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What changed in Ball Corporation's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Ball Corporation's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+208 added−195 removedSource: 10-K (2024-02-20) vs 10-K (2023-02-21)

Top changes in Ball Corporation's 2023 10-K

208 paragraphs added · 195 removed · 154 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

62 edited+14 added−16 removed30 unchanged
Biggest changeAdditionally, all employees have access to create a personal development plan and we have resources to support employees in their personal and professional development, including: ​ ● Continuous education through various tuition reimbursement programs, apprenticeship and instructional programs; ● A learning management platform that has had significant employee utilization; ● Monthly global leadership panel discussions and breakout groups focused on real-time topics, such as supporting team wellbeing, working through stressful times, setting individual development goals, maximizing team performance, sharing practical steps to better enable our collective focus on D&I and sharing other best practice leadership behaviors; ● A new LinkedIn Learning platform for all corporate and packaging employees who work in an office setting; ● Leadership and personal development coaching opportunities by teaming with BetterUp; ● On-going education for people leaders around our Inspire, Connect, and Achieve leadership behaviors; and ● Annual compliance, antitrust, bribery, corruption and business code of conduct and ethics training for key management level, sales and supply chain employees. 7 Table of Contents Employee Engagement ​ As part of our Drive for 10 vision, we seek to ensure that everyone at Ball is motivated to perform their best work every day.
Biggest changeAdditionally, all employees have access to create a personal development plan and we have resources to support employees in their personal and professional development, including: ​ ● Continuous education through various tuition reimbursement programs, apprenticeship and instructional programs; ● A corporate academy platform designed to provide employees with a seamless and unified learning experience empowering them to thrive, grow, and reach their fullest potential; ● Monthly global leadership communications focused on real-time topics, such as supporting team wellbeing, working through stressful times, setting individual development goals, maximizing team performance, sharing practical steps to better enable our collective focus on D&I and sharing other best practice leadership behaviors; ● LinkedIn Learning platform for all corporate and packaging employees; ● Professional and personal development coaching opportunities by teaming with a global coaching firm; ● Intentional leadership programs for people leaders at all levels around our Inspire, Connect, and Achieve leadership behaviors; and 7 Table of Contents ● Annual compliance, antitrust, bribery, corruption and business code of conduct and ethics training for key management level, sales and supply chain employees. ​ Employee Engagement ​ At Ball, we aim to inspire and engage employees so they are focused on the work that matters most, perform their best work and choose Ball every day.
More and more, our systems are measuring key elements of the physical environment and supporting environmental monitoring and operational weather forecasting programs, as well as providing environmental intelligence on weather, the Earth's climate system, precipitation, drought, GHG emissions and air pollution, as well as wildlife, vegetation and other biodiversity measurements.
More and more, our systems are measuring key elements of the physical environment, supporting environmental monitoring, and operational weather forecasting programs, as well as providing environmental intelligence on weather, the Earth's climate system, precipitation, drought, GHG emissions and air pollution, as well as wildlife, vegetation and other biodiversity measurements.
These postings will appear on the company’s website at www.ball.com/investors, under the link “Corporate Governance.” ​ Nothing on our website, including postings to the “Corporate Governance” and “Financials” pages, or the Ball Corporation Sustainability Report, or sections thereof, shall be deemed incorporated by reference into this annual report. ​
These postings will appear on the company’s website at www.ball.com/investors, under the link “Corporate Governance.” ​ Nothing on our website, including postings to the “Corporate Governance” and “Financials” pages, or the Ball Corporation Combined Annual and Sustainability Report, or sections thereof, shall be deemed incorporated by reference into this annual report. ​
In North and Central America, a diverse base of no fewer than ten global suppliers provide almost all of our aluminum can and end sheet requirements . ​ Beverage containers are sold based on price, quality, service, innovation and sustainability in a highly competitive market, which is relatively capital intensive and characterized by facilities that run more or less continuously in order to operate profitably.
In North and Central America, a diverse base of no fewer than seven global suppliers provide almost all of our aluminum can and end sheet requirements . ​ Beverage containers are sold based on price, quality, service, innovation and sustainability in a highly competitive market, which is relatively capital intensive and characterized by facilities that run more or less continuously in order to operate profitably.
In addition, Ball maintained a MSCI AA ESG rating, was included on the 2022 Dow Jones Sustainability Index, and was recognized as one of America’s Most Responsible Companies by Newsweek. ​ Human Capital and Employees ​ Ball Corporation’s people are its greatest asset and we are proud to outline the material aspects of our human capital program.
In addition, Ball maintained a MSCI AA ESG rating, was included on the 2023 Dow Jones Sustainability Index, and was recognized as one of America’s Most Responsible Companies by Newsweek. ​ Human Capital and Employees ​ Ball Corporation’s people are its greatest asset and we are proud to outline the material aspects of our human capital program.
We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ 9 Table of Contents Beverage Packaging, South America, Segment ​ The beverage packaging, South America, segment accounted for 14 percent of Ball’s consolidated net sales in 2022.
We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ 9 Table of Contents Beverage Packaging, South America, Segment ​ The beverage packaging, South America, segment accounted for 14 percent of Ball’s consolidated net sales in 2023.
Details of collective bargaining agreements are included within Item 1A, Risk Factors of this annual report. ​ Our Culture ​ Embracing our rich 143-year history, we “know who we are,” a company that respects and values each of our employees and their collective desire to deliver value to all our stakeholders.
Details of collective bargaining agreements are included within Item 1A, Risk Factors of this annual report. ​ Our Culture ​ Embracing our rich 144-year history, we “know who we are,” a company that respects and values each of our employees and their collective desire to deliver value to all our stakeholders.
Other R&D efforts in these segments seek to improve manufacturing efficiencies and the overall sustainability of our products. Our packaging R&D activities are primarily conducted in a technical center located in Westminster, Colorado. ​ In our aerospace business, we continue to focus our R&D activities on the design, development and manufacture of innovative aerospace products and systems.
Other R&D efforts in these segments seek to improve manufacturing efficiencies and the overall sustainability of our products. Our packaging R&D activities are primarily conducted in a technical center located in Westminster, Colorado. ​ In our aerospace business, R&D activities focus on the design, development and manufacture of innovative aerospace products and systems.
Our EMEA region operations include 17 facilities throughout Europe and one facility each in Cairo, Egypt, and Manisa, Turkey. In the third quarter of 2022, Ball completed the sale of its aluminum beverage packaging business located in Russia, which included three aluminum beverage can manufacturing facilities.
Our EMEA region operations include 19 facilities throughout Europe and one facility each in Cairo, Egypt, and Manisa, Turkey. In the third quarter of 2022, Ball completed the sale of its aluminum beverage packaging business located in Russia, which included three aluminum beverage can manufacturing facilities.
Aluminum beverage containers are primarily sold under multi-year supply contracts to fillers of carbonated soft drinks, beer, energy drinks and other beverages. ​ Aluminum beverage containers and ends are produced at 18 manufacturing facilities in the U.S., one in Canada and two in Mexico.
Aluminum beverage containers are primarily sold under multi-year supply contracts to fillers of carbonated soft drinks, beer, energy drinks and other beverages. ​ Aluminum beverage containers and ends are produced at 17 manufacturing facilities in the U.S., one in Canada and two in Mexico.
In addition, the aluminum beverage container competes aggressively with other packaging materials which include meaningful industry positions by the glass bottle in the packaged beer industry and the polyethylene terephthalate (PET) bottle in the carbonated soft drink and water industries. ​ We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in most of our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ Beverage Packaging, EMEA, Segment ​ The beverage packaging, EMEA, segment accounted for 25 percent of Ball’s consolidated net sales in 2022.
