O-i Glass, Inc. · NYSE:OI
O-i Glass — Citi's 2023 Basic Materials Conference
22 slides from O-i Glass's conference presentation, Nov 29, 2023
Slide 1: 4Q23 Capital Markets Presentation
4Q23 CAPITAL MARKETS PRESENTATION NOVEMBER 2023
Slide 2: Safe Harbor Comments
SAFE HARBOR COMMENTS FORWARD-LOOKING STATEMENTS This presentation contains “forward-looking” statements related to O-I Glass, Inc. (“O-I Glass” or the “Company”) within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 27A of the Securiti
Slide 3: O-I: At a Glance
O-I: AT A GLANCE DIVERSE ATTRACTIVE PRODUCT PORTFOLIO CUSTOMER BASE 33% beer 21% wine 17% food 15% NAB 14% spirits 6,000+ direct customers GLASS IS THE MOST MAGMA SUSTAINABLE PACKAGE reimagines glass making to all natural, endlessly recyclable, support customer aspirations NEVER trash and enable pro
Slide 4: Compelling Strategy to Create Value
COM PELLING ST RAT EGY TO CREAT E VALUE SUSTAINABILITY Integrated ESG Roadmap BREAKTHROUGH INNOVATION MAGMA Creates a New PROFITABLE Paradigm for Glass GROWTH Leverage Favorable Long-Term Mega Trends AGILE EXECUTION Bold Transformation and Delivering on Commitments IMPROVE PERFORMANCE AND REDUCE RIS
Slide 5: Improved Performance and Balance Sheet
IMPROVED PERFORMANCE AND BALANCE SHEET HIGHER EARNINGS LOWER FINANCIAL LEVERAGE 1 3.50 6.0 5.5 ~3.00 3.00 5.0 4.4 2.50 2.30 4.0 Financial Leverage 1 3.5 2.00 1.83 < 3.0 aEPS 3.0 1.50 2.5 1.22 2.0 1.00 2.5 0.50 1.0 0.00 0.0 2020 2021 2022 2023 2020 2021 2022 2023 Longer Guidance 2 Guidance 2 Term Tar
Slide 6: Bold Transformation and Delivering on Commitments
AG ILE EXECUT IO N INCREASE SUPPLY CHAIN EFFICIENCY BOLD TRANSFORMATION AND ENABLE A MORE FLEXIBLE AND DELIVERING ON COMMITMENTS SUSTAINABLE PRODUCTION CAPABILITY INCREASE COST COMPETITIVENESS OPTIMIZE BUSINESS PORTFOLIO AND STRUCTURE BUILD A SIMPLE, AGILE AND EFFECTIVE ORGANIZATION 6
Slide 7: MAGMA: Breakthrough Innovation
M AGMA: B REAK T HRO U GH INNOVAT ION EXPAND RIGHT TO WIN WITH RAPID COLOR, SHAPE & SIZE CHANGES GROW WITH THE MARKET WITH SCALABLE CAPACITY ENTER NEW MARKETS WITH SCALABILITY & LOWER CAPITAL COST EFFICIENT WITH MORE VARIABLE COST STRUCTURE CREATES A NEW AGILE THROUGH ECONOMIC CYCLES & SEASONALITY P
Slide 8: First MAGMA Greenfield Commissioning Mid-2024
FIRST MAGMA GREEN FI ELD COMMISSI O NING M ID-2 0 2 4 First MAGMA Greenfield in Bowling Green, Kentucky will be a Showcase Plant MAGMA MELTER CUSTOMER ENGAGEMENT CENTER Small, Incremental Growth, Flexibility, Sustainability Customer Intimacy, Collaborative Innovation MODULAR BATCH SYSTEM NEAR-LOCATE
Slide 9: Solid Progress on Robust ESG Goals
SOLID PROGRESS ON ROBUST ESG GOALS OUR SBTi target to reduce GHG Reach 40% renewable electricity Increase recycled content COMMITMENT emissions 25% by 2030 use by 2030 and reduce total (interim target of 10% by 2025) to 50% average by 2030 energy consumption by 9% OUR 2022 Reduced scope 1 & 2 30% re
Slide 10: Soft YTD Glass Demand; Expect LSD/MSD Sales Volume Growth in 2024
MARKET TRENDS Demand Impacted by Significant Destocking and Modestly Lower Consumption Expect Rebound Early/Mid-2024 DEMAND TRENDS YoY Change in Consumer Consumption and O-I Shipments Stronger 2H24 as Markets Rebound and SOFT YTD GLASS DEMAND O-I Comps Challenging 2023 Destocking Period Significan
Slide 11: Agility in Action
