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By the numbers: Q4 and full-year 2023
Q4 revenue: $1.13B
Up 5.2% year over year
2023 net sales: $4.81B
Up 2.6% year over year
Q4 net loss: $56M
Down from net profit of $12M in Q4 2022
2023 net loss: $50M
Down from net profit on $237M in 2022
- Results: Ardagh Metal Packaging executives described “a year of transition for our business” during a fourth-quarter and full-year earnings call on Thursday. CEO Oliver Graham said notable factors during the year included softer demand in Europe and AMP’s actions to rationalize its manufacturing footprint and inventories “to position the business for growth in 2024 and beyond.” Graham said the company achieved record global revenues and shipment volumes, up 5% year over year in 2023 and up 2% in the fourth quarter.
- Geographic segments: Shipments of cans in the Americas grew 11% across 2023 and 14% in Q4, which executives said reflected continued strength in North America and recovery in Brazil. Graham attributed that performance to customer contract commitments and its diverse portfolio of non-alcoholic beverages, including functional energy drinks. Conversely, European volumes declined by 2% in 2023 and shipments were down 10% in Q4, which the company reported reflected a “sharp contraction” during year-end customer destocking and production winding down amid the holidays. “There was a clear divergence of performance by customer and geography and with a gravitation towards value brands and private label,” Graham said.
- Demand trends: Demand was constrained in 2023 by higher retail pricing and lower levels of promotional activity, Graham said. While consumers remain pressured by factors like inflation, “the decline in shipments experienced by ourselves and the industry was broad-based and significantly in excess of retail scanner trends in the quarter” — a sign of destocking, Graham said. “Scanner trends also showed an improvement in consumer volumes towards the end of the quarter,” he added. January and February this year have so far been a bit better than expected across geographies.
- Footprint optimization: The company will continue to evaluate and balance its manufacturing network, Graham explained, through a mix of curtailment or more permanent, long-term actions. AMP said that two remaining steel lines in Weissenthurm, Germany, closed at the end of 2023. This month, the company closed its two-lines facility in Whitehouse, Ohio.
- Outlook: Overall, AMP expects shipment growth percentage of mid-single-digits, strengthening in the second half of the year. Footprint rationalization and completion of destocking are also expected to help 2024 results, and the company anticipates inflationary pressures will moderate. Adjusted earnings before interest, taxes, depreciation, and amortization is projected to fall between $630 million and $660 million. Growth capital expenditures are projected to continue to decline, with approximately $100 million expected for 2024.
