Earnings call transcript Q4 2022

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to Aptar's 2022 Fourth Quarter Conference Call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. Introducing today's conference call is Ms. President Relations Vice Communications. Senior Skafidas, of and Investor Mary Please go ahead.

Mary Skafidas

everyone Hello being and with you. us for thanks Thank today.

Vice Joining me CEO; and Executive and Tanda, Stephan CFO. President on the and call Bob are President Kuhn,

slide accompanying and release press deck been our posted have website. to Our

following on are website, our left. the by right on the and clicking you presentation over and the along screen advance on slide you If can hovering the arrows

replay of As this on always post we will our a also website. call

our we some SEC could now includes Today's today. conference forward-looking to the factors to refer to call I turn to statements. that Stephan. filings call cause differ Please review materially are would results actual to over from like what discussing

Stephan Tanda

call provide today. year-end going about my Mary our also on for by and on our begin and details results I'm highlighting morning the remarks expect CFO Kuhn, call the the you strategic benefits realignment Later and the fourth full appreciate some will year. spend in good the that we the we quarter quarter you early Bob achieve. announced will in and the We December additional time to I Thank on to everyone. results. joining talking us

rhinitis as $X.XX. of nasal adjusted report allergic for per benefit quarter, to the The for in by to from our on are of and as to rinses, Starting emergency X range pharma well and share volume Slide achieved quarter the continue our I’m $X.XX saline that decongestants in which be pleased growth results for fourth core and strong segment, medications. driven demand adjusted earnings fourth share. EPS guided per We to delivered Aptar the X% growth sales of $X.XX

quarter. Beauty dispensing fragrance especially results Solid the in and skincare, volume prestige also drove positive growth in from solutions,

with we rate more ended favorable lower anticipated. also quarter the previously and rate than a We exchange a tax

in benefited that home personal up they the As stock dispensing our working from as experiencing a solutions we over North food, especially areas third our during were care for pandemic. the decline through sales had America, built the identified and pandemic customers are had in quarter call, safety certain

We food beverage homecare were being see to and for are starting sales which affected, shoots. signs are dispensing are a first, while personnel although impacted still stabilize, green seeing few that we solutions,

We received a America's recognitions Newsweek's fourth the Point, we sHero in and of number most largest number Executives by or the China, In the as number have French one where XX companies. footprint, of responsible XXXX one responsible named companies of news World’s the We quarter. us recognized during on single Best Female-Friendly France, us XX Companies And Forbes. for Companies Top as the awards. most the country Le Female a leading ranked magazine

of EcoVadis. in level more XX,XXX recently, recognition the again rating This More top achieved companies platinum is sustainability rated we are from after EcoVadis industries. place across of among than by that all the the efforts our X%

X% with the and the beverage year, sales X% growth core strong up sales achieved beauty pharma growth, and X% delivering core food core for of For Aptar sales while year. were home's XX% and grew

profit worked for sales the the almost make lives and driven that our and do proud deliver the Aptar team our very solutions the core in Growth who needed year We us. hopefully achieving I members pricing. of year the evenly to am year pandemic between world volume people highest of EBITDA single there is ranges. every had better long-term adjusted and sales the to leaving day. was achieve full around more create ended margin tirelessly We recognize work behind

reduce continue to And in costs and the on In China fixed that our to as and is improvement, we we including base our will spending us leverage our well sales. art work new while sites underway, growth. and investments side, enable work France percentage and state Some in capture drive our SG&A of fixed started cost of the cost that margin to wisely. profitable XXXX, our growth capital a reduce of

continue efficiencies in to XXXX increasing will on and We focus beyond.

X Turning through to X. slide

As our is Aptar areas. solutions, component In announced Aptar non-pharma to three four Closures. key us our Beauty expected strategic December and of Aptar January, are complex we reporting multi segments the and of realignment in benefit dispensing Pharma, closures which

aligning strengthens in products. way us our our and and customers our are the it more First, to position closures both closely purchase by market beauty structured

our Secondly, it for closure positions better use markets and us technologies. new to enter

capturing assets. by line fourth by improvements And increases operations. enables capital it efficiencies Thirdly, efficiencies and streamlining common bottom leveraging

realignment to achieve the each and the in ability that the key A done part our complex as work addition, builds transformation our multi focus. work was enhances closures on products from the different require In targets. our learning component a long-term of

years, have more XX last a which its we have and business closures and the doubled Over than food beverage predominantly is grown revenue. our business,

use and like on conversions Cream was from a driving Sour control focus closure also a simple flat solutions capturing flow elastomeric that in the pouch. like a valve added Squeeze value our Daisy to may cap closure hinge Our like the

markets with end and then, capital markets us care closures to end serve directly serve. share the will we in Aligning personal our more market the Since food to much enable one evolved beverage in have and today, markets and And considerably. segment these efficiencies. enhance closures all ourselves common home operational

