Silgan Holdings Inc.

Please stand by. Good day and welcome to the Silgan Holdings First Quarter 2026 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Alex Hutter, Senior Vice President, Strategy and Investment Relations. Please go ahead.

Thank you and good morning. Joining me in the call today are Adam Greenlee, President and CEO, Philippe Chevrier, EVP and COO, and Sean Fabry, EVP and CFO. Before we begin the call today, we would like to make it clear that certain statements made on this call may be forward-looking statements. These forward-looking statements are made based on 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 the company's annual report on Form 10-K for 2025 and other filings with the Securities and Exchange Commission. Therefore, the actual results of operations or financial condition of the company could differ materially from those expressed or implied in the forward-looking statements. In addition, commentary on today's call may contain references to certain non-GAAP financial metrics, including adjusted EBIT, adjusted EBITDA, free cash flow, and adjusted net income for diluted share, or adjusted EPS. A reconciliation of these metrics, which should not be considered substitutes for similar GAAP metrics, can be found in today's press release and under the non-GAAP financial information portion of the investor relations section of our website at Sylvanholdings.com. With that, let me turn it over to Adam.

Thank you, Alex, and we'd like to welcome everyone to Sylvan's first quarter earnings call. Our first quarter results display the resilience of our business and the power of our diverse portfolio and continue to demonstrate the unique value of our critical packaging products and the strength of our long-term customer partnerships in the market. Our teams executed well during the quarter and adapted to dynamic operating and market conditions. We're pleased to have delivered first quarter results that were at the high end of our estimated range, and we remain confident in our outlook for the balance of the year despite the evolving macroeconomic and geopolitical environment. Our results in dispensing and specialty closures were consistent with our expectations entering the quarter despite significant weather events in North America that impacted both our and our customers' production and volumes during the quarter. We delivered another quarter of double-digit organic volume growth in our fragrance and beauty products as a result of our market-leading innovation and customer partnership model. We continue to outperform the market in these high-value strategic growth products, and with the Vayner portfolio now fully integrated in the power of the combined innovation engines of our legacy business and Vayner, we see ample runway to continue to deliver organic growth well in excess of the market for many years to come in this business. Our metal containers business started the year strong, with volume 2% higher than the prior year, as pet food products increased by 11% over the prior year, despite facing a more difficult year-over-year comp, with the prior year quarter up 6% year-over-year. Consumer demand for our customers' market-leading pet food products continues to grow at a mid-single-digit rate as our mainstream wet pet food products serve the fastest-growing segments of the pet food market for cats and small dogs. The strength we experienced in pet food in the first quarter was partially offset by the expected impact of pre-buy related volumes for fruit and vegetable markets. In custom containers, our team continued to prove the value we provide as an innovative partner of choice in the unique small and medium run length portion of the market we serve. And our results were consistent with our expectations entering the quarter. As expected, our custom containers volumes were below prior year levels as customer destocking from the prior year carried into and concluded in the first quarter of 2026. In addition, we continue to lap the volume impact of our cost reduction activities in 2025, which should become less impactful as we move through the quarters in 2026. We are pleased to have started 2026 on a positive note. and our business remains on solid footing as we move into the second quarter and look ahead at the second half of 2026. While much has changed in geopolitics since our last earnings call, and the economic landscape is less certain, the deliberate construct of our portfolio of products and end markets, our long-term partnerships with our customers, and our low-cost global manufacturing footprint continue to uniquely position Sylvan to outperform through all stages of the economic cycle. Turning now to our outlook, we are raising our 2026 earnings estimate to reflect the operational outperformance in the first quarter and our volume expectations for the remainder of the year remain largely unchanged. We continue to expect dispensing and specialty closures organic volume mix to grow by a low to mid single digit rate in 2026, driven by mid single digit growth in our dispensing products. Our metal containers volumes are on track to grow by a low single digit percentage, driven by mid-single-digit growth in pet food and stable volumes in human food. We continue to expect our custom containers volumes to be comparable to prior year levels, as destocking in the first quarter and the exit of business to achieve cost reduction goals in the prior year weigh on first half volumes, while second half volumes are expected to grow as new business ramps up. Our teams remain laser focused on executing our plans for the year and the opportunities that lay ahead for the company in both the near and longer term, and we are confident in our ability to execute on our plan. With that, Sean, we'll take you through the financials for the quarter and our estimates for the second quarter and full year 2026.