Great to see everybody. Most importantly, great to see O-I Glass here, or as some of us say, Owens-Illinois, if you guys can still deal with that. Yeah. We'll go either way. Here from the company are Chris Manuel, who we know from investor relations in the front, if you have any questions, as well as John Haudrich, Senior Vice President, Chief Financial Officer of the company. John, as we know, is focused on O-I's strategy, execution, performance management, and financial decision-making. He has leadership responsibilities maintaining financial flexibility for the company and a number of other initiatives. John joined O-I in 2009. Without further ado, I give you John Haudrich and O-I Glass. John, take it away. Thank you, George, and the Bank of America team for hosting us today. This morning, I plan to discuss how O-I represents an attractive investment opportunity. Afterward, we'd be happy to take your questions. Before we proceed, please review the safe harbor comments on slide two and various disclosures found in the presentation, which are posted on our website. On slide three, you'll see a high-level profile of the company. O-I is the global leader in glass packaging. We serve the highly stable and steadily growing food and beverage industry, supporting more than 6,000 customers. These customers value our dedication to service and our unparalleled production network to meet their needs across the globe, recognized by a continuously improving Net Promoter Score. As the industry leader in innovation, we are proud to make glass the most sustainable packaging solution. Likewise, it is the preferred substrate by most consumers given its premium characteristics and their increased focus on health and wellness. Last year, O-I passed an inflection point in its long corporate history. In July, Paddock emerged from bankruptcy after achieving a fair and final resolution of its legacy asbestos-related liabilities. As such, we expect to generate substantially more cash flow each year that can be deployed to expand our business, reduce debt, and create value for our shareholders. At the same time, we are developing MAGMA, a revolutionary new glass production process that will augment profitable growth and boost our financial performance. Let me expand on this strategy starting on page four. I strongly believe O-I represents an attractive investment opportunity. Over the past few years, we have developed a very good track record on performance. In fact, we have either met or exceeded consensus for twelve consecutive quarters. At the same time, we have reduced risk by resolving legacy liabilities and improving our balance sheet. This improved performance is supported by agile execution enabled by strong capabilities we have built over the last few years and the bold actions we are taking to transform O-I. Likewise, we are capitalizing on the strongest glass fundamentals in decades to drive profitable growth. Importantly, MAGMA represents a breakthrough innovation that creates a new paradigm for glass to meet the needs of an evolving market and expand our business. Finally, as the most sustainable packaging option, glass is set to win in the new green economy. Let's expand on each aspect of the strategy a bit more. Moving to page five. We have delivered consistent earnings and balance sheet improvement over the past several years. As you can see on the left, adjusted earnings per share have increased nicely since 2020. We expect further improvement in 2023, supported by good net price and continued incremental impact of our margin expansion initiatives. Looking forward to 2024 and beyond, our ongoing capacity expansion and margin expansion initiatives should enable additional earnings momentum. As shown on the right, we have significantly reduced our financial leverage over the past few years in addition to resolving Paddock's legacy asbestos liability last year. We expect continued progress and anticipate leverage should drop below 3x by the end of 2023, with a longer-term target of 2.5x over the next few years. Our balance sheet is in the best position in over a decade. I'm now on slide six. We have also been hard at work transforming the company. The team started by building a simple, agile, and effective organization. We are optimizing our structure. As discussed, Paddock resolved its liabilities, and we completed our $1.5 billion portfolio optimization program well ahead of schedule. We are more cost competitive as a result of our margin expansion initiatives, which have generated around $320 million in net benefits over the last few years. As a result of these efforts, O-I has been able to overcome elevated market volatility, reduce debt as we increased our adjusted free cash flow conversion to over 35% last year. We are squarely focused on advancing MAGMA, which will enable a more flexible, scalable, and sustainable production capacity as well as increased supply chain efficiency. All this will support profitable growth, which I'll discuss more on page seven. We believe glass has a bright future. As illustrated on the left, our sales volume, including JVs, has increased about 1.5% a year on average over this period, resulting in the strongest glass fundamentals in 20 years. This is being driven by a number of factors, including increased consumer preference for premium and healthier products and packaging, structural market shifts, and oversold conditions amid strong