O-I Glass Inc DE

Previous wording

The Company’s measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings before interest income, interest expense, and provision for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations and other adjustments as well as certain retained corporate costs. The segment data presented below is prepared in accordance with general accounting principles for segment reporting. The lines titled “reportable segment totals” in both net sales and segment operating profit, however, are non-GAAP measures when presented outside of the financial statement footnotes. Management has included reportable segment totals below to facilitate the discussion and analysis of financial condition and results of operations and believes this information allows the Board of Directors, management, investors and analysts to better understand the Company’s financial performance. The Company’s management, including the chief operating decision maker (defined as the Chief Executive Officer), uses segment operating profit, supplemented by net sales and selected cash flow information, to evaluate segment performance and allocate resources. Segment operating profit is not, however, intended as an alternative measure of operating results as determined in accordance with U.S. GAAP and is not necessarily comparable to similarly titled measures used by other companies.

Current wording

The Company’s measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings (loss) before interest expense, net, and provision for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations and other adjustments as well as certain retained corporate costs. The segment data presented below is prepared in accordance with general accounting principles for segment reporting. The lines titled “reportable segment totals” in both net sales and segment operating profit, however, are non-GAAP measures when presented outside of the financial statement footnotes. Management has included reportable segment totals below to facilitate the discussion and analysis of financial condition and results of operations and believes this information allows the Board of Directors, management, investors and analysts to better understand the Company’s financial performance. The Company’s management, including the chief operating decision maker (defined as the Chief Executive Officer), uses segment operating profit, supplemented by net sales and selected cash flow information, to evaluate segment performance and allocate resources. Segment operating profit is not, however, intended as an alternative measure of operating results as determined in accordance with U.S. GAAP and is not necessarily comparable to similarly titled measures used by other companies.

Previous wording

Segment operating profit for reportable segments in 2023 was $233 million higher compared to 2022, primarily due to higher net prices, strong operating performance, benefits from margin expansion initiatives and the favorable effects of changes in foreign currency exchange rates, partially offset by lower shipments, higher costs due to lower production volumes, driven by temporary curtailments of production to balance with lower demand, elevated planned asset project activity and the unfavorable impacts from divestitures in 2022.

Current wording

Segment operating profit for reportable segments in 2024 was $445 million lower compared to the prior year, primarily due to lower shipments, lower net prices (net of cost inflation) and higher operating costs. The higher operating costs were primarily due to lower production volumes driven by temporary curtailments of production

Previous wording

Net interest expense in 2023 increased $103 million compared to 2022, primarily due to higher interest rates and increased borrowings to fund the Paddock Trust in July 2022, as well as higher note repurchase premiums, the write-off of deferred refinancing fees and related charges.

Current wording

Net interest expense in 2024 decreased $7 million compared to 2023, primarily due to lower note repurchase premiums, write-offs of deferred finance fees and related charges, partially offset by higher interest rates.

Previous wording

In 2023, the Company recorded a net loss attributable to the Company of $103 million, or $0.67 per share (diluted), compared to net earnings attributable to the Company of $584 million, or $3.67 per share (diluted), in 2022. As discussed below, net earnings in both periods included items that management considers not representative of ongoing operations and other adjustments. These items decreased net earnings attributable to the Company by $594 million, or $3.76 per share, in 2023 and increased net earnings attributable to the Company by $218 million, or $1.37 per share, in 2022.

Current wording

In 2024, the Company recorded a net loss attributable to the Company of $106 million, or $0.69 per share, compared to a net loss attributable to the Company of $103 million, or $0.67 per share, in 2023. As discussed below, net loss attributable to the Company in 2024 and 2023 included items that management considers not representative of ongoing operations and other adjustments. These items increased net loss attributable to the Company by $233 million, or $1.50 per share, in 2024 and increased net loss attributable to the Company by $594 million, or $3.76 per share, in 2023.

Previous wording

The Company’s net sales in 2023 were $7,105 million compared with $6,856 million in 2022, an increase of $249 million, or 4%. Higher selling prices increased net sales by $883 million in 2023, driven by the pass through of higher cost inflation. Glass container shipments, in tons, declined approximately 12% in 2023, which in total decreased net sales by approximately $841 million compared to the prior year. This decline was mostly attributed to significant destocking across the value chain, as the Company’s customers, distributors and retailers adjust their inventory management practices to lower levels, and softer consumer consumption activity. Favorable foreign currency exchange rates increased net sales by $235 million in 2023 compared to 2022, primarily driven by the strengthening of the Mexican Peso and the Euro compared to the U.S. dollar. The divestiture of the Cristar glass tableware business in Colombia in March 2022 reduced net sales by approximately $8 million in 2023. Other sales were approximately $20 million lower in 2023 than in the prior year, driven by lower machine parts sales to third parties.

Current wording

The Company’s net sales in 2024 were $6,531 million compared with $7,105 million in 2023, a decrease of $574 million, or 8%. Average selling prices declined approximately 2%, which decreased net sales by $160 million in 2024. Glass container shipments, in tons, declined approximately 4% in 2024, which decreased net sales by approximately $348 million compared to the prior year. This decline resulted from soft consumer consumption and destocking across the value chain, especially in the spirits category, as the Company’s customers, distributors and retailers adjusted their inventory management practices to lower levels. Also, elevated competitive pressures due to spare capacity, particularly in Europe, impacted net sales in 2024. Unfavorable foreign currency exchange rates decreased net sales by $70 million in 2024 compared to the prior year.

