Q4 2023 Ardagh Group SA Earnings Call
Please standby were about to begin.
Welcome to the Argo Group S. A fourth quarter 'twenty to 'twenty three results Conference call. Today's conference is being recorded at this time I'd like to turn the conference over to Mr. Herman Trotsky Chair of Art All group. Please go ahead.
You're very much welcome everybody and thank you for joining us for <unk> fourth quarter and full year 2023 Bondholder call earlier today, we released our results for the quarter and I'm joined on this call by John Sheehan, CFO and Brian Mike D. A C E O of glass packaging.
Right to taking your questions, we will make some opening remarks on the quarter and our outlook for 2024.
Remarks will include certain forward looking statements. These reflect circumstances at the time, they made and the company expressly disclaims any obligation to update or revise any forward looking statements actual results or outcomes may differ materially from those that may be expressed or implied due to a wide range of factors.
<unk> 'twenty to 'twenty three bundle. The report can be found on our website at auto group Dot com.
Although a metro packaging or A&P released its fourth quarter results earlier today and a replay of its earnings call can be found at auto metal packaging Dot com.
Will not be providing any additional information regarding A&P on this call.
So moving to review some auto group highlights for the quarter.
Group revenues up to $2 billion represented a reduction of 2% compared with the fourth quarter of 2022 on a constant currency basis.
Revenues reflected higher shipments in metal packaging and the pass through of increased costs in glass packaging more than offset by the impact of lower lost shipments compared with the same period last year.
Group adjusted EBITDA of $243 million in the quarter was 26% below the same period last year with reductions of 43% in glass packaging and 9% in metal packaging both at constant currency.
You're being quarterly segmental performance with a focus on constant currency results.
Now by recapping on a M P.
Revenue up $1.1 billion increased by 2% compared with the fourth quarter of 2022.
This reflected 2% higher beverage can shipments with strong growth.
14% in the Americas more than offsetting 10% lower shipments in Europe, where demand remains soft and impacted by customer destocking in excess of retail trends.
Ooh, Yeah, 2023, global beverage can shipments increased by 5% again, driven by growth in the Americas of 11%, which offset a 2% reduction in Europe.
Adjusted EBITDA of $148 million was 9% below the same period last year.
Ooh, Yeah, 2023, adjusted EBITDA was $600 million.
A&P continued to drive network efficiency recently rationalizing the legacy steel lines in Germany, and closing the Whitehouse, Ohio plant.
Cash generation remains strong with a significant reduction in working capital in 2023.
Leverage at year end was five five times last 12 months adjusted EBITDA.
With cash and liquidity of over $800 million.
Do you find out turn to glass packaging, where fourth quarter conditions remain challenging but overall in line with our October 2023 expectations.
Global glass packaging revenue fell by 6% to $1.08 billion in the quarter compared with the same period last year as the pass through of higher input costs was more than offset by lower shipments.
Total glass shipments for the quarter were 20% below year ago levels.
Europe and Africa was down 24% measured against the very strong comparable with North America lower by 13%.
During the quarter, we saw continued destocking by our customers as they responded to weaker consumer demand.
It also reflected the focus on unwinding inventories as supply chain pressures eased.
This was felt particularly in Europe as 2022s fears over energy security subsided.
Our North America business Destocking was exacerbated by disruption to a major beer brand from April 2023 onwards.
In response to weaker customer demand, we reduced fourth quarter global production by almost 30%.
Ensuring that we entered 2024 with appropriate inventories.
Weaker demand and good tile production significantly impacted glass packaging adjusted EBITDA.
Each fell 43% to $95 million in the quarter compared to the same period last year.
Looking at the performance of our two glass packaging segments for the quarter.
Europe and Africa revenue of $718 million was 2% below the same period last year with the recovery of higher input costs, largely offset by a 24% reduction in shipments.
Shipment declines in the quarter were as expected greater than in prior quarters.
This reflected a very strong finish seen in 2022 in Europe, which had increased by mid single digits ahead of 2023 price increase.
