Berry (US:BERY)2022-08-03 16:00Financial Performance - Net sales for the quarter reached $3.726 billion, a 1% increase from the prior quarter's $3.675 billion, primarily driven by increased selling prices of $301 million due to inflation [51]. - Operating income for the quarter was $336 million, a decrease of 2% from $343 million in the prior quarter, impacted by a $22 million unfavorable foreign currency effect [52]. - For the year-to-date (YTD), net sales totaled $11.074 billion, a 9% increase from $10.181 billion in the prior YTD, mainly due to increased selling prices of $1.6 billion [67]. - Operating income for the YTD decreased to $906 million from $980 million in the prior YTD, influenced by unfavorable foreign currency impacts and volume declines [67]. - Comprehensive income declined by $262 million, mainly due to a $340 million unfavorable change in currency translation [83]. Segment Performance - The Consumer Packaging North America segment reported net sales of $927 million, a 9% increase from $847 million in the prior quarter, attributed to increased selling prices of $80 million [55]. - The Health, Hygiene & Specialties segment experienced a net sales decline of 5%, down to $788 million from $828 million, primarily due to a 3% volume decline and unfavorable foreign currency changes [59]. - Net sales in the Health, Hygiene & Specialties segment increased by $80 million, or 3%, primarily due to a $227 million increase in selling prices, despite a 3% volume decline [78]. - Operating income in the Health, Hygiene & Specialties segment decreased by $137 million, or 42%, mainly due to a $121 million unfavorable impact from price cost spread and negative product mix [79]. - The Engineered Materials segment's net sales increased by 1% to $915 million, driven by increased selling prices of $81 million, despite a 4% volume decline [61]. - Net sales in the Engineered Materials segment grew by $271 million, or 11%, driven by a $507 million increase in selling prices, offset by a 5% volume decline [80]. - Operating income in the Engineered Materials segment increased by $6 million, or 3%, attributed to a $42 million favorable impact from price cost spread [81]. Cash Flow and Capital Management - For fiscal 2022, the company projects cash flow from operations of $1.5 billion and free cash flow of $750 million, assuming $750 million in capital spending [48]. - The company repurchased approximately 11 million shares for $637 million in fiscal 2022 year-to-date and plans to purchase at least $700 million of shares [48]. - Free cash flow for the year-to-date was $(211) million, with an outlook of $750 million for fiscal 2022 [88]. - Net cash from operating activities decreased by $567 million, primarily due to working capital inflation and timing of payables [86]. Interest and Currency Impact - Interest expense decreased by $45 million, or 18%, primarily due to refinancing activities and repayments of borrowings [82]. - A 10% decline in foreign currency exchange rates would have resulted in a $15 million unfavorable impact on net income for the three quarterly periods ended July 2, 2022 [97]. Supply Chain and Operational Challenges - The company expects ongoing supply chain challenges and will continue to work closely with suppliers and customers to mitigate impacts [47].