BALL - Earnings call transcript Q2 2022

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Operator

Greetings and welcome to the Ball Corporation 2Q 2022 Earnings Call. [Operator Instructions].

As a reminder, this conference is being recorded Thursday, August 4, 2022. I would now like to turn the conference over to Dan Fisher, CEO. Please go ahead.

Daniel Fisher

good and Chris, you, morning, everyone. Thank Ball quarter XXXX is Corporation's conference second company's the regarding results. call This The information provided during this call will contain forward-looking statements. outcomes or or may results may from materially Actual those be expressed implied. differ that

the Some factors in company's company filings XX-K latest news or SEC to in company well differ the other results and as that are outcomes releases. cause could as

earnings of be regarding a of earnings If section found as activities release measures our table diluted website on it is summarizing you release. available financial Notes calculations. reconciliation do not the non-GAAP ball.com. in already the today's Information The have may as also business comparable a other and of share includes our also operating earnings consolidation earnings release, and use per well at

demand And translation NASA industry volumes largely the from images and is partners, metrics, Space Aluminum in Webb the commentary. the increased Telescope. regional Morrison, increased will beverage customers' volatility, actions. then and operating remarks on with Vice President some today earnings inflation, quarter second financial I'll performance finish results American and Ball X.X% driven with by business can volumes aerosol successful comments me initial comparable quarter. we, retail price-over-volume along headwinds amid XX.X%. key Executive North and call Global CFO. ongoing discuss celebrated and our provide and Q&A. introductory closing delivered we stable up the will Scott Scott Joining James

Russia the environment. is operations. invasion also significant the in impact Russian aluminum and initiatives at growth of March, announced to the has We sale returns and by long-term packaging also pursuing investments are world and while suspended is global supply had sustainability a to rephasing Ball costs The where actively capital Russian chains managing support in has it that its shareholders. significant and it innovation, business rebasing future In Ukraine to on meet the company enabling

other earnings consolidation communities. the as beverage we today's long-lived the release housing higher in continues zone and business. supporting sustainable near a humanitarian our efforts business global activities as refugees As previously retail release, highlights beverages X capital for we business during our X of other in about additional each prices rephasing contains and their growth American operations continuing new in facility Russia on the earnings asset the near-term and Note noncash, noted construction volunteer EMEA, packaging. effects aid, in long-term support in impairment aluminum in to local in announced quarter, thank The include: facilities a company North balance for to Russian colleagues Recent activities. recorded war canned new well information the was Peru projects today's for announcing for and versus

to capital cost multiple Our in America and in markets, imbalances business, aluminum and across supply and supply-demand facilities, U.S. North volume coil localized recycling its with including align enabling Paul, also Minnesota focus projects certain American production broaden and announcement while supply to domesticate to the today's and St. Phoenix, aluminum Arizona our chain the cease capability near-term pivoting deceleration North sustainable

operating ongoing million translation Our footprint. of navigating foreign $X X% while operating headwinds, despite its volume, up X.X%, earnings growing across an EMEA geopolitical year-over-year with currency environment volatile

customer, we regional growth. across where countries, X.X% other South that volume managing business, through the America volume deploying due capital strength product the mix, South remains diluting declines to Our to unfavorable are enable American

next-gen for real aluminum introducing and aerosol care global bottles aerosol new aluminum personal categories increasing shipments. team, Our

presence Our aluminum and cups venues. cups team, growing stadiums at our

in value X spacecraft. Texas. the joined First Economic in sector; Fleetmaster, Space drive chain Follow-on design the Lagrange our for Worth, with review Coalition, electric sustainability to trucks front, decarbonization Volvo NOAA Weather encouraging Movers introduce World Fort critical Our aerospace partnership aluminum team, completing on the Forum's collaboration Ball And to a the

forward, are prior businesses contractual and squeeze As on cost calls indicated price/cost looking advance absorbing recovery. our and non-aluminum we in of global experiencing inflationary additional headwinds

the as And and the aluminum in continue strengthen summary, beverage for global quarter. global continues retail our ranging American economic demand escalators We we fastest-growing supply-demand anomalies can win what hard mitigate North team the are additional our X, categories, for SG&A World America, through underlying imbalances strong important efficient. year and Cup corporate that cans beverage July taking commercial is on North XXXX. of and also emphasize a high starting the the in hedging energy It over shelf headwinds and first to responsibility to Incorporating inflationary EMEA, in become to seasonally functions that over are understand hard year-to-date Early renewable recovery, regional to XX%. phase do by half and cost is continue resilient to growth address addressing a the XXXX. things our deliver customers volume fixed cost trends have global the the South America, by costs, demand as all energy efficiency ongoing opportunity shipments, control. second given the packaging and controlling localized operations In term. And team inflation are In indications of customers will price will actively their working this volatility, X% anticipate price near savings customer PPI to fourth range preparing price timing increases based additional will In of also due in on to be despite to during full initiatives. conditions. contractual volume our demand and in should work is for we environment to more

beer, our Our continue in customers are CAGR long-term import American And X% aluminum intact. growth for X% soft drinks drinks, cans. remains to beverage on continuing package like thesis to and grow over energy global their the can new sustainability-driven as to categories cocktails choice. term, ready-to-drink lean the long Carbonated also North cans of and growth

the are we control. controlling can things We

In chains We investments supply with And through and addition, support high for delivering level, appreciate are ask long-term turn your and done the actions. as executing contracts. cost at focused high-quality structure, across being work enabling necessary it to navigate rebasing I'll that, we alliances we and global on a the organization the cans in Scott. over