demand in several key markets. As a result, glass demand is now expected to grow 2%-4% a year in the key markets that we serve over the next three years. We continue to advance our capital expansion program to capitalize on these trends. In total, we are adding new capacity to support 5%-6% profitable growth through 2024, with an average return of around 20%. In addition to these programs, we have a solid commercial pipeline in excess of 1.6 million tn, representing future opportunity for additional growth. On slide eight, you see the benefits of MAGMA, which is O-I's new proprietary glass production system leveraging new breakthrough technology. Our Heritage network is a great fit for many of the categories that we have served for decades and will continue to serve in the future. Given the trends in health, wellness, and sustainability, there are significant future opportunities in a broad array of in-use categories, which tend to be more differentiated and fragmented. MAGMA is a perfect fit to expand in these categories. MAGMA is more flexible, scalable, and can be more rapidly deployed. It can be co-located to improve supply chain efficiency. It is more cost-effective with lower capital intensity. Likewise, MAGMA can be used with ULTRA to allow significant container lightweighting. MAGMA will enable future use of carbon-free energy sources like hydrogen and biofuels, it increases convenience and sustainability. MAGMA represents a major leap forward in how glass is produced and will expand O-I's right to win in its addressable markets. Overall, we are targeting returns in excess of 20% for future MAGMA expansion projects. Moving to page nine. We are very excited about our first MAGMA greenfield plant in Bowling Green, Kentucky, which is on track for initial commercialization in mid-2024. We are designing the plant to be a showcase facility that will demonstrate all of our next-generation capabilities. The new state-of-the-art facility will include the MAGMA melter, new modular batch system, and pilot forming machine. It will be fully digitized with a high-performance operating model. This highly scalable plant will eventually include all MAGMA Gen 1, Gen 2, and Gen 3 solutions with the next-generation sustainability features as well as our ultra-lightweighting system. Located on the Bourbon Trail, the Bowling Green plant will demonstrate the value of near location and will be a key hub for future customer collaboration, investor visits, and demonstration of O-I's next-generation capabilities. I invite you to view a recent video that we created that shows MAGMA in action and further discusses its many important attributes. The slide includes a link to the video. Sustainability is another critical element of our strategy as glass is set to win in the new green economy. I encourage all of you to take a look at our updated sustainability report, which can be found on the company's website. We added a few highlights on page 10 with more details in the appendix. We are already more than halfway to our 2030 emissions reduction target. We are implementing new technologies to further reduce CO2. Renewable energy now represents more than 27% of our energy source, and we are well on our way to our 2030 target. We are expanding recycling collection sites and funding numerous projects to expand cullet usage. As noted, MAGMA and ULTRA will also provide significant sustainability benefits in the future. We're making solid progress, which has been recognized by a number of organizations, as noted at the bottom of the slide. Glass is already the most sustainable packaging solution. I believe you'll be hard pressed to find many industrial companies with so many levers to further improve their sustainability position. O-I has established another set of ambitious and achievable objectives in 2023 to advance our strategy. This is summarized on page 11. Higher earnings and margins should benefit from strong net price realization and our ongoing margin expansion initiatives. As you can see, we have increased our annual initiative target to more than $100 million, which now includes a set of focused initiatives to advance performance across targeted operations, primarily in North America. We have already discussed a number of other focused areas this year, including expansion initiatives, technology development, ESG, and capital structure improvement. I am highly confident these efforts, taken in concert, will advance our strategy as we continue to transform O-I. Let me touch base on our business outlook, I'm now on page 12, which recaps our most recent guidance provided during our year-end earnings call. As noted earlier, earnings have consistently improved over the last few years, and we have either met or exceeded expectations for 12 consecutive quarters. We expect this momentum will continue and anticipate continued progress in 2023. Importantly, we now expect first quarter adjusted EPS will exceed guidance as performance has been stronger than originally anticipated. While sales volume will likely be down mid-single digits amid a very challenging prior year comparison, our improved outlook reflects strong net price realization as well as solid operating and cost performance. Of course, we all face elevated market uncertainty and volatility as well as a potential recession. Keep in mind, we have factored some level of macro risk in our full year outlook, especially in the back