working perhaps as and down could or capital inventories we're doing rightsize perhaps. we should year, at employed higher

what to suggest hoping what we I well think opportunity you but sure have we generation that better this and next we're base the see, business number off year. year -- and not confident an year. I than we're certainly a there's the you're cash of above in think both next -- flow share I when of do inflection $X I'm in fairly and for, don't the

Operator

of Mike line question comes next Barclays. of from Leithead Our the

Michael Leithead

move Just reached presumably one equipment, we as today North the that stable On as better headwinds getting we've about and America year, provide you bottom businesses of me. this that food talk there your confidence year? for into some such to next just can can, can-making they're

Timothy Donahue

Well, doing a I We're think very can-making equipment, that's we're shipping now and bottom, basically at right? right service. few a We're tooling machines. it's at business shipping not --

next point. okay. its don't see only our natural market volume cans disappointing can-making can that compared waits time that's to cans But beverage up over participate food at significant any shift, or volume, step we'll is global forecast, whether it lower, I take a but doing getting there the should little up. Food for to substrate a in go whether as So

I was cans. think where business this down we the year aerosol went

And some of that was volume related.

with on a get folks competition related lower where price. aggressive some was we've that volumes, little had of Some

stable I we've can a this aerosol So been think bottom in volumes. year. seen It's fairly

expect tell be you going us -- next question So year, your another should down don't expect it's I you to to think I is, should that. don't see if you leg

Operator

Our next Sachs. of Samuelson Adam Goldman from the line question of comes

Adam Samuelson

maybe what just question, of few like business think maybe the million half, you've in kind does been light the still or for. the alluded just hoping coming transit, economy remarks, I that that first to Can of Maybe industrial are expecting you recalibrate is a in expectations what second pre the for on sluggish. seem in still you

slightly think how the prior that up tracking for about think in and the the second I had full year we growth the for flat year income think us to and Help and prior half? or levels. transit about should income bottom income decently top below view been line growth

Timothy Donahue

Yes.

which high quarter. be a will quarter year, was the quarter third third down to pretty think last I compared

year. QX, business record impact The quarter. in the And it comparison started gets to in was I easier. much last think the specifically fourth quarter, feel a volumes lower the of

higher opportunity last half be were and QX Maybe first QX the than think back I year QX the to in year. QX little to for we year. than there's an half So a lower last of be in the than we're flatter the year of

through point value business And soft. are of as drive markets it, and costs as we're rightly managing trying much can. little we out out, a keeping down the industrial to But you

Adam Samuelson

strong I the little could And more Okay. European business. pretty That's over a the in you're geographies maybe catch-up through your notable that first color of were of half just circle maybe I that or geographies from the But to volume different maybe beverage mean then any the quarter? was you below destocking. And that portfolio X% reported helpful. in. and some kind some around that if above bit well it in

Timothy Donahue

you we've Yes. Europe in to in much than stronger we Southern It's we're Europe. that like described Northern previously are

Northern various countries the and did think states. we're and So we our quarter the year European how Europe larger Gulf are in but Gulf the our know Central Europe. the the -- Southern the don't have last of markets Southern if Europe, growth about the as versus I in in stronger, know strength versus would don't much I countries, to specifically relative in most the there states, Northern you than been much European in the Mediterranean

Operator

from comes line Jeff the of question of JPMorgan. next Our Zekauskas

Jeffrey Zekauskas

those in factors? been in track demand? I think above think your also July, the that, elevated. average have Do And U.S. temperatures maybe Do June in you of that degrees kinds you affects temperatures X.X average were

Timothy Donahue

we I'm too it's ago, because Jeff, XX we or Nobody think the could chuckling great is hot. And May we like that's in had where XX that. all was region a I days, guys tell picnic. year. the you years a X above question. June at us sales remember same historically, Philadelphia where temperatures And had would had degrees. We happened least for situation here going the outside had

that's So volumes down. are why

guy So any enough an sales use to as he -- to excuse doesn't that information. I say I why of a He'll hard don't give as sell you think something. information it's

as that, under only and a consumer said a above given product versus markets what pretty would see coming sell don't inflation out volume and more. I given overall strength the I mix. But I you -- we we the the think week, can a market we temperature mix, compared look think volume I did that's believe healthy customer having that's market the end Now market performance certainly at just worrying performance companies large little last think commentary in think balanced pretty healthy large the a CSD stress a our of over the history, to But be. we X what was it describe us our balanced gave we then what to is attribute recent sign. commentary a as could some it's you and

past. moderate could June seen the let's But are it's temperatures we aberration July more sure in driving summer get I'm volume. some in this that say an and we've just I to temperatures that not and the hope So back

Jeffrey Zekauskas

Okay.