In addition, the aluminum beverage container competes aggressively with other packaging materials which include meaningful industry positions by the glass bottle in the packaged beer industry and the polyethylene terephthalate (PET) bottle in the carbonated soft drink and water industries. ​ We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in most of our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ Beverage Packaging, EMEA, Segment ​ The beverage packaging, EMEA, segment accounted for 24 percent of Ball’s consolidated net sales in 2023.
The company’s combined report and updates on Ball’s sustainability progress are available at www.ball.com/sustainability. ​ The company intends to post on its website the nature of any amendments to the company’s codes of ethics that apply to executive officers and directors, including the chief executive officer, chief financial officer and controller, and the nature of any waiver or implied waiver from any code of ethics granted by the company to any executive officer or director.
The company’s combined annual and sustainability report, and updates on Ball’s sustainability progress are available at www.ball.com/sustainability. ​ The company will post on its website the nature of any amendments to the company’s codes of ethics that apply to executive officers and directors, including the chief executive officer, chief financial officer and controller, and the nature of any waiver or implied waiver from any code of ethics granted by the company to any executive officer or director.
We also communicate company information through news releases, executive communications, digital signage and our weekly Ball eNews through the new BallConnect intranet, which are available to all employees. We have many recognition-oriented awards throughout our company, including our corporate and divisional awards of excellence, the Living Well Cup and global operations plant sustainability awards.
We also communicate company information through news releases, executive communications, social media, digital signage, our weekly Ball eNews and BallConnect intranet, which are available to all employees. We have many recognition-oriented awards throughout our company, including our corporate and divisional awards of excellence, the Living Well Cup and global operations plant sustainability awards.
Aligned with our Drive for 10 vision, the aluminum cups business leverages our years of experience and specialized expertise to provide another environmentally friendly offering to our industry-leading portfolio of aluminum packages. Sturdy, durable and cool to the touch, the infinitely recyclable Ball aluminum cup is produced at a dedicated manufacturing facility in Rome, Georgia.
Aligned with our vision, the aluminum cups business leverages our years of experience and specialized expertise to provide another environmentally friendly offering to our industry-leading portfolio of aluminum packages. Sturdy, durable and cool to the touch, the infinitely recyclable Ball aluminum cup is produced at a dedicated manufacturing facility in Rome, Georgia.
We manage our intellectual property portfolio to obtain the durations necessary to achieve our business objectives. ​ 11 Table of Contents Research and Development ​ Research and development (R&D) efforts in our packaging segments are primarily directed toward packaging innovation, specifically the development of new features, sizes, shapes and types of containers, as well as new uses for existing containers.
We manage our intellectual property portfolio to obtain the durations necessary to achieve our business objectives. ​ Research and Development ​ Research and development (R&D) efforts in our packaging segments are primarily directed toward packaging innovation, specifically the development of new features, sizes, shapes and types of containers, as well as new uses for existing containers.
In the case of aluminum cans, bottles or cups, which are monomaterial, the aluminum can be recycled and made back into the same product in as little as 60 days. In contrast, only 10 percent of all plastic ever produced has been recycled and is mostly only downcycled.
In the case of aluminum cans, bottles or cups, which are mono-material, the aluminum can be recycled and made back into the same product in as little as 60 days. In contrast, only 10 percent of all plastic ever produced has been recycled and is mostly only downcycled.
Over the past seven years, we have made meaningful 6 Table of Contents progress on D&I, which has been recognized by external organizations, including Forbes, which recognized Ball among “America’s Best Employers for Diversity” in 2019, the American Association of People with Disabilities (AAPD), which recognized Ball as a best place to work for disability inclusion on the 2022 Disability Equality Index, and the Human Rights Campaign Foundation, which listed Ball among the “Best Places to Work for LGBTQ Equality” in five out of the last six years, including a perfect score on its Corporate Equality Index list in 2021 and 2022.
Over the past eight years, we have made meaningful progress on D&I, which has been recognized by external organizations, including Forbes, which recognized Ball as #1 among “America’s Best Employers for Diversity” in 2019, the American Association of People with Disabilities (AAPD), which recognized Ball as a best place to work for disability inclusion on the 2022 Disability Equality Index, and the Human Rights Campaign Foundation, which listed Ball among the “Best Places to Work for LGBTQ Equality” in six out of the last seven years, including a perfect score on its Corporate Equality Index list in 2021 and 2022.
The EAP provides employees and their families access to mental health, stress management and other support resources essential to navigating life changes and challenges. ​ Additional information on our human capital programs can be found in the Ball Corporation Combined Report, which is available at www.ball.com/sustainability. ​ Our Reportable Segments ​ Ball Corporation reports its financial performance in four reportable segments: (1) beverage packaging, North and Central America; (2) beverage packaging, Europe, Middle East and Africa (beverage packaging, EMEA); (3) beverage packaging, South America and (4) aerospace.
In addition, the Employee Assistance Program provides employees and their families access to mental health, stress management and other support resources essential to navigating life changes and challenges. ​ Additional information on our human capital programs can be found in the Ball Corporation Combined Annual and Sustainability Report, which is available at www.ball.com/sustainability. ​ Our Reportable Segments ​ Ball Corporation reports its financial performance in four reportable segments: (1) beverage packaging, North and Central America; (2) beverage packaging, Europe, Middle East and Africa (beverage packaging, EMEA); (3) beverage packaging, South America and (4) aerospace.
Our commitment extends beyond our walls and includes purchasing aluminum from certified sustainable sources and reducing value chain emissions in order to facilitate achievement of Ball’s and its customers’ GHG reduction objectives. ​ Today’s consumers are choosing brands based on their sustainability and circularity credentials.
Our commitment extends beyond our walls and includes purchasing aluminum from Aluminum Stewardship Initiative (ASI) certified sustainable sources and reducing value chain emissions, all in order to facilitate achievement of Ball’s and its customers’ GHG reduction objectives. ​ Today’s consumers are choosing brands based on their sustainability and circularity credentials.
A focus on diversity among individuals and teams helps to unleash ideas and fuel innovation, which drives growth and economic value throughout our global organization. ​ A healthy and sustainable business also depends on thriving communities.
A focus on diversity and inclusion among individuals and teams helps to unleash ideas and fuel innovation, driving growth and economic value throughout our global organization. ​ A healthy and sustainable business also depends on thriving communities.
For the fourth year in a row, Ball received an A- score in CDP’s climate change program.
For the fifth year in a row, Ball received an A- score in CDP’s climate change program.
Our sustainable, aluminum packaging products are produced for a variety of end uses and are manufactured in facilities around the world. We also provide aerospace and other technologies and services to governmental and commercial customers within our aerospace segment. In 2022, our total consolidated net sales were $15.35 billion.
Our sustainable, aluminum packaging products are produced for a variety of end uses and are manufactured in facilities around the world. We also provide aerospace and other technologies and services to governmental and commercial customers within our aerospace segment. In 2023, our total consolidated net sales were $14.03 billion.
The 2022 backlog includes $1.52 billion expected to be recognized in revenues during 2023, with the remainder expected to be recognized in revenues in the years thereafter. Amounts included in backlog for certain firm government orders, which are subject to annual funding, were $1.61 billion and $1.05 billion at December 31, 2022 and 2021, respectively.
