Please stand by. We're about to begin. Welcome to the Ardagh Metal Packaging S.A. Q1 2022 update call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Oliver Graham, Chief Executive Officer of Ardagh Metal Packaging. Please go ahead, sir. Thanks, Jess. Welcome, everybody, and thank you for joining today for Ardagh Metal Packaging's Q1 2022 earnings call, which follows the earlier publication of AMP's earnings release for the Q1. I'm joined today by David Bourne, AMP's Chief Financial Officer, and by Stephen Lyons, AMP's Investor Relations Officer. Before moving to your questions, I will first provide some introductory remarks around the impact from the current war in Ukraine, AMP's performance, and outlook. Remarks today will include certain forward-looking statements. These reflect circumstances at the time they are made, and the company expressly disclaims any obligation to update or revise any forward-looking statements. Actual results or outcomes may differ materially from those that may be expressed or implied due to a wide range of factors, including those set forth in AMP's SEC filings and news releases. AMP's earnings release and related materials for the Q1 can be found on AMP's website at ardaghmetalpackaging.com. Information regarding the use of non-GAAP financial measures may also be found in the notes section of the release, which also includes a reconciliation to the most comparable GAAP measures of adjusted EBITDA, adjusted operating cash flow, and adjusted free cash flow. Details of AMP's statutory forward-looking statements disclaimer can be found in AMP's SEC filings. Before I turn to the trading performance in the Q1 and the outlook, let me first make a few comments on the Ukraine-Russia conflict. When we presented our quarter four results on the February 24, we could not have envisaged the consequences of Russia's invasion of Ukraine that same day. Like so many people globally, we are horrified at the events currently taking place in Ukraine and hope that this conflict is brought to a halt as soon as is possible. AMP does not have any employees or operations in the region, and any past sales would have been at de minimis levels. We have not experienced any disruption to either our customer sales or to our suppliers arising from the conflict. We source no aluminum can sheet from the region, nor had any agreement to source any future supply to underpin our growth ambition. The conflict has exacerbated what was already a challenging backdrop in terms of inflationary pressures and supply chain bottlenecks. Our multi-year contracts contain pass-through mechanisms that share inflationary cost pressures across the supply chain. However, specifically in Europe, such is the magnitude of the short term exceptional spike in our energy and related input costs that we are taking corrective action to recover these costs. Turning our attention to AMP's Q1 results. For the Q1 of 2022, we delivered a good result in line with our guidance, despite the challenging backdrop of unprecedented inflationary and supply chain pressures. AMP recorded revenue of $1.137 billion, which represented growth of 25% on a constant currency basis, predominantly reflecting the pass-through of increased input costs. Adjusted EBITDA of $145 million was both 1% higher than the prior year on a constant currency basis and against our guidance. This reflected a positive volume and product mix contribution, which was offset by inflationary cost pressures. Total beverage can shipments in the quarter were 1% higher than the prior year, which reflected a strong prior year comparable when shipments rose by 8%. Growth was driven by our new investments in North America as European volumes are largely capacity constrained ahead of the ramp up of new capacity from the current quarter. Customer demand remains strong across North America and Europe, and supply conditions remain tight, as evidenced by continued imports into the North American market. Specialty cans represented 48% of global shipments in the quarter, up from 44% in the prior year quarter, and we remain on track to increase this share to over 50% of the mix this year. Our specialty mix was higher still at 62% in the Q1, inclusive of 50 cl cans in Europe. Looking at AMP's results by segment and at constant exchange rates. Revenue in the Americas increased by 27% to $638 million, mainly due to the pass-through of higher input costs. Shipments were 2% higher in the Q1 of 2021, with growth in North America partly offset by further softness in Brazil for part of the quarter. In North America, shipments grew by 3% for the quarter. Demand remains strong across a broad mix of categories to which AMP has exposure, with particular strength in energy and fitness drinks, ready-to-drink cocktails, and CSD. The beverage can market remains capacity constrained, illustrated by continuous imports into North America so far this year, despite recent capacity additions. In Brazil, Q1 shipments declined by 4%, but outperformed the market, which fell by over 20%. Shipments in the quarter were impacted by pressures on consumer spending and restrictions on social gatherings. We have recently seen some signs of recovery with improved sales in March that have continued into the current quarter. Q1 adjusted EBITDA in the Americas increased by 9% to $89 million. Growth reflected higher volumes in North America, strong recovery from input cost inflation, and strong cost management. Looking forward, we expect a significant acceleration in shipment growth in the Americas, led by North America, as customer contracted new capacity additions come