PR Newswire | Oct 28, 2021 07:04AM EDT

10/28 06:03 CDT

Ardagh Metal Packaging S.A. - Third Quarter 2021 Results LUXEMBOURG, Oct. 28, 2021

LUXEMBOURG, Oct. 28, 2021 /PRNewswire/ -- Ardagh Metal Packaging S.A. (NYSE: AMBP) today announced results for the third quarter ended September 30, 2021.



Three months ended September 30,

2021 2020 ^(1) ChangeConstant Currency

$'m $'m

Revenue 1,038 899 15% 14%

(Loss)/profit for the period (178) 52

Adjusted EBITDA^(2) 176 151 17% 15%

Loss per share (0.32)

Adjusted earnings per share^(2)0.14

Oliver Graham, CEO of Ardagh Metal Packaging, said

"We delivered strong earnings growth in the quarter, with Adjusted EBITDA increasing by 17% to $176 million. AMP's diversified customer base and end markets, as well as our operational agility, served us well in the quarter and enabled us to manage softness in the hard seltzer end market. We are modestly raising our full year 2021 earnings outlook, despite a highly inflationary environment for costs. We are committing to strategic new growth initiatives in the United Kingdom and the southwestern United States as we respond to strong demand for sustainable metal packaging. Both projects involve multi-line beverage can production facilities, with production commencing in 2023 and 2024."

* Revenue growth of 14% at constant exchange rates to $1,038 million, with Americas increasing by 16% and Europe by 11%. * Adjusted EBITDA growth for the quarter of 15% to $176 million at constant currency, with the Americas increasing by 28% as a result of favorable mix. Europe Adjusted EBITDA was modestly higher, reflecting a strong prior year third quarter. LTM Adjusted EBITDA to September 30, 2021 increased to $637 million, from $545 million at December 31, 2020. Adjusted EBITDA margin for the quarter increased to 17.0% (Q3 2020: 16.8%). * Global beverage can shipments were 6% lower in the quarter, of which over 3% was attributable to the residual impact of the cyber security incident. Excluding this, Americas shipments declined by low-single digits, principally due to hard seltzer weakness in North America and some market softness in the winter season in Brazil relative to a strong comparable. In response, AMP successfully pivoted to other stronger-growing beverage markets during the quarter. In Europe, where we are capacity constrained until 2022 pending new capacity coming online, lower shipments reflected a very strong prior year comparable, with growth of 10%. * Specialty cans represented 44% of shipments during the quarter. * Growth investment program largely on track, despite global supply chain challenges, and set to deliver significant additional capacity for 2022 and beyond. Olive Branch (MS) ramp up of two new high-speed lines is well advanced, while Winston Salem (NC) can lines will commence production around year end. Huron (OH) brownfield facility to begin ends production later this quarter, with can production commencing in early-2022. Third quarter growth investment spend of $121 million. * Strategic additional growth initiatives planned in the United Kingdom and the southwestern United States. Both projects involve multi-line beverage can production facilities, with production commencing in 2023 and 2024. * Total liquidity in excess of $0.8 billion at September 30, 2021, including a newly executed $325 million ABL facility. * Full year 2021 Adjusted EBITDA to be at least $660 million compared with the previously-guided at least $654 million.

Financial Performance Review



Bridge of 2020 to 2021 Revenue and Adjusted EBITDA



Three months ended September 30, 2021



Revenue EuropeAmericas Group

$'m $'m $'m

Revenue 2020 421 478 899

Organic 48 77 125

FX translation 14 - 14

Revenue 2021 483 555 1,038



Adjusted EBITDA EuropeAmericas Group

$'m $'m $'m

Adjusted EBITDA 2020 73 78 151

Organic 1 22 23

FX translation 2 - 2

Adjusted EBITDA 2021 76 100 176



2021 margin % 15.7% 18.0% 17.0%

2020 margin % 17.3% 16.3% 16.8%



Nine months ended September 30, 2021 ^(1)





Revenue EuropeAmericas Group

$'m $'m $'m

Revenue 2020 1,201 1,357 2,558

Organic 97 228 325

FX translation 85 - 85

Revenue 2021 1,383 1,585 2,968



Adjusted EBITDA EuropeAmericas Group

$'m $'m $'m

Adjusted EBITDA 2020 197 208 405

Organic 16 62 78

FX translation 14 - 14

Adjusted EBITDA 2021 227 270 497



2021 margin % 16.4% 17.0% 16.7%

2020 margin % 16.4% 15.3% 15.8%

Review of the three months ended September 30, 2021

Group

Revenue in the three months ended September 30, 2021 increased by $139 million, or 15%, to $1,038 million, compared with $899 million in the three months ended September 30, 2020. The increase in revenue is primarily driven by favorable volume/mix effects, which includes an impact of the Group's growth investment program and the pass through to customers of higher metal costs and favorable foreign currency translation effects of $14 million.

