Good day. Thank you for standing by. Welcome to the first quarter 2023 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 this session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. 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 of Investor Relations. Please go ahead. Thank you, operator, and thanks to everyone for joining us today for Sonoco's first quarter 2023 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 first 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. 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. 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 web. After management's prepared remarks, we will host a Q&A session. If you will please turn to slide four in our presentation, I will now turn the call over to our CEO, Howard Coker. Thank you, Lisa, and thanks to all of you for joining us today. As our first quarter results show, we've had a good start to the year. I'll let Rob cover the detailed financial results, but our commercial excellence programs and improving productivity have underpinned what we consider a strong Q1 performance. As I mentioned before, we are not immune to the secular headwinds around our customers and the economy in general. This demonstrates our better portfolio management and business mix provides less volatile results than in previous business cycles. We have a backlog of growth and efficiency investments that are material to future earnings. While we navigate near term macro volatility, we're going to invest in the businesses and place our investments on projects with the highest returns for our shareholders. I would like to say to our Sonoco employees and our operations within our sales and engineering teams and all those that support the business around the world, thank you for what you do and thank you for supporting our customers, Sonoco, and your focus on execution day in and day out. Before Rob takes you through the financial results and guidance, please turn to slide 5. I wanna highlight, we released our updated Corporate Responsibility Report last week and provided a QR code in this presentation that you can scan to directly download the document. Sonoco report quarterly to our senior leadership team and our board on the ESG commitments we're making, including those highlighted in our refreshed document. We're excited to release our first report in reference to GRI, TCFD, and SASB standards and report progress to 2030 in line with the science-based target initiatives. On the social side, we have updated our workplace diversity hiring progress as well as updates on our supplier diversity and spending programs. Lastly, we have many R&D efforts centered on developing new and innovative products to meet the sustainability goals of our customers. We are tremendously proud of our capabilities and the work on this front. With that, I'm gonna turn it over to Rob to walk us through the quarter and the financials. Thanks, Howard. I'll begin on slide 7 with a review of key financial results for the first quarter. Please note that all results discussed are adjusted, and all growth metrics are on a year-over-year basis unless otherwise stated. The GAAP and non-GAAP EPS reconciliation is in the appendix of this presentation, as well as in the press release. First quarter financial results again reflect Sonoco's ability to deliver solid performance through strategic pricing and operational excellence despite uneven end market conditions. Sales were down 2% to $1.73 billion in the first quarter. Sales for the quarter were in our expected range despite supply chain variability continuing to impact month-to-month volume ends. January sales were stronger than planned, and March sales were weaker than planned. We do not believe that this reflects a trend, and we anticipate sequential sales growth in Q2, just as we achieved sequential sales growth in Q1. Operating profit was $213 million, and operating profit margin was 12.3%. Likewise, EBITDA was $276 million, and EBITDA margin was 16%. This level of profitability was anticipated as we experienced negative $86 million of expected metal price overlap in the period. Excluding the impact of metal, EBITDA increased, and EBITDA margin increased. Results exceeded our initial guidance as we continue to execute our operating model to achieve price and productivity despite uneven end market conditions. Next, we have the sales and operating profit bridges on slide 8. On the sales bridge, volume mix was negative $116 million, or negative 6.5%. Volume mix was driven by low industrial volumes, but benefiting from acquisitions. The current integration is progressing as planned, and Q1 included an additional partial month of metal packaging. Price was $98 million positive, up 5.5%. Price continues to reflect the efforts of our commercial excellence strategy, namely selling the value and managing contracts to recover inflation. Next, the operating profit bridge. Volume mix was negative $40 million as low volumes impacted standard margin performance. Price cost was negative $22 million as negative price cost in metal packaging offset positive price cost in paper containers and industrial. Industrial price cost was positive $44 million due to continued benefits of moving to index-based pricing and historically low OCC. OCC averaged $35 per ton in Q1 2023 versus $160 per ton in Q1 2022, and $38 per ton in Q4 2022. Productivity was meaningfully improved at $20 million as we continue to execute our disciplined operating model. We've built a strong basis for meaningful productivity once volumes normalize. Slide 