CANPACK Reports Full Year 2022 Results

Krakow, Poland, April 6, 2023 – CANPACK (the “Company” or the “Group”), a global manufacturer of aluminum beverage cans and packaging solutions for the beverage and food industry, is hereby providing, on a U.S. GAAP basis, with U.S. dollars (defined as “$”) as the reporting currency, its results for the three and twelve months ended December 31, 2022 (“Q4 2022”) and its trading update for Q4 and Full Year 2022.

Q4 and Full Year 2022 Highlights

  • During the three and twelve months ended December 31, 2022, beverage can bodies volumes grew 7% and 6%, respectively, in comparison to corresponding periods in 2021. In 2022, CANPACK’s volume performance is related to higher sales in the U.S., Europe (excluding Ukraine) and India, partially offset mainly by lower performance in Brazil, UAE (which is cycling 2021 US exports) and Ukraine.
  • Adjusted EBITDA have decreased to $45 million for the three months ended December 31, 2022 compared to $92 million for the same period in 2021 driven mainly by a $13 million aluminum LME time lag impact  as result of sharp decrease in the prices of aluminum quoted on the LME, $12 million ramp-up impact at our plant in Olyphant, PA, $19 million of cost increases not yet fully transferred in selling prices combined with unfavorable fixed cost absorption, and a $3 million unfavorable impact from the depreciation of the Euro against the U.S. Dollar.  Adjusted EBITDA decreased to $383 million for the twelve months ended December 31, 2022 compared to $524 million for the same period in 2021, a decline of 27%, driven mainly by $33 million due to the ramp-up impact at Olyphant, PA, a $31 million aluminum LME time lag impact due to a sharp decrease of aluminum LME quotations, a $26 million unfavorable impact from the depreciation of the Euro against the U.S. Dollar, and $51 million of cost increases not yet fully transferred in selling prices combined with unfavorable fixed cost absorption.

Free cash flow increased by $260 million from a $260 million cash outflow for the three months ended December 31, 2021 to $0 million for the three months ended December 31, 2022. Free cash flow decreased by $74 million from a $238 million cash outflow for the twelve months ended December 31, 2021 to a $312 million cash outflow for the twelve months ended December 31, 2022 due to lower Adjusted EBITDA and higher CAPEX, partially offset by lower Working Capital impact in 2022 vs 2021 mainly due to higher usage of factoring facilities.

Interim Chief Executive Officer, Marius Croitoru, Commented:

“The performance in Q4 2022 was under pressure as a result of a sharp decrease in aluminum LME value, ramp up impact related to our Olyphant facility in the U.S., and cost increases not fully covered by selling price increases.

We expect the operating environment and margins to remain under pressure for the first half of 2023. In the meantime, our balance sheet remains strong with no significant near-term debt maturities until November 2025 and with all existing bonds having fixed interest rates. In addition, we recently strengthened our liquidity by signing a new 5-year committed $400 million senior ABL revolving credit facility which replaces our undrawn prior credit facility.

While the short-term environment is expected to remain challenging, we are optimistic that overall conditions will improve as 2023 progresses, and we continue to focus on activities that will enhance our long-term success.”

About CANPACK

CANPACK Group, part of Giorgi Global Holdings, Inc, is a global manufacturer of aluminum beverage cans and packaging solutions for the food and beverage industries, as well as glass bottles and metal closures. Headquartered in Krakow (Poland), CANPACK employs over 9,000 people worldwide and has operations in 16 countries. For more information, visit www.canpack.com.

Conference Call Details

CANPACK Group will announce its Q4 2022 results on Thursday, April 6, 2023. The company will host a conference call at 14:00 BST / 15:00 CEST / 09:00 EDT to discuss its financial results with the investment community. Investors and analysts wishing to attend this event can request for registration via email at IR@canpack.com or click on the following link.

More detailed financial information can be found on the Company’s IR website at the Financial Results and Bondholder Downloads section (click here to gain access).

Forward-Looking Statements Disclaimer

These forward-looking statements can be identified by the use of forward-looking terminology, including the terms “anticipate,” “assume,” “expect,” “suggests,” “plan,” “believe,” “intend,” “estimates,” “targets,” “projects,” “forecasts,” “should,” “could,” “would,” “may,” “will” and other similar expressions or, in each case, their negative or other variations or comparable terminology.

All statements other than statements of historical facts included in this document, including, without limitation, statements regarding our future financial position, risks and uncertainties related to our business, strategy, capital expenditures, projected costs and our plans and objectives for future operations, may be deemed to be forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties.

We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this document. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate are consistent with the forward-looking statements contained in this document, those results or developments may not be indicative of results or developments in subsequent periods.

Any forward-looking statement that we make in this document speaks only as of the date on which it is made, and we do not intend to update such statements. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future and may not be within our control.

Moreover, the Company operates in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for us to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results.

Non-GAAP Measures

The above press release contains certain financial measures and ratios, including adjusted EBITDA, free cash flow, net leverage, changes in working capital, beverage can bodies volume and capital expenditures, that are not required by, or presented in accordance with, U.S. GAAP (the “Non-GAAP Measures”).

We present these Non-GAAP Measures because they are measures that our management uses to assess operating performance and liquidity, and we believe that they and similar measures are widely used in our industry as supplemental measures of performance and liquidity. These measures may not be comparable to other similarly titled measures of other companies and are not measurements under U.S. GAAP or other generally accepted accounting principles.

Non-GAAP Measures and ratios are not measurements of our performance or liquidity under U.S. GAAP and should not be considered as alternatives to net income or any other performance measures derived in accordance with U.S. GAAP or as alternatives to cash flow from operating, investing or financing activities.

Contacts:

CANPACK IR team

Lorenzo Ruffatti
Group Treasury & Investor Relations Director

Marta Kopcik
Group Communications Manager
Email: IR@canpack.com

CANPACK IR Advisor

Li Zhao – Maitland/AMO
Phone: +44 (0) 207 379 5151
Email: canpack@maitland.co.uk