Ardagh Metal Packaging S.A. has announced results for the second quarter ended June 30, 2024. Oliver Graham, CEO of Ardagh Metal Packaging (AMP), explained that: “our strong earnings performance, reflected in EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) growth achieved a second consecutive outperformance against our quarterly guidance.”
Global beverage can shipments grew 3% in the quarter, driven by strong 5% growth in Europe, with 1% growth in the Americas.
North America grew 3%, compared to a strong prior year, supported by contracted volumes.
Volumes in Brazil were impacted by temporary customer mix effects during the off-season, while the industrial backdrop continues to strengthen.
Adjusted EBITDA of $178 million for the quarter exceeded expectations and represented an 18% increase compared to the prior-year quarter.
In the Americas, Adjusted EBITDA for the quarter increased 14% to $99 million, driven by favorable volume/mix and lower operating costs.
In Europe, Adjusted EBITDA for the quarter increased 23% to $79 million, primarily due to favorable volume/mix and stronger input cost recovery, partially offset by higher operating costs.
Total liquidity improved to $405 million at June 30, 2024, exceeding expectations.
Growth capital spending will be reduced to approximately $100 million in 2024, in line with previous guidance, with an additional reduction anticipated by 2025″ said Graham.
“Volume growth, strong input cost recovery and reduced plant operating costs drove sequential improvement in Adjusted EBITDA growth. Solid performance in Europe underpinned our outperformance in the quarter and continued growth in the region gives us confidence to improve our guidance range for Adjusted EBITDA growth in 2024.”
Modest deleveraging is expected in 2024, compared to the position at the end of 2023, through growth in Adjusted EBITDA and lease principal payments, with a more significant reduction thereafter.
Adjusted free cash flow for the full year 2024 is anticipated to be approximately in line with previous expectations.
Announced a new $300 million secured funding commitment from Apollo directly to AMP, which will further strengthen liquidity in the second half of the year and complement expected seasonal cash flows.
The financing is expected to be net leverage neutral.
A quarterly ordinary dividend of 10 cents is announced.
No change in capital allocation priorities.
The outlook for 2024 has improved: shipment growth is approaching the mid-single-digit range and Adjusted EBITDA for the full year 2024 is in the range of $640-660 million (versus the previous range of $630-660 million).
Third quarter Adjusted EBITDA is expected to be in the range of $185 million (Q3 2023: $171 million reported and at constant exchange rates).
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