9 has an overview of our segment performance for the quarter. Consumer sales grew 5% to $909 million due to acquisitions and strong price performance. Sales increased 3% sequentially. Elevated customer inventory and normalizing supply chains continue to interrupt volumes across the consumer businesses. Our near-term volume outlook is less positive than it was at the beginning of the year. Consumer volumes declined 1%, including acquisitions and divestitures. Volumes and flexibles and paper containers were essentially flat. Metal packaging can volumes were down as food growth in food was offset by low aerosol volumes due to high customer inventory levels. Consumer operating profit was $92 million as flexibles achieved its second-best quarter in history. Paper containers continued to achieve strong operating profit and margins. Industrial sales declined 12% to $616 million as lower volumes offset higher prices. Industrial volumes were down 13%. Volumes remained lowest in Europe and Asia. US volumes were lower due to increased maintenance and lack of business downtime, as well as the impact of exiting the corrugated medium market and divestitures. It's important to note that industrial sales grew sequentially based on higher sequential volumes. Industrial operating profit grew 30% to $94 million as price cost offset lower utilization. Operating profit margin increased 490 basis points to 15.3% commercial excellence efforts. All other operating profit increased 88% to $27 million due to strong price costs and productivity. All Weather is a notable example of the results of our disciplined operating model as we continue to operate these important businesses for optimal results. These results continue to indicate that our operating model is working. Margins are up across all but a few of our businesses. We're focused on achieving appropriate prices for our value-added products and de-emphasizing or exiting commodities markets like the recently exited corrugated medium market. We're investing in the business and controlling costs, and expect meaningful productivity once volumes normalize. Moving to slide 10. Our capital allocation framework is aligned with our business strategy to drive value creation for our shareholders. Our priority is to allocate capital to high return investments in our core businesses to drive growth and improve efficiency. From a free cash flow perspective, we remain focused on increasing the dividend, which will increase 4% to $0.51 per share on a quarterly basis, or a greater than 3% annualized yield based on the current share price. After capital investments in the dividend, we prioritize investments in strategic M&A and maintaining our investment-grade credit rating. For the quarter, operating cash flow was $98 million, and purchase of property, plant, and equipment was $83 million. Note that the proceeds from asset sales, capital investments were $12 million. On slide 11, we have our Q2 2023 guidance. In Q1, we beat our initial EPS guidance and achieved the top end of the revised range. For Q2, our EPS guidance is $1.45-$1.55. We have tight control over our businesses, and they are running well. This guidance includes $26 million of negative year-over-year metal price overlap and continued low volumes in industrial in Q2. We're raising our full year 2023 EPS guidance to $5.70-$6.00. We're cautiously optimistic about the remainder of the year, and we are managing our businesses with agility. We are affirming our EBITDA guidance of $1.1 billion-$1.15 billion. Likewise, we are affirming our operating cash flow guidance of $925 million-$975 million. We anticipate continued benefits from network and capital management throughout 2023. Now Roger will discuss the outlook on a segment basis. Thanks, Rob. Please turn to slide 13 for our view on segment performance drivers for the second quarter of 2023. Across consumer for the second quarter of 2023, we expect sequential volume growth across the segment, including metal cans. We see increasing demand for sustainable packaging solutions and new products. We're closely monitoring any potential softening based on consumer spending. In Q2, as Rob noted, we'll work through the remaining inventory impacted by metal price overlap. Beyond this year, we're continuing to invest capital to expand capacity for sustainable packaging in 2024 and beyond. In our industrial segment, we see continued softness in volumes globally in our converting and trade paper sales in the second quarter. We're monitoring Europe and Asia demand recovery carefully, as that will be critical to the overall volume outlook for the full year. Thus far, we have yet to see any significant improvements, which is reflected in our forecast. Demand remains soft in our core industrial markets and in protective packaging for the consumer white goods market. We model price cost benefits to moderate as we progress through the year in the industrial segment, but still expect full-year price cost to be positive. While some inflationary impacts are lessening, labor and related costs continue to increase. In our global uncoated recycled paper mill operations in the second quarter, we will maintain reasonable backhaul levels by region. In North America for the second quarter, there is no planned lack of business downtime, with normal levels of scheduled maintenance downtime similar to the first quarter as we've seen the North American URB network supply and demand stabilize in the last month. We will continue to take periodic lack of business downtime in Europe and Asia at similar levels