Good day, and thank you for standing by. Welcome to the Third Quarter 2022 Sonoco Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Lisa Weeks, Vice President, Investor Relations. Please go ahead. Thank you, operator, and thanks to everyone for joining us today for Sonoco's Third Quarter 2022 Earnings Call. Joining me this morning are Howard Coker, President and CEO, Rob Dillard, Chief Financial Officer, and Rodger Fuller, Chief Operating Officer. Last evening, we issued a news release highlighting our financial performance for the third quarter, and we prepared a presentation that we will reference during this call. The press release and presentation are available online under the Investor Relations section of our website at www.sonoco.com. As a reminder, during today's call, we will discuss a number of forward-looking statements based on current expectations, estimates, and projections. These statements are not guarantees of future performance and are subject to certain risks and uncertainties. Therefore, actual results may differ materially. Please take a moment to review the forward-looking statements on page 2 of the presentation. Additionally, today's presentation includes the use of non-GAAP financial measures, which management believes provides useful information to investors about the company's financial condition and results of operations. Further information about the company's use of non-GAAP financial measures, including definitions as well as reconciliations to GAAP measures, is available under the Investor Relations section of our website. For today's call, Howard will begin by covering a brief summary of third quarter performance. Rob will then review our detailed financial results for the third quarter, and along with Rodger Fuller, will discuss our guidance update for the fourth quarter and full year 2022. Howard will then provide a progress report on our strategic priorities, followed by a Q&A session. If you will turn to slide 4 in our presentation, I will now turn the call over to our CEO, Howard Coker. Thank you, Lisa, and good morning, and thanks to all of you for joining our third quarter call. As you read in our press release, we reported strong year-over-year performance where revenue grew 34% to $1.9 billion, and we expanded base EBITDA margins 200 basis points to 15%. Our base earnings per share of $1.60 was a 60% increase over the third quarter of last year. These results, which were above the high end of our guidance range, were enabled by stable consumer packaging demand, mainly from staple food items, strategic pricing in our commercial excellence initiatives, and overall improving supply chain conditions. As a result of our strong results year-to-date, we have increased our full-year 2022 guidance. This performance is another positive proof point for our continued successful execution of our strategic priorities in what remains a dynamic environment. Our teams have remained diligent in support of our customers while we continue the journey to build a better Sonoco. I wanna express a warm thanks to all of our team members for their incredible hard work during this period. With that, I'm gonna turn it over to Rob and let him take you through our financials for the quarter. Thanks, Howard. I'll begin on slide 6 with a review of key financials for the third quarter. Please note that all results discussed will be adjusted to base, and all growth metrics will be on a year-over-year basis unless otherwise stated. The GAAP to non-GAAP EPS reconciliation can be found in the appendix of this presentation as well as in the press release. The third quarter financial results again represented Sonoco's ability to deliver strong results from our core market positions. Sales increased 34% to $1.9 billion in the third quarter. This sales growth was driven primarily by the Sonoco Metal Packaging acquisition and an 18% increase in prices as strategic pricing efforts continue to both offset inflation and reflect the value we provide our customers. We've been steadfast in providing excellent service and availability to our customers, and we believe we are being rewarded for this in the marketplace. We grew volumes 1.6% in consumer, largely as a result of this commitment. Furthermore, our strong revenue growth is translating into operating leverage. Base operating profit increased 67% to $225 million, and base operating profit margin increased 240 basis points to 11.9%. Turning to slide 7. Base EBITDA increased 55% to $284 million, and base EBITDA margin increased 200 basis points to 15%. This focus on margin improvement is strategic and is backed by ongoing portfolio management actions, footprint optimization activities, value-enhancing capital investments, and strategic self-help programs. Finally, base earnings per share increased 60% to $1.60. This increase in earnings is attributable to strong operating performance, offset by $0.05 of negative FX and $0.09 of negative tax rate. The sales bridge on slide 8 provides the primary drivers for revenue growth in the quarter. Volume mix was negative $52 million or 3.7%. Our consumer segment continues to see strong growth in core RPC and flexible businesses. However, industrial volumes were down 9.5%, with the greatest impact in Europe and Asia, while notably the U.S. was also negative due to the number 10 paper machine downtime and continued weakness in the white goods market. Price was $250 million positive, up 18% in the third quarter. Consumer price increases were led by strong performance in our core RPC and flexibles businesses. Industrial price increases were led by strong performance in the U.S. and in Europe. Acquisitions increased sales $334 million as metal packaging completed their peak food can season, with food volumes up sequentially, offset by mid-single-digit year-over-year decline in aerosols. Aerosol volumes were impacted by inventory destocking as volumes normalized to pre-COVID levels. Acquisitions have been an important part of our historical revenue growth. Excluding acquisitions, organic sales growth was still 10% in the quarter. Foreign exchange and other was negative $57 million in the third quarter. As a reminder, 75% of our sales are generated in the U.S. Page 9 has our base operating profit bridge. This displays the operating leverage of our core businesses in the current market environment. Overall, volume mix was negative $14 million, again with strength in RPC and flexibles offset by lower volumes in industrials. Industrials was impacted by the shutdown of the number 10 paper machine as we completed the grade conversion from containerboard corrugated medium to high-value URB. We estimate this volume impact to operating profit was between $7 million and $8 million. Price cost was a positive $90 million benefit to base operating profit. Our core franchises continue to achieve strong strategic pricing performance, and price cost improved sequentially from the $79 million we achieved in the second quarter. The consumer business overall had strong price cost performance, generating over $20 million of favorability. The industrial business had strong price cost performance as well as we continue to benefit from strategic pricing while OCC costs continue to decline. OCC averaged $123 per ton in the quarter, and OCC prices are currently $45 per ton based on the Southeast RISI Index. Year to date, we have achieved $254 million of price cost. As a reminder, we experienced approximately $0.40-$0.45 per share of metal price overlap in the first half of this year, most of which is accounted for in acquisitions under the Metal Packaging business and not accounted for in price cost. Acquisitions and divestitures