This has followed fourth quarter 2021 shipment growth of 10% over 2020 as Europe emerge from the pandemic and as energy concerns grew from mid 2021.
We continue to view 2023 shipment weakness in Europe, which finished 10% below the lowest level seen in the past 15 years as temporary with declines far exceeding changes in consumption.
We expect to see Destocking complete in the first half of 2024.
Our Africa business performed well in the quarter following softness in the third quarter.
Finished the year ahead of our expectation, but below levels expected at the beginning of the we.
We remain positive on medium to long term prospects for glass consumption in Africa, and our significant investment in new capacity over the past two years positions us to service this growth opportunity.
However, demand and curtailed production resulted in fourth quarter adjusted EBITDA for the Europe, and Africa segment of $75 million, a 48% reduction on the same period last year.
Excluding $27 million out of market energy costs, adjusted EBITDAR of $102 million was 30% below year ago levels.
Despite the significant shipment declines full year 2023, adjusted EBITDA in Europe, and Africa are $543 million increased by 5% compared with the 2022 results pro forma for a full year contribution from console.
In summary, we believe the fundamental outlook for glass packaging in Europe, and Africa has not changed.
2023, so a combination of consumers pressured by inflation at 40 year highs as well as equally unprecedented post pandemic destocking by the CPG industry.
We expect to see a gradual recovery in consumption patterns begin in 2024 with lower packaging input costs affording the opportunity for customers to shift to a more balanced mix of volume and price growth.
We therefore continue to expect that European and African glass packaging demand will grow annually by low single digits and mid single digit percentages, respectively over the medium term.
Revenue of $364 million was 13% lower than the same quarter last year attributable to a 13% decline in shipments.
Full year 2023 shipments declined by a similar amount.
The North American glass market was also impacted by general Destocking in 2023 across most of our end markets.
This was to a lesser extent than in Europe. It was exacerbated by the ongoing disruption to a major U S beer brands that we serve as previously outlined.
In response, we closed two production facilities during the third quarter with unaffected business transferred to other parts of our network.
We also to continue downtime in the fourth quarter.
As in Europe, we expect to see Destocking by our customers in North America complete in the first half of 2024.
Adjusted EBITDA in North America loss declined slightly to $20 million for the quarter and was similarly impacted by production curtailments.
Full year adjusted EBITDA in North America was broadly in line with the prior year.
<unk> significantly lower shipments.
The demand challenges seen in 2023 mask, some commercial and operational progress made over the period.
Our focus remains on optimizing operating performance, improving commercial execution and driving returns from targeted investments across a smaller asset base to generate a gradual recovery in earnings and improved cash flow.
We welcome the recent determination by the U S International Trade Commission to proceed with its investigation of imports of glass.
The wind sector from certain countries on the basis that there is a reasonable indication of harm to the U S glass packaging industry.
This is a market in which we have invested heavily in the past two years.
Despite the demand challenges in 2023, we continue to progress on important milestones along our sustainability roadmap.
Our nextgen hybrid furnace ramped up successfully enabling a 60% reduction in C O two emissions.
Customer feedback and interest in this investment has been extremely positive.
In late 2023, we entered a 10 year agreement in respect of a large wind energy project in Europe.
40% of our European glass electricity needs raised.
Raising our renewable electricity share to over 80% once this comes on stream.
Large scale solar projects were completed in two facilities in the Netherlands.
With similar projects planned in North America, and South Africa.
In recycled materials or Cullet usage was maintained at high levels and we continue to seek opportunities to grow long term call it supply.
Through our investments and actions over many years, we are and remain committed to being a sustainability leader in our industry.
Moving to liquidity and capital structure.
Our consolidated cash and available liquidity was $1 5 billion at December 31, 2023, and included <unk> 7 billion in cash.
Total cash and available liquidity at the August restricted group was zero point $7 billion.
Net leverage at the August restricted group was six six times LTM adjusted EBITDA at December 'twenty, 'twenty, three or a.
Format for $27 million of out of market energy costs.
