Ardagh Metal Packaging S.A. - Fourth Quarter and Full Year 2023 Results
|
|
|
|
|
|
Change |
|
Constant Currency |
Fourth Quarter |
|
($'m except per share data) |
|
|
|
|
||
Revenue |
|
1,132 |
|
1,076 |
|
5 % |
|
2 % |
(Loss)/profit for the period |
|
(56) |
|
12 |
|
|
|
|
Adjusted EBITDA (1) |
|
148 |
|
159 |
|
(7 %) |
|
(9 %) |
(Loss)/earnings per share |
|
(0.10) |
|
0.02 |
|
|
|
|
Adjusted earnings per share (1) |
|
0.01 |
|
0.05 |
|
|
|
|
Dividend per ordinary share |
|
0.10 |
|
0.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Full Year |
|
|
|
|
|
|
|
|
Revenue |
|
4,812 |
|
4,689 |
|
3 % |
|
2 % |
(Loss)/profit for the year |
|
(50) |
|
237 |
|
|
|
|
Adjusted EBITDA (2) |
|
600 |
|
625 |
|
(4 %) |
|
(4 %) |
(Loss)/earnings per share |
|
(0.12) |
|
0.38 |
|
|
|
|
Dividend per ordinary share |
|
0.40 |
|
0.40 |
|
|
|
|
"2023 represented a year of transition for our business, as the team navigated a challenging macro demand environment and took decisive actions on our footprint and inventories to position the business for earnings growth in 2024 and beyond. Despite this market context - in particular softer European demand - we achieved record global revenues and shipment volumes, growing by 5%, driven by strong growth in the
Our fourth quarter performance was negatively impacted versus our expectations by weaker than forecast sales volumes and orders in
Our confidence in a stronger performance in 2024 reflects our expectations for improved cost absorption due to our contracted pipeline of volume growth in the
- Global beverage can shipments grew by 5% for the full year versus the prior year, which was driven by growth of 11% in the
Americas with stronger second half momentum. European volumes declined by 2%, reflecting weakness in the second half. - Global beverage can shipments grew by 2% in the quarter versus the prior year quarter, which was driven by growth of 14% in the
Americas reflecting continued strong growth inNorth America and a further recovery inBrazil , which also lapped a weak prior year comparable. European shipments declined by 10%, below expectations, reflecting a sharp contraction towards the end of the quarter as customers destocked into year-end and closed production facilities earlier than usual for the holiday period. - Americas Adjusted EBITDA for the quarter increased by 3% to
$117 million as the contribution from higher volumes was partly offset by higher operating costs. - In
Europe , Adjusted EBITDA for the quarter decreased by 31% to$31 million due to lower volume/mix and increased fixed costs, as finished goods inventory was right-sized – earlier than expected in response to customer demand – resulting in higher fixed cost under-absorption from reduced production activity and a lower period end contract asset balance. The impact offset stronger input cost recovery versus the prior year and currency effects. - Remain committed to balancing AMP's network capacity with demand, through a mix of curtailment and longer-term action as appropriate. Remaining steel lines in
Weissenthurm, Germany were closed at the end of the year. The closure of theWhitehouse, Ohio facility inFebruary 2024 and expected growth will improve utilization inNorth America to a more balanced position. - Total liquidity of
$812 million , including cash of$443 million , atDecember 31, 2023 was boosted by a further working capital improvement versus expectations. Record cash inflow for the year from operating activities includes a$270 million working capital inflow more than offsetting a prior year$202 million outflow, predominantly from destocking. Working capital in 2024 is expected to see a further inflow. - Growth capex of
$266 million in 2023 was 10% lower than guidance and declined by 45% on the prior year. Growth capex of approximately$100 million is expected in 2024, with a further reduction anticipated in 2025. Near term investment comprises the tail-end of the growth investment program, and flexibility enhancements to optimize the network. - Net leverage reduced by 0.2x during the quarter through strong cash conversion. Modest deleveraging anticipated in 2024 through Adjusted EBITDA growth and lease principal repayments, with a more meaningful reduction thereafter.
