BALL Corp (BALL)·Q3 2025 Earnings Summary

Executive Summary

• Q3 delivered top-line outperformance with net sales of $3.379B vs S&P Global consensus of $3.319B (≈+1.8%); comparable diluted EPS of $1.02 was essentially in line with consensus $1.022, while GAAP diluted EPS rose to $1.18 (vs $0.65 LY) on lower non‑comparable items . Revenue consensus and EPS consensus values marked with * are from S&P Global.*
• Global aluminum packaging shipments increased 3.9% YoY; segment comp operating earnings grew in all regions (NCA +$7M, EMEA +$19M, South America +$2M), with EMEA notably strong; mix headwinds and tariff friction still constrained NCA operating leverage .
• Guidance maintained: 2025 comparable diluted EPS growth of 12–15%; at least $1.5B capital return in 2025; updated color on FY25 interest expense (~$320M), tax rate (slightly >22%), buybacks (≥$1.3B), CapEx below D&A, and year‑end leverage “slightly above 2.75x” net debt/Comparable EBITDA .
• Stock reaction catalysts: a clear revenue beat, confidence in hitting full‑year EPS growth range, robust EMEA momentum, and disciplined capital return; offset by continued mix/tariff headwinds in North America and negative YTD free cash flow from working capital build despite strong operating execution .

What Went Well and What Went Wrong

• What Went Well

  • Broad‑based volume recovery: Global shipments +3.9% YoY; EMEA and South America delivered mid‑single‑digit volume gains alongside higher segment comp operating earnings .
  • Revenue beat and solid segment P&L: Sales $3.379B beat consensus; segment comp op. earnings rose to $437M (from $409M LY) on volume and execution .
  • Capital returns and confidence: YTD returns reached $1.27B; management reaffirmed 12–15% comparable EPS growth and reiterated “on pace to meet or exceed” annual objectives. CEO: “Ball delivered strong third‑quarter results... Our solid financial position... drove higher volumes and operating earnings” .

• What Went Wrong

  • North America operating leverage below historical: Mix shift to lower‑margin packs and categories tempered flow‑through; CEO acknowledged leverage “below historical norms” despite volume strength .
  • Tariff and supply chain friction: Section 232 tariffs required 25–30% price pass‑through to customers, adding complexity and inefficiencies even as the company mitigates impacts .
  • Working capital drag on FCF: YTD free cash flow was negative ($253M; adjusted FCF −$193M), primarily due to working capital build and timing of cash tax on aerospace sale .

Financial Results

Segment breakdown – Q3 2025 vs Q3 2024

• Sales
  • Beverage Packaging, North & Central America: $1.638B vs $1.456B
  • Beverage Packaging, EMEA: $1.059B vs $0.950B
  • Beverage Packaging, South America: $0.508B vs $0.484B
• Comparable Segment Operating Earnings
  • North & Central America: $210M vs $203M
  • EMEA: $147M vs $128M
  • South America: $80M vs $78M

KPIs and balance sheet/cash

• Global aluminum packaging shipment growth: Q1 +2.6% ; Q2 +4.1% ; Q3 +3.9%
• YTD capital return: $0.612B (Q1) ; $1.13B (Q2) ; $1.27B (Q3)
• YTD Free Cash Flow: −$253M; Adjusted FCF: −$193M
• Trailing Interest Coverage (Comparable EBITDA/Interest Expense): 6.67x; Leverage (Net Debt/Comparable EBITDA): 3.31x

Non‑GAAP bridge (Q3)

• Comparable Net Earnings $277M and Comparable Diluted EPS $1.02 reflect add‑backs for amortization of acquired intangibles ($33M), and non‑comparable items (e.g., $86M gain on KSA JV sale) among others .

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• Strategic tone: “Our solid financial position, streamlined operating model, and disciplined growth strategy drove higher volumes and operating earnings” — Daniel W. Fisher, CEO .
• Outlook confidence: “On pace to meet or exceed our financial objectives... expectation to return at least $1.5 billion to shareholders in 2025” — Dan Rabbitt, SVP & Interim CFO .
• NCA economics: “We saw continued customer and pack‑size mix shift toward lower margin categories... profit per can since 2019... has grown 32%” — CEO .
• Margin levers/AI: “The market’s tight... there’s room for margin improvement... early days even with AI technology deploying... in our plants and supply chain” — CEO .

Q&A Highlights

• NCA operating leverage/mix: Mix shifts to lower‑margin SKUs curbed leverage despite mid‑SD% volume growth; leverage expected to improve as Millersburg, OR comes online H2’26 and footprint efficiency rises into 2027 .
• Tariffs pass‑through: Section 232‑related pass‑through of ~25–30% to customers; reversal would be a positive COGS move for customers; Ball actively mitigating supply chain inefficiencies .
• Capacity roadmap: Millersburg, OR targeted H2’26; Concord, NC longer‑dated; 2027 capacity unlock of ~1.5B cans, potentially lifting profitability per can to record levels .
• Inventory/metal supply: Inventory up partly due to days added and higher aluminum costs; Novelis outage had no material impact; medium‑term metal supply outlook supported by new can‑sheet capacity (Novelis, SDI) .
• Strategic investment: Small public stake linked to ORG Technology (largest can producer in China), supporting strategic partnership; deconsolidation of Saudi JV and retained 10% interest .

Estimates Context

How results compared to S&P Global consensus (historicals and consensus in USD):

• Q3 2025: Revenue $3.379B vs $3.319B consensus*; comparable EPS $1.02 vs $1.022 consensus* — revenue beat, EPS essentially in line .
• Q2 2025: Revenue $3.338B vs $3.115B consensus*; comparable EPS $0.90 vs $0.872 consensus* — beat on both .
• Q1 2025: Revenue $3.097B vs $2.896B consensus*; comparable EPS $0.76 vs $0.699 consensus* — beat on both .

Where estimates likely adjust: modest upward revisions to EMEA profitability and consolidated revenue; limited EPS change given in‑line Q3 EPS, with FY tax/interest guidance now clearer .

Key Takeaways for Investors

• Revenue momentum broad‑based with a clean Q3 beat and mid‑SD% global volume growth; EMEA is the key earnings driver near‑term .
• NCA remains volume‑healthy but mix/tariff frictions cap flow‑through; footprint optimization (Millersburg H2’26) is the path to normalized operating leverage into 2027 .
• Full‑year 12–15% comparable EPS growth reaffirmed; FY25 interest (~$320M) and tax (>22%) parameters increase visibility on the P&L bridge .
• Capital returns remain a central pillar (≥$1.5B in 2025; ≥$1.3B buybacks), with management acknowledging potential moderation in 2026 from unusually high 2025 levels .
• YTD FCF negative on working capital/tax timing, but management still targets adjusted FCF ≈ comparable net earnings for FY25; watch Q4 cash conversion .
• Strategic portfolio moves (KSA JV deconsolidation, Florida Can acquisition) and AI‑enabled productivity provide medium‑term margin optionality without relying on price .
• Near‑term trading lens: positive setup on revenue and reaffirmed guidance vs an in‑line EPS print; tariff headlines and NCA mix are the swing variables, while EMEA outperformance is the support .

---

Appendix: Additional Press Releases (Q3 context)

• Dividend: Board declared $0.20/share payable Dec 15, 2025 (record date Dec 1, 2025) .
• KSA JV sale: Closed sale of 41% of 51% stake in Saudi JV to ORG; deconsolidated, retained 10% interest, aligning with returns‑focused portfolio strategy .