Hello everyone, and welcome to the O-I Glass Third Quarter 2023 Earnings Conference Call. My name is Nadia, and I'll be coordinating the call today. If you would like to ask a question, please press star followed by one on your telephone keypad. I will now hand over to your host, Chris Manuel, Vice President of Investor Relations, to begin. Chris, please go ahead. Thank you, Nadia, and welcome everyone to the O-I Glass third quarter conference call. Our discussion today will be led by Andres Lopez, our CEO, and by John Haudrich, our CFO. Today, we will discuss key business developments and review our financial results. Following prepared remarks, we will host a Q&A session. Presentation materials for this earnings call are available on the company's website. Please review the safe harbor comments and disclosure of our use of non-GAAP financial measures included in those materials. Now I'd like to turn the call over to Andres, who will start on slide three. Good morning, everyone, and thanks for your interest in O-I. We are pleased to announce strong third quarter results as the company continues to execute well in a challenging macro environment. O-I reported adjusted earnings of $0.80 per share, which exceeded our expectations and represented a 27% increase from the prior year. The company benefited from strong net price realization and solid operating performance amid softer than expected demand. As a result, the top line was up as we improved our segment operating profit, our margins, and our adjusted earnings. In addition to solid results, we continue to advance our strategy. Our margin expansion efforts are well ahead of target, and our first MAGMA greenfield plant in Bowling Green, Kentucky, remains on track for a mid-2024 ramp-up. Likewise, we achieved our full-year balance sheet objective ahead of plan. We expect strong 2023 results, with adjusted earnings up 30% from the prior year, which will represent the best performance in the past 15 years. We will share our view on recent market trends. Shipments have been softer than anticipated as demand has temporarily decoupled from consumer consumption due to significant inventory stocking across the value chain. While we are not immune to the broader macro dynamics, we are executing effectively and taking a number of actions to drive a strong performance as conditions recover. We will conclude with our initial thoughts on key business drivers for 2024. Now I'll turn it over to John, who will review our recent performance and 2023 outlook in greater detail, starting on slide four. Thanks, Andres, and good morning, everyone. Building off our earlier comments, O-I delivered strong third quarter results. The top line was up. We generated double-digit improvement across Adjusted EBITDA, segment operating profit, and adjusted earnings, while margins were up 160 basis points. Likewise, free cash flow increased nicely from the third quarter last year. And finally, our balance sheet position improved, with net debt leverage down to 2.8 x, which is now better than our full year target of 3 x. Overall, we posted significant year-over-year improvement across our key financial measures, despite difficult market conditions. In addition to strong results, we continue to advance our long-term strategy, and the appendix includes our current scorecard on key 2023 strategic objectives. Next, I'll expand on our strong third quarter performance, starting on slide 5. Both the top line and bottom line improved in the third quarter. Net sales increased and earnings improved 27% as strong net price realization and solid operating performance offset softer demand. Revenue increased to $1.74 billion as the combination of higher average selling prices and favorable FX more than offset softer sales volume. Third quarter adjusted earnings of $0.80 per share was up nicely from the prior year, mainly reflecting higher segment operating profit. Non-operating items were a modest benefit as lower corporate costs and tax rate more than offset elevated interest expense. The lower tax rate included the resolution of a tax matter in Europe that added about $0.04 versus our guidance. FX was a modest tailwind and consistent with our outlook. Let's turn to slide 6, where we discuss recent performance trends across our two business segments. Segment operating profit exceeded $300 million, which represented a 13% increase from last year as margins improved 160 basis points. Results were down in the Americas, while up significantly across Europe. In the Americas, segment operating profit was $116 million, compared to $130 million in the prior year. The benefit of higher net price and a slight FX advantage partially offset the impact of lower sales volume and higher operating costs. Shipments were down 15%, and we noted double-digit volume declines across nearly all markets and geographies, reflecting significant destocking activity, with more pronounced pressure in wine, spirits, as well as beer. Andres will discuss market trends further in a few minutes. Costs increased around $40 million due to temporary production curtailment to balance supply with lower demand, and we incurred additional expense due to elevated planned maintenance activity. Europe posted segment operating profit of $185 million, which was up 36% from last year. Strong net price and a slight FX tailwind more than offset the impact of lower sales volume and moderately higher operating costs. As with the Americas, shipments were down 