The 2023 backlog includes $1.67 billion expected to be recognized in revenues during 2024, with the remainder expected to be recognized in revenues in the years thereafter. Amounts included in backlog for certain firm government orders, which are subject to annual funding, were $1.72 billion and $1.61 billion at December 31, 2023 and 2022, respectively.
The aerosol packaging market in these countries shipped approximately 6.6 billion aluminum aerosol units in 2022 and we are one of the major producers in this combined area with shipments of 1.4 billion aluminum aerosol packaging containers, representing approximately 21 percent of total shipments in these markets. Our aluminum aerosol requirements are provided by several suppliers.
The aerosol packaging market in these countries shipped approximately 6.5 billion aluminum aerosol units in 2023 and we are one of the major producers in this combined area with shipments of 1.5 billion aluminum aerosol packaging containers, representing approximately 23 percent of total shipments in these markets. Our aluminum aerosol requirements are provided by several suppliers.
At the end of 2022, the company and its subsidiaries employed approximately 21,000 employees, including approximately 10,300 employees in the U.S.
At the end of 2023, the company and its subsidiaries employed approximately 21,000 employees, including approximately 10,000 employees in the U.S.
Uncertainties in the federal government budgeting process could delay the funding, or even result in cancellation of certain programs currently in our reported backlog. ​ Other ​ Other consists of a non-reportable operating segment (beverage packaging, other) that manufactures and sells aluminum beverage containers in India, Saudi Arabia and Myanmar; a non-reportable operating segment that manufactures and sells extruded aluminum aerosol containers, recloseable aluminum bottles across multiple consumer categories and slugs (aerosol packaging); a non-reportable operating segment that manufactures and sells aluminum cups (aluminum cups); undistributed corporate expenses; intercompany eliminations and other business activities. ​ Beverage Packaging, Other ​ Our aluminum beverage packaging operations in the beverage packaging, other, segment consist of four facilities – two in India and one each in Saudi Arabia and Myanmar.
Uncertainties in the federal government budgeting process could delay the funding, or even result in cancellation of certain programs currently in our reported backlog. ​ Other ​ Other consists of a non-reportable operating segment (beverage packaging, other) that manufactures and sells aluminum beverage containers in India, Saudi Arabia and Myanmar; a non-reportable operating segment that manufactures and sells extruded aluminum aerosol containers and recloseable aluminum bottles across multiple consumer categories as well as aluminum slugs (aerosol packaging) throughout North America, South America, Europe, and Asia; a non-reportable operating segment that manufactures and sells aluminum cups (aluminum cups); undistributed corporate expenses; and intercompany eliminations and other business activities. ​ 10 Table of Contents Beverage Packaging, Other ​ Our aluminum beverage packaging operations in the beverage packaging, other, segment consist of four facilities – two in India and one each in Saudi Arabia and Myanmar.
Five companies manufacture substantially all of the aluminum beverage containers in the U.S., Canada and Mexico. Ball shipped approximately 52 billion aluminum beverage containers in North and Central America in 2022, which represented approximately 37 percent of the aggregate shipments in these countries.
Five companies manufacture substantially all of the aluminum beverage containers in the U.S., Canada and Mexico. Ball shipped approximately 49 billion aluminum beverage containers in North and Central America in 2023, which represented approximately 36 percent of the aggregate shipments in these countries.
We embrace our diversity and are “one Ball” in valuing: ​ ● Uncompromising integrity; ● Being close to our customers; ● Behaving like owners; ● Focusing on attention to detail; and ● Being innovative. Diversity and Inclusion ​ Diversity and Inclusion (D&I) is embedded in our Drive for 10 vision and is key to the sustained success of our business.
We embrace our diversity and are “one Ball” in valuing: ​ ● Uncompromising integrity; ● Being close to our customers; ● Behaving like owners; ● Focusing on attention to detail; and ● Being innovative. 6 Table of Contents ​ Diversity and Inclusion ​ D&I is key to the sustained success of our business.
Four companies currently manufacture substantially all of the aluminum beverage containers in Brazil. ​ The company’s South American beverage facilities shipped approximately 19 billion aluminum beverage containers in 2022. Historically, sales volumes of beverage containers in South America tend to be highest during the period from September through December.
Four companies currently manufacture substantially all of the aluminum beverage containers in the regions served by our beverage packaging, South America, segment. ​ The company’s South American beverage facilities shipped approximately 19 billion aluminum beverage containers in 2023. Historically, sales volumes of beverage containers in South America tend to be highest during the period from September through December.
Using a new calculation implemented by the European Union (EU) in 2022, the overall recycling rate for aluminum beverage cans in the EU, Switzerland, Norway and Iceland was approximately 73 percent in 2020. ​ Raw material supply contracts in this region generally have longer term agreements. Six aluminum suppliers provide almost all of our aluminum can and end sheet requirements.
Using a new calculation implemented by the European Union (EU) in 2022, the overall recycling rate for aluminum beverage cans in the EU, Switzerland, Norway and Iceland was approximately 73 percent in 2020. ​ Raw material supply contracts in this region generally have longer term agreements.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, and in Note 3 to the consolidated financial statements within Item 8 of this Annual Report on Form 10-K (annual report). ​ Beverage Packaging, North and Central America, Segment ​ Beverage packaging, North and Central America, is Ball’s largest segment, accounting for 44 percent of consolidated net sales in 2022.
Additional financial information related to each of our segments is included in Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations, and in Note 3 to the consolidated financial statements within Item 8 of this Annual Report on Form 10-K (annual report). ​ Beverage Packaging, North and Central America, Segment ​ Beverage packaging, North and Central America, is Ball’s largest segment, accounting for 43 percent of consolidated net sales in 2023.
Ball also has investments in the U.S., Guatemala, Panama and Vietnam that are accounted for using the equity method of accounting and, accordingly, those results are not included in segment sales or earnings. Additional financial information related to each of our segments is included in Item 7.
Ball also has investments in the U.S., Guatemala, Panama and Vietnam that are accounted for using the equity method of accounting and, accordingly, those results are not included in segment sales or earnings.
Currently, 67 percent of our board of directors is either gender or ethnically diverse, including five female board members, and 44 percent of our company’s executive leadership team is either gender or ethnically diverse. ​ Talent ​ We seek to attract, develop and retain the best talent throughout the company.
Currently, 45 percent of our board of directors is gender diverse and 36 percent is ethnically diverse, and 44 percent of our company’s executive leadership team is gender diverse and 33 percent is ethnically diverse. ​ Talent ​ We seek to attract, develop and retain the best talent throughout the company.
Department of Defense (DoD), the National Aeronautics and Space Administration (NASA) and other U.S. government agencies. The company competes against both large and small prime contractors and subcontractors for these contracts.
Department of Defense (DoD), the National Aeronautics and Space Administration (NASA) and other U.S. government agencies. The company competes against both large and small prime contractors and subcontractors for these contracts. Contracts funded by the various agencies of the federal government represented 98 percent of segment sales in 2023.
We continue to evolve our talent acquisition process and focus on diversity for internships, candidate slates, interview panels, talent reviews and succession planning. Each of our business segment leaders has committed to help drive further D&I progress during 2023 and beyond.
We will also launch our Global Inclusion Council sponsored by our Chief Executive Officer and Chief Human Resource Officer. We continue to evolve our talent acquisition process and focus on diversity for internships, candidate slates, interview panels, talent reviews and succession planning. Each of our business segment leaders has committed to help drive further D&I progress during 2024 and beyond.