half of the year. Despite this, we have a constructive outlook on 2023 and expect to reinstate a full year adjusted EPS guidance range during our next earnings call. Let me cover our capital allocation priorities. I'm now on page 13. Improving our capital structure remains our top capital allocation priority. As noted, we expect leverage will end the year below 3x. We will continue to reduce debt consistent with our glide path to 2.5x leverage and expect to eliminate our net unfunded pension liability over the next few years. Our second priority is to fund profitable growth. This includes our current $630 million expansion program. We do anticipate continued modest portfolio optimization as we seek to increase ROIC, which could also help debt reduction or expansion. Returning value to shareholders is our final priority. We will continue our anti-dilutive share repurchase program. Likewise, we may evaluate additional share repurchases or reinstate a dividend as we get closer to our capital structure objectives. Let's turn to page 14 for some concluding remarks. First, the company is performing well, and we have a constructive view on 2023. O-I has a clear strategy to create value and redeploy capital effectively. As shared, we have consistently taken the bold actions to advance our transformation. Likewise, O-I is a much more agile and resilient company as we continue to successfully navigate elevated market uncertainty. Finally, I believe O-I represents an attractive investment opportunity as we reduce our risk profile, execute our transformation program, enable profitable growth, advance breakthrough innovation like MAGMA, and further leverage our sustainability position to win in the new green economy. We are confident this strategy will create value for all stakeholders. Thank you for your interest in O-I Glass. George, back to you for questions. Thank you, John. Thanks for the rundown. I guess first question I had, you know, you are now guiding to above your prior guidance range. You said net price is going well. You said operations have also done well despite the mid-single digit volume decline, which is not a surprise, you've already guided to that. Sure. To the extent that you can comment, what have been the one or two things that would be a common denominator on the price realization that's gone better, and certainly on operations, what's gone well beyond what you're expecting, other than maybe you were just trying to factor in some conservatism given how uncertain the environment has been? As we entered the first quarter in earnings call when we provided guidance, in particular on the first quarter, we were about two-thirds of the way through our annual price negotiation process. Now we're substantially complete, and then we have a fuller realization of where we are. You know, that has ended up incrementally better than we originally anticipated. Got it. I would also say our margin expansion initiatives have gone better than expected in the first quarter. That might be ultimately be a timing element to be able to get in front of these upsides. As I had mentioned in my prepared remarks, we're really focusing on our North American operations. We see good upside, we see an inflection point there, and we made good progress on some of the fundamental contract restructurings and things like that going on in those marketplace. Those all set some to positives for the quarter. The contracts I would assume would be more in the realizations in North America. Would that be fair? I'm sorry. The contract discussions, that's part of the realization benefit, the net pricing benefit you're seeing in North America. Right. On operations, maybe there is no one common denominator, but what's gone a little bit better than expected. Yeah. To give you the launchpad? Yeah, it's really comes down to production efficiencies. You know, we measure our business in Pack to Melt and these types of measures. That has just exceeded our original expectations. It's one of the best performance periods that we can see. At the same token, we've had some external disruptions, strikes in France, the civil unrest in Peru, and we had some impact of flooding in Northern California when the Bay Area had a lot of flooding. Despite that, you know, the operating performance is very well. You know, back to the net price component, keep in mind, there's a number of elements that are driving the increase in net price. First, it is the annualization of the prices that we did last year. Yeah. We have the price adjustment formulas that kick in, you know, contractually on 55% of our global business that is contracted. That comes through, and that's picking up the inflation from last year. The third piece is, in fact, what we were just talking about, North America and good progress on restructuring those contracts. The final is this incremental price increase that we put at the beginning of the year. If you take a look at all of those, there's a lot of sustainable aspects of those as we pick up historic, you know, recovery of inflation in the past. Keep in mind, you know, the inflation this year is still 8%-9% out there. I mean, it's probably hit its peak back in the fourth quarter or so, but we're still looking at elevated cost inflation. It, there is a good backstop for the net price realization. John, the 55%, again, that is the number of customers or amount of revenue that's tied up in a. Long-term