15%, and we noted double-digit declines across nearly all markets and geographies, reflecting significant destocking activity. Likewise, we saw more pronounced pressure in wine and food. Higher costs reflected last year's $13 million dollar benefit from Italian energy credits, which did not repeat in 2023. Despite the challenging conditions, the company yet again significantly improved its segment performance. Let's discuss our updated full year 2023 business outlook. Please move to slide 7. We now expect Adjusted earnings will approximate $3 per share, which represents a 30% increase from last year. Free cash flow should range between $100 million and $150 million, and as noted, leverage should end the year below our annual target. We have revised our full year and fourth quarter outlook, primarily due to lower than expected sales and production levels. With our strong performance this year, we have decided to accelerate temporary production curtailment activity, given softer demand. As a result, we intend to curtail about 20% of our global capacity in the fourth quarter, which will impact earnings by approximately $0.30 per share, more than previously planned. At the same time, we have accelerated a number of margin expansion initiatives to partially mitigate lower sales and production volumes. Despite these adjustments, we expect a historically strong 2023 performance. Now I'll turn it back to Andres, who will share our view on recent market trends, review the actions we are taking to drive strong performance as volumes begin to recover, and discuss our initial view on 2024 business drivers. Please turn to page eight. Thanks, John. Let me start by sharing our view on recent market trends. We are facing a unique set of conditions that have led to a temporary decoupling of consumer consumption patterns and demand for glass containers. Overall, our shipments are down primarily due to a significant inventory destocking, amid modestly softer consumer consumption. While we have seen some temporary trade down in certain markets, especially in beer, we anticipate little share shift through the cycle. The chart on the right illustrates Nielsen retail consumer consumption trends for the categories that we serve, and O-I's glass shipments since mid-2022. We also include our current view of future patterns through 2024. As you can see, consumer consumption is down low- to mid-single digits across the categories that we serve, yet glass shipments has been measurably below this level. We have noted widespread destocking across the value chain as our customers, distributors, and retailers adjust their inventory management practices. We believe this change is adjusting for high initial inventories in the supply chain, as well as current sluggish consumption. Likewise, supply chains are recalibrating for more moderate future growth and higher interest rates, which push up the carrying cost of inventory. While October volume trends remain down, we are seeing some sequential improvement compared to trends in August and September. The rate of decline has started to reverse in segments like food and NAB in North America, and in certain segments in Southern Europe, including beer and NAB. Furthermore, the Andean market has already transitioned from decline to a strong growth, supported by our recent expansion initiatives. Again, we believe the current situation is temporary, and we expect demand will rebound as we go into 2024. In summary, we expect low-to-mid single-digit sales volume growth in 2024. Let's move to slide 9. O-I is a much more agile and capable organization than in the past. This reflects significant structural changes embedded in our transformation journey, which is illustrated in the top chart. As a result, we have executed well to overcome each challenge over the past several years, and have consistently improved our performance, as noted in the bottom chart. In fact, this quarter marks the 13th consecutive quarter we have either met or exceeded our expectations. We are again acting with agility to navigate the current market situation and taking four specific steps. First, we are curtailing capacity given softer demands to adjust inventory levels as we head into 2024. Second, we are accelerating planned network optimization actions across North America. For the past year or so, we have eliminated four high-cost furnaces, including the recently announced Waco plant closure. We continue to evaluate further optimization opportunities to further boost earnings and ROIC. Ultimately, we aim to reposition our North America business towards more profitable, fragmented categories, which are a great fit for MAGMA in the future. Our first MAGMA greenfield will serve key spirits customers, the craft distillers along the Kentucky Bourbon Trail, as well as our O-IPS distribution unit, and is a great example of the future direction of this business. Third, O-I is expanding and accelerating our margin expansion initiatives. This includes numerous automation and productivity projects, as well as additional organization restructuring actions. Fourth, we are reducing our capital expenditures. We remain focused on completing our MAGMA greenfield plan by mid-2024, yet we have extended the timeline of our expansion projects in Brazil, Peru, and Scotland by 6-12 months to better align with the market recovery. While we're most concerned with the macros, we are again taking proactive measures to drive improvement across the business layers