O-i Glass, Inc. · NYSE:OI
O-i Glass — Q4 2023 Earnings Presentation
28 slides from O-i Glass's earnings presentation, Feb 7, 2024
Slide 1: Full Year and Fourth Quarter 2023 Earnings
FULL YEAR AND FOURTH QUARTER 2023 EARNINGS FEBRUARY 6, 2024
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: Overview: FY23 and 4Q23 Adjusted EPS
FY23 ADJUSTED EPS OVERVIEW $3.50 $3.09 $3.00 Strong Adjusted Earnings in 2023 ~$3.00 $2.50 $2.30 $2.00 $1.50 $3.09 FY23 aEPS , UP 34% FROM PY AND SLIGHTLY ABOVE MGMT EXPECTATIONS $1.00 Highest adjusted earnings in 15 years and best balance sheet since 2014 $0.50 Strong net price realization and
Slide 4: Evolving Market Trends
EVOLVING MARKET TRENDS Recent Softer Macro Conditions Expected to Rebound by Mid-2024 DEMAND TRENDS YoY Change in Consumer Beverage Consumption and O-I Shipments CHALLENGING MACROS DEVELOPED OVER THE COURSE OF 2023 Significant inventory destocking as global supply chains rebalanced Demand Rebounds
Slide 5: FY23: Financial Performance Overview
FY23: FINANCIAL PERFORMANCE OVERVIEW Favorable Performance Across Key Financial Measures +34% +28% +23% +24% 3.09 +280 BPS 688 1,452 1,193 17.1% +4% 7,105 6,856 1,182 960 14.3% 2.30 236 539 3.3x -0.5x 2.8x -45% 130 Net Sales aEBITDA Segment Segment Oper aEPS FCF CapEx LTM Net Debt Oper Profit Profit
Slide 6: FY23: aEPS Up 34% From Prior Year
FY23: aEPS UP 34% FROM PRIOR YEAR Higher aEPS Reflected Strong Segment Operating Profit Improvement Due to Higher Net Price Partially Offset by Softer Volume aEPS SEGMENT OPERATING PROFIT: AMERICAS $4.00 $1,000 Further details included in the appendix $750 472 -10% in tons 511 ($M) 3.09 $500 $3.00 $
Slide 7: 4Q23: Earnings Down From PY As Expected
4Q23: EARNINGS DOWN FROM PY AS EXPECTED Lower 4Q23 Earnings Reflected Strong Net Price Which Was More than Offset by Lower Volumes & Elevated Production Curtailment aEPS SEGMENT OPERATING PROFIT: AMERICAS $0.50 $200 Further details included in the appendix $150 93 ($M) $0.40 0.38 $100 83 -10% in ton
Slide 8: 2023 Strategic Objectives Scorecard
2023 STRATEGIC OBJECTIVES SCORECARD Increasing Margins, Enabling Long-Term Profitable Growth with New Disruptive Technology and Improving Capital Structure PRIORITIES 2023 OBJECTIVES 2023 RESULTS MARGIN ≥ $150M net price realization (excl. margin expansion initiatives) ▲ $632M YTD net price realiz
Slide 9: 2024 Business Outlook
2024 BUSINESS OUTLOOK aEPS Should Meet/Exceed 2024 Targets Set at O-I’s 2021 Investor Day 2024 GUIDANCE EXPECT MODEST TOPLINE GROWTH ACTUAL GUIDANCE LSD/MSD sales volume growth to more than offset slight gross price contraction FY23 FY24 Sales Volume Growth (in Tons) ▼ 12% ▲ LSD/MSD ADJUSTED EPS T
Slide 10: 2024 Key Earnings and Cash Flow Drivers
2024 KEY EARNINGS AND CASH FLOW DRIVERS Initial Volume Recovery and Margin Expansion Initiative Benefits Help Mitigate Lower Net Price and Higher Interest Expense ADJUSTED EPS FCF ($M) $4.00 $1,500 $1,325M - $1,400M $1,400 $3.50 $1,300 $3.09 $1,200 $3.00 $1,100 $2.25 - $2.65 $1,000 $2.50 25% - 27% $
Slide 11: 2024 Key Objectives
2024 KEY OBJECTIVES Strong Margin Expansion Initiative Benefits and Critical Milestone As Commission First MAGMA Greenfield PRIORITIES OBJECTIVES ≥ $150M margin expansion initiative benefits MARGIN EXPANSION Accelerate NA network optimization Successfully commercialize first MAGMA greenfield i
Slide 12: Conclusion and MAGMA
CONCLUSION MAGMA Well Positioned for Expected Volume Recovery Over the Course of 2024 First Greenfield Mid-2024 NAVIGATING WELL THROUGH CHALLENGING MACRO CONDITIONS STRONG 2023 ADJUSTED EARNINGS AND IMPROVED BALANCE SHEET ANTICIPATE STRONGER FUTURE EARNINGS AS MARKETS MORE FULLY RECOVER COMPELLING S