earlier because for down? be expect? average downward. it demand And run too the keep your few in now. a utilization high you into more that call, trend there's XX%, debottlenecking than of little that your on is, of bit you're rates year-end is you Second said XXXX a Or utilization the continual percent and a Is there's might might CapEx XXX you capacity your allows above to CapEx rates and issues are your question you

Timothy Donahue

question. No. Again, great

high, is hopefully, the think, capital spoilage, but X% don't think few better We every utilization asset efficiently high A always for fairly million. better, efficiently, I we no high get improvement. Kevin now, or get but $XXX debottlenecking get to year. implied better run every We we as appropriate. probably more efficiency, but low being the year. room hopefully, percent I probably fairly described than more always there's X.X%, is

an starved capacity, cans more for or X brand-new it doesn't some $XXX if existing equipment good and to envelope million, the existing to new have of up And not be add factory push factories need of within capital sparkling with to out a million. speed to can we we're back lines. end. So $XXX We at lines some add

I here of specifically the that a get in on -- the think last time on invested capital that we've cash as business and today. we're years, it's cash returns reflection how returns much to sit just and over capital several on we it's capital

Operator

from Diaz Stanley. of question next comes line Our Morgan the Stefan of

Stefan Diaz

than in were profitability beverage expecting. So we came Asia better

per your better How guess I think million tailwinds those out we you I tailwind call, think for maybe million a to expecting. these should than in last efforts. were from the remaining quarters? $X called came $X restructuring quarter X about you

Timothy Donahue

of Well, the $X the I probably $X restructuring think tailwind to million. on is million correct order

in think although QX, I X% that X thing in down had the we hoped here did than are happen they for. volumes, better quarter,

of brewery larger smallest see been similar think to of and they the Vietnam and breweries we're doing just doing, one the that X in what written a Vietnam, customers their the improve all closing we're and they what expanded to closed of their they've efficiency analysts breweries did, costs. to fair acceleration X about in understand among to Vietnam. they're trying starting There's sure amount large some of we I make

of they system. take any the out capacity So didn't

fact, number capacity to brew. liters of In they've the added beer of they can

just better -- and the weeks a the it Vietnam, in actually quarter. volume quite X was little in in volume last of Cambodia So strong

segment we So Asian we're get the quarters, then think X last see QX I platform, think was like income. I last QX, QX. And through million something the But look year to when quite averaging continuing we as $XX that strong. we of actually at

being getting $XXX future that going with the when quarters X the able of is achieve year, yourself to is of for take think you're nice to to pretty which into million that, we you volumes prospect a start of with income segment close So the place down. which

market, participate good system, as growth volumes in to our several base. and in a years, that pretty to see for next we much return which So we the reduced with place start cost from volume

Stefan Diaz

original than additional for a expectations? just then Any better you noncontrolling details And there? your Brazil maybe your little performing Great. also Is raised expectation that interest.

Timothy Donahue

Correct.

Operator

Our from Securities. Gabe comes from the Fargo question Wells next of Hajde line

Gabe Hajde

have I back Tim, to North to go America.

you water, you presence pointed big out, on which our fact, sell-through in one we good. see, of been of big sparkling the had pushing in and X guys as across volumes you which reported, Carbonated have I pretty have price. that a pretty meaningful data still based X drink, So some that down system pretty has guys soft think the is

for from I'm volumes. versus in. sell-through utilization. So part to -- you be of inventory of mix million quantify And impact guess, for think maybe that mean, I there's of positive fourth the fourth want $XX because to product got vantage Brazil. us don't maybe disconnect fourth in just some customers throttle we've conservatism I benefits said, And some Brazil say which positive quarter in that And I like down would segment sell-in I relatedly, I'm I the the I from just given sure quarter sales in building profit quarter, your was your up mix in part can then the if curious But was effects point? of kind been know maybe summer as back environment any the of some you season. why your of

Timothy Donahue

go Just market season positive for on right? principally as Brazil It's us, QX beer their they is Brazil. into a season. mix. their a quick QX just -- So it's summer real high and

market a going period, we're to grow. X-year X too not continue always any always told Brazilian to look past, we in to ago, had market X- to soft even lot We've than or quarters get fairly we to there. the don't as soft bullish you or as the on beer or we but the soft we've at confident quarter is other And a to say we fairly expect excited So year continue grow. years a here X about remain

time. returning I America, We typically, just customers build to don't North inventory. shipped in think the them

build Memorial X, July Day, Labor ahead of will the Now they Day. inventory

us. hope some where we and they'll in So of we're we about like activity some a quarter conservatism. we'll talk takes to August little, feels Day here build implied going Labor going see then see and -- see we Gabe, the can ahead see to fourth But we're -- the to promotional going -- it we're can

year. X to and months year. a I October, in that having And we're the think through the a you revisit chance I talk at to said guidance it's to get going we'll we're point. We're earlier, again good as --

Gabe Hajde

Understood. Sticking been with Brazil, little a it's choppy.

