CANPACK Reports Third Quarter 2021 Results

November 30, 2021

Krakow, Poland, November 30th, 2021 — CANPACK (the “Company” or the “Group” or CANPACK SA and its subsidiaries and CANPACK US), a global manufacturer of aluminum beverage cans and packaging solutions for the beverage and food industry, is pleased to announce, on a U.S. GAAP basis, with U.S. dollars (defined as “$”) as the reporting currency, its results for the three and nine months ended September 30, 2021 (“Q3 2021”) and its trading update for Q3 and 9M 2021.

Q3 2021 Highlights

  • During the three and nine months ended September 30, 2021, consumers have continued to switch to beverage cans as the preferred option for at-home consumption. CANPACK’s strong volume performance was driven by: (i) all beverage can capacities being sold out due to increased demand in Europe and South America, (ii) increased production volumes from our new Czech Republic facility, which began production in June 2020 and (iii) increased demand from the U.S. customer base, for which we have shipped cans mainly from our facilities in Asia.
  • Net sales increased 21% and 34%, respectively, for the three and nine months ended September 30, 2021. This strong performance was driven by volume increases of 5% and 19% in the Beverage Cans and Ends division and 6% and 22% in the Glass Packaging division for the three and nine months ended September 30, 2021, respectively. Additionally, beverage can net sales have increased for the three and nine months ended September 30, 2021 due to higher LME levels and higher transportation upcharges during the three and nine months ended September 30, 2021 compared to the same periods in 2020.
  • Adjusted EBITDA increased to $148 million for the three months ended September 30, 2021 compared to $136 million for the same period in 2020 (+9%). Adjusted EBITDA increased to $432 million for the nine months ended September 30, 2021 compared to $337 million for the same period in 2020 (+28%). These increases were primarily driven by incremental beverage can volumes.
  • Capital expenditures increased to $117 million and $261 million, respectively, for the three and nine months ended September 30, 2021 compared to $57 million and $205 million for the same periods in 2020. These higher levels of capital expenditures were mainly due to our planned spending for our U.S. greenfield projects in Olyphant, Pennsylvania and Muncie, Indiana, a new can body line in Russia, an extension of our lines in Brazil and in the Netherlands and a new can end line in the United Arab Emirates as compared to capital expenditures during the same period in 2020.
  • Net cash provided by operating activities increased by $44 million to a net inflow of $73 million for the three months ended September 30, 2021 from a net inflow of $29 million for the same period in 2020. This increase in cash provided by operating activities was caused by lower working capital requirements for the three months ended September 30, 2021 as compared to the three months ended September 30, 2020. Net cash provided by operating activities increased by $28 million to a net inflow of $206 million for the nine months ended September 30, 2021 from a net inflow of $178 million for the same period in 2020. This increase in net cash provided by operating activities was caused by higher adjusted EBITDA, partially offset by higher working capital employed mainly as result of higher beverage can bodies volume sales, higher LME and a one-off tax payment recorded as a long-term receivable (see details in Note 7 of the Unaudited Combined Financial Statements for the six months ended June 30, 2021, published on our website).
  • Free cash flow decreased by $10 million to a cash outflow of $27 million for the three months ended September 30, 2021 from a cash outflow of $17 million for the same period in 2020. This decrease was due to higher capital expenditures and higher working capital employed, partially offset by higher adjusted EBITDA during the three months ended September 30, 2021 as compared to the corresponding period in 2020. Free cash flow increased by $10 million to a cash inflow of $21 million for the nine months ended September 30, 2021 from a cash inflow of $11 million for the same period in 2020. This performance was due to higher adjusted EBITDA, partially offset mainly by higher capital expenditures during the nine months ended September 30, 2021 compared to the corresponding period in 2020.

Chief Executive Officer, Roberto Villaquirán, Commented:

“We are pleased to announce positive performance across our business units despite a challenging and disruptive supply chain environment, mainly aluminum. Market dynamics for the aluminum can remain healthy in all regions. Our first two lines at our new U.S. greenfield in Olyphant are up, running, on time and on schedule, demonstrating our proven expertise in delivering greenfield operations successfully.”

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 nearly 8,000 people worldwide and has operations in 17 countries. For more information, visit www.canpack.com.

Conference Call Details

The Company will host a conference call at 14:00 GMT/ 15:00 CET / 09:00 EST on Tuesday November 30th, 2021 to discuss its financial results with the investment community. Investors and analysts wishing to attend this event can request 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

Forward-looking statements can be identified by the use of forward-looking terminology, including, but not limited to, 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 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