O-I Glass(OI) - 2023 Q3 - Quarterly Report

Financial Performance - Net sales for Q3 2023 were $1,743 million, an increase of$50 million, or 3%, compared to Q3 2022, driven by higher prices and favorable foreign currency exchange rates [111][116]. - Segment operating profit for reportable segments in Q3 2023 was $301 million, an increase of$35 million, or approximately 13%, compared to Q3 2022, primarily due to higher net prices and margin expansion initiatives [122]. - Net earnings attributable to the Company in Q3 2023 were $51 million, or$0.32 per share, compared to $231 million, or$1.45 per share, in Q3 2022, reflecting a significant decrease [115]. - Net sales for the first nine months of 2023 increased by $301 million, or 6$5,464 million compared to the same period in 2022 [133][139]. - Net earnings attributable to the Company for the third quarter of 2023 were $51 million, or$0.32 per share (diluted), down from $231 million, or$1.45 per share (diluted), in the third quarter of 2022 [132]. - Segment operating profit for reportable segments in the first nine months of 2023 was $1,025 million, an increase of$272 million, or approximately 36%, compared to the same period in 2022 [145]. - The Company recorded earnings before income taxes of $506 million in the first nine months of 2023, a decrease of$270 million from $776 million in the same period of 2022 [143]. - Net earnings attributable to the Company for the first nine months of 2023 were$367 million, or $2.31 per share, down from$571 million, or $3.59 per share, in the same period of 2022 [156]. Sales and Shipments - Glass container shipments declined approximately 15$271 million compared to the same period in 2022 [116]. - In the Americas, net sales decreased by $39 million, or 4$948 million in Q3 2023, primarily due to lower shipments and significant destocking activity [118]. - In Europe, net sales increased by $86 million, or 13$766 million in Q3 2023, driven by higher selling prices and favorable foreign currency exchange rates [119]. - Glass container shipments declined approximately 11% in the first nine months of 2023, decreasing net sales by approximately $559 million compared to the same period in 2022 [139]. - In Europe, net sales increased by$275 million, or 13%, to $2,428 million in the first nine months of 2023 compared to the same period in 2022 [142]. Costs and Expenses - Earnings before income taxes were$82 million in Q3 2023, a decrease of $196 million compared to Q3 2022, attributed to higher interest expense and restructuring charges [120]. - The Company recorded a net interest expense increase of$15 million in Q3 2023, primarily due to higher interest rates [114]. - Net interest expense for the first nine months of 2023 increased by $88 million compared to the same period in 2022, primarily due to higher interest rates [137]. - The effective tax rate for the third quarter of 2023 was 31.7$800 million and $850 million for 2023, reflecting variability in sales and production volume [157]. - Cash provided by operating activities was$437 million for the nine months ended September 30, 2023, compared to a cash utilization of $224 million in the same period in 2022 [187]. - Working capital was a use of cash of$416 million in the first nine months of 2023, compared to a use of cash of $162 million in the same period in 2022 [188]. - Cash utilized in investing activities was$457 million for the nine months ended September 30, 2023, compared to $108 million of cash provided in the same period in 2022 [189]. - Capital spending for property, plant, and equipment was$465 million during the first nine months of 2023, compared to $346 million in the same period in 2022 [189]. - Cash provided by financing activities was$31 million for the nine months ended September 30, 2023, compared to $54 million of cash utilized in financing activities in the same period in 2022 [192]. - The Company anticipates that cash flows from operations and available credit will be sufficient to fund its operating and seasonal working capital needs, debt service, and other obligations [194]. - The Company has$1.24 billion in unused credit available under its Credit Agreement as of September 30, 2023, with a weighted average interest rate of 6.84% on outstanding borrowings [172]. Strategic Initiatives and Risks - The Company is actively reviewing its remaining businesses in the former Asia Pacific region to explore options for maximizing shareholder value, which may lead to divestitures or corporate transactions [161]. - The ongoing conflict between Russia and Ukraine may impact the Company's operations, particularly regarding energy supply agreements and costs [159]. - The current conflict between Russia and Ukraine has caused significant increases in natural gas prices and price volatility, impacting the Company's European operations [150]. - The Company faces various risks that may impact future financial performance, including geopolitical tensions, supply chain disruptions, and inflationary pressures [199]. - The ongoing Ukraine-Russia and Israel-Hamas conflicts are affecting the cost and availability of raw materials, labor, and transportation [199]. - The Company is evaluating its strategic plan to navigate market uncertainties and achieve growth objectives [199]. - The Company is focused on improving its glass melting technology through the MAGMA program, which is critical for operational efficiency [199]. - There is a risk of unanticipated operational disruptions, including higher capital spending, which could affect financial outcomes [199]. - The Company must manage its cost structure effectively to achieve operational efficiency and working capital management [199]. - Future cash flow generation is essential to ensure that the Company's goodwill remains intact [199]. Compliance and Governance - As of September 30, 2023, the Company was in compliance with all covenants and restrictions in the Credit Agreement [175]. - The Company believes it will remain in compliance with the Credit Agreement for its term [175]. - The Company is subject to increased scrutiny regarding environmental, social, and governance (ESG) factors, which may impact operations [199]. - There have been no material changes in market risk as of September 30, 2023, compared to the previous year [202]. - Forward-looking statements are based on assumptions that may not guarantee future performance, highlighting the need for cautious optimism [201].