online and support strong broad-based category growth. We expect a gradual recovery in Brazil and weighted towards the second half of the year. AMP remains highly confident on the medium-term prospects for the Brazilian market. In Europe, Q1 revenue increased by 23% at constant currency to $499 million, compared with the same period in 2021. Shipments for the quarter were unchanged on the prior year, ahead of an anticipated ramp-up in activity from the Q2 arising from new growth investments. As previously disclosed, we experienced a delay to our planned ramp-up of new U.K. capacity, which is now operational, but we also experienced a fire in one of our German plants. Without these two events, our shipments would have been 3% higher. There has been some short-term impact to the off-trade market in parts of Europe from the reopening of the on-trade as social restrictions ease, most notably with alcoholic beverages in the U.K., but our shipment activity in the quarter largely reflected our own inventory and capacity constraints after a strong Q4. Q1 adjusted EBITDA in Europe fell by 9% on a constant currency basis to $56 million as performance was impacted by exceptional input cost inflation. This was in line with our expectations. Looking to the remainder of 2022, full year shipments are expected to grow strongly, benefiting from the addition of new capacity in Germany and the U.K. during the current quarter. Europe remains a capacity constrained market and dialogue with our broad mix of customers continues to confirm a positive demand outlook for the medium term. Turning now to AMP's growth initiatives. Significant progress was made on the business growth investment program during the Q1 of 2022, with a total investment of $110 million, underpinning the anticipated pickup in shipments. Our project teams continue to effectively manage global logistics pressures and minimize potential delays and disruptions to bring new capacity online in support of our customers' growth ambitions. To recap on some of the larger growth investment projects, all of which are backed by multi-year customer agreements. In North America, the first of our two high-speed lines in Winston-Salem, North Carolina, started production during the Q1. The second line is now also in production. In Huron, Ohio, the first of the new can lines will commence production shortly to be followed by a second line around mid-year, with further capacity to be added later in the year. As outlined with our Q4 results commentary, our new multi-line plant in Arizona will add an additional initial 3.5 billion of capacity to support customers' growth. Construction will begin later this year, with production commencing in the first half of 2024. In Europe, new capacity in the U.K. has started production this quarter, as well as in Germany, as part of an expansion project that will also see further capacity addition in the first half of 2023, while our new facility in Northern Ireland is progressing through planning. In Brazil, we continue to make progress towards the addition of new capacity at our Alagoinhas plant towards the end of the current year. We are also progressing our greenfield facility in Minas Gerais. Investment of approximately $1 billion on business growth investments is planned during 2022, all of which are expected to generate significant earnings and free cash flow accretion. We remain confident in the long-term secular growth drivers supporting the beverage can that we've previously outlined. We also see no deterioration in end consumer demand in the current environment, reflecting the defensive nature of our products. The global can sheet market is in tight supply, but we are fully contracted to support our multi-year capacity growth and our supply is predominantly sourced locally. Therefore, notwithstanding near-term inflationary pressures, we remain on track to deliver on our plan to more than double adjusted EBITDA from 2020 to 2024, supported by our growth investments. Now focusing on progress towards our sustainability goals in the quarter. We continue to advance our ambitious sustainability agenda. As part of our social pillar, in March, we celebrated International Women's Day as an annual reminder of the efforts we need to make together as a society in working towards equality by celebrating women's achievements and accomplishments. Coinciding with Earth Day, we announced plans to install on-site solar generation at our site in the Netherlands. This follows similar initiatives already in place in our plant in Austria. These installations are part of our overall goal to move towards 100% of electricity from clean and renewable sources by 2030, as well as contributing significantly to our overall CO2 reduction. We continue to progress a number of renewable on-site and off-site PPA opportunities in Europe and North America towards our 2030 target. The war in Ukraine further underpins the importance of limiting our use of fossil fuels, and in Europe, renewable sources now represent close to half of our electricity needs. In the quarter, we also received a supplier engagement rating of A from CDP, which positions us in the leadership band. Our leadership position on supplier engagement also complements our leadership positions that we occupy for both climate change and water management. We will shortly publish the allocation and impact report as committed to in the Green Bond Framework for the proceeds that were raised last year, recognizing our focus on energy efficient state-of-the-art new investment projects. As well as our focus on maximizing the product proportion of high recycled