that we control, as we aim to deliver a strong performance next year. This leads to our initial discussion on 2024, and now on slide 10. Consistent with prior years, we will provide our 2024 financial outlook during our fourth-quarter call. However, we are sharing our preliminary view on the five key levers that drive our business performance. Keep in mind, we have good line of sight on the levers that we can control, such as cost management and CapEx, while it will take some time to gain clarity on certain market-driven factors. As discussed, we expect low- to mid-single-digit sales volume growth next year. Following aggressive efforts to reduce inventories in the fourth quarter, we anticipate some temporary production containment in 2024 to maintain inventory levels, but it's too early to be precise here. It will likely take more time to get a clear view on net price. Importantly, net price realization should be favorable on the 55% of our business covered by long-term contracts, which include price adjustment formulas that record inflation on a lagging basis. Yet, Net Price Realization on the remaining 45% of our business, covered by annual price agreements, will be subject to future market dynamics, especially the rate of demand improvement. Importantly, Europe represents 1/2 of our open market agreements, and we expect to negotiate most terms starting later this month and extending into early next year. Operating costs are expected to be down, reflecting our enhanced margin expansion initiatives and accelerated restructuring actions. While unfavorable inventory revaluation and lapping one-time energy credits are known headwinds. Our initial CapEx plan approximates $550 million-$575 million, which is down substantially from around $700 million this year as we proceed with the MAGMA greenfield and adjusted timing of a few expansion projects until markets recover. Finally, interest expense should be consistent with prevailing rates. As you can see, we are taking active measures to drive performance across several business layers. We expect to provide full year 2024 guidance during our year-end earnings call. Let's turn to slide 11. As we take a longer-term view, I firmly believe our strategy will create significant shareholder value as we further strengthen our financial profile, successfully execute and leverage our transformation program, enable long-term profitable growth, advance breakthrough innovations like MAGMA and ULTRA, and execute our enterprise sustainability roadmap, which is now fully integrated into our overall business plan. Our capital allocation priorities are well aligned with this strategy as we continue to improve our capital structure, fund profitable growth, and return value to our shareholders over time. Let me conclude on slide 12. O-I continues to execute well in a challenging environment. We are pleased with our third quarter performance, which exceeded both our expectations and prior year results as we continue to advance key strategic objectives. We expect strong 2023 results, with adjusted earnings up about 30% from the prior years, representing the best performance in the past 15 years. While we contend with elevated market uncertainty, we are taking action to drive a strong performance as markets recover. Finally, we remain highly focused on executing our compelling strategy to create long-term shareholder value. Thank you, and we're ready to address your questions. Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you choose to retract your question, please press star followed by two. When preparing to ask your question, please ensure your phone is unmuted locally. We ask you please limit yourself to one question and one follow-up. If you wish to ask another question, please rejoin the queue. Our first question goes to Ghansham Panjabi of Baird. Please go ahead. Your line is open. Hey, guys. Good morning. I guess first off. Good morning. Can you just give us a bit more color on the sequencing of volumes throughout the third quarter? You know, down 9%. How'd that played out? I mean, was there any sort of dislocation in particular during the quarter? Anything from a regional standpoint that you might want to call out, as, as the quarter sort of unfolded? And then as it relates to production curtailment, specific to, in the back half of the year, including 3Q, how did, how did that play out, geographically? And I heard, I heard the comment about 20% in the fourth quarter globally, but was there anything unique with 3Q? I'm just trying to understand the margin divergence between the segments. Thanks, Ghansham. So, we saw improvement, sequential improvement, during October. As we look back to the quarter, it was increasingly lower volume as we went through the quarter. So August was higher than July, as well as September higher than August. But October showed an improvement in certain regions, and if we look at this regionally, in Europe, we saw some normalization in beer and NAB when we compare to 2022 levels. And in North America, we saw some stability in food and NAB. And as we described in the opening remarks, in the Andean, we moved from a strong decline to a strong growth, and that's now leveraging the investment that we made in that region, which was substantial. And that investment is in full operation and with full utilization at this point. Curtailment is pretty much evenly distributed across all our geographies in the fourth quarter. Yeah, yeah, Ghansham, I can, I can