Our aerospace R&D activities are conducted at various locations in the U.S. ​ Additional information regarding company R&D activity is contained in Note 1 to the consolidated financial statements within Item 8 of this annual report, as well as in Item 2, Properties . ​ Where to Find More Information ​ Ball Corporation is subject to the reporting and other information requirements of the Securities Exchange Act of 1934, as amended (Exchange Act).
See Note 4 for further details. ​ Additional information regarding company R&D activity is contained in Note 1 to the consolidated financial statements within Item 8 of this annual report, as well as in Item 2, Properties . ​ 11 Table of Contents Where to Find More Information ​ Ball Corporation is subject to the reporting and other information requirements of the Securities Exchange Act of 1934, as amended (Exchange Act).
In South America, two suppliers provide virtually all our aluminum can and end sheet requirements with certain requirements also being imported from Asia. ​ We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ Aerospace Segment ​ Ball’s aerospace segment, which accounted for 13 percent of consolidated net sales in 2022, includes national defense hardware, antenna and video tactical solutions, civil and operational space hardware and systems engineering services.
In South America, two global suppliers provide virtually all our aluminum can and end sheet requirements with certain requirements also being imported from Asia. ​ We limit our exposure to changes in the cost of aluminum as a result of the inclusion of provisions in our aluminum beverage container sales contracts to pass through aluminum price changes, as well as through the use of derivative instruments. ​ Aerospace Segment ​ Ball’s aerospace segment, which accounted for 14 percent of consolidated net sales in 2023, provides aerospace and other technologies and services to governmental and commercial customers.
Our aluminum can and end sheet requirements are provided by several suppliers. Our manufacturing facility in Saudi Arabia, Ball United Arab Can Manufacturing Company, is an investment 51 percent owned by Ball and consolidated in our results. Additionally, Ball has ownership interests in an equity method investment in Vietnam. During 2021, Ball sold its minority-owned investment in South Korea.
Our aluminum can and end sheet requirements are provided by several suppliers. Our manufacturing facility in Saudi Arabia, Ball United Arab Can Manufacturing Company, is an investment 51 percent owned by Ball and consolidated in our results.
Our packaging businesses were responsible for 87 percent of our net sales, with the remaining 13 percent contributed by our aerospace business. ​ Our largest product line is aluminum beverage containers and we also produce extruded aluminum aerosol containers, recloseable aluminum bottles across multiple consumer categories, aluminum slugs and aluminum cups. ​ We sell our aluminum packaging products globally to large multinational beverage, personal care and household products companies with which we have developed long-term relationships.
See Note 4 for further details. ​ Our largest product line is aluminum beverage containers and we also produce extruded aluminum aerosol containers, recloseable aluminum bottles across multiple consumer categories, aluminum slugs and aluminum cups. ​ We sell our aluminum packaging products globally to large multinational beverage, personal care and household products companies with which we have developed long-term relationships.
Both facilities are expected to begin production in the first half of 2023. ​ Historically, sales volumes of metal beverage containers in EMEA tend to be highest during the period from May through August, with a smaller increase in demand leading up to the winter holiday season in the U.K.
During 2023, the company began production at its new aluminum beverage can manufacturing facilities in Pilsen, Czech Republic, and Kettering, U.K. ​ Historically, sales volumes of metal beverage containers in EMEA tend to be highest during the period from May through August, with a smaller increase in demand leading up to the winter holiday season in the U.K.
For the countries where we operate, the South American beverage container market is approximately 40 billion containers, and we are the largest producer in this region with an estimated 46 percent of South American shipments in 2022.
Our operations consist of 12 facilities—9 in Brazil and one each in Argentina, Chile and Paraguay. For the countries where we operate, the South American beverage container market is approximately 41 billion containers, and we are the largest producer in this region with an estimated 47 percent of South American shipments in 2023.
We continue to invest in recruiting to ensure we have the right people with the right skills in the right roles, and in developing our employees at every level and providing them with opportunities to advance their careers. We also are committed to embracing diversity and providing an inclusive environment where employees can thrive.
We continue to invest in hiring, training and retaining our employees at every level across the organization to ensure we have the right people with the right skills in the right roles, and are providing them with opportunities to advance their careers.
The beverage packaging, North and Central America, segment also includes interests in three investments that are accounted for using the equity method. In the third quarter of 2022, Ball announced the permanent closure of its aluminum beverage can manufacturing facilities in Phoenix, Arizona, and St. Paul, Minnesota.
The beverage packaging, North and Central America, segment also includes interests in three investments that are accounted for using the equity method. Ball permanently ceased production at its aluminum beverage can 8 Table of Contents manufacturing facility in St.
For the countries in which we currently operate, not including Russia, the beverage container market is approximately 90 billion containers, and we are the largest producer with an estimated 39 percent of shipments in this region.
For the countries in which we currently operate, the beverage container market is approximately 90 billion containers, and we are the largest producer with an estimated 38 percent of shipments in this region. The regions served by our beverage packaging, EMEA, segment, including Egypt and Turkey, are highly regional in terms of sales growth rates and packaging mix.
The compensation of many of our employees is tied directly to the company’s performance through our EVA®-based incentive programs. ​ Sustainability and Circularity ​ At Ball Corporation, we believe in our people, our culture and our ability to deliver value to our stakeholders.
The compensation of many of our employees is tied directly to the company’s performance through our EVA®-based incentive programs. ​ 4 Table of Contents Sustainability ​ At Ball Corporation, we deliver circular aluminum packaging solutions.
The data captured through Ball built instruments and satellites enable and enhance understanding of the Earth’s ecosystem and help scientists to pinpoint more accurately what type of GHGs and pollutants are being emitted, where they are coming from, and a precise idea of where they are moving. ​ At Ball our sustained long-term success depends not only on our products and our operations, but on an engaged workforce.
The data captured through Ball 5 Table of Contents built instruments and satellites enable and enhance understanding of the Earth’s ecosystem and help scientists to pinpoint more accurately what type of GHGs and pollutants are being emitted, where they are coming from, and a precise idea of where they are moving. ​ At Ball, we believe our people and our culture enable our success and make it possible for us to deliver on our promises to customers, investors, communities and all of our stakeholders.
These five levers are: ​ ● Maximizing value in our existing businesses ● Expanding into new products and capabilities ● Aligning ourselves with the right customers and markets ● Broadening our geographic reach and ● Leveraging our know-how and technological expertise to provide a competitive advantage ​ We also maintain a clear and disciplined financial strategy focused on improving shareholder returns by: ​ ● Seeking to deliver comparable diluted earnings per share growth of 10 percent to 15 percent per annum over the long-term ● Maximizing cash flow generation ● Increasing Economic Value Added (EVA®) dollars ​ 4 Table of Contents The cash generated by our businesses is used primarily: (1) to finance the company’s operations, (2) to fund growth capital investments, (3) to service the company’s debt and (4) to return value to our shareholders via stock buybacks and dividend payments.
Maintain a clear and disciplined financial strategy focused on executing an efficient operating model to deliver comparable diluted earnings per share growth of 10 percent to 15 percent per annum over the long-term, maximize cash flow, increase Economic Value Added (EVA®) dollars and return value to shareholders. ​ The cash generated by our businesses is used primarily: (1) to finance the company’s operations, (2) to fund growth capital investments, (3) to service the company’s debt and (4) to return value to our shareholders via stock buybacks and dividend payments.
The company minimizes its exchange rate risk using derivative and supply contracts in local currencies.
Six global aluminum suppliers provide almost all of our aluminum can and end sheet requirements. The company minimizes its exchange rate risk using derivative and supply contracts in local currencies.