generated $32 million in the quarter as Metal Packaging continues to perform as expected. Margins in the business were lower than previous quarters due to normal seasonality associated with heavier mix toward seasonal food cans and lower volumes in aerosols. Other impacts on the quarter were -$18 million due to higher depreciation, non-recurring COVID benefits, and FX hedge wins, which impacted operating profit $6 million in the quarter. Slide 10 has our segment performance for the quarter. Consumer sales grew 72% to $1 billion, and operating profit grew 93% to $128 million. Operating profit margin increased 130 basis points to 12.4%. The primary drivers of this performance were Metal Packaging and strategic pricing, while productivity and volumes were also positive. Industrial sales grew 4% to $661 million, and operating profit grew 48% to $82 million. Operating profit margin increased 365 basis points to 12.4%. The primary driver of this performance was strong price cost performance with prices up and OCC declining, offset by lower volume mix, especially in international markets, and lower productivity due to planned downtime at the number 10 paper machine. All other sales increased 10% to $198 million, and operating profit increased 19% to $15 million. This growth was driven by strong strategic pricing performance while volume was essentially flat. Turning to slide 11. Our capital allocation framework is aligned to our business strategy to drive value creation for our shareholders. Our priority is to allocate capital to high return investments in core businesses to drive growth and improve efficiencies. From a free cash flow perspective, we remain committed to increasing the dividend, which is at present $0.49 per share on a quarterly basis or a greater than 3% average yield over the last 12 months. Year to date, we paid $193 million in dividends. After capital investments in the dividend, we prioritize investments in accretive M&A transactions aligned with our long-term strategy. We'll manage capital to optimize our balance sheet and to retain our investment-grade credit rating. During the quarter, operating cash flow was $138 million, and capital investments were $87 million. On slide 12, we have our updated guidance. For fourth quarter, our EPS guidance is $1.20-$1.30. We're increasing our full year EPS guidance to $6.40-$6.50, a $0.20 increase from previous guidance. We're increasing our full year expected base EBITDA guidance to $1.14 billion-$1.16 billion. This record performance is based on our continued strong strategic price performance and a stable market environment in our defensive consumer markets. We're reducing our operating cash flow and free cash flow guidance by $100 million due to increased working capital demands. Current elevated working capital is associated with inflation and disrupted supply chains, both from our suppliers and our customers. As supply chains normalize, we anticipate inventory to normalize and benefit cash flows. While this is occurring now, we expect higher free cash flows in 2023. For your reference, we've included additional modeling information in the appendix of this presentation. Now, Rodger will discuss our outlook on a segment basis. Okay. Thanks, Rob. Please turn to slide 13 for our view on segment performance, which supports our fourth quarter guidance. Across consumer, volume trends are seasonally lower in the fourth quarter. In our legacy packaging businesses, we have lower planned shipments from pre-holiday stocking of some packaged foods and lower seasonality of fresh fruits and vegetables in our plastic clamshell business. We see another overall solid volume quarter for both global Rigid Paper Containers and flexibles, given the seasonality. In the Metal Packaging space, we're seeing solid volume in food cans sequentially to Q3, offset by aerosol cans, which continue to trend lower than the COVID highs. We continue to invest heavily across the consumer business for innovation and around new sustainability programs to support global growth in snack packaging and in overall efficiency projects aligned to our operational excellence programs. Finally, in consumer, we believe we'll continue to benefit from previous strategic pricing initiatives, as well as relative stability in our raw material costs. In industrial converting, we don't expect volume recovery in Europe and Asia in Q4, and we are seeing slowing industrial demand in North America, as many of our customer bases are reducing inventories prior to calendar year-end. The global tube and core market is experiencing slowing demand in paper mill core, supplying the containerboard market, and housing-related markets like textiles and flooring products. On the paper side of the business, with our number 10 machine now operational in North America, we've begun production qualification ramp-ups for new paper grades and are balancing supply with demand to maintain reasonable backlog levels. In Asia, Europe, and Latin America, weaker economic conditions continue to drive lower demand. The lower demand for URB globally is allowing us to complete some overdue maintenance in the fourth quarter, which will allow our paper machines to return to more normal run sizes and reduce changeovers, which should positively impact pro-productivity as we move into 2023. Similar to consumer products, we're continuing to execute our capital investment plan in industrial. Sustainability will continue to drive the need for additional paper production capacity, and we'll continue to invest capital for machine upgrades on our best paper assets. On the pricing side, our commercial excellence programs continue to generate beneficial strategic pricing. With the steady Tan Bending Chip Index, to which the majority of our pricing is set, with lower overall OCC pricing, and the management of our ongoing energy challenges, we expect favorable price cost benefits to continue in the fourth quarter. Finally, in our all other businesses, we have stable demand across most of our products, including transit packaging for pharmaceuticals and seasonally improved demand for vaccine shipments. Similar to consumer and industrial segments, European markets remain soft. We're continuing to drive value from strategic pricing and activities, manage non-material inflation, and expect to benefit from declining resin prices in the fourth quarter. With that update and look at the fourth quarter, I'll turn it over to Howard. Okay. Thanks, Rodger. If you'll turn to slide 15, I'm pleased to announce that in the third quarter, we did release our updated corporate responsibility report, which demonstrates Sonoco's commitment to environmental, social, and governance principles. I'm very, very proud of the progress we've made. Okay, we just lost power at our location. If you guys can bear with us for one minute, if you're still on, we'll try to get that rectified. Okay, we have had to shift from lamps to flashlights. You did pay the bill, Rob, didn't you? Let me see if we can pick up close to where I left off, and we'll keep going as we try to figure out what's going on here. As I was saying, sustainability is a key driver for innovation in our new product design activities, as Rodger had mentioned, and we continue to grow with both existing and new customers, where our solutions provide differentiation and enable our customers to win in their markets. While there is much more work to be done, you can see from our numerous partnerships and memberships that the decisions we make are motivated by our mission, which is to create sustainable packaging solutions that help build our customers' brands, enhance the quality of their products, and