to the first quarter until demand improves. In our other businesses, we continue to have net stable volume demand across this collection of businesses. With improving productivity and favorable pricing actions, we expect continued increases in profitability this year. Overall, we've had a good start to productivity in the consumer and all other businesses. We expect to see the benefits in industrials when volume growth returns. We're seeing the positive impact of our increased capital spending in the last few years focused on productivity and a fairly significant easing of supply chain constraints on our materials and labor. With improvements across the breadth of our excellence programs and just really executing well, we're continuing to build resiliency in our operating model. With that, back to you, Howard. Okay. Thank you, Rodger. If you would, Torrance, to slide 14. You know, I want to end our discussion as we look ahead to 2023 and beyond. You know, first, Sonoco is a global leader in high-value sustainable packaging. Our funnel of packaging solution designs provides Sonoco with a long runway of growth opportunities across our businesses. We are continuing to transform this great company through portfolio management and strategic M&A. We have spent the last 18 months and beyond working on structural transformation to solidify our base. In the future, you're going to see increased efforts to further focus the portfolio. We will exit some business and expand others, all with the right timing to maximize value. We will keep you informed, obviously, as we progress through this journey. We're in the early stages of leveraging our operating model to expand margins. Our operating model is solid, it's sound. Through our excellence programs, footprint optimizations, enterprise standardization, how we operate the business will only get better through time and is reflective of our solid performance in uncertain times as we live in today. As Rob covered very well earlier, we remain disciplined in capital allocation. We expect to continue investments to grow. Lastly, and importantly, we are committed to improving the lives of our team members, our customers, and the communities in which we live and work. Our recent CRR report only scratches the surface of the great things happening within Sonoco to fulfill these commitments. We look forward to keeping you informed along the way of all the improvements we're undertaking. With that, operator, we are pleased to open up to questions. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile our Q&A roster. Our first question comes from the line of Ghansham Panjabi with Baird. Your line is open. Please go ahead. Yeah. Thank you. Good morning, everybody. I guess first off, could you just give us some more granularity on the first quarter volumes across the various consumer verticals? If you covered some of this, I apologize. We had some audio issues on our end during the prepared comments. Yeah, we can talk about the different consumer verticals in Q1. You know, from a volume perspective or from an OP perspective? Volume would be helpful. Yeah. From the volume perspective, you know, I think the primary trend we saw was, you know, a strong start and a soft finish to the quarter. Really when you think about flexibles and rigid paper containers, those both had, you know, really good quarters, but ended up relatively flat, with kind of a uncertain trend for the rest of the year. Metal was down slightly, really due to weakness in aerosol. Those were the primary drivers there. Got you. In terms of productivity, you know, you hit the first quarter was around $20 million+. How should we think about the rest of 2023? Also on price cost, you said you expected the full year to be positive. Just expand on that in terms of sequencing for the full year. Thanks. Yeah. On productivity, got you. It's Rodger. I think you should expect pretty similar levels by quarter. As I said, we're seeing supply chain constraints ease up, labor ease up to some degree, the team executing extremely well on the capital that we put in place over the last few years focused on productivity, footprint optimization, as Howard's already mentioned, supply chain team working extremely well with the businesses. I think you should see similar levels going forward for today. On price cost? Yeah. On price cost, I'd say, for the balance of the year, we probably started the year a little bit pessimistic on where we would end up in price cost, and we've seen pretty good performance and pretty good results from, you know, how input costs and our ability to get price off those input costs and recover inflation has come out. That's one of the reasons for some of the upside in the forecast. Got it. Thanks so much. Thank you, and one moment for our next question. Our next question comes from the line of Anthony Pettinari with Citi. Your line is open. Please go ahead. Good morning. I was wondering if you could talk a little bit more about maybe customer inventory positions, maybe starting with consumer. You know, where are we in sort of destocking cycle in, you know, metal, composite food cans, maybe versus aerosol versus flexibles? On the industrial side, are there any sort of trends you'd flag, you know, in North America versus rest of world in terms of, you know, customer inventories in that destocking cycle and where we are? Sure. Anthony, this is Howard. you know, as Rob said, and we noted, when we updated our guidance, mid to the end of the first quarter. When we came out in January, it really fell through in terms