content in our products. We continue in parallel to develop our STEM education program in the U.S. and elsewhere. Our U.S. program is now operational in some 320 public schools in the communities where we operate. Moving now to our financial position and our capital allocation framework. As well as delivering adjusted EBITDA of $145 million in the Q1 that was in line with our guidance, AMP maintained a strong liquidity position in what is seasonally a quarter of working capital investment. This also follows positive working capital movements in the Q4 that were ahead of expectation. Adjusted EBITDA minus maintenance capital expenditure was $125 million, or 86% of adjusted EBITDA, which illustrates the strong underlying cash generation looking through the seasonality of working capital movements. Total liquidity at the quarter end was $450 million, of which $225 million was in cash and the balance by way of our undrawn ABL facility. Net leverage ended the quarter below 4.2x LTM adjusted EBITDA. As we set out in February, we intend to return $400 million to shareholders in 2022, or $0.66 per share. Today, we have declared a Q1 dividend of $0.10 per share, and we expect to follow this with further dividends of $0.10 per share in respect of each of quarter 2 and quarter 3, with the balance being paid before year-end. We intend to proceed with the planned issuance of $600 million of non-convertible preference shares and envisage net leverage at the end of 2022 being well below the forward-looking adjusted EBITDA leverage guidance of 3.75x-4x which we outlined in February. Before moving to take your questions, I'd like to recap on AMP's performance and key messages. Today, AMP reported Q1 EBITDA that was in line with our guidance. Progress on our growth investments in the quarter positions us for a meaningful step-up in shipments activity across the remaining quarters in 2022. The medium-term demand outlook across each of our markets remains strong and underpins our earning and cash flow accretive customer-backed growth investments. Our plan to more than double adjusted EBITDA from 2020 to 2024 remains on track. Full year 2022 adjusted EBITDA is projected to be of the order of $750 million using Q1 average FX rates, compared with our previous guide of $775 million, which was on a comparable basis. This reduction reflects unprecedented inflationary pressures, particularly in Europe, arising from the impact of the war in Ukraine, for which we are taking corrective action. Our guidance for global shipment growth in 2022 of between a mid- to high-teens% remains unchanged. In terms of guidance for the Q2, adjusted EBITDA is anticipated to be in the order of $180 million versus the prior year of $168 million on a constant currency basis. Having made these opening remarks, we will now proceed to take any questions that you may have. Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, it is star one to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal. Our first question comes from George Staphos with Bank of America. Your line is open. Please go ahead. Hey, thanks very much. Hi, everybody. Good morning. Oli, thanks for the details on the presentation. I just wanted to hit on the EBITDA guidance for the year just to be clear. Even though the wording has changed, the basis in terms of how you're guiding hasn't changed. All you're basically saying on a constant currency basis is that you don't wanna be in the currency forecasting business, nor do we. Based on what you're seeing right now in terms of currencies, you're guiding to, you know, on the order of $750 million. Would that be fair? That's the same base that you're projecting last quarter when it was $775. Hi, George. I think that's exactly right. I think we've taken the average Q1 rates given the volatility of FX. There is a small risk if you took today's spot of the order of five-10, but I think the EUR 7.50 seemed like a fair way to present it relative to the EUR 7.75, and given, you know, that was using the average Q1 rates. Okay. The actions that you're taking to offset the inflation that you've been seeing, can you talk a bit about what that means in more detail and when you actually expect that to materialize? Is it something that shows up later this year? Or is it something that, you know, given the markets, the lags, and so on, that it would be more of a 2023 benefit that you'd be receiving? And relatedly, can you talk to the degree to which you are unhedged on energy prices in Europe? Sure, yeah. Maybe in reverse order. We entered the year, as we said at the Q4, was about 75%-80% hedged. With some open position, we hedge, you know. You know, we get a lot of external such advice on this, so we hedge on a rolling basis and, you know, we were doing that. We still have some open. I mean, I think we're not gonna give running commentary on the exact percentage, but we are hedging that forward as we go. The corrective actions, you know, that is a dialogue with our customers, you know, as we said in the remarks. It's such a large spike in energy costs, and it's driven by such a completely unforeseen set of events, that we felt it was appropriate to address that as a pass-through with customers at the current time. I think then to the other piece, that's weighted more to the second half of this year rather than to 2023. Okay. Then lastly, I'll turn over. You know, you talked about continued optimism in the growth in beverage cans, and the market being sold out. On the other hand, you know, if I wanna pick at some things, your growth in Europe ex the disruptions was 3%. In North America, it was 