O-I Glass (OI) 26 Apr 222022 Q1 Earnings call transcript

Good day and thank you for standing by. Welcome to the O-I Glass First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker today, Mr. of President Vice Manuel, Investor Relations. Chris ahead. go Please

the Thank quarter first to you, and welcome Jillian, O-I XXXX Glass everyone earnings call. conference

John today review and discussion our we will led discuss Haudrich, and will by Today our business financial results. Our key CFO. Andres be CEO developments Lopez,

I'd call review of Following prepared materials. the to the in comments the disclosure this Safe financial turn a on measures the those Presentation materials Q&A start Harbor like remarks, available session. company's non-GAAP call included who we'll Andres, for on host to are now website. Please and X. Slide over will

guidance Good a due expected than and your strong appreciate Adjusted to interest productions reported results shipments levels. quarter Glass. exceeded last evening. We per morning, primarily everyone. first $X.XX earnings better in I of O-I significantly share

the As left, illustrated and year. a with glass healthy, all adjusted the key increased sustainable up URI did to a production speed of efficiency across business strong nearly the measures and improved prior pronounced great Americas, XX% inventory in rebounded increasing X.X% storm In was reflecting job most from for boost the also from team historically winter Shipments on the demand EPS earnings demand to levels. last amid meet growth year. the containers The low impact Europe.

cost margin offset As performance benefits all ongoing expected, across higher our inflation initiatives. expansion and favorable elevated prices more than markets the of selling reflected

not do impacted. in or have Ukraine hearts been Keep Our operations all to we have impacted so tragic go out not directed we Russia, Ukraine. the those in mind by conflict in

macro elevated O-I disciplines, chain But have demonstrate agility continues complicated I its elevated an will uncertainty. execution even cost and inflation supply later. developments issues. on despite and However, to increased commitments discuss delivering already challenging these situation,

on transformation. through managed volatile very highly make our we good to we a environment, continue progress As

multiyear Our start this are good off expansion a year. initiatives margin to

in expansion. are investing We

we Likewise, portfolio addressing Advocacy MAGMA, our and advancing and ESG are We legacy optimizing liabilities. Glass campaign. are our

approved As process plan final announced reorganization. milestone will mid is key liabilities overwhelmingly optimistic Paddock and the proposed achieved asbestos XX asbestos claimants the legacy XXXX. the remain these we recently yesterday, Paddock of that Chapter entering Paddock resolve another by phase of has voting now

we for reflecting good results momentum. our Finally, optimistic increasingly first are quarter outlook, strong business and

We range. expect higher John quarter have on earnings raised end our our second financial guidance results expand top outlook and we will and performance bit of later. a the

Page recent to Let's X volume trends. our sales move review as we

fourth momentum the key this almost month as across and regions on increases X.X% volumes chart, are increased believe has in The sizable began see the even several continued prior there key the geographies. can which price offset to than all that as year. implemented Shipments you the quarter start we demand XX%, Americas for up through increased quarter, more strong demand. X% the first the were the accelerated As cost exceptionally recent Europe was elevated to of of both each We drivers been inflation. strong compared Sales year.

dining, emerged at seek that the course trends over increase First, pandemic, consumption is glass the such where healthy from more as home experience. premium benefiting of and a people

we over and Latin Europe locally up be has demand continue conflict, which displaced in Spirits, and below in globe. for markets, is globe, serve across many product food which sold due product beverage At strong demand time, and up. recedes is the in same geographies markets across European rebounding are from the the to remain imported including As driving many and Ukraine Wine to far and well Europe. levels, glass America. all across is and glass demand exported historically On-premise produced COVID reopen, All-in-all, recent are inventories markets a the been Russia seeing especially we and pre-pandemic

is Finally, availability. around and XX% compared Keep our increasingly in our mind inputs are competitive glass plants, XXX substrates, glass that miles cost of sourced. to alternative input relative within more XX% of shipped locally is reflecting and our than more of

global impactful digits on issues less shipments chain grow XX% local glass is growth and for have last we the emerging second supply trends, Reflecting with from substrates a the quarter, low result, the than typical year. comparison aligned As ongoing chains. been these preference supply glass other despite will well single expect in

volume expect in be our growth our exceed the now at XXXX. Given end guidance to recent positive full original range sales or X% high will momentum, up we year of

trends, macro to monitor outlook. this we course, Of which could affect continue

we mentioned, in capacity I levels. low inventory facing we manage constraints As as are key record markets

Given the we developed capabilities global years. over productivity to this that we few challenge, past increase have the been leveraging

As be managing will ambitions. a strong that Keep enjoying manufacturing mind new are growth. capacity years the result, production growth in benefits improve strategic demand the speeds over Likewise, the business are and we mix our increasing adding to boost meet we our support to margins next and efficiencies we support customers' of substantial few demand. better to to

of we X. Slide continue On advance our performance, to top favorable turn near-term to Let's transformation.