Scott Morrison

Thanks, Dan.

quarter share diluted in $X.XX were Second comparable earnings XXXX XXXX. per versus $X.XX

included $X.XX quarter unfavorable XXXX Second impact earnings translation. of

comparable and pass-through share strong price/mix results higher by quarter share second were completed and higher declines and effective lower higher Ball's In flexibility. America, XXXX. expense, credit America a maturing EMEA, up earnings in currency North by remains improved unfavorable ample prices, in higher healthy the operating with company per liquidity beverage diluted and tax interest and in offset offset other balance translation. sheet to Comparable due volumes Second facilities the June, reflects of new performance, and count, aerospace rate with partially earnings earnings translation. sales aluminum quarter South comparable aerospace higher very metal

today operating As we XXXX, to of of key and here rest some metrics additional for the sit keep key Russia mind. inclusive in

earnings to XXXX buybacks the our year our shareholders the XX%. And flow. use We EVA about nonreportable shareholders. with of from business, of below year approximately higher partner now be to effectively fellow XXXX I'll and, available be range the and pull assured, and capital be accelerated to Our billion earlier be and trip. Russia cash we meaningfully to interest to full comparable $X undistributed the higher chain questions and CapEx At in form $XXX you, now the the chain, is owners. With expected stewards to dividends down in lower-than-anticipated in tax to earnings XXXX in of expense innovation led beyond expand answer will full effectively, $XXX through for deceleration given million. the back time, announcements returns the good addressing to returning necessary, lens comparable a capital investor operating of business and levels and Rest look at our effective we range our this in is of and $X.X that, levels, exiting when manage as current expect the to net supply turn and and our We outcome supply Ball to why customers in million. of impact the Ball will decisions, be cash best CapEx discipline, levels. other to to of returns volume range expected year our billion plans share grow plant field debt enable and increase in will Full have levers anticipate be it XXXX. and to Year-end total is of secure other forward September of Dan. working in corporate be in EBITDA costs rate range XXXX The expected on recorded

Daniel Fisher

Scott. Thanks,

Drive approach, we rewarded, know our through capital part XX going, capital showcase important. honoring has our to costs, be By planet. plan aerospace are, will to an serve and and guide. address and where know providing discipline to solutions allocation will companies is And we vision packaging our our in our actionable shareholders and business, through disciplined improve will doing returns. know the we're for uncertain Great and what Our we resiliency times. economic the continue company as who We our our be we intelligence actionable sustainable aluminum preserve businesses

XX% earnings of diluted in growth headwinds, good pending goal has to inflation business, and been shape the ability deceleration the impeded and XX% achieve EVA our and flow in per ongoing recent XXXX growth, earnings, our trajectories While Russian in very for our of beyond. XXXX to cash are long-term by share earnings translation volume our sale

in our meet are where Russia to it's the world We sale today. business at for rebasing preparation structure the and cost

deployed on and packaging global technologies on further increasing to and and growth returns continue our the We aluminum aerospace across capital portfolio. enable focus to

discussing look returning stakeholders packages XXXX well and to our beyond that, positioned more serve our that continuing forward We bench uniquely technologies. today. Day. highlighting in suppliers, are to to shift decadal questions. Ball shareholders. favor We journey Chris, for And wishes we're ready our and customers, aerospace Investor to our with and We by extend September and about our We long-term to global plans management our value now listening everyone will at forward employees, growth look our the

Operator

the And is first from line Baird. Instructions]. [Operator Ghansham of question Panjabi with the

Ghansham Panjabi

bit how a categories on with cessation this Arizona called which idling If us of just And more you long? in of approaching you off America. Is particular production we are Minnesota? color maybe starting just Where in terms so, Maybe give showed in of and capacity? are out then that that? how terms deceleration? in Dan, the North temporary

Daniel Fisher

Sure.

flat penchant drinks, hard seltzer, the beer ready-to-drink nearly was driven by mostly import up category drinks X%, was I'm up, for digits, of The was energy a grew. cocktails So taking the down second start water, F&B more was that's a CSD, down single energy down. a quarter. Alcohol, up sparkling resilient. first Total up volume. double relative up customers' X%. to surprise obviously, versus off domestic CSD, with digits; given X%; non-alcohol XX%, up down craft I'll X%; XX%; not bit base. to and Non-alcohol price X%; in and low impacts craft, Import question to total you beer was XX%; beer. our beer alcohol, up in was down XX%; was was sure lower particular,

those Ghansham, basically with flat X mind, very earnings shuttered, were well. that facilities late consistent that we releases and customers' it's as keep the Relative net-net-net, please to announced can last in night. So penetration, closures for our

facilities. believe, it's reline These in mid-XXs. right our think built These into net sensitive all are in both And that. facilities, step the of These permanent are billion we'll one despite X% a deliver the so X% employees. challenges one facilities. units, number Relative capacity X% to and approaching to is our that this They X raw, growth we built shutterings. for XXXX, The year, the ability economic landlocked was now to growth. was then are so again, very very about removing

place in of facilities start-up. and to continue plans have in their efficiencies increase that We terms

that's growth from should refer savings, a this that our the would into is is our fixed and you this. interpreting it we over I'll we'll goals, relative medium and able that and our cost optimizing like in just something be So to Maybe history to And step consistently done give in times long term. to this. to context both how and projections turn to footprint, just throughout we've some which back around be typically Scott step

Scott Morrison

Sure.

cost going a of I'm clarify, these the not X% that we've That to Dan to Just about was when region. particular cost referring or But this in he said growth, closed wasn't out historically, think $XX any year. facilities global about was each come early particular of this talk fixed we when to. number of one as that size, those, next million will year one probably lines, facility close later for fixed roughly and X X facilities.