3%. Three years ago, we would've been thrilled with that kind of volume growth. Now, based on or in comparison to, you know, recent quarters, that's somewhat lower. You know, why do you feel comfortable on the growth outlook? What is your long-term growth outlook, for the market? Are there any weak spots developing that you would have us consider, or you feel the same pretty much across your end markets and for the market as a whole? Thank you. I'll turn over. Yeah, no, sure. I mean, let's go region by region through that one. I think, you know, Europe, we see Europe as a mid-single-digit market medium term. We've had a lot of inbound inquiries for additional projects, you know, during the quarter. There was, as I mentioned in the remarks, a little bit of weakness in beer in Q1. I mentioned the U.K. We'd always, I think, signaled that there was some COVID support in the U.K. There was a very rapid opening up in the U.K., which meant our customers had to pivot into kegs very quickly. We see that as a bit of a one-off correction. We also think there's a bit of pressure on export beer out of Europe because of the high costs of ocean and international trades at the moment. We see those as, you know, to be honest, one-off and specific events and remain very confident about the prospects for the European market. I think we also have been clear. You know, we didn't add any capacity to Europe last year. It's only in the beginning of this year that we started to get additional capacity coming online, and that was delayed by the COVID effects on the U.K. and by some equipment- Right. Issues. You know, we grew very strongly in Q4. That left us very tight on inventory. With the other capacity hit, we really didn't have anything more to give. I think that's why we're perfectly confident around Europe. North America, you know, again, we talked about it because the Q4 is quite deep into the quarter. You know, we are still working through the seltzer inventory overhang. I think as the quarter progressed, we really saw, you know, some players in particular coming back strong in our numbers. We feel good about that. We feel good about the ready-to-drink cocktail space that's linked to that, and we know that retail in North America have planned a big summer around ready-to-drink. The other categories in North America look healthy too. Energy in particular, you know, the waters. We're seeing now innovation coming on the still water side in particular. North America looks good. Brazil, you know, we just see this long-term 281 way. We see the GDP growth driving beer consumption. We had some good recovery in March and April. I think our customers are very confident for the October to February period there, when you think there's a World Cup, a summer, a much more, hopefully, significant carnival period. I think we think Brazil will revert to the sorts of growth path that we've seen before and anticipated in the process last year, so north of 5%. North America, just on the market, I think we see, you know, 3%-5% very realistic. I think, yeah, overall there's a number of specific factors, but we remain very confident in the medium-term outlook. Okay, thanks, Ollie. I'll turn over. I'll be back. Thank you. Good. We'll go next to Mark Wilde with Bank of Montreal. Your line is open. Please go ahead. Thanks. Good morning, Oliver. Hi there. I wonder, can you just help us over in Europe with how much of a net drag you expect this year from unrecovered energy costs, energy and other costs? Yeah. I mean, that's essentially the $25 million in the guidance. You know, it's basically the EUR 7.75-EUR 7.50 is entirely European, either direct or indirect energy inflation. Okay. Along the same line, can you just talk about any impact from higher converting margins on aluminum can sheet, whether that creates any headwind because maybe, you know, you're indexed to ingot price and as the converting spread would widen, you wouldn't be able to recover all of that? Or is that not an issue? No, I think it's the LME and premium are largely hedged out or passed through. You see some impact in our working capital line from increased LME and premium costs. There's a drag cash-wise, but not EBITDA-wise. The ingot to sheet conversion is a more specific you know supply-demand question. Though, I think the reason you're hearing about it in particular at the moment is because of ocean freight, very high ocean freight costs. For imports into the regions, those costs have risen very significantly and are forecast to stay at elevated levels into 2023. That is something I think will you know all can makers are looking at and we're looking at in terms of our 2023 recovery. Okay. All right, last one for me. Any color you can provide us around Brazil because your 4% drop versus that 26% for the industry is really quite striking. Yeah. It's all about customer mix. You know, we actually were on the wrong end of that in the Q4s. You know, because we had a slight customer mix where our customer base performed slightly less well in the market, and now we're the other side of that, which is, you know, our customer mix is performing slightly better than the market. That's what's driving that. Okay, very good. I'll turn it over. Thank you. Our next question comes from Kyle White with Deutsche Bank. Your line is open. Please go ahead. Hey, good morning. Thanks for taking the question. In Europe, just curious how much contract renewals you have lined up at the end of this year to drive some of the cost recovery you talked about and some of the contractual changes that you have discussed. No, I mean, we're very strongly