Good morning and welcome to Crown Holdings' first quarter 2025 conference call. Your lines have been placed on a listen-only mode until the question-and-answer session. Please be advised that this conference is being recorded. I would now like to turn the call over to Mr. Kevin Clothier, Senior Vice President and Chief Financial Officer. Sir, you may begin. Thank you, Elle, and good morning. With me on today's call is Tim Donahue, President and Chief Executive Officer. If you don't already have the earnings release, it's available on our website at crowncork.com. On this call, as in the earnings release, we will be making a number of forward-looking statements. Actual results could vary materially from such statements. Additional information concerning factors that could cause actual results to vary is contained in the press release and in our SEC filings, including our Form 10-K for 2024 and subsequent filings. Earnings for the quarter were $1.65 per share compared to $0.56 per share in the prior year quarter. Adjusted earnings per share were $1.67 compared to $1.02 in the prior year quarter. Net sales in the quarter were up 3.7% compared to the prior year quarter, reflecting a 1% increase in global beverage can volumes, a 16% increase in North American Food can volumes, and a pass-through of higher raw material costs, partially offset by lower volumes in Transit Packaging. Segment income was $398 million in the quarter compared to $308 million in the prior year, reflecting higher beverage can volumes in Americas and European Beverage, increased volumes in North American Food, and improved manufacturing performance in the beverage businesses. The company returned $233 million to shareholders in the first quarter of 2025, including $203 million of share repurchases, after returning $336 million in the full year of 2024. The company had a strong first quarter, with year-on-year improvements in segment income, adjusted EBITDA, and free cash flow. As we look forward, the potential impact of tariffs creates a wide range of possibilities, including potential slowdown in consumer industrial activities. With all this in mind, we're raising our guidance for the full-year adjusted EPS to $6.70-$7.10 and project the second quarter EPS to be in the range of $1.80 compared to $1.90. Our adjusted earnings guidance for the full year includes modest changes in certain assumptions. We now expect net interest expense to be approximately $360 million, exchange rates assuming Euro of 1.08 to the dollar, non-controlling interest expense to be $160 million, and dividends to non-controlling interest are expected to be approximately $140 million. Remaining unchanged are assumptions for a full-year tax rate of approximately 25% and depreciation of approximately $310 million. Also unchanged, we currently estimate 2025 full-year adjusted free cash flow to be approximately $800 million after $450 million of capital spending. At the end of 2025, we expect net leverage to be approximately 2.5 times. With that, I'll turn the call over to Tim. Thank you, Kevin. As always, a sea of numbers. Good morning to everyone. As reflected in last night's earnings release and as Kevin just summarized, Crown got off to a tremendous start in 2025 with segment income up 29% over the prior year. First quarter beverage can segment income improved 24% over the prior year, led by higher-than-expected shipments in the Americas and Europe. Outstanding manufacturing performance globally, including some additional benefits from the prior year's Asian capacity optimization program, also contributed to the excellent results. In total, earnings per share were significantly ahead of last year, reflecting a quarter in which we executed very well. Americas Beverage reported a 25% income improvement over a very strong first quarter last year. This was led by higher-than-expected quarterly volumes in North America and Brazil, up 2% and 11%, respectively. The segment also benefited from high utilization rates as we build inventory for what looks to be a strong summer selling season and a tightening supply situation. With little direct tariff impact in this business, we'll keep an eye on consumer demand as the segment strives to achieve income of $1 billion. European Beverage volumes improved 5%, with growth noted throughout Eastern and Southern Europe and the Gulf States, leading to a more than 30% increase in segment income in the quarter. The conversion to the aluminum beverage can from other substrates continues and almost feels as if it is accelerating, leading to what we expect will be a very tight supply situation for the segment in the summer as well. Again, we expect very little direct tariff impact to this business. Income in Asia Pacific advanced 12% in the quarter, reflecting two important items: the continuing benefits of our efforts to improve revenue quality and our ongoing cost reduction programs. These offset the volume impact from the closure of an underutilized regional facility. We do expect the Asia Pacific region to be more sensitive to current global trade tensions, so we continue to watch consumer demand there closely. As expected, transit performance was down in the first quarter as subdued industrial demand continues, most notably impacting the higher-margin equipment and tools business. In our view, the transit business is the business that could be most affected by tariffs, both directly and indirectly. For 2025, we have estimated Crown's potential income exposure to be below $30 million in total, below $10 million of direct exposure, and the indirect exposure, that is, lower spending by our customers given uncertainties in the business environment, to be below $20 million. It is important to note that these are just rough estimates at this time and only our best effort to estimate the range of risk that may or may not occur. These estimates are included in the revised guidance shown in last night's earnings release. First quarter volumes in North American Food advanced 16% on the back of increased demand from vegetable and pet food customers. When combined with improving two-piece food can manufacturing performance and a flatter tin plate steel environment in 2025, income in Other increased $21 million in the quarter. Reflecting on the first quarter, the beverage can businesses are off to a very good start, with the