Previous wording

Americas: Net sales in the Americas in 2023 were $3,865 million compared to $3,835 million in 2022, an increase of $30 million, or 1%. Higher selling prices in the region increased net sales by $287 million in 2023, driven by the pass through of higher cost inflation. Glass container shipments in the region were down approximately 10% in 2023 compared to 2022, which decreased net sales by approximately $385 million. Sales volumes (in tons) declined, primarily due to significant destocking activity, especially related to wine, spirits and beer customers, and softer consumer consumption activity. The favorable effects of foreign currency exchange rate changes increased net sales by $136 million in 2023 compared to the prior year, as the Mexican Peso strengthened compared to the U.S. dollar. The divestiture of the Cristar glass tableware business in March 2022 also reduced net sales by approximately $8 million in 2023 compared to 2022.

Current wording

Americas: Net sales in the Americas in 2024 were $3,584 million compared to $3,865 million in 2023, a decrease of $281 million, or 7%. Slightly higher selling prices in the region increased net sales by $19 million in 2024, driven by the pass through of higher cost inflation. Glass container shipments in the region were down approximately 3.5% in 2024 compared to the prior year, which decreased net sales by approximately $229 million. The decline in sales primarily resulted from destocking activity, especially related to spirits and beer customers, and soft consumer consumption. The unfavorable effects of foreign currency exchange rate changes decreased net sales by $71 million in 2024 compared to the prior year, as the Brazilian Real and Mexican Peso weakened compared to the U.S. dollar.

Previous wording

Europe: Net sales in Europe in 2023 were $3,117 million compared to $2,878 million in 2022, an increase of $239 million, or 8%. Higher selling prices in Europe increased net sales by $596 million in 2023, driven by the pass through of higher cost inflation. Glass container shipments declined by approximately 15% in 2023, primarily due to significant destocking activity, especially related to wine and food customers, softer consumer consumption activity, strikes in France and internal capacity and inventory constraints earlier in 2023. Lower shipments in 2023 decreased net sales by approximately $456 million compared to 2022. Favorable foreign currency exchange rates increased the region’s net sales by approximately $99 million in 2023, as the Euro strengthened in relation to the U.S. dollar.

Current wording

Europe: Net sales in Europe in 2024 were $2,820 million compared to $3,117 million in 2023, a decrease of $297 million, or 10%. Lower average selling prices in Europe decreased net sales by $179 million in 2024. Glass container shipments declined by approximately 4% in 2024, primarily due to destocking activity, especially related to wine and beer customers, elevated competitive pressures due to spare capacity and soft consumer consumption. Lower shipments in 2024 decreased net sales by approximately $119 million compared to the prior

Previous wording

Americas: Segment operating profit in the Americas in 2023 was $511 million, compared to $472 million in 2022, an increase of $39 million, or 8%. The benefit of higher selling prices exceeded cost inflation resulting in a net $288 million increase to segment operating profit in 2023. The impact of lower shipments discussed above resulted in a $95 million decrease to segment operating profit in 2023 compared to 2022. Operating costs in 2023 were $153 million higher than in the prior year. The increase in operating costs was primarily due to lower production volumes, driven by temporary curtailments of production to balance with lower demand, elevated planned asset project activity and lower income from a joint venture, partially offset by margin expansion initiatives, including approximately $35 million of lower operating costs as a result of the region’s restructuring actions taken between the fourth quarter of 2022 and 2023 (in line with management’s expectations) and approximately $7 million of insurance benefits that related to severe weather impacts in 2021. The effects of foreign currency exchange rates increased segment operating profit by $12 million in the current year.

Current wording

Americas: Segment operating profit in the Americas in 2024 was $392 million, compared to $511 million in 2023, a decrease of $119 million, or 23%. Higher cost inflation exceeded higher selling prices and resulted in a $41 million decrease to segment operating profit in 2024. The impact of lower shipments discussed above resulted in a $37 million decrease to segment operating profit in 2024 compared to 2023. Operating costs in 2024 were $44 million higher than in the prior year. The increase in operating costs was primarily due to lower production volumes, driven by temporary curtailments of production to balance with lower demand and reduce inventory levels, and higher costs related to the startup of a new plant in Bowling Green, Kentucky. Untilthe operations at the Bowling Green, Kentucky plant stabilize, the segment will continue to incur higher operating costs. Partially offsetting these higher costs in 2024 were effective operating and cost management activities, including approximately $65 million of lower operating costs as a result of the region’s restructuring actions taken in 2023 (in line with management’s expectations). The effects of foreign currency exchange rates increased segment operating profit by $3 million in 2024.

Previous wording

In order to better match production to customer demand, management has implemented temporary production curtailments in the region. This initiative has resulted in higher operating costs in the fourth quarter of 2023 due to unabsorbed fixed costs. Temporary production curtailments will continue in to 2024 and this is expected to increase operating costs. In addition, Europe will continue to monitor business trends and consider whether any permanent capacity closures will be necessary in the future to align its business with demand trends. Any permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

Current wording

demand levels. If implemented, temporary production curtailments would result in continued elevated operating costs in the segment. In addition, in 2024, the Americas announced the permanent closure of five furnaces and a reduction in the number of selling, general and administrative positions in connection with its Fit to Win initiative. The Company will continue to monitor business trends and consider whether any additional indefinite or permanent capacity closures in the Americas will be necessary in the future to align its business with demand trends. Any indefinite or permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

Previous wording

Europe: Segment operating profit in Europe in 2023 was $682 million compared to $488 million in 2022, an increase of $194 million, or 40%. The benefit of higher selling prices exceeded cost inflation and increased segment operating profit by $344 million in 2023 compared to the prior year. The impact of lower shipments discussed above decreased segment operating profit by approximately $110 million. Operating costs in 2023 were $57 million higher than in the prior year. The increase in operating costs was primarily due to lower production volumes, driven by the impact of temporary production curtailments to balance supply with demand, partially offset by benefits from the region’s margin expansion initiatives, higher earnings from joint ventures and approximately $16 million in subsidies received from the Italian government to help mitigate the impact of elevated energy costs, which subsidies are not expected to continue in 2024. The effects of foreign currency exchange rates increased segment operating profit by $17 million in the current year.