improve the quality of life for people around the world. That is why I'm pleased to announce progress on one of the most significant investments in Sonoco's history. On page 16, slide 16, we have an update on Project Horizon. In mid-2020, we announced our efforts to modernize our Hartsville paper mill's operations with plans for one of the largest and lowest cost URB manufacturing centers in the world. This project fully aligns with our sustainability mission to transition Sonoco globally into production from only 100% recycled fiber while reducing electrical consumption, greenhouse gas emissions, and total water use. In the third quarter, we successfully completed the number 10 conversion from medium to URB, and now have the capability to make a number of high-end grey paper grades. As planned, we have taken down the number 1 and number 9 machines in Hartsville and expect to wrap up number 10 through this quarter and into next year, where at volume, our cost savings opportunity should be somewhere in the neighborhood of $30 million. Additionally, as indicated on slide 17, I'm very pleased to announce our intent to acquire Skjern Paper in Denmark. The rationale for this deal is straightforward for Sonoco. We need more lightweight production capacity in Europe to support our customers' transition to sustainable paper packaging. We see a long runway of opportunities for our rigid paper containers in Europe, and Skjern is a key part of ensuring continuity of supply. Skjern manufactures only from 100% recycled paper and has robust sustainability programs in place for renewable energy powered by a biomass boiler system, similar to the one we have here in the Hartsville complex. In 2022, the company is expected to achieve $50 million in sales, and this transaction is expected to be accretive to both earnings per share and cash flow, and we expect the transaction to close this quarter. Now if you'll turn to slide 18, I want to remind you that we continue to execute a playbook to fundamentally change the company. We're simplifying our portfolio into fewer, larger businesses where we have a right to win. If you look back over the last several years, we have purposefully realigned our portfolio to a more stable consumer defensible markets, which now represent over 50% of our annual sales. In parallel, we continue to refine our global footprint to maximize efficiency while we support our customers' changing needs. We also remain focused on aligning our organizational structure and talent to support these larger scale businesses with a simpler infrastructure as part of our structural transformation initiatives. Core to these changes is our commitment to build a diverse and inclusive workforce at all levels of the organization, which is vital to the heart of the Sonoco culture. As Project Horizon and the Skjern Paper acquisition demonstrate, we have invested and will continue to invest for the long-term growth of our core businesses. These investments, along with our commitment to self-help actions, will sustain and expand margins well into the future. Central to all our activities is our commitment to execute on sustainability initiatives. We have a number of innovative projects with our customers and suppliers, where we're intentionally aligning our long-term development roadmaps for improved recyclability and the commitment of a circular economy. We have some of the best technical experts in the business focused on these initiatives day in and day out. In closing, all these activities are focused on creating a better portfolio, a more resilient foundation, and ultimately, a more agile company. I'm confident in our long-term strategy and the foundation that we are building. As we look ahead, we will remain focused on consistent execution as we continue to invest in the future of Sonoco. Let me say thank you for your support, and we'll open up for any questions that you may have. As a reminder, if you'd like to ask a question at this time, please press star one one on your telephone. Please stand by while we compile the Q&A roster. Our first question comes from the line of Anthony Pettinari with Citi. Your line is now open. Good morning. Morning, Anthony. Hi. On the updated free cash flow guidance and inventory headwinds that you called out, can you talk about maybe expectations or visibility into maybe recovering, you know, some of that $100 million in 2023? I guess relatedly, you know, directionally, you know, how much price cost benefit do you expect that you could carry over into next year, just given kinda current run rates for inflation and the pricing that you have in place now? I'm thinking specifically on URB, but maybe just for the broader company. Rob, you wanna grab that? Yeah. For net working capital, I'd say there's two parts to that. I mean, what we anticipated was really good. The impact on 2020 is really good timing. You know, we had anticipated supply chains would cure somewhat in the third quarter, and that we would be able to take out, you know, some working capital, which is the delta really, between the year and what we had initially expected. We do see that coming out now, and we anticipate that that will come out through the balance of this year. Though I think that $100 million just rolls into next year, where we think next year, working capital should be a, you know, around a $100 million benefit versus, you know, this year being a -$200 million-$250 million detriment to cash flow next year. We're really, you know, bullish on how next year's gonna shape up from a working capital perspective as supply chains normalize and we're able to really get back to normal in how we operate the business and how we're buying, how we're utilizing our procurement assets. On price cost, you know, I would say we're more thinking about the headwinds of the metal price overlap from last year and the benefit that we got in the first half of the year. We're thinking a lot about industrial price cost right now. Obviously, that's a real tailwind. I think we're very cautious to, you know, think a lot about industrial volumes in the fourth quarter and then the first half of next year, and really kind of tempering our price cost expectations due to that. Okay. That's very helpful. Just in the consumer business, can you talk about how demand trended over the three months of the quarter and then into October? Did you see any kind of meaningful change or step down there? Just on customer inventory levels, you referenced that quickly, but is inventory de-stocking kind of a significant headwind in the consumer business, or is it something that you anticipate as being a headwind in 4Q? Yeah, Anthony, I would say we saw pretty normal seasonal build during the quarter. You know, we're towards the end of October, and again, seeing a very robust activity on the consumer side. I think Rodger talked to that in terms of the volumes. Feel very, very good about the trends we're seeing in consumer. On the inventory side, that really was more driven off of what we're hearing from our industrial customers saying they're needing to draw down just as we and many, many folks across the board are talking to in terms of their working capital. Rodger, I don't know if you've got any more to add to that. No, that's right. No, Anthony, you know, globally, especially textiles and some of our, any kind of housing related, activity, we're seeing a real pullback. You know, just about all textile companies announced incremental downtime over the holidays. What we're doing is getting out in front of that by, you know, taking the maintenance downtime that we need in the fourth quarter. For now, what our customers are telling us is