Ghansham Panjabi

helpful. Okay. That's this And for on X%, the as region, comments at down it that you point? does outlook how break then way volume full relates very it to year, the by see the the

Daniel Fisher

weekend, You were Ghansham. there same what's and to pricing going a anticipate We're markets. range that line be a North Difficult there parse I And X% I was now, to customers. America Europe now, incredibly behaviors on those to times within you, confident out feel right America, the to America. going been in to just the half South seeing on ago. there on with customer candid pricing trajectory is last We our trying in just can America, over dependent be volatile from specifics right over South keep has the quarter growth week times, globally. resilient. appreciate and behaviors out to very quarter-to-quarter second multiple X% with pulse commentary -- in in pricing play we'll with just our been ongoing to North be

Ghansham Panjabi

Okay.

to a far, Dan. tracking negative, North in follow-up XQ? thus that, as Just America Is

Daniel Fisher

through No, increase flat to slight July.

Operator

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

Adam Samuelson

XX% in to prior XXXX I guess want off So And on narrow not or going this year? of -- are about -- period. earnings to growth in XX% just by against calibrated where us very below comments target, the of And headwinds in of of any you'd XX% be to to XXXX trying where a kind if on release path off way I'm any looking press lower that That's about there's where that's we some help be XXXX, to be XX% to long-term clear, buckets think through of being I helpful. key return be just CAGR of the growth previously earnings the sort to a year, that, kind the base. would a the actually to to would halfway kind earnings any region bigger is

Scott Morrison

is America softer the pricing strategies South I initially customer kind This mean, business what inflation in have our doing Sure. in versus be earnings what the I the timing given sale earnings in going tough we had year's that of to as think like in been, given it's total, the loss around see America, translation, XXXX. thought, well the as operating Scott. and to mix North is outlook I customers' Russia what last given of we comparable world, think of euro our match and

that about So off kind the comment year of base. next is

Adam Samuelson

to be customer of the to the kind about to say that you And from would that or ago. helpful. the Okay. is maybe plans, I to kind you're X% it X% more long -- this that That's very have skewed that's kind X% still than of might prior And all. of how talk I year, kind heavily volume over to X% composition towards mean, what North think be fair America guess, -- medium taking, of changed months growth seeing XX especially if and international volume just thought of guess you're perspective it longer-term growth, market you any markets that to on But XX term at a considerably might kind in growth. get I regional term, then, about you of optimism relative actions

Daniel Fisher

Yes.

that's fair. think I

North first quarter be would price growth have market. costs, holds over year customers America the which And we Much relative that pricing off we our implored inflationary come long a implied said, for tenets the digits, customers. we from of clearly decisions now, on in that. to to still thinking strategy, underlying double decades. margining what and excess our to second given Right every that we've the return pushing to the clear, semblance they've entered I that of they're in term and and they're and the the X% relative of to growth, trajectory the forth X% grown and to we think, pricing need of medium and

return investing a business. in in a that there's volume that from We've if benefit pricing will to So had Europe terms we modicum an to different resilient of a We're uptick in North grow. America. continues strategy, business that of in

in region well other world. the a entered advance to that turning into in America markets. of the tide be They the of South recession seem

some the tailwinds into certainly America quarter. stepping of discussion into early And hopefully, out that. of the coming will pricing 'XX, seeing a it's We're -- fourth and in growth, in first So of we Europe. signs see benefits North quarter

on, our substrate several energy we've to us the said, customers the from is, we're the it's that gas happen matter been if, when. fact aluminum I concerned We're investment, about of underpinnings lot and times. pipeline of push with part and world, as what's that continue both going a hearing, in business to over belief of that of there what penetration But coupled As flows. our customers, every going relative cans not it's gives with to a natural what's

Operator

the of Our Parkinson from Mizuho. Christopher with next is line question

Christopher Parkinson

out just How of mentioned off should drinks, the say, what's 'XX, You let's first this ago, did thinking North specifically kind bridging alcoholic, intermediate-term basis. views half can versus, be right about the America? just but we You a now RTD happening minute here energy a nonalcoholic of you of perhaps break for substrates? lower right your

Daniel Fisher

numbers our pricing these because a beginning to have comment on difficult to strategy. 'XX impact Very customer on bridge a the of direct

and are taken have north price, flat. XX% their volumes customers year-over-year Our of

take will numbers less these in go I'll a and to again. volume, interest of were as moderate all be the backdrop, that if back more So improved. That price categories over to

it double The down total down craft, sparkling X%; nonalcoholic down XX%; up CSD, F&B, very import water For X%; categories category, was -- X%; drinks, of base. up X%; a off XX% X%; slightly hard X%; and digits; alcohol up beer, down cocktails, slightly, small and beer, down energy ready-to-drink they nearly nearly XX%; X%. was domestic seltzers, were grew

pricing customers. the will that it what refer and behavior, commentary. to the translates comments relative drive industry in customer which most for total, that the into consumer in will on How year, of to the drive second that in volume, the just nets So -- X growth my interested out quarter. end half That we're to our is back is

Christopher Parkinson

Understood. quarter. And first choppiness on some optimism fourth World just a the Latin follow-up quick Brazil. some bit. It it's the and abating year. in America, Obviously, in the seems like specifically, for quarter this little quarter, a Cup fourth There's there's

Just what -- about that think how confidence we the boost right kind hearing of on should alcoholic category? you're right year-end towards and bridge that in based now in here, that your