Backlog in the aerospace segment was $2.97 billion and $2.47 billion at December 31, 2022 and 2021, respectively, and consisted of the aggregate contract value of firm orders, excluding amounts previously recognized as revenue.
See Note 4 for further details. ​ Backlog represents the estimated transaction prices on performance obligations to our customers for which work remains to be performed. Backlog in the aerospace segment was $2.98 billion and $2.97 billion at December 31, 2023 and 2022, respectively, and consisted of the aggregate contract value of firm orders, excluding amounts previously recognized as revenue.
This includes the production of spacecraft, instruments and sensors, radio frequency and system components, data exploitation solutions and a variety of advanced aerospace technologies and products that enable deep space missions.
This includes the production of spacecraft, instruments and sensors, radio frequency and system components, data exploitation solutions and a variety of advanced aerospace technologies and products that enable deep space missions. Our aerospace R&D activities are conducted at various locations in the U.S. In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc.
The regions served by our beverage packaging, EMEA, segment, including Egypt and Turkey, are highly regional in terms of sales growth rates and packaging mix. Four companies manufacture substantially all of the metal beverage containers in EMEA. Our EMEA beverage facilities, not including Russia, shipped 35 billion beverage containers in 2022, all of which were made from aluminum.
Four companies manufacture substantially all of the metal beverage containers in EMEA. Our EMEA beverage facilities, shipped 35 billion beverage containers in 2023, all of which were made from aluminum.
For additional details, refer to Note 4 to the consolidated financial statements within Item 8 of this annual report ​ Aerosol Packaging ​ Our aluminum aerosol packaging operations manufacture and sell extruded aluminum aerosol containers, recloseable aluminum bottles across multiple consumer categories and aluminum slugs, which represented less than 5 percent of Ball’s consolidated net sales in 2022.
Additionally, Ball has ownership interests in an equity method investment in Vietnam. ​ Aerosol Packaging ​ Our aluminum aerosol packaging operations manufacture and sell extruded aluminum aerosol containers, recloseable aluminum bottles across multiple consumer categories, and aluminum slugs, which represented less than 5 percent of Ball’s consolidated net sales in 2023.
In 2022 Ball and its employees donated over $8 million supporting more than 2,800 non-profit organizations and logged more than 30,000 hours of volunteer service to non-profit organizations centered on building sustainable communities through recycling, education, and disaster preparedness and relief initiatives. ​ The company’s focus towards sustainability has been recognized by external organizations.
Through the Ball Foundation, corporate giving, employee giving and volunteerism, we invest in the future of the communities that sustain us. Each year Ball and its employees donate, volunteer and support non-profit organizations centered on building sustainable communities through recycling, education, and disaster preparedness and relief initiatives. ​ The company’s focus towards sustainability has been recognized by external organizations.
It produces spacecraft, instruments and sensors, radio frequency systems and components, data exploitation solutions and a variety of advanced technologies and products that enable weather prediction and climate change monitoring as well as deep space missions. ​ We are headquartered in Westminster, Colorado, and our stock is listed for trading on the New York Stock Exchange under the ticker symbol BALL. ​ Our Strategy ​ Our Drive for 10 vision defines our overall business strategy.
It produces spacecraft, instruments and sensors, radio frequency systems and components, data exploitation solutions and a variety of advanced technologies and products that enable weather prediction and climate change monitoring as well as deep space missions. In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc.
The Phoenix facility ceased production in the fourth quarter of 2022, and the St. Paul facility ceased production in the first quarter of 2023. ​ 8 Table of Contents According to publicly available information and company estimates, the North American beverage container industry represents approximately 140 billion units.
Additionally, in the fourth quarter of 2023, the company announced that it will permanently cease production at its aluminum beverage can manufacturing facility in Kent, Washington in the first half of 2024. ​ According to publicly available information and company estimates, the North American beverage container industry represents approximately 136 billion units.
We conduct regular company-wide engagement surveys, as well as periodic pulse surveys, which have generally indicated high levels of engagement and trust in Ball’s leadership, key strategies and initiatives. ​ Total Rewards ​ We have steadily upgraded our total rewards function over the past decade with the ongoing objective of acquiring, rewarding and retaining the best talent by providing total rewards that are competitive and performance based.
We conduct regular company-wide engagement surveys, as well as periodic pulse surveys, which have generally indicated high levels of engagement and trust in Ball’s leadership, key strategies and initiatives. ​ Total Rewards ​ Our global total rewards philosophy enables business performance by offering comprehensive total rewards that attract, retain, and motivate our employees and promote their overall wellbeing.
Over the past 15 years, we have sponsored a variety of health and wellness programs designed to enhance the physical and mental well-being of our employees around the world. During 2020, the company expanded access to its existing Employee Assistance Program (EAP) to our entire global workforce.
We sponsor a variety of health and wellness programs designed to enhance the physical and mental well-being of our employees around the world.
At any time, we may be engaged in discussions or negotiations with respect to possible transactions or may have entered into non-binding letters of intent. There can be no assurance if or when we will enter into any such transactions or the terms of such transactions.
At any time, we may be engaged in discussions or negotiations at various stages of development with respect to one or more possible transactions or may have entered into non-binding letters of intent. As part of any such initiatives, we may participate in processes being run by other companies or leading our own activities.
There are 9 manufacturing facilities that manufacture these products – four in Europe and one each in the U.S., Canada, Brazil, Mexico and India.
There are 8 manufacturing facilities that manufacture these products – four in Europe and one each in Canada, Brazil, Mexico and India. As a result of a plant fire, Ball permanently ceased production at its extruded aluminum slug manufacturing facility in Verona, Virginia, in the third quarter of 2023.
We work together to create effective collection and recycling systems and educate consumers about the sustainability and circularity benefits of aluminum packaging. During 2022 the company proactively supported further expansion of Deposit Return Systems 5 Table of Contents (DRS) and Extended Producer Responsibility (EPR) programs in several regions.
We work together to create effective collection and recycling systems, and educate consumers about the sustainability and circularity benefits of aluminum packaging. ​ Our aerospace business plays a role in sustainability as well.
Sustainability and circularity constitute a key part of our business strategy and influence how we manage and operate our businesses, serve our customers, care for the environment and our communities, secure profits and drive long-term prosperity. ​ We focus our sustainability and circularity efforts on environmental, social and governance (ESG) impacts through the lenses of product stewardship and social impacts, exhibited through our commitment to achieve a science-based 55 percent reduction in our greenhouse gas (GHG) footprint by 2030 and net zero carbon emissions prior to 2050, as well as human capital management, including diversity and inclusion, and community engagement.
Climate leadership and driving real circularity are cornerstones of our business strategy and influence how we manage and operate our businesses, serve our customers, care for the environment and our communities, secure profits and drive long-term prosperity. ​ We focus our sustainability efforts on environmental, social and governance (ESG) impacts.
Our operations consist of 12 facilities—9 in Brazil and one each in Argentina, Chile and Paraguay. In the third quarter, Ball permanently ceased operations at its aluminum beverage can manufacturing facility in Santa Cruz, Brazil, and temporarily reduced production across its remaining Brazilian beverage can manufacturing footprint.
Paul, Minnesota in the first quarter of 2023 and permanently ceased production at its aluminum beverage can manufacturing facility in Wallkill, New York in the third quarter of 2023.
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At its highest level, Drive for 10 is a mindset around perfection, with a greater sense of urgency around our future success. Launched in 2011, Drive for 10 encompasses five strategic levers that are key to growing our businesses and achieving long-term success.