- Regular quarterly ordinary dividend of 10c announced. No change to capital allocation priorities.
- During the quarter, the publication of the 2023 sustainability report highlighted progress on sustainability initiatives and the announced supply agreement with Novelis in
North America for supply from its greenfield development will further contribute towards AMP's metal decarbonisation strategy.Ardagh Metal Packaging alongside other industry stakeholders also participated in a call for action atCOP28 .
2024 outlook:
- Shipment growth approaching a mid-single digit % and full year 2024 Adjusted EBITDA in the range of
$630-660 million . Growth supported by shipments growth with improved fixed cost absorption accelerated by the completion of finished goods destocking and footprint rationalization. - First quarter Adjusted EBITDA in line with the prior year quarter (Q1 2023:
$130 million reported;$129 million at constant currency), with growth expected in theAmericas but withEurope lower, as volume recovery is weighted towards the second half.
Financial Performance Review Bridge of 2022 to 2023 Revenue and Adjusted EBITDA
Three months ended |
||||||
|
||||||
Revenue |
|
|
|
|
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
Revenue 2022 |
|
438 |
|
638 |
|
1,076 |
Organic |
|
(46) |
|
67 |
|
21 |
FX translation |
|
35 |
|
— |
|
35 |
Revenue 2023 |
|
427 |
|
705 |
|
1,132 |
|
|
|
|
|
|
|
Adjusted EBITDA |
|
|
|
|
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
Adjusted EBITDA 2022 |
|
45 |
|
114 |
|
159 |
Organic |
|
(17) |
|
3 |
|
(14) |
FX translation |
|
3 |
|
— |
|
3 |
Adjusted EBITDA 2023 |
|
31 |
|
117 |
|
148 |
|
|
|
|
|
|
|
2023 Adjusted EBITDA margin % |
|
7.3 % |
|
16.6 % |
|
13.1 % |
2022 Adjusted EBITDA margin % |
|
10.3 % |
|
17.9 % |
|
14.8 % |
|
||||||
Year ended |
||||||
|
||||||
Revenue |
|
|
|
|
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
Revenue 2022 |
|
1,963 |
|
2,726 |
|
4,689 |
Organic |
|
22 |
|
57 |
|
79 |
FX translation |
|
45 |
|
(1) |
|
44 |
Revenue 2023 |
|
2,030 |
|
2,782 |
|
4,812 |
|
|
|
|
|
|
|
Adjusted EBITDA |
|
|
|
|
|
Group |
|
|
$'m |
|
$'m |
|
$'m |
Adjusted EBITDA 2022 |
|
200 |
|
425 |
|
625 |
Organic |
|
8 |
|
(36) |
|
(28) |
FX translation |
|
3 |
|
— |
|
3 |
Adjusted EBITDA 2023 |
|
211 |
|
389 |
|
600 |
|
|
|
|
|
|
|
2023 Adjusted EBITDA margin % |
|
10.4 % |
|
14.0 % |
|
12.5 % |
2022 Adjusted EBITDA margin % |
|
10.2 % |
|
15.6 % |
|
13.3 % |
Group Performance
Fourth Quarter
Group
Revenue increased by
Adjusted EBITDA decreased by
Revenue increased by
Adjusted EBITDA increased by
Revenue decreased by
Adjusted EBITDA decreased by
Full Year
Group
Revenue increased by
Adjusted EBITDA decreased by
Revenue increased by
Adjusted EBITDA decreased by
Revenue increased by
Adjusted EBITDA increased by
Earnings Webcast and Conference Call Details
Webcast registration and access:
https://event.webcasts.com/starthere.jsp?ei=1650882&tp_key=21f949e6c6
Conference call dial in:
International: +44 330 165 4027
Participant pin code: 3305016