Daniel Fisher

year-over-year America. QX. saw, nearly South with market. XX% early the of saw QX in Thank line earlier to you power in down to quarter, XX% double-digit our revert you. a QX volume, QX was mentioned, third we -- in purchasing can of down I XX% as to us were period. flat in for and return commentary was back to up We from prior That hectoliter a modicum What and returning QX, end growth us consumer we're expectations. the publicly, significantly. end our from And consumers In parts QX in was that and

an and make our As does line into you volatile, a not but both with quarter, winter World mentioned, is. world stimulus Cup it's heading in quarter. in Brazil One election, the in incredibly anticipation further the falling month a

Operator

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

George Staphos

facility in customers there. and going understand, not? to should or you extent the Dan, have there the what of Vegas facilities need was us Will to if help background you your possible, from to what other North could supplied are been and kind plans Las by on the that supply that

Daniel Fisher

is The answer at no this point.

put X-month had with will a this we customers. impediment right the pause. those just the phasing engineer. X- have can rephasing. We can labor. We we to there, with anchor We lines in. conversations would hire Think We've the now a -- could as be The tenants put speed the about which

It's going absolutely rebasing and happen. is this of to just the So timing. rephasing

George Staphos

at this times Okay. I want another question it. And a has and of with to up couple analysts, my come then peer take try

rate still growth long-term So a X% the guiding can. you're to X% to for

it's of juncture, we And You customers to you by from speak for do. this and driven this might exactly difficult mentioned are promotional it at the growth very the obviously understand know is like what can't be customers. what or the look strategy part determine will what to because the going year

confidence, X% a in a it how across So X% and what regions? if confidence, there's can how at you with backdrop, gives have to that you the all, quantify might as vary to way the

Daniel Fisher

difficult we I've be unstable that out the I never year. probably George, A be digits macroeconomic for a much the we'll like we believe on in as and reaffirm, to. parse the a right have It'd Yes. environment tell regions. inflationary a the yourself, to other couple basis, things will global one to And range. mid-single you, growing I'll at seen point an we're environment, geopolitical, now, as growing

in We our with customers. contact are constant

there investments XX filling with have been And days. rolling mill we're -- X suppliers are contact our announced We and in of the multibillion last equipment. constant in

a conversations. So to right budget regional parsing be now. relative a entering discuss Day. bit dynamics, our of clearer at XXXX We'll the that have picture difficult out our We'll to Investor

out underpinning have ongoing will in other But I road us a be stay basis of All the talking world to firm of an and to to close customers parts on the get different that years thesis of on to we story sustainability holds. belief couple that that outlined allow the to growth in a It ago. the the that will still variables drive circularity story and us this.

Scott Morrison

we the think how seen the going to think benefits given the package. a has bias about recency XX I everybody and happen the what have world the bit nothing a think the changed you -- of last I sustainability volatile in about if what's everybody forward?" can is, attractiveness George, has of kind of Nothing "Okay, of -- has changed and going long-term days to say,

we And our we're with so customers the various filling XXX were of having plan Europe couple Europe years. customers, over a across in -- there's a and lines weeks at our the next ago, several conversations for

at some They're standpoint So the as things term, short are a North from doing this to that proposition. win. can in a long-term term are America. looking is the the to long in going customers that helpful disruptive, continue are volume But not

think kind that XXXX, And and of we it's back said to that bit, we so in we we're X% -- Then we a growth said got excited to Investor to -- X%. moderating growth. now the X% Day, X% but when still accelerated, at it's

takes that's think I got none we benefits changed. things in of back looks of because And can, step so And do if the all forward, the near and term everybody the we've a where to focus, localized our need we're to some that frankly, costs got that. ahead SG&A on they to we've we And to supply-demand have be. do imbalances going probably fix of that have to -- have gotten

really things results on when to going we're to the position spending a that be. And when department we to we department that in we're so to us going need do and be happen, going lot. by that this what put things And the like escalators inflation we in combination our and moderates a contracts get out of contractually that's money figuring need don't and through what

George Staphos

that. one great last my is segue. Scott, appreciate I a Sure. And

view and What view, your to take also XX-, the reduced input of us terms longer-term to to as $X you backdrop a return help billion relative you given how that? a that last, in from Can value dropping XX-day your consideration bridge were there? So get $X.XX target with a billion. whatever, you

Scott Morrison

we're Well, sure. be when of going a about we use originally less Yes, going to make than $XXX into to use million. thought to the there's we working -- going year. what George. capital, Thanks, money We're came

America didn't in building our in look If what here that second would the inventories, for quarter, be show we we season up. a North more robust thought you inventories were

to $XXX So we're to back yield focus use capital of the early going us. still range a We're on of our know that we're Russia going will too business the in have of what take to the half in but the the working year, of still sale in have process to million.

contract So we're got their a that in isn't paying issue around being customer cautious -- And defaulted customer South the who front. that we've us. then America on

us those for all to has in term, not long right the on me, return share all. focus -- things value of But at kind So reel that lead now. our the the changed trust in

ramp when put capital because that's meaningful in back to to look slowly a next be and growth year. we of We be so of And a capital see to at reduction for time, it a it can of we more dial the able period in up over return position longer value shareholders.