AG I L I T Y I N AC T I O N Taking Action to Improve Performance STRUCTURAL APPROACH TO IMPROVED AGILITY TEMPORARY PRODUCTION CURTAILMENT Concentrated in 4Q23 to reduce inventory heading into 2024 Capital Breakthrough Structure ACCELERATE PLANNED NORTH AMERICA NETWORK OPTIMIZATION Technology Disci
Slide 12: Business Outlook
BUSIN E S S OUT LOOK ( A s o f N o v 1 , 2 0 2 3 – M a n a g e m e n t i s N o t U p d a t i n g O u t l o o k ) aEPS Up More Than 30% From 2022 and Strongest aEPS Performance in 15 Years FY23 GUIDANCE PRELIMINARY VIEW ON FY24 BUSINESS DRIVERS Currently expect low-to-mid single digit growth Sales Vo
Slide 13: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES IMPROVE FUND RETURN CAPITAL PROFITABLE VALUE TO STRUCTURE GROWTH SHAREHOLDERS ► < 3.0x net debt leverage ► $630M expansion program (2022-2024) ► Anti-dilutive repurchases (2023 guidance) • Partially deferred until capacity utilization improves ► Evaluate dividend ► Glid
Slide 14: Conclusion
CONCLUSION COMPELLING INVESTMENT THESIS 2023 EXPECTED TO HAVE BEST aEARNINGS IN 15 YEARS CONTINUED RESILIENCE AMID ELEVATED MACRO VOLATILITY IMPROVING CAPITAL STRUCTURE AND EVALUATING INCREMENTAL SHAREHOLDER RETURN OVER TIME DISRUPTIVE INNOVATION ON-TRACK FOR START-UP MID-2024 DRIVE PROFIT
Slide 15: Appendix
APPENDIX
Slide 16: 2023 Strategic Initiative Scorecard
2023 ST RAT EGIC INIT IAT IV E SCORECARD Increasing Margins, Enabling Long-Term Profitable Growth with New Disruptive Technology and Improving Capital Structure PRIORITIES 2023 OBJECTIVES 3Q23 PROGRESS MARGIN ≥ $150M net price realization (excl. margin expansion initiatives) ▲ $523M YTD net price
Slide 17: ESG Goals and Performance
ESG GOALS AND PERFORMANCE SBTi target Reach 40% Increase all to reduce renewable Align our Make a 50% Increase aspects of Make glass GHG electricity use Reduce our supply chain improvement recycled Drive towards a Reinvent and diversity, recycling OUR emissions 25% by 2030 and global water with our
Slide 18: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEA S UR E S The company uses certain non-GAAP financial measures, which are measures of its historical or future financial performance that are not calculated and presented in accordance with GAAP, within the meaning of applicable SEC rules. Management believes that its presentat
Slide 19: Reconciliation to Adjusted Earnings
RECONCILIAT ION TO ADJUST ED EARNINGS The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, adjusted earnings and adjusted earnings per share, for the periods ending on and after December 31, 2023, to its most directly comparable GAAP financial measu
Slide 20: Reconciliation to Total Financial Leverage
RECONCILIAT ION TO TOTAL FINANCIAL LEV ERAGE 20
Slide 21: Additional Reconciliations
ADDIT IONAL RECONCILIAT IONS RECONCILIATION FOR ADJUSTED EBITDA For the year ending December 31, 2023, the Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, adjusted EBITDA, to its most directly comparable U.S. GAAP financial measure, net earnings, b
Slide 22: FX Impact on Earnings
FX IM PACT ON EARNINGS APPROXIMATE ANNUAL IMPACT ON FX RATES AT KEY POINTS EPS FROM 10% FX CHANGE Oct 30, AVG AVG 2023 3Q23 3Q22 EUR 0.33 EUR 1.06 1.08 1.00 MXN 0.07 MXN 18.05 16.99 20.19 BRL 0.03 BRL 5.04 4.88 5.23 COP 0.02 COP 4,066 4,023 4,434 Current Business Outlook is Based on FX Rates as of O