it's inventory reduction. It's not necessarily consumer spending. We'll have to see how that plays out in the first quarter of next year. Okay, that's very helpful. I'll turn it over. Our next question comes from the line of George Staphos with Bank of America. Your line is now open. Hi, everyone. Good morning. Thanks for the details. I wanted to hit on a couple of strategic points, one on value-based pricing, the other on self-help and productivity. Howard, can you talk a bit about qualitatively or in terms of talking about initiatives, where you stand on value-based pricing? I'm not looking for a dollar amount of benefit next year, although I'd take that if you wanted to give it, but more in terms of, you know, the types of activities, the type of analysis that you're doing. By 2023, are you largely done? Are you largely done now? That's the flavor I'm looking for. In terms of self-help, I seem to recall self-help is gonna be a larger driver of 2023. Is there a way you could give us a bit of an update there and what the dollar amount in this case could actually benefit 2023? A couple of follow-ons. George, let me handle the self-help side, and I'm gonna pass on to Rodger. I have difficulty understanding the first part of the question. Sorry. We've got technical issues here in Hartsville. You know, on the self-help side, not to put out a specific number, but, to kind of walk through, you know, some of what I talked about in my narrative and have been discussing all year is really how we're looking at the structure of the company, focusing on the four core businesses. To be clear, the parenting strategy that we're undertaking right now is that, we have the all other category and then the four foundationals, which we're calling our can businesses, our industrial and our flexibles businesses. Those will be supported from center. Right. As opposed to all other. With that is going to drive productivity and opportunities. We're finishing that work up yet. You know, as we get into our budget season, which is just happening right now, we'll have better clarity on exactly what type of economic implications that that's gonna have. You know, the other self-help has to do with the investments that we've been making. Number 10 has been the poster child. It is the largest single, but as you can follow over the last several years, we have increased our capital outlay from an organic perspective, you know, materially. There's just a number of projects that actually would surpass in totality the size of number 10 that are going across those core businesses that we see or that should be and will generate really nice productivity. That started about two years ago or so it takes about that period of time. We should see that. That's a big expectation for next year. You can see our productivity numbers. We're gonna see those not only return to the normal level as supply chain disruptions lessen, but also as these capital initiatives start coming into place. I guess finally, I'd say on the capital perspective, that's both top and bottom line. Not able to give you a number to ink right now, but that will be coming as we get ready to give you guys our guidance and outlook for next year. Howard, would it be fair to say that we're looking at more to come as opposed to more already having been digested? Would that be fair? Yeah. In fact, very little has been seen thus far. We're viewing that as a tailwind going in the coming periods. Thank you. On pricing. [Crosstalk] Hey, how are you, Rodger? Yeah. No problem. Yeah, I mean, you know, as you know, we kicked off our commercial excellence initiative four-ish years ago. What we're seeing is continued really nice improvements from that. You know, focus on, you know, preparing our teams for large contract negotiations, really digging into all price change mechanisms, which certainly have helped us through the last couple of years of spiking inflation. Turning our attention now to share gain opportunities in some of our businesses. As Rob said earlier, with the tremendous performance of our team through the supply chain challenges the last two years, we're seeing numerous opportunities there. Strategic pricing will continue regardless of inflation and/or deflation. You know, that's been a pretty consistent contributor over the last three years, and we expect that to continue as we move into 2023. Yeah, Rodger, let me just add to that to reinforce that, you know, certainly we've got costs moving up and down, you know, all the time. What we're seeing and through these initiatives is recognition. COVID really helped with this, with supply chain interruptions and our ability to keep our customers running, is that you know, we are being recognized for our value through the margins. We always talk, and we do it as well, price, cost, price, cost. But we deserve a certain level of margin. Our customers are recognizing that. It's really about cost pass-through, or recovery. You know, our intentions are that the margins should be reflective of the value generation that we are providing the market. That's what Rodger’s talking about and our focus in that area. Okay. Howard, if I can get a quick one in, number 3, and I'll turn it over. In the past quarters this year, you've talked about even with the very tough comparisons, you know, because of metal and other factors, you still expected to grow earnings in 2023. Since we last spoke, you know, industrial's gotten tougher in terms of the outlook. FX has probably gotten tougher in terms of the outlook. Would you still expect to be growing earnings next year, or is that too tough to call at this juncture? Thanks, I'll turn it over. You know, Yes. Again, I'd say it's too close to call. We do have that headwind. I think if you look at next year, certainly first quarter, maybe even second quarter is gonna be very tough, comps because of that. You know, as we pull our budgets together, we'll look at how that materializes through the course of the year. What I'd say from a cash perspective and an EBITDA perspective, we are very bullish as we release the working capital from this year, that I would say this, I'd be rather disappointed that we weren't able to generate the type of EBITDA levels that we have this year. Thanks very much. Our next question comes from the line of Adam Josephson with KeyBanc Capital Markets. Your line is now open. Good morning, everyone. Thanks. Howard, I may wanna start paying closer attention to your accounts payable in the future, given this issue you're dealing with this morning. On to a more serious question. Rob, in terms of your price cost guidance for the year, I think in last quarter you mentioned you expected a $250 million-$300 million benefit. Year to date, you mentioned it's $254 million. Have you changed your expectation along those lines this year? Then, relatedly, your Sonoco Metal Packaging expectation for the year, I think last quarter was trending toward the $200 million range. Can you give us any update there? Yeah. We're seeing continued positive direction in terms of price cost as we go through the year. On the Metal Packaging side, I think you're right in that ballpark of the expectation for this year. Perfect. Yeah. Thanks, Howard. Adam, like Yeah. Adam, the way you should think about it is, you know, Q2 was $79, you know, Q3 was $90 in terms of positive price cost benefit. You know, the phasing of that as consumer has been relatively consistent and that industrials picked up as we've gotten, you know, the benefit of some strategic pricing, you know, offsetting declining OCC input prices. That trend, we expect, will continue through the fourth quarter, though there is, you know, some volume