Operator

Pettinari with Our next of Citi. question is from Anthony line the

Anthony Pettinari

essentially sold we I just of from maybe out where market were the cans a North sits Could We're directionally, there the running number where rates years your understand be talk the wondering, how completed. to you full was system may just importing want still American America exiting about American and if I'm all North coming where to over world. closures slack you Will these sits market? American back or be off North could be North out? the think in year. operating you once are some

Daniel Fisher

happening, bases: And a up we've last there capacity made near simply asset Glendale. is, Pittston, that the ramping we're near-term confluence are There's couple further for term, this which be investments flat short-term is and because Yes. events large over Thank the could line you. of answer, years. or a of

improving of the really those nicely. lines So are of efficiencies all

volume number. higher a anticipating were they So

over last long to but that took term, it's that We've yesterday. the are to relative Strong the leadership there's see assured, in wait think view to think an I the We've next have meet need a we optimize to network. decade. the now, decisions medium months, to and we to So a the in rest we consistently We position. the supply-demand. where understand. the done right X belief I But X taken dynamics those world at exactly industry

Anthony Pettinari

mean, are your Okay. as inflation follow-up Or That's share environment? that current doesn't tougher walking North Or seeing the things? the you business very some situation I'm you to I with of wondering And America helpful. those from and that, solely what in a away just lower there. meet volumes is X customers just that are thresholds? then some is maybe strategies combination can it promotional

Daniel Fisher

we've Well, walked have return. don't walking we're away we if EVA historically an not mean, I away. always

is are in volume And we So This are a not price impacted X customers recency bias. by -- volume the our XXX% that's growth. advance up that's putting zero. but of is their and inflation,

Scott Morrison

Anthony, terms new those we entered into I we'll a that into contracts 'XX. the the we in benefits get we've would just lot. contracts start economics add, And as to customers, of those see like on recently some

Operator

Our of next with from line Mike is Leithead question Barclays. the

Michael Leithead

I the America. all especially North detail, category, in by appreciate

can to be sale First, you is provide Russia the of divestment? you on year's clear, 'XX? this commentary there or about just an you when update EPS, any Scott, gave within some earlier Russia of sort answer And are fiscal assuming

Scott Morrison

end. robust -- continues we'll and currently, I of where earnings, on and But Russia The the for get numbers those process the in direction we year. inclusive not -- have a to and it EPS. Well, we to comparable on progress, pretty gave one, see going process No. was full

process September in time where that's and So that. can now. we're kind we of what's when what all the in more and we'll Hopefully, tell at get to our I happening later to frame right and of information Investor as you Day have

Michael Leithead

X announcements night for past North just 'XX where big America. lot delayed second, last appreciate North America I like seriously. between But thinking from kind that. just X quite take a different to feels or are little deviation past -- go even appreciate But plant, it different I the and -- X% you months. these we're the mean, a to new I customer decisions mentioned, bit wanted And behaviors a of all Great. plant pretty X% and you about market. And the I as of the or back

shrinking of is your with there I'm I bit a swells, conversations confidence customers? plans your bit. are trying it to square your guess, quite growth So mean, kind say medium-term the to changing a just I fair

Daniel Fisher

Yes.

hasn't last So months. on one each our taken average, the X increases. customers just quarter last The aggregate, clarification. have over X% We've in had, price quarters, happened up, pricing X over the behavior

is increases to That now impact and getting XX%, XX% that, So has system. in plants, this. XXXX, was you optimizing almost these near-term I'll buying. for at consumer balance price absolutely And in where, a of across looking was in you're our products. built point X This at optimized an We've discretionary remind making We're you're that XXXX. X adjustments. we're footprint. at the We're on X our constantly year-over-year, a these and efficiencies built looking some looking us. we're

we've give should we customers. over year terms some behavior of thought terms last that do So need the what the pricing what relative seen our from to you to in of in

Operator

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

Arun Viswanathan

just So yes, the into I outlook further wanted demand here. I down to, drill guess,

any data year have into range. going normalizing all new still What's You a into there. seen drive So gone period kind either we've down more we've obviously, XX%, a next like to maybe historical else, growth and out amount Or anything into to the growth. water as take slightly were back been or the we're reaccelerate looks far growth as of would It of we look pickup going accelerate seeing to it higher seltzers cans? in that as so? noted are that of through or or you rate growth? a But robust very any potentially of beverages trends, the

Daniel Fisher

you. Thank Yes.

just major one clarification. So point of

'XX. growth multiple this times X% historical call this X% think, year. were X% We to years Our communicated, believe at I that we into in we'll just grow heading XX rates for

the growth. X growth is our and with rate what line Xx historical in for long-term thesis investment So we're to

As it base. growth We're seeing to to relates We're rates. at grow growing categories seeing at and drinks absolutely. energy innovation, cocktails high continuing a small off of single-digit XX% ready-to-drink

over If X- quarters, calls digestion X-month business doesn't period. have you back to our several refer the move It to moves last multiple times, I over quarter-to-quarter. said

they activity rebase So out start things cocktails, push things, of that shelf seeing retail decline. as modicums around filling will those fill retail they space, to like the sales happen, promotional are areas locations, to RTD and

increases growth. a to seen CSD, on shift. we've slight drinks areas, to very it's bullish a price And ready-to-drink so flat substrate energy cocktails. percent the plastic-to-aluminum in that bullish I'm yes, XX-plus resilient despite continuing. is I'm And those on very still

give will what historical appreciable growth an terms So norms an all those seeing of rate things of comfort that higher extended continue for we're me versus in differentiated, maintain and of period time.

