Yahoo Finanzen Crown Holdings Inc (CCK) Q1 2024 Earnings Call Transcript Highlights: Navigating Challenges ...
Earnings Per Share (EPS): Q1 2024 EPS was $0.56 per diluted share, down from $0.85 in Q1 2023.
Adjusted EPS: Adjusted diluted EPS for Q1 2024 was $1.02, compared to $1.20 in the same quarter last year.
Net Sales: Reported at $2.8 billion for Q1 2024, a decrease from $3 billion in Q1 2023.
Segment Income: $308 million in Q1 2024, down from $320 million in Q1 2023.
Free Cash Flow: Improved by $296 million in Q1 2024, primarily due to lower working capital and capital spending.
Net Leverage: Reduced to 3.4x at the end of Q1 2024 from 4.1x in the previous year.
Full Year Adjusted EPS Guidance: Projected to be between $5.80 and $6.20.
Full Year Adjusted Free Cash Flow: Estimated to be between $700 million and $750 million for 2024.
Capital Spending: Expected to not exceed $500 million for 2024.
Release Date: April 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Tim, the 7% growth in North America that you're forecasting for 2024, you mentioned share gains were part of that. Can you give us a sense as to your confidence on your share position as we look out to 2025 at this point? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: We had 7% growth in the first quarter, and I confirmed our growth target for this year in North America of 4% to 5%. I am extremely confident in that 4% to 5% for this year. We have no reason to believe that our share would do anything other than be slightly positive in '25 versus where we are today.
Q: How did Americas Beverage volume breakdown not only by geography but by category, so would you be able to speak to beer, seltzer, the other products? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: In North America, we're more heavily weighted towards nonalcoholic, although we do have some alcoholic but more heavily weighted to nonalcoholic carbonated soft drinks, sparkling waters, juices, teas, etc. In Mexico and Brazil, we're heavily weighted towards beer.
Q: In the release, there was a reference to continuous operational improvement. Could you provide any detail or quantification of that in terms of how much efficiency you think you can bring out of the system? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: The efficiency losses or increased spoilage is a natural effect of putting new capacity in. There's always improvement to be made in the new factories. Even in the more seasoned factories, the goal is to get better. It's principally around productivity, less spoilage, more good cans out the back end of the line.
: Could you give a bit more color in terms of why you think beverage cans have had a little bit of a stronger start to the year in your key markets? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: In Asia, the economies post-pandemic have really struggled, leading to more promotional activity by beer companies. In Europe, the destocking was so great last year that we have a little bit of a restocking effect. In North America, the market was flat, which is reflective of lower promotions.
Q: What are your customers telling you today in terms of how they're thinking about the year and how they're planning the year at this point versus, let's say, a few months ago? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: Our customers are not prepared to give up their value over volume strategy. It's yielding incredible benefits for them. At some point, they may get pressure from their bottlers or they may get pressure as they look at their share of the market versus their competition and sometimes people get concerned about share, more concerned about share perhaps than they should. And the way they deal with that is promotion, and we'll see who goes first.
Q: On transit, your comments were fairly in line with your expectations, at least for us, it was a little softer. How are things kind of progressing in 2Q? And do you expect earnings to be up in the back half with perhaps demand getting a little better? A: Timothy J. Donahue - Crown Holdings, Inc. - Chairman, President & CEO: We expect a similar performance in Q2 as Q1. Q3 may be a little flatter. And so we are hoping for a bounce back in Q4. So if there's -- we got a lot of puts and takes. And to your earlier question, are we confident, are we being conservative? Maybe in one business, we're being more conservative than another? And we just see how the year progresses in each of the businesses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