uncertainty in the fourth quarter, as we've said. I appreciate. How much of that, Rob, did you say you expected to in effect reverse in the first half of next year, specifically in Metalpack? Well, I mean, what we've disclosed is that there was $0.40-$0.45 of, you know, of what we're calling metal price overlap, and on an EPS basis in the first quarter of last year. We do expect that to not recur next year, which should, you know, overall, be a relatively meaningful headwind in the first half. Yep. No, perfect. In terms of the progression of volume trends, can you just help us with, you know, compared to the volume mix down 4%, how volume was by month and then into October, if you have such data? Yeah, Adam, I'll take a shot at that. I think that the trends are pretty similar as we went through the quarter into October. I mean, if you break down the 1.6% growth in overall consumer global paper cans was up 5%, pretty consistent through the quarter. As we've already said, this seems to be holding up, will hold up in the fourth quarter based on our guidance. Flexible is up 4%, still pretty consistent across the quarter. We look at similar for the fourth quarter. From a consumer standpoint, volumes seem to be holding up fine and with no, you know, real slowing as the quarter went along, if that's what you're asking. In industrial, we have seen some accelerated slowing. We talked about, you know, Rob talked about the 9.5% down for industrial. Remember now, number 10 is in this number. If you strip that out, you know, just take tube and core globally as an example, is down 6.5%, with highs in the mid-20s in Asia and down to -2.2% in U.S. and Canada. That gives you a feel. We have seen slowing that we've already talked about with our customers taking inventory out of the system by the end of the year in both our paper and our tube and core market. We have seen some accelerated slowing that is built into our guidance for the fourth quarter. I appreciate that. Howard, just one last one on the long-term EBITDA guidance you gave right around a year ago. I think if I take Metalpack out of that, you'd be basically. Well, that was pre-Ball Metalpack, but effectively, you're at that 2026 guidance already, aided by the price-cost benefits you've had this year. At what point would you think it necessary to update that 2026 guidance? Do you think that still applies? Any thoughts there, I would appreciate. Yeah, we're in process right now, Adam, of really relooking all of our longer term objectives. Obviously we've reached our five-year target in one year via acquisition. We're continuing per George's question, that walk of $180 million of self-help over the five-year period. We have not backed off on that at all. You should hear from us, you know, early next year and, you know, end of the first or early second quarter as we walk you guys through our next five-year horizon and objectives. Adam, I wanna go back to your comments about and question to both me and Rob as it related to the metal business. There's a couple things to note. One is we had 11 months this year, so we do have a month extra going into next year. You know, aerosols is an important part of that business, and we're actually forecasting, at this point in time, growth in aerosol next year. The previous buyers that owned that business, with the inflation coming into play last January or this past January, there was a big pre-buy program. We were very weak in aerosols in the first quarter, coupled with the optics we have on share expansion going into next year. There's some positive things to help offset what the headwind that we are waking up with from a price cost perspective. We'll just see how that all unfolds as we finish up our plans for next year. Thanks so much, Howard. Our next question comes from the line of Mark Wilde with BMO Capital Markets. Your line is now open. Hey, Mark. Thank you. Good morning, Howard. Good morning, Rob and Rodger. Morning. Rob, I wonder, just to start out, can you give us some sense for kind of benefit from just lower OCC and lower resin as we think about the third quarter and then what you're expecting in the fourth quarter? It sounds like OCC in the fourth quarter might be down, you know, $70-$80 a ton. Yeah. I mean, it's down more than that, actually. I mean, OCC, we averaged kind of $123. We started the third quarter in the $150 range. You know, we're probably below that, you know, RISI quote right now, you know, with some softness, you know, to go in the fourth quarter. OCC has had, you know, a historical decline in the last, you know, four months. You know, there's relatively little inventory in our system in terms of OCC. That's really kind of flowing through on a real-time basis. That has been a positive for price cost. You know, two-thirds of our price cost benefit in the third quarter was from the industrial business. We anticipate, you know, that trend to increase, you know, as, you know, we're steadfast in kind of providing value to our customers and, ensuring that, you know, our prices reflect that. We think fourth quarter should have some benefit there. We do, as I said, you know, are very mindful of the downtime we're expecting to take, which will be more than the third quarter and in the fourth quarter as a result of just market weakness as we bring the number 10 machine up. Okay. Second question, I'm just curious, you know, Rob, either from your side, or maybe Howard, from your side, we've got a new CFO, Rob. You've got a little different background than past CFOs that I've dealt with have had. You've also hired a new head of M&A. I'm just curious about, just broadly, how you think this is gonna change the capital allocation process at Sonoco, particularly around acquisitions. I mean, no change. We've always been really mindful of what the opportunities are out there. I think we've been really intentional, as Howard said, about really formulating a really forward-looking strategy and focusing on the core and what we really do well, and how we can drive value prospectively. I think now more than ever, we've really got, you know, the key list of things that we do really well that really add value in other businesses, where we're actually the better owner of those assets. I think that we're showing that in the Metal Packaging acquisition, how we've really kind of brought new energy to that business and to that industry. That's really the gist of the strategy from an M&A perspective. We're thinking a lot about what are the one, 5%-10% off current market that are really kind of additive. We do view that can business as just the can business, that they were completely adjacent and are additive to each other. We're constantly looking for other opportunities to add to the strategy. We're being really thoughtful about what we can do prospectively, and we've got the capabilities internally to really execute M&A at a really high level. Yeah, Mark, let me add, too. This does relate to acquisition. You know, the type of growth opportunities that we're seeing right now, particularly in our paper can business, tied to sustainability. The Can Packaging, again, it was hardly a notable. It was a EUR 40 million acquisition made on the eve of COVID. We're now able, as things have opened up, to take that technology and start leveraging it. We're seeing really tremendous opportunities from an organic perspective. Frankly, we're spending a lot of time now looking at our investment capital in terms of really we have to be cautious about how we deploy it. We have got so many global pent-up opportunities from an organic base. That's the kind of thing we're looking at. You know, I know the Skjern, and again, $50 