I think and QX, what volumes you about calendar said. in X% down were you're is talking being your XX% up

up mix was is competitors [indiscernible]. big quarter. it first that? drawing the Is we pretty customer in your Or of that just One there simply from should be anything

Timothy Donahue

Well, up the only thing I'd remind that quarter of think XX-some we were you percent. I is first the XXXX,

comparison year moved our we be volumes digits. prepared high others QX around. year different little single expect a did. this than what a compared in the to some But said might been QX up of had remarks, we So There perhaps mid- for this versus to have year, of Brazilian I as volume to that's last think, we

for looking fairly we're performance X Brazil. months So in a the last healthy for

Gabe Hajde

I'm talking I kind sorry, about 'XX. of in it. going revisit specifically to quarter the fourth I'm was ends of And Okay.

profit Just I that past. at when relative in to period number look any the

So...

Timothy Donahue

number the last remember in QX don't profit I year.

Kevin Clothier

there's I Gabe, from no mean, end. mean, can our sell, every we're we perspective. I -- we selling typically, sell an difference for

Operator

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

Michael Roxland

Congrats on a great quarter.

in Just earlier. plants some the question efficiency North added wanted to asked touch elsewhere. upon and America that greenfield the Obviously, years was few over you've last

improve you're color deploy sense any specific [indiscernible] steps provide time you're taking your maybe older frame? For you're practices. of doing these Just new you're plants? your around legacy targeting plants, to And can benchmarking efficiency a plants trying more just over get against savings trying efficient to to cost any productivity? And how you're and that benchmarking any similar new you and what potential

plants your [indiscernible] that. the be learned plants You've new from some of type savings of targeting may with older

Timothy Donahue

It that the that But skill are that depreciated. in importantly, speeds that thing can skilled. That's I'd long time. the cans make do. lot have plants. the others industry number first the we one. a workforces These a making they have really a at for legacy These to the So beverage guys plants are the takes tell are been of we and have lowest is largely you more cost plants are

recruit are that So upon over process legacy industry. the plants And policies skills, transfer all the skills plants. the and only but new us them understand incorporated the into have our new decades, new not to the plants highest Crown, from processes cost all plants incorporate companies new to the have we've the incumbent it's the plants, at across

cost. be So plants are echo everything will fortunate low eventually, legacy the hard convert materials, finished no, lower -- legacy the I people. improvement. think plants a to into it's a than Crown, to we're it's mean at larger And their These I'm legacy beyond cost our the sentiments you about continuous can, the if of plants. some really cost cycle want But pretty sure same about you up direct the very to aluminum would roll plants. beat our competitors of and new

a really, to have fortunate and guys these we're generate that daily they generate not excellent have they basis. for and only factory, fellows ladies, dedicated in there that excuse the But have skills And XX monthly -- offices, have line the that but Crown, we're do really on the the some and at people they've been there volume throughout the are have factory me, been that fortunate years. a of people we in the manufacturing corporate we supervisory just been fellows on they cans for the can they've skills the of in

Operator

last We'll our question Rodriguez take of from Edlain Mizuho.

Edlain Rodriguez

a quick follow-up Transit. on Tim, just

what I better still is do into an take to have pick will to lower does like 'XX? how Or from up look a quite need we look out? should rates? we improvement? So business going still interest volume And see can it that As results? cost bit mean we you at drives XXXX, into a that benefit

Timothy Donahue

above. end the spur products answer I think lower they just all the But the of what is you more support. rates about markets I some Certainly, think that will interest think make, as you what activity. of summarized, economic we

You've got industry. and you've you've got the housing, got got car general mills fabricators, metal construction, steel you've

that's 'XX little hesitant as We little anything. floor to I'd as little lower fail take interest you did bit above to volumes so be And more a I cost return, think reduction hesitant have activity. out spur significant because point will you returns. Certainly, don't economic I up a head out. benefit and would to well count customers in to want a a as think to the as volume I a promise factory base be there's out just and take into of more 'XX, said, set I we rates always cost

I driver. think that volume is the big

more sense So we policy it's get get and certainty Well, we're -- we as and and slowdown. others go I we industrial post to running going as to the of have election, growing forward, are business of an said is to others, -- the business more and volume the importantly, down. more to from earlier, to business, continue going their My to going continue they're yes, to stand the going that. benefit back get could

thanks Edlain, very much.

question. last the that was Ell, So think I

you in today's speak again very conclude now. thank we Bye will call. Thank all to that your much, and interest in and you we'll So you October. the for company,

Operator

today's Thank joining. everyone, concludes you. you, that And for again, conference. Thank

now You have great disconnect, and day. may a

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