Slide 1: 4Q22 Capital Markets Presentation
4Q22 CAPITAL MARKETS PRESENTATION NOVEMBER 30, 2022
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” or the “company”) within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended.
Slide 3: At a Glance
AT A GLANCE DIVERSE ATTRACTIVE PRODUCT PORTFOLIO CUSTOMER BASE 33% beer 20% wine 18% food 15% spirits 14% NAB 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 profitab
Slide 4: Attractive Investment Opportunity
AT T RACT IV E INV EST M E NT OPPORT U NIT Y SUSTAINABILITY Glass is Set to Win in the BREAKTHROUGH New Green Economy INNOVATION MAGMA Creates a New PROFITABLE Paradigm for Glass GROWTH Strongest Glass Fundamentals in 20+ yr AGILE EXECUTION Bold Transformation and Delivering on Commitments REDUCE RI
Slide 5: Reduce Risk Profile
REDUCE RISK PROFILE Resolve Legacy Liabilities and Improve The Balance Sheet REDUCING FINANCIAL LEVERAGE 1 6.0 Fair and Final Resolution of Legacy Asbestos Liabilities in July 2022 5.0 Eliminating Net Unfunded Pension Position by 2024 4.0 (Leverage Ratio) Mid 3s Low 3s Completed $1.5B Portfolio Opti
Slide 6: Bold Transformation and Delivering on Commitments
AG ILE EXECUT IO N INCREASE SUPPLY CHAIN EFFICIENCY BOLD TRANSFORMATION AND ENABLE A MORE FLEXIBLE, SCALABLE 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: Strongest Glass Fundamentals in 20+ Years
PROFITAB L E GROW T H Strongest Glass Fundamentals in 20+ Years PROJECTED GLASS GROWTH (SOURCE: EUROMONITOR PER UNIT CONSUMPTION PROJECTIONS 2023-2025) ▲ Structural shifts in LatAm: Premium products, brand localization, one way/returnable mix 5.0% ▲ North America mix improvement: O-I shifting away f
Slide 8: O-I Leveraging Strong Glass Fundamental to Expand the Business
PROFITAB L E GROW T H O-I EXPANSION PLAN: 2022 – 2024 • Enables ~ 600KT (5% - 6%) Growth • ~ $630M Investment, $110M EBIT Run Rate, ~ 20% IRR O-I Leveraging Strong Glass Fundamental to Expand the Business O-I VOLUME GROWTH (IN TONS, ADJUSTED FOR DIVESTITURES) 8% CAGR ‘16-YTD22 6.2% 6% O-I Consolidat
Slide 9: MAGMA Creates a New Paradigm for Glass
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 PARADIGM
Slide 10: First MAGMA Greenfield in Kentucky Will Be a Showcase Plant
F I R S T M A G M A G R E E N F I E L D I N K E N T U C K Y W I L L B E A S H OW C A S E P L A N T MAGMA MELTER CUSTOMER ENGAGEMENT CENTER Small, Incremental Growth, Flexibility, Sustainability Customer Intimacy, Collaborative Innovation MODULAR BATCH SYSTEM NEAR-LOCATED Fast and Agile for Greenfiel
Slide 11: Our Sustainability at a Glance
Excerpts from O-I’s Updated OUR SUSTAINABILITY AT A GLANCE Sustainability Report Available at O-I.com GHG EMISSION REDUCTION Our Sustainability Scorecard RECYCLING COLLECTION SITES (27 TOTAL): OUR COMMITMENT OUR PERFORMANCE (by 2030) (2021) Reduce GHG emissions 25% 13.5% GHG emission reduction 9 Ope
Slide 12: 2022 Key Objectives
2022 KEY OBJECTIVES Delivering on O-I’s Transformation Commitments PRIORITIES 2022 KEY OBJECTIVES PROGRESS MARGIN Higher selling prices offset PY unfav Net Price and 2022 inflation ▲ Fav 3Q22 Net Price, on track to exceed FY22 guidance EXPANSION ≥ $50M margin expansion initiative benefits ▲ > $6
Slide 13: Improving Business Outlook and Expect Continued Progress in 2023
DELIV ERING ON OUR COMMIT M ENT S Improving Business Outlook and Expect Continued Progress in 2023 FY22 THEMES FOR FY23 FY24 Outlook as of 11/1/22 As of 11/1/22 Targets from Sept 28, 2021 I-Day Volume1 Growth Approximately +1% Flat or Slight Growth 1-2% CAGR 2022-2024 Earnings (aEPS2) $2.20 - $2.25/
Slide 14: Capital Allocation Principles
CAPITAL ALLOCAT ION PRINCIPALS • Complete MAGMA development and grow glass volumes consistent with underlying glass market demand • Target net debt to EBITDA leverage < 3x over next few years • Evaluating return of excess cash to shareholders 14
Slide 15: Resilience Amid Elevated Macro Volatility
RESILIENC E AMID ELEVAT ED MACRO VOLAT ILIT Y ▲ Improving balance sheet and fair and final resolution of legacy asbestos liabilities ▲ Stable Food/Beverage end markets that are more resilient amid recession cycles (US mega beer 3% of vol) ▲ Oversold positions in Europe and Latin America mitigate pot
Slide 16: Conclusion: Compelling Investment Thesis
CONCLUSION COMPELLING INVESTMENT THESIS ▲ CLEAR STRATEGY TO CREATE VALUE ▲ DELIVERING ON KEY TRANSFORMATON INITIATIVES ▲ IMPROVING BUSINESS OUTLOOK ▲ CONTINUED PROGRESS IN 2023 ▲ RESILIENCE AMID ELEVATED MACRO VOLITILITY ▲ O-I REPRESENTS AN ATTRACTIVE INVESTMENT OPPORTUNITY O-I is aggressively addre
Slide 17: Appendix
APPENDIX
Slide 18: O-I ESG Goals
O-I ESG GOALS Increase recycled content to 50% Reduce the amount of natural average by 2030. O-I is taking a resource used and reduce the We are committed to reducing tailored approach to increase generation of waste by reuse our global water usage 25% by recycled content rates across its and recycl
Slide 19: Segment FX Impact on Earnings
SEG M E NT FX IMPACT ON EARNING S APPROXIMATE ANNUAL IMPACT ON FX RATES AT KEY POINTS EPS FROM 10% FX CHANGE Oct 31, AVG AVG 2022 3Q22 3Q21 EUR 0.19 EUR 1.00 1.00 1.18 MXN 0.05 MXN 19.82 20.19 20.16 BRL 0.02 BRL 5.29 5.23 5.23 COP 0.01 COP 4,824 4,434 3,829 19
Slide 20: 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 21: Additional Reconciliations: Reconciliation to FCF & Adjusted FCF
ADDIT IONAL RECONCILIAT IONS RECONCILIATION TO FCF & ADJUSTED FCF The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measures, free cash flow and adjusted free cash flow, for all periods after December 31, 2022 to its most directly comparable U.S. GAAP fin
Slide 22: Reconciliation to Financial Leverage
R E C O N C I L I AT I O N TO F I N A N C I A L L E V E R AG E $ millions 2019 2020 2021 Earnings (loss) from continuing operations $ (379) $ 264 $ 165 Interest expense (net) 311 265 $ 216 Interest income 9 5 $ 7 Provision for income taxes 118 89 $ 167 Depreciation 390 369 $ 356 Amortization of inta
Slide 23: Reconciliation to Adjusted Earnings and Adjusted Earnings Per Share
A D D I T I O N A L R E C O N C I L I AT I O N S RECONCILIATION TO ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measures, adjusted earnings and adjusted earnings per share, for the year ending Decembe