million in sales of the complex, so what? Well, we're not in the lightweight business in Europe. It's 100% consumer-facing. We actually represent 15% of their volume in our own can business. So it gives us, as I said in my commentary, security of supply. But it gives us a forward look into other markets on the consumer side in Europe before we just weren't able to participate in, at least from a board perspective. Okay. All right. Last real quick one for me. Just as you talk about fewer and bigger businesses, can you help us with what that might mean for some of the joint ventures that you have going forward? You know, don't spend a whole lot of time contemplating those. We're in several, you know, some the partner is managing it, and we're certainly on the board and a part of the business. Others are more like a 50-50. You know, we don't really have that many that are that material. We don't spend a whole lot of time there. Okay. All right. Sounds good. Good luck in the fourth quarter and into next year. Thanks. Our next question comes from the line of Mark Weintraub with Seaport Research Partners. Your line is now open. Thank you. On the $180 million of self-help, which you're targeting over the next several years, and I realize this is a difficult question to parse. How much would you say is gonna be delivering on the cost type side of things versus how much might be more volume driven? And of that, what might be sort of more market dependent on having a good backdrop versus, you know, for instance, it sounds like with the number 10, maybe you're increasing addressable market a little bit as well with the new products that you have. Any color you could provide on those would be great. Yeah. I'm gonna let Rodger handle that, but I don't wanna leave that without noting that you know commentary about you know capital investment, growth opportunities, new products you know the war on plastics and our opportunity you know with a 90%-95% paper solution. All that is totally disconnected from this conversation around the $180. It's really a walk of several key areas that we're focusing on. Rodger. Yeah. I mean, if you remember, I think we were pretty specific about how we divided it into the categories. Let's say a quarter or so is commercial excellence, which we've already touched on. Really ramping up the look of commercial excellence beyond, you know, specific major customer negotiations and getting into other areas like deeply into price change mechanism, deeply into share gain, deeply into, you know, driving volume growth into some of these adjacent markets that we're talking about, so therefore opening up the opportunity for growth. Productivity is really a lot of this around the capital projects and capital planning that Howard's already talked about. In addition to growth focus, like the sustainability project he talked about, tremendous amount of energy saving type projects, productivity generating improvements, those are ongoing. You'll see, Rob talked about the capital spending for this year as it accelerates as we get into next year focused on the integrated business. From the cost side, we talked about some structural transformation work we're working on now as we set up these fewer, bigger businesses. We've taken the opportunity to consolidate some businesses into larger businesses within the integrated business, which leads to strictly cost out. Now, of course, there's offset through labor inflation that we've seen this year, but that's strictly cost out. Then supply management, supply chain, I think, is the biggest opportunity we see over the coming years as we really get into this integrated supply chain on our four integrated businesses and drive continued productivity on how we manage those businesses, how we manage data, giving our plants the best data on a daily basis to make the best decisions to drive productivity and serve our customers. That's more longer term and somewhat dependent on, you know, market forces and volume going forward. I think it's a pretty even split between cost and driving value through the businesses and through the markets and the opportunities in the markets. Okay. So for the second part, which would be more volume driven, it comes, but it may come more when the market is in a place to support it. Is that kind of a fair way to think about it? Yeah, I think so. I think, you know, if you think about, if you look at our productivity this year, you know, we're not the only one in this boat with having tough productivity results this year. Some of it's frankly just the better operating of our equipment as we're able to schedule out. Think about our global paper footprint. This year, we've had tremendous volume demands, which led to many changeovers and exactly how you do not wanna run major paper complexes. Managing that going forward based on volume demands will be very helpful. Great. As a second question, and this again, it's a tough one, but since everybody's I think wondering about it, I'll ask it and see what you feel comfortable sharing. The URB markets kind of historically have been, you know, sometimes volatile pricing. Things are good, prices go up. Things are not so good, prices go down. You've been working a lot on your commercial excellence. We're in this environment, though, where you've got wastepaper going lower, demand is weaker. As we're trying to figure out what's likely to happen in this market, is there anything that you would share as we do our prognostications and analysis? Yeah. I think Howard touched on it earlier. I mean, our focus is on margin and generating the value and getting the value that we're adding through our integrated products, including our URB, which we sell on the outside, and our integrated products like paper cans and tubes and cores. That's our focus. You know, we talked about what we're doing in the fourth quarter, adding more maintenance to offset some of the reduced demands. You know, look at the third quarter, excellent example of how we handled reduced volume. We had number 10 down for a good part of the quarter. We had soft volume in Asia and Europe. Look at our operating margin in the industrial segment for the third quarter. You know, we've managed that through strategic pricing. We've managed that through changing most of our contracts to Tan Bending Chip Index in the U.S. For me, it's about maintaining that margin going forward if OCC stays down, versus you know, continuing to drive positive price costs off of higher prices. I think the team's managed it extremely well. We're investing in our best paper assets, and Howard talked about, you know, and this was announced when we announced Project Horizon. We took number 1 and number 9 machines down at Hartsville, which were older, higher cost, less efficient machines. We're sticking with that strategy that we started four or five years ago, and so far, look at the third quarter, it's paying off. Great. Thanks. Appreciate the color. Our next question comes from the line of Gabe Hajde with Wells Fargo. Your line is now open. Good morning, Howard, Rob, Rodger. I wanted to dig in on, I guess it's your Q4 guidance, slide 13. You made a mention about lower food shipments. I guess I'm trying to understand what exactly that is. Maybe it's timing related in terms of when you ship some product. On the composite can side, I think you are investing in some new capacity there, and we're expecting kind of positive volumes. Elasticity has seemed to be, you know, I don't wanna say nonexistent, but consumers pretty resilient in terms of CPGs taking hefty price increases. Any feedback from your customers in terms of expectations kind of going forward as it relates