of the destocking activities on the consumer side, particularly in our legacy businesses. We came out of the blocks really strong January, early February. I don't think it's unique to Sonoco. We started seeing tapering off with the banking crisis, other uncertainties in the macro environment. We did see some backing down there. I would suggest to you that on our legacy side of the business that, you know, there's still question marks in terms of the full value chain from retailer to supplier of folks like us, basic raw materials. Not of a concern as what we had first expected and how we came out of the blocks. On the metal side, you know, the results are relatively consistent with what you've heard from others as well as CMI, with up on the food can side, down on the aerosol side. In our case, we've got a couple of customers that the destocking activities are extended longer than they and/or we expected. We're looking at secular improvements, quarter to quarter and getting assurances that they should be working through their situations, let's call it through the mid to the end of this year. Unique one-off situation on the aerosol side and we'll just have to ride that out. Yeah. Anthony, on industrial, Rodger, you know, we modeled in a mid-single digit continued decline in industrial volumes in Q2, and that's really driven by Europe and Asia, this continued weakness there. Some one-offs, the textile business out of Turkey with the impact of the earthquake has a pretty significant impact. As I said earlier, the North American market we've seen stabilize. We're not modeling any growth there, but we've seen it stabilize over the last month, and that's what we're expecting for the second quarter. Really the watch-out is Europe and Asia as far as the second half of the year. Yeah. Anthony Pettinari, I'd say, you know, you know, going back to my prepared remarks and to this team and frankly the activities we've undertaken over the last, I said 18 months, but two, three years in terms of transforming how we manage the day-to-day of the business, the operation side. I just cannot be prouder of a relatively weak volume scenarios and posting the type of productivity numbers that we're posting. I tell you, it just gives me a nice warm feeling that volume as it will return over time, that we're in a extremely solid position to leverage that productivity in a more material way. So I guess thanks to Roger and the team and what they're doing on the operations side and others. Okay. That's very helpful. Maybe just one follow-up on productivity. You know, all other, obviously a smaller part of the business, but the margins there were quite strong in the quarter, certainly versus historical levels. I'm just wondering if you could talk about maybe some of the internal improvements you've made in those businesses, maybe the sustainability of that kind of margin, and just how you're thinking about that segment strategically. You know, you know, to start with Anthony Pettinari, it's kind of a poster child for the entire company. If we go back a year or two ago when we restructured not only how we report out from a segment perspective, but how we manage the businesses. As you recall, we created in the All Other Category, a more entrepreneurial type environment, allowing them to operate within the guidelines of the business, unique businesses that they support. From that, we're seeing the results. Again, it, you know, pockets and across the rest of the company, similarly, you're seeing. How we're looking at it for the long term, you know, these are good businesses, many of which are one or number 2 in their market segments. We're going to continue to operate them to their full capability and continue to drive through while they operate independent. We're still driving through the productivity and other transformational type programs that we have in place for them. They're really set up well to show you and a snapshot of what we're seeing across the company. We'll be evaluating businesses over time. I think I did mention it in my prepared remarks that when time is right for some businesses that may belong better off with others. You know, from an acquisition perspective, we see the inverse of that as well. We'll, we'll keep you posted. We'll let you know. The intent right now is we're gonna run these businesses, to their, to the best they can possibly perform to deliver the amount of value that our shareholders expect. They're very resonant, as you know, Anthony, and they manage price cost extremely well in the first quarter, and we'll do the same in the second. Okay. That's very helpful. I'll turn it over. One moment for our next question. Our next question comes from the line of George Staphos with Bank of America Securities. Your line is open. Please go ahead. Thanks a lot. Hi, everyone. Good morning. Thanks for the details. I guess the first question I had, if you'd already mentioned it, I apologize, but can you provide the lack of order downtime by region in the first quarter? I can, George. Roger. About right at 10% in North America, closer to 20 in Europe, pushing 25 in Asia, pretty significant. Okay. If you, Roger, if you could help us, just in terms of tons, what would that look like? I mean, we can go back into it, but just, you know, while I have you quickly. total- If you don't have it, go ahead. Yeah. Yeah. Total tons across the system, about, 7,000. Okay. I don't really have it. I don't have it by region, George. That's fine. Perfect. Perfect. I guess the next question I had. You're right, other companies saw a