An investor earnings presentation to accompany this release is available at https://www.ardaghmetalpackaging.com/investors
About
For more information, visit https://www.ardaghmetalpackaging.com/investors
Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of Section 27A of the
Non-IFRS Financial Measures
This release may contain certain financial measures such as Adjusted EBITDA, Adjusted operating cash flow, Adjusted free cash flow, net debt and ratios relating thereto that are not calculated in accordance with IFRS. Non-IFRS financial measures may be considered in addition to IFRS financial information, but should not be used as substitutes for the corresponding IFRS measures. The non-IFRS financial measures used by
Unaudited Consolidated Condensed Income Statement for the three months ended |
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Three months ended |
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Three months ended |
||||||||
|
|
Before |
|
Exceptional |
|
Total |
|
Before |
|
Exceptional |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Revenue |
|
1,132 |
|
— |
|
1,132 |
|
1,076 |
|
— |
|
1,076 |
Cost of sales |
|
(999) |
|
(40) |
|
(1,039) |
|
(940) |
|
(20) |
|
(960) |
Gross profit |
|
133 |
|
(40) |
|
93 |
|
136 |
|
(20) |
|
116 |
Sales, general and administration expenses |
|
(66) |
|
— |
|
(66) |
|
(42) |
|
(6) |
|
(48) |
Intangible amortization |
|
(36) |
|
— |
|
(36) |
|
(33) |
|
— |
|
(33) |
Operating (loss)/profit |
|
31 |
|
(40) |
|
(9) |
|
61 |
|
(26) |
|
35 |
Net finance expense |
|
(57) |
|
— |
|
(57) |
|
(46) |
|
22 |
|
(24) |
(Loss)/profit before tax |
|
(26) |
|
(40) |
|
(66) |
|
15 |
|
(4) |
|
11 |
Income tax credit |
|
8 |
|
2 |
|
10 |
|
(4) |
|
5 |
|
1 |
(Loss)/profit for the period |
|
(18) |
|
(38) |
|
(56) |
|
11 |
|
1 |
|
12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)/earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted (loss)/earnings per share |
|
|
|
|
|
(0.10) |
|
|
|
|
|
0.02 |
|
||||||||||||
Unaudited Consolidated Condensed Income Statement for the year ended |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended |
|
Year ended |
||||||||
|
|
Before |
|
Exceptional |
|
Total |
|
Before |
|
Exceptional |
|
Total |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Revenue |
|
4,812 |
|
— |
|
4,812 |
|
4,689 |
|
— |
|
4,689 |
Cost of sales |
|
(4,246) |
|
(92) |
|
(4,338) |
|
(4,096) |
|
(67) |
|
(4,163) |
Gross profit |
|
566 |
|
(92) |
|
474 |
|
593 |
|
(67) |
|
526 |
Sales, general and administration expenses |
|
(241) |
|
(14) |
|
(255) |
|
(189) |
|
(23) |
|
(212) |
Intangible amortization |
|
(143) |
|
— |
|
(143) |
|
(138) |
|
— |
|
(138) |
Operating profit |
|
182 |
|
(106) |
|
76 |
|
266 |
|
(90) |
|
176 |
Net finance (expense)/income |
|
(205) |
|
58 |
|
(147) |
|
(138) |
|
218 |
|
80 |
(Loss)/profit before tax |
|
(23) |
|
(48) |
|
(71) |
|
128 |
|
128 |
|
256 |
Income tax credit/(charge) |
|
7 |
|
14 |
|
21 |
|
(36) |
|
17 |
|
(19) |
(Loss)/profit for the year |
|
(16) |
|
(34) |
|
(50) |
|
92 |
|