to composite cans and snacking as such? No. Go ahead. Yeah. I was gonna just touch on the last part of that. You know, as I said earlier, we've got a tremendous funnel. You noted, yes, we're bringing new capacity on our paper can business here in the U.S and Brazil. We've got a new plant going into place, and that's just starting up now in Southeast Asia. We've got investments going in multiple locations in Europe. Around our foundational products, the more exciting is the can packaging type products that are 90%-95% paper. In Europe, where, you know, the funnel there is just phenomenal in terms of how many machines that we're going to have to build over the next period of time to service not only Europe, but other parts of the world. It is an impressive-looking runway to the point, I mean, we just looked at a capital review just for North America over a couple of years period that we're gonna be spending somewhere around $40 million in that business from a recapitalization standpoint, productivity standpoint, and growth standpoint. That's just in one area of the world. On that side of the business, just could not be, you know, more pleased with the amount of opportunity that we have. Yeah. A comment on slide 13 was really about sequentially fourth quarter versus the third quarter. I mean, seasonally, if you think about confection, you know, the holiday has been prepacked, Halloween's been prepacked, Christmas has been prepacked. Then the fresh fruit and vegetable business, the plastic clamshell business seasonally very low in the fourth quarter. As I said, given the seasonality, and Howard just mentioned, our paper can business, our flexible business should be solid. If the question is, are we seeing any reduced demands, our customers are not telling us that yet at this point. We expect, again, pretty solid demand in consumer outside of those very specific seasonally lower markets. Yeah. The only other thing I can point to is what there has been some choppiness in Europe, and that's not demand. It has to do with energy. You know, in the food industry, energy is a major component. We saw customers in September, October that were pushing out orders, waiting to see whether their particular market or country was gonna put caps in. You know, they didn't wanna put inventory on the floor that realizing that there was a fairly large reduction in the cost of energy just around the corner. Okay. No, that's super helpful. I guess on the Metal Packaging side, seems like we're navigating a couple different unique or discrete items. We had some pre-buy at the end of 2021 that impacted 2022. Sounds like you're making some organic investment for volumes, maybe picked up a customer there. I guess maybe going into 2023, all else equal, what I'm hearing is you'd expect aerosol to be up despite what might be a weak, you know, kind of economic backdrop for aerosol cans? Yes. That is what we're seeing. I've talked through that from a year-over-year perspective, the first half of this year was not good from a volume perspective just due to the amount of pre-buy activity the previous owner wanted to put in place, coming into the inflation. Yes, there's been value recognition. I would simply say that we have extremely good assets. It's a well-capitalized business, and we continue to put capital in it as well. You know, it's from an aerosol, which is the more sensitive side of the business as it relates to a slowdown, we see the opposite of what you normally would expect. One last one, if I may. I guess getting into both of Mark's questions on the industrial side of the house, as we think about, again, you know, it sounds like price cost is expected to be positive here in the fourth quarter, there are a lot of different influences that impact OCC prices. At least to the extent that OCC on a year-over-year basis is lower and we don't see any change in RISI indices, is there a reason why price cost would not be positive in the industrial business in the first half of 2023? Well, you know, at this point in time, we've got a lot of inflation. We spend a lot of time talking about OCC, but you know, all the chemicals, starch, diesel, labor, there is just a lot of inflation still out there. OCC obviously is the biggest driver of them all. Yeah, look, if it didn't, if the index didn't move that, I really don't know how to answer that. I'd say yes, probably we would be on a more positive side. We don't see any indications right now why the indices wouldn't move. All right. Great. Thank you, and good luck. Our next question comes from the line of Ghansham Panjabi with Baird. Your line is now open. Hi. Good morning, everyone, and thanks for taking my question. This is actually Matt Krueger sitting in for Ghansham. I wanted to take a step back and think about, you know, the potential EPS variances for next year. Using the midpoint of your guidance for 2022 as a starting point, can you talk about what the major EPS variances could look like heading into 2023? I'm just thinking about factors such as, you know, impact from higher interest rates, FX headwinds, you know, rollover acquisition contributions, synergy capture, productivity that you hinted at, you know, the metal impact from year-over-year. Just other big picture factors would be helpful. Yeah, I can tell you we're going through, you know, budgeting and planning as we have been for a while. I would say that this environment is really unique and that we're on the precipice of, you know, potentially having a recession, and we're very mindful of that and the impacts that has on demand. We're controlling the controllables. As Rodger said, we've got a really robust pipeline of productivity activities, and we're anticipating SG&A to be lower as a result of our structural activities. You know, we also do have kind of some known knowns, which is that the metal pricing overlap will not anniversary and the depreciation will be higher, and that the growth of those two is in excess of $100 million negative. Though we do feel like, as Howard said, there's consumer volume opportunity, and we're continuing to watch industrial demand and the availability of industrial price-cost. Got it. That's helpful. Just following up and maybe digging in on some of that, you know, consumer strength that you're referencing. Many of the CPG food and beverage customers are clearly employing a value over volume strategy currently to offset inflation in their own portfolios. You know, what are you experiencing from a consumer demand elasticity perspective as it relates to, you know, the massive level of pricing being passed through the supply chain? It sounds like you've been very resilient. Do you expect that this could be any sort of natural volume headwind into 2023? Any thoughts there would be really, really helpful. Well, yeah, we're really not seeing it right now. We participate purposefully in the past, you know, across the aisle, so from the store brand to the brand leader. Trade downs are not a negative to us at all. I think the other is, if you look particularly on the plastic side of the business, we continue to see good strength in our metal business from more workers at home, consuming at home. Matt, right now, Rodger, unless you have any additional color to add, but we're not feeling it on our end. There may be substitutions, but we benefit from that substitution as well, depending on the substrate. Yeah, that's right, Howard. Our customers are telling us their bigger challenge is the supply chain constraints of certain raw materials versus demand. I mean, GlobalFoundries chips is put out there by one of, you know, our largest customer in that market. They're, you know, they're producing