momentum carrying through to the end of April. On a global business, we continue to generate improving margins necessary in our view, considering the amount of capital and manufacturing know-how required to efficiently run beverage can lines at high speeds. Both 2023 and 2024 were record EBITDA performances for the company, and 2025 is poised to set another record. While the world may feel a bit uncertain, we are well positioned in our markets, and we are reminded in times like these that it is good to be in the can business. Operationally, in the first quarter of 2025, it was outstanding. To summarize, segment income was up $90 million, trailing 12 months' EBITDA is now above $2 billion for the first time, with EBITDA margins up 260 basis points in the quarter. A significant increase in North American Food can volumes, led by pet foods, improved cash flow from operating activities, now positive in the first quarter. We returned more than $200 million to shareholders, with minimal impact to our leverage versus year-end. Lastly, we want to thank our more than 23,000 associates globally for their hard work and dedication they display each day in supporting Crown's customers. As important, I want to congratulate the entire Crown family, as together we have surpassed $2 billion in EBITDA for the first time. With that, Elle, I think we are now ready to take questions. Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star and then the number one. Please unmute your phone and record your name and company name clearly when prompted. Your name and company name are required to introduce your question. To withdraw your request, please press star and then the number two. Our first question comes from the line of George Staphos from Bank of America. Your line is now open. Thanks so much. Hi, everyone. Good morning. Thanks for the details. Good morning, George. Hope everyone's well on your side of the phone. Tim, can you talk to whether your customers are changing any of their normal behavior going into the seasonal peak period? What I'm really trying to get at is, is there any anticipatory buying on their part ahead of maybe higher aluminum? I know you said it wasn't a direct impact in what you see, but can you give us a bit of color on how you're seeing that play out in that of one or two follow-ons? Yeah. George, on the beverage can side, the inventory, let's say the inventory, whether it's empty cans or even filled product that our customers hold, is pretty short. I mean, we are oftentimes, we deliver cans within a pretty tight window. Their demand is a pretty tight window, and they take the cans, they put them through a can washer, and they fill them oftentimes within 15 to 30 minutes from our delivery. I don't think on the beverage side we've seen any of that. In fact, we've seen the LME come down quite a bit since the specter of tariffs was announced, and it's been bouncing around a little, but I think the LME is much cheaper today than it was earlier in the year. Now, having said that, it's offset a bit by the Midwest Premium, but they have a lot of levers to pull, the beverage guys. I think on the food can side, perhaps in North America, there may have been some pre-buying ahead of what they thought would be the tariff implications on two-piece steel. As you know, as well as anybody, George, most of the two-piece steel used for food cans in the United States comes from the European suppliers as the U.S. suppliers are not capable and seem unwilling to invest to supply the full needs of U.S. manufacturers. I don't think we've seen a lot of that happen yet. I think I'll save the other answer for a different question, perhaps, but I think Kevin and I spent a lot of time talking to the teams trying to understand if there was any pre-buy that was going on. We didn't get the feeling that there was a lot of pre-buy. If we want to sit here and make ourselves feel better and hedge the first quarter a little, if the first quarter was $50 million or $60 million better than we anticipated, could $5 million or $7 million have been related to that, yeah, but boy, the overwhelming majority of the beat against what we were expecting is just strong volume and really good execution. Appreciate all that detail, Tim, and that's good to hear. One more question on behavior change, but really more at retail. Are you seeing any signs of willingness, either by the brand owners or the retailers, to promote more? Is that maybe what you're seeing on the food side, if you can parse it? My last question, and I'll turn it over. I recall there being some view that in 2025, there'd be some margin compression from PPIs in Europe. Didn't seem like it was much of an effect, but just wanted to check in on that and see what effect, if you can relay, that might have had and will have in 2025. Thank you. Good luck in the quarter. Thank you. I would say on the food can side, I do not think there is any tremendous promotional activity going on. I think what we are seeing is that one of our large pet food customers coming out of COVID was exceptionally bullish on what they believed their opportunities to be, and I think we are starting to see those opportunities manifesting themselves to the benefit of the customer that we supply and our large customer in pet food. Some of the vegetable guys that we supply, some of them are less seasonal than others, packing a variety of vegetable products, southern vegetables especially, and they are doing quite well. I think it is customer mix. Could be a little pre-buy in there, but I think it is largely customer mix that has gone in our favor. Your comparison's easy too there. In any event, too, we should remember that. Please go ahead, Tim. Yeah. On the European question, George, I think, listen, I think as we began the year, we expected to see some headwinds on what you would describe as PPI or CPI in the various formulas we have throughout Europe. I think that's been overwhelmed by volume, and I guess I'll get to it now. I was going to save this for another question, but it begs the answer now. I think what we're saying, as I said in the prepared remarks, is that we expect a really strong summer selling season. We think the conversion from other substrates is accelerating. I know it's too early to call. It's only one or two quarters of data, but for example, I had the European team give us, by