Agenda
- Glass packaging market overview
- Volume growth and contraction rates by product category
- Capacity reduction, demand trends and equilibrium sustainability
- The impact at-risk breweries have on glass facilities
- Owens-Illinois’ magna furnace analysis
Questions
1.
What are your broad thoughts on the glass packaging industry? What do you think investors should pay attention to when evaluating the sector? What trends or news are you following?
2.
What is your view on the penetration of glass vs other substrates across individual product categories? How should we think about subsequent volume trends?
3.
Can you explain the new age drink category?
4.
Can you discuss the potential for glass packaging in cannabis drinks, how you foresee that evolving and why?
5.
Can you separate the beer category by craft vs mass beer? What is the split in terms of volumes?
6.
What percentage is glass packaging in the craft beer segment and how do you expect that to evolve, given the recent downward trend in that number.
7.
What are your thoughts on glass packaging penetration in the mega beer category going forward? Is there a lower limit where it bottoms out?
8.
Wine has started to be packaged in cans. Do you expect that to be a growing percentage of the market going forward? Is there a significant risk of cans taking away from glass in the wine category?
9.
Can you discuss the quality differentials of domestically produced and imported glass? What are the tangible differences? How have you seen the gap in quality narrow and how do you expect the gap to develop going forward?
10.
Does the fact that there is a quality differential not imply that it is not Owens-Illinois or the other domestic manufacturers that have the know-how?
11.
Is there a worst-case scenario for imported volumes going forward, in your mind?
12.
If imports make up 5-7% of the overall US glass market, do you have any sense of the market share of imports in the West Coast market specifically?
13.
I think the implication of what you are saying is that there is little fear that trade negotations could break down, so buyers are not repositioning toward domestic producers as a result of a potential tariff hike. Is that the case?
14.
How long would it take customers to shift where they are sourcing from if a tariff was to come into effect?
15.
Are any identifiable breweries at risk of shutting down that would have an outsized impact on particular glass facilities?
16.
What is the net impact of the shift to liquor and wine from beer on volumes and what is the penetration of glass in those segments?
17.
What do you think capacity utilisation is in the glass packaging manufacturing industry?
18.
Are the manufacturers who shifted their volumes going to be able to increase output in terms of volumes or is this about margins?
19.
You said that most energy has pass-through mechanisms contractually. Do any other cost elements have similar mechanisms?
20.
What potential cost savings opportunity might there be during the renegotiation procedure for contract renewals?
21.
What capacity reductions do you expect going forward? Which plants are most likely to close as a result, in your view?
22.
Owens talked about its new glass melting technology during its last analyst day. Can you share any insight on that? Do you think the technology gives the company an edge over others? How might it impact competitive dynamics?
23.
There are some concerns around environmental sustainability picking up. Do you foresee that impacting the glass industry going forward, especially among younger customers that might be more prone to that kind of thing?
24.
What is your outlook for the next 12 months? Can you share best- and worst-case scenarios for glass? Would you like to mention anything that we have not discussed?
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