contracted actually. But I think, you know, we're still confident we have the opportunities to address the current inflation environment with our customers. You know, we see that we do need to do that. I think it is a new environment with this level of volatility, but we see that we can address that going into 2023. Got it. I'm curious what's been some of the reception you've heard from shareholders on the preferred now that, you know, it's been roughly a quarter since you announced it? When should we expect the issuance of preferred to occur? Yeah, I can't really add anything to the remarks on the timing, but I think we've had a range of feedback from, you know, across the piece. You know, I can't add much more to the remarks on that. If I could follow up then. Is it still the plan to have a pretty, you know, increasing dividend year over year? Yeah. I think that given our growth plan and the very high cash generative nature of the business, I think we see it as appropriate to have a progressive dividend policy. Got it. I'll turn it over. Thanks, Kyle. We'll go next to Arun Viswanathan at RBC Capital Markets. Your line is open. Please go ahead. Great. Thanks for taking my questions. And congrats on the quarter. Yeah, I guess similarly to some other questions, you know, you're still sounding very positive on your longer term outlook. I guess when you think about the visibility, would you say that you still have visibility out to 2025, or has that kind of shortened? And then maybe if you could provide a little commentary on the Brazilian market. I know that there's been, you know, a little bit of a pullback there, maybe GDP related and other factors like the World Cup. When do you see that kind of normalizing and what's kind of the trajectory we should expect over the next couple quarters for Brazil? Thanks. Sure. I don't think the visibility's changed. I mean, as we laid out in our SEC and SPAC process last year, we're very highly contracted with strong contract structures through 2024. Obviously, as we've added slightly to the capacity build through 2025, we've also required that to be contracted with visibility around volumes. I don't think that visibility's changed relative to where we were before. Obviously we are in a highly volatile environment, particularly in Europe, but you know, we hope that's not a long-term situation so much as a short-term situation. Then on the Brazilian market, I think, yeah, as you say, I think there's been some consumer spending pressure. There was very poor weather at the beginning of the summer, and then this shutdown of the carnival was very significant relative to normal summer seasons. We see some recovery at the moment, but we're going into the low season, so that's off a, you know, lower base. The main recovery we think will come in Q3 and Q4. I think the October to February period is where we see the big recovery, where we have the World Cup for the first time ever in Brazil, in a Brazilian summer, and the World Cup's always good in Brazil anyway. We have, you know, hopefully, assuming no further COVID setbacks, you know, a very significant carnival season. We're, and our customers are very hopeful for the growth in that period. Okay, thanks. As a follow-up, maybe I could ask about some of the different categories. Ardagh has a little bit more exposure to the seltzer market than some of your peers. Could you just comment on what you're seeing there? You know, maybe if you could comment also on if there's any differences between regions. Are you seeing any improvement in you know, some of those other newer categories in Europe? Thank you. Sure. I think the seltzer market is sort of broadly where the big players are projecting it. I think Boston Beer came out the other day with a sort of zero-10, with them at four-10. You know, that we see it in that range, sort of mid-high single digits for the year. What we're seeing then on our numbers is a very significant recovery because the inventory is being worked through increasingly, some players faster than others, but that is happening. We're also seeing the replacement of imported cans in the mix of those customers. Yeah, we're seeing a very significant recovery in our sales there and, you know, absolutely in line with our forecasts. We expect, you know, a decent level of growth for the years ahead. I think that there needed to be a shakeout, and now the main players in the category can start to manage the category properly in terms of promotion and innovation and pricing and shelf management. We see that's what will happen over the next few years. Plus, I think we see the category as being the seltzer and the ready-to-drink space. Obviously, as I said before, the ready-to-drink cocktail space is very hot. Lots of innovation and lots of retailer interest and space being dedicated to that. I think then on other categories, energy, as I said, very strong, and that's the broader energy space. I think sparkling water continues to do very well. And now what we're seeing is this innovation into still water. We've got a couple of brands. We've mentioned Liquid Death on the call before, but people really pushing into that space in a significant way, obviously still from a small base, but looking good, and that's on both sides of the Atlantic. Coffee and wine continue to be areas going into cans. In general, I think innovation still strongly weighted towards cans in the beverage space. Just considering all of what you just mentioned, is there possibility that you'd be announcing, you know, more greenfield expansions? Or, how do you plan to meet all that demand? Obviously we