solutions leverage of complex segment premium and us For personal our the to and and focus beauty in the Aptar brands markets. the and allows beauty, dispensing spray simplification for prestige better care

customers our is equity is providing experiences. Aptar brand exceptional with supply user most focus their beverage consumers to and which to Beauty The small business will continue homecare, that today. food beauty and realignment our will help important to part what spray technologies, of us reinforcing customers, use on a

each across markets. deep leading As of whom realignment, to leaders Hedi including Prieur by of Beauty Aptar their we implement broad Marc fortunate our respective are Aptar businesses. experience leading this Tlili guided and knowledge proven in be we has is Closures is Aptar

on impacted deliver to and shared the the about operational the North our bottom has we benefits challenges past of have ability to have in calls experienced our global supply chain transformation very line. work America. That We much

where have in significant and Europe, Europe delivered not we EBITDA XX% improvement strong inflationary In the in full overcoming has there and been adjusted home for operations showing Beauty improvement of these did and profitability. consistent year, pressures. challenges,

of is and extensive earlier council, initiated detailed cost, the plant respective with we And a a union part As XXXX. which on well week, home process, focus European national levels, Beauty our reduction of works as in of the regarding beauty the X, as in quarter XXXX, continued reorganization and of regional closing of this North the end our completed announced a we December which by in America staffing be will segment. councils the European potential and formal workers consultation quite representatives internally

and will to bargaining processes both and obligations affected take subject country. and European The will in be Pan national timelines each time

the in are early updated. this keep We process of stages and will we you

accelerate also functions streamlining in by Brazil shared service company will the of business United centers expanding business across the States. in-house We the Republic, and the Czech

expect these XXXX XXXX the half of record with efforts. second We onetime in associated and into to costs

our consultations and margins to leveraging well fixed and bargaining base. processes, we is cost our cannot labor our as as pre-empt While improve plans our by managing growth the executing on objective

relatively strength our served has and Aptar well our balance capital On of allocation historically balance sheet slide approach. and X, sheet, economic on and during customers I a comment the which want shareholders challenging our strong conservative maintained to has times.

pharma our recent segment. allocation margin capital years, we have toward majority focusing higher faster the In been growing of our

program expansion injectables million and on-going. began $XXX Our is in XXXX

been has facility in U.S. art The as York in Granville, first Congress, manufacturing A large factory be our additional of premium of our Granville phase New product of France will state expansion in as completed. well capacity new, also based operational XXXX. in the expansions

XXXX, our progressively of $XXX completion. in new expenditures expect to serve scheduled capital In Suzhou, segments to come in all China, that large nearing half a are $XXX online, two of starting to the million In three range we projects XXXX. first of plant will is as our the be

in XXXX. heart sites Beauty the Our in to the manufacturing quarter prestige Oyonnax, scheduled industry, custom of French beauty France open the second the state art of is of in for

older, new will as allocation Dividends of and into our serve plants balanced from share LEED us. The for together part repurchases are manufacturing capital market in strategy. brings five part the leaders modern and certified site operations growing of a one site inefficient also

dividend. In XXXX, shares dividends XXX,XXX we shareholders through to $XX.X for our annual over XXth $XXX returned completed of repurchase paying million increasing and an over We year of million. the

to turn the and slide innovation to want shown on call on as I launches and highlight QX, I recent Bob eight. share further technologies product to over about speak Before details

consumer our or development dismantle container, pump conveniently this or and one recycled a as metal polyethylene the circular be In formed Pharma, by with any needs separate devices pump polypropylene free packaging. in can we growing for parts. nasal serves well in pump, to high businesses. without announced simple delivery nasal a for recently combination sustainability first This the possible When used strengthens expertise approach made recycle spray facing density to the piece the needing

first bottle content technologies of Incorporating which Aptar is part pharma Activ-Vial another in Also postconsumer CSP step solutions. is material now yet ever we towards in launched solutions active PCR active polymer our our circularity. featuring content, recycled

Renpure’s by material Several prestige our For pumps Coty. packaging, pump recycled lipstick recyclable the Europe. in plastic perfume fully feature for we system fragrance fragrance spray Europe made in and including award and both for Clarins’ refillable brands with Shop’s Body new launches hair Beauty L'Oreal the shower hairline and Home, are providing mono JoliRouge dispensing is and Dior, winning wash our