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Our packaging businesses were responsible for 86 percent of our net sales, with the remaining 14 percent contributed by our aerospace business. In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc. (BAE), to sell all of the outstanding equity interests in Ball’s aerospace business to BAE.
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Like uncompromising integrity and customer focus, sustainability and circularity are part of our Drive for 10 vision and have been a part of who we are since our founding in 1880. ​ Our triple bottom-line approach to sustainability – environmental, economic and social – has evolved over the past 20 years and, together with our objective of providing truly circular economic solutions for our customers, is the lens through which we continue to conduct business at every level of our organization.
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On February 16, 2024, the company completed the divestiture of the aerospace business.
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In our manufacturing operations around the world, we work on continuous improvement of employee safety and engagement, energy and water efficiency, reducing greenhouse gas emissions, waste reduction and recycling.
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(BAE), to sell all of the outstanding equity interests in Ball’s aerospace business to BAE. On February 16, 2024, the company completed the divestiture of the aerospace business.
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For example, Colorado signed an EPR program into law in 2022 requiring companies who sell packaging products to fund a statewide recycling system to recycle those materials. ​ Our aerospace business plays a role in sustainability as well.
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See Note 4 for further details. ​ We are headquartered in Westminster, Colorado, and our stock is listed for trading on the New York Stock Exchange under the ticker symbol BALL. ​ Our Strategy ​ Advance sustainable aluminum packaging solutions at scale by leveraging our world-class talent, customer and supply chain partnerships, innovative product portfolio and capable manufacturing footprint to deliver single-use, limited-use and reusable aluminum cans, bottles and cups.
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Through the Ball Foundation, corporate giving, employee giving and volunteerism, we invest in the future of the communities that sustain us.
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Our business is aligned around cohesive operating priorities focused on constant innovation, product capabilities, sustainability and financial stewardship. ​ Our approach to sustainability has evolved over the past 20 years. Today, Ball’s sustainability strategy is driven by high standards around carbon footprint reduction, the circularity of our products and closed-loop recycling.
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Our focus to date has been on providing unconscious bias training for our global workforce, continuing to expand our Ball Network and Interest Groups (BNIs) in terms of quantity and geography and increasing awareness about the importance of D&I and each employee’s role in ensuring that we have a culture where people can bring their authentic selves to work and thrive.
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Utilizing strategic partnerships, we work across the value chain towards our 2030 Sustainability Goals in line with our customers’ needs.
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While we are proud of our progress, we know there is more work to do. ​ As we move forward, we are accelerating our D&I efforts with a sense of urgency.
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This is exhibited through our Climate Transition Plan commitment to achieve a science-based 55 percent reduction in our greenhouse gas (GHG) footprint by 2030 and net zero carbon emissions prior to 2050, in part by reaching 100 percent renewable electricity globally by 2030.
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Going into 2023, we plan to introduce tools for inclusion in our learning management system to enhance the unconscious bias training we provide to our global workforce.
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In addition, our focus on the health and safety of our employees, diversity and inclusion (D&I), and employee development enables Ball to utilize the unmatched talent of our people to maintain an agile workforce. ​ Our innovation and manufacturing teams around the world focus on continuously improving operational efficiency.
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We will also enhance the purpose and mission of our BNIs to better serve overall business objectives and will be preparing to launch an Inclusion Council led by our Vice President of Diversity and Inclusion and sponsored by our Chief Executive Officer and Chief Human Resources Officer.
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This focus drives improved processes, including products designed for optimum metal efficiency, real time energy monitoring, and reuse of water, as well as the minimization of waste and spoilage within our manufacturing plants.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCOVID-19 and its related variants, or another different future pandemic, could give rise to circumstances that cause one or more of the following risk factors to occur: ​ ● We could lose key customers, customers could become insolvent or have a reduction in demand for our products and services; ● We could be subject to changes in laws and governmental regulations that adversely affect our business and operations; ● We could be subject to adverse fluctuations in currency exchange rates; ● We might lose key management and operating personnel; ● We may be subject to disruptions in the supply or price of our raw materials; ● We may face prolonged work stoppages at our facilities; ● We may be impacted by government budget constraints or government shutdowns; ● Our pension plan investments may not perform as expected, and we may be required to make additional contributions to our pension plans which would otherwise be available for other general corporate purposes; ● Our access to capital markets may be restricted, which could adversely affect our short-term liquidity and prevent us from fulfilling our obligations under the notes issued pursuant to our bond indentures; ● We may be subject to increased information technology (IT) security threats and reduced network access availability; ● Our operations and those of our principal customers and suppliers could be designated as non-essential in key markets; and ● A material weakness in our internal control over financial reporting or a material misstatement in our financial statements could occur. ​ Because the COVID-19 pandemic is far-reaching and its impacts cannot be completely anticipated, additional risks may arise that could materially impact the company’s financial results and liquidity. ​ The company has or may implement actions to minimize the risks and associated negative effects from COVID-19, which do not guarantee the prevention or mitigation of material impacts on our business.
Biggest changeAs of December 31, 2023, the company had no material weaknesses. 16 Table of Contents ​ We face risks related to health epidemics, pandemics and other outbreaks, which could adversely affect our business. ​ Health epidemics, pandemics and other outbreaks could give rise to circumstances that cause one or more of the following risk factors to occur: ​ ● We could lose key customers, customers could become insolvent or have a reduction in demand for our products and services; ● We could be subject to changes in laws and governmental regulations that adversely affect our business and operations; ● We could be subject to adverse fluctuations in currency exchange rates; ● We might lose key management and operating personnel; ● We may be subject to disruptions in the supply or price of our raw materials; ● We may face prolonged work stoppages at our facilities; ● We may be impacted by government budget constraints or government shutdowns; ● Our pension plan investments may not perform as expected, and we may be required to make additional contributions to our pension plans which would otherwise be available for other general corporate purposes; ● Our access to capital markets may be restricted, which could adversely affect our short-term liquidity and prevent us from fulfilling our obligations under the notes issued pursuant to our bond indentures; ● We may be subject to increased information technology (IT) security threats and reduced network access availability; ● Our operations and those of our principal customers and suppliers could be designated as non-essential in key markets; and ● A material weakness in our internal control over financial reporting or a material misstatement in our financial statements could occur. ​ Governmental and regulatory risks ​ Changes in laws and governmental regulations may adversely affect our business and operations. ​ We and our customers and suppliers are subject to various federal, state, provincial and local laws and regulations, which have been increasing in number and complexity.
Increases in productivity, combined with potential surplus capacity in the industry, have maintained competitive pricing pressures. The principal methods of competition in the general packaging industry are price, innovation, sustainability, service and quality. In the aerospace industry, they are technical capability, cost and schedule.
Increases in productivity, combined with potential surplus capacity in the packaging industry, have maintained competitive pricing pressures. The principal methods of competition in the general packaging industry are price, innovation, sustainability, service and quality. In the aerospace industry, they are technical capability, cost and schedule.
This could result in increases to our contributions to the plans as well as pension expense. ​ 16 Table of Contents Restricted access to capital markets could adversely affect our short-term liquidity and prevent us from fulfilling our obligations under the notes issued pursuant to our bond indentures. ​ A reduction in global market liquidity could: ​ ● restrict our ability to fund working capital, capital expenditures, research and development expenditures and other business activities; ● increase our vulnerability to general adverse economic and industry conditions, including the credit risks stemming from the economic environment; ● limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate; ● restrict us from making strategic acquisitions or exploiting business opportunities; and ● limit, along with the financial and other restrictive covenants in our debt, among other things, our ability to borrow additional funds, dispose of assets, pay cash dividends or refinance debt maturities. ​ If market interest rates increase, our variable-rate debt will create higher debt service requirements, which adversely affects our cash flows.
