Canpack has announced its results for the three months ended on 31 March 2022.

Net sales increased 28% year-over-year. This positive performance was mainly driven by 5% volume growth in the Beverage Cans and Ends division, higher LME levels, which were passed through to customers, increased selling prices per unit, and higher transportation charges invoiced to customers.

Due to increased beverage can volumes, higher aluminium prices due to higher LME, premium and ingot to sheet conversion, higher labour costs primarily due to inflation, ramp-up costs related to the US operations at the Olyphant facility, and increased transportation costs during the three months ended March 31, 2022 compared to the corresponding period in 2021, resulted in increases.

Adjusted EBITDA increased to $132 million in Q1 2022 compared to $127 million in Q1 2021, an increase of 4%, driven by increased selling price per unit, partially offset by increased aluminium costs and $8 million of ramp-up costs related to the US operations at the Olyphant facility.

Capital expenditures increased to $91 million in Q1 2022 compared to $44 million in Q1 2021. This higher level of capital expenditures was mainly due to spending for the US greenfield projects in Olyphant, Pennsylvania, and Muncie, Indiana, compared to the level of capital expenditures spent. Q1 2021 capital expenditures primarily included spend connected with the two new facilities in the US and a new beverage ends line in the United Arab Emirates.

Net cash provided by operating activities increased by $31 million to a net inflow of $97 million in Q1 2022 from a net inflow of $66 million in Q1 2021. This increase in cash provided by operating activities was mainly due to higher adjusted EBITDA and an improvement in working capital employed in the business, mostly driven by a decrease in accounts receivable due to higher factored balances, partially offset by a higher value of inventory mainly as a result of an increase in LME and a higher level of finished goods.

Free cash flow improved by $8 million year-over-year from a cash inflow of $36 million in Q1 2021 to a $44 million cash inflow in Q1 2022. This performance was due to higher adjusted EBITDA and lower working capital employed, partially offset by higher capital expenditures during the three months ended March 31, 2022 compared to the corresponding period in 2021.

Chief executive officer, Roberto Villaquirán, commented: “I am pleased to report continued positive momentum against key performance measures. During the first quarter, we have faced significant operational challenges, rising input costs and continued tight supply chains.

“Despite this backdrop, first quarter beverage can bodies volume grew by 5%, with adjusted EBITDA of $132 million increasing 4% over the prior year. This performance is underpinned by Canpack’s resilient operating model, geographic diversity, strict cost controls and focus on efficiency, enabling the delivery of market-leading, innovative and sustainable packaging solutions to our customers. 

“I am deeply proud of how our teams and partners have responded, enabling Canpack to continue to grow and deliver to our customers in these challenging times.”