Heinz on U.S. food closure our for featuring Wild along Style is spout Kraft and to line ketchup closures the our with in condiment pour flavors Turning their beverage. custom several

is and featured U.S. in in valve Hyvee addition, flow condiments and cream control In spread Prima closure the brand cheese technology Spain. squeezable, our on

in year customers. in The slide this IDH art marks enterprise we state-of-the hosted lab, to our on of of that In seen offer has Aptar’s also year lab primarily XXXX sessions, first showcases Innovation design, latest science operation engineering wide. the Aptar XXX about Center full As X, InVision France. the material with InVision and past beauty

were sessions, collaborate these level customers Oyonnax of to landmark in InVision engage high outside lab Paris. our we investments and our and with at During between a able the

and and strengthened engagement has has pipeline customer been beauty significantly increased our grown. continuously Our

turn would I Now Bob. like Bob? call the over to to

Bob Kuhn

would I Stephan. XX. you, like on morning to good Starting everyone. slide quarter. the summarize Thank And

as decreased approximately strong due beauty X%. sales beauty, as volume well reported pharma, of X% grew and This in X%. in currency in growth translation sales included Therefore, Our core increases primarily home. price to headwinds

rate As slide share original The facing. earnings neutralize EPS FX increase been $X.XX, adjusted we dollar XX, over XX% to assumptions a which X.XX. the we gave included a of per EPS of assumed the when the range euro quarter EPS U.S. is would tax we end and of we approximately prior year adjusted upper range the X% which are QX. the in of have our we Had shown XX% $X.XX adjusted these reported headwinds to range fourth on materialized, at is currency gave

prior foreign currency We includes the achieved adjusted decreased which fourth headwinds adjusted half in foreign million. of EBITDA headwinds. $XXX and due About decrease these from year’s of of to EBITDA million, $X quarter, was currency the approximately

price job especially Our pressures. we face obtaining of team has done continued cost a good as increases,

At have of on impact. our cumulative XXXX, end the inflation up caught we

to year X.X a on one one is percentage through The margins our continue been on about have points. compressed, margins However, we two basis. costs be because impact passing cumulative for

tax of rate reorganization. was rate for our of Our a legal been for midrange the a tax XX%, reported the reversal would quarter portion related XX%. entity of The XX%. Adjusting tax was including this, guidance have charge fourth our to

by our X%. consumer the of Approximately of divisions. some for quarter, increased details the segment in increased pharma segments to sales volumes, prescription and Turning especially growth core came X% the from healthcare the

due sales division, for and segment prescription demand medicine emergency primarily sales devices. the core at increased in allergic pharma rhinitis, Looking strengthened X% by to

symptoms Consumers Care rinses ailments and increased for and of by Health sales to to COVID-XX. decongestants common Consumer of on including core influenza. turned the also same as alleviate contributed nasal strong to colds more demand some treatments greater saline XX% mobility consumer

for injectables to primarily anti-thrombotic core due the Our volumes for higher X%, and elastomer applications. market solutions sales grew biologics

to prior kits. COVID-XX Turning of decreased core active Active due sales for slow our test quarter sales materials at solutions, the faced film X%. to used material comparison active to a year home science difficult

Excluding materials grew core those active sales, sales X%.

will next a reminder, comparisons persist these challenging quarter. As

enterprise Pharma's resource which included the division implementation adjusted of costs and capacity for start-up XX%, EBITDA system was $X million. expansion, margin injectables planning approximately

growth Europe for China, current adjustments skincare other also and our the customers beauty and America solid growth Latin our on its North off negatively by primarily inventory was core both home Sales X% in sales resurgence offset based had the to Our infections. segments to in increased due affected primarily prestige with working declines in price COVID-XX of Regionally volume volume positive solutions. fragrance quarter. and regions, levels. especially and and were America, reopening due This

XX% EBITDA at and suncare decreased prestige while the sales home to sales by to decreased increased Homecare lower categories. and core the body to continued was categories, the Personal increase. for fragrance and sales primarily due surface laundry margin quarter X% primarily beauty skincare. in This core disinfectant Looking haircare the decreased due in beauty core to increased segment and care sales in due sales segment's adjusted cleaner XX% XX%. care Care market, sales

product sales segment strong faced affected pricing Beverage The core quarter fourth segment's to sales. quarter to comparisons resin Food prices. The declined XXXX prior the compared as difficult lower by also was X% and year's

decreased in through the but continue stabilizing Latin for the inventory and in most customers their beverage solutions. work impacted, food seeing our our to Volumes are levels. the North and of primarily America orders markets some dispensing Demand as of signs America we food was

levels, conditions the affected related to and market, America segment core was were factory segment's Food challenging Beverage in and lower market sales America Beverage offset by sales volumes to North Latin we sales in XX%, flat America. and decreases which due and foodservice Latin the America. our products. lower adjusted volume as primarily Looking with higher margin by resin price EBITDA North food The able were in XX%, decreased and increases at was core primarily tooling production

moment a strong line with top for Aptar the on XXXX, finished and EBITDA. adjusted year Reflecting growth

in will We to continue that also our reduce took costs, steps focus fixed XXXX. a

was exchange the the restructuring year, cover in management and share growth flow to XX per Slides comparable growth million. performance XXXX, due costs. XXXX cash sales from rates. for X%, annual with Free including up lower improvements capital million of adjusted In XX from was cash $XXX operations our of $XXX working earnings and core flow and in X% million $XX