deceleration as the quarter went on, and March was in some ways year-over-year weaker, for many companies, than was the beginning of the quarter. Given the number of consumer companies you talk to, the breadth of your product line, and therefore the input that you get back, in a couple senses, you know, not, you know, solving for world peace here. What do you think happened? Because your businesses are relatively stable. Going into the quarter, I think you're looking for mid-single growth in food cans. I think pretty similar growth in flexibles. Volumes don't swing around that much. What you're hearing from your customers, what happened to the consumer that they went into the bunker to such a degree? Maybe it's just that, but what are your thoughts there? Yeah, George, it's Rodger. From our large consumers, I mean, you can see in their results they're taking significant price in the marketplace. Yeah. Some of our customers' products are very, are price sensitive. I think you're seeing that start to impact some of their volumes, or it did at the end of the first quarter. You see the major big box guys starting to push back hard on price. As we said, our food can, metal food can business was up 5%, so that came in about where we expected. Okay. The other, yeah, maybe the other supply was some of the inventory and some of our other customers, the supply chain challenges they've had, and they've just built up more inventory than we expected coming into the end of the first quarter. George, and I know you don't want warranties, and I will not give you warranties. What I will say is that, you know, we are staying conservative with our outlook. Okay. In terms of volume recovery. you know, we're really looking at seasonal increases quarter-over-quarter on most of the consumer side of the business, including the metal side. Yeah. Then in industrial, we're saying, "Look, we're not expecting any recovery, you know, through the period. It sounds like you're being very sort of consistent, very, basically assuming very little sequential improvement. What do you have? I think, Rodger, you said you're looking for mid-single digit declines, correct me if I'm wrong, on industrial in two Q. What do you have dialed in across the big categories for two Q and for the year on a volume basis embedded in your guidance? In consumer, up high single digits sequentially in the second quarter over first. All other, you know, you'll, again, I think similar volumes going into the second quarter, but similar levels. Okay. Profit. For the most part, we're saying across the categories, we're seeing sequential recovery. Exactly. Yeah. Again, if it's seasonal, part of it is certainly that. Okay, thanks. I will turn it over. Thank you, guys. Thank you. One moment for our next question. Our next question comes from the line of Mark Weintraub with Seaport Research Partners. Your line is open. Please go ahead. Thank you. Just one question. I am not sure I heard it exactly right. What? You said something on the metal price overlap. I thought you said it was a negative. You are thinking of it as a negative $26 for this year or last year. I am suspecting I misheard you. Could you just clarify that? Yeah. The metal price overlap this year was -$86 in Q1. 86? Okay. 86. Yeah. All right. We still anticipate that for the full year, it'll be slightly more than what we had originally expected, so more than $100. Okay. Thanks. as you look into there is carryover when but we expect to have completely worked through this to net to the end of the second quarter. Thank you. That makes a lot more sense than what I thought I heard, which was wrong. The second, again, I'm just trying to understand a little bit. I think you said that you don't see any lack of order downtime in your North American industrials business kind of going forward, which I guess seems surprising to me given the reduction in demand that we have seen and you weren't talking about it getting a lot stronger. Can you sort of just help me piece that together? Yeah. If you think about the across the system, and the URB system in the first quarter, I think the AFPA published numbers came out, you know, capacity utilization was something like 80%. There was pretty significant downtime across the market in the first quarter. I think that worked out some of the high inventories. As I said earlier in my opening comments, at this point for the North American market, URB market, we don't expect micro business downtime in the second quarter. The market has stabilized. Volume's not, significantly improving, but it's stabilized. It's not falling, we feel like that'll hold for the quarter. Okay. Is it fair to think that the level of downtime taken in the first quarter essentially overshot you to a point where even with demand a little bit weaker, there's a bit of cushion? Then, you know, hopefully we get a little bit stronger demand in the latter part of the year, and if that's the case, then we're in good shape, and otherwise we potentially have some more lack of order downtime later in the year. Is that a reasonable way to think of it? Well, I think if you think about the volumes on a year-over-year basis, you know, there is a reduction in volume on URB side associated with the conversion of number ten and the remainder of the Project Horizon activities. That's actually led to our mill system being kind of appropriately sized for the market right now, which we feel good about. Got it. Lastly, just to come back to kind of questions coming up a few times. I think you had suggested you thought consumer