O-I Glass, Inc.

Thank you, Bailey, and welcome everyone to the OI Glass full year and fourth quarter 2024 earnings call. Our discussion today will be led by our CEO, Gordon Hardy, and our CFO, John Hodrick. Following prepared remarks, we will host a Q&A session. Presentation materials for this call are available on the company's website. Please review the safe harbor comments and the disclosure of our use of non-GAAP financial measures included in those materials. Now, I'd like to turn the call over to Gordon, who will begin on slide three.

Thanks, Chris. Good morning, everyone, and thank you for your interest in OIGlass. Today, we will walk you through our 2024 performance, our recent market trends, and our strategic initiatives, which we believe will drive solid recovery this year. But first, I would like to take the opportunity to thank all my colleagues at OI across the world for their efforts in 2024 and for their agility and focus in driving the changes needed to turn OI around. 2024 was a challenging year for OI. A sluggish market demand and macro conditions impacted our performance. Full year adjusted earnings were 81 cents per share, slightly exceeding our most recent guidance range, but down from historically high performance in 2023. For the fourth quarter, we reported an adjusted loss of 5 cents per share, compared to the adjusted earnings of 12 cents per share in the same period last year. These results reflected tough market conditions with sluggish demand, high in-home spirits inventories, especially in the US, overcapacity in certain European markets impacting net price. We also took aggressive inventory management actions in the second half of the year. While market conditions remain soft, demand has stabilized in recent months, and our fourth quarter costs and operating performance were better than anticipated, reflecting actions taken. This stabilization gives us confidence as we move forward. We are rapidly implementing our fit to win way of working, which is designed to improve our overall competitiveness by reducing our total cost of doing business, which will enable future sustainable growth. We believe these actions and the way of operating will significantly improve future earnings and cash flow. While our commercial outlook remains cautious until macro economic conditions improve and consumer confidence increases, we expect solid earnings improvement in 2025, driven by the benefits of our strategic initiatives. Specifically, we anticipate 2025 adjusted EPS to be in the range of 120 to 150 per share, representing a 50 to 85% increase from 2024 levels. Additionally, We expect free cash flow will be between $150 and $200 million, a substantial improvement from previous year's cash use. Now I will turn it over to John to provide a review of the 2024 results.

Thanks, Gordon, and good morning, everyone. As mentioned, 2024 was a tough year that impacted most of our key performance measures, as you can see on the chart. Yet it was also a year marked by critical decisions and decisive actions to set the business up for future performance improvement and value creation. Net sales were down from the prior year due to a 2% decline in selling prices and 4% lower sales volume, reflecting the market factors Gordon discussed. Adjusted EBITDA was also lower given market headwinds, which led to additional temporary production curtailment in 2024 to align supply with softer demand and reduce our inventory levels in the second half of the year. The impact of curtailment was partially offset by lower corporate retained expense. Higher interest expense and tax rate also weighed on our full-year EPS. However, adjusted earnings of 81 cents per share was slightly higher than our most recent guidance, thanks to better operating and cost performance later in the year. Free cash flow was a $128 million use of cash, reflecting lower earnings along with elevated restructuring, interest, and tax payments. However, free cash flow was slightly favorable to our guidance range due to good working capital management, despite CapEx being above guidance. we were able to accelerate some in-flight capital projects, which set the stage for substantially lower CapEx spending in 2025, which we will review a bit later. While debt remained fairly stable, the leverage ratio increased at 3.9 times, reflecting lower adjusted EBITDA. Finally, our economic spread was WAC minus 2% versus plus 2% in 2023, which was in line with our previous communications and reflected softer earnings. The appendix includes more information on 2024 trends. We expect most of our key performance measures to improve significantly in 2025 as we implement our strategic initiatives. Let's review our fourth quarter 2024 performance on page five. OI reported adjusted loss of five cents per share in the fourth quarter down from adjusted earnings of 12 cents in the same period last year. Net price was a headwind, although much less so than in the third quarter, and global sales volume was about flat as anticipated. Commercial headwinds were mostly offset by lower operating and corporate costs, thanks to early benefits from our cost reduction efforts. Consistent with the prior year, we temporarily curtailed about 17% of capacity in the fourth quarter to align supply with lower demand and rebalance inventories. Lower earnings also reflected an elevated tax rate due to a shift in regional earnings mix and minimum withholding tax requirements. Let's shift to segment profit as illustrated on the right. Segment operating profit in the Americas was $96 million compared to $93 million in the fourth quarter of 2023. Earnings benefited from a 5% growth in sales volume and lower operating costs, which was partially offset by unfavorable net price. Segment operating profit in Europe was $40 million, down from $75 million in the fourth quarter of 2023. This decline was due to unfavorable net price, a 5% decrease in sales volume, while operating costs were modestly favorable. Now I'll turn it back to Gordon, who will discuss market conditions on page six.