agreements. Okay. Those long-term agreements all have these price adjustment formulas that on a, on an arrears basis, sometimes it's annual, sometimes it's quarter, semi-annually, that recover the cost inflation from the prior year. We have actually made some progress on switching annual price adjustment formulas to maybe semi-annual or quarterly, which will help the business in the long run. Recognizing there's a lot of inflation in the market, and that is one of the reasons that you should be recovering. Yeah. Are you getting any more pushback than maybe last year from your customers? You know, we're starting to see some headlines, you know, retailers saying, you know, "Hey, supply chain, you know, enough's enough on pricing." Glass as a percentage of the overall cost to a big retailer is not a lot. Yeah. Nonetheless, is any of that water starting to roll downhill from what you're seeing, even though you're getting the pricing now? I don't think there's any practical impact of that right now. You know, of course, nobody likes pricing. You know, we don't like it from our suppliers either. You know, it's part of the reality. If you look at energy in Europe, for example, last year, it peaked at about EUR 120 per MWh. Obviously, it's down from that, but it's still 3x higher than it was on pre-pandemic basis. You have cost inflation now flushing through raw materials. You have cost inflation flushing through the labor side. You got higher interest expense. You got inflation on capital goods. Yeah. There's a lot of things. A company in this world right now has to manage its cash flows more than any, particularly these levers. When you take a look at that in total, I think it's an environment where the price increases are very justified based upon the environment that we're looking at. Sure. You know, one question we've been asking all the companies that are here, and to some degree, you gave the answer in your, in your presentation, but, you know, O-I's been performing well. Mm-hmm. It's one of a number of companies that investors that are here or listening on the web could invest in packaging and paper and forest. On top of that, our sector is less than 0.3% of the S&P 500. Mm-hmm. To break through this group of stocks, the sector, let alone the broader market, you know, what's the one or two things you want a PM or an analyst who's listening in to take away about why they should buy O-I right now? I think it's a good question. I think I'll go back to even one of the headlines in one of your notes. This is not your grandfather's O-I. We have been transforming this company, and we made meaningful changes. We have the operating performance and execution's much better, much more stable. The confidence is there. We've unconstrained the company in many ways. We've taken care of asbestos, improved the balance sheet. Now we're really focusing on profitable growth with new breakthrough technology over the longer term. Mm-hmm. At the same token, George, our valuation relative to others in the space is pretty, pretty low. It hasn't been fully recognized. I think with the bias on the upside, the tension on the upside of what we have to perform, a company in transformation and proving it's successful in its transformation with upside there... Yeah. I think those are good reasons people should take a look at O-I. Thanks for that, John. On the operational front and the continued margin improvement initiatives that you've got, was that $50 million annually, and this year it's gonna be at $100 million? Correct. When should we start expecting some deceleration in that? I mean, you can't, or can you, keep doing $50 million a year- Yeah. -from operational improvements? Yeah, I think we can. Companies that execute well should target at least 2% cost takeout per year, at least on the growth basis. Of course, you know, the real world gets in the way sometimes. Sure. -and things get diluted, of course. You know, that's the type of productivity improvement a company should try to target. Net of your inflation. Yeah. This is... Yeah, exactly. Okay. This is just productivity improvement in the business, and inflation needs to be taken care of through price and things like that. Okay. Got it, got it, got it. bucking that off in there. Keep in mind also our margin expansion initiatives is not just plant productivity. It's also revenue optimization. There's a lot of things. You go back to that North America story, you know, contract improvement, a lot of terms and conditions. Sure. There's a lot of money that gets wrapped up in there. Even how you manage pallets and tier sheets and all those types of things and get recovery really add up on the position that we're in. Not to mention the OpEx side, we've done a lot. you know, I think we've reduced our SG&A head count about more than 25% over the last five years, and we continue to optimize, and there's digitization and automation, and we're outsourcing things with a partner on managed services. There's a lot going on that can continue this good trend. I would also say each year that we've comfortably exceeded our target, we're confident going forward. Let's talk about MAGMA for a little bit. Tell me a little bit about in Bowling Green, to the extent that you can. Uh-huh. -because it's new technology, what's different about the melter here, and what's unique? What makes the batch process, or the furnace process batch in? Yeah. Yeah. Keep in mind that