volumes this year could be up as much as 4%- 5% last quarter. Recognizing it's gotten murkier, there's lots of uncertainty, and you've talked about the consumer pulling back. Do you have kind of a perspective on what you think that number for 2023 year-over-year built into your guidance might look like? I assume it's lower than that 4%- 5%. Is that fair? That is fair, Mark. You know, again, as we came out of the year, it was pretty impressive with what we were seeing. That has certainly slowed down. We're moderating our expectations for the full year. We do think it will be slightly up on the consumer side by the time it's all said and done. Gosh, you know, I guess we missed it in terms of the exuberance that we were feeling as we entered the year with that in single days. I'm just gonna keep going back and pointing towards the execution side of the business and being able to not only type of environment. Great. Thank you for the color. Thank you. One moment for our next question. Our next question is going to come from the line of Kyle White with Deutsche Bank. Please go ahead. Hey, good morning. Thanks for taking the questions. I wanted to follow up a little bit on that last question, also just broader, looking at your full year outlook. Can you just talk about some of the moving parts considering 1Q from an earnings standpoint was a bit above your initial expectations, yet you're maintaining the EBITDA range for the full year? Is that just driven by, you know, the mercury and the softness in terms of the volume backdrop that we're seeing right now? Was it also driven by maybe, you know, tandem and chip prices being a little bit weaker than what was initially assumed? Maybe just any details you can provide there would be helpful. Yeah. I think that the biggest driver there was really the range and the mechanics of it all. We feel really good about where the EBITDA range is, you know, and it's $50 million. I think you can read into kind of where the guide is in terms of where we think we're gonna be in that range. The, you know, the volume mix as we think about it, you know, productivity was really an offset in the early part of the year, and we feel good about how productivity and we have built in some margin compression in, for over a quarter in the industrial business for the balance of the year in our guidance. Got it. If I could follow up on that, I assume you're keeping current list prices for can bending chips in North America. Is that fair assumption in the guidance? Yeah, that's fair. We're also assuming, let's call it a $15-$20 increase in the average FCC price between now and the end of the year. There are some cost increases coming in, but we left-hand bending chips flat for the year. Got it. That's helpful. For my second question, you know, there's a lot of weather events this past quarter. Just curious if that had any impact on your fresh fruit packaging business. Also if there's any anticipated impacts for the pack harvest related to it. Yeah. Kyle, we certainly felt it in the berry trade business, which is, as you'll note, is California, and, you know, that season's really coming off in that late winter, January timeframe, strawberries, et cetera. Then, of course, we have the frost activity down in Florida. Certainly reflective in to some extent in the performance of that business, that one business in the first quarter. I think we're working through that as we as we move forward. On the metal side, our, you know, our focus in the bean, tomato markets are really in the Midwest and where we have not seen the type of environmental issues as you see on the West Coast. Our customers are telling us business as usual as it relates to that side of the business. Got it. That's helpful. I'll turn it over. Thanks. Thank you. One moment for our next question. Our next question is going to come from the line of Cleveland Rueckert with UBS. Your line is open. Please go ahead. Hey, good morning, everybody. Thanks for taking my questions. Just a couple follow-ups from me because I think a lot of the big key points have been addressed. You know, I just wanted to dig in a little bit more specifically on the volume decline you're talking about. You know, I think we've talked a couple of times about industrial volumes being weak. They're stabilizing at a low level, but not really quite growing yet. Is that pretty much entirely coming from the container board industry, or is it that a sort of a more broad comment across other end markets? Yeah. Cleve, that's broad. It's broad. It's across all markets, textiles, especially weak, really in most every region, globally. Film also down, as you said, container board down. It's really across the board. Specialty, anything housing related was down fairly significantly. It was broad-based across all four of the categories that we track. Yeah. Okay. It sounds like you're getting some confidence that orders are starting to pick back up. At least from a, you know, from a volume from like tons produced standpoint, you're confident that Q1 was the trough. In fact, we modeled in some continued modest declines in the second quarter, driven by weakness in Europe and Asia. That's the, that's what we have in the guidance at this point. Yeah. Yeah. I'm sorry. North America is starting to firm. Yeah, relatively flat quarter to quarter. Yeah. Just quickly on that. In terms of the variability in the outlook, you know, just the kinds of things that we should track through the balance of the year as we think about, you know, skewing towards the top or the bottom end of the guidance. It