add on that. In the third quarter, most of our curtailment activity was focused in the Americas. As you may recall, earlier in the year, we had seen very low inventory levels in Europe, and we were stocking out across Southern Europe. So, more of that curtailment activity started to kick in more like in the September window. But as we go in the fourth quarter and we look at 20% curtailment, we're going to see it pretty equally spread between the Americas and Europe. Okay, great. Thanks for that. And then in terms of, you know, your current curtailment, inventory reduction, if you will, for the fourth quarter, do you anticipate that'll be enough, as it relates to realigning supply and demand by the end of the year? Or will it be any slower into, into the first quarter of next year as well? Well, what we're doing in the fourth quarter is, we made a decision to curtail, adjust inventories to forecast and better position the company to go into 2024. Yeah, how far do we need to go with the curtailments in 2024 will depend on how demand evolves as we go into a year. But what we're doing in Q4 is a significant adjustment. That's why it adds up to $0.37 impact, $0.30 impact, which is pretty much what's changed the performance of the quarter versus our leading guidance. Yeah, I would add, there, Ghansham, if we look at the end of 2022, the IDS in our business was in the low 40s, and which is probably too low. And as I mentioned before, we were seeing some stockouts when we were at that type of level. Probably the more effective level for us is about 45-50 days. We'll probably end the year plus or minus that 50 zip code. It really, you know, there's—it's hard to be super precise in this regard, but that level, I think, is an effective position for the company. And you know, as we go forward from that, you know, if we're able to achieve that in the fourth quarter, we should be able to keep curtailments kind of in line to maintain inventory levels, rather than having to take another slug down. But it's a little too early to be super precise, given the level of variability out there. And what I would say overall is entering the year, we thought working capital would be about a $50 million or so use of cash. It'll probably be closer to a $100 million use of cash, again, because the inventories might be a little higher on that range than the midpoint or lower of the targeted IDS point. Understood. Thanks so much. Thank you. Thank you. Our next question goes to George Staphos of Bank of America. George, please go ahead. Your line is open. Thanks very much. Hi, everyone. Good morning. Thanks for the details. Good morning. I recognize we'll get more color as the year goes on in February when you do your fourth quarter. But is there a way. It is a figure that you say you have a better line of sight on, if I'm on slide 10 in terms of operating costs. So at this juncture, what do you think you should be able to drive in terms of margin enhancement that is within O-I's control for 2024? And then I had a quick follow on. Yeah, George, you know, while I'm not going to provide a specific dollar, I can give you kind of a sense of the magnitude. As you know, on historic years, our margin expansion initiatives, we were targeting about $50 million a year and generally did better than that. This year, we're targeting $100 million, and again, doing better than that with a lot of improvement coming out of North America. As we said in the prepared comments, we're looking to accelerate that. So I think another strong year, stronger year in 2024 on operating costs is very likely. And as alluded to in the comments, we continue to, you know, take an aggressive position on the costs, on the margin expansion initiatives, and accelerating the restructuring activities. As you know, there's a handful of our plants. We've closed some plants already that were actually in negative earnings territory, and then we closed those out. That will provide a nice boost in the next year, in addition to whatever additional restructuring activities that we do going forward. So it should be a robust year in operating cost improvement. Thanks for that, John. And maybe related to that, then a quick follow-up, and I'll turn it over. So again, I recognize it's going to have to wait until February, but you mentioned we have the margin expansion. You have some curtailments, perhaps that'll linger into next year. You're still, you know, working through net price, but you know, for 55% of your business, it should be a positive. At this juncture, would you expect 2024 is a better year than 2023, or is it more likely that it would be down? And then just taking a step back, the volume trends for O-I, yes, we've heard about destocking throughout the packaging and paperboard sector for the last several quarters, but your numbers have been, you know, seemingly a bit worse in that regard. So why do you think glass and you are going through a greater amount of destocking versus other substrates, if you've been able to analyze it? Or maybe you disagree with the premise of the question, and, if so, explain why. Thanks, guys. Good luck in the quarter. Yeah, when we compare volumes, just to the second part, volume trends, we compare with other glass suppliers. I think our performance is quite similar. The difference comes from the markets in which we operate. So all companies are not exactly in the same market, therefore, they won't have the same total number. But when we disaggregate that