did announce Arizona. I think some of the projects we've announced have got more space within them. We are also still discussing, you know, projects with customers. I think we'll take that as a, you know, over the course of this year, next year to see what more capacity we need in addition to the current plan. Thanks. Thank you. Our next question comes from Roger Spitz at Bank of America. Your line is open. Please go ahead. Thanks, very much. On the $600 million preferred shares, can you just remind us what the use of proceeds for that will be? David, do you wanna take that? Yeah. The intention of the use of proceeds, Roger, is it's a green preference share issue, and it will support some of our new investments. You know, and therefore kind of support the BGI that was over and above that that we initially set out during the transaction. Got it. Then, I don't think you said it or mentioned this. Can you update us on any other pieces of guidance after EBITDA? Like, I think last quarter, CapEx was $1.1, for instance. Cash taxes, working capital, inflow, outflow. Anything you can tell us there, please? Sure. I'll hand that to David. Yeah, sure. Our overall investment in BGI for the year will be of the order of $1 billion still. Very much close to what we said to you last time. Cash tax, $50 million, which is, I think, pretty much in line with last time. No change on maintenance CapEx. Working capital, there's probably a slight headwind of circa $50 million, which broadly arises from the grossing up of all working capital balances with input costs for LME and premium and that sort of thing, as Ollie referred to earlier. Otherwise we're pretty much level state with where we expected to be previously. Great. I don't know if you'd wanna let us know this, but what do you expect your 2022 volume growth will be when the dust settles? I think we said mid-teens in the remarks. Okay. Yeah. Got it. All right. Thank you very much. Thank you. We'll go next to Jay Meyers with Goldman Sachs. Your line is open. Please go ahead. Good morning. Thank you for taking the questions. My first one just relates to the full year EBITDA guidance against kind of where you're guiding for the first half. So I guess first of all, with regards to that $25 million kind of price cost headwinds you discussed earlier, is that primarily rolling through in 2Q? And then secondly, if I kind of back into second half implied EBITDA guidance, can you kinda walk us through what you're thinking about in terms of, you know, recovery on that price cost versus volume? The first part of your question, we do see the drag being heavily Q2 weighted because obviously there's some lag to the recovery. We were always H2-weighted in our plan this year because of the capacity ramp. We have capacity ramp going on, particularly in Q1 and Q2. We were always significantly H2-weighted. That side of the plan hasn't changed. The real thing going on is this, as you say, the price-cost squeeze that's occurring thanks to European energy, both direct and indirect energy costs. The majority of that impact is hitting in the Q2. Got it. Just to clarify, that $25 million, that is all kind of energy and other cost inflation. That's not related to the FX that you discussed, right? Correct. Yeah, the FX is a slight addition to that if you took today's spot rates. Again, the volatility is so high, we took an average Q1 for that. Understood. Okay. Thank you. my final one, just on the balance sheet. You know, I noticed you had a $100 million revolver draw. Can you kind of walk us through kind of, A, is that mostly just kind of timing given, you know, what happened with the markets and your kind of plans around the preference shares? B, going forward, as we kind of think about seasonality and your working capital needs throughout the year, do you kind of anticipate the revolver being, you know, a source of cash in the first half of the year as you fund working capital? Or is it mostly kind of related to what we're seeing on input cost inflation and again, the timing of the preference shares? I'll pick up on that, Ollie. Yeah, no, look, the ABL facility is always designed as a kind of working capital facility. We do have some natural seasonality to our business, and our working capital peak is usually in Q1. It's a natural point in our cycle to use the ABL facility. Clearly, yeah, at the point where we have other income coming through, then we won't need to engage with that. But the normal working capital cycle would be a build in Q1 and then a steady release through the other three quarters of the year. That's all very helpful. Thank you for the time. Thanks. We'll take our next question from Paul Brennan with GoldenTree. Your line is open, sir. Please go ahead. Hi, good afternoon. My question is similar to the previous speaker, just about kind of step-up and expected performance in the second half of the year. Is it possible for you to kind of quantify the overall drag in, say, H1 from input costs, etc.? You know, you said there's an additional $25 million, but it would be helpful to understand kind of what the total figure is that's hurting the numbers in the first half and how that kind of progresses into the second half of the year. I mean, it is the addition of the guidance we gave you at the Q4s and this guidance. We had in the Q4s a step down of FX of around $20 million and another $15 million of input cost timing drag. You'll remember we spoke about the fact that our inflation pass-through clause do sometimes lag. We had that $15 million, and then essentially we've added the $25 million to that. I think those two numbers are