sounds like really the European and Asian regions are where, you know, there's just some more question marks about how the second half is gonna materialize. Is that? For industrials. Yeah, for industrials specifically. That's correct. Yeah. Yeah. Yeah. I would just point out, you know, probably more Europe than Asia is really in total, including consumer, is only about 2% of our turnover. Right. Got it. Got it. It was a nice set of results for the quarter. Thanks. That's not going unnoticed. Thanks, everybody. I'll turn it over. Get kicked off and Cleve is your line. Yeah. No, I'll talk to you guys later. Thanks. Thank you. One moment for our next question. Our next question comes from the line of Gabriel Hajde with Wells Fargo Securities. Your line is open. Please go ahead. Good morning, guys. Good morning. I just, I find it interesting that, you know, I feel like maybe some of your customers are probably maybe window dressing for balance sheets coming into the end of the specific quarters. Because if memory serves, December was a pretty bad month on the consumer side, and then January snapped back, and we kinda had a similar experience in March. I'm curious if you could comment at all about sort of how April is trending. I think you said, Howard, that you're expecting sort of a normal seasonal sequential step up in the food can business, maybe some moderation and destocking in the aerosol side, then just maybe the legacy consumer business. Maybe as we think about monitoring, the quarters and the rest of the year as it progresses. Maybe paying more attention to what your customers are saying in terms of maybe modulating their own purchases and responding to consumer behavior. I mean, is that sort of the wild card or the factor that we should be most mindful of? Or, or is there something else going on? Yeah. You know, Gabe, I would say, it's certainly way too soon to say is this a new, a new operating environment and trend, from our customer's perspective. It's probably... I'd like to think it is related to really what's going on in the macro world. You know, I noted, and we all noted, there was a lot of question marks entering March with what was going on in the banking world and sector, and how does that kind of, reverberate through, the global economies. Can I hang my hat on that? Is that, is that, the decline that we saw? Certainly in December, the expectation was just that they were trying to draw inventories down to complete the year. Quarter to quarter, I don't think we're seeing a new phenomena here that's sustainable. You may see it in December, which we all do in December, try to pull back on our working capital as much as possible. You know, Talk about, you know, improvements going into the second quarter on the consumer side, you know, from the base that we're at right now, and from a sequential perspective. Yes, I mean, it's just natural that, or I should say historical, that we see elements of summer buildups in the spring as well as you noted on, and I noted on the can side of the business in terms of tax season, et cetera. Don't see a pattern here at this point in time subject to change, but I think it has to do with what's going on around the world and reactions and the timing of those reactions as it impacted us in March. Okay. Getting back to this all other segment and the enhanced profitability. Is there any way to maybe frame up for us, yeah, sequentially and then maybe the segment overall? I mean, should we kind of expect this level of profitability to persist sort of on a either absolute dollar basis or a margin perspective? Or was there something unique to the first quarter, you know, more sales of reels or something like that maybe swung things around a little bit more? Yeah. Gabe, this is Rob. Hey, that's a good question. Those businesses, you know, as Howard said, I mean, we have kind of really changed the operating model and really both challenged them, but given them a lot of freedom to operate. What they've done is they've been really entrepreneurial and are generating really great results as a result. Those aren't one-off or specific results that across the board, you know, down the line of those businesses, what we're seeing is operating improvement that's really generated by really tight cost controls, investment in productivity, and very disciplined investment in growth where they see it. Those levels of profitability are sustainable. Frankly, there's a couple businesses that have yet to really catch on, and we're excited to when those businesses start performing as well. Okay. One last one as it relates to the guidance. I mean, I think you guys kind of widened the range a little bit, which, you know, I maybe understand. Following a Q1 beat just feels a little odd. The one thing that jumped out at me, interest expense was tracking a little bit higher, I think you guys guided us $115 million. Has that assumption hanged? Maybe just sort of the rationale or the thought process behind the wider range versus what yo u had before. Yeah. Interest expense has trended higher, so has kind of all other expenses in that category, and it's really just related to how we budgeted the year. You know, it looks like, you know, maybe we'll see some recovery in variable interest rates by the end of the year, but we certainly budgeted it flat, you know, with the raise and have, you know, a fair amount of variable rate debt. That's what's really flowing through there. Also kind of modeling in, you know, how, what we think we're gonna do with the balance sheet for the balance of the