our $XX X For new X and in projects, quarter France large state-of-the-art will in approximately site in all $XXX million expansion year. the China of injectables segments, service in our capital capacity and beauty our we that about projects, million our site the our spent

million in year. $XXX Depreciation X% than Reported capital and As in projects will Stephan XXXX amortization and online a mentioned, to decreased X compared prior our amortization net approximately year. come XXXX. million percentage as X expense large of depreciation less this to sales in or the X% X.X% $X of decreased to

to Moving now summarizes first outlook our XX, quarter. Slide which the for

per to As value industry with covered, solid care and We costs share. quarter of first excluding the of strong fair in the in share, personal expect restructuring to and in expenses, year earnings and equity and anticipate momentum $X.XX range finish a to our continue strong a $X.XX unrealized in the we experienced be adjusted per acquisition the any American investments changes North care food, had destocking even Stephan market. home

new tax start-up is to rollout share for system. about $X.XX $X.XX costs but the of step the and impact The down to in should quarter the the an first will for In quarter XX.X% from range program our rate per $X.XX about we a estimated costs injectables impact ERP have year. anticipate first we start-up per XX.X%. QX, quarter, in expansion The a

year. are currency expecting we the some headwinds to compared prior Additionally,

euro and example, for quarter coming rate a QX assuming the was euro For rate. year is $X.XX, $X.XX first prior guidance the our for the

move full that per roughly to for $X.XX the year. equates that in said rate, for share $X.XX have euro We the roughly every

compared quarter, currency drag at to $X.XX we prior coming approximately the a the are for earnings year. looking on So

$XXX We be amortization for depreciation between to $XXX to XXXX estimate and currently million. million

million. we Stephan in our As to between of $XXX $XXX million expenditures mentioned, expect capital be net government grants XXXX, any and

closing, and In repurchases. the pursue the strong balance strategic continue X.X, ratio sheet with which us leverage opportunities return business, have to in to allows form dividends we in continue value to to of a shareholders of invest to and continue a

shares to In approximately addition approximately $XX shareholders, in dividend to quarter, $XX repurchased XXX,XXX cash our the payments million for we totaled which million.

advance turn before first I you our to time, provide issue move Stephan want Stephan, recast it At call, financials I earnings few Before this to of in Q&A. quarter will we our new a to for closing will that remind we segments. over comments

Stephan Tanda

Thanks a especially consumer and Bob. in XX, In the The the due and challenged as to as first on well to such care. us. be off about care that closing, as Slide America Bob We to skin North opportunities markets, we quarter, is care continue health mentioned, of personal home excited the and ahead pharma end fragrance are will looking we the end good expect ahead care our markets to in as and market in start, year in to our beauty prescription food, momentum destocking. continue anticipate

our see While to beauty our segment early value strengthen fully when leveraging efficiencies of capital We will reinforces say in to the and to assets. these our closure deliver starting allowing will better portfolio to too serve market shareholders. long-term us realignment The recover. customers common orders it's realignment to believe come we are markets back increasing and for food, our position by optimizing segments, and our commitment

growth to mentioned our I continue and for XXXX to focus costs key drive fixed be spending improvements will a This earlier, will As beyond. and while work profitable capital reduce we margin and wisely.

robust value have higher-margin concentrated both X our last businesses our and years. investments and last have in the higher and on number Over built the that pharma we over grown few years, growth have opportunities

support patient devices. offers invested We acquisition Voluntis, and health our capabilities also in algorithms digital which of have through connected

the market this investment give will results be lumpy. a in believe health may still the and evolving distinct us advantage We future. However, digital is

single people used are millions every day. of products by Our

us the innovation recognize product an delivery, customers leader material science active and industries. consumer Our as drug dispensing in

advance in Additionally, of our continue we mission to a leader proactive becoming sustainability.

clear XXXX. growing year advantage full fourth solutions. of and all markets with in unmatched a quarter have businesses that of in very Our very the proud competitive we have I'm accomplished

up for With that, your call the I open would to like questions.

Operator

[Operator Instructions] from open. now Ghansham first Our Baird. line question your Ghansham from comes Panjabi is

Matthew Krueger

good for guess for deeper Matt questions. inventory to a taking across like chain. sitting I'd a little dig Ghansham. Krueger is the into supply Thanks situation morning. in I my This Hi, actually the lot

across basis you levels detail but how an a So some from what on portfolio including your own across the customer inventory segment then seeing can also you on provide base. now, right supply update hearing chain you're on are added the

I of the we've the time market in seen year. first complete, effort be topic destocking mix later line part kind into in quarter be or on of whether a of the think could the be first when thoughts would Any that the lingering for half maybe this it helpful.