Current wording

Europe: Segment operating profit in Europe in 2024 was $356 million compared to $682 million in 2023, a decrease of $326 million, or 48%. Lower net selling prices (net of cost inflation) decreased segment operating profit by $140 million in 2024 compared to the prior year. The impact of lower shipments discussed above decreased segment operating profit by approximately $29 million. Operating costs in 2024 were $155 million higher than in the prior year, driven by temporary production curtailments to balance supply with demand and reduce inventory levels, lower earnings from joint ventures and the non-recurrence of approximately $16 million in subsidies received from the Italian government to help mitigate the impact of elevated energy costs in 2023, partially offset by benefits from effective operating and cost management. The effects of foreign currency exchange rates decreased segment operating profit by $2 million in 2024.

Previous wording

In order to better match production to customer demand, management has implemented temporary production curtailments in the region. This initiative has resulted in higher operating costs in the fourth quarter of 2023 due to unabsorbed fixed costs. Temporary production curtailments will continue in to 2024 and this is expected to increase operating costs. In addition, the Company announced the permanent closure of its Waco, Texas plant in September 2023 and two additional furnaces at other plants in North America in the fourth quarter of 2023 and will continue to monitor business trends and consider whether any further permanent capacity closures will be necessary in the future to align its business with demand trends. Any further permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

Current wording

In order to better match production to customer demand, management has implemented temporary production curtailments in the region. This initiative has resulted in higher operating costs in 2024 due to unabsorbed fixed costs. Temporary production curtailments may continue during 2025 depending on customer demand levels. If implemented, temporary production curtailments would result in continued elevated operating costs in the segment. Also, in the fourth quarter of 2024, the Company announced the permanent closure of three furnaces, a machine line and a reduction in the number of selling, general and administrative positions in Europe in connection with its Fit to Win initiative. Additional indefinite or permanent capacity closures in Europe will likely be necessary in 2025 to align its business with demand trends. These closures are dependent on the relevant discussions with certain European Workers’ Councils during 2025. Any indefinite or permanent capacity closures could result in material restructuring and impairment charges, as well as cash expenditures, in future periods.

Previous wording

In addition, the current conflict between Russia and Ukraine has caused a significant increase in the price of natural gas and increased price volatility. The Company’s European operations typically purchase natural gas under long-term supply arrangements with terms that range from one to five years and, through these agreements, typically agree on price with the relevant supplier in advance of the period in which the natural gas will be delivered, which shields the Company from the full impact of increased natural gas prices, while such agreements remain in effect. The Company’s energy risk management approach is to have long-term arrangements covering at least 40% of its expected total energy use over a medium-term horizon (generally at least two years), where possible. In most energy markets, the Company currently has more than 50% coverage over such medium-term horizon. Coverage varies by geography with higher coverage in Europe. However, the current conflict between Russia and Ukraine and the resulting sanctions, potential sanctions or other adverse repercussions on energy supplies could cause the Company’s energy suppliers to be unable or unwilling to deliver natural gas at agreed prices and quantities. If this occurs, it will be necessary for the Company to procure natural gas at then-current market prices and subject to market availability and could cause the Company to experience a significant increase in operating costs or result in the temporary or permanent cessation of delivery of natural gas to several of the Company’s manufacturing plants in Europe. In addition, depending on the duration and ultimate outcome of the conflict between Russia and Ukraine, future long-term supply arrangements for natural gas may not be available at reasonable prices or at all.

Current wording

In addition, the ongoing conflict between Russia and Ukraine has caused a significant change in the global gas market, resulting in a shift toward liquified natural gas. This transition has increased volatility in the market, as countries seek to diversify their energy sources and reduce dependance on traditional natural gas supplies. The Company’s European operations typically purchase natural gas under mid- to long-term supply arrangements with terms that range from one to three years and, through these agreements, typically agree on price with the relevant supplier in advance of the period in which the natural gas will be delivered, which shields the Company from the full impact of increased natural gas prices, while such agreements remain in effect. The Company’s energy risk management approach is to have coverage of at least 40% of its expected total energy use for the year ahead, where possible. However, the current conflict between Russia and Ukraine and the resulting sanctions, potential sanctions, government mandated curtailments or government imposed allocations, or other adverse repercussions on energy supplies could cause the Company’s energy suppliers to be unable or unwilling to deliver natural gas at agreed prices and quantities. If this occurs, it may be necessary for the Company to procure natural gas at then-current market prices and subject to market availability and could cause the Company to experience a significant increase in operating costs or result in the temporary or permanent cessation of delivery of natural gas to several of the Company’s manufacturing plants in Europe. In addition, depending on the duration and ultimate outcome of the conflict between Russia and Ukraine, future long-term supply arrangements for natural gas may not be available at reasonable prices or at all.

Previous wording

The Company’s effective tax rate from operations for 2023 was 227% compared to 22.1% for 2022. The effective tax rate for 2023 differed from 2022 due to a net unfavorable tax rate on the goodwill impairment charge and restructuring charges along with a valuation allowance added for interest deduction carryovers in 2023 compared to a net favorable tax rate on the gain on sale of the Vernon, California and Brampton, Canada land and buildings and the gain on sale of Cristar in 2022, as well as a change in the mix of geographic earnings.

Current wording

The Company’s effective tax rate from operations for 2024 was 332% compared to 227% for 2023. The effective tax rate for 2024 differed from 2023 due to a net unfavorable tax rate on restructuring charges and a change in the mix of geographic earnings. The annual effective tax rate for 2024 differs from the statutory U.S. Federal tax rate of 21%, primarily due to the geographic mix of pretax earnings and losses and their impacts on the overall rate.