This was in line with the mid sixes that we guided in October.
LTM adjusted EBITDA at the August restricted group was $932 million at December 2023 pro forma for those energy costs.
This represents a 4% increase compared with adjusted EBITDA of $893 million in 2022, which was pro forma for a full year contribution from the console acquisition.
This was achieved despite the reduction in global glass shipments up 18% in 2023.
We manage the unprecedented demand volatility in the past year, our focus has moved to our capital structure since late 2023.
This review is ongoing and we will update in due course.
We ended the year with good liquidity and have the benefit of an attractive maturity profile with low and 95% fixed interest rates.
Given the environment leverage ended 2023 above our initial targets.
Looking to 2024, and having completed our growth investments we are focused on deleveraging our business.
Turning now to 2024.
Macroeconomic uncertainty remains a feature of most of our markets, but we expect to see a gradual recovery in glass shipments as Destocking is completed and.
And as consumers see some benefit from the easing of inflation pressures.
From April we will significant beer market disruption, which affected our business in North America in 2023.
The continued downward drift in energy prices in Europe will support the competitiveness of the glass substrate, both our customers and end consumers, while our own cost position has also reset relatively favorably.
Expect to continue to take production downtime in 2004 weighted to the first half, but on a more cost effective basis than in 2023.
And we continue to relentlessly focus on our cost reduction actions.
Earlier today A&P guided to 2024, adjusted EBITDAR growth of 5% to 10% compared with the $600 million in 2023.
We project 2020 for glass packaging, adjusted EBITDAR of $750 million to $780 million weighted to the second half of the.
First quarter earnings will be lower year on year, given the very strong 2023 comparable when we benefited from running full production to rebuild inventories and from the lag recovery of 2020 to input costs.
Assuming unchanged A&P dividends.
I'll get restricted group 2024, adjusted EBITDA is projected to be $955 million to $985 million.
Following completion of our investment program capital expenditure will be significantly lower than in 2023, and we expect to end 2024 with leverage of around six two times adjusted EBITDA.
In line with the lower first quarter 'twenty 'twenty four earnings net leverage at the end of the first quarter will increase before declining in the second half of the year.
Having made these opening remarks, we will now be pleased to take questions that you may have.
Thank you if you'd like to ask a question. Please press star one on your telephone keypad. If you are using a speaker phone. Please make sure. Your mute function is turned off to wire signal.
Again press Star one to ask a question, we'll pause for just a moment to allow everyone an opportunity to signal for questions.
And we'll go first to Roger Spitz with Bank of America.
Hi, Thanks, very much so you gave for.
For 2024 guidance, you gave 765 or EBITDA midpoint.
200 for I guess for the dividends.
Well.
Can you go ahead of the other items like glass maintenance and growth Capex cash interest lease repayments taxes, working capital restructuring et cetera. Please.
Sure Roger It's John <unk> here, Yes, the guidance, we gave was 50.
<unk> glass operations EBITDA, yes, the dividend that's in and around that $2 5 million between the ordinary in the press.
Working capital, we'd expect to be pretty flat this year and we did have some barrels last year. So.
We expected to be flat Capex total capex should be in around $340 million.
That's largely maintenance, there's a tail of about maybe $20 million or so of them.
Growth Capex, just finishing the project that we had in Africa. So that's overall a reduction of about 200 million versus last year's combined.
Maintenance and growth, which is about $5 40.
Total restructuring spend related would be about.
Yes, the order of about $50 million cash interest at about 340 tax cash taxes something.
50 to 60 range.
Then we have.
The regular dividend to web to the Holdco was about $100 million.
And the lease repayments in or around 100, or so as well so it would lead to net debt broadly flat and the deleverage coming about through.
Yes.
To the EBITDA growth over the course of the year.
Perfect John Thank you would.
Would you be able to <unk> given the consol is EBITDA in prior years.
I know, it's now part of the segment, but would you.
And based on.
Got it can you give 2023, consol EBITDA and how much.
With new third furnace might be an EBITDA tailwind in 2024.