and publicizing their volumes. Good growth there. Snacks, cookies, good growth there. We're not hearing it. We're hearing their biggest challenge is more getting materials to get the product on the shelf versus seeing any significant reduction in demand at this point. In fact, curtailing marketing because they don't want to stimulate more demand. Got it. That's helpful. That's it for me. Thank you. Our next question comes from the line of Kyle White with Deutsche Bank. Your line is now open. Hey, good morning. Thanks for squeezing me in here. On the core strategy of focusing on the core, if we go back 10 years ago, the 2014 Analyst Day, the company had this similar strategy of focusing on its core business and optimizing the portfolio. I think you had the blow molding divestiture around that time. Other than that, I don't recall too much more happening. Obviously the strategy focused to be more on growth later on. I guess what is different this time around versus 2014 or 10 years ago? Is there more of a focus to actually optimize the portfolio? And then what kind of implications does that have from a capital allocation or CapEx standpoint going forward? Yeah, you know, I think the easiest thing, the way to answer that is we've got a whole new leadership team, with a different vantage point on and a lot more work that we've put in on what is truly core. It really, Rob discussed it, but, you know, we've spent at least 18 months, you know, doing exactly what you're doing, going back 10 and 20 years and saying, you know, what is the journey that we've been on, and, you know, what have we learned from that? We woke up and, you know, we finished this analysis and said, "I'll tell you what we learned is that the foundational businesses of this company have really grown, driven the success that we've enjoyed for all these many years." Because you can't just look at 14 years ago, you can look at 5 years ago or again, 20 years ago and say, you know, look, are we on a self-fulfilling prophecy where we're, quote, "optimizing industrial businesses for cash" as opposed to, you know, acting as who we are, the market leader and global market leader in URB and tubes and cores. The case in point is Project Horizon. That's not an optimizing activity. That is saying that we're going to invest in these foundational business. I hate to keep saying it that way. They are going to continue to deliver strong value generations to come. It is different. There's been a heck of a lot more thought and processes that's gone into the journey that we're on. That's how we've landed where we've landed. You know, we've got our all other category, and we're managing those businesses as best we can, as best owners. We're seeing improvements in those businesses. We'll just see where that takes us going in the long term. Even equally important is if you go back, as you know, to 2014, we didn't structurally change how we managed the company. We are actually structuring the parenting of the company in such that the focus is only on the core. These other businesses, who are frankly burdened by centralized support in some areas, and that their markets that they serve require a totally different approach in that competitive landscape and that customer base. It's a different day and time, and this is not a repeat of anything that we've done and certainly in my tenure. Got it. That's helpful. I just had a real quick one. On Rigid Paper Containers, you know, that business continues to perform very well on volume growth. Can you just help us understand the divergence there as to why volumes are still very strong while metal food cans are seeing some declines? You know, both benefit from at-home consumption, and I would think they would be somewhat correlated. You know, I don't know if I caught the whole question. Yeah. I mean, metal food is, you know, a really mature defensive market that our business is growing along with the industry and the CMI kind of, you know, down a little bit this year. We anticipate that to kind of have, you know, really soft demand trends over the long run, you know, so, you know, around kind of GDP minus. But I think what we've seen is, and what Howard's been talking about with our Rigid Paper Containers business is, you know, just a real revitalization and a real focus on growth and opportunity there and having great customers as partners and really kind of identifying and going to the opportunities. We've got a great innovation funnel, as Howard said, with Can Packaging, and that's really driving a lot of this opportunity, along with just some really, you know, focused market participation that we've partnered on. Yeah. I'd say on the metal side, you know, the integration has gone extremely well. We have synergies on the commercial, and those are building. We will be announcing in January that we have four dedicated metal plants in Legacy Sonoco that will be folding in and being run by the metal experts, which will also drive additional synergies. I guess the most impressive for me is having the opportunity to be out in the market and the type of reception that we've received from the customer base has just been exceptional. We'll see how it plays out, but extremely encouraged about, you know, what the volume profile may look against a business that on a macro perspective is, as Rob said, GDP or slightly less. Got it. Thank you. Good luck in the quarter. Thanks. Our next question comes from the line of George Staphos with Bank of America. Your line is now open. Hey, guys. Thanks. Very quickly, I know it's late in the call. Rob, first off, do you have a view on what FX would be if we mark to market relative to your guidance for 2022 in terms of what the headwind could be for 2023? Second, there have been a couple questions around this. You know, bottom line, do you expect or what do you expect your consumer volumes to look like fourth quarter year-over-year versus fourth quarter? Then lastly, Skjern, is there a way to size what benefit to earnings you'll get from having that business? Thanks, guys. Good luck in the quarter. Yeah. We're still evaluating FX. I mean, we don't take a position versus where it currently is. If you just held it where it currently is, you would anticipate that next year would be a, you know, a mild headwind. Okay. You know, on Skjern, and then I can pass off on consumer volumes. Skjern, we, you know, that is. You know, we are anticipating that to be an accretive acquisition. For the size that it was, it was a really, you know, a beneficial transaction. It's gonna be, you know, high single digits accretive on a full year basis, and we anticipate that to close in the fourth quarter, so we'll get the full benefit in 2023 with some synergies on top of that. George, I think on the consumer volume fourth quarter, we said it. We expect similar volumes in Rigid Paper Containers globally and flexibles, and then we're gonna see weakness in our resin-based businesses due to the fresh food seasonality being down. You know, we finished it, you know, 1.6% up for the segment in the third quarter, so I'd expect it to be down slightly from there. Thank you, Rodger. Good luck in the quarter, guys. That concludes today's question and answer session. I'd like to turn the call back to Lisa Weeks for closing remarks. Thank you again for joining our call today, and thank you for your interest in Sonoco. We had published a press release earlier that indicates all of our conference activity in the fourth quarter. We definitely hope to see you there. If you do have any don't hesitate to reach out, and we hope that all of you enjoy the rest of your day. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.