your number essentially for the overall input cost drag for 2022. Got it. It sounds like second half of the year you expect that to be pretty flat. Yeah. For the price increases you're pushing through to offset. Got it. Yes. Just one. Sorry. Go ahead, sorry. Just one other question from me. Just on the EBITDA guidance revision from $775 to $750. Sorry if you've mentioned this already, but is there any effects in that at all, or is the $25 all operational? The 25 is all operational. That was the piece we mentioned at the top because we saw there was some confusion around that. That's all at the same, essentially the same FX rate. Well, if you took today's spot, there's another $5-$10 risk, but we took the Q1 average because of the volatility on the rates. Understood. Thank you. Pleasure. Our next question comes from Gay, excuse me, Gabe Hajde at Wells Fargo Securities. Your line is open. Please go ahead. Oliver, David, good morning. Hi, Gabe. Hajde. I was curious, can you talk to us a little bit about contract protections that you have? I think for a while we were hearing kind of take or pay type provisions. Can you talk about number one, I guess practically speaking, how that might play out in the event that, you know, volumes don't materialize the way you envision? Then second, I guess a very direct question, are any of your current capacity additions underpinned or dependent on Stillwater, or is that something that would be above and beyond and sort of, I guess, white space for you as it sits today? Yeah. The second one's easy and the answer is no, none of it's dependent on still water. I think when we were putting the investment program together, we saw that more middle of the decade in a way, the next wave of growth. Now, some of it is coming quicker than we thought, as I mentioned. We see, and we always expected this, that it would be the challenger brands that come into it because, you know, the existing brands have such significant invested asset base and also are not familiar with the can in the same way as, you know, a CSD player would be. That is what we're seeing. We're seeing challenger brands come into the space with new brands and new propositions, and I think that will be the catalyst for a more significant movement. No, our overall capacity plan is not really. I mean, I think we have really small numbers in nothing that would be significant to the capacity build. On your first question, I think, I mean, we always talked about, you know, we have a range of contractual protections around volumes, some take or pay, some min-max type arrangements. Obviously, I can't go into lots of detail on a big call, but I think that you know, we're comfortable with those protections and, you know, sometimes things go wrong, you know, they can either be implemented as they are, or they can be the basis for other commercial discussions. We're comfortable overall with the level of volume protection that we've got in these contracts. Okay. Thank you. Then I guess, as others are sort of probing around this call, you know, we've had an opportunity to digest quite a few earnings this week and from competing substrates. One of the things that's interesting to me, if I think about the Europe market specifically, you know, there's some glass container capacity that's offline and the duration of which is sort of uncertain at this time. Have you had any inbounds from specifically your beer customers, saying, "Hey, look, you know, we were previously looking to put our beer in glass containers and now there's a shortage." I don't know how much slack capacity there is for the incumbent suppliers in continental Europe to take that on. Is that an opportunity as we sit today, or is that gonna be offset kind of by the normalization of consumption that we're hearing about, you know, kind of in the UK? I think there is some degree to which that is offset by the changing consumer patterns. As we go into Q2, and we have a sense this is true for the industry, we're all pretty capacity constrained anyway. I think that will find its way probably into the other players in the glass industry is my sense of it. Yeah, I don't think we're hearing that specifically from customers. Not that they, you know, they often don't explain all the reasons for why they're pulling demand, but I've not heard that one specifically. Okay. The last one for me, has anything changed with the magnitude of your existing investments or potentially, I guess, future, other than COVID related or supply chain related delays, in dollar terms or number of lines slash number of units that are gonna be commercialized here in the next 18 months? No, not since our last update. There are some small delays to the Brazil projects, some equipment delays on the project in the Northeast in Alagoinhas, and we had some delays finalizing the land acquisition for the greenfield in Minas Gerais. Given that we had a soft summer this year, that essentially actually means that we've got a very appropriate ramp up timing of our capacity to the demand. Apart from that, you know, all the projects are scaled exactly as we had described them in the last few calls. Yeah. I think the one thing I'd probably add to that is we look to take advantage of economic financing opportunities where they arise. Where leasing opportunities arise that allow us to preserve some cash flow, then we're taking advantage of that. Thank you. Thanks. A final reminder that it was star one if you have a question or comment. We'll go to George Staphos with Bank of America. Your line is open, George. Please go ahead. Thank you very much. Hey, guys. Two last