Previous wording

For 2023, the Company recorded a net loss attributable to the Company of $103 million, or $0.67 per share (diluted), compared to net earnings attributable to the Company of $584 million, or $3.67 per share (diluted), in 2022. Earnings in 2023 and 2022 included items that management considered not representative of ongoing operations and other adjustments as set forth in the following table (dollars in millions):

Current wording

For 2024, the Company recorded a net loss attributable to the Company of $106 million, or $0.69 per share, compared to a net loss attributable to the Company of $103 million, or $0.67 per share, in 2023. Net loss attributable to the Company in 2024 and 2023 included items that management considers not representative of ongoing operations and other adjustments as set forth in the following table (dollars in millions).

Previous wording

Given the global nature of its operations, the Company is subject to fluctuations in foreign currency exchange rates. As described above, the Company’s reported revenues and segment operating profit in 2023 were higher due to foreign currency effects compared to 2022.

Current wording

Given the global nature of its operations, the Company is subject to fluctuations in foreign currency exchange rates. As described above, the Company’s reported revenues and segment operating profit in 2024 were lower or flat due to foreign currency effects compared to 2023.

Previous wording

For the year ending December 31, 2023, the European segment recognized approximately $37 million of expense related to emissions allowances to comply with the European Union Emissions Trading Scheme. In the Americas, the state of California in the U.S., Mexico, the Canadian federal government and the province of Quebec, among others, have adopted cap-and-trade or carbon pricing legislation aimed at reducing GHG emissions. As a result, the Americas segment recognized approximately $4 million of expense related to emissions credits and fees to comply with various country, state/province, or municipality laws or regulations. New laws or regulations, significant changes in the amount of emissions allowances granted to the Company or the Company’s manufacturing plants or significant fluctuations in the price or availability of these emissions credits could have a significant long-term impact on the Company’s operations that are affected by such regulations and could have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

Current wording

For the year ending December 31, 2024, the European segment recognized approximately $31 million of expense related to emissions allowances to comply with the European Union Emissions Trading Scheme. In the Americas, the state of California in the U.S., Mexico, the Canadian federal government and the province of Quebec, among others, have adopted cap-and-trade or carbon pricing legislation aimed at reducing GHG emissions. As a result, the Americas segment recognized approximately $4 million of expense related to emissions credits and fees to comply with various country, state/province, or municipality laws or regulations. New laws or regulations, significant changes in the amount of emissions allowances granted to the Company or the Company’s manufacturing plants or significant fluctuations in the price or availability of these emissions credits could have a significant long-term impact on the Company’s operations that are affected by such regulations and could have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

Previous wording

The Company has also been impacted by various fines or penalties as a result of noncompliance with various federal or local environmental statutes, including impacts to the Company’s reputation as it focuses on its sustainability initiatives and targets. For example, in June 2021, the Oregon Department of Environmental Quality (“DEQ”) alleged that the Company’s manufacturing facility in Portland, Oregon exceeded certain permitted air emission limits. To resolve this matter, in August 2021, the Company entered into an Order with the Oregon DEQ and agreed to pay a civil penalty of less than $1 million. The Company also agreed to submit a permit application to install pollution control equipment at its Portland, Oregon manufacturing facility or to cease its operations at that facility by June 30, 2022. In the second quarter of 2022, the Company submitted the permit application to install pollution control equipment, allowing it to continue operations at the Portland facility. The Company expects this pollution control equipment will be implemented in 2024 at an estimated cost of approximately $12 million.

Current wording

The Company has also been impacted by various fines or penalties as a result of noncompliance with various federal or local environmental statutes, including impacts to the Company’s reputation as it focuses on its sustainability initiatives and targets.

Previous wording

The Company has a near-term emissions reduction target validated by SBTi, which provides an emissions-reduction pathway that aligns with certain carbon-reduction scenarios. The assumptions and estimates used to support the target and pathway are based on existing SBTi frameworks and assumptions, which likely will evolve and change, and on assumptions about the existing and future state of marketplaces and technology, which likely will evolve and change. Also, the Company monitors its operations in relation to climate change risks and environmental impacts and has made, and may continue to make, significant expenditures for environmental improvements at certain of its facilities in recent years and in the future. The Company also generally seeks to invest in environmentally friendly and emissions-reducing projects, none of which have materially impacted the Company’s results of operations or cash flows. However, the Company is unable to predict what private or governmental climate change or environmental criteria or legal requirements may be adopted in the future, how public perception in relation to climate change and other ESG-related issues may change, or the impacts of those changes on its results of operations, access to and cost of capital or cash flows. Significant changes in

Current wording

The Company has a near-term emissions reduction target validated by third parties, which provides an emissions-reduction pathway that aligns with certain carbon-reduction scenarios. The assumptions and estimates used to support the target and pathway are based on certain third-party frameworks and assumptions, which likely will evolve and change, and on assumptions about the existing and future state of marketplaces and technology, which likely will evolve and change. Also, the Company monitors its operations in relation to climate change risks and environmental impacts and has made, and may continue to make, significant expenditures for environmental improvements at certain of its facilities in recent years and in the future. The Company also generally seeks to invest in environmentally friendly and emissions reducing projects, none of which have materially impacted the Company’s results of operations or cash flows. However, the Company is unable to predict what private or governmental climate change or environmental criteria or legal requirements may be adopted in the future, how public perception in relation to climate change and other ESG-related issues may change, or the impacts of those changes on its results of operations, access to and cost of capital or cash flows. Significant changes in regulations, criteria, public perception or legal requirements related to emissions reduction or fossil-fuel use could have a material impact on the Company’s results.

Previous wording

The Company experiences a variety of impacts due to weather-related events, including severe weather, and events related to climate change, which may include extreme storms, flooding, wildfires, extreme temperatures, and chronic changes in meteorological patterns, across its 68 manufacturing facilities in 19 different countries. For example, in February 2021, severe weather conditions swept across the southern United States, curtailing access to natural gas and electricity for several of the Company’s facilities. While the situation was most acute in Texas, access to natural gas in Mexico was also significantly impacted as Texas supplies natural gas to the country. The Company estimates that segment operating profit in 2021 in the Americas was negatively impacted by approximately $38 million from the severe weather that occurred in February of 2021, which includes surcharges for usage or excess usage of electricity and natural gas during the period of severe weather, as well as the estimated impacts of higher energy costs, lost production downtime, lost sales, and the cost of incremental repairs. As of December 31, 2023, the Company is pursuing insurance reimbursement related to this event but cannot determine the amount that will be reimbursed. Climate change may increase the frequency or severity of such events.