country, liters of consumption versus can growth. In all cases, can growth is 2-3, sometimes 4% greater than consumption of liters. Either we're selling a lot of small cans or there's a substrate shift happening, and I think it's a substrate shift ongoing and accelerating. I think to the extent that we were concerned with PPI, that PPI is going to be there, but I expect that it's going to be overwhelmed by volume gains. Thank you very much, Tim. Thanks, George. Thank you. Next on line is Phil Ng from Jefferies. Your line is now open. Hey, guys. Congrats on another really strong quarter. Tim, you gave us some color on why you think you haven't seen any pre-buy in Americas, but any color on how trends are shaping up in March and April? Just kind of get a read on what you're seeing out there. Have you seen any slowdown in orders and whatnot? No. As we said in the prepared, we might have even said it in the, I think, Kevin's quote in the release and in our prepared remarks, the firmness that we felt in demand throughout the first quarter, we've seen carry through to the end of April. It does feel like, and I know I said it a couple of times in the prepared remarks, both as it relates to North America and Europe, it does feel like we're going to have a tight supply situation in both geographies this summer. I'm not ready to say that south of the border, and I'm not ready to say it out in Southeast Asia, but in our big beverage can businesses in Europe and North America, it feels like things are going to be tight. It feels like we're going to have a good summer. I know it's early. We've tried to be cautious with the guidance we've given you. There are some reasons to be cautious with tariffs, but it feels like it's going to be a strong season. I'm not yet ready to say that there's the reinitiation of substrate shift in North America yet, but I certainly am prepared to say it in Europe. Okay. Then the last quarter, you gave us a view of how you're thinking about North America performance for Crown versus the market in 2025 and 2026. Kind of expected to be in line with the market in 2025 in North America and perhaps a little faster in 2026. Any update on that front in terms of, I believe you got some CSD contracts that could be up for renewal on that time frame? Any color on that front? I think that we'll be materially in line. When I say materially, whether we're a half a percent above or a half a percent below in 2025 with the market. In 2026, based on what we see now, we should be ahead of the market. I think same as we've said before. Okay. Then just last one for me. On the transit side, results were actually really stable from Q4 to Q1. I think implicit in your guidance, you're baking in some potential softness from tariffs and whatnot. Curious to hear what you're seeing on the quoting and order side of things. Have you seen any slowdown in activity, anything that's pushed out from a timing perspective on the transit side of things thus far? Yeah. Phil, that's just an absolutely excellent question. We are seeing a multitude of quoting opportunities. Quoting is very high. Actual orders for equipment and other longer lead time items is a little slower than we'd like to see. I think that's a function of customers across a wide variety of industries being very careful with their capital budgets because they're uncertain as to what's going to happen in the economy in general as we look out 6, 9, 12, 15 months. The opportunity for us is, as you point out, we think quite high. We've significantly reduced the cost footprint across the entire organization globally, which has helped us maintain firmer profitability perhaps than you would have expected from a business that has been, I think, improperly characterized in the past as being overly cyclical. I think it's a lot less cyclical than it used to be. Having said that, it still is certainly more cyclical than cans. The opportunity for us when industrial demand returns and customers get more comfortable with their capital budgets and they're willing to redeploy capital to reduce their long-term costs by making the back end of their processes more efficient, that is, by taking labor out, we see the opportunity as being quite robust. Now, in the interim, what's happening, they're taking labor out of the back end right now because they don't see the need for the labor. As they see demand pickup in their own businesses, they have two choices: try to automate the back end of the line or bring the labor back. We're hopeful that they continue on the automation path. Do you have any supply chain stuff with equipment, with tariffs and whatnot that I should be mindful of? As we said, we estimate the direct impact of tariffs being below $10 million. Most of that, Phil, I want to tell you that most of that is equipment that we make for customers in Europe that gets distributed in the U.S. and/or components that we make for ourselves that we then assemble in the U.S., but the components are made in Europe. Most of that is internal, but still subject to tariffs. That would be, as we sit here and look at the balance of the year, assuming that the 90-day holiday on tariffs comes off, and we start feeling that in June, July, that is the less than $10 million. Okay. Thank you so much. Thank you. Thank you. Our next question comes from the line of Ghansham Panjabi from R.W. Baird. Your line is now open. Thank you, operator. Good morning, everybody. Morning, Ghansham. Morning. I guess, Tim, going back to the Americas Beverage segment specific to profitability, I know that in North American volumes, we're up 2%, Brazil up 11%, but the incrementals were just phenomenal, 50% almost incremental margins in that segment. Can you give us a bit more color as to what drove that? Secondly, 1Q is a smaller kind of tail quarter. It's dangerous to sort of linearize trends from the first quarter because a lot can happen between now and the end of the year. What gives you confidence specifically as it relates to your comment about the strong summer selling season? All good questions. Ghansham, what I would say is that as you start running, as you start adding incremental units to factories that are pretty well loaded to begin with, it's all gravy. As you start, it's like a spillover effect. We are running well, right? As you know, we and others have brought up a number of large