Stephan Tanda

Matt. Maybe pharma. Hi off Sure. with start we

health consumer very injectable growth have Clearly, test books with We trend. and well growing at active for the of exception is order see good above materials care rhinitis comparison. robust the in prescription COVID and allergic home

Now volume we're out, just picking come rhinitis more XXXX We that products so part the in levels allergic reached that during see on usage come more product about combination up points Anecdotally, is rhinitis. allergic positive products just COVID. up of out, quite from as catching further nasal of -- is low allergic we rhinitis.

and the, just good or very second inventory build the in one book. next personal has for on are customers that area Narcan medicine month as calendar become consumer the early health we as nasal emergency over very sure, in to for is as is and place see Naloxone care, inventory quarter, sometime we go the a building regimes, order effect. And into hygiene a some different where expect clearly, hygiene The

stock announcement. to indicating -- question as mentioned, think comes inventory I were to from in side, multiple correction in product When home big really got heard is so up then, maybe we wouldn't have need and starting food What service anything. we early people same. the we beverage ordered only a [Indiscernible] your we because customers built great is, it we from days And a suppliers. you mark since normalize. see of lot COVID, XX. our with we've the course, We with as stock, personal weren't much, care, then pretty of The quarter consumer sold during safety care, levels And observed X bit safety our we now hey, that XX

going quarters. down So that coming to we're the over work

with lashes quarter it a producing clearly, working for smoothen by end proactively little those of take maybe that some are to a But at off level quarter X these you people. X and so We have through bit users. of don't into a well we lay will customers certain into to ton

about North I can -- of we reminder, think about America. China Europe lower with XX% And that's XX% is primarily have from the the from North situation dynamics. -- And the U.S. want different our very because sorry. And business, impact nevertheless, be to as I of clear It these issues America best for also say. that. dealt COVID. business a it our and differently has course, us is is doesn't significant. of it But is

Matthew Krueger

from -- costs benefit Great. that then in impact during and the the guidance? could just or lower XXXX of Can talk any material the sort helpful. situation. first on benefit And you there XQ? be raw potential sort material touching raw That's What quarter about very of material raw in quarter saw you of maybe

what resin after maybe We've develops. for about some heading detail on time. oil the up that quite fluctuations thinking recently lower full actually as seen how year ticking And some to and some for then you're with

just portfolio be So would through flow how would that the helpful.

Robert Kuhn

that Sure. question. take I can

nothing but for line, a each had on the positive X% approximately the it quarter, a immaterial segments, consolidated a fourth rather of on had in significant. top So the basis slight and impact

sequentially XXXX. year-on-year be we're comparison in QX to are lower they increasing than of they Europe, slightly but were America from going in still a North actually levels, QX, and where QX In resin seeing much on

because depend and going forecast depending to So a pass-through going there our volume. lot customers, -- it's on it really are the in obviously, impact delays It's on to depends. what is projections the be different the to us difficult for

to expect we're again, largest in lean our for even I So and things like such cost but begin out that. increased is the year, as what we aluminum metal seeing areas -- resin still couldn't would other purchase, and but

Matthew Krueger

turn sense. Thank it, much. Got makes it. very over. Got it I’ll you

Operator

Thank you.

George, Our line from America. Staphos open. next of is question your comes George from Bank

George Staphos

good much. are beauty comment, what X-year Hi, margin My or which you the can recognizing to that. bracket Hope to is Thanks talking everyone that or the so is well. cost question doing benefits a first X-year works of from council, the morning. Thanks the discussions might lot to and for be any details. through there have overall you on employees, the may way one a extent you go -- basis, with to over etcetera, you prevent realignment

that color some you not able there. give might be to Assuming

the quick talk then had about beauty? activity about can bit seeing And a in in percentage on launch much revenues non-beauty of a be Beauty segment terms I of you within what a how follow- Just as will and talk CapEx. you're

Stephan Tanda

Sure.

to ask up. and Let me George kick off, it Bob follow

I to engage realignment European segment Council and want that almost referred cost that independent. work we as the the Works First, to and I the are make separate it clear

bothered very it's it the health they all example, allows to but So a business. are the go one, And it position closures any attractive go as closures are pharma closures And after all won't. million beverage, closures And and users. to the food closures and closures, revenues exclusively closures benefits care and which and after be an health not after of are one us while second really about beauty is go to closure to going just $XXX food people care more business really realignment is be just moving to really, beverage, the almost is The people from business. the end will.

one The second is it. how really buy customers reflecting

assets buying We customers, side. care you feedback have multinational shared customers have because and the from And both common multinational operations, buying already on increased you on have they people they common efficiencies than high-end fragrances also in course, products. even skin cost different of pull get closures then, capital or as good and accounts, side the in won't

do, With momentum pandemic committed at emerge share and our that, as It's line as that we that are the said, That's that look And targets. the easy side, happy on to long-term especially of some cost, we we as from margins. that not good processes. That's fixed are sits we and consultation course, And at. as costs. really we our as to the need simple fixed cost we with get in feel bulk Europe. of not well these top beauty, SG&A to with have on work operational why

versus And our at cost can But improvement we're where of look targets, across operations. EBITDA millions sense tens long-term we your when is SG&A several on fixed and margin our of maybe for Bob, is side that on looking the you comment the breakdown?