Arun Viswanathan

bit -- are older a base. of that on production potentially end that Okay. rest relative to of facilities higher the your understand your and curve cost you're And little I shuttering so the then the

out CapEx you've return, capital should I can still I are I about lay CapEx other projects maybe that, we your you return capital there you up? on? over levers how on if So growth you're back next obviously, guess, to moderated pull But about So that could the from capital get track. know on think but know potentially the are several here years. thinking how

Scott Morrison

Yes, for back we ground. are in the Yes. essentially things half the paying the year this in that expect -- mentioned that I year things are we're the of that

on good, pretty have favorable capital. We of payable terms most the

that's lot a change -- ago. going I of million it down can't we heck X we taken why from thought year. months $XXX It's about to a we've So be this think what it

would XXXX expect, $X.X it's we'll as at and we like I -- So you. billion. update look

mid-single moderated, year. it's down the would that in would we'll But just has we we'll next number but doing people hit digits, our better not come that thought expect because I to the the our over mentioned, you the some Investor Day. and Dan it's As here double this to XXXX, months, capital of able still growth give be couple but in at a planning digits meaningfully be

capital, and return back to more So that we're that opportunity dial gives shareholders. us to able value to

Operator

of next Our Castillo Stanley. the Angel is Morgan from with question line

Angel Castillo

just -- maybe be assume think wanted where guess, kind that more sourced we're to you just sense laid appreciate I within bit any more Dan, roughly in I reduction, into Day, North I So or but that coming to, might might you've going out at details get Investor where that, America as the CapEx dig of be for I that from. XXXX. a from? guess, about I plans reduction the little future

Daniel Fisher

Yes, Thank this on call. been focus volume on of an there's Sure. awful lot you.

we I to the of is coming year. to of what in mind, you ago, if That reflect get in hell sort is there's a going number we us think inflation. Scott's back anticipated into year. a inflation to to this XX, relative been on on That higher next that keep earnings come lot XX comments anticipated than days downturn of headwinds

reflective should improved mind, of arrears. PPI year America an mechanism. Europe inflation and Keep in be earnings both a in in through pass So we North

we specific, a So But to guy. we that good stuff comments, And see I pricing The there. that should has into we the customer continue our as will that over over and capital now reflecting to year relative stewards strategy. more there. bring And further month the if then we're we're there's the be, for a document Scott, as we to rephasing anything of But more specificity that paying been going missed number now. sit other of do today, ground, good capital next capital. our we homework And then if will to be turn that here Scott. from and that I'll and some

Scott Morrison

-- business -- just aerosol grow. Well, we're our I to continues

grow. Our aerospace to continues business

yesterday European of years We be going our of we're we the our another in liking we I colleagues. to And to were all -- built We we're capital. do the ago. Peru. both a just on -- projects Paraguay scrutinizing we're some results that, and to plant plant going think progressing of of that We're have. couple really on we're with a call need

be slowed better. at moderate it's pace, the a more stopped. growth like frankly, So has not It's and definitely down, which will

our overall looking every business. part and at of costs capital And so we're the

Angel Castillo

about to longer helpful. think I very a kind I mention maybe then term, medium was a the then was a were with. as things customer the you couple to we maybe of that and And One maybe dealing front, on mentioned. of wanted of of That's kind we think revisit inventories there default

share can year. others might again, inventory can with to growth, anything cetera? just next that specific or, that anything to give of kind those think kind about returning to should So back year next onetime recover this XXXX think the as and of and industry at market of what growth growth kind you we point items of then that Ball kind And to these we of of year else be from comfort that back and more some levels, or get are maybe look or maybe should you and of X we outside you back, to as et with returning

Scott Morrison

not I the mean back want we never years, and been summer, ones. the your your are to big inventory, to get service season. Because you're -- the are you those summer I've XX Those are that until to sales No. scale if production for you the customers ready around in lost.

seen. robust the So of inventory for growth what we've more than expecting we first built year the half

down time ever to got be half default, that first So contract. more that complete now we years, little bring that legal I've more inventory and year XX a focused I've been here the has with for that's a customer to seen the the that not a on reasonable the to have we've chosen of customer back levels. And contract

a So one-off. of I a bit that's think

big the less than thought are make are we're and going those changing, So to total. things we in that money

cautious XXXX nicely So all ourselves those about shareholders the setting things. that's think near of why up of we're return the but to in really improve we value having be to term, we're to for

Operator

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

Michael Roxland

little to Wanted dig into America. just further a take a North

great we a comment, the You -- appreciate it. way. of lot by I provided

XQ, a in X I terms in the of capacity to it you You guys good amount Glendale, mentioned a fair in you or up mentioned that like somewhat XXXX in to overestimated X region -- relative comment of with in guiding think, America have know of southwest growth be -- was that in it mid-single growth that XQ your to region one you I America Would fair growth of Dan, volume demand? of peers X think in be mentioned a peer in year, double North maybe Just I digits. digits. North X% lines. lines; of say do could have be

aggressive relative capacity maybe you're expansion? your demand the little the actually occurred with that to region, a you've too being that So in with -- -- bit

Daniel Fisher

appreciate question. the of No. I -- inaccurate. it's and the the question thoughtfulness That's

with line an have in tenant disclosed facility this in with performing And Keep globally and in anchor is Glendale do been in to in southwest expectations. that we the they line particular. previous calls, with. in that our mind, fact, significantly grow business and In expectations we has in our continue

Scott Morrison

a customer point I industry would out bit different in also of mix. the a has probably that everyone

about. so differences And that some could in talk account people for what

Michael Roxland

Got it.

one quick being prices Dan, XX%, And retail XX%. you mentioned follow-up. Okay. up

are volumes flat. customer Your

your Could consumers So trading given any it that extent increases. price the us to -- environment? down given are push be some private remind label of consumer ultimately you private label current these exposure that to And could possibly increase your exposure?