our We margins. are expanding

are $XX will objectives. to O-I good expansion increase quarter initiatives the selling are Likewise, quarter. meet cumulative a to All-in-all year annual pace we starting prices off in million cost first successfully as offset its we and pressure, incremental start have price a with achieve inflation. target. confident raised implemented During our on second we the we inflation net Faced full we price are margin second our

we demand discussed needed support adding in to robust we As remains are growth. markets key much and capacity profitable

Canada in projects expansion first online in be should The and XXXX. early round Colombia of

changed. conditions market However, have

key much items investment seeing chain capital our lead These capital and to supply MAGMA challenges. original on more issues are inflation development impacting cost times timelines. due and longer We are

plans we resolve, to with agility. So are evolving our

Likewise, our more MAGMA scope initiatives. which are valuable, expansion critical uncertainty. scale We execution. large X valid brownfield will project we is as rather macro projects, development or capital well the even even expect and risk volatility a of timeline, and smaller be increasing a for than solution, broader of greenfield range These accelerating few short as Gen

last laid all commitments, out I'm than return While be our within will likely and little profiles. investment objectives we we year, evolving will original a our our plan confident what achieve different

and also are of Advocacy from now being one comprehensive sources, set big renewables efforts by of is progressing Please XX% towards ESG ESG the electricity supplied ambitious Nearly step well. renewable Glass of goal O-I's a goals. third our see details Our increase our and XXXX. appendix which change

digital campaign gaining alone. the Advocacy over with digital impressions XXX quarter momentum Glass Our first million in is

Better the country by angle which If you slide. we more joined include is the great song call in new Chase fun star, efforts song details another Glass early, our you marketing a likely a heard rising of represents a a this music bit and on McDaniel,

we year or entered program, and $X.X agreements problem end. have I As part our of this billion, into remain highly confident totaling complete portfolio before completed sales we optimization will

that Importantly, liabilities resolve asbestos its midyear. we legacy Paddock optimistic remain by will

the claims As consider plan, channeled mentioned with trust. personal Once Glass and [ph] be a plan confirmation District court by O-I go the will plan affirmation asbestos overwhelmingly for $XXX will have seek trust Court. plans through injury of the order is will to Paddock Advancing the fund occurs, claimants effective, that and Slide Paddock's Paddock the proponents voting currently A Delaware confirmation plan million will asbestos approved scheduled bankruptcy X. hearing and earlier, the by May to of the the Upon of reorganization. XX.

been capabilities priority. tremendous years, the we five seen the past building the start since pandemic. of We For to agility top has volatility navigate have have a now the the

on As supported by solid, consistent delivered a result, execution. commitments our we have

in our management long-standing up performance, leveraged and have we years, in objectives. with time, the optimization, to two are and At demand to materials ways key financial order find to past meet portfolio inflation, the shortages and inventory severe to same relationships expansion. -- much-needed For issues pay capacity customers for improved freeing capital logistics suppliers stakeholder overcome

and with We an to are acting volatile again world year. uncertain navigate agility this increasingly

the taking this approach yet into page, rigorous a for all has in yet clear are not I'm performance execution, valuation As a confident Despite illustrated on change the and O-I, facets we will. [indiscernible] it of improvement business. step translated systematic across

to well our exceed including meet the is to now O-I commitments importantly, investors. More or stakeholders, positioned all

Now turn over John. I'll it to

X.X%. I performance financial Andres, on start cover good I'll business a rebound up from as earnings performance, reflected XXXX and was last our of $XXX Strong price. recent benefited which and operating winter outlook. topics operating volume including with the of million from everyone. Uri increased storm today review well inflation. plan year. added performance, profit morning, million, as progress to million few priorities, Thanks, Page net Volume a which share, X. per last by quarter in $XXX favorable as O-I Segment segment $XX also year. exceeded solid share. guidance $X.XX increased sales net Higher Favorable significantly strong elevated of than higher profit earnings offset first operating adjusted mix reported and prior our on XXXX year very cost and first as $XX million, selling shipments $X.XX our per quarter of prices more price results

more operating favorable performance Increased strong the significantly million which posted storm reflecting last also improved amid demand record reflecting $XXX Americas favorable our the and first reflected initiatives. The Higher higher our operating across benefits year. improved $XX with winter up prices, segment on which Very Segment production inflation. costs Overall, details chart sales profit last volume program. efficiency operating from $XX margin from from operating was business and speed segment additional inventory reduce cost the from in prior nearly also elevated increased as by year, expansion well low supported than results, Uri $XXX our costs. million, and rebound margin spread, growth, helped as Earnings year, are offset Finally from in profit XX%. Americas incremental profit In of earnings levers. operating million. X% The key $XXX to performance operating levels The pleased X.X%, boosted million, items. quarter we very both than and levels. which provides performance, Europe expansion more segment all higher benefited nonoperating favorable ongoing benefited million compared selling shipments good Europe.