Over $200 million last year as you say, it's part of the Europe and Africa segments. So we don't break it out.
And FX headwinds this year.
So.
There'll be limited progress it had a good year last year with the full contribution from the Nigel to furnace and looking a little farther forward and trading fairness and a full year should add about $20 million.
Great and then.
And the off balance sheet receivables they increased by about $170 million from 281 from $1 31, and December 2022, assuming I did my subtraction correctly.
Is there more room.
To grow this facility and when you gave the guidance of working capital being flat of course that was high but on balance sheet working capital do you expect to see an increase in the off balance sheet receivables.
Taking in particular, Roger Yes, your numbers are right it was up from.
$2 81 in the glass business. Most of this is really customer driven.
The increase really reflects higher selling prices. So the value of your receivables far in light of the price increases over the past couple of years pushes it higher that we.
A bit of seasonality there as well, although as we've said on the call that Q4 seasonally was that was weak as we had indicated but no particular.
Change in visits and as I say most of it is customer driven.
Rather than something that we actively do well.
It's a reasonably attractive.
Source of financing of margins on it are pretty good too.
Absolutely alright, thank you very much John.
We'll go next to Sam Mcgovern with UBS.
Hey, guys good morning.
Prepared remarks, and I think also Paul on the last quarter mentioned, there's some commentary around consumer packaging companies focus more on a balance between price and volume or are you starting to see that conversation shift.
With the consumer products companies are they willing to push as much as price and try to grow volume a little bit more.
Hello. This is Mike yes, yes, we are beginning to see that moving forward. So I think it's certainly been the case last year.
Focus really was around.
We're driving price, but we're now seeing changes with regard to the.
Look from our customers, they're looking a little bit more around volume going forward.
Got it Okay, and then in terms of consumers' reaction to inflation, but obviously inflation slowed but it's still there are you starting to see though that the sticker shock of prices.
Is leaning in that even though prices are still higher consumers are willing to pay more for the various products.
I think what we're seeing is I mean, it's very early member and John just six weeks into the year, but I think we've already seen small signs of some movements in the <unk>.
<unk> profiles and the sectors and it would appear that we are beginning to see some of that movement, but it's again, it's very early at this stage, but I think based on what we're seeing with our dialogues with our customers customer forecast that's coming through.
Got it and then last question for me before I pass it along get you added to the annual report language regarding.
Potentially seeking to refinance or maybe repurchase or extend maturity of the outstanding debt.
Through different things do you have any sense in terms of timeframe. When you might start to address the capital structure or when you might start having conversations with lenders.
No look I think the language as John sheet here, we always update risk factors.
Diluted depending whether it's political conflicts or you name it but.
Our focus last year was around the environment, which was.
Fairly unique for a number of different reasons and we manage that what you said the pro.
Pro forma EBITDA, the EBITDA reported for the full year for glass businesses was higher than the pro forma of 2022 liter and exhibiting the full console.
Having done that through most of last year since the end of 2003, we've been focused on reviewing the capital. So we're very conscious of our maturities.
When they arise we deal with the bandwidth.
Fairly well term debt structure and at low interest rates at fixed interest rates. We also have to evaluate things like prepayments at redemption penalties those kinds of things. So the review is ongoing but we are very conscious aimed at our maturities wouldn't that wouldn't go that would be our aim as well.
Great. Thank you very much that's helpful I'll pass it along.
We'll go next to Sandy Burns with Stifel.
Hi, good morning, everyone and thanks for all the information.
Maybe to follow up on Sam's question about.
Customer plans for the year.
Whether its a b or some of your other larger customers are they talking to you about significant promotions marketing initiatives that they're working on that that they believe they'll need materially more volume from you than they did last year.
Hi, Sandy. Thank you yeah, no, we're not having but nothing specific discussions around what theyre doing on promotions, but as you know the discussions we're having are more around the fact that they are focusing less on price and more around volumes, but they're not talking about any specifics at this stage.