Slide 13: Appendix
APPENDIX
Slide 14: Summary Financial Results: FY23 vs FY22
SUMMARY FINANCIAL RESULTS: FY23 VS FY22 NET SALES SEGMENT OPERATING PROFIT $M except EPS and % AMERICAS EUROPE CORP TOTAL AMERICAS EUROPE TOTAL aEPS 2022 $ 3,835 $ 2,878 $ 143 $ 6,856 $472 $488 $960 $2.30 % Margin 12.3% 17.0% 14.3% FX 136 99 - 235 12 17 29 0.14 Divestitures/Paddock (8) - - (8) (13)
Slide 15: Summary Financial Results: 4Q23 vs 4Q22
SUMMARY FINANCIAL RESULTS: 4Q23 VS 4Q22 NET SALES SEGMENT OPERATING PROFIT $M except EPS and % AMERICAS EUROPE CORP TOTAL AMERICAS EUROPE TOTAL aEPS 4Q22 $ 937 $ 724 $ 32 $ 1,693 $83 $123 $206 $0.38 % Margin 8.9% 17.0% 12.4% FX 46 44 - 90 2 4 6 0.02 SUBTOTAL $983 $768 $32 $1,783 $85 $127 $212 $0.40
Slide 16: Compelling Strategy
COMPELLING STRATEGY Expect to Create Significant Shareholder Value FULL POTENTIAL 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 Comm
Slide 17: Our Sustainability Goals
OUR SUSTAINABILITY GOALS 5 0 % TA R G E T S U P P LY C H A I N S U S TA I N A B I L I T Y Increase recycled content to 50% average by 2030. O-I is taking a Achieve sustainability balance, together, by aligning our supply chain tailored approach to increase recycled content rates across its with our
Slide 18: US Alcoholic Beverage Inventory/Sales Ratio
US Alcoholic Beverage Inventory/Sales Ratio 18
Slide 19: Segment FX Impact on Earnings
SEGMENT FX IMPACT ON EARNINGS APPROXIMATE ANNUAL IMPACT ON FX RATES AT KEY POINTS EPS FROM 10% FX CHANGE Jan 31, AVG AVG AVG 2024 4Q23 4Q22 FY23 EUR 0.25 EUR 1.08 1.09 1.03 1.08 MXN 0.05 MXN 17.22 17.45 19.49 17.62 BRL 0.03 BRL 4.95 4.93 5.28 4.98 COP 0.03 COP 3,909 3,965 4,825 4,268 Current Busines
Slide 20: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES 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 presentation
Slide 21: Reconciliation to Adjusted Earnings
RECONCILIATION TO ADJUSTED 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 year ended December 31, 2024 to its most directly comparable GAAP financial measure, Net earnings att
Slide 22: Segment Reconciliations
SEGMENT RECONCILIATIONS 4Q23 PRICE, SALES VOLUME AND CURRENCY IMPACT ON REPORTABLE SEGMENT SALES 4Q23 PRICE, SALES VOLUME, OPERATING COSTS AND CURRENCY IMPACT ON REPORTABLE SEGMENT OPERATING PROFIT 22
Slide 23: Segment Reconciliations
SEGMENT RECONCILIATIONS FULL YEAR 2023 PRICE, SALES VOLUME AND CURRENCY IMPACT ON REPORTABLE SEGMENT SALES FULL YEAR 2023 PRICE, SALES VOLUME, OPERATING COSTS AND CURRENCY IMPACT ON REPORTABLE SEGMENT OPERATING PROFIT 23
Slide 24: Reconciliation for Segment Operating Profit
RECONCILIATION FOR SEGMENT OPERATING PROFIT 24
Slide 25: Reconciliation to Net Debt Leverage Ratio
RECONCILIATION TO NET DEBT LEVERAGE RATIO For the year ending December 31, 2024, the Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, net debt leverage ratio, which is defined as total debt less cash divided by Adjusted EBITDA, to its most directly
Slide 26: Reconciliation to Adjusted EBITDA
RECONCILIATION TO ADJUSTED EBITDA For the year ending December 31, 2024, 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, because management cannot relia
Slide 27: Reconciliation for Adjusted Effective Tax Rate
RECONCILIATION FOR ADJUSTED EFFECTIVE TAX RATE The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP measure, adjusted effective tax rate, for the year ending December 31, 2024, to its most directly comparable GAAP financial measure, provision for income taxe
Slide 28: Reconciliations to Free Cash Flow
RECONCILIATIONS TO FREE CASH FLOW 28