Page turn X. Let's to

solid financial our continue We progress make XXXX on priorities. to

use compared chart. the flow first the historical to the free as been of a While recent cash see for has quarter upper favorable on performance you is seasonal cash can business,

a billion quarter. We This completing sales totaling the continue tableware into in well signing stages will leaseback in and schedule. to advanced we February and transaction, original are ahead $X.X the billion we advance our Portfolio close includes which goal in Program to this second of have to achieve set Optimization and that our $X.X date. entered sale sales Other Colombia asset remain is confident our projects year

As liabilities feature fund to XXXX, legacy the includes by we bank to refinanced our a Trust. (g) terms, our credit delayed Paddock attractive $X.X future agreement asbestos mid draw billion which we at resolve million expect recently $XXX XXX

which leverage, lower financial to advance time significantly continue shown declined de-risking activities we and O-I's in Finally, pension chart. as the year, from our this reduce last

Let's outlook. discuss on our now business I'm X. Page

around mind will which We expect assets per $X.XX quarter is anticipate of between Trust. performance improved year. incremental of sales interest from outlook from From is a in to the $X.XX adjusted second We we add net up share, range base of recent Keep expense $X.XX this dilution and favorable we last revised $X.XX price. $X.XX expect as net profit. earnings anticipate $X.XX Paddock funding continued and will business

noted, have persistent levels. given moderate increases Shipment implemented constraints digit likely low historically amid single pressure. of cost this a second Andres As growth price to inventory activity we low and quarter capacity will round inflation

anticipate cost strong operating continued performance. and we Finally,

full activity about effectively ramps the Operating inflation. However, business containers to increasingly raising we do project sustainable outlook. solid we Shifting up. incremental for glass expect healthy, expansion XXXX we Demand optimistic and prices performance cost recapture to an strong. remains as is our year, are cost are

monitor natural trends of continue challenges, we demand to such developments and gas including in including and inputs course, cost as Of Europe. macro availability supply key

per quarter revised elevated $X.XX year We of our top earnings We period full the momentum increase as guidance a favorable reflects the adjusted first business outlook. range. between $X.XX now share navigates results as of and have Improved expect end we of uncertainty. our earnings and good

cash also reaffirmed our have guidance. original We flow

Now Andres. back to

John. Thanks,

this on a slide. this wrap me head strong off up to year. with We a comments Let few start

packaging. exceeded the as well glass guidance, strong levers First original key all demand a our performed significantly sustainable across for business supported earnings by quarter regions healthy

we margin initiatives and cost of set catalysts Importantly, create focused well. our of going value. on recapture to impact near-term to are the expansion inflation a are Efforts

demand with enabling and speed strong are a efficiency. increased We production

our higher expansion this we alone. have is Likewise, this and second Optimization and our of of by our expect that moving establish our interest projects effective decades exceeding years. decade will to past the the O-I a year intend in litigation legacy earnings fair as resolution we XX% program respective Following consumed more have complete team, both to support welcome our of is cash a swiftly year, we full Thank consistently over commitments. or our over the final remain flows midyear liabilities Portfolio demonstrated asbestos in reflect meeting we organization, business year XXXX performance. and quarter, capable three Program confidence and and which which and our last for execution expect that optimistic disciplined your and in agile your questions. much about O-I and Glass through over and in you We next

[Operator comes from Instructions] Your you. Thank Baird. Ghansham question from first Panjabi

Your open. line is

on everybody, a year. and morning, Good strong you. congrats Thank the very to start

Good morning.

just strong with us as being us been cetera, give happening situation so the first et Ukraine a of a plants guess sense just Europe, And sort sense I have high the as started in backdrop, of you why what's to competitive terms located terms what better in can level and the in thinking just Europe? off Andres. then current in just in of capacity volumes in is up Russia, morning, to year? Good you. give Thank

Thank you, Ghansham.

situation which has demand quite been driven much pretty every are by in The involved. positive. Europe segment in So the is we

mineral Now substantial is volume. that decreased pandemic during time and is dramatically fully which a the back water,

As before, soft were we've Champagne, Italian before pandemic. Prosecco, the Wine, Wine, also said quite Bordeaux they

as local exports. entered As stronger the as and well or year so, by in driven and categories stronger the these are by demand becoming we they're pandemic, and last

Europe, performing present capacity it and large for is is demand we not used seen in that are packaging. that And from and go in and future. very suppliers, to your boosting won't where in that multiple a foreseeable alternative we beer and the and Europe growing not of the very and Western to our presence ahead two is Now, fact your Russia [indiscernible] and in, France factor going well reports, markets any for Italy, you've have extremely question related anymore, is also the is into go size, fast that it Ukraine

substantial is amount capacity. of that So

while also some a macro likely will down and take shut because to the most conditions Now, capacity return. of

So those are specific to Europe.