multi-line, multi-sized factories over the last several years. We are through learning curve on each of those plants, and we're running real well. There's always one-offs here and there, but I don't think there's nothing remarkable to talk about in terms of a one-off. I think these are just incremental volume and running well. I will say that we do believe we were appropriately cautious and appropriately strategic as to how much capital we invested and where we invested and with which customers we invested. I think we're seeing the benefit of that. As to your second question, yeah, listen, your point is absolutely correct. You can't take the first quarter and just assume the rest of the year is going to look like the first quarter. We generally always try to be a bit cautious as we look out to the balance of the year when we're talking to you in April or May. We had a really big first quarter. I don't think you'll want to. I think we're going to have a pretty good second quarter, but in no way should you model the second quarter growth over last year to be similar to what the growth in the first quarter was over the prior year. It does feel like demand is really high right now. Now, having said that, we got a lot of cans we got to sell. You got to get through the second and third quarter, the next five or six months. There are a lot of cans that need to leave the warehouse and get through the entire distribution system through to the consumers, be consumed, and then we start rebuilding inventory in Q4 for the following season. There is a lot to happen, as you rightly point out. Okay. Great. My second question, just kind of going through the earnings season and listening to comments out of your customers across, let's say, the consumer product group ecosystem, they're throwing out tremendous numbers as it relates to cost increases specific to tariffs and so on. Obviously, they've outlined mitigation strategies against that, and will try to take up some price. Just in your conversations with customers, do you sense anything different in terms of how they approach their own promotional cadence and so on and so forth as the year unfolds in context of, obviously, a huge increase in costs? Yes. I mean, as it relates to our business, the tariff impacts, notwithstanding the LME or the Midwest Premium, just the specter of tariff impacts from bringing in primary aluminum from Canada. I think it's pretty well documented that that's about, perhaps, it's 1 cent a can, and it sounds like a lot, but it can be absorbed through to the consumer without a lot of pain. Food can side, a little bit, the food can customers, a lot of these customers are family businesses with great brands, and they have perhaps a little bit less leeway to operate in that environment. Steel tariffs, there's been steel tariffs now for seven or eight years through a couple of administrations, and they're not happy with it, and they need to find a way to deal with it through their supply chains through to the retailers. Food can still offer an incredibly economic way for families to feed themselves with healthy, nutritious foods. We are all going to have to deal with this. We are not, other than tin plate steel that comes in from Europe and primary aluminum, which comes in for the non-recycled piece, which comes into the United States, our industry not overwhelmingly impacted by trade flows from China and/or other locations. It feels like it can be absorbed through to the consumer without massive increases. I mean, remember, our customers took prices up a few years ago in response to the LME hitting $4,000. The LME has certainly backed off a long way from $4,000, and they have not really reduced those selling prices a whole lot. We will see. Okay. Got it. Thanks so much. Thank you. Thank you. Our next question comes from Stefan Diaz of Morgan Stanley. Sir, your line is now open. Hello. Good morning, Tim. Good morning, Kevin. Thanks for taking my questions, and congrats on a strong quarter. Maybe just to start, we had roughly a $0.40 beat in 1Q, 10% guide up at the midpoint. Is this just conservatism, or what are some of the puts in the back half that you're seeing, or is this just the headwinds that you outlined in your transit business due to tariffs? Thanks. Yeah. I would have, I'm assuming that had we not spent some time on tariffs and what the potential impact on tariffs could be specifically in the transit business, that you would have met a forecast for the balance of the year that didn't look like the one we generated with a lot more skepticism than you are viewing the one we did put out there. I think we tried to be thoughtful around what the impact could be, and we tried to provide a forecast that encapsulated what we think we know, understanding that things are fluid and they're changing rapidly. We don't really know if the 90-day holiday here that he's given everybody is going to be extended or what's going to happen. It was our best effort to provide you with something that we thought was thoughtful. Great. That's helpful. Last quarter, I think you guided to roughly $275 million-$300 million of share repurchases. You repurchased a little over $200 million in 1Q. Maybe one, is this still the right range to expect where share repurchases might end up? Maybe quickly, if I could just sort of slip in one more. I think last quarter, you said FX was roughly a $0.10 headwind. Given dollar weakness, what are you sort of assuming for FX now? Thanks. I think you're spot on in terms of share repurchases. We'll purchase somewhere around $300 million, maybe slightly less than that. On FX, we originally assumed, and I'll give you Euro as a reference, at 1.03. We're forecasting now at 1.08. Clearly, a lot of volatility in the FX market right now. If we were to assume the FX rate stayed the same between, stay at 1.14, which is where the Euro is today, it's probably a benefit to us of another $0.05. We have encapsulated some FX gains in our forecast. Thank you. I'll turn it over. Thank you. Thank you. Our next question comes from Chris Parkinson of Wolfe Research. Sir, your line is now open. Great. Thank you so much for taking my question. You've done a lot over the last couple of years in the U.S., Asia, even Europe, just to further improve your operational performance and leverage a lot of your new lines on an ongoing basis. Can you