year. You know, with regards to the range and moving it up, I think where we were thinking really was as we evaluated the risks and opportunities, we felt really comfortable as we were leaving Q1, that we had identified a lot of opportunities, but there was still a bit of uncertainty in the operating environment. We wanted to make sure that that was a wide enough range that, you know, we could, we could achieve it. That's why we really kept the EBITDA range where it was as well, because we feel really confident that, our expectation for the year is narrowing in on that range. Okay. Thank you. Thank you. Again, if you would like to ask a question at this time, please press star one one on your touchtone telephone. One moment for our next question. Our next question is a follow-up question from the line of George Staphos with Bank of America Securities. Your line is open. Please go ahead. Thanks very much. Hi, guys. Thanks for taking the follow-ons. Two questions from me. One, to the extent that you can comment, and again, if you'd mentioned this, apologies that I missed it. One, price cost for the year, where does that currently stand in terms of your expectation for 2023 relative to what you would have had coming into the year and/or your last guide? What was the positive variance here, which seems to offset the volume uncertainty that you have, understandably. Similarly, on productivity, where's productivity? Where's operations? If there's a way to quantify to some degree now for the year relative to where you would have been entering the year, again, you know, which helps to offset sort of the volume uncertainty. The second question I had is just in terms of volume, and I think, you'd mentioned that you expect consumer to be up modestly this year. You know, recognizing there are no guarantees in life, is there a level of volume degradation that would, you know, begin to undercut, especially the low end of your guidance range? Instead of low, you know, very low single digit, if you put up a -2 or -3 at the end of the year, does that risk your guidance? How would you have us think about those sorts of questions? Thanks, guys, and good luck in the quarter. Hey, George. Yeah. As we think about the year and kind of where we've landed and what the bridge is, you know, we really do think that, you know, the positives are really gonna be productivity and then a little bit of volume positive here and there. Mm-hmm. The price cost was, you know, the big driver for the performance in Q1. It'll be a big driver throughout the year, really overcoming the metal price overlap with a lot of really strong performance across the broader business. I'd say metal price overlap is coming in higher than we had anticipated, so that's just a greater headwind than we had anticipated. Yeah. We're seeing pockets of strength. Overall, I think price cost will probably be weaker than what we had anticipated. Weaker. Okay. Productivity then, if you had a ballpark what that's adding to you relative to your prior expectation? George, and this is Rodger. In our original plan for 2023, we had ramped up productivity throughout the year, expecting it to take more time for some of these capital projects and supply chain challenges to ease. First quarter was probably twice what we expected. Okay. As we think about the next several quarters, you know, we're pretty optimistic that we'll be at plan or maybe even slightly above that. Okay. Then just on the volume question, again, no guarantees, but is there a level... Certainly, there is. What level would you say if you're seeing, you know, X amount of volume degradation where we start to, you know, you'd start to worry about your guidance factors? Thank you. Yeah. George, you're right. That's a tough one to, to really get a handle on. What I would say is that, I think what we've modeled out is what we believe to be true, on the lower side, let's put it that way, through the course of the remainder of the year. If you think of, you know, the question is more about what is the negative implication. What I would say is that we have, and, you know, history does not necessarily, predict the future, but during, you know, because we, for the most part, on the consumer side, we participate in staple food, center of the store with, really only one exception there. When things get tougher, it seems to attract more folks to the products that we're privileged to represent. That's both, store brand as well as main brand. I'd like to think that if things get tougher, consumer side would potentially benefit from that. Of course, that could have ramifications on other parts of the port-. No, sure. Historically, though, on a relative basis, it does work for you. Thinking about it in absolute terms was driving that question. I'm sorry. Go ahead. No, I was just gonna say, I basically didn't answer your question, did I? It's all part of the mosaic, though, Howard. It's all part of the mosaic. We appreciate it. Yeah. Thank you. Good luck in the quarter. Thank you. I am showing no further questions at this time. I would like to hand the conference back over to Ms. Lisa Weeks for her closing remarks. Yes, thank you all for joining us here today. I would highlight that we will be out on the road for the rest of the quarter, so please consult our website, and you'll see where you can connect with us. In the meantime, if you have any further questions, please don't hesitate to reach out. We hope you all have a wonderful day, and we talk to you on our next earnings call. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.