of on-premise factors that strong. are to in glass At are been the off-premise common all very Consumers there including Now, are home products. on markets, and focused premium Europe. consumption has remains, performance

very and to oversold. in because really MPD glass. So continue convenient the supply is impacted, and for channel a is ship very is not low fact, Inventories will they The the in is many are chain and local high customers. favorable glass that's while market totally for is activity

the that us you're amount on settlement, Okay, And share that thanks at the Is you other would in? just you kick to taxation full very of And the tax color in that year consequences? then Andres. asbestos just deductible? Can with obviously us close of take point. terms very, could fully What to any for tax start the this? through this

this Ghansham, is John. yes, Yes,

a deductible Just type item. the this of be past also tax in would payment as

taxes extend things that be there's But a this. And need tax carry You associated obviously, for and this that reasonable benefit with shield of period considered. to like net out complex, there amount organization. of and the that losses does know, is forward are

carry now, tax years company Of extend forward be window. considering but matter. loss in the the comes of is net probably this into a regimes couple does But play before will course, that that it right position it

Thanks so awesome. much. Okay,

from from Truist next Mike Your question comes Securities. Roxland

John, a Chris, start on congrats the strong year. Andres, Hi, to

you. Thank

rollout. your follow comments to wanted the up just MAGMA I on on Andres,

sounds EBITDA that free was plus Can us to at of and I rolling in Investor you impacting out just you projects the and have out last Day MAGMA? that three-month lines How affect is by chain how you labor. your quarter And I that more the that think now anticipate you that guidance guidance think out? on contract September? now you the see provided do supposed due to or were also you flow this MAGMA. out rolled does XX cash the roll supply It XXXX. playing activity in the delay color give any referenced

Okay, so Gen goes which Gen progress alternative in very fuels making we is Ultra, designing Gen Light-Weighting that, developing which for MAGMA are X, developing X, as well MAGMA. containers, use good with X, as along

our is everything the delayed been else Now, as taking in project as has development you mentioned. space, longer,

is it it So depending or is less. on equipment involved, is more what standard

Now, slowed lately and that has all The labor development, shortages things impacting these also MAGMA. lockdowns have the COVID development times already we mentioned. of been down

So resources timelines. we we record so on developing our are increasing can MAGMA focus and

is supply general in in capital the projects impacts. chain, of it to high same the equipment and it and are pressures very inflation equipment Now exposed

engage doing support Plan. our lower to or in smaller capital an we we're with we plan analyze capitalist whole projects, can implementation effort call that faster function what alternative be and Reset So identifying be that is projects simpler a geographically distributed. intensity, implement And to the and third-party can or or

we to reduce the So committed to. allow risk, they us objectives but meet

the including of will details out change objectives be available for in X intact. and in the going to deployment are able MAGMA the So near you, same more objectives are Gen is to forward developing sure that and meet making share for moving on to The projects composition laid But we future. XXXX. we're we

is, in to earnings Mike, managing on place, We're should be be means much said, out should for in clarity the be sheet achieve that all related I-Day outlook of to in volume that, we And, on able our as be sales intact. very growth there balance later place, is your this question that place. laid earnings should Andres

a off be more bit going It's flow chain generation be out three-year the bit to the once there. But side because the supply little plan remains a little we we cash over it elements that lumpy of got cash just and going cycle will scoped lay out. intact. the future in On fully flow the just is lumpier the

to just achieve what comments far thank you're will good the any very there's you're looking on luck that, John. providing trends on you you. seeing quick, and do you and to Thanks When on much, thus plan, you the ups update an There's financial I-Day? metrics have it, two XQ? you just then early at And quarter. on laid be just do into think Got the two follow out quickly, revised

laying out quarter as far are as chain dominant that, the Yes, update doing that here. supply issues understanding the will next be probably we the here, factor

So and plan plan be the just we'll lay supply we'll that persist out chain also new change. revised the We to and need as going agile like everything that. continue have to to issues continue understand forward or to

continues way. operational this We it demand. regards globally organized, just the shipment, day all our are to it and very forecast less with well the are which is in and repairs The also reflects point. serve leveraging to But but that they Yes, one markets increase large we shipping performance able the are strong. demand place that across efficiency mentioned be quarter, to second developed at teams to strong as that The quite forecast. speed capabilities allowing incremental our and taking us in April is very line with even reflects furnace are

very the continues year. so that. And to and are reflect about quarter confident We're very in our optimistic execution this we

Ray? question, Next

Thank you.

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

understand dispersed. some quarter. guys, at elsewhere again, just midpoints we improve versus obvious just the that assuming and the the you've with half the both the, happening the for to first extract could look last through what what would could question had you're just that's I year what's perhaps to is, like, effect simplistic we degree congratulations be, that in And got guidance, unpredictability clarity to that MAGMA. inflation second follow on that see look Mike's and like? my the with, trying suggests second MAGMA we and of guess in model related and just of frankly, terms Ukraine there that? more I with what is quarter gentlemen, because to that any at have in then the in analysis, that so to I itself amount where details and cushion building question and the to you cushion, then guess the there, pre-buy And guidance from the you Thanks trying for look then use when that you to of modular there And Russia your year. your of I'm thank capacity if what And down is a that And if it is results? in would the Europe contend that. a question, and presentation for geographically not was recognizing and were quick XQ, on continues smaller, morning. for go the more good Everyone, of

since So that's sure in using of the you're exactly luck to adjustment the I'm getting of at and quarter. itself in dispersed? modular what in Thanks, not is MAGMA plans guys smaller, terms more the a capacity plan good

you. Thank

question. me the first just with let start So

very and are is Operating about very fundamentals. strong. see very We favorable to we the optimistic continue performance year demand