to the extent we can, we identified similar trends for O-I, as the market in general is having. Yeah. So on the first point, George, as far as what to expect in 2024 to 2023, I think we laid out, you know, the major drivers pretty well there. You know, volume should be up. You know, a good operating cost improvement. Although the wild cards that we just can't really call right now is included in the comments is what will the inflection point be on volumes and how will that be? Is it at the low end or the high end of that range? And that's, you know, it does impact the earnings, you know, potential of the current year. As well as, you know, the negotiations of price in Europe, which haven't even begun yet. It's hard to make a call on those. A couple things I would say is I think the second half of the year is gonna be, you know, definitely stronger than the first half of the year, and probably show a pretty good run rate in the business, as we clearly go past that inflection point. Another thing I would say is, you know, as painful as it is right now, we're taking a pretty big hit on, you know, the operating leverage of the company with lower sales and production volume, but it also means that we got very good operating leverage to recovery. You know, we, you know, we're probably gonna be over $300 million and some odd impact in lower sales and production volume this year. So as that recovers, that's a pretty good operating leverage on the upside. It's just the timing that's particularly difficult to be able to call right now. Okay. John, thank you. Thank you. Our next question goes to Mike Roxland of Truist Securities. Mike, please go ahead. Your line is open. Thanks. Thank you. Thank you, Andres, John, and Chris, for taking my questions. Just wanted to follow up on George's question regarding the the MEI acceleration. It sounds like a lot of this is either, you know, plant optimization, or and/or pure cost takeout, as you said, with respect to plants. So can you just help us frame the different buckets that you're targeting for the MEI acceleration? And can you let us know if there are any costs associated as you accelerate MEI? Yeah. Yeah, I would say that there's probably four buckets there. One is on the commercial side. You know, we have what we have are called our PRO initiatives, price revenue optimization, and in particular, in today's environment, those can be valuable. It's making sure that you're compliant with contracts, it's that you're doing value-based pricing, and that you're getting things really down to the nub, and specifically on an account-by-account basis. That tends to provide benefits. You know, Andres alluded to two areas, too. One is accelerated automation activities, and that one does have some additional costs. It's embedded into CapEx. We probably will scale up labor automation, you know, palletizers, those, those types of projects, to be able to take labor costs out, which, as we all know, right now, are quite elevated. The fourth one is on plant productivity, speed, efficiency, things like that. We've made really great strides over the last year on those particular categories, and we continue to think that there's legs on that. And then the last one would be on the OpEx side, on the organization element. And maybe a fifth then is particularly what are we doing in North America, you know, where we are looking at a pretty wholesome set of activities. It's, you know, it's the price realization on our contracts that have been renegotiated in the last year. It is, again, very focused performance going on in that business. We've seen very good operating improvement across a lot of the base. That's allowing us to close higher-cost capacity and move that volume into higher, more efficient, you know, highly more efficient, more profitable facilities. That all has a very good EBIT boost to it when you do that, too. So, while there's some one-time restructuring costs associated with that, those are usually, you know, paybacks of 9-12 months or something like that. So, you know, those are the kind of the different pieces. Something to complement that. Everything we're doing on the restructuring side for the North America market will be followed by strategically deploying MAGMA to access high-margin fragmented business. And this is already starting with the greenfield in Kentucky, which is serving exactly that high-margin business, growing segments. Got it. Thank you for that. Just one quick follow-up, would be just in terms of the weakness in volumes and economic downturn that you're taking in the Americas, can you comment on how Canada and Colombia are currently operating? And then realizing that you're pushing out the CapEx and deferring Brazil, Peru, and Scotland, do you feel that those deferrals put you at a disadvantage when, if and when, volumes return? Thanks very much. Yeah. So Colombia is doing quite well. We made a large investment for expansion, for per-hour growth. Earlier in the year, we faced the same volume slowdown that we're facing in other markets. It was quite pronounced, but it already reverted 100% to growth. And at this point in time, we're growing either high single digits or low double digits, so it's pretty healthy. And with that, then that operation is in full utilization. It's operating really well. We're very happy with the investment that we made. The situation in Canada, that's to serve localization of global brands, which is a trend that is taking place around the