Adjusted EBITDA in the three months ended September 30, 2021 increased by $25 million, or 17%, to $176 million, compared with $151 million in the three months ended September 30, 2020. The increase was primarily driven by favorable volume/mix effects, which includes an impact of the Group's growth investment program and favorable foreign currency translation effects of $2 million. Included within Adjusted EBITDA in the three months ended September 30, 2021 are losses and incremental costs relating to the previously-reported cyber security incident of $11 million ($7 million in Americas and $4 million in Europe), which are fully compensated by Ardagh under the indemnity agreement in place.

Americas

Revenue increased by $77 million, or 16%, to $555 million in the three months ended September 30, 2021, compared with $478 million in the three months ended September 30, 2020. The increase in revenue principally reflected the pass through of higher metal costs and favorable volume/mix effects.

Adjusted EBITDA increased by $22 million, or 28%, to $100 million in the three months ended September 30, 2021, compared with $78 million in the three months ended September 30, 2020. The increase was mainly driven by favorable volume/mix effects, which includes an impact of the Group's growth investment program.

Europe

Revenue increased by $62 million, or 15%, to $483 million in the three months ended September 30, 2021, compared with $421 million in the three months ended September 30, 2020. Excluding favorable foreign currency translation effects of $14 million, revenue increased by $48 million, mainly due to favorable volume/mix effects and the pass through of higher metal costs.

Adjusted EBITDA increased by $3 million, or 4%, to $76 million in the three months ended September 30, 2021, compared with $73 million in the three months ended September 30, 2020. Excluding favorable foreign currency translation effects of $2 million, Adjusted EBITDA increased by $1 million, principally reflecting favorable volume/mix effects, including a positive impact from the Group's growth investment program, partly offset by increased costs.

Earnings Webcast and Conference Call Details

Ardagh Metal Packaging S.A. (NYSE: AMBP) will hold its third quarter 2021 earnings webcast and conference call for investors at 9.00 a.m. EST (2.00 p.m. BST) on October 28, 2021. Please use the following webcast link to register for this call:

Webcast registration and access:

https://event.webcasts.com/starthere.jsp?ei=1502997&tp_key=acbc8f17b7

Conference call dial in:

United States: +1 323 794 2093International: +44 330 336 9105Participant pin code: 3746074

Slides

Supplemental slides to accompany this release are available at https://www.ardaghmetalpackaging.com/corporate/investors

About Ardagh Metal PackagingArdagh Metal Packaging (AMP) is a leading global supplier of infinitely recyclable, sustainable, metal beverage cans and ends to brand owners. A subsidiary of sustainable packaging business Ardagh Group, AMP is a leading industry player across Europe and the Americas with innovative production capabilities. AMP operates 23 production facilities in nine countries, employing close to 5,000 employees and had sales of approximately $3.5 billion in 2020.

Forward-Looking StatementsThis press release includes "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Non-GAAP Financial MeasuresThis press release may contain certain financial measures such as Adjusted EBITDA, Adjusted operating cash flow, Adjusted free cash flow, net debt and ratios relating thereto that are not calculated in accordance with IFRS or US GAAP. Non-GAAP financial measures may be considered in addition to GAAP financial information, but should not be used as substitutes for the corresponding GAAP measures. The non-GAAP financial measures used by AMP may differ from, and not be comparable to, similarly titled measures used by other companies.

Unaudited Consolidated Condensed Income Statement for the three months ended September 30, 2021 ^(1)



Three months ended September 30, 2021

Before Exceptional

exceptional itemsitems Total

$'m $'m $'m

Revenue 1,038 - 1,038

Cost of sales (869) (8) (877)

Gross profit 169 (8) 161

Sales, general and administration expenses(40) (230) (270)

Intangible amortization (37) - (37)

Operating profit/(loss) 92 (238) (146)

Net finance (expense)/income (27) 9 (18)

Profit/(loss) before tax 65 (229) (164)

Income tax (charge)/credit (16) 2 (14)

Profit/(loss) for the period 49 (227) (178)

Unaudited Consolidated Condensed Statement of Financial Position ^(1)



At September 30, 2021

$'m

Non-current assets

Intangible assets 1,711

Property, plant and equipment 1,620

Other non-current assets 111

3,442

Current assets

Inventories 366

Trade and other receivables 624

Cash and cash equivalents 496

Other current assets including contract assets 283

1,769

TOTAL ASSETS 5,211



TOTAL EQUITY 271



Non-current liabilities

Borrowings including lease obligations 2,851

Other non-current liabilities* 781

3,632

Current liabilities

Borrowings including lease obligations 54

Payables and other current liabilities 1,254

1,308

TOTAL LIABILITIES 4,940

TOTAL EQUITY and LIABILITIES 5,211

* Other non-current liabilities include liabilities for earnout shares of $282million and warrants of $37 million.