ones from me. On the dividend, if in fact the financing market remains tighter than you would like, and you can't do the preferred with the timing that you would wish, would that alter at all your views on both the regular dividend and the $200 million, you know, in the Q4? The second question, you know, again, Gabe had touched on this, you know, we've been hearing from a lot of the other, you know, rigid companies thus far during reporting. You know, one of them talked about a move that they're seeing, which typically happens during weaker economic periods to returnable glass and formats out of one-way. Are you seeing anything, and I'm assuming the answer is gonna be no in terms of a larger shift to returnable packaging to glass out of one way in Brazil? Assuming your answer is no, why aren't you concerned? Thanks, guys, and good luck in the quarter. Thanks, George. Yeah. Look, I don't have a lot to add on the prep. I think we're confident in our financing activities and in our dividend policy. I think that on Brazil the answer is no. We don't see a long-term shift back to returnable. It's a very difficult thing to shift back because essentially the consumer gets comfortable with cheaper beer in the off-trade. I think that but what you can see is, as you said, and you've had the experience over many years, when there is a lower economic activity, there can be a shift back there for margin reasons on behalf of the suppliers. I think that it won't stick, and I think it's linked a bit to the opening up again of the on-trade. The reason it won't stick is because then the market participants will go back to promoting in the off-trade and gaining share. We've seen all of the strategies of the major brewers in Brazil align around that in the last few years after a period where some were more off-trade focused, some were more on-trade focused. Now we see all of them very off-trade focused. I think it is also a feature of a period of lower demand overall, and therefore, you know, you might as well take some margin in the on-trade. I think that we don't see that as a permanent feature. I think that from what we've seen in other geographies, these systems, once they start to decline, they actually become, as we've talked about, subscale, and they can actually collapse and get significant demand going into the one-way packaging. We also see strong demand on one-way packaging, you know, both cans and glass in Brazil. I think those trends are gonna persist, and what we're seeing is just a temporary phenomenon. Relatedly, you know, one of the brewers is adding self-make glass capacity, and this is not a super new concept. I think it's been out there for a little while. But again, you know, why aren't you troubled by that, you know, relative to obviously the investments you're making in cans in Brazil? Thanks, guys. I'll turn it over. Okay, thanks. I think, George, just because of the shortages in both substrates. I think that there is a significant shortage in one-way glass as well as in one-way cans. And where we see all the market trends going in Brazil, we see both needing significant additional capacity. That particular capacity build doesn't concern us. Thank you very much. We'll go next to Edward Brucker with Barclays. Ed, your line is open. Please go ahead. Thanks for the question this morning. You know, Russia is a producer of aluminum and really a large energy exporter, especially in the European area. I just wanted to see if you've seen any supply chain issues with either aluminum supply or energy availability in the Q1, and then how you're looking at it for the rest of the year. Sure. Yeah, I think on the aluminum side, we don't see any impact. A lot of that was ending up in rolling that was produced and used within Russia. None of our supply sources were dependent on it and, you know, we see plenty of other sources, upstream. We're not concerned on that piece of it. Obviously, the energy is the key one. You know, we don't know better than anyone else at this current stage. It appears that the gas is still flowing, and while it's still flowing, although it's expensive 'cause of concerns over disruption, industry continues. As long as that's the case, we'll be fine. Honestly, as I say, we don't know better than the next person at this point. We're assuming it will continue in the projections we've given you today. Got it. Then, onto the balance sheet. You know, leverage is up to 4.2 x above your leverage target range. Just wanna get your thoughts on how you plan on getting back to that leverage target. Is it gonna be solely through earnings, or do you see an opportunity to reduce debt? Or is it getting to that leverage range kinda contingent on getting that preferred shares done? No, I think the overall plan, you know, projects significant earnings growth, and that is our main way with delevering, and we'd always plan to have a phase of being a little bit higher than our targets and then coming down over time. I'll pass to David for any more. Yeah, no, look, our leverage at Q1 is exactly actually in line with where internally we would have targeted. In fact, it's just fractionally below. As Ollie illustrated in his prepared remarks, the cash flow conversion on the EBITDA is so strong that that gives us a natural deleveraging effect very quickly. With no other questions holding, I'll turn the conference back for any additional or closing comments. Thank you everyone for your time, and I look forward to talking to you next quarter. Ladies and gentlemen, that will conclude today's call. We thank you for your participation. You may disconnect at this time.