Current wording

The Company experiences a variety of impacts due to weather-related events, including severe weather, and events related to climate change, which may include extreme storms, flooding, wildfires, extreme temperatures, and chronic changes in meteorological patterns, across its 69 manufacturing facilities in 19 different countries. For example, in February 2021, severe weather conditions swept across the southern United States, curtailing access to natural gas and electricity for several of the Company’s facilities. While the situation was most acute in Texas, access to natural gas in Mexico was also significantly impacted as Texas supplies natural gas to the country. The Company estimates that segment operating profit in 2021 in the Americas was negatively impacted by approximately $38 million from the severe weather that occurred in February of 2021, which includes surcharges for usage or excess usage of electricity and natural gas during the period of severe weather, as well as the estimated impacts of higher energy costs, lost production downtime, lost sales, and the cost of incremental repairs. Climate change may increase the frequency or severity of such events.

Previous wording

In addition, there are indirect consequences of climate-related regulation or business trends that affect the Company’s business. For example, a contributor to the Company’s future success is likely to be its ability to improve its glass melting technology and introduce processes that emit less carbon. One of these new technologies, known as the MAGMA program, seeks to reduce the amount of capital required to install, rebuild and operate the Company’s furnaces. It also is focused on the ability of these assets to be more easily turned on and off or adjusted based on seasonality and customer demand, utilize more recycled glass, produce lighter containers and use lower-carbon fuels. The Company is implementing its MAGMA program using a multi-generation development roadmap, which will include various deployment risks and will require the discovery of additional inventions through 2026. If the Company is unable to continue to improve its glass melting technology through research and development or licensing of new technology, including but not limited to MAGMA, the Company may not be able to remain competitive with other packaging manufacturers.

Current wording

In addition, there are indirect consequences of climate-related regulation or business trends that affect the Company’s business. For example, if the Company is unable to continue to improve its glass melting processes and lower carbon emissions, the Company may not be able to remain competitive with other packaging manufacturers.

Previous wording

Retained corporate costs and other for 2023 were $224 million compared to $232 million in 2022.

Current wording

Retained corporate costs and other for 2024 were $134 million compared to $224 million in 2023. These costs decreased in 2024, primarily due to lower spending and management incentive expense.

Previous wording

During 2022, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $53 million. These charges reflect $50 million of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs (including related consulting costs attributed to restructuring of managed services activities) at several of the Company’s facilities primarily in the Americas. The Company expects that the majority of the remaining cash expenditures related to the accrued employee costs will be paid out over the next several years. These charges also reflect approximately $3 million of other charges.

Current wording

For the year ended December 31, 2024, the Company recorded restructuring and other charges of approximately $206 million to Other expense, net ($204 million) and Equity earnings ($2 million) in the Consolidated Results of Operations, primarily related to the Fit to Win program. These charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($79 million), Europe segment ($115 million) and Retained corporate costs and other ($14 million). Additional restructuring charges are expected in future quarters when management completes their assessment to reduce redundant production capacity. The Company expects that the majority of the remaining cash expenditures related to the accrued employee and other exit costs will be paid out over the next several years. These charges also reflect approximately $2 million of other credits.

Previous wording

During 2023, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $100 million. These charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas ($89 million) and Europe ($6 million) segments and Retained Corporate costs and other ($2 million). These restructuring charges were discrete actions and are expected to approximate the total cumulative costs for those actions, as no significant additional costs are expected to be incurred. These charges were recorded to Other income (expense), net on the Consolidated Results of Operations. The Company expects that the majority of the remaining cash expenditures related to the accrued employee costs will be paid out over the next several years. These charges also reflect approximately $3 million of other charges.

Current wording

For the year ended December 31, 2023, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $100 million. These charges consisted of employee costs, such as severance and benefit-related costs, write-down of assets and other exit costs in the Americas segment ($89 million), Europe segment ($6 million) and Retained Corporate costs and other ($2 million). These restructuring charges were discrete actions and are expected to approximate the total cumulative costs for those actions, as no significant additional costs are expected to be incurred. These charges were recorded to Other income (expense), net on the Consolidated Results of Operations. The Company expects that the majority of the remaining cash expenditures related to the accrued employee costs will be paid out over the next several years. These charges also reflect approximately $3 million of other charges.

Previous wording

During the fourth quarter of 2023, the Company completed its annual impairment testing and determined that the goodwill balance on its North America reporting unit was fully impaired. The primary driver of this impairment was management’s update to its long-range plan, which indicated lower estimated future cash flows for its North American reporting unit (in the Americas segment) as compared to the projections used in the prior

Current wording

During the fourth quarter of 2023, the Company completed its annual impairment testing and determined that the goodwill balance on its North America reporting unit was fully impaired. The primary driver of this impairment was management’s update to its long-range plan, which indicated lower estimated future cash flows for its North American reporting unit (in the Americas segment) as compared to the projections used in the prior goodwill impairment test performed as of October 1, 2022. As a result, the Company recorded a non-cash impairment charge of $445 million in the fourth quarter of 2023, which was equal to the remaining goodwill balance on its North America reporting unit.

Previous wording

Net interest expense in 2023 was $342 million compared to $239 million in 2022. The increase was primarily due to the impact of higher interest rates and increased borrowings to fund the Paddock Trust in July 2022 (see Note 14 to the Consolidated Financial Statements for further information), as well as $13 million of higher note repurchase premiums, the write-off of deferred financing fees and related charges.