145 |
|
237 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)/earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted (loss)/earnings per share |
|
|
|
|
|
(0.12) |
|
|
|
|
|
0.38 |
Unaudited Consolidated Condensed Statement of Financial Position |
|||
|
|
|
|
|
At |
|
At |
|
$'m |
|
$'m |
Non-current assets |
|
|
|
Intangible assets |
1,382 |
|
1,473 |
Property, plant and equipment |
2,628 |
|
2,390 |
Other non-current assets |
154 |
|
94 |
|
4,164 |
|
3,957 |
Current assets |
|
|
|
Inventories |
469 |
|
567 |
Trade and other receivables |
322 |
|
509 |
Contract assets |
259 |
|
239 |
Derivative financial instruments |
12 |
|
38 |
Cash, cash equivalents and restricted cash |
443 |
|
555 |
|
1,505 |
|
1,908 |
TOTAL ASSETS |
5,669 |
|
5,865 |
|
|
|
|
TOTAL EQUITY |
106 |
|
455 |
|
|
|
|
Non-current liabilities |
|
|
|
Borrowings including lease obligations |
3,640 |
|
3,524 |
Other non-current liabilities* |
401 |
|
422 |
|
4,041 |
|
3,946 |
Current liabilities |
|
|
|
Borrowings including lease obligations |
94 |
|
68 |
Payables and other current liabilities |
1,428 |
|
1,396 |
|
1,522 |
|
1,464 |
TOTAL LIABILITIES |
5,563 |
|
5,410 |
TOTAL EQUITY and LIABILITIES |
5,669 |
|
5,865 |
|
* Other non-current liabilities include liabilities for earnout shares of |
Unaudited Consolidated Condensed Statement of Cash Flows |
||||||||
|
|
|
|
|
|
|
|
|
|
|
Three months ended, |
|
Year ended, |
||||
|
|
|
|
|
||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Cash generated from operations (2) |
|
525 |
|
382 |
|
814 |
|
322 |
Net interest paid |
|
(78) |
|
(68) |
|
(174) |
|
(123) |
Settlement of foreign currency derivative financial instruments |
|
(1) |
|
(25) |
|
(10) |
|
41 |
Income tax received/(paid) |
|
(8) |
|
(6) |
|
(14) |
|
(35) |
Cash flows from operating activities |
|
438 |
|
283 |
|
616 |
|
205 |
|
|
|
|
|
|
|
|
|
Cash flows used in investing activities |
|
|
|
|
|
|
|
|
Capital expenditure |
|
(74) |
|
(182) |
|
(378) |
|
(595) |
Cash flows used in investing activities |
|
(74) |
|
(182) |
|
(378) |
|
(595) |
|
|
|
|
|
|
|
|
|
Cash flows (used in)/received from financing activities |
|
|
|
|
|
|
|
|
Changes in borrowings |
|
3 |
|
7 |
|
(4) |
|
599 |
Lease payments |
|
(23) |
|
(19) |
|
(78) |
|
(59) |
Dividends paid |
|
(66) |
|
(130) |
|
(263) |
|
(251) |
Deferred debt issue costs paid |
|
(1) |
|
(1) |
|
(3) |
|
(11) |
Proceeds from share issuance, net of costs |
|
— |
|
(1) |
|
— |
|
257 |
|
|
— |
|
— |
|
— |
|
(35) |
Other financing activities |
|
— |
|
— |
|
— |
|
(1) |
Cash flows (used in)/received from financing activities |
|
(87) |
|
(144) |
|
(348) |
|
499 |
|
|
|
|
|
|
|
|
|
Net increase/(decrease) in cash, cash equivalents and restricted cash |
|
277 |
|
(43) |
|
(110) |
|
109 |
|
|
|
|
|
|
|
|
|
Cash, cash equivalents and restricted cash at beginning of period |
|
154 |
|
583 |
|
555 |
|
463 |
Foreign exchange gains/(losses) on cash, cash equivalents and restricted cash |
|
12 |
|
15 |
|
(2) |
|
(17) |
Cash, cash equivalents and restricted cash at end of period |
