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| Statement |
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| So, there should be confidence that we can indeed execute what we're putting in front of you, and we have tremendous confidence that we'll be able to execute it |
| So, we have tremendous confidence that by rightsizing to the existing capacity required and demand levels of our customers, as markets recover, as volume grows in Metal Containers and then Custom Containers, will have the ability to meet that demand head on with the adjusted footprint and capacity that we have |
| In Dispensing & Specialty Closures, our high-value dispensing products were a highlight for the quarter with mid single-digit volume growth and a significant mix benefit that more than offset the headwinds we've talked about in food and beverage end markets |
| Importantly, what we learned during the pandemic is that we did have this tremendous ability to surge and flex our cost structure to meet incremental demand |
| Additionally, we believe these cost improvements will help position the company to continue to meet the unique needs of our customers and compete and win in the markets we serve |
| We're encouraged that the percent of product being sold on promotion is going up and approaching at pre-pandemic levels, and we think that will be a benefit for consumers and should, as it always has in the past, drive some volume activity across the segment |
| Demand for our high-value dispensing products remained strong with mid single digit growth for these products during the quarter that drove significant mix improvement for the company overall in the Dispensing and Specialty Closures segment |
| We continue to see recovery in products that experienced post-pandemic destocking last year, and benefited from strong organic growth in our fragrance dispensing products for prestige market |
| Despite these headwinds on volume, the growth in Dispensing products, mix benefit and strong cost management drove record performance for this segment in the quarter |
| Importantly, all market indications we have continue to show that consumer level demand for our products remains robust |
| Those trends will continue next year in 2024, and we anticipate continued growth and mix benefit from the high-value dispensing products, again, irrespective of recovery in food and beverage markets and our other aspects of the business |
| The third quarter delivered strong performance that was consistent with our expectations despite continually challenging market conditions, and we reported our second highest quarterly earnings as our businesses manage their cost proactively to offset softer than expected volumes in the quarter |
| And we anticipate that to provide a benefit to volume when it's fully integrated into the sales cycle for our customers |
| In Metal Containers, we again delivered strong results despite softer-than-expected volumes, customer destocking priorities appear to have expanded to include adjacent categories, including pet food, and many customers are targeting further inventory reductions in categories that we were already anticipating these trends |
| So that level of the relationship has remained very strong, very transparent |
| We believe the continued progress we have made with regard to our strategic priorities in the actions we've taken to effectively manage the factors that are within our control, position the company to return to earnings growth in 2024 |
| We see positive signs in our customers' promotional activity, inventory unit levels trending below historic norms |
| And so we've got good confidence and good line of sight that we do continue to have that growth driver for our dispensing and Specialty Closures segment in 2024 |
| So it's great that it's accelerated |
| Record third quarter 2023 Dispensing and Specialty Closures adjusted EBIT increased $5.4 million versus the record achieved in the prior year period as a result of improvements in mix in the segment due to a higher volume and high-value dispensing products and lower sales in high-volume closures for food and beverage markets as well as effective cost management, including SG&A |
| And we feel pretty good about that |
| But I'll go back to a little bit of what we said earlier that for our high-value Dispensing and Specialty Closures items, we are seeing significant growth in the products that we define as growth products, and that is driving benefit for the company from a mix standpoint |
| And it's a safe means of getting low-cost, high-value nutrition products to consumers |
| Performance in each of our segments was consistent with our expectations, with mid single-digit adjusted EBIT growth driving record results in Dispensing & Specialty Closures, and with Metal Containers adjusted EBIT comparable to the prior year record levels |
| We've got a really good understanding of what our customers are doing |
| We are going to control our own destiny and take good aggressive action to drive earnings growth for 2024 |
| We are winning in the market as well |
| So really, we believe we can control what's immediately in front of us, but cost savings program will drive earnings growth for next year irrespective of market recovery |
| I think we are having success in the market |
| I think the discussion has largely been around what we do as our products provide nutrition to consumers and a tremendous value |
| Statement |
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| The North American fruit and vegetable pack was delayed to late planting and volumes in Europe were below our expectations due to lower fruit yields and the impact of flooding from Greece |
| Fruit and vegetable volumes were below our expectations |
| In Custom Containers, results were below prior year, but consistent with our expectations due to the impact of customer destocking, including the delay in commercialization of new business wins |
| In Custom Containers, lower volume in most categories drove volumes 10% below the third quarter of 2022, which, coupled with lower resin costs on a year-over-year basis resulted in sales 18% below the prior year period |
| We have revised our estimate for full year earnings to reflect deeper and more pervasive customer destocking priorities in the fourth quarter, which has resulted in a lower volume outlook in our Metal Containers in Dispensing & Specialty Closures segments |
| Dispensing and Specialty Closures segment sales declined 2% versus the prior year, excluding a 1% impact from Russia sales, primarily as a result of lower volume mix of 3% |
| But in fairness, that the destocking activity has been a challenge to work with our customers as we head towards year-end |
| Overall, the 2023 crop will be below our expectations as only a small amount of volume will be packed in the fourth quarter despite the late start |
| In our Metal Container segment, sales declined 8% versus the prior year, excluding a 2% impact from Russia sales due to lower volumes across all product categories as customer destocking priorities were more pervasive and impacted adjacent categories with the largest year-over-year decline in the soup category |
| So appreciating maybe just what we're coming on the tail here of a couple of guidance cuts and a little bit of disappointing news |
| Excluding non-recurring sales associated with Russia in the third quarter of 2022, third quarter 2023 sales declined 7% from the record prior year period driven primarily by lower volumes in each of our segments, partially offset by the pass-through of cost inflation |
| As expected, Custom Containers adjusted EBIT declined $11 million as compared to the third quarter of 2022, primarily as a result of lower volumes due to customer destocking and a less favorable mix of products sold |
| Total adjusted EBIT for the quarter of $214.4 million decreased by 4% on a year-over-year basis, with record adjusted EBIT in the Dispensing and Specialty Closures segment offset by lower adjusted EBIT in the Custom Containers and Metal Container segment |
| International food and beverage volumes remained challenged as a result of the increased levels of inflation on premium products, in particular, for Metal Closures on glass packages |
| And this quarter, the fourth quarter, you think is going to be a little bit weak |
| The decline in volume was driven by double-digit declines for higher volume closures for international food and beverage markets, which more than offset record volume and higher value dispensing products, which grew by a mid-single-digit percentage compared to the prior year |
| Adjusted net income per diluted share declined $0.12 from the record achieved in the third quarter of 2022 with higher interest expense of $0.09, non-recurring sales associated with Russia of $0.03, and lower volumes driving the year-over-year decline |
| Metal Containers adjusted EBIT was slightly below the record level in the prior year quarter despite the shortfall in volumes as the business continued to successfully pass through labor and other manufacturing costs, while actively managing our cost structure |
| The last piece of it is, we know for a fact that unit level inventory across our Food and Beverage and certainly our Pet food markets is lower than historic norms |
| And look, I think we are as frustrated with destocking as anybody else's at this point |
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