a typical furnace, historic legacy furnace is about the size of a kid's gymnasium, maybe fit in the room that we're in right now. You know, MAGMA is 1/10 of the size, as you get an idea. It has an on/off switch. You know, it has increased flexibility. It's portable. It can be prefabricated. It can be done at a lot lower capital intensity. It's not a big capital structure. Yeah. Ultimately, what we wanna do is move from a big smokestack factory structure ultimately to an industrial warehouse structure that you can actually put on-site or co-locate with your customer. It's a meaningfully different, you know, overall structure, and that's what we wanna be able to show over in Bowling Green. In order to do that, what we have to do is reduce the size of all of the equipment and activity within the system. If you go to a typical glass factory and you see the batch systems, they're some of the highest structures within the facility. Yeah. We needed to bring that, you know, miniaturize that batch system down into something that also can fit with an industrial warehouse. It's all part of the miniaturization process that we put in. Historically, why did the batches have to be so large? Was it the way you had to heat them? Yeah. Well, it's the batch is the front end. That's where you're mixing the raw materials... Yeah. -in-and including on that. It's a gravity-based system kinda going down, and so it's structured that way. Yeah. It's still a large structure. If you take a look at the picture, you see where it's a little bit nudged up there on the left. That's the batch system inside of it. It's still significantly lower than what we historically have. It's an engineering feat. When we go back to the Analyst Day from September of 2021, I think at one point in time, you talked about, you know, four or five perhaps factories. Mm-hmm. -being MAGMA factories, maybe a bit more than that. I rephrase. Let me recant. You had about 11 lines. Correct. that you were talking about. That's right. Yes. Now we're down to a couple, three. Right. -factories. Is there any difference in terms of the breadth with which you're deploying MAGMA? Because based on what you just said, I would think you'd want to deploy it everywhere- Mm-hmm. as opposed to Yeah. at a lesser degree. Is it a lesser degree, or no, it's just- It's. counting lines versus plants? It's a fewer number, but more advanced technology. Okay. Okay? 'Cause originally, what we were going to do is run out those 11 lines, but they were gonna be early Generation 1 technology in 11 different lines in different markets. Supply chain issues happened, and you know, our development cycle kinda got impacted, call it 6-12 months. We did have, you know, firm customer contracts that we had to honor. Otherwise, there's penalties associated with that. We, we found some, you know, actually great projects internally that we could still leverage within, you know, existing technology. More importantly, what we were able to do then is really accelerate the MAGMA Generation 2 and Generation 3 development and deployment of those. Original plan was we were gonna run out 11 Gen 1 and then develop. Okay. Gen 2 and 3 for deployment after 2025. Witin this one year, you're gonna have Gen 2 and Gen 3 between now and 2025 actually operating. That is the system that we really wanna prove out in an operational setting so that we can then replicate. You really don't need, you know, 11 of them to fully understand the technology and its practical implication to be able to start the replication process. This actually advances our ability to commercialize MAGMA Gen 3, which is the one that has the most economic and customer value. Maybe a simplistic question. Does the fact that you've got two, recognizing it's more advanced- Mm-hmm. -versus the 11, 'cause again, the proposition on MAGMA has been It makes you less capital intensive. Mm-hmm. Yeah. Will this mean that O-I's maybe a bit more capital intensive in the intermediate period before you finally prove out MAGMA or no? No, not really. Really when we were going to do Generation 1, maybe it's 5% less capital intensity than a Heritage. Got it. Maybe a Generation 3 is more like up to 40% lower, right? On the margin, it's a little bit, but actually we found some really good internal projects on the margin that we can do that have really low capital intensity. I think we're parity. Okay. George, our original program was $680 million of capital for that original program. It's now $630 million. It's actually a little bit better. Thanks, John. Any questions from the audience for John Haudrich? Robbie, if you can just wait for Linda. Hi. I was just wondering if you could comment a little bit around market structure for glass, I guess it's within North America. I've always viewed it as a local business or a regional business. Does that change at all with this technology? I suppose also what does this mean for the existing, you know, base, a production base that you have and I guess that the industry has looking forward, please? Yeah, sure. Under Heritage technology that we have right now, you're right. You really wanna keep it within like a 250 mi-300 mi radius of the facility, right? Shipping costs do add up with bottles. The beauty of MAGMA is that you'd probably have a larger number of smaller facilities actually closer to the action, whether that is actually on your customer site or, for example, what we're doing here