All right. Good morning, everyone, and thanks for joining us. You know, it's my pleasure today to welcome Ball Corporation. We have Dan Fisher, Chairman and CEO. Thank you for joining us. Thank you. It's good to be here. Yeah. No, Dan, you know, wanted to maybe start to open up the floor, see if there's any kind of introductory comments you wanted to make, and we'll start there. Yeah. So for those that are new to the story, we are the 100 and almost 44-year-old Ball Corporation. Mason jars, people know us by that. We don't make them anymore. My mom doesn't fully appreciate that. As I have wine glasses and things of this nature that she sends me every Christmas for, with Ball on it. But, our oldest business, and I guess what's in the the largest item that's come up since our earnings call, is we have agreed in principle with BAE to sell our aerospace business. Our aerospace business is actually our oldest current business in our portfolio, nearly 70 years old. We've hinted at this years and years. I've got a lot of questions from folks here. It's like, "What? I don't understand, an aluminum packaging business with an aerospace presence? But we've had such a great run over the last 5-6 years in that business, really picking itself up off the floor, had only $600 million of backlog 6 years ago, and right now we're sitting on nearly $6 billion-$7 billion. We made a ton of investments there. I think we were at an inflection point where, can we do this again? Can we double this business again? Given the current environments and the valuations and the multiples, and the fact that it really was underrepresented in terms of our share position and our market cap, we started a process in January, went through that, got to a great outcome. Right now we're in the throes of getting through the regulatory process, and at the outcome, we will be a pure play aluminum packaging business. We're big believers in the circularity story of aluminum, as are most people, and so we're gonna lean into that and, probably have an investor day here in the first half of the year to lay out, kind of our 2030 vision. Very excited. Many people in the room and at the conference know, we also made an announcement the last couple of weeks with, Scott Morrison will be retiring as CFO after 23 years. I've had a number of people ask me, it's like: "Why is he leaving now?" It's like, he's 61, he's done that job for 13 years. You clearly don't know how fun these jobs are. So it's, s o he's gonna go off into retirement, and we've got a wonderful CFO inbound candidate. Howard Yu is gonna be stepping in September 25th for us. So Scott's gonna stick around for the next year to make sure we get through the aerospace transaction. But those are, I think, the two fundamental big-ticket items that we didn't cover in the last quarter call. And I'm sure we'll touch on Bud Light at some point here, but I think that's probably the more meaningful and more germane things. Everything else is playing out in line with our expectation this year, with the exception of, I think, the Bud Light mass beer issue in North America. Yeah. No, that's a, that's a perfect overview. And, you know, maybe just start out, sticking with the, with the deal announcement and, you know, the CFO announcement. So lots of changes kind of on the financial side that, that impact, most likely your capital allocation. So just, you know, can you just remind us, how are, how are you kind of thinking about capital allocation as you think about the next few years? Or maybe how does your strategy shift now that aerospace won't be part of the portfolio? In particular, I think on, when the deal was announced, you had talked about, you know, proceeds for kind of low carbon initiatives, right? So we'd love to kind of unpack that a little bit more, like what, you know, what are you looking to invest in, and what's kind of the interest there? Yeah, I think I'm getting quite a few questions. Okay, you've got a bit of a Danaher, Emerson background, you're bringing in somebody from Danaher. Does that signal a departure from EVA or a different way to look at capital allocation? No, it doesn't. Regardless of what you call it, EVA, return on invested capital, or cash generation, we're going to be doing the appropriate shareholder returns for our stakeholders. And it'll return to and mimic sort of how we behaved prior to the growth inflection. So, if we talk about specifically the proceeds related to the aerospace deal, there'll be $4.6 billion of cash after tax. And we've outlined, if you haven't seen this. We did a brief investor call on this. Nothing's changed relative to our allocation of proceeds, but $2 billion roughly gets us to sub-3x gearing. Historically, we've been in that 3x-3.5x. I think the ceiling probably looks closer to 3x right now for the foreseeable future, given the current interest rate environments. We've earmarked roughly $2 billion for share repurchases. That'll come over time, and it'll be a combination of mechanisms, whether it's ASR or spot opportunities. We'll probably have to lever multiple windows and optionalities in order to get that done in an abbreviated timeframe. Then we've got $500 million-$600 million that'll be on the balance sheet for opportunistic things. And to your point, in this, what you need to do in order to see a significant shift for aluminum is you need to lean into the low-carbon aspects and drive that further, and they need to be low enough cost to make sure that the representative change for folks that wanna move out of their core products, they can do that in a less impactful margin, rationale. And so many times when we're talking to investors, we talk about the carbon footprint in Europe, North America, and in South America, and they're vastly