Current wording

See Note 7 to the Consolidated Financial Statements for further information.

Previous wording

In 2023, the Company recorded pension curtailment and settlement charges of approximately $19 million in the United States and Mexico. In 2022, the Company settled a portion of its pension obligations and recorded approximately $20 million of pension settlement charges, in the United States, Canada and Mexico.

Current wording

In 2023, the Company settled a portion of its pension obligations and recorded approximately $19 million of pension settlement and curtailment charges, in the United States, Canada and Mexico.

Previous wording

On March 25, 2022, certain of the Company’s subsidiaries entered into a Credit Agreement and Syndicated Facility Agreement (the “Original Agreement”), which refinanced in full the previous credit agreement. The Original Agreement provided for up to $2.8 billion of borrowings pursuant to term loans, revolving credit facilities and a delayed draw term loan facility. The delayed draw term loan facility allowed for a one-time borrowing of up to $600 million, the proceeds of which were used, in addition to other consideration paid by the Company and/or its subsidiaries, to fund the Paddock Trust. On July 18, 2022, the Company drew down the $600 million delayed draw term loan to fund, together with other consideration, the Paddock Trust (see Note 15 for more information).

Current wording

On March 25, 2022, certain of the Company’s subsidiaries entered into a Credit Agreement and Syndicated Facility Agreement (the “Original Agreement”), which refinanced in full the previous credit agreement. The Original Agreement provided for up to $2.8 billion of borrowings pursuant to term loans, revolving credit facilities and a delayed draw term loan facility. The delayed draw term loan facility allowed for a one-time borrowing of up to $600 million, the proceeds of which were used, in addition to other consideration paid by the Company and/or its subsidiaries, to fund an asbestos settlement trust (the “Paddock Trust”) to resolve and pay current and future asbestos-related personal injury liabilities of Paddock Enterprises, LLC. On July 18, 2022, the Company drew down the $600 million delayed draw term loan to fund, together with other consideration, the Paddock Trust (see Note 15 for more information).

Previous wording

At December 31, 2023, the Credit Agreement includes a $300 million revolving credit facility, a $950 million multicurrency revolving credit facility and $1.45 billion in term loan A facilities ($1.39 billion outstanding balance at December 31, 2023, net of debt issuance costs). At December 31, 2023, the Company had unused credit of $1.24 billion available under the revolving credit facilities as part of the Credit Agreement. The weighted average interest rate on borrowings outstanding under the Credit Agreement at December 31, 2023 was 6.71%.

Current wording

At December 31, 2024, the Credit Agreement includes a $300 million revolving credit facility, a $950 million multicurrency revolving credit facility and $1.45 billion in term loan A facilities ($1.34 billion outstanding balance at December 31, 2024, net of debt issuance costs). At December 31, 2024, the Company had unused credit of $1.24 billion available under the revolving credit facilities as part of the Credit Agreement. The

Previous wording

The Credit Agreement contains various covenants that restrict, among other things and subject to certain exceptions, the ability of the Company to incur certain indebtedness and liens, make certain investments, become liable under contingent obligations in certain defined instances only, make restricted payments, make certain

Current wording

The Credit Agreement contains various covenants that restrict, among other things and subject to certain exceptions, the ability of the Company to incur certain indebtedness and liens, make certain investments, become liable under contingent obligations in certain defined instances only, make restricted payments, make certain asset sales within guidelines and limits, engage in certain affiliate transactions, participate in sale and leaseback financing arrangements, alter its fundamental business, and amend certain subordinated debt obligations.

Previous wording

On February 10, 2022, the Company announced the commencement, by an indirect wholly owned subsidiary of the Company, of a tender offer to purchase for cash up to $250.0 million aggregate purchase price of its outstanding (i) 5.875% Senior Notes due 2023, (ii) 5.375% Senior Notes due 2025, (iii) 6.375% Senior Notes due 2025 and (iv) 6.625% Senior Notes due 2027. On February 28, 2022, the Company repurchased $150.0 million aggregate principal amount of the outstanding 5.875% Senior Notes due 2023 and $88.2 million aggregate principal amount of the outstanding 6.625% Senior Notes due 2027. Following the repurchase, $550.0 million and $611.8 million aggregate principal amounts of the 5.875% Senior Notes due 2023 and 6.625% Senior Notes due 2027, respectively, remained outstanding. The repurchases were funded with cash on hand. The Company recorded approximately $16 million of additional interest charges for note repurchase premiums and the write-off of unamortized finance fees related to the senior note repurchases conducted in the first quarter of 2022.

Current wording

In May 2024, the Company repurchased€323.4 million aggregate principal amount of the outstanding 2.875% Senior Notes due 2025 pursuant to a tender offer and redeemed $300 million aggregate principal amount of the outstanding 6.375% Senior Notes due 2025. The repurchase and redemption were funded with the proceeds from the May 2024 senior notes issuances described above. The Company recorded approximately $2 million of additional interest charges related to the senior note repurchases conducted in the second quarter of 2024 for note repurchase premiums and the write-off of unamortized finance fees. At December 31, 2024, approximately €176 million aggregate principal amounts of the 2.875% Senior Notes due 2025 remained outstanding.

Previous wording

In May 2023, the Company issued €600 million aggregate principal amount of senior notes that bear interest at a rate of 6.250%per annum and mature on May 15, 2028. Also, in May 2023, the Company issued $690 million aggregate principal amount of senior notes that bear interest at a rate of 7.250% per annum and mature on May 15, 2031. The senior notes were issued via a private placement and are guaranteed by certain of the Company’s subsidiaries. The net proceeds, after deducting debt issuance costs, totaled approximately €593 million and $682 million, respectively, were used to redeem the aggregate principal amounts described in the May 2023 tender offers above.