Okay, and then you mentioned you still plan to take some downtime in the first half, but on a more cost effective basis could you elaborate on that is that just at fewer plants or are there. Other actions you take to reduce the cost of that downtime.
I believe what we've done through really Q4 has taken a lot of the downtime at that point and really what we're doing though is as we go through the year, we will phase back some of that production. So we've taken the actions and really.
And the tail end of the second half of 2023.
In the early days.
Sandy a lot of our downtime would have been.
By necessity idling lines, where you're not making any energy savings, but that as we as we move our furnace rebuild program or as we get the benefit of turning some some furnaces often saving.
Energy costs, there as well so.
That's kind of what we're getting.
Okay, and maybe last one for me kind of on that front you mentioned the two plant closures anything else kind of on your radar screen at this point or.
You feel pretty good about the footprint at this point.
Nothing on our radar at this moment, we are happy with the footprint.
Great. Thank you good luck.
We'll go next to Richard Bailin with Deutsche Bank.
Oh, yes, so you mentioned the new.
Energy contract tenure agreement that you signed for.
I think you said, 40% I wasn't sure if that was 40% of the European footprint or the consolidated glass.
Footprint energy needs.
Could you <unk>.
Number is where you stood in terms of total energy costs for 2023, and if I look at the guidance the $50 million to $80 million improvement versus the 2023, how much of that is coming from energy improvements and how much from volume.
Okay.
PPA that we've entered into in respect of a pretty significant wind project and that will be part of our electricity we will.
I think part of our volume impact last year was attributable to we may have been at a disadvantage to some others in terms of energy. So we will see.
Meaning for the energy benefits and reductions coming into 2024, and they will be passed on to customers. So yes, it's a very important cost.
We would be.
Well, if you're expecting double digit price reductions for at FERC customers as we get into the new year.
I guess similar to a M P, which provided a bridge in terms of the 24 versus 23 guidance is there are additional details you can share in terms of the 50 to 80 million improvement, what's coming from volume, but maybe if if average pricing is that the negative factor in 2004.
And what's coming from energy.
Yes, I think.
Yes.
So to say.
Energy they get.
So we won't be losing.
Losing out there and then we would expect to recoup some of the underperformance on volume.
We incurred last year.
Yes.
Just to add to that so we would we would from what we're seeing with regard to the energy movements for us that would be a double digit movement reduction for our customer base as John has already previously said and we see a double digit growth in real terms.
Europe as a result.
Okay, and I guess implicit in the guidance what is the volume expectation for the full year.
In terms of total volumes.
North America were pretty we would be not on any major volume growth.
So we'd be flat will be flat in North America, some growth in both Europe and Africa.
Okay, great. Thank you.
We'll go next to Peter the Lena with BNP Paribas.
Yes, good morning, and good afternoon can you. Please give an update on the North American beer volumes. Your large customer that suffered damage are you seeing any stabilization or recovery in the last couple of months.
So Peter yes.
In reality, what we're seeing is stabilization. So we're certainly not seeing any rebound as such but I think we're seeing a more stable environment moving forward. So I think from that standpoint, that's that's what we're seeing in being forecasted at this time.
Okay and then my follow up question is on Trivium any update on the sales process there.
Okay.
No comments are no update on that maybe you'll have results I think in the first half of March.
Okay, and then sorry, I was just squeeze in one more.
Wanted to ask a question about the dividend from Arda metal packaging I mean, I recognize we're here to talk about Arctic glass, but the dividend for metal package, that's pretty helpful for Arda class cashless.
Based on the numbers, we heard all the metal pack call it sounded like cash flows.
I will not cover the dividend and Capex and lease payments in 2024.
There seems to be plenty of cash at metal pack for the short term, but how do you think about the ability for a battle pack to a service that dividend.
Yeah over the over the long term it through economic cycles.
Okay.
<unk> said in the opening remarks, we're not adding any color on that.
Hey, Adam.
And the guidance that we gave we gave it.
Sort of holding dividends at prior year levels.
<unk> investment program there is.
It's coming to an end so.
Capex out of place.