different. And in fact, Europe is the worst in terms of the carbon footprint. In South America, it's the highest recycled content, highest recycling rate in the world. It's hydro power, so we're sub 20 grams of carbon on our products there. If we can mirror that in the other regions, you're really off to the races in terms of the arguments that reuse and RPET and glass, et cetera, it's like they really don't have a real competitive advantage in terms of practicality of how those would play out in the marketplace. So that's. With the speed with which decisions are being made and regulated in Europe, we may have to help to influence supply chain, scrap streams, remelt facilities. It's not gonna be a lot of money, but with the combination of subsidies that are available and making sure that that infrastructure keeps pace with the opportunity set, that will occupy some time and some thinking. There's nothing imminent on the horizon, but we'd be thinking about that. Do you foresee that that's gonna be kind of more aligned with partnership style approach and just working kind of as an industry? Or are there any areas, you know, as you think about your own offering, that you can do just kind of by yourself in terms of investments, to kind of progress and continue to think moving forward, particularly in those regions? It's yet to be determined because so many things are being negotiated in the regulatory environment. So if there's an opportunity for us to, you know, create a, alloy can or participate... What we do know is scrap is gonna go up. You know, scrap values are gonna go up everywhere for electric vehicles, et cetera, et cetera. And you need to make sure that there's an appropriate amount of that going into and back into our supply chain so that we can make the claims that we need to. So recycling rates need to go up. There could be infrastructure investments that have to happen. Thankfully, in the IRA bill, there's been about $500 million that have been earmarked into investments into the recycling streams in the United States. In Europe, it works differently because each country controls their DRS legislation and things of that nature. So, we'll be opportunistic, and we're also gonna partner with our biggest customers. And, you know, some of them are sole supply in cans and are 100% in cans, so that can, for them, has to be something that they can claim, and they can see progress because of the vast amount of reporting, specifically in Europe, that's gonna start in 2024 and 2025. So they're gonna be held accountable. There are already lawsuits on greenwashing happening at a pretty record pace over there. So we wanna provide, and what we've done for the last handful of years is been able to sit down with our customer and say, "We're working on this in terms of materials of concern on coating. We're working on this and committing to this in terms of recycled content." It's in our supply agreements, it's in their agreements, but we need those things to show up. And I think in Europe, it's the most pressing area. The most opportunity for us, we're 30% can penetration versus 50% in South America and North America. So Europe's got a lot of opportunity, a lot of upside, but we need to make sure that the infrastructure and the supply chain is there to step into, so we can manifest those volumes. That, that makes a lot of sense. And, you know, maybe stepping back a little bit and thinking more kind of longer term, I, I realize it's a little early, and there's just a lot of things that have been changing, right, in the last couple of years- No, you say. Yeah. But, you know, as you think about the 10%-15% earnings growth in the algorithm that the company has had, as you mentioned, Aerospace, the growth there has been very strong for the last few years, and it was starting to, you know, accelerate even more in the last year. So is that, as you think about pro forma, you're, you know, more of a pure play, can business or aluminum can business, and everything that's been happening with the secular story, you know, over the last couple years, maybe being challenged by some of the underlying dynamics, COVID, supply chain, et cetera, is 10%-15% EPS growth still the right way to think about Ball going forward? Or how do those dynamics kind of impact how you're seeing that earnings growth? I think definitely. I think we're within that window. Next year will be, depending on how you're looking at the business, if it's as reported with aerospace in it, obviously, the regulatory timing and when we are able to repurchase shares to kind of offset the earnings dilution there, will play into that. But I think what's important to understand is, yes, aerospace is growing, but you're fixed into 10% operating earnings in that business. To go, you know, government business, it doesn't generate a lot of cash. 95% of our cash is generated by our aluminum packaging platform, so that's all gonna be there moving forward. And then we won't have to be leaning into the accelerated investment curves of aerospace, which the programs you're working on now and with the things that you're investing in, in many instances, you're not gonna see revenue dollar for five, six, seven years. So it's, you might get the EPS. I'm not entirely sure you're gonna get the cash generation on that. And yeah, we're excited to return to once we get our debt down, the business fundamentals continue to improve. We're seeing inflections in South America and some other areas, so you'll see dividend repayments. We'll adjust that to ensure the yield associated with the share buybacks. And we've made capital investments over the last 2-3 years. We should be returning back to in line with D&A, GAAP D&A, in terms of capital, for the next two-three, maybe four