Ardagh Metal Packaging S.A. (NYSE:AMBP) Q3 2023 Results Conference Call October 26, 2023 9:00 AM ET

Company Participants

Stephen Lyons - Investor Relations

Oliver Graham - Chief Executive Officer

David Bourne - Chief Financial Officer

Conference Call Participants

Mike Roxland - Truist Securities

Anthony Pettinari - Citi

Arun Viswanathan - RBC Capital Markets

Operator

Good day, and welcome to the Ardagh Metal Packaging Third Quarter 2023 Investor Call. Today’s conference is being recorded. At this time, I’d like to hand the call over to Mr. Stephen Lyons, Investor Relations. Please go ahead.

Stephen Lyons

Thank you, operator, and welcome, everybody. Thank you for joining today for Ardagh Metal Packaging's Third Quarter 2023 Earnings Call, which follows the earlier publication of AMP's earnings release for the third quarter. We have also added an earnings presentation on to our investor website for your reference.

I'm joined today by Oliver Graham, AMP's Chief Executive Officer; and David Bourne, AMP's Chief Financial Officer.

Before moving to your questions, we will first provide some introductory remarks around AMP's performance and outlook. AMP's earnings release and related materials for the third quarter can be found on AMP's website at www.ardaghmetalpackaging.com.

Remarks today will include certain forward-looking statements and include use of non-IFRS financial measures. Actual results could vary materially from such statements. Please review the details of AMP's forward-looking statements disclaimer and reconciliation of non-IFRS financial measures to IFRS financial measures in AMP's earnings release.

I will now turn the call over to Oliver Graham.

Oliver Graham

Thank you, Stephen. We delivered a robust performance in the quarter to achieve our guidance despite weaker-than-expected demand conditions in Europe. Americas performance was slightly ahead of our expectations, with North America benefiting from strong shipment growth, while Brazil was broadly in line. The deterioration in European demand during the quarter negatively impacted performance against our expectations, which we anticipate will persist into Q4.

Our operating cash flow generation has significantly improved versus the prior year that underpins our conviction in a strong full year liquidity outturn. We now anticipate that full year adjusted free cash flow post our growth CapEx, which is near its completion, will be approximately $100 million, which is double our prior expectation.

Adjusted EBITDA for the company increased by 22% versus the prior year quarter. This reflected the contribution from increased shipments and a stronger recovery of input costs in Europe, predominantly due to the pass-through of energy costs. The prior year quarter also experienced a significant impact relating to metal valuation timing mismatches, which through our hedging actions and reduced inventory positions, we have substantially derisked.