We pricing inflation. cost effectively through are

So a in good we are position. a in

risk, difficult But will that operations example, our optimistic a it determine is all are and and is by the Now, potential we year. that for impacts to all there also just industries. point, input recessionary want know, we wine. characterized, which supply uncertainty pressures and just to as point it's volatility, chain when solid the significant reprogram. costs for at are and glass, not we It's macro But be. And some not is

increase the add of range to by $X.XX. you're about there some that, were on specifically to you George give number did top doing just to and it. the our perspective end thinking of how maybe We the we Yes, calculations

pressures, things But we at that. the cents the the end first by added do like time, at look same a of $X.XX. quarter expense, have guidance and original interest we top exceeded of it, As our dollar, stronger few higher

there. So drove that that net of $X.XX number kind

business outlook guidance on original from to dynamics not end. top just forward our reflecting have was what further made We the any those our adjustments

we market mind So to of headwinds to thing will and divestitures, the early half have $X.XX of is, as outlook we year additional year-over-year second on One with associated in obviously, we and our FX, the do probably the dilution, continue year update in volatility. navigate Paddock. the it's interest keep about in

mind, kind numbers structural which good, are in year really elements indicate back to operating there, the be an expect are of those half in operating from just standpoint. the would performance performance that and we keep So of them

very Thanks taking the for that, strong for fair. regards place row. pre-buy, With to John, shipments two in been Europe have a in quarters

situation. well takes that to believe regions, take impacting as factors that pre-buy Europe, So when really as common this consideration into demand is the drivers. various us are factors we those believe individual a to the not that all in And we the are

it that. We smaller and very implement quarters us and be two a the there you're to in allowed be pre-buy It might pre-buy some. row if right. is capacity MAGMA, a believe all With little wouldn't regards So is, situation. to

very projects that times is However, MAGMA, most large projects impact primarily the the One and infrastructure lead implement projects our extensions more that. reason those it. with for things are kind is we that of very than small needs to like and through issue them, civil greenfields, lights the but for of and that are example, and inflation had in plan greenfields large very

steel all through a going So buildings material and inflation. that, that's and

are the what example which really drivers of value is our plans objectives, the reconfigured meet is more of So of what which for with one at we O-I shareholders. change are that is doing our lots agility,

years one are Gen infrastructure and cycle and one like still accelerate that the of a that. add that's development the a were X thing now. situation component, because the maybe on solution like or the manufacturing great rely we over is for that next is Gen really plans seeing we're X, X.X But ultimate to light items. more the lot here warehouse why it that And go couple Gen the into on X MAGMA want you ultimately, things really to scale we the larger of the a which to Where allows in down solution

Thank you, guys.

Thank you.

comes Mark question Bank of Montreal. from next from Your Wilde

line Your open. is

add like quarter. my very good to I'd congratulations,

you. Thank

the be how whether market? higher you they're energy going talk going in quarter Andres, forward, which any in and European in prices much Europe, can you that's pricing long-term like is causing about your first the European whether for looks to planning managing energy sourcing are the changes changes,

this. last able to not been big to our be able support have than of to be plan increases we a Okay, -- to to a also point. with through we the to price with commercial manage fully inflation situation middle in deal so allow in started are space we're deal example, And to a our year, for the and long had started procurement, capabilities later to today, ago. all that But us work according plan. work offset our we've the for our time And inflation the executing going to capabilities our

plan lot from very right well to deal the believe of culture need with from functionally. work. standpoint, and also executing We procurement kind with And mechanisms to we work this a that. standpoint, and in but because works cross plan we is that a we're line the a well, early through So we commercial you these company this a situation, of very the cross of company, functional have

need You at a to perspective do Not point. to need you functions in finance it. of this the Is change the be this business? there, from lot business? able of team help a business impact you this need long-term our the intelligence, Can different in having

good If we navigate can way feel know believe we'll we well. today, what we if far, this. the this we've about things with think been we things deteriorate, adjust handling change, I accordingly. very so to But

points. two add would I

the is to investing the flexibility. capabilities be increased so the even that MAGMA an quick, over with from gives long-term. things biofuels that that between of would off oils think those years markets it flexibility real then develop, that over And and Mark like more really you in other energy I few able flexibility know, run road. switching other hydrogen are just but to energy, energy on to the long we you and run have standpoint need down that's out, a Granted, we

to have want And just of in of altering on cost kind Andres, of those behavior are changes that, the I versus meant us sense substrates? give and whether Okay, some other terms glass these of following relative what you your any of changes customers? costs of the all can of

boy, between the of this so you was has really period gap decreased and time by packaging, will. alternative there for a That one if differential Yes, us XX%.