years, depending on where the world is, in terms of growth dynamics and how much better we can run our facilities to gain productivity and a lot of the new assets we put in the ground. So you should see us buying back shares at a pretty accelerated clip moving forward, and we still have money within that $600 million-$650 million to keep pace with the growth. And so I think we're in a really good position as the world starts to maneuver and inflect around the world. You should see a lot more profit, a lot more cash, and in return. not opportunities outside really of aluminum packaging that we want to step into at this point. No, and maybe that's a good segue, you know, as we think about, the aluminum can and the growth trajectory there, right? I think pretty challenging environment over the last couple of years. Again, a number of different factors, kind of outside of your control, and secular story still seems, healthy. So just, you know, I think, one of the last or I guess last year or earlier this year, you lowered kind of your expectations for the North America growth to 2%-4%, but the global was, was kind of cut that 4%-6%. So, you know, could you just kind of help us? How are you seeing that? Are those still kind of the right growth rates, kind of over the medium term? Or, you know, and as you think about maybe more near term, how are those kind of progressing in terms of what you're seeing? Yeah, if you're, I think if you're looking out to 2030, you should be thinking about North America in that 2%-4% growth range. You should be thinking about Europe and South America in the 4%-6%. So probably the net is 3%-5%, given the size of our North America business today. I don't see the 2%-4% happening, for us, in particular, in North America next year, given that we'll have a four- to five-month overhang from the mass beer challenge that befalls us right now. But the way we're looking at these regions and inflecting into 2024, if you want to talk about 2024 in particular, we started the year talking about 2023 in South America, with an incredibly weak first half, it manifests in that range. And then in the second half, we thought there would be a lot of inflection. We thought the economy would get better, which it is, and we also have a major customer down there that had a hedge rolling off. So what was actually their cost on their PNL relative to their aluminum position was markedly higher than what the actual LME was running at. So they stepped into much improved economics, and we're starting to see cans grow. We're also seeing a return to elements of a share shift back into cans over an inflected period of time in high inflation, high interest rate environments in places in South America. You'll see returnable glass take 5 to 6, 7 points of share, and then it returns. We've seen it the last two economic cycles, so we should see not only improved economics, we should see some substrate shift back to normalize over 2024. Pretty easy first half comps that should materialize in decent growth there. In Europe, the end consumer is definitely weaker than it was in the first half of the year. I think everyone's hearing that in all industries. We're still growing. We have a really good diversified portfolio, and we have some dry powder with new facilities that we've started to ramp up. We've got a Turkey business that hopefully, God willing, those folks get back to a more sense of normal there. So I think Europe, you'll see kind of low to mid single digits. Then in North America, for us, a couple things have to happen. How is mass beer gonna play out? And we can go into that here in a second, but in the CSD and in the CSB environment, everybody's recognized how expensive things have gotten for a 12-pack of cans. Pretty easy comps for the folks that participate in that marketplace, given the sizable price increases they had at the tail end of last year. Those have carried through. They'll be in a more competitive dynamic in terms of flowing through improved results in Q4. They will have to depend more on volume, and you're seeing, you're seeing an inflection a little bit in that private label is finally taking share. That means the brand loyalty, as much as it's there in some of those brands, they can't afford it. So we have anticipated all year, not a lot that's gonna happen in the first three quarters, but we do sense a bit of an inflection that will happen in Q4, and then that will help us moving into 2024 in North America. But we're flat to slightly up in North America, and for us, that would probably mean that the industry is up because we've got more exposure to the folks that are dealing with the mass beer issue. I do want to remind the audience, if you have any questions, feel free to just raise your hand and we'll get a mic to you. But, you know, I do wanna dig a little bit more into mass beer. Just, you know, what are you hearing? It's such a fun topic to talk about, as somebody who grew up in St. Louis. And just to add to all the, you know, dynamics that have been taking place already, as if there weren't enough challenges out there. But I think, you know, in one of the earlier calls this year, you talked about it. There was still a little bit of, you know, a dynamic of not sure if it was gonna be a positive longer term, you know, if you see a shift to other brands where you might have some exposure, versus a negative. So can you just help us understand, one, what are you hearing from your customers, and, and how does it impact Ball kind of this year or next year, based on what we've seen so far? Yeah, I think it's a good longer term and how we define longer term, probably 24 months out, it's a positive for us for sure in that reset. Because the brand that's being impacted, they have 50% of their volume