This could result in increases to our contributions to the plans as well as pension expense. ​ 15 Table of Contents Restricted access to capital markets could adversely affect our short-term liquidity and prevent us from fulfilling our obligations under the notes issued pursuant to our bond indentures. ​ A reduction in global market liquidity could: ​ ● restrict our ability to fund working capital, capital expenditures, research and development expenditures and other business activities; ● increase our vulnerability to general adverse economic and industry conditions, including the credit risks stemming from the economic environment; ● limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate; ● restrict us from making strategic acquisitions or exploiting business opportunities; and ● limit, along with the financial and other restrictive covenants in our debt, among other things, our ability to borrow additional funds, dispose of assets, pay cash dividends or refinance debt maturities. ​ If market interest rates increase, our variable-rate debt and any need to refinance debt will create higher debt service requirements, which adversely affects our cash flows.
The fixed-price contracts could subject us to losses if we have cost overruns or if increases in our costs exceed the applicable escalation rate. ​ Net earnings and net assets could be materially affected by an impairment of goodwill. ​ We have a significant amount of goodwill recorded on our consolidated balance sheet as of December 31, 2022.
The fixed-price contracts could subject us to losses if we have cost overruns or if increases in our costs exceed the applicable escalation rate. ​ Net earnings and net assets could be materially affected by an impairment of goodwill. ​ We have a significant amount of goodwill recorded on our consolidated balance sheet as of December 31, 2023.
The compliance costs associated with current and proposed laws and potential regulations could be substantial, and any failure or alleged failure to comply with these laws or regulations could lead to litigation or governmental action, all of which could adversely affect our financial condition or results of operations. ​ Our aerospace segment is subject to certain risks specific to that business. ​ In our aerospace business, U.S. government contracts are subject to reduction or modification in the event of changes in requirements, and the government may also terminate contracts at its convenience pursuant to standard termination provisions.
The compliance costs associated with current and proposed laws and potential regulations could be substantial, and any failure or alleged failure to comply with these laws or regulations could lead to litigation or governmental action, all of which could adversely affect our financial condition or results of operations. ​ 17 Table of Contents Our aerospace segment is subject to certain risks specific to that business. ​ In our aerospace business, U.S. government contracts are subject to reduction or modification in the event of changes in requirements, and the government may also terminate contracts at its convenience pursuant to standard termination provisions.
There can be no assurance that our products will successfully compete against alternative products, which could result in a reduction in our profits or cash flows. ​ Our packaging businesses have a narrow product range, and our business would suffer if usage of our products decreased or if decreases occur in the demand for the beverages and other goods filled in our products. ​ The majority of our consolidated net sales were from the sale of beverage containers, and we expect to derive a significant portion of our future revenues and cash flows from the sale of beverage containers.
There can be no assurance that our products will successfully compete against alternative products, which could result in a reduction in our profits or cash flows. ​ 13 Table of Contents Our packaging businesses have a narrow product range, and our business would suffer if usage of our products decreased or if decreases occur in the demand for the beverages and other goods filled in our products. ​ The majority of our consolidated net sales were from the sale of beverage containers, and we expect to derive a significant portion of our future revenues and cash flows from the sale of beverage containers.
In addition, a security breach that involves classified or other sensitive government information could subject us to civil or criminal penalties and could result in the loss of our secure facility clearance and other accreditation, loss of our government contracts, loss of access to classified information or debarment as a government contractor. ​ Human capital risks ​ If we fail to retain key management and personnel, we may be unable to implement our key objectives. ​ We believe our future success depends, in part, on our experienced management team.
In addition, a security breach that involves classified or other sensitive government information could subject us to civil or criminal penalties and could result in the loss of our secure facility clearance and other accreditation, loss of our government contracts, loss of access to classified information or debarment as a government contractor. ​ 19 Table of Contents Human capital risks ​ If we fail to retain key management and personnel, we may be unable to implement our key objectives. ​ We believe our future success depends, in part, on our experienced management team.
While the company believes its estimates of its tax obligations are reasonable, the final outcome after the conclusion of any tax examinations and any litigation could be materially different from what has been reflected in the company’s historical financial statements. ​ 20 Table of Contents Technological risks ​ Decreases in our ability to develop or apply new technology and know-how may affect our competitiveness. ​ Our success depends partially on our ability to improve production processes and services.
While the company believes its estimates of its tax obligations are reasonable, the final outcome after the conclusion of any tax examinations and any litigation could be materially different from what has been reflected in the company’s historical financial statements. ​ Technological risks ​ Decreases in our ability to develop or apply new technology and know-how may affect our competitiveness. ​ Our success depends partially on our ability to improve production processes and services.
Due to these and other factors, overall spending on various programs could decline, which could result in significant reductions to revenue, cash flows, net earnings and backlog primarily in our aerospace segment. ​ 19 Table of Contents As a U.S. government contractor, we could be adversely affected by changes in regulations or any negative findings from a U.S. government audit or investigation. ​ Our aerospace business operates in a highly regulated environment and is routinely audited and reviewed by the U.S. government and its agencies, such as the Defense Contract Audit Agency (DCAA) and Defense Contract Management Agency (DCMA).
Due to these and other factors, overall spending on various programs could decline, which could result in significant reductions to revenue, cash flows, net earnings and backlog primarily in our aerospace segment. ​ As a U.S. government contractor, we could be adversely affected by changes in regulations or any negative findings from a U.S. government audit or investigation. ​ Our aerospace business operates in a highly regulated environment and is routinely audited and reviewed by the U.S. government and its agencies, such as the Defense Contract Audit Agency (DCAA) and Defense Contract Management Agency (DCMA).
In addition, we cannot ensure that upon the expiration of existing collective bargaining agreements, new agreements will be reached without union action or that any such new agreements will be on terms satisfactory to us. ​ 21 Table of Contents Environmental risks ​ Adverse weather and climate changes may result in lower sales. ​ We manufacture packaging products primarily for beverages.
In addition, we cannot ensure that upon the expiration of existing collective bargaining agreements, new agreements will be reached without union action or that any such new agreements will be on terms satisfactory to us. ​ Environmental risks ​ Adverse weather and climate changes may result in lower sales. ​ We manufacture packaging products primarily for beverages.
Risk Factors ​ Any of the following risks could materially and adversely affect our business, results of operations, cash flows and financial condition. ​ 12 Table of Contents General Risks ​ If we do not effectively manage change and growth, our business could be adversely affected. ​ Our future revenue and operating results will depend on our ability to effectively manage the anticipated growth of our business.
Risk Factors ​ Any of the following risks could materially and adversely affect our business, results of operations, cash flows and financial condition. ​ General Risks ​ If we do not effectively manage change and growth, our business could be adversely affected. ​ Our future revenue and operating results will depend on our ability to effectively manage the anticipated growth of our business.
To mitigate these risks, the Company is working with its suppliers to require them to remove PFAS-containing coatings from our products. ​ Earnings and cash flows can be impacted by changes in tax laws. ​ As a U.S.-based multinational business, the company is subject to income tax in the U.S. and numerous jurisdictions outside the U.S., including recent OECD, European Commission and other trans-national initiatives that seek to impose minimum tax thresholds on most multi-national companies.