just give us an update by geography on how you think those are going at this juncture, given it's been a few years, and how much is perhaps left for improvement, or do you feel you've already hit your stride? Thank you. Chris, I want to make sure I don't say this and I insult our manufacturing teams, but I think there's always room for improvement. Our manufacturing teams are always looking for ways to continuously improve. Having said that, the performance they've demonstrated over the last several years has been nothing short of what we would characterize as remarkable, given the amount of work required to integrate new factories and new lines, new sizes, changeovers of size, changing customer demands, whether it's size and/or design, and at the same time, expanding margins in the process. I point that out because I think what they've done has been remarkable. It's been a large part of the margin expansion that we've experienced over the last several years. We all know there's always ways to get better. We have—what do we have?—17 plants in Europe and across Europe and the Middle East, or 14 or 15 plants. I'm sure there's one or two that we know we can make better. There's some that are just absolutely tremendous. There's always opportunity to improve. I think that really done a good job. I think, as I said last year numerous times, our team in Asia Pacific, having gone through a period of tremendous growth, really embraced the notion that we are a manufacturing company first, and we are going to make cans for profit. We're just not going to make cans for growth. Cost reduction efforts, appropriate downsizing where needed, customer pruning where required to get proper returns on the capital that we deploy. Again, I think they've just done a tremendous job. Thanks for that. Just as a quick follow-up, I wholeheartedly understand that you don't necessarily want to get ahead of yourself, just given the macro and the ever-evolving situations. When we think about buybacks and the cadence for the balance of the year and your cash conversion, perhaps could you just give us a little insight on your thought process in terms of how you're evaluating that for the balance of 2025? Thank you. You're welcome. As Kevin said, we've $200 million accomplished early in Q1, and you probably should consider roughly another $100 million for the balance of the year. I think we want to be mindful of the environment we're in. I think we have a long-term leverage target of 2.5. We're not really that far away from that. I'm not overly concerned. I think we have some investors, or we have other investors who are not invested in us that would like to see us at that level or lower than that level. You want to make the company as attractive to as many investors as possible to drive value. We have a significant amount of debt that we do need to refinance over the next year or two. We're mindful of all these things. I think we're fortunate that we have improving operations. We have high demand for our products. We have an improving balance sheet, and we have a lot of cash flow that we can address all of these simultaneously. It's helpful, color. Thank you very much. Thank you. Thank you. Our next question is from Anthony Pettinari of Citig roup. Your line is now open. Good morning. Good morning. Tim, you referenced a tight supply situation for the summer in Europe and Americas bev. I am wondering if there are things you are doing in your system to debottleneck extra cans. More broadly, as you see accelerated substrate shift and maybe think about 2026 and beyond, are there regions where capacity additions may ultimately be required to meet your customers' needs? Can you just talk generally about how much runway you have before you maybe start to bump into? Yeah. Yeah. Listen, I did not mean to chuckle when you asked the question, debottlenecking. We are always trying to become more efficient and debottleneck. The problem you have when we get into the season, there is no time to get creative and thoughtful about how you are going to do this. You are just running cans. We obviously understand where those bottlenecks are. We will get to it when the season slows down. When you are in the season, you are just making cans, and you are trying to be thoughtful about how you fill orders and put the orders in the right locations with the right run lengths, etc., to generate as many cans as possible. It is really hard to do in season. The second part of your question, yeah, given the ongoing substrate shift that we believe is happening in Europe, there may be more capacity required. We are adding some capacity in Greece right now, and we'll continue to evaluate the other markets around continental Europe and the Middle East as we go forward. Okay. That's helpful. You talked about relatively minimal impact from tariffs to your bev can business. I'm wondering if you could talk a little bit about your Mexican business, to what extent they're seeing any impact or maybe percentage of your volumes that are going to the domestic Mexican market. Conversely, in Canada, you have, I think, an exposure to Canadian beer. We read about consumers there kind of favoring domestic brands increasingly. Just wondering if you could talk about Mexico and Canada in the context of tariffs and if it kind of moves the needle. No, absolutely. Thank you for the question. Our Mexican beverage can business, almost exclusively, the cans we sell are filled and distributed in Mexico. Very few cans that our customers fill in Mexico get exported to the U.S. We do not have that direct impact from tariffs. Again, we do not see much of a direct impact on tariffs to our Mexican business. What we do worry about in a geography like Mexico would be the indirect impact. That is consumer demand. I think that in any market where disposable income is less, and there could be a variety of products that become more expensive, especially if Mexico institutes retaliatory tariffs against the U.S. for those products that have to come into the U.S. from the U.S. into Mexico, and it makes it more expensive for Mexican citizens, then you do worry how much of their remaining disposable income will be used to purchase soft drinks and/or beer. For us in Mexico, indirect is almost nothing that our customers fill come to the U.S. Canada, I think, as you rightly point out, we have two very