Daniel Fisher

what And We filling have probably partners the think just relationships to has like-for-like in of I participants very with do -- with. out. that labels, comparables the private general, you it industry we A have of that rest in with lot hard it's to area. parse those have

locations look are happen full. cans to at shipping labels all is you'll into because data be that with will have filling what IRI You'd scanner

be We'd a filling can for volume out a an customer there. trading they that's So really into end be consumer. location may sending

And sometimes graphics cans, are aren't those even they sleeves. on shrink

trading on difficult parse down. you to with So agree that I out.

areas areas. We the you that the back going of that, see later is We to versus see have seen first first that rural down. you trading saw Typically, in where part urban quarter.

see what So a is see then XX-pack trade-down, volumetric a and a eventually you'll and XX-pack trade-downs. you'll versus

your much labels being traded down being share labels base it category a would to stomach. is. high-end to to shifts traded you the Exactly as And medium, not so labels, much as down lesser to see of as point,

may But see the you volumetric the haven't we the landscape. concern increases rate, to hit across you share would be trade-down. at this And stomach price is trade-down so that start that continue -- as of the

Operator

Our of Jefferies. next from Ng question line is with the Phil

John Dunigan

Phil. This a Dunigan for to I stay second. for is wanted North America on John on

that to really that volume which the not market thought lot in. Is favorable for up had renegotiations, requirements getting the Now out contract customers? led in of a some just this seen is case? your tightness until baked that the pushed I we've year of Or

Daniel Fisher

say contracts it of and expectations I majority what the start the Scott, our performing in over turn that's business. were. Keep in to anything Scott. mind, I'll with our then else? would are not Yes. line new

Scott Morrison

Yes.

forecast new is support assets back, the XXX% mean, put progressing. are every ground that I do contract going step and contracts can right. the all range those if we nobody their some in So to gets I what have month-to-month. mean, you the take a of they

So in of our at, case, where like kind right. we're it's XX%

normal. provisions that But provisions are we're But about, we've so contract favorable kind of about definitely that feeling that's what that. talking last the up And years that couple seeing. of X%, contract for talked the the we've been we're showing in

John Dunigan

America you're another, X% for bull pushing say, X%. And like about Ball North in of terms maybe and out of case scenario, a Okay. the then shutting capacity

case terms. expected can maybe broad North And have of the operating that you you kind demand bull of you with any meet to how X% here insight America, in capacity this than to in maybe look your do quicker other that give return in So CAGR projects? rates on where ramp-up to some X%

Daniel Fisher

absolutely. Yes,

growth that. step into X end from the knock-on shows We will annualized going in keep forward add if in step the mind, on We're of it high basis, us billion at the an billion enable effect were range, We builds to have going from up. dry X% powder into. But moving we're to saying XX year. efficiency to excess take to, this units

tenants The very we're anticipating America, into that and greenfields customers, engineering move with disclosed constant in could anchor we we're North the previously quickly and executing in our and thing other against those. conversation

doesn't really able 'XX for us impact step an growth nice So in really beyond. this to to be into and have

Operator

Montreal. of of Our Wilde line next from Mark is question the with Bank

Mark Wilde

cost. want to the call the here I over just the from end volume to of turn at

costs some or maybe that that up inflation of to than might you're you you trying actual better contract use then match the costs doing about We both with to X non-aluminum pass-through so do seen decades. also speed and are that they renegotiations incurring? for higher in Can talk square to the the we've escalators of in the a be what you environment

Scott Morrison

and been I short-term effective we've squeeze various we of accelerated pace used is CPI, we're time, in -- pretty over at now has Yes. PPI a have escalators have the right that environments. seen mean because X feeling inflation most a years. And a been what bit in nobody

long So in business changes for want this the reactionary to what's to time. we of worked don't be a too

big less so looking things are we time take those implement. say, them in costs. leakage changes there's is a to there variety make and will things at contracts in response to tighter I However, quicker But to of that

they've markets experienced lot in for have think long experienced effective inflation, So have North that been hyperinflation In places they America that the high of very operate emerging time. cost period in, we some hasn't pass-throughs of because do like quick and a that a case. Europe, and of

the just that So tune year $XXX we're having -- seeing the -- round another the the had annual inflation to benefits pass-through out. has this we've choked worked. And we're of working. we're are pass-through of mechanisms million It's that

Daniel Fisher

But maybe I'll close...

Scott Morrison

out that that Let me we to in every side, looking are need where costs and can through something we've SG&A things in started also to add going on, our we at already We're fact, stop is SG&A -- on things line. that's get doing different. looking this. support take the and function we And

reasons incentive paid have going corporate that this that to And SG&A Now compensation. not those looks is get as the much year. seeing of line already of most from we're better we're the feel one

So with shareholders seeing. what we're of kind line the are in

a costs, while. so something cost support expect of very and we to our we in to on savings haven't of out and That's do our a corporate lot And focused costs areas. we're reap those had

Daniel Fisher

contract. pass that spent more are that supply where expeditiously, on through area -- We're about but ODMs would ensure the contracts. decoupled of from what's extraordinary customer a would contracts, are our need time area haven't contracts a time that lot that awful margin our contracts our lot on chemical and cost we one our in mirror supply we we be has we absorbing well. not recovery supply an great We our to be calls more an wouldn't contracts, customer side. to costs embedded Mark, relative on and as improvement And to deal that it ability of the cost spent customer clauses. on time previous a those spending Think

Mark Wilde

Okay. quick it, in seeing the the impact, cans, is one, American going know lower That's this helpful. real have planned answer Mana think Listen, those these one you're I this and is on not growth particularly expansions beverage But expansions, timing other I here. North project? any sheet the just around to can or