comes out of their captive asset base. The other 50%, we participate at a higher rate than anybody else in the industry. And so we're impacted more in the beer space, but we also have really good relationships with all the other brewers. In the short term, how I'd look at it is, I think in the simplest way, you'd say, "Well, I'm not gonna buy that brand, so I'll go over here and buy this brand." Fair enough. I think Bud Light is bigger in terms of beer can volume than Constellation Brands in total. So okay, it doesn't necessarily work like there's a huge scale differentiation here that's gonna play out over a period of time. The other thing is you're not gonna see much movement. There's incremental benefit to a couple players in the space, but from March, April to August, September, those breweries are running all out. The issue is: When are they gonna be able to brew more beer to take advantage of new retail sets, et cetera? That won't manifest until now. Starting now, and I think you're seeing it in the form of a lot of advertising that's coming out from all the major brewers, and retail shelf sets are being discussed. You haven't seen a lot of tap handles move away yet, so all of that is going to play out. But what has to happen is there has to be more beer brewed on those brands, writ large, to step into the idle capacity and the lack of velocity on the shelf that's being occupied. So I think you'll start to see now over the next six months, you'll start to see craft, excuse me, mass beer start to inflect higher. But you've got so for the year, it's gonna be down, and it's gonna be down because of this phenomenon that happened during peak season for those brewers. But it will start to inflect, and then it will be interesting to see how fast somebody like Constellation, that was already growing, how fast can they move things forward to take advantage of this? And the folks that do have dry powder, are they willing to invest? It looks like there are signals to say that that will happen. The bull case is ABI figures it out, and they replenish that. The bear case is this is gonna take 18 months for that to all settle in, from our expectations. Yeah. Now, and maybe taking a step back. So we will get better incrementally. If you look at May next year forward, those are gonna be great comps for us in terms of this space. We will continue to get better, and I don't think it will be completely offset, but we will get marginally better. There will be mix. There will be opportunity sets. On-premise could be very interesting. E-commerce channel could also fill the void, 'cause I don't think there's gonna be a lot of folks that pick up a certain brand's bottle on-premise for a long period of time, but maybe they'll drink out of a can at home at the appropriate price. So all of those phenomena. Of course, we make cans for a living, so I'm not a marketing person, but there you go. Now, maybe sticking to the cans now, you know, I think, taking all of what's going on, particularly in North America, what does that mean for utilization rates for the industry? And, you know, over the last couple of years, we've seen delays of new capacity, curtailments. Is the industry and Ball in a better place now from a utilization rate perspective, or is there more kind of incremental, you know, initiatives that maybe need to take place? I think in the short term, the industry has got excess capacity. It's got excess capacity because of Bud Light. We're sitting with that excess capacity, and if you're new to the industry or you. It's like, you want us to have excess capacity. We're good stewards of how to manage that and those curtailments. We believe that cans are gonna grow, and we're in an inflection point, and it will be filled with something. But for us, we'll be sitting on probably more excess capacity in the marketplace for the next 12-18 months than we saw heading into this marketing issue. But we will manage that, and we're managing that really effectively right now, so. Is that just essentially curtailments, fewer shifts run, or do you see the need to actually shut down anymore? It's curtailments for us. Yeah, if we thought this was, if we thought that this was a permanent shift away into the potential for wine or spirits or something like that, we may come out and talk about footprint decisions. But we're definitely in an optimized b ased on the actions we have taken over the last couple of years, we're in a position where we're optimizing our footprint. Mm-hmm. And maybe, you know, as you think about, going back to what you had mentioned earlier, you know, and promotional activity and perhaps as you start to see private label take a little bit more of a step forward, I guess, are you what are you seeing in promotional activity? Do we should we expect that to kind of accelerate a little bit more in 3Q, or what are you kind of hearing in terms of that dynamic from your customers? Yeah, the I think the misconception is, and just it's probably the nomenclature. There is promotional activity. There has been a lot of promotional activity. It's just the depth of the promotional activity. So if you're, if you're sitting in the big CSD houses, what you're trying to do is, like, if we can get to flat volume, they'll promote to that point. We got all this price coming through. Historically, there's a 2-to-3-to-1 price elasticity benefit, price, price to volume. Right now, it's 10-to-1. So that, that starts to compress. When you see private labels show up, now you're, now you're basically hearing that I'm loyal to that brand, but only to a point. And it's really a governor, too, on those CSD providers to say, "Okay, we've probably pushed this lever." Now they're, now they're going to materialize in a very different behavior, I