|
443 |
|
555 |
|
443 |
|
555 |
Financial assets and liabilities
At |
||||
|
|
|
|
|
|
|
Drawn amount |
|
Available liquidity |
|
|
$'m |
|
$'m |
Senior Secured Green and Senior Green Notes |
|
3,300 |
|
— |
Global Asset Based Loan Facility |
|
— |
|
369 |
Lease obligations |
|
408 |
|
— |
Other borrowings |
|
54 |
|
— |
Total borrowings / undrawn facilities |
|
3,762 |
|
369 |
Deferred debt issue costs |
|
(28) |
|
— |
Net borrowings / undrawn facilities |
|
3,734 |
|
369 |
Cash, cash equivalents and restricted cash |
|
(443) |
|
443 |
Derivative financial instruments used to hedge foreign currency and interest rate risk |
|
21 |
|
— |
Net debt / available liquidity |
|
3,312 |
|
812 |
Reconciliation of (loss)/profit for the period to Adjusted profit |
|||
|
|
||
|
Three months ended |
||
|
2023 |
|
2022 |
|
$'m |
|
$'m |
(Loss)/profit for the period |
(56) |
|
12 |
Less: Dividend on preferred shares |
(6) |
|
(5) |
(Loss)/profit for the period used in calculating earnings per share |
(62) |
|
7 |
Exceptional items, net of tax |
38 |
|
(1) |
Intangible amortization, net of tax |
29 |
|
25 |
Adjusted profit for the period |
5 |
|
31 |
|
|
|
|
Weighted average number of ordinary shares |
597.6 |
|
597.6 |
|
|
|
|
(Loss)/earnings per share |
(0.10) |
|
0.02 |
|
|
|
|
Adjusted earnings per share |
0.01 |
|
0.05 |
Reconciliation of (loss)/profit for the period to Adjusted EBITDA |
|||||||
|
|
|
|
|
|
|
|
|
Three months ended |
|
Year ended |
||||
|
|
|
|
||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
(Loss)/profit for the period |
(56) |
|
12 |
|
(50) |
|
237 |
Income tax (credit)/charge |
(10) |
|
(1) |
|
(21) |
|
19 |
Net finance expense/(income) |
57 |
|
24 |
|
147 |
|
(80) |
Depreciation and amortization |
117 |
|
98 |
|
418 |
|
359 |
Exceptional operating items |
40 |
|
26 |
|
106 |
|
90 |
Adjusted EBITDA |
148 |
|
159 |
|
600 |
|
625 |
Reconciliation of Adjusted EBITDA to Adjusted operating cash flow and Adjusted free cash flow |
|||||||
|
|
|
|
|
|
|
|
|
Three months ended |
|
Year ended |
||||
|
|
|
|
||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
$'m |
|
$'m |
|
$'m |
|
$'m |
Adjusted EBITDA |
148 |
|
159 |
|
600 |
|
625 |
Movement in working capital |
392 |
|
243 |
|
270 |
|
(202) |
Maintenance capital expenditure |
(22) |
|
(35) |
|
(112) |
|
(109) |
Lease payments |
(23) |
|
(19) |
|
(78) |
|
(59) |
Adjusted operating cash flow |
495 |
|
348 |
|
680 |
|
255 |
Net interest paid |
(78) |
|
(68) |
|
(174) |
|
(123) |
Settlement of foreign currency derivative financial instruments |
(1) |
|
(25) |
|
(10) |
|
41 |
Income tax paid |
(8) |
|
(6) |
|
(14) |
|
(35) |
Adjusted free cash flow - pre |
408 |
|
249 |
|
482 |
|
138 |
Growth investment capital expenditure |
(52) |
|
(147) |
|
(266) |
|
(486) |
Adjusted free cash flow - post |
356 |
|
102 |
|
216 |
|
(348) |
Related Footnotes
(1) For a reconciliation to the most comparable IFRS measures, see Page 10.
(2) Cash from operations for the three months ended
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