Daniel Fisher

no. is don't X online from anticipate We now. The years will X assets come -- as again, answer and these It's today of that.

think the number I were in -- earlier and go with week having They folks So forward, all were just it was continue. a just we message, do strongly actually of believe this circularity we we. as conversations, those

packaging. beverage thanks continuing and No, around yes, bullish in question. story that for the very So and invest people circularity think aluminum about I to of are

Operator

of line is the KeyBanc. Adam question from with Josephson next Our

Adam Josephson

what your just you for in short. it American you months the How just have Can now? you're, normal have Can two North caught talk might about to you talk industry the visibility into what mean, I about demand? now years, of you caught many long. was is? So visibility compared And effect, it be

Daniel Fisher

or of us we No. for challenge is missing the be used That's makes and they have able big in we're hold to here much the to customers you relative out actually And than because into to cans what It's access is vest. by of being our what with a don't of to access, don't that strategies volume step a close fear question. access don't to longer now very great can our right dislocator The probably have it it a That's -- innovation. have terms their ton customers. seeing of big historically standpoint. to, I from sense. pricing something we

that's sizable where a increases they're the having we're last X at -- challenge right conversations the to price over months. now so relative where versus And

much on X in months experiencing if get you you customers. have volumes. X a on now like to every revisit or to with XXX-day they've your we're right probably XXX- price can But period, dislocation decided a stronger go So point

Scott Morrison

and mix, is all say, with filling we What I strategy X the X, package what more ago we on and where their mid- and would than of they're have today do the the years mix our and of side. the visibility planning they're had investments their thing to customers, that sizes with that making long-term to

better a into We more near-term bit stuff visibility have the challenging. that's that. little It's

Adam Josephson

that. appreciate somewhat Got it, I Dan, And similar and lines. along just

quarter. that You But saw call you have mentioned been demand mentioned now. your you earlier, in as it, in in second customers raising the deceleration the prices late release a the for, year

I come as did all -- seemingly wall, was of why to would ago? at sudden would have Why a head it months a X hit so, So did X seemingly growth why recently guess, least? have all it quite months happened not -- just you just a ago,

Daniel Fisher

specific had There's if a I to know Yes. recency don't bias. answer certainly I a that.

into Xth anticipating were There's and However, going the now. consumers of didn't It grocery to right been everyone's that. activity, come July always Memorial through. for Day less us, there's promotional basket

a I Scott, So don't I you've got think bias. there's know, on a thought recency that?

Scott Morrison

you're economic you quarter, data. at looking recently, of The okay? more, pinched second And some happening of if things, been we've mean, lot to been most a fuel recent consumer starting had get most the what's rising. the you prices see I Yes. at look

are economy, a money prices to the coming that tick lot loans, the in relates that to to all the is are bit. student cards the thing see it of good off has credit been of XX. But up a was through that stimulus XX fuel spent the think And first year. now that into people I starting Now as to part little delinquencies you're for pumped

of starting been more that you're the stimulus consumer money now lot spent has get economy. see So because to recently more, through pinched that a

that I if you X% of price see see. But for see we're or to going X%, happened. they time, hasn't more volumes bullish. in where period start raised would their decline we're that's think think X%. we'll to used So What And to that I is their -- and we're a volumes,

back things situation. As normalize, more to look kind normal we get of term a we out think and long we'll

Adam Josephson

magnitude because these elasticity demand of extraordinary the just takes it? over of at can there's than And on it about price talked just the any as you you've and lastly this the case -- Is recession-resistant, now that, so that has do increases just cans there is historically nothing about and everyone point, beverage has. just been inflation -- some pretty and less always anyone

Scott Morrison

I at look a these right? you again, don't a time real in a anywhere want we it. near recession-resistant. kind digest up if at are And changed digesting it's terms where to mess. if mean, of anywhere mean, you at. at it holding to of you the and I not But it's be, and them think No. it, not not world, where we're The step We're our look reasonably I you is well. bad. back it's disappointed little numbers earnings We've of world time, near. look if in had everybody's take bit -- -- that

clearly business, have not immune XX-year in this but euro shocks think war when I a deflation. is you a is Europe, recession-resistant so it And still inflation, to land

Europe. to price is going those things. in skyrocketing Energy short-term You're feel knocks from

You're feel long-term knocks. this it beauty the cash, get is will it But flow short-term of it grow, returns. going to will business and will nice

do I we term so term need lot address long things, things to near pretty to And in at. but happy feel these bunch not still do to we where at. We're going with of think about good a is we're of that we're intact. a where We're the the

Daniel Fisher

closer to, Adam, lot one to thing this. clearly a to we're pay attention

if growing So are costs simply up, are that inflationary not through one look significantly. and they our margining thing at customers passing to attention you to, pay

inflationary What's over and resilient. above now price up hugely significant is up. margining customers right it and so And putting cost decoupled pressures is

have volumetric to pricing is a not a That's recession. going impact. that's That So strategy.

everybody just I just refer pricing cost. back days. They're growing growing, So that talk We'll to that's again -- in Chris, with think customers I to now. pass through for all middle-of-the-road taken approach a we're them. XX have and that's and

Daniel Fisher

be on many make of as September to forward The XX. as can is you going it. investor seeing conference to Look

Scott Morrison

Thank you.

Operator

for conference today. you that disconnect thank for participation and the conclude does your We ask your That please you call lines.

Ball (BALL) 4 Aug 222022 Q2 Earnings call transcript