well-run facilities, one in Toronto, one in Calgary, supplying soft drinks and beer to the extent that Canadians want to consume more Canadian beer as opposed to U.S. imports. That will benefit us. If there's large tariff impacts for Canadian beer that's exported into the U.S., I don't see that as a large impact to our Canadian business. Okay. That's very helpful. I'll turn it over. Thank you. Thank you. Our next question is from Arun Viswanathan of RBC Capital Markets. Your line is now open. Hey, guys. Sorry about that. Congrats on a very strong quarter. Definitely nice to see that. I guess a few questions here. First, on the guidance, going back to your commentary, if you said that tariffs in total were about $30 million for the year, maybe tax-affect that, and you get about $0.15-$0.20. Is that the right way to think about it? The related question I had there was that you did provide some Q2 guidance as well. If we put that in and assume the midpoint of the full year, we're only getting to about $3.40 for the back half versus $3.70-$3.80 current consensus. There is obviously a big shortfall. I appreciate the uncertainty in the environment right now, but it does imply kind of a pretty large drop-off, especially for Q4. Maybe you can just help square some of those thoughts out if you can. Thanks. Yeah. I think that the roughly $30 million or less than $30 million we described was specifically related to transit. There always is, in answering Anthony's question, there always is a little bit of concern in a market like Mexico or perhaps Southeast Asia that the indirect impact of tariffs and/or inflation—we do not really see recessions impacting our business, but certainly inflation impacts our business. To the extent that global trade tensions create inflationary environments in a market like Mexico or Southeast Asia, you could be concerned with demand. It is a forecast. What I would say, Arun, if you want to look at it differently, if you take the midpoint of our second quarter guidance, and if we hit the third quarter and fourth quarter of last year, then we would be at the high end of the range that Kevin gave you. There is a variety of ways to look at the guidance we have given you. I would hope that the investor and analyst community would understand that we are trying to be thoughtful, and we do not want you to think with such skepticism that we have our head in the sand and we have not considered the environment that we live in right now. Okay. I appreciate that. I guess similar question on free cash flow. Obviously, very strong performance. You noted Q1 also stronger than normal, I imagine. Normal seasonality even, with positives. Do you see upside to free cash flow as you move through the year? What are some headwinds that would prevent that? Similarly, as you move into next year, it sounds like substrate shift should continue. Does that portend continued free cash flow growth as well? Should free cash flow kind of grow in line with EBITDA? Thanks. Yeah. I do not want to talk about next year. Let's get ahead of ourselves. I would say it this way. I would say as we sit here today, we do not see any downside to that cash flow number we have given you. It is early in the year, and I know you are looking at the numbers, and if your results in Q1 were $40 million or $50 million better than you thought they were going to be, how does that now flow to cash flow? It is a fair question. We will not be below the $800 million, I do not think. Okay. Great. Just lastly, any footprint you'd consider? You said tight stuff in North America, tight supply and demand for North American bev can. Does there need to be any actions taken there? I know there's been a lot of actions back and forth, additions and reductions over the last couple of years. Maybe it's best to leave it alone. What are your thoughts on supply demand, especially in some of these tighter markets? Yeah. I'll be careful how I say this. Listen, I think the can industry enjoyed an environment over the last several years in which the balance between global consumer companies that buy from us and the can companies, if it was way out of balance before, not in our favor, we gained a little favor back. It is still not a 50/50 relationship. The hope is that we are all mindful of supply-demand dynamics, and we are all mindful that our responsibility is to provide the best returns to our stakeholders. My hope would be that before we embark on another rapid capacity expansion program, we all keep that in mind as we go through the next several cycles of contract renegotiations. That is not meant to tell anybody anything. That is just meant to tell you how we view capital deployment as being responsible to you, our stakeholders. Great. Thanks a lot. Thank you. Our next question is from Mike Leithead of Barclays. Sir, your line is now open. Great. Thanks. Good morning, guys. Just one for me. Morning. 11% Brazil growth this quarter, obviously quite strong. Can you help us understand what drove that number? Was it business mix, category mix, just how you triangulated that performance this quarter and how you think you performed relative to the market there? Yeah. Sure. I think the market probably 3% or 4%. I would characterize for you our growth in the first quarter largely related to customer mix. If you know anything about the Brazilian market, there are four or five large customers. There's a variety of small customers. But those large customers make up the large majority of the Brazilian can market. And we're aligned with a customer that did quite well and promoted product quite heavily through the Carnival season. In Q1, I think that we do not, and you should not expect that we're going to be up 11% each quarter in 2025 in Brazil, but we should be ahead of the market, which I assume the market for the full year in the 2%-3% range. Now, having said that, we're going into their winter season. As we get to September and we start to see orders for the summer pack and the following Carnival season in 2026, we'll have a little bit more clarity. As we've always told you, we have been and we remain very bullish on the future of the can market in Brazil. Great. Thanks, Tim. Thank you. Our next question is from Josh Spector of UBS. Your line is now open. Hi. It's Anojja Shah sending in for Josh. Good morning. Good morning. I may have missed this, but