Ball Reports Second Quarter 2023 Results

Ball Corporation reported, on a U.S. GAAP basis, second quarter 2023 net earnings attributable to the corporation of $173 million (including a net after-tax loss of $21 million, or 6 cents per diluted share for business consolidation and other non-comparable items) or diluted earnings per share of 55 cents, on sales of $3.57 billion, compared to a net loss attributable to the corporation of $174 million (including a net after-tax loss of $437 million, or $1.37 per diluted share for business consolidation and other non-comparable items, including the non-cash, long-lived asset impairment for the Russian beverage packaging operations) or a loss of 55 cents per diluted share, on sales of $4.13 billion in 2022.

Results for the first six months of 2023 were net earnings attributable to the corporation of $350 million, or $1.10 per diluted share, on sales of $7.06 billion compared to $272 million, or 84 cents per diluted share, on sales of $7.85 billion for the first six months of 2022.

Ball’s second quarter and year-to-date 2023 comparable earnings per diluted share were 61 cents and $1.30, respectively, versus second quarter and year-to-date 2022 comparable earnings per diluted share of 82 cents and $1.59, respectively.

“We delivered strong second quarter results despite lower global volumes driven largely by a U.S. beer customer’s brand disruption and tough year-over-year comparisons associated with 2022 business divestments and higher interest costs,” said Daniel W. Fisher, chairman and CEO.

“Notable inflationary cost recovery, benefits of cost-out actions and a diversified customer mix as well as improved operational efficiencies across all business operations will significantly improve full-year results,” added Fisher. “Following a multi-year period of investment, organic growth and leveraging our team and unique technologies to win an even larger portfolio of mission critical space-based aerospace contracts, additional actions are being assessed real time to further position the business for all stakeholders’ long-term success and accelerate our near-term return of value to Ball shareholders.”

Beverage Packaging, North and Central America, segment comparable operating earnings for second quarter 2023 were $175 million on sales of $1.54 billion compared to $164 million on sales of $1.78 billion during the same period in 2022. Second quarter sales reflect lower shipments and the contractual pass through of lower aluminum costs favorably offset by incremental inflation recovery.

Beverage Packaging, EMEA, segment comparable operating earnings for second quarter 2023 were $98 million on sales of $920 million compared to $129 million on sales of $1.13 billion during the same period in 2022. Second quarter sales reflect lower year-over-year shipments due to the sale of the Russian operations during the third quarter of 2022 and the contractual pass through of lower aluminum costs.

Beverage Packaging, South America segment comparable operating earnings for second quarter 2023 were $30 million on sales of $405 million compared to $52 million on sales of $534 million during the same period in 2022. Year-over-year sales reflect lower volumes and the contractual pass through of lower aluminum costs.

Aerospace segment comparable operating earnings for second quarter 2023 were $54 million on sales of $499 million compared to $36 million on sales of $490 million during the same period in 2022. Backlog remained strong at $2.6 billion, and contracts won, but not yet booked into backlog, finished the quarter at $6 billion, an increase of $1 billion year-to-date.

During the second quarter, Ball Corporation announced that it is considering options that could better position its aerospace business to provide value to shareholders and customers. There is no certainty that any formal decision will be made. If and when appropriate, a further announcement will be made.

“Our teams are doing an excellent job of managing costs and working capital, while also assessing ways to unlock value across all of our businesses,” said Scott C. Morrison, EVP and CFO. “EVA is core to our capital allocation strategy and employing the best positioned, low-cost average invested capital base is key. As a result of multiple disciplined actions over the past 18 months to address costs, capital and growth, we remain well-positioned to deliver free cash flow of approximately $750 million in 2023.

“Looking ahead, the reduction of capital expenditures to depreciation levels will increase free cash flow generation, allow for additional deleveraging and accelerate return of value to shareholders via share buybacks and dividends in 2024 and beyond,” added Morrison.