world. So that has secured volume, it's been completed and is now in operation and is doing well, too. So, we're very pleased with the evolution of those two investments. In the case of Brazil, Peru, and Scotland, we are to serve high margin growing businesses with all those investments. What we wanna do with them is time them properly with the evolution of demand. At this point, demand is down, so it doesn't make any sense to accelerate this. So we're just timing the investments with demand, and we will move forward with the advantages that those markets offer. In Scotland, for example, this in the Scotland investment, we are supporting this high-value spirits business, which is a growing category. So we will move forward with that as soon as demand recovers. One thing I'd add on the latter part there is, when we take a look at the CapEx, we're not just walking off the job sites of those particular facilities. We're actually, and you'll see it in our CapEx in the fourth quarter, it's still elevated. We are positioning those projects so that when we get signs that the volumes are returning, we can quickly get back there and finish them up and bring them online, rather than having to kinda, you know, start off from scratch, so to speak. So I think that's an important element as we think about it going forward. embedded in our $550 million-$575 million next year, is the fact that towards probably the later part of the year or something like that, we are putting in some more CapEx into those facilities and wrapping them up. So, you know, some of that, you know, finalization costs will be in the back half of next year. A little bit might drag into 2025, but we wanna make sure that we're able to respond pretty quickly. Yeah, there are a couple of additional data points. Thank you, Andres. As regards to demand. Yeah, I just wanted to complement that whole demand landscape. So, we're seeing a significant level of activity on new product development in the Americas. And so that's something that should support recovery. And one of that is taking in the Andean countries, in the markets in which there is significant opportunity for premium products development. And when we look at Brazil, the consumer consumption is quite healthy. And glass, however, is doing quite well in that market, and it's been growing in line with premium beer growth for the one-way containers, which is in the mid-teens, and returnable containers are emphasized. So the challenge over there is not consumer at all, it's just the stocking, which is driven by a significant amount of imports that happened when the supply chains were disrupted, and now is being consumed. So the local orders are lower, but that's a temporary issue. But the consumer itself is in a very good place, so we will move forward with the investment over there as soon as we clear all these demand fluctuations. Very helpful. Thanks very much, guys. Good luck in the quarter. Thank you. Thank you. Thank you. Our next question goes to Anthony Pettinari of Citi. Anthony, please go ahead. Your line is open. Morning, this is Bryan Burgmeier on for Anthony. Thanks for taking the question. You know, I appreciate- Good morning, Bryan. -all the color you've provided on 2024. Just wondering if you can add, you know, any detail on sort of your low- to mid-single-digit volume growth assumption. You know, I think slide eight points to maybe a 2Q inflection in both retail consumption and O-I's production. You know, what are your customers telling you that sort of makes you feel confident in that target date? Let me provide some input first, with regards to the supply chain. So, we identified two different supply chains in our system. The one for the short supply chain that we call, which is related to beer or food or NABs. And we are expecting that that supply chain will start to normalize as we exit this fourth quarter of 2023. And there is also a long supply chain, which is spirits and wine, and for that one, we expect that normalization will start in as we exit the first quarter of 2024. So that's incorporated in our projections at this point, and we are seeing some evidence of that behavior. So the short supply chains are already starting to show some initial signs of normalization. Yeah, I would say, as you can expect right now, we're having a lot of conversations with our customers to understand what their intentions are. In building off of Andres's comments, some are pointing that, "Hey, we're coming to the end right now, towards here, the fourth quarter." Some point to the first quarter, some point to the second quarter. So our outlook is based upon looking at macro information, looking at in-industry, you know, data that points to trends and whatnot, and it also relies very heavily on what our customers are telling us in that regard. So it, it's really, you know, looking at all three of those variables to come to this conclusion. Of course, nobody has a crystal ball, but it seems to triangulate quite well with all the different inputs that we're hearing from those different sources. Got it. Thanks for the detail. You know, last question for me, you know, with CapEx maybe coming down a little bit next year, you know, what do you view as, like, the best use of cash here? Is this the time to maybe buy back some shares? Do you wanna maybe see net leverage closer to 2.5x? Do you have any bolt-ons maybe in the pipeline? Just any thoughts you can provide would be helpful. Thanks. I'll turn it