Ardagh Metal Packaging S.A. - Second Quarter 2021 Results

LUXEMBOURG, July 29, 2021 /PRNewswire/ -- On April 1, 2021, the transfer of Ardagh Group S.A.'s ("Ardagh") metal beverage packaging business to Ardagh Metal Packaging S.A. ("AMP") was completed resulting in AMP becoming an unrestricted subsidiary of Ardagh. AMP today announced results for the quarter ended June 30, 2021, as derived from the group consolidation of Ardagh.

• Revenue growth of 14% at constant exchange rates to $991 million, with Americas increasing by 21% and Europe by 7%.
• Adjusted EBITDA growth for the quarter of 18% to $173 million at constant currency, with Americas increasing by 27% and Europe by 10%. LTM Adjusted EBITDA to June 30, 2021 increased to $613 million, from $545 million at December 31, 2020.
• Global beverage can shipment growth of 3% in the quarter, after a cyber security impact of 4%, and measured against a strong comparable. Year to date beverage can shipment growth of 5%.
• Specialty can growth of 16%, with double-digit gains in all regions. Specialty cans represented 46% of total shipments during the quarter, reflecting the Group's continued investment program.
• Demand remains strong across all segments and output is fully sold in all regions, supported by our customers' and end consumers' desire for sustainable packaging solutions.
• Growth investment projects to address capacity constraints are progressing well in each of our markets, with two new high-speed specialty lines ramping up in Olive Branch (MS), and large projects under way in Winston-Salem (NC) and Huron (OH). Multiple growth projects underway and fully on track in Europe and Brazil.
• New $300 million ABL facility to be executed imminently, augmenting cash on hand of $0.6 billion at June 30, 2021.
• Important social sustainability initiative launched with Project Lead the Way, promoting STEM education in all schools in the communities in which we operate across North America.
• In February 2021, AMP entered into a definitive agreement for a business combination with Gores Holdings V, Inc. (NASDAQ: GRSV, GRSVU and GRSVW). Stockholders to vote on proposed business combination on August 3, 2021. If approved, shares of AMP will begin trading on the New York Stock Exchange ("NYSE") under the ticker "AMBP" on August 5, 2021.
• Full year 2021 Adjusted EBITDA guidance will be at least in line with the previously guided $654 million. Third quarter Adjusted EBITDA guidance of approximately $170 million (Q3 2020: $151 million).

Financial Performance Review

Bridge of 2020 to 2021 Revenue and Adjusted EBITDA

Review of the three months ended June 30, 2021

Group

Revenue in the three months ended June 30, 2021 increased by $161 million, or 19%, to $991 million, compared with $830 million in the three months ended June 30, 2020. The increase in revenue is primarily driven by favorable volume/mix effects, which includes an impact of the Group's business growth investment program, the pass through to customers of higher metal costs and favorable foreign currency translation effects of $39 million.

Adjusted EBITDA in the three months ended June 30, 2021 increased by $34 million, or 24%, to $173 million, compared with $139 million in the three months ended June 30, 2020. The increase was primarily driven by favorable volume/mix effects, which includes an impact of the Group's business growth investment program and favorable foreign currency translation effects of $7 million. Included within Adjusted EBITDA in the three months ended June 30, 2021 are losses relating to the cyber security incident of $15 million ($11 million in Europe and $4 million in Americas), which are fully compensated by Ardagh under the indemnity agreement in place. This cyber security incident is further detailed below.

Europe

Revenue increased by $69 million, or 17%, to $464 million in the three months ended June 30, 2021, compared with $395 million in the three months ended June 30, 2020. Excluding favorable foreign currency translation effects of $39 million, revenue increased by $30 million, mainly due to the pass through of higher metal costs.

Adjusted EBITDA increased by $15 million, or 21%, to $85 million in the three months ended June 30, 2021, compared with $70 million in the three months ended June 30, 2020. Excluding favorable foreign currency translation effects of $7 million, Adjusted EBITDA increased by $8 million reflecting higher selling prices, including to recover increased input costs and a positive impact from the Group's business growth investment program.

Americas

Revenue increased by $92 million, or 21%, to $527 million in the three months ended June 30, 2021, compared with $435 million in the three months ended June 30, 2020. The increase in revenue principally reflected favorable volume/mix effects and the pass through of higher metal costs.

Adjusted EBITDA increased by $19 million, or 27%, to $88 million in the three months ended June 30, 2021, compared with $69 million in the three months ended June 30, 2020. The increase was mainly driven by favorable volume/mix effects, which includes an impact of the Group's business growth investment program.

Cyber incident

On May 17, 2021, the Group announced that it had experienced a cyber security incident, the response to which included pro–actively shutting down certain IT systems and applications used by the business. Key systems have now been brought back online securely, in a phased manner and in line with our plan. Production at all of our manufacturing facilities continued to operate throughout this period, though we experienced some shipping delays as a result of this incident, principally in Europe. While investigation of the incident is ongoing, we have already taken various steps, including engaging leading industry specialists to conduct a forensic investigation of our systems and introducing additional protection tools across our network to further enhance the security of our IT systems. We believe that our existing information technology control environment is appropriately robust and consistent with industry standards. In addition to addressing any findings from these investigations and assessments, we are reviewing our information technology roadmap and accelerating planned IT investments to further improve the effectiveness of our information security. We do not believe that our business growth investment program has been impacted by this incident. We maintain appropriate insurance in respect of a wide range of risks, including in respect of IT incidents. In addition, AMP entered into a letter agreement with Ardagh dated May 21, 2021, under which Ardagh agreed to indemnify AMP and its subsidiaries for certain losses arising from this incident.

Earnings Webcast and Conference Call Details

Ardagh Metal Packaging S.A. (NYSE: AMBP) will hold its second quarter 2021 earnings webcast and conference call for investors at 9.00 a.m. EST (2.00 p.m. BST) on August 3, 2021. Please use the following webcast link to register for this call:

Webcast registration and access:

https://event.webcasts.com/starthere.jsp?ei=1480554&tp_key=cca6fa6e83

Conference call dial in:

United States: +1 323 794 2095
International: +44 330 336 9104
Participant pin code: 182599

Slides

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

About Ardagh Metal Packaging
Ardagh 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 Statements
This 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 Measures 
This press release may contain certain financial measures such as Adjusted EBITDA, working capital, Adjusted operating 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.

SOURCE Ardagh Metal Packaging S.A.