O-i Glass, Inc. · NYSE:OI
O-i Glass — Q2 2022 Earnings Presentation
22 slides from O-i Glass's earnings presentation, Aug 2, 2022
Slide 1: Second Quarter 2022 Earnings
SECOND QUARTER 2022 EARNINGS AUGUST 2, 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 (the “Exchange Act”) and Section 27A of the Securities Act
Slide 3: Strong Earnings and Achieved Key Strategic Milestones
OV E RV I E W Strong Earnings and Achieved Key Strategic Milestones 2Q22 RESULTS EXCEEDED GUIDANCE AND PRIOR YEAR STRONG YEAR-OVER-YEAR • $0.73 aEPS vs. prior year of $0.54 and guidance of > $0.65 PERFORMANCE IMPROVEMENT • As expected, slight sales volume growth and higher selling prices more than o
Slide 4: Sales Volume Up 0.6% in 2Q22 and 3.3% 1H22
S AL E S VO L UM E T R E N DS Sales Volume Up 0.6% in 2Q22 and 3.3% 1H22 SALES VOLUME TREND (IN TONS, ADJUSTED FOR DIVESTITURES) STRONGEST GLASS FUNDAMENTALS IN 20+ YEARS 25% Rebound from onset of ▲ Structural shifts in LatAm: Premium products, brand localization, one way/returnable mix the pandemic
Slide 5: Delivering on O-I's Transformation Commitments
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 2Q22 Net Price, on track to exceed FY22 guidance EXPANSION ≥ $50M margin expansion initiative benefits ▲ $55M
Slide 6: Revised Capital and MAGMA Plan
R E V I S E D C A P I TA L A N D M AG M A P L A N REVISED CAPITAL EXPANSION PLAN (2022-2024) Revised Plan Better Meets Current Business Environment and Achieves Investor Day Targets POLAND Food (1 Line Extension - 2024) CANADA Premium Beer (1 Line Extension - 2023) UK Spirits MACROS IMPACT CAPITAL A
Slide 7: 2Q22 Results vs. 2Q21
2Q22 RESULTS VS. 2Q21 Earnings Improved Significantly from PY and Exceeded Guidance EARNINGS UP SIGNIFICANTLY FROM PRIOR YEAR SEGMENT AMERICAS EUROPE OPERATING • Favorable net price, sales volume and operating performance ($M Except aEPS and Margins) SEGMENT SEGMENT PROFIT2 aEPS • Elevated costs due
Slide 8: Higher FCF and Lower Financial Leverage
F Y 2 2 F I N AN CIAL P R I O RITIE S HIGHER FCF 1 AND LOWER FINANCIAL LEVERAGE 2,3 Lowest Total Financial Leverage Since 2Q15 (Pre O-I MX Acquisition) FCF $400 264 GUIDING PRINCIPLE 2022 PROGRESS 205 213 $200 112 117 90 101 OPTIMIZE FCF1 and aFCF1 $0 ($M) • Generate ≥ $175M FCF and $400M aFCF in 20
Slide 9: Business Outlook
BUS I N E S S O UT L O O K Increasing Full Year 2022 Earnings and Cash Flow Guidance EARNINGS OUTLOOK (aEPS) 1H 3Q 4Q FY 2021 Actual $0.89 $0.58 $0.36 $1.83 3Q22 OUTLOOK: FX1 (0.05) (0.03) (0.03) (0.11) • Constructive price environment Divestitures2 (0.03) (0.03) (0.03) (0.09) • Flat or slight volum
Slide 10: Russian NG Curtailment Risk
RU S S I A N G C U RTA I L M E N T R I S K EU NG PROFILE BY COUNTRY O-I Well Positioned to Manage Potential Curtailment Risk COUNTRY % RUSSIA NG1 % NG STORAGE2 # O-I PLANTS Czech Republic 100% 76% 2 Hungary 90% 48% 1 EU MANAGING POTENTIAL RUSSIA CURTAILMENT Germany 65% 65% 3 • Actively sourcing more
Slide 11: Conclusion: Compelling Investment Thesis
CONCLUSION COMPELLING INVESTMENT THESIS STRONG SECOND QUARTER RESULTS DELIVERED ON KEY TRANSFORMATON INITIATIVES MANAGING WELL THROUGH MACRO VOLITILITY INCREASED FULL YEAR 2022 BUSINESS OUTLOOK O-I REPRESENTS AN ATTRACTIVE INVESTMENT OPPORTUNITY O-I is aggressively addressing many historic overhangs
Slide 12: Appendix
APPENDIX
Slide 13: O-I ESG Goals
O - I E S G G OAL S 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
Slide 14: Segment FX Impact on Earnings
S E G M E N T F X I M PACT O N E AR N I N GS APPROXIMATE ANNUAL IMPACT ON FX RATES AT KEY POINTS EPS FROM 10% FX CHANGE Jul 31, AVG AVG 2022 2Q22 2Q21 EUR 0.16 EUR 1.02 1.06 1.21 MXN 0.05 MXN 20.27 20.02 19.92 BRL 0.02 BRL 5.18 4.96 5.18 COP 0.01 COP 4,369 3,956 3,733 14
Slide 15: Non-GAAP Financial Measures
N O N - GAAP F I N AN CIAL M E AS 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
Slide 16: Reconciliation to Adjusted Earnings
R E C O N C I L I AT I O N TO A D J U S T E D E A R N I N G S 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 quarter ending September 30, 2022, the quarter ending December 31, 2022 or
Slide 17: Segment Reconciliations
S E G M E N T R E C O N CILIAT IONS 2Q PRICE,VOLUME AND CURRENCY IMPACT ON REPORTABLE SEGMENT SALES 2Q PRICE, SALES VOLUME, OPERATING COSTS AND CURRENCY IMPACT ON REPORTABLE SEGMENT OPERATING PROFIT 17
Slide 18: Segment Reconciliations
S E G M E N T R E C O N CILIAT IONS JUNE YTD PRICE,VOLUME AND CURRENCY IMPACT ON REPORTABLE SEGMENT SALES JUNE YTD PRICE, SALES VOLUME, OPERATING COSTS AND CURRENCY IMPACT ON REPORTABLE SEGMENT OPERATING PROFIT 18
Slide 19: Reconciliation for Segment Operating Profit
R E C O NCILIATIO N F O R S E G M E N T O P E R AT ING P RO F IT 19
Slide 20: Reconciliation to FCF & Adjusted FCF
R E C O NCILIATIO N TO F C F & AD J US T E D F C F 20
Slide 21: Reconciliation for Adjusted Effective Tax Rate
R E C O N C I L I AT I O N F O R A D J U S T E D E F F E C T I V E TA X R AT E The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, adjusted effective tax rate, for the quarter ending September 30, 2022 or the year ending December 31, 2022, to its m
Slide 22: Reconciliation to Total Financial Leverage
R E C O N C I L I AT I O N TO TOTA L F I N A N C I A L L E V E R AG E For all periods after the second quarter of 2022, the Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, total debt less cash plus unfunded pension liability plus the asbestos liabi