<unk> deteriorate further.
Okay.
Okay.
Yeah.
We'll go next to it.
With Jupiter asset management.
Hi.
Just a couple of questions.
Where do you see just a full glass.
Packaging, the odd outgrew with Citigroup, excluding metal packaging.
Where do you see them in terms of the minimum cash that you need to operate the business.
That's my first question and then I just wanted to understand.
If the right demand to rebound.
How soon can you restart the facility that you currently kind of stopped it could easily be kind of easy to restart.
The furnaces.
So if you stop production I know, it's kind of this process that takes a little longer time.
And then my final question regarding do you have any indication on that.
David.
The cash interest on the Holdco Pik.
Do you continue.
Do you intend to continue pay that in cash.
Okay.
I'll take the first and the third question. The first one was on the minimum cash look our focus is on liquidity and cash they're interchangeable.
Intents and purposes, so consolidated that and that was $1 5 billion. That's over 50 group that was at <unk> 7 billion at the end of the year. So yes, we have a strong position there and as I said, we have attractive well term Davidson fixed rate low interest coupons on the yen.
Holdco.
Dividend on the toggle notes they are.
They are pay if we can.
If we were to change there we would have to know device. The next coupon payment is in June.
We would have had to live in.
At the end of last year in that respect. So that's the structure I think it is laid out in the.
And the Bondholder reported you are probably familiar with terms, but if that provides us cash and theres always be available then.
Payable in cash.
And then just on the on the <unk>.
Question on the curtailments and the cost or the timeframe to bring them back up I mean in reality.
Curtailments take various forms that can be either in lines.
Placing rebuild programs et cetera, what we've done is we planned out the volumes and.
What we're going to do with the pull back on volumes as we go through the year and with the rebuilds coming through so really it's it's it's short in real terms, but it's dependent on what youre doing with your hub.
Ling lines of rebuilding a furnace that we have that in our planning for that for the volume growth as it comes back in 'twenty four.
Understood. Thank you.
We'll go next to Mark Watts with Citi.
Hey, guys just a couple quick ones one housekeeping just RP capacity could you just update on how much capacity you have.
And then the second one is just on the.
It would be a customer.
In terms of just contract negotiations I know it was flat.
That's kind of the end of last year, how those negotiations are going just because to get some update there.
Hey, Mark on the <unk>, just a little over $1 2 billion.
Our <unk> group.
Yes.
Just on the other question.
With regard to we don't really talk about the customer discussions et cetera, but I would say that we are progressing the discussions satisfactorily.
Okay.
We'll go next to Paul <unk>.
<unk>.
Hi, there. Thanks for taking my question just a couple for me first on the wind ruling how confident are you of the outcome there and can you quantify the benefit is it embedded in your guidance for the year at all.
Sure.
So Paul yes. So.
Look I think we're very much.
I'm pleased with the progression so far we haven't built in any anything into our guidance for this year and I suppose.
Let's see.
With the Navy.
Okay.
He's with.
With the department of Commerce, which is coming out probably in Q2, we will have a little bit more competence, how that goes but initial feeling is it's relatively positive, but again, we'll wait to see how things progress.
Great and then my other question.
Do you have any remaining unprofitable plants and is there further room to reduce fixed costs if needed such as closing. These plants that may have been answered earlier I just want to get a better sense. Thank you.
So our focus really is around operational efficiency and that's what we're focusing on this year.
Really we're looking at we took actions last year regarding two plants and our focus now is to optimize and improve the remaining plants in the network.
Okay, great. Thank you so much.
We will go next to Jay Olson with brace Bird brace bridge capital.
Hi in the annual report it was disclosed that.
Certain directors disposed of artisan Pik toggle notes could you provide any color on the sales and on any remaining holdings.
Yes sure.
I think that was that.
That was filed in the second quarter.
The <unk>.
Farmer, Chairman Hu <unk>.
We disposed of about 25% of that.
All of US holding <unk> was notified so there's been nothing says and retains the other 75% that was just on for personal reasons.