it favorable all to glass. for is purposes, So

seltzers, keep when in water, with to sports compare drinks in or driven it particular, carbonated by And are different case, important in we or In are aluminum Now, and wine, lanes. in bottled our energy is cans, in by drinks, that cases, mind food, those NABs, products, performance. growing is and soft by demand beer. spirits, we hard drinks, which in our in some play they in premium their driven driven driving are products in we're

in you we two, a So gap segment a if want are that to the closed. container in between lanes. But play different given has segments. different We compare for

I'll you. over, it Okay, thank turn very good.

you. Thank

Gabe from Your next Fargo from question Wells comes Hajde Securities.

morning. good John, Andres, Chris,

Good morning.

morning. Good

in forward even or of by been before So the you wise historically it's I to a just kind or year speaking, Andres practice energy hedge think of that. you beginning guys, confirmed kind mid

where those I of around single of price that think digit making. the Europe is that we Would and goods, at want today? on at sort just round where to I energy of what you're kind imply increases of it's are energy of rolling in fairly think appreciate of about cost volatile you depending kind XXXX So then as moment, but need I and forward, high things say another freeze XX%

often as done question so we to, going was implemented record last to year so our the been and inflation? Yes, will. go regards And And to first the had we increase got answer with are yes, very you second. our executing continued We we inflation up. we've promise, we it we've price

itself And will incremental inflation, we to going if with the take continue So monitor situation action. inflation. we're to presents

with quarter type long-term over quarter long-term. our add so We financial structural not the to go, don't organization, would that Gabe to month manage to very practice or we it's I And of approach try take organization. month the we a management and procurement the of to a

they've I guess, terms consumption seen then of there. the and it's consumer a or the either, versus seen down your in side, they're in side, or sensitive assume I a at bit customers, seen have you've consumer inflation And think And economically you patterns guess, any little reasonable more more change, runway? replenishment down fleet the that that, to I given that like on Okay. bit maybe Brazil, on anything returnable little of the

is inflationary large available of very this less premium taking volume, impacted generating is so is the the tend in for situation large full to Brazil. products a and in expansion the place glassing by Brazil Yes, in which there scale capacity utilizing country. that be -- a beer in Those

used So point expansion this and out. beer All at the being capacity sold large this scale continues. is we are of premium

not is in see look that the how and returnable And Now the by returnable emphasized to but presentations are through going a being country will containers I is take customers and emphasis in you that encourage also latest the only system. you at large glass. glass, in

those returnable countries, customers. when that inflation economies, by good very goes are a those in way to containers margins know our in You protect up

Thank you, good luck.

next Kyle Deutsche Your from White Bank. from comes question

open. is line Your

for questions Thank taking strong you, congrats very the morning. quarter. on a Thanks and good

up but X% the through I you Just for through volumes up tracking February. are hoping to understand believe cadence the volume the better quarter, know, X% quarter,

acceleration such details and in or is this Was why share provide? Ukraine from to you So all just related any Russia an other March? taking can

common factors the described multiple that particular the markets are it's we ones are that to think Europe. I Well, to and

for is accelerating were Italian the time. mineral was in system. partial channel The fully water lower, Russia Europe, year performance So entire capacity, very was mineral that up. example, The Prosecco, wine of and on-premise activity, champagne described experts course, when in into in countries locked economies the and buffer capacity down Wine, Western and period demand. going is thus now or is that are it of still driving the in the not in Europe, that a that the limited I strong of for incremental and Ukraine water, is Bordeaux

when take think is Europe, we it consideration into important that buffer. I a significant at So is there look to

quite buffer the be consumed, about of before us a demand to Europe. So so helps is kind bit in confident slowed demand that that down

to sense benefit have If balance how the quarter you, from this volumes you do a and year of Russia of you of for just follow you Ukraine, were I from up, could much that? expect a kind and for the

taking are around multiple could place, dislocations million we if highlight that there Yes, million or be tons. but would I guess gross it a X number,

Europe over about it's an idea. system in So give to XX million you a tonnes

buffer not X large very demand tonnes that or just needs to market. that's a by gap be so local It's it's create these capacity. the of Well dislocations drivers considering million the in absorbed a and that the incremental of

update Got guys I you first of levels? my it? provide question, You inventory was should can the Doesn't just quarter. seasonality And quarter the build the necessarily seem up then second typically, this the an about that or balance believe we kind impact on to it? use or think you typical the demand like that your know, of inventories. volumes strong case given how maybe through Will year on