Robert Kuhn

Sure.

Beauty There rather, how XX% care call about home the total personal are of Home XX% the and care we that breakup beauty. personal our realignment way and look we care two it was are things So how to they care segment. the customers things. of segments, different personal and consider define to personal care that define But we prior at the

the take $XXX Care about million. So you of closures Home Personal and Stephan mentioned the then piece is out which Care,

I we're So somewhere roughly think, between define home personal probably XX% and would as care and XX%, would care. we

George Staphos

will Should benefits initiatives if to at margin? quantify assume, that you to us expect get juncture you give this than at you Bob. from both point, some Thanks directionally can't we the

Stephan Tanda

-- go One ahead. Sure.

George Staphos

keep can are from nice CapEx these step question my is And Thanks how which where or second related my levels, you down long guys. question just quite a then at -- we've been?

Stephan Tanda

Yes.

X we stream. as comes the with opening executed and the the implementation at facility and in on will of processes related CapEx are coming costs custom are well, large and on share state-of-the-art can onetime kind agreements of labor you we look the the have representatives savings. both Once But towards that mark France fruition. the these line sure. to projects, X beauty on long. second facility of half the So reached which have we China year, in time the with nominally And concurrently We're the really

anymore. within lot the out, never So project makes these levels have more at saying as live big clearly to comes that once CapEx sense not and out. we we will that But means want moment I'm projects large our those take a you

Robert Kuhn

use side. that would of gone plant lead over These that more bit continue going last factories, the the on company, of And should are to sheet But state-of-the-art get several add the less as a facilities that. to little one Yes. to the years, new efficient, just through be in I our I automate of to good a think balance a to we maintenance right, can. where is consolidations to we've example some automate

So have a over out the of years. we always activities run

we've got continue to that the And the like products new some I are which new that some we going. requires technologies, would invest his sustainable said pharma mentioning So pumps in of all was innovative Stephan on that in that to keep CapEx hope stream. type coming certainly

George Staphos

very you much. Thank

Operator

George. you Thank

Our comes from now Morgan Stanley. next is open. question Angel from your Castillo Angel, line

Unidentified Analyst

potential and Hello, on Real any you the more potential in for questions. Diaz actually able to quickly details your tentative Would Angel. thanks sitting taking strategy European [Ph] Works be is line my any on This the on initiatives? for Stefan time Council. give

Stephan Tanda

Stefan. Sure. question, Thanks for the

it's Council. are who you what's if in have For across the legally more country, than and requested you so called interested multiple European operate countries, have if by this, those to Works one

a since have years. that We few

in to have multiple operations case, do the big you that have work any our first Italy. Germany do you counsel. we and consultation restructuring with So France, European In spans countries, that

hundreds pages. you to countries three well councils in And with hundreds are the and to The you affected. is how cover with to, it. need -- this and negotiate books So And have already regulated, have parallel, cover you very works then National you of what need then that and unions.

where unionized different U.S. work dynamics national the local those always different unlike time that's So and Europe, are a not, country. or you it. and of In And -- union. are by and have lines either you at course, council the

reductions. voluntarily to to there for and get this an package course, employees So then implement. that's actually different a look takes it you first why you look done implementation to take time quite then, can for you And you then of need and redeployment some are stages opportunity give of all before

So and you get get thoroughly got you once to end, this very the but process is to you a it the execute. takes time, -- prescribed

Unidentified Analyst

we the Great. way change about would the going capital forward? you to allocation realignment? then the going be should Thanks able some quantify you're of for due incur to realignment the color. And to that And think costs

Stephan Tanda

deployment not of have pooling Clearly, same also that CapEx They some not from lot efficiencies, capital towards but yes, our being you we mid-XXs a much. cost And overall in will over that more see count but create now pharma the by we does the capital ago, XX%. expect really capital five we assets ramped does in realignment by thing, was itself. not change savings years allocation it up do capital And change. certainly guidance. The

Unidentified Analyst

Great. question Thanks XXXX. my for taking good and luck in

Operator

Thank you.

from from line next Dan, open. Dan is Jefferies. comes question your Our Rizzo now

Daniel Rizzo

Good morning question. everyone. taking my Thank for you

was segment, I of the -- And Beauty what years think, EBITDA I in get You Home. where to the or lot we about target talked and Pharma next now in margin over couple just the is? and to? year this wondering over And EBIT a margins, expect

Stephan Tanda

Yes.

for we are at XX% nicely quite clearly, targets EBITDA that external the X% to over guarantee to growing we for. XX% Not margin. quarter, XX% Our there's every growth single time, but that's moment. the and look top line pharma are And what

down million million in which in on it's the are $X And also health, business, then a Now digital to lumpy balance investing drag. mentioned but a $X quarter for lot about $X.XX is million average, we quarter drag. in year. new of the capacity a also a we're created Bob to has business, in our injectable quarter going a putting of $X which one,

look even XX% at with EBITDA that, to XX% margin. the So we

Daniel Rizzo

this of or the most are over investments would assume it I Those year several will be it years? continue. next