Unaudited Consolidated Condensed Statement of Cash Flows ^(1)



Three months ended September 30, 2021

$'m

Cash flows from operating activities

Cash from operations ^(3) 138

Interest received 7

Income tax paid (7)

Cash flows from operating activities 138



Cash flows used in investing activities

Capital expenditure (139)

Cash flows used in investing activities (139)



Cash flows from financing activities

Changes in borrowings 7

Repayment of related party borrowings to Ardagh (996)

Proceeds from share issuance, net of costs 934

Lease payments (12)

Other financing cash flows (8)

Net cash outflow from financing activities (75)



Net decrease in cash and cash equivalents (76)



Cash and cash equivalents at beginning of period 587

Foreign exchange loss on cash and cash equivalents(15)

Cash and cash equivalents at end of period 496

Financial assets and liabilities



At September 30, 2021, the Group's net debt and available liquidity was as follows:



Drawn amountAvailable liquidity

$'m $'m

Senior Secured and Senior Notes 2,750 -

Global Asset Based Loan Facility - 325

Lease obligations 185 -

Other borrowings/credit lines 11 -

Total borrowings / undrawn facilities 2,946 325

Deferred debt issue costs (41) -

Net borrowings / undrawn facilities 2,905 325

Cash and cash equivalents (496) 496

Net debt / available liquidity 2,409 821



At September 30, 2021

$'m

Net Debt 2,409

LTM Adjusted EBITDA 637

Net debt to LTM Adjusted EBITDA ^(4) 3.8x

Reconciliation of loss for the period to Adjusted profit



Three months ended September 30,

2021

$'m

Loss for the period (178)

Exceptional items, net of tax 227

Intangible amortization, net of tax29

Adjusted profit for the period 78



Weighted average common shares 562.8



Loss per share (0.32)



Adjusted earnings per share 0.14

Reconciliation of loss for the period to Adjusted EBITDA ^(5), Adjusted operating cash flow and Adjusted free cash flow



Three months ended September 30,

2021

$'m

Loss for the period (178)

Income tax charge 14

Net finance expense 18

Depreciation and amortization 84

Exceptional operating items 238

Adjusted EBITDA 176

Movement in working capital (23)

Capital expenditure (139)

Lease payments (12)

Adjusted operating cash flow 2

Interest received 7

Income tax paid (7)

Adjusted free cash flow 2

____________________

Related Footnotes

(1) For information related to and including the period prior to April 1, 2021,please refer to the unaudited combined interim financial statements prepared ona carve-out basis from the consolidated financial statements of Ardagh GroupS.A., as included in the unaudited consolidated interim financial statements ofthe Group for the three and nine months ended September 30, 2021, which areavailable at https://www.ardaghmetalpackaging.com/corporate/investors

(2) For a reconciliation to the most comparable GAAP measures, see Page 7.

(3) Cash from operations is derived from the aggregate of Adjusted EBITDA aspresented on Page 7, working capital outflows of $23 million and otherexceptional cash outflows of $15 million.

(4) Net debt is comprised of net borrowings, net of cash and cash equivalentsand restricted cash held in escrow. Net borrowings comprises non-current andcurrent borrowings including lease obligations. LTM Adjusted EBITDA atSeptember 30, 2021 is derived from Adjusted EBITDA as presented on Page 2 forthe nine months ended September 30, 2021 and 2020, respectively, and AdjustedEBITDA as presented in the audited combined financial statements of the AMPBusiness for the year ended December 31, 2020, as included on pages F-2 to F-60of Amendment No. 3 of the Company's Registration Statement on Form F-4(333-254005) filed with the Securities and Exchange Commission (the "SEC") onJune 22, 2021 (the "Form F-4").

(5) AMP does not present a reconciliation to the most comparable GAAP measurefor Adjusted EBITDA for the three and nine months ended September 30, 2020 andthe nine months ended September 30, 2021, because such information washistorically reported to provide information about reportable segments of theArdagh Group S.A. and its subsidiaries. See the unaudited consolidated interimfinancial statements of the Group for the three and nine months ended September30, 2021 referred to in Note (1).

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SOURCE Ardagh Metal Packaging S.A.