Well, manufacturing our last this work in much to of demand can be, very Integrated which our result we two we were saying. a is so they to all with the flexibility because the of when three as combine we than we the And process, that different supply changed you planning have our be recall changes The is company or years. company what business the inventories and -- might that and that which of implemented reduced capabilities, processes and do planning IBP are over planning that's lower used Business able operations, inventories why the how Planning, run. it reason can this and we been

lower. are inventories our So

is demand strong. Now, obviously, very

point, limited what go to we to So we it's in the I further described And able by I of be we're inventories. believe even we at before. some places sustainable. described year, highlight be might to that because some going But important are still believe down this think levels for we

done the points. eight the a on up about our fourth data done to IDS with between back quarter sequential first couple and days. that a just of basis Yes, day the On a And putting they're basis, quarter, about to to we're new there. as year sales says, believe usually in Andres But do we And build new through right, to up start we are you more manage days. new, technology. you're technology. summer two was This continuing inventory year over lower some inventories

going better talked to doing support this and able efficiency about So this to additions that this to in up business capacity with good regularly before, mind, we to be building to we're also forward. keep support the speed that. we are And be able

of inventory increased that to seeing. demand we're So the efficiencies supporting combination is managing lower strong continue growth capacity to the

we and did in year. last extensions some markets, line Yes some

So to something we in that us That's previous in demand incremental markets. highlighted calls. that serve supporting those is

it, thank over. it you. I'll Got turn

you. Thank

comes Your next Josephson KeyBanc. Adam question from from

Your line is open.

Good morning. Hope you're Thanks, everyone. well.

morning. Good

by Andres. seems severe. Free a raised net for if language it inflation you you've I Yes, of income a the morning, John cash like your expectations getting little your raised good questions And more something. cash you volume -- know same by don't couple mind. you The guidance flow was flow bit. is

the extent at all? for language above your free flow So at us the to range same, be expectations we cash very changed big can know have I XXX but remains could the you know. a just help or with all which

you this thinking it months are And that thinking year? really about flow wide you're could is cash free about to be that compared three how range ago? how So the

And mind, parallel our keep earnings to Yes, the, yes, thanks for in that's the outlook. question.

we our have $X.XX outlook. is So $X.XX know, EPS to you

$X.XX, the Well, that So of floor the is that the cash free $XXX do is number. earnings equivalent million think floor. flow to to that, kind of we

it believe earnings the to free outperforming improve. cash that also guidance be continue flow to continued mid our end to range, to would higher that that the So of on degree would to lead you

kind you get kind can you a to feel at a range the sense, for the that So opportunity a of look there. magnitude of and of give

is, take of EBITDA look at one know them thing You cash flow, you flow, a cash stable know, I of levers the overall. you pretty would our besides remain say most other

overall, working a you -- look is this we're pretty stable obviously, little going changing expect the year modest the around much prior to at a your they but compared pretty year to capital we numbers the overall that cash at intact. continue the forward CapEx are be plans free be pretty of source We year, our a -- outlined bit, stable. levers end, And other are to

of about we're sense you range that the and So gives possibility and hopefully how a guidance. thinking that

I appreciate it.

is being, that little up higher a number thinking or that something end not are $X.XX it $X.XX higher, or you really bit what it's but be could than mean, no, thinking maybe are I followup, could think the considerably you we one Just dramatically.

So?

of upon at that And EBITDA Well, movement. by based the yes, and range look that I the gives you range. could a you think the it's, at picture, and earnings least sense

choppy, choppy things with the supply is, investments You and know like that be that that. other be just could thing could issues capital chain

at. So a those mostly the taking variables look are we're

beyond this ends two next or the up based be year material period? you year, conversion as are be that year in this for being and over years, you this on plans perhaps your fashion pretty CapEx thinking change it that thinking Yes, your change similar the are just will three-year and could over your John, whatever conversion conversion will a

on say out conversion would primarily will on I flow, what that capital, the focus is, because we Well, taking lumpy. cash strategic be that free adjusted

our we is So, generate cash that Investor XX XX, free period that of or think guidance flow over that I Day, like was or conversion to that time. it we've during of provided something adjusted expect what

are you later better again, then the is year, than like other to Overall, and bit things. seeing it's back six of what that let Now spreading But capital mostly things of always to slower you'd sense come a we're three the us timing to of and bit little by a It affecting that. little in whatever, question is. they're the like a supply just give so. supply driven midyear, now expenditures, out right chain really capital chains of the things months

through needs the So originally compared of overall expecting. be that sequencing to what flushed we are kind to

given how guidance more? George year and I quarter like now think XH outperformance cushion guidance. bit you and is appreciate one, one be the I just thinking really the of and look by a was just first just this I potential lot And I given is in are that I your that your don't whole thinking, really of full in about, your "cushion" John, out cushion it the Can Are best if we at think very guidance that. And just, you second mean, visibility terms or can limited visibility to implied do. about you or is asking little much beat And it's last may, limited. of guidance? a XQ you, we are flesh clear, look, you there's quarter – think

mean, I so. $X.XX into the the guidance the back gave to for right year sense that I range year we performance of or heading a original go on Yes, at ahead relative

little Now the it's end, a because of had wider up top picked have a a $X.XX we now I'm range. we bit range a sorry, $X.XX

quarter. achieved our of first So, haven't really range, as in what else done balance is based of we've the we've what we year. guidance it the top end we've rebased think about increased the for We the upon anything

that demand in we're momentum, ability sales the degree capacity get be able generate creep continue good there's to So the to business but about. we probably to uncertainties to Yes, the see some volume. also more to the that to upside has there's the and talking that, solid all

a just different place. of there's slew in variables So

be we're particular going elements or guidance update next would of we're closer as will we on macros, and uncertainties and work cushion just months, can pretty the that not. I we'll performance the it's more we midyear. get a think the telling have to that there's those harder of through to positive is that but to incrementally the several on the to that So say I operating identify control, All things