Current wording

In May 2023, the Company issued €600 million aggregate principal amount of senior notes that bear interest at a rate of 6.250%per annum and mature on May 15, 2028. Also, in May 2023, the Company issued $690 million aggregate principal amount of senior notes that bear interest at a rate of 7.250% per annum and mature on May 15, 2031. The senior notes were issued via a private placement and are guaranteed by certain of the Company’s subsidiaries. The net proceeds, after deducting debt issuance costs were used to redeem senior notes described in the May 2023 tender offers below.

Previous wording

On May 26, 2023, the Company repurchased $142 million aggregate principal amount of the outstanding 5.875% Senior Notes due 2023, €666.7 million aggregate principal amount of the outstanding 3.125% Senior Notes due 2024, and $282.8 million aggregate principal amount of the outstanding 5.375% Senior Notes due 2025. The repurchases were funded with the proceeds from the May 2023 senior notes issuances described below. The Company recorded approximately $39 million of additional interest charges related to the senior note repurchases conducted in the second quarter of 2023 for note repurchase premiums, the write-off of unamortized finance fees and the settlement of a related interest rate swap. In August 2023, the Company redeemed approximately $108 million aggregate principal amount of its 5.875% Senior Notes due 2023. At December 31, 2023, approximately €58 million and $17 million aggregate principal amounts of the 3.125% Senior Notes due 2024 and 5.375% Senior Notes due 2025, respectively, remained outstanding.

Current wording

In May 2023, the Company repurchased $142 million aggregate principal amount of the outstanding 5.875% Senior Notes due 2023, €666.7 million aggregate principal amount of the outstanding 3.125% Senior Notes due 2024, and $282.8 million aggregate principal amount of the outstanding 5.375% Senior Notes due 2025. The repurchases were funded with the proceeds from the May 2023 senior notes issuances described above. The Company recorded approximately $39 million of additional interest charges related to the senior note repurchases conducted in the second quarter of 2023 for note repurchase premiums, the write-off of unamortized finance fees and the settlement of a related interest rate swap. In August 2023, the Company redeemed approximately $108 million aggregate principal amount of its 5.875% Senior Notes due 2023. At December 31, 2024, approximately $17 million aggregate principal amount of the 5.375% Senior Notes due 2025 remained outstanding.

Previous wording

Operating activities: Cash provided by operating activities was $818 million for 2023, compared to $154 million of cash provided by operating activities for 2022. The increase in cash provided by operating activities in 2023 was primarily due to the non-recurrence of the $621 million cash outflow that the Company paid in 2022 to fund the Paddock Trust and related expenses andthe non-recurrence of the gains from the sale of divested business and sale leaseback in 2022, partially offset by a higher use of cash from working capital and lower net earnings in 2023 compared to 2022. See Note 15 to the Consolidated Financial Statements for additional information on Paddock.

Current wording

Operating activities: Cash provided by operating activities was $489 million for 2024, compared to $818 million of cash provided by operating activities for 2023. The decrease in cash provided by operating activities in 2024 was primarily due to lower business performance, the non-recurrence of the $445 million goodwill impairment non-cash charge that occurred in 2023 and higher restructuring payments, partially offset by a lower use of working capital than in 2023.

Previous wording

Working capital was a use of cash of $148 million in 2023, compared to a source of cash of $95 million in 2022. The use of cash from working capital was higher in 2023 primarily due to higher inventories compared to 2022. The Company’s use of its accounts receivable factoring programs resulted in an increase in cash provided by operating activities of approximately $7 million and $54 million for 2023 and 2022, respectively. See Note 20 to the Consolidated Financial Statements for additional information. Excluding the impact of accounts receivable factoring, the Company’s days sales outstanding as of December 31, 2023 were comparable to December 31, 2022.

Current wording

Working capital was a use of cash of $125 million in 2024, compared to a use of cash of $148 million in 2023. The use of cash from working capital in 2024 was driven by lower accounts payable as spending levels declined compared to 2023 and lower income tax payables. The Company’s use of its accounts receivable factoring programs resulted in a decrease in cash provided by operating activities of approximately $7 million and an increase in cash provided by operating activities of approximately $7 million for 2024 and 2023, respectively. See Note 20 to the Consolidated Financial Statements for additional information. Excluding the impact of accounts receivable factoring, the Company’s days sales outstanding as of December 31, 2024 were comparable to December 31, 2023.

Previous wording

Investing activities: Cash utilized in investing activities was $683 million for 2023, compared to $97 million of cash utilized in investing activities for 2022. Capital spending for property, plant and equipment was $688 million in 2023, compared to $539 million in 2022. The Company estimates that its full year 2024 capital expenditures will be approximately$550 million to $600 million.

Current wording

Investing activities: Cash utilized in investing activities was $620 million for 2024, compared to $683 million of cash utilized in investing activities for 2023. Capital spending for property, plant and equipment was $617 million in 2024, compared to $688 million in 2023. The Company estimates that its full year 2025 capital expenditures will be approximately$400 million to $450 million.

Previous wording

Brampton, Ontario, Canada and Vernon, California. The Company contributed $10 million to its joint ventures in 2023 compared to $12 million contributed in the same period in 2022. The Company received $4 million and paid $24 million related to hedge activity in 2023 and 2022, respectively.

Current wording

The Company received approximately $29 million of net cash proceeds for the sale of miscellaneous businesses and other assets in 2024 compared to $11 million received in 2023. The Company contributed $3 million to its joint ventures in 2024 compared to $10 million contributed in 2023. The Company paid $29 million and received $4 million related to hedge activity in 2024 and 2023, respectively.