believe, moving forward. It'll return to probably pre-COVID behavioral patterns in terms of price, promotion, marketing, et cetera. What you're seeing in terms of the beer folks right now, heavy advertising. So if the advertising doesn't work, they'll, they'll do the promotions, and, and they'll move to the discounting. So you first see, you first see heavy advertising, and then you, then you move to, "If that's not having the intended effect, we'll take some of that money, and we'll, and we'll materialize it in price promotions," as you, as you stated. Maybe, you know, specific to Ball, one of the factors I think you had highlighted at your Investor Day was the $200 million of cost savings, $150 million as well, in terms of o r sorry, inflation recovery, $200 million and then $150 of cost savings. You know, how are you progressing on those? And, you know, as you think about the contract structure, are we in a better place that, you know, you kind of, you feel good about the next couple of years from a margin standpoint and where that should go? Yeah, I don't think there's been fundamentally changes to the contracts. I think historically, when you look at our North America business and our European business, we had inflationary pass-through mechanisms that worked really, really well. They're a year in arrears, and so if you're in a 2%-3% inflationary environment, your customers would expect that you can offset that with productivity gains of 2%-3%. So we behaved in that manner. And then 2021 and 2022, you're playing catch up, and finally, this year you're seeing it's not only that we got the $200 million pass-through, 'cause last year we got $100 million of inflationary, it's that it was more than offset by more inflation hitting you. And right now we're in a flat PPI environment. So the $200 million is flowing through. We're getting it. We had $90 million of SG&A action we took at the end of the year from an annualized standpoint. We're seeing that. We took $75 million of fixed cost out in terms of our footprint. We're seeing that. So that's all showing up in the P&L right now. Depending on whether there's inflections in inflation in the back half of the year, that's flowing through. The $200 million on an annualized basis is much higher because 60% of that $200 million happened 1 July. So you'll see that again next year, coming in on the first half of the year in North America. Most of the residual amount came through Europe. That started at the beginning of the year, so not a lot of carryover in that environment. But about 70% of the $200 million that we got this year started in two and three and will carry over into the first half of next year. You know, as you think about maybe getting beyond all of these kind of dynamics that are happening in the next 12-18 months y ou know, mass premium continuing to be a challenge, longer term, what's kind of a normalized margin that you think kind of is achievable for, for the business, sustainable? Yeah. It's the margin as a percentage is not something we really track given the LME volatility, but we should be more profitable in every one of our businesses, even versus 2019 thresholds. You look at Europe this year, we lost or had to divest, was it this week? This week or next week, we divested our Russia business. There's $83 million on an as-reported basis, year-over-year, that we lost. They're gonna offset it this year. That means all the other cans are significantly more profitable. We're more profitable in North America, to a pretty extensive manner, and in South America. I would say North America and South America still have ways to go because we've made some pretty significant capacity investments there. They've fallen into some pretty disruptive volume environments, so there's some fixed cost absorption elements that'll tick us up. When we look at gross profit dollars, in terms of the unit volumes that are coming across the lines, we should be better than 2019, probably over the next year or two. Mm-hmm. And maybe kind of lastly, you know, from a defensive nature of the industry, obviously, a lot has changed in terms of the way that maybe CSDs have kind of behaved over the last, you know, couple of years, getting priced. Do you see that changing in any way, just, you know, more structural, just given that they've seen the ability to get that? Or are we just gonna go back to maybe a more steady dynamic, kind of 18 months from now or 12 months from now? Yeah, I think it will absolutely be a more steady dynamic. I just think the end consumers are stressed in a way that, I think the stimulus money, people got their balance sheets in really good order. They took advantage of the low interest rate environments. I think that's been consumed out of the economy in a way that-- and people paying $6-$7 at the gas tanks. It's like volume, o nce volume moves at the rate that it is, in. One of the CSD providers, I think, is down 6%-7% in this quarter. They've got to take action heading into the fourth quarter. So I think they've pushed that lever as hard as they can. Once you see private labels coming back in and volume declining, look, they have size and scale in their distribution pattern, so they have to keep it full, or they're gonna de-lever just like all of us. Everyone needs volume at some level. And I think we're gonna be entering into the seismic shifts and the volume up and down through COVID and the supply chain disruptions. I think you're gonna get to a more normalized environment, and they'll be back at fighting for shelf space and market share and all those fun things. Makes a lot of sense. Yeah. I think that brings us to time, so thank you so much for joining today. Thank you. Yeah. Appreciate it. Good Good to be with you. Take care. Thank you.