did you actually give the volume growth number in Q1 for Europe? I bet you I did not. Mr. Fischer's looking at me right now. He's holding up five fingers. I think 5%. Thank you. A large European beer brand last week announced that it's exploring adoption of reusable packaging in their mix. Are you seeing more of this in Europe now as people prepare to address EPR requirements? If so, can cans sort of be technically categorized as reusable since they're infinitely recyclable to satisfy EPR requirements? That's a good question. Listen, I think what we always endeavor to do is increase collection rates and the recycled content. There are a wide variety of initiatives that various countries in Europe and the European Union have put forward with respect to the sustainability of packaging products, including cans, including whether or not they want refillable containers, reusable containers, recycled content of containers. We are working exceptionally hard to try to get to 90% across the board in Europe. There comes a time, I think we get to 90%, we can characterize our products as reusable, refillable. As you might imagine, the can is not a refillable container, right? We need to collect and recycle as many units as possible. Great. Thank you. Just a question on the North America market. I know you said your volumes were up 2%, but any sense of how the market was in Q1? If you have it, the split between alcoholic and non-alcoholic? Yeah. We do not get all the information anymore. Not all of the can companies report data to our—and not all the can companies are members of the association we belong to. I am guessing we were up 2% in North America. I bet you the market could have been up 3%. It just feels like the market was a little stronger than we initially thought it was going to be. I tell you, 3%. I do think that if mass beer was down, I think it is being replaced with cans being used for other alcoholic products. I think soft drinks perhaps up a little bit more than soft drinks and energy. I am giving you this off the top of my head because we do not get all data again. I think soft drinks and energy up more than alcohol as the other flavored alcohol drinks offset the decline in mass beer. Great. Thank you. That's very helpful. I'll turn it over. Thank you. Thank you. Our next question is from Jeff Zekauskas of JPMorgan Chase. Your line is now open. Thanks very much. If you were one of your customers, would you build inventories in the United States given the raw material patterns? On the beverage can side, absolutely not. They've managed to optimize their supply chain to where we deliver just in time, and they fill and they deliver just in time to the retail. I don't know why they would—I don't know why they would build unless they have already designs on mass promotions, which can only be done at lower prices. I don't see why they would do that. I think cans are available. Listen, the supply chain may get tight, but generally what that means when supply gets tight is that customers that are under contract get cans. Customers that are not under contract, they struggle to get cans. I don't think you'll see that in beverage. On the food side, they might take some cans in early, but they typically take cans early all year anyway because that's how we have to make them because they fill so much more during the pack season than is able to be produced during the pack season. Your margins were very strong in the first quarter. Were they unrepresentatively high? That is, were there positive price raw material variances that might have been temporary? Or is this something which could be a steady state for the year? I'll take the North American Food business to start, and I'll come back to beverage. In North American Food last year, we had metal repricing headwinds probably of $8 million-$10 million that we did not face this year. It was basically benign. It was zero. The pricing environment was flat. Year on year, that's a tailwind just because of the cost we had last year that we didn't experience this year. You would argue that if you're in a flat environment going forward, all things being equal, that we don't have a plus or a minus going forward next year from that. On the beverage can side, listen, I think we passed through a lot unrepresentatively high. I hope the answer to that is no, but you're always concerned that especially you sometimes become concerned if your margins are higher than others, do they have incentive to try to get to your margin level, or do they have incentive to try to drag you down? I will say that the margins expanded in Q1, and they expanded in an environment where the aluminum was higher. We're passing through higher aluminum, and at the same time, we generated higher margins. You typically see higher margins when we're passing through lower aluminum costs. Listen, the plants are running full. We've run a lot of inventory because we expect a strong summer selling season. Utilization is high. Profit in inventory is quite high, and we're running well. I hate to say it's too high because I could have told you it was too high last year. In just the Americas Beverage business, we are almost 250 basis points higher than we were in Q1 last year. Q1 last year, I will bet you it was 100 to 200 basis points higher than it was in 2023. Jeff, it is a good question. It is just one of those questions you hate to answer because you never know how high you can go if you do not keep pushing, and we are pushing. Great. Thanks so much. Thank you. Our next question is from Edlain Rodriguez of Mizuho. Your line is now open. Thank you. Good morning, everyone. I mean, Tim, the other segment, of course, driven by food cans, has rebounded very strongly. How should we think of that of income in that segment going forward? Should we think of that $25 million-$30 million as a good run rate for the rest of the year? I think if I wanted to give you a number, Edlain, I'd tell you to think about $100 million for this year. Why don't we do that? I think we expect to see some growth in Q2 versus Q2 last year, and we'll see how the balance of the year plays out. So much of that business is tied to the food can pack in the third quarter that it's sometimes hard to tell you how Q3 is going to go until we know how well the crops come in. The business is a little bit less cyclical or seasonal, I