Stephan Tanda

phases. is The multiple injectable in investment

we or So the or maybe have you manufacturing chain described. the we process plunger investments back. Two at value the have all three different or call One where the U.S. the we two basically that of one product. I stopper is washing the where the the what the molding France, shield. create needle then let's Injectables, mixing finished then steps. prepare steps three and that just three the finishing And this locations made in step locations, And is And are three creates in in polymer. you is those

making which in in third big also. Congers a one, facility a New two are the next first now York France is the building existing concluded to We've in

increments at So come stream everything with we'll on these be done different XXXX. times, and about in

Daniel Rizzo

All right. Thank much. you very

Operator

Thank you Dan.

from your comes is line Deutsche from open. question Bank. next Our Kyle, Kyle now White

Kyle White

on Thanks top puts side. pharma to wanted question. takes lot a the Dan's regarding there on follow for up pharma. of volume line actually the and morning. the I side, question earlier in taking There's good Hey

that challenging but quantify Narcan You to volumes this? positives moving have there's seem the Is of of right? from expecting benefit comp a any over-the-counter. You you're to lot mentioned be development, the to the there way in a year-over-year, pretty

then even have longer-term, capacity of solutions nasal a then molecules like for there's lot made you And seems developments injectables it being drug also the of and delivery expansion.

of just sight is longer-term, And then to to target the for the all in seem So trying be development? that that given even kind the of to your understand line to hitting positives XX% X% right that XXXX? target

Stephan Tanda

Kyle. it Congers. Thanks discussed Day the we Investor when in Yes. think had We I

moving always business. pipeline a pieces, is You have this and

of the So everything years really start from X pipeline X developing comes today we that out now. to

the growth. XX% pipeline So underpins it's to really confidence our the that in X%

digits. strong at revert Clearly, No right double will going above that. care is growing yes, health to consumer me. are This very now, It's we the at keep growing to back rhinitis allergic be question. will moment. And

with we're raise also comfortable X% XX%, come years quite it. to are to to only we ready this but but the So not year, for

Kyle White

do follow the of just cost kind go means there just -- more second the and of cost you mean, to run the going the of it. to past one-time business that is I any to better this behind pharma implementation? to on what understanding that And then way trying for Got related are And remind costs power ERP costs and when Narcan a those to costs you? Can year away. there get We're up, question those the when be any this you? start-up just incurred size earnings then my was potential, rate you Is normalized side. us

Stephan Tanda

Sure.

four That's think then the or $X.XX mentioned quarter the quarter Again, X numbers. balance go for And down XXXX other putting but the compared it to in it's will away. company, comes X one for on and to quarter was of we're I stream, we capital. small substantial and then which Bob this business, continue one, it's year. will see. some $X a remember XXXX, it also to the I So million, mean, as in as far business, if it will go

business a which our -- metric. So also quite the bought ago. system, standard putting we rent is this effort. XX And now in we're And is all years takes a major SAP

Robert Kuhn

Stephan Yes. you I part. the $X.XX we to had XXXX, ERP in done $X.XX of began on and roughly we start-up we XXXX. gave then in this relating the implementation. the mean validation of then QX $X.XX a total the And the forward-looking to to in expansion that about year, And to related as had $X.XX was

Kyle White

the in year. luck Good good. Sounds

Operator

Thank you, Kyle.

now Wells Our Securities. line next open. question from your from Gabe Fargo is comes Hajde Gabe,

Gabe Hajde

quick maybe what and bit were sounds segments. was of corporate. good just been just start-up ground we than it lot has and to for one a ERP Stephan, It I the that had the Bob A covered, little morning. on distributed one. costs -- one higher one very like looking quick were

there's of then So for you're maybe what anything in just and curious if view for little there expecting bit I'm XXXX? a

Robert Kuhn

good rabbit to drag the Gabe, down always hole. me you're

is the bear of in So corporate the comes kind pension one. from the increase The which rules, -- in me accounting a this have quirk a sit this and of on annuity we side. books, the with the supplemental expense some So biggest of on we asset on our right? U.S., contracts

in asset pension to go while any go through So the have for any OCI. contracts liability fluctuations in P&L through the fluctuations those

So last run $X now rates you had to through the it a positive negative million the as what are it's year is million and flipped increasing. $X had interest as corporate you right, expense,

on even cost there's So that contracts, annuity theory covered. an though they're additional the in

$X the million So that delta. $X.X about of accounts for million,

Gabe Hajde

Or share saying talking organic as my mind least where Did XXXX you're at I of in we sort on some remain we I just absence opportunities today? into perhaps crazy. of you're correctly repurchase. we're those for leverage expect At but side, we'll M&A you were did you X.X, the active chemistry Okay. you in net the something maybe at to saying end see you're clarify comments. that didn't this. pop get about or hear One that

Robert Kuhn

we're mean X comfortable Gabe, at. I where Yes. the think, to times I leverage X we're in

spot nice in. a is X.X be So to

interest follow to about We due XXXX. what's authorization rate with the have at We'll $XXX We are for still repayments left some coming got debt to We've on on M&A. in have million going existing environment. share continue look our that repurchases.

additional rate range we're goes again, So to for necessary. what going was comfortable now, the opportunities see to it going if track stay borrowings that we're that interest we'll in and environment where for And brings.

