Berry Global Group, Inc.

Good day and thank you for standing by. Welcome to the fourth quarter 2022 Berry Global Group 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'll need to press star 1 1 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, Dustin Stilwell, Investor Relations. Please go ahead.

Thank you and good morning, everyone. Welcome to Barrie's fourth fiscal quarter 2022 earnings call. Throughout this call, we will refer to the fourth fiscal quarter as the September 2022 quarter. Before we begin our call, I would like to mention that on our website, we have provided this presentation to help guide our discussion this morning. After today's call, a replay will also be available on our website at barrieglobal.com under our investor relations section. Joining me from the company, I have Barrie's chief executive officer, Tom Salmon, and Chief Financial Officer Mark Miles. Following Tom and Mark's comments today, we will have a question and answer session. In order to allow everyone the opportunity to participate, we do ask that you limit yourself to one question at a time with a brief follow-up and then fall back into the queue for any additional questions. As referenced on slide two, during this call, we will be discussing some non-GAAP financial measures. The most directly comparable GAAP financial measures and a reconciliation of the differences between the GAAP and non-GAAP financial measures are available in our earnings release and investor presentation on our website. Please note that in our commentary today and within our presentation, when we compare our results to the prior year, quarter, or four year, we have adjusted to present on a constant currency basis and remove the impact of divested businesses to provide the appropriate comparable results. Reconciliations to reported results have been provided in our earnings release and the appendix of our presentation. And finally, a reminder that certain statements made today may be forward-looking statements. These statements are made based upon management's expectations and beliefs concerning future events impacting the company, and therefore involve a number of uncertainties and risks, including but not limited to those described in our earnings release, annual report on Form 10-K, and other filings with the SEC. Therefore, the actual results of operations or financial condition of the company could differ materially from those expressed or implied in our forward-looking statements. And now, I'd like to turn the call over to Barry's CEO, Tom Salmon.

Thank you, Dustin. Welcome, everyone, and thank you for being with us today. Turning to our key takeaways for the quarter and fiscal year on slide four. First, our business delivered solid full-year fiscal results, including record results for both revenue and earnings per share, growing 10% and 7% respectfully, coming off another record year in fiscal 2021. Secondly, throughout the last two years, we've seen significant cost inflation and have taken proactive pricing actions and invested in cost reduction projects across our businesses. Our team has done an exceptional job and continue to make progress on both fronts. Third, During the year, we generated a substantial $876 million of free cash flow and returned $709 million to shareholders via share repurchases, or approximately 9% of our total shares outstanding. We continue to invest for long-term growth while making great strides towards our sustainability goals and will continue to be ambitious with our commitments, which are leading to consistent opportunities to expand our relationships with our global customer base. As you saw in our press release issued this morning, Barrie has decided to initiate a quarterly cash dividend, which is a significant milestone for the company, while also increasing our capacity under our stock repurchase program to over $1 billion. And finally, on today's call, we will review our fiscal year 2023 goals and commitments, which include a continued focus on organic growth, inflation recovery, and reducing our costs along with the opportunity to deliver drawing returns on cash to shareholders through further share repurchases, taking advantages of our significantly undervalued share price. Turning now to the financial highlights on slide five. Our September quarterly performance was modestly below our expectations on revenue and EBITDA, which was primarily impacted by continued inflationary pressures and pockets of supply chain challenges, which resulted in softer customer demand along with the strengthening of the U.S. dollar. The company again demonstrated its ability to generate substantial cash delivering record free cash flow in the quarter. From an earnings perspective, EBITDA was up over 9% and adjusted EPS increased an impressive 18% from the prior year quarter, including an improvement in price cost spread of $58 million. As we've demonstrated historically and during the most recent quarter, we remain committed to packing through inflation and believe we are well positioned given our scale, along with our ability to service our customers from our facilities in close proximity to locations, which provides both cost and sustainability advantages. For the full year, we delivered revenues of $14.5 billion, a 10% increase in fiscal year record, and we met our adjusted earnings per share target of $7.40. And finally, We exceeded our most recent annual free cash flow guidance by $125 million, driven by strong working capital management. Also, we were able to delever for the third consecutive year, ending the fiscal year at 3.7 net debt to EBITDA, which is our lowest leverage ratio as a publicly traded company. Additionally, as you saw in this morning's announcements, Our Board of Directors has authorized an additional $700 million for share repurchases in addition to our current program, which has approximately $340 million remaining, putting the new total authorization over $1 billion. We believe our shares are significantly undervalued, and this increased authorization reflects our confidence in the outlook of our business, our long-term strategy, and the strength of our operating model and cash flows. Before I hand over to Mark, I want to cover a couple slides, specifically slide six, details our original fiscal 22 guidance to where we ended the year. Fiscal 22 provided some unique hurdles from an operations and demand perspective, not to mention forecasting challenges throughout the year. We are very fortunate to have such a dependable and diversified portfolio, which only saw modest headwinds on demand and enabled us to meet or exceed our guidance for cash flow and earnings per share. Slide 6, we have provided a comparison of our original guidance to actual fiscal 22 results. As you can see, the majority of the headwind was a result of foreign currency due to the strengthening of the U.S. dollar, along with softer customer demand, which despite our very stable and diversified portfolio, we weren't entirely immune to. In our consumer businesses, which represents 70% of our portfolio, demand remained steady. Our scale, global end markets, and product diversity provides a rather insulated demand profile for Barry. Those distribution and industrial markets did see some modest headwinds throughout the year in areas such as automotive and building and construction. We anticipate these to recover as overall global markets improve. And lastly, I'm proud of the agility of our teams working with customers as costs were consistently increasing throughout the fiscal year as a result of inflation. To put it into perspective, costs increased over $1.6 billion during the fiscal year, and we were able to offset these inflationary pressures. While we did end the year improved in price-cost spread, we have more inflation to recover and expect additional improvement in cost reduction benefits in fiscal 23. On slide 7, in both the near and long term, we remain focused on driving consistent, dependable, and sustainable organic growth. We continue to invest in each of our businesses to build and maintain our world-class low-cost manufacturing base with an emphasis on key end markets which offer greater potential for differentiation and growth, such as healthcare and pharmaceutical. Additionally, we will continue to invest and expand our emerging market position in support of our commitment to global growth. We believe that by increasing our presence in faster growing end markets along with continuing to invest in emerging market regions, we will further enhance our ability to provide consistent, dependable, and sustainable long-term growth. We've done a great job since our IPO in 2012, growing our emerging markets from less than 2% to now 15%. Longer term, we believe our emerging market presence can be more than 25% of our total revenues. And lastly, Innovation and sustainability are increasingly embedded in everything we do, and we continue to believe this represents a great opportunity for growth and differentiation, as I'll discuss in our later prepared remarks. Now, I'll turn the call to Mark to review Barry's financial results. Mark?