Thanks John. so much,

from Mayers Jay from comes question next Goldman Sachs. Your

Your line open. is

you taking Hey, time the for good morning, everybody. Thank in me here. squeezing and

on delay funding that Congratulations the to think balance me of source. wondering sheet. quick one if kind on help first regards coming close me Just of all the term settlement. can to from through With million one draw Paddock just $XXX you here loan, the

drawn short all, of an and you is option it for then So now first if it's maturity. even of relatively right kind

et some around So that asset becomes of curious part versus if capital permanent the you a Thank can help kind me of cetera? considerations CapEx, you. how about think sales, structure

within Yes, intent draw is, the draw use and end we extends BCA, has our that so it of fund would we your the delayed our and when XXXX. -- to Paddock delayed a point complete to it, to be and

So to debt. we and refinance on would to a longer-term long-term have address half, to basis. something able a into be over a that year we that Ultimately look

the course, we point you more continue Of the brought at do portfolio in. same coming token, cash to our optimization, is

to million couple You we $XXX a come. have more still know,

draw, And mention looking and that the delayed the we'll totality of rebalancing so, here, the and be in the rest at not things inflows to the of flows the of that cash of business.

those the sometime see balance through come the we but expect likelihood, be how markets in too. in to flows those sources over the all So year active cash let's other of capital would

Thank helpful. Very very you much.

I more think question. we time one Jillian, for have

Sure.

Anthony Your from Citi. from last question comes Pettinari

open. Your is line

is Hi actually for for volume new XXXX. in Thanks Bryan for this guidance Anthony. sitting the growth Burgmeier

year? is then spoken Just volume given growth level of on supply this that there cap little XQ a for of on And can bit? that about, flat volume that some be see constraints half, could O-I the explain and growth level a you've the in based XQ implying of to seen growth already second you your of for I'm kind guidance just the or it negative seems dynamic wondering if the

and we first have continue Canada. One is it's that sensors the into inventories, already the in for incremental market supply, we quite now which then impactful, have capacity and And Liner large so storm to which productivity, year. we have Inventories, in in increased is the the projects is will that's the well. depending [indiscernible] more [ph] support are implemented year, Uri incremental the a available incremental sources this one. demand we quarter, multiple two not year, project quite last and available, us in we that. available Yes, we're to going on so and repeat exiting project just impact having on get but of to work of

add couple a Yes, I I I could there. context think mean, more

increased equal the first and look One winter our rebound It just come fell into our level of that's size. at production of increased was buckets Uri If you for three productivity storm gone. that in the X.X%. quarter was

that the about, capacity other third the is third efficiency and The one increased achieving. but Andres other that one speed talked been that is we've

of more able the to be sales be as that inventories. able well how that can mean say efficient well to with to probably incremental out how So your I enduring to biggest headwind we we deliver benefit, is -- as deliver on more, be element -- there, incremental

us from in is that large for returnable Got it. U.S. glass beverage the a now. me, historically that used producer Can detail. question a pilot hasn't Thanks remind Last conducting really you just glass right from from compare comes say the perspective, right? do a of glass? what to of percent of how economics one-way economics returnable possible it your glass portfolio to the glass returnable And wise is current

in markets at the develop. this the I is America, mentioned in market, in Yes, so the States. Brazil which is are not we're does them multiple because increasing before, perspective United to it's customers presence in for States, watch got We our glass the emphasis some the point, large incremental returnable consumers, higher to see inflation interest the glass of has there to and for too. seeing the But those because better it markets. it United returnability returnable very best better like affordability they market, in Latin available it makes There because closely pilots as option trips is in in from on how

no there everyone returnable sustainability a from standpoint, to Now beats by else margin. large better is glass. It package very than a

the the baseline the $X.XX all over, the of that out consumption trips marketplace, on aluminum, to well it's touch but the plastic, cleaning in $X.XX. a mean, They're XX bottle you be these and Yes, is collection returnable you're that market XX whether well there like depending glass, know, well, just to unit of that let's you you can pre with economics underscore and and say and bottles but lifes, in, times use bottle I just below a on stuff item for could usually a make whatever. obviously, it equivalent that. below anything even there, costs

Got it, thanks a lot.

Okay, call Please choosing sustainable in glass. a a second glass, note, is That memorable you. And it safe, X. guys so concludes better our scheduled earnings tastes make our it call. quarter moment healthy by for August and thanks. remember, Thank

today's concludes call. joining. you all for conference This Thank

now disconnect. may You