over. Yeah, sure. I think our intention, as we've communicated consistently in the past, is that, you know, we're looking right now to reduce debt to that line of sight at 2.5 x leverage. We're getting close. You know, I, you know, we had indicated before that, you know, the inflection for looking at other more, you know, returning value to shareholders through either a dividend or share buyback could be something that we approach here sometime in the next year. That very well could be valid. Of course, I think, you know, with the macros being what they are, it might take a another quarter or two for things to stabilize itself out, in which case then once you got good line of sight to that 2.5x, again, we're not that far away from it, I think we're entering into the territory of looking at those other options. Ultimately, though, of course, this is a decision for the board of directors. Thank you. Our next question goes to Arun Viswanathan of RBC Capital Markets. Aaron, please go ahead. Your line is open. Thanks. Yeah, I wanted to ask about the volume trajectory. So, maybe you could walk us through how you're thinking about 2024. I understand, you maybe put out some guideposts there, but, are we really looking for maybe a couple points of growth off of new capacity, maybe some resumption of growth in premium categories, and maybe the end of destocking in some of the lower velocity areas, like wine and spirits? Maybe you can just walk us through how you're thinking about how volume evolves over the next, say, 12 to 18 months. Thanks. Yeah, I mean, I think it's obviously a complex set of activities right now. We do believe, you know, building off of what Andres had indicated before, some of those faster value chains, you know, the beers, the NABs, you know, the food categories, probably, you know, start to show growth sooner rather than later. Obviously, every segment has its own, and every market has its own set of dynamics. Whereas, spirits and wine, for example, might take longer. They entered into their destocking process later than we had seen with some of the other ones. And so. And that's consistent also with what we're hearing from our customers. I think the view is Latin America obviously hasn't really seen significant downside, and so, as Andres indicated before, we're already seeing robust growth coming in with the expansion in the Colombian marketplace. You know, the northern part, you know, North America, et cetera, is actually doing fairly well. You know, now I think the European markets might take a little bit longer to recover, at least in some of the different categories, the longer value chain categories, overall. And I think the key segment we got to follow or track closely is the wine segment in France. That's really where the largest slowdown is at this point in time. So as we continue to update, we'll look at that more specifically. Great, thanks. And then, as a follow-up, I was hoping to ask about your energy hedges. Apologies if I missed this earlier, but could you just update how we think about price versus, you know, energy costs, over a similar range, maybe the next 12-18 months, and what you're doing to, maybe roll out or extend some of those hedges? Thanks. Yeah, sure. And, you know, for clarity, we take a three-year view minimum on our energy contracting positions. So as we stand here right now, today, you know, we have contracted substantially through 2025, for example. And those were done at very favorable rates, as we mentioned in the past, you know, more indicative of rates before the pandemic or before the Ukraine war. So, those rates are favorable. What we had seen is, you know, energy, if you look at just TTF over in Europe, which is probably the most dynamic one, rates were coming down to, you know, they were over 50 EUR per megawatt hour. They dropped down into the 30s here more recently, but frankly, with the advent of the Israeli-Hamas conflict, we've seen things jump back up to 50 again. And if you look at the forward curves, they stay in the 50s over through 2025 and then start to tail off in 2026. So even though, you know, the spot markets and are elevated in energy, probably 2x, 2.5x what are contracted at, you know, we, we aren't exposed to that level of variability. Thanks. Sure. Thank you. Our next question goes to Gabe Hajde of Wells Fargo Securities. Gabe, please go ahead. Your line is open. Thank you, Andres, John, Chris, good morning. Good morning. Morning. I wanted to maybe, I guess, ask or carry on to that talking point there, John, in terms of cost competitiveness of glass. Appreciating that, you know, filling can't be switched overnight, these things take investment. Any thoughts into our visibility, either, you know, based on order patterns or anything like that, that you can offer up in terms of more on the beer side, I'm thinking? You know, potential for substrate shift in any of your markets, and in response to that, you know, potential internally you're planning for if some of those orders don't necessarily come back, your ability to kind of close those plants. And the curtailments that you're talking about, are those sort of warm idles, the furnaces, or have you taken any cold shuts at this point? So the competitiveness of glass versus other packaging, and in particular, aluminum cans, is back to pre-pandemic levels. During the last few years, that gap closed a little bit, and it went back to where it was back in 2019. Now, you might have heard some growth in