Okay.
Okay. Thank you.
We'll go next to Roger Spitz with Bank of America.
Thanks for the follow up and maybe you've given this information, but I missed it.
You gave the quarterly volume growth overall and by the two segments can you give the 2023 versus 2022 volume growth overall and by the two segments. Please.
Yes in terms of them.
Europe was down for.
For the full year was down about 24%.
And then North America, we said was down.
The 13% in both the quarter and the full year in volume.
Obviously, they're both.
Both North America, and Europe were both down 24, and 13% respectively for both quarter and the year is it just happenstance MRI.
Alright.
Full year, Yes, Europe was down.
Closer to 30% in Q4 in North America was down about 13% in Q4.
Okay I missed that got it.
Very good and I.
I was just.
You said Consol is EBITDA has been 200 yet.
The third furnace and that you expect that over time.
You had sort of a $20 million tailwind.
Just three furnaces versus two furnaces.
Is there something I'm missing in terms of.
Why the third furnace.
Hey, good tailwind going from two to three furnaces for Consol.
Consol has got Tam.
14 furnaces theres all across the network.
That's just one plant so <unk> South Africa, and we've added two furnaces over the past couple of years and the second one just coming onstream, but it's not at 33% or 50% increase in capacity.
Got it and then.
Should should we hit for 2025.
Total capex should we think still along the lines around.
320 or will there be other growth capex.
For 2025.
We're not yet in its 25 at this stage, but I think the asset base pretty well invested so.
Hey.
After 25 wouldn't be seeing any major change we've added some semi.
Capex investments and given the volume trends over the past year Theres room to grow back into that over the next.
One to two years.
So we'd be able to hold that close enough to the to the 24 level in <unk> and 'twenty.
Got it and last one I don't know if you want to give this should not from one of your competitors gave it for their aluminum can.
The final impact for that.
The final nine months from the North American beer disruption and an EBITDA standpoint is that something you'd be willing to provide.
So we would.
Okay.
Alright, Thank you very much.
We'll go next to Ed Brucker with Barclays.
Hey, Thanks for letting me sneak one in here.
Yes.
<unk>.
Thank you.
We've been looking back and when you originally guided to 850.
I guess my question is why.
What's the path back to that $8 50 number is it further volume growth over time and as that sort of a number that we should be thinking about kind of is.
Not like a through cycle EBITDA number.
I think Ed.
Yes.
As we said at the beginning globally, our volumes declined last year by about 18% of the full year.
The EBITDA, we've held its up slightly year on year versus the pro forma this year were given the guidance of 750 780 <unk> yes.
It's very much an attainable level over couple of years.
But specific.
Thanks.
Looking beyond 24 at this point in time, but.
You said the.
European shipments finished the year more than 10% below the lowest that we've seen in 15 years. So there's a lot of room, there to grow and we.
And others take the view that you have.
Structural really has changed in the market there.
Got it.
Yes.
Yeah, Okay perfect. Thank you.
Maybe I'm getting a little greedy here, but any commentary around the first two months of the year, how volume it's been a narrow.
Alright metal gave commentary that it seemed like it was going relatively well. So just if you are able to provide that.
Yes.
Ed.
I would say that the first six weeks have started to plan and in line with expectations.
We are starting off in a good way I think clearly it is the volumes really start to pick up in the in the second half of the year. So therefore, it's just a bit early to tell but I think initially.
We are operating in line with our expectations.
Got it I appreciate the color.
We will go next to Andreas Kristofferson with Nordea.
Yes, hi, good morning, Thanks for taking my questions.
I have a follow up on your answer on <unk>.
You'll have a bump going current here in April 24.
Could you provide any just any insight on.
And what you're considering doing that you're giving guidance of $6 two levers for yearend.
Do you see that sort of refi boom there.
Chris for you.
Yes.
We have nothing to add.
In reviewing our structure over the last couple of months.
Continuing market conditions have improved we ended the year with alright.
Very solid liquidity and.
And cash we have.