Stephan Tanda

X usually times X but guide the don't for to at. than the we of where are corridor Yes, ratio the leverage other X.X we is

Gabe Hajde

Good you luck. guys. Thank [Indiscernible] Understood.

Operator

Thank you Gabe.

of your follow-up from question open. is George, America. have Staphos from line Bank a We George now

George Staphos

And information the us that? I give can for taking about you to additional might Can what you the you call. beauty then call in earlier you'll you us the a and assurances that data, be had thanks on been be seeing relatedly, underlying will calls in fragrance. asked the of activity end providing Hi, talk launch giving have we new and the on reclassified getting somewhat to the be kind as get segments. data on segment market the

be activity getting -- So ahead. please we'll that post go launch

Stephan Tanda

follow and then the one Bob up. take me first Let

the of launch year. will our on to fragrances, behalf not market is that So the during business we on but into they new or past launches, the the launch there uncertainties of that's model, look, customers COVID eagerness certainly pent-up had

see comes for certainly that some at and very looks hear see a lot you re-emerges from Americas, stage also and off Europe in good. that in launches exit that China we customers in back strength as back the if continued also comfortable half we second that Now tremendous makes certainly as the consumer a will what with uncertainty, coming period you the of certainly, as quarters. -- this fragrance Even of us

So are the good momentum Bob. launches. in overall, then question, give I'll assurance there And you

Robert Kuhn

Sure.

years need information we've So realignment you with of XXXX X-K give our QX for to done XX-Qs, under realignment then George, prior the the as but that XXXX. year. we'll upcoming of quarterly splits well the you'll not file the and two consistent an should in with end XXXX the the what And past earnings, previous probably requirements the only restated then and at as the for segment XX-K

George Staphos

will you give Right. I was within the beauty reclassified But etcetera, also us guess I saying, food what segments? core growth, core growth,

Robert Kuhn

and you we'll give market. definitely by Yes, color

George Staphos

pharma reasonable of entity on total? sustainability. across imagine us pharma the specifically, then are in one, give within what is percentage any or products be just and recyclable, Last your you composable, And I little, Can Okay. end the very on great. in but which congrats good year year. metrics Thanks this guys, around would the for of and the that the -- company quarter to for end performance the luck quarter

Stephan Tanda

Thanks.

starting this report. as consumer it pharma see product, it's the the much healthcare. with is think where higher as much In is in the I XX%. ratio Clearly, So best consumer-facing sustainability place products where might be you the just our

the also board preference you've or to the our want customers, around in end, course, weight about everything you're we sustainability. whether what above for comes positions And our the talking that really positions, is, and it's very it I I I extremely first to And extremely can around drives from. class of buy Hey, or important thing senior to important therefore, proof we're to But to clearly, seen frontline the in sustainability, the is it's doing for that, who ESG. compete it's people future recruiting. the in when the say, recruit customers, of sustainability, highlight, love talent, company future-proof growing One important important, While recognition and business.

George Staphos

Thanks Stephan.

Operator

Thank you George.

Tanda the remarks. closing back no the I floor Mr. further have on for to We questions now hand will line.

Stephan Tanda

consumer solid team top here all. you consumer ended in strong as of weakness one, We off well users. to the appreciate overcome Thank the Great. as pharma quarter we as everything despite with are a year in Really American weakness the four comps. end done. and the We some quarter North clearly a the will has well

injectable ERP demand be see the transitory, beauty cost As in pharma costs, you we the in know, onetime especially and and continuing. patterns will good

come be and innovation our with first the state-of-the-art the half pharma, China. also should and want Europe to pipeline the back innovation second for see in showcased pipeline. in the half that as in the I to momentum. customers beauty Clearly, commitment China new to We but facilities nicely will strong and is add Congers building center the

our capital online, I just come recognition. expenditures investments the sustainability major our come As will about somewhat down and talked --

year. ahead really to So solid a looking

You Hopefully, to this we have talking noticed uncertainty narrowing that, also may that major we are some of with that behind look And bit. a the you forward is our us. range to road. on

Operator

Thank call. for joining. you. you concludes and gentlemen, Thank Ladies today's this

disconnect now may You lines. your

AptarGroup (ATR) 17 Feb 232022 Q4 Earnings call transcript