in Bowling Green, kind of near located on the Bourbon Trail, right? Where there's a lot of customers. Ultimately with MAGMA, Heritage is still gonna be a very important part of our base. We think ultimately down the road, MAGMA represents 50%-75% of our system. Heritage will still be out there. If you're running large beer runs and things like that, Heritage technology, it's still your best fit. As we try to get into the. We believe there's about 35% of the glass market that we have a hard time really addressing because we don't have the flexibility in the system to be able to get there, and that tends to be smaller customers, more fragmented business, which actually tends to be more higher margin business. That is a great fit for MAGMA going forward. I think we're gonna have the combination of both of those. I believe over time, incremental expansion will be substantially on the MAGMA side. As far as the Heritage base, you know, what we're, you know, we're having Generation 1, 2, and 3. As furnaces hit their end of life, which is, let's say every 10-15 years, we would look to substantially replace those with a MAGMA Gen 1 solution that provides a lot of the value, maybe not the full value that you get on an, on an integrated, I mean, on a full greenfield basis. We may look at some of our facilities, we just say, "You know, it's best just to close that facility and actually go all in on MAGMA for that book of business based upon where we're at." That's all in front of us. The important thing is, if you look at the capital intensity over the long run, a MAGMA unit doesn't have a real end of life. It's not like a furnace that has to be replaced every 10 or 15 years. You put it in once, and It's a machine and has to be repaired and things like that, but you get out of this very significant capital intensity over the full life cycle of the asset. It's really a win-win situation for the business. John, on that, and again, I'm probably missing something obvious, but when a furnace does come up for rebuild, you're gonna replace it with a Gen 1. Why not, if possible, with a Gen 2 or Gen 3? Or it's just trying to match... Yeah. a furnace with a customer mix that you've got and whether it's. If you take a look at a typical glass facility, the existing ones that we have right now, it's just the furnace that has an end of life, that has to be replaced every 10- 15 years. Everything else. Right. It has a long life to it and everything like that. We have to evaluate, is it better to go in and as that furnace replaces, pull it out and add maybe two MAGMA lines, and you get all the flexibility. In some cases, as I mentioned, we may say, "You know what? The mix of business and everything, let's just scrap the whole plant and let's go ahead and do MAGMA from... Got it. the ground up." That'll be a situation by situation analysis. Makes sense. Appreciate that. you know, maybe one last question before we wrap up here, I know you probably get it frequently. There is not a lot of industry data on glass. Yeah. We the best we have is the North American data. We get some scanner analyses. Mm-hmm. You're projecting and that data, especially the North American data, remains relatively depressed. Mm-hmm. perhaps we're missing the imports... Mm-hmm. you know. That's true for-. from Mexico and other places. why else you would be comfortable about the supply-demand outlook. Yeah. given that you're adding capacity? I think there's probably another million tons being added from our. Mm-hmm. over the next few years, and why this really good position that glass has been in. Right. Doesn't erode somehow with obviously, the optically declining volumes we're seeing in North America. First of all, on the later part first. If you take a look at on a global basis, all the capacity that we're aware of, including our capacity expansions that we're doing over the next few years, we still see a structurally short glass market. Okay. There's not as much going in as we think is that 2%-4% fundamental growth. If you take a look specifically back to the North American marketplace, it's really a tale of two markets. I mean, we know that there's been beer and that has been the one that's rebased over the years. Keep in mind, that's only 4% of our global basis that, you know, capacity is the mega beer. That's like 14% of our North American business anymore. It's a relatively smaller piece. You're right. Over the last six months or so, I think you saw a decline in beer. You look at the beer packaging index, you know, it was in the 40s, and 50 is the break-even point. Really this last month it popped back to 54. We'll have to see whether that was situational or whether it sustains itself. Underneath it is very good, you know, activity in the spirits and the wine and the food categories and things like that. You know, beer has been the one that's rebased. Again, it's not as big of an element. One thing I say is that we have been renegotiating, as I mentioned, a lot of our long-term agreements, right? That includes beer and all the different substrates. We're having very good success in how we're structuring them, which also to us is a signal that our customers really value glass as a substrate in their product lines. Okay. Got it. Great story. All right. Great performance. Thanks, John. Thanks. Appreciate it. Thanks, George. Everybody, please join me in thanking O-I Glass for a great presentation. Thanks. All right.