Attractive maturity profile with fixed attractive coupons and we also just we have to be mindful of that.
Payment prime yet so, but we're very conscious of our maturities on our aim would be that Tim maturities wouldn't go Cubs.
Nothing more to add at this stage.
Okay. That's noted and also on consumer State you said that was not something that got to discuss but do you see.
Any other inorganic.
You could potentially pull if need be.
I mean in order to decrease decrease to a world that stake.
Do you have any.
Room to add further bank financings.
With the current setup.
Market conditions have.
Improved somewhat over the last couple of months, but there's nothing really to add at this stage.
We continue to review, what's been a very busy year with the operating environment. So it's only over the last.
The months that we turn to the capital structure, but we are very conscious of maturities.
Continue that evaluation.
Okay. Thank you.
We'll go next we will go next to Chris Ryan with Radcliffe.
Hi, Thanks for taking my question I.
I was going to add from a refi, but also on the.
The H two recovery and volumes are that because a competitor of yours sign a similar thing.
What's the confidence on that page to recovery.
Yeah, just what gives you that confidence.
Yes.
I think if you as Jonas said sorry.
I think as John just said look we are looking at the levels in 2023 that were 10% below the lowest levels. We've seen in the last 15 years, we've certainly seen.
Alright interactions that customers a significant level of Destocking and we also had the impact on.
The pull forward from <unk>.
Volumes into 2020 to the tail end of.
Stopped at the end of 'twenty two.
And we've also seen some movements regarding imports.
Imports have been a factor in the mix, which are not there from that standpoint. So so we see a lot of movements going in that direction and with our customer discussions. They are also going through the destocking and see a more optimistic viewpoint on the second half. So again, there's some factors around what happens the tail end of 'twenty two.
What we've seen with imports and the removal of those imports and then just the general movement with regard to the market moving up.
Also with regard to the <unk>.
Customers.
More optimistic around the second half.
Got it.
And do you expect that.
I mean, the commentary on the Destocking was similar for Europe, and Americas. Two do you expect the timing on the destocking to be Sim.
Similar for both both regions Europe and the Americas.
Thanks.
I think you posted to see North America come back a little bit quicker than unit, but I think there'll be very similar I think.
You're really talking about maybe Q2 et cetera, so, but I think I'd say that would be slightly quicker I think in North America.
Yeah.
Yes.
And one more what would be the upside to those volumes.
Recovering earlier or what would be a driver for that.
What could be potentially push it even further.
I think I think is really around the market growth in the consumer and how that goes I think there's clearly.
I would suggest that 2020 was artificial based on the fact, there was a lot of destocking in the process. So the balance will be the normal volumes will be higher but I think it's more about the consumer confidence and how that builds back.
Got it okay. That's all my questions. Thanks.
Our final question will come from LNR, Marta Donnie with seek U S.
Good afternoon, and thanks for taking my questions I have two please first one would you be able to provide the revenue split by <unk>.
The market for Europe, and North America separately for the glass business, how much is beer versus <unk> versus food.
Yes, we've got well in terms of say volume beer.
Kind of mid to high Thirty's.
So it is.
Kind of mid twenties.
Wine and spirits and be tilted towards.
First in our case would be around about 30%.
I will now collect beverage will be.
Kind of high single digits.
78% is that kind of level.
The U S is not SaaS that's.
Similar.
Okay.
Okay.
Bottom line then there is fairness and then South Africa would be faced with the beer.
I think I should say okay perfect.
Secondly, you mentioned that Mr. Colson, so the 25% the resulting in the Pik notes and retain 75% what is the quantum of that.
Please.
Yes, I think approximately.
The retained amount is the art of bad.
42% $43 million.
And that and that space value or.
Nominal market value.
No not at all okay.
Thank you.
Thank you.
At this time there are no further questions I will turn the call back to you Herman for closing remarks.
Alright, thanks, everyone for joining and.
We look forward to seeing you at our next call at the end of April. Thank you.
This does concludes today's conference we thank you for your participation.
Okay.
Okay.
Okay.
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