Previous wording

Financing activities: Cash utilized in financing activities was $27 million for 2023 compared to $6 million of cash provided by financing activities in 2022. Financing activities in 2023 included additions to long-term debt of $1,332 million, which included the issuance of€600 million of 6.250% senior notes due 2028 and $690 million of 7.250% senior notes due 2031. Financing activities in 2023 also included the repayment of long-term debt of $1,298 million, which included the redemption of$250 million of the Company’s outstanding 5.875% Senior Notes due 2023, €666.7 million of the Company’s outstanding 3.125% Senior Notes due 2024, and $282.8 million of the Company’s outstanding 5.375% Senior Notes due 2025. Financing activities in 2022 included additions to long-term debt of $2,852 million, which included the refinancing of the Company’s bank credit agreement. Financing activities in 2022 also included the repayment of long-term debt of $2,897 million, which included the refinancing of the Company’s bank credit agreement, the redemption of $450 million aggregate principal amount of the Company’s outstanding 5.875% senior notes due 2023 and the repayment of $88.2 million aggregate principal amount of the Company’s outstanding 6.625% Senior Notes due 2027. As a result of financing activities, the Company paid finance fees and premiums of $22 million and $29 million for 2023 and 2022, respectively. Borrowings under short-term loans were $47 million and $16 million in 2023 and 2022, respectively.

Current wording

Financing activities: Cash utilized in financing activities was $8 million for 2024 compared to $27 million of cash utilized by financing activities in 2023. Financing activities in 2024 included additions to long-term debt of $1,102 million, which included the issuance of €500 million aggregate principal amount of 5.250% senior notes due 2029 and $300 million aggregate principal amount of 7.375% senior notes due 2032. Financing activities in 2024 also included the repayment of long-term debt of $1,043 million, which included the repurchase of €323.4 million aggregate principal amount of the Company’s 2.875% Senior Notes 2025 pursuant to a tender offer and the redemption of $300 million aggregate principal amount of the Company’s 6.375% Senior Notes due 2025. Financing activities in 2023 included additions to long-term debt of $1,332 million, which included the issuance of€600 million aggregate principal amount of 6.250% senior notes due 2028 and $690 million aggregate principal amount of 7.250% senior notes due 2031. Financing activities in 2023 also included the repayment of long-term debt of $1,298 million, which included the repurchase and redemption of$250 million aggregate principal amount of the Company’s 5.875% Senior Notes due 2023, the repurchase of €666.7 million aggregate principal amount of

Previous wording

In February 2021, the Company’s Board of Directors authorized a $150 million anti-dilutive share repurchase program for the Company’s common stock that the Company intends to use to offset stock-based compensation provided to the Company’s directors, officers, and employees. In each of 2023 and 2022, the Company repurchased $40 million of shares of the Company’s common stock under this program. The Company intends to repurchase at least $30 million of shares of the Company’s common stock in 2024.

Current wording

In May 2024, the Company’s Board of Directors authorized a $100 million anti-dilutive share repurchase program for the Company’s common stock that the Company intends to use to offset stock-based compensation provided to the Company’s directors, officers, and employees. This repurchase program superseded and replaced a prior $150 million repurchase program authorized by the Board of Directors in February 2021. In each of 2024 and 2023, the Company repurchased $40 million of shares of the Company’s common stock under these share repurchase programs. The Company intends to repurchase at least $40 million of shares of the Company’s common stock in 2025.

Previous wording

The Company anticipates that cash flows from its opera­tions and from utiliza­tion of credit available under the Agreement will be sufficient to fund its operating and seasonal working capital needs, debt service and other obligations on a short-term (the next 12 months) and long-term basis (beyond the next 12 months). However, as the Company cannot predict the conflict between Russia and Ukraine and its impact on the Company’s customers and suppliers, the negative financial impact to the Company’s results cannot be reasonably estimated but could be material. In addition, cash and cash equivalents held by foreign subsidiaries may be subject to foreign withholding taxes upon repatriation to the U.S. At December 31, 2023 and December 31, 2022, the Company had approximately $810 million and $606 million, respectively, in cash and cash equivalents in certain of its foreign subsidiaries. The Company accrues withholding taxes for planned remittances in accordance with assertions under ASC 740 in regards to unremitted earnings. The Company is actively managing its business to maintain cash flow, and it has significant liquidity. The Company believes that these factors will allow it to meet its anticipated funding requirements.

Current wording

The Company anticipates that cash flows from its opera­tions and from utiliza­tion of credit available under the Agreement will be sufficient to fund its operating and seasonal working capital needs, debt service and other obligations on a short-term (the next 12 months) and long-term basis (beyond the next 12 months). However, as the Company cannot predict the conflict between Russia and Ukraine and its impact on the Company’s customers and suppliers, the negative financial impact to the Company’s results cannot be reasonably estimated but could be material. In addition, cash and cash equivalents held by foreign subsidiaries may be subject to foreign withholding taxes upon repatriation to the U.S. At December 31, 2024 and December 31, 2023, the Company had approximately $631 million and $810 million, respectively, in cash and cash equivalents in certain of its foreign subsidiaries. The Company accrues withholding taxes for planned remittances in accordance with assertions under ASC 740 in regards to unremitted earnings. The Company is actively managing its business to maintain cash flow, and it has significant liquidity. The Company believes that these factors will allow it to meet its anticipated funding requirements.

Previous wording

accepted in the United States (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. The Company evaluates these estimates and assumptions on an ongoing basis. Estimates and assumptions are based on historical and other factors believed to be reasonable under the circumstances at the time the financial statements are issued. The results of these estimates may form the basis of the carrying value of certain assets and liabilities and may not be readily apparent from other sources. Actual results, under conditions and circumstances different from those assumed, may differ from estimates.

Current wording

The Company’s analysis and discussion of its financial condition and results of operations are based upon its Consolidated Financial Statements that have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. The Company evaluates these estimates and assumptions on an ongoing basis. Estimates and assumptions are based on historical and other factors believed to be reasonable under the circumstances at the time the financial statements are issued. The results of these estimates may form the basis of the carrying value of certain assets and liabilities and may not be readily apparent from other sources. Actual results, under conditions and circumstances different from those assumed, may differ from estimates.