should say seasonal, than it used to be, only because pet foods are more stable than seasonal, and pet foods are an increasingly bigger part of that business. Think about $100 million for the year. Okay. Makes sense. One last one. I think in the prior answer, you kind of said if you look at the second half versus last year, if you do the same, you'll be at the high end of your guide. What would have to happen for you to be below last year's second half? I mean, can you see anything out there that could prevent you from exceeding or at least meet the second half of last year? There are a lot of things that can happen, right? I mean, you want to ask a CEO what can go wrong? I spend my whole life worrying about what can go wrong. I do not mean to say it that way, but if you do not run a business that way, then you are taking your eye off the ball. Listen, I think that let's talk about what could go wrong and why we think the range we have given you is achievable and the opportunity for the high end of the range is also achievable. We talked about earlier that indirect tariff exposure on the beverage can side, in our view, largely only exposed in markets like Southeast Asia and/or Mexico where the economies are a little bit more fragile, disposable income not as great as it is in North America and Europe for consumers. Now, we'll see how that goes, but you're not talking about huge numbers here, right? People are still going to consume. If the summer selling season does not turn out to be as robust as I've indicated our confidence to be in North America and Europe, it could drag you down a few cents. Boy, it really feels like both regions are going to be strong just as we sit here today at the end of April. Lastly, we've tried to be very mindful, and I don't know if we've been overly cautious or not as cautious as we should have been with respect to direct and indirect tariffs in our transit business, but we put a number out there, and it could be too high of a number or it could be too little of a number, but we'll see how the rest of the year goes. We think we've given you a range. We do think the higher end of the range is achievable, but we're going to see how the balance of the year plays out. We're going to see how tariffs play out, and we're going to see how consumer demand plays out into our strong selling season. Let's not forget, we have a lot of cans we and the rest of the members of the industry need to sell over the next five months. No. Makes sense. Good color. Thank you. Okay. Al, are we going to take one more? We'll take one more question, please? Sure. Our next question is from Gabe Hajde of Wells Fargo Securities. Your line is now open. Tim, Kevin, good morning. Good morning, Gabe. Good morning, Gabe. I'm going to try to ask for a third time, maybe specifically sort of what you know and feel like you have under your belt, appreciating, like you said, second half, a lot can happen. The sequential EPS increase of $0.13-$0.23 in Q2, I think in Q1, in 2023, it was $0.48. In 2024, it was $0.79. Seems pretty small, the leap. To the extent you're willing to, the bridge on Americas EBIT improvement, volume, maybe productivity improvements, anything like that that we should be mindful of as we think about the second quarter? I think I'm probably not prepared to do that because there's too many people listening. Gabe, what I'd tell you, it all comes down to volume as we get through the summer, right? We're not only looking to sell cans. We're looking to rebuild the inventory and keep utilization rates real high. The easiest way to rebuild inventory is if your customers take cans. Your sales are high, and you have to rebuild the inventory for the next quarter. It all comes down to customer pull. Okay. I have two last ones. I'll try to squeeze them in quick. When there's consolidation with your customers, can you talk about how long it may take to bring that new customer onto maybe your contracts and things like that? Do you typically get the benefit of those incremental cans in the acquisition year, or does it take a little bit to flow through? On the cash flow side, is there a specific working capital assumption built in there, Kevin? Are plants more expensive to build or lines more expensive to add versus even two, three years ago? Q1 CapEx, $33 million, I'm assuming timing, but anything in there that we should be mindful of? A lot of questions there. Let's try to remember them all. Capital, I think that largely timing, Gabe. We're running flat out. It's hard to tell the plants to dedicate resources to another area, the factory, for needs, for new capital. We're running flat out right now in the big markets, but largely timing. I think we'll start to spend more money as we go through the year. Kevin, you want to take the working capital, and then Gabe will remind me of the first question because I forgot to. Sure. Gabe. Yeah. Working capital is going to run somewhere, call it $75 million outflow this year. Yeah. And part of that question was, are plants more expensive to build? Absolutely, Gabe. I mean, I'll just give you numbers. What we might have envisioned, the all-in cost of a new two-line can plant building and equipment, if it used to be $170 million, it might be over $250 million now or more. Yes, much more expensive. Construction, steel, labor, all kinds of things, permitting, all kinds of things. You had a first question that I forgot. I apologize. Please ask again. Consolidation with your customers. Do you typically see the impact of that? Yeah. Yeah. I think, Gabe, you asked a question, and the answer is all the above. It really depends on what commitments the acquired or the target business has had with its suppliers. It may depend on the contracts that the acquiring company has with its suppliers. I'd say all of the above. If we're already supplying the target, then we have the artwork. If we're not supplying the target, it does not take very long to get the artwork and then get qualified at that new customer. The answer is all the above. Thank you. Thank you, Gabe. Thank you. I think that was the last question. Thank you very much. That will conclude the call. We thank all of you for joining us, and we look forward to speaking with you again in July. Bye now. That concludes today's conference. Thank you, everyone, for joining. You may disconnect and have a great day.