some regions or markets for aluminum cans. And when we look at that, remember that we mentioned before that glass can, aluminum cans play in different lanes, and the type of products that drive the growth in cans are products in which we are not present. So I think it's important to highlight that. When we look at share, we haven't seen that much share shift, minimal really, and it's primarily driven by down trading or promotions, and we consider those to be temporary. Yeah, you know, I think even on that last point is, you know, you can even see that specifically in the Nielsen data. You know, you look at the volume trends and consumer consumption trends, we can see what the overall trends, we can see how the products are being consumed in glass containers and aluminum, you know, cans, for example. And everything's within like a percent or so of each other. I mean, given the level of variation that we're seeing out there, it's all within a relevant range. So yeah, maybe there's a little bit of downshifting a little bit going on there, but it's not a material difference, given, you know, the scale of the change that we're seeing out there. You know, on the furnace position you asked, we are taking those cold. So, for example, Waco is closing, so it will be a cold furnace and not operating anymore. Okay. I'm appreciating that you guys operating in relatively different markets than, than some of your peers, and I'm more specifically thinking about Europe. But just there, there's been a lot of volatility in that market, in the past four years. And I'm just curious, again, you know, you pointed out elevated conflict in the Middle East and, and rising energy costs. Are you hearing anything from the competitive landscape that some of these smaller folks, may not be able to react or, or have the financial wherewithal, to withstand another shock to the system? And is that a consideration in, in some of the discussions that you're having with your, your customers? And then there was also a recent, I think, change of control, for, for one of your peers in Europe. Again, to the extent you can comment anything in terms of competitive landscape that you'd expect to be different there. Yeah, you know, it's hard to read through all the competition. I mean, they have to report on their own positions. But, you know, when we saw the energy prices, for example, in Europe, go up last year, you saw, you know, the smaller competitors who typically don't have a sophisticated energy management position going offline. So if in the event that, you know, that there's more escalation and more of an energy shock, then I suspect that there is an exposure there for them. Obviously, in the discussions with our customers, continuity of supply has always been important. We saw that last year in particular, and I think we did quite well in that regard. We were able to be a solid supplier, you know, for our customers out there. And as you take a look at it right now, you know, we're taking, as I mentioned before, 20% curtailment out there to balance off inventories. You know, clearly, you can research it on your own, but, you know, if you take a look at other public information, it seems to be a consistent practice across the marketplace. Thank you. Thank you. Thank you. Our next question goes to Roger Schmitz of Bank of America. Roger, please go ahead. Your line is open. How much of your inventory your customers typically hold, say, in days or weeks, where we were at the beginning of the year and where we might be at the end of the year in rough numbers? Yeah. So I think when we look at the destocking, the destocking is influenced not just by the inventories of customers, but it's distributors, it's wholesalers, it's retailers, and it's even consumers, depending on what supply chain we're talking about. So, for us, the way to look at this is short supply chains will recover faster, and we're starting to see some early signs of that in some markets, and long supply chains will take longer. So, the short one, the short supply chain to recover as we exit this quarter or normalize as we exit this quarter, and the long one as we exit the first quarter of 2024. Yeah, I would say you get such a wide range of different practices by different, you know, industries. For example, the distributors in beer in North America hold on a few weeks of inventory. But you take a look at that same wholesaler channel for wine and spirits, it's months up to a year in certain different categories and things like that. So, it's hard to try to get an average in there. I think what we've been able to see is that the inventories at the retail level have started to trend down to maybe more historic levels. But then, you know, there's still some inventory, you know, higher inventories, more or less in that wholesale channel area that need to be worked out. That's what's kinda supports that there's probably some destocking left for the next few months, but ultimately, kinda working its way through the value chain. Thank you very much. Yeah. Thank you. Thank you. We have no further questions, and I'll hand back to Chris for any closing comments. Thanks, Nadia. That concludes our earnings conference call. Please note that our fourth quarter and year-end call is currently scheduled for February 7th. Remember, make it a memorable moment by choosing safe, sustainable glass. Thank you. Thank you. This now concludes today's call. Thank you for joining. You may now disconnect your lines.