To mitigate these risks, the Company is working with its suppliers to require them to remove PFAS-containing coatings from our products. 18 Table of Contents ​ Earnings and cash flows can be impacted by changes in tax laws. ​ As a U.S.-based multinational business, the company is subject to income tax in the U.S. and numerous jurisdictions outside the U.S., as well as recent OECD, European Commission and other trans-national initiatives that seek to impose minimum tax thresholds on most multi-national companies.
Moreover, overcapacity, which often leads to lower prices, may develop over time in certain regions in which we operate even if demand continues to grow. More generally, supply and demand fluctuations could make it difficult for us to forecast and meet certain customers’ needs.
Moreover, overcapacity, which often leads to lower prices, may develop over time in certain regions in which we operate even if demand continues to grow. More generally, supply and demand fluctuations could make it difficult for us to forecast and meet certain customers’ 12 Table of Contents needs.
Unforeseen losses of key members of our management team without appropriate succession and/or compensation planning could make it difficult for us to manage our business and meet our objectives. ​ Prolonged work stoppages at facilities with union employees could jeopardize our financial position. ​ As of December 31, 2022, 9 percent of our North American employees and 38 percent of our European employees were covered by collective bargaining agreements.
Unforeseen losses of key members of our management team without appropriate succession and/or compensation planning could make it difficult for us to manage our business and meet our objectives. ​ Prolonged work stoppages at facilities with union employees could jeopardize our financial position. ​ As of December 31, 2023, 8 percent of our North American employees and 39 percent of our European employees were covered by collective bargaining agreements.
GAAP net earnings and net assets. ​ If the investments in Ball’s pension plans, or in the multi-employer pension plans in which Ball participates, do not perform as expected, we may have to contribute additional amounts to the plans, which would otherwise be available for other general corporate purposes. ​ Ball maintains defined benefit pension plans covering substantially all of its employees in the United States and a significant number of United Kingdom deferred and retired participants, which are funded based on certain actuarial assumptions.
GAAP net earnings and net assets. ​ If the investments in Ball’s pension plans, or in the multi-employer pension plans in which Ball participates, do not perform as expected, we may have to contribute additional amounts to the plans, which would otherwise be available for other general corporate purposes. ​ Ball maintains defined benefit pension plans covering substantially all of its employees in the United States, which are funded based on certain actuarial assumptions.
If demand for glass and PET bottles increases relative to aluminum containers, or the demand for aluminum containers does not develop as expected, our business, results of operations, cash flows and financial condition could be materially adversely affected. ​ 14 Table of Contents Our business, financial condition, cash flows and results of operations are subject to risks resulting from broader geographic operations. ​ We derived approximately 45 percent of our consolidated net sales from outside of the U.S. for the year ended December 31, 2022.
If demand for glass and PET bottles increases relative to aluminum containers, or the demand for aluminum containers does not develop as expected, our business, results of operations, cash flows and financial condition could be materially adversely affected. ​ Our business, financial condition, cash flows and results of operations are subject to risks resulting from broader geographic operations. ​ We derived approximately 44 percent of our consolidated net sales from outside of the U.S. for the year ended December 31, 2023.
Reasons for this include, but are not limited to, the following: ​ ● political and economic instability; ● governments’ restrictive trade policies; ● the imposition or rescission of duties, taxes or government royalties; ● exchange rate risks; ● inflation of direct input costs; ● virus and disease outbreaks and responses thereto; ● difficulties in enforcement of contractual obligations and intellectual property rights; and ● the geographic, language and cultural differences between personnel in different areas of the world. ​ We are exposed to exchange rate fluctuations. ​ The company’s financial results are exposed to currency exchange rate fluctuations and a significant proportion of assets, liabilities and earnings denominated in non-U.S. dollar currencies.
Reasons for this include, but are not limited to, the following: ​ ● political and economic instability; ● governments’ restrictive trade policies; ● the imposition or rescission of duties, taxes or government royalties; ● exchange rate risks; ● inflation of direct input costs; ● virus and disease outbreaks and responses thereto; and ● difficulties in enforcement of contractual obligations and intellectual property rights. ​ We are exposed to exchange rate fluctuations. ​ The company’s financial results are exposed to currency exchange rate fluctuations and a significant proportion of assets, liabilities and earnings are denominated in non-U.S. dollar currencies.
Our contracts with these customers are subject to several risks, including funding cuts and delays, technical uncertainties, budget changes, government shutdowns, competitive activity and changes in scope. 13 Table of Contents ​ We have a significant level of debt that could have important consequences for our business and any investment in our securities. ​ The company had $9.00 billion of interest-bearing debt at December 31, 2022.
Our contracts with these customers are subject to several risks, including funding cuts and delays, technical uncertainties, budget changes, government shutdowns, competitive activity and changes in scope. ​ We have a significant level of debt that could have important consequences for our business and any investment in our securities. ​ The company had $8.62 billion of interest-bearing debt at December 31, 2023.
The plans’ assets consist primarily of common stocks, fixed-income securities and, in the U.S., alternative investments.
The plans’ assets consist primarily of common stocks, fixed-income securities and alternative investments.
Certain IT-related risks may be heightened due to the transitional support we are providing to the Russian beverage packaging business since its sale to Russian owners in September 2022. ​ While we attempt to mitigate all of these risks to our networks, systems and data by employing a number of measures, including employee training, comprehensive monitoring of our networks and systems, and maintenance of backup and protective systems, our systems, networks, products, solutions and services remain potentially vulnerable to advanced persistent threats or other IT disruptions.
The company has a number of shared service centers where many of the company’s IT systems are concentrated and any disruption at such a location could impact the company’s business within the operating zones served by the impacted service center. ​ While we attempt to mitigate all of these risks to our networks, systems and data by employing a number of measures, including employee training, comprehensive monitoring of our networks and systems, and maintenance of backup and protective systems, our systems, networks, products, solutions and services remain potentially vulnerable to advanced persistent threats or other IT disruptions.
In addition, in view of recent increases in our raw material and other production costs, we initiated a comprehensive cost pass-through program across all our businesses beginning in the second half of 2021, which is ongoing, to seek to recover from our customers the full amount of those cost increases over time. 15 Table of Contents We use estimates in accounting for many of our programs in our aerospace business, and changes in our estimates could adversely affect our future financial results. ​ We account for sales and profits on a portion of long-term contracts in our aerospace business in accordance with the percentage-of-completion method of accounting, using the cost-to-cost method to account for updates in estimates.
The delayed timing in recovering the pass-through of increasing raw material costs may also impact our short-term 14 Table of Contents profitability and certain costs due to price increases or supply chain inefficiencies may be unrecoverable, which would also impact our profitability. ​ We use estimates in accounting for many of our programs in our aerospace business, and changes in our estimates could adversely affect our future financial results. ​ We account for sales and profits on a portion of long-term contracts in our aerospace business in accordance with the percentage-of-completion method of accounting, using the cost-to-cost method to account for updates in estimates.
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Due to the fixed-price contracts, increased prices could decrease our sales volume over time. The delayed timing in recovering the pass-through of increasing raw material costs may also impact our short-term profitability and certain costs due to price increases or supply chain inefficiencies may be unrecoverable, which would also impact our profitability.
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Due to the fixed-price contracts, increased prices could decrease our sales volume over time.
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As of December 31, 2022, the company had no material weaknesses. 17 Table of Contents We face risks related to health epidemics, pandemics and other outbreaks, including the ongoing COVID-19 pandemic, which could adversely affect our business. ​ The circumstances of the ongoing COVID-19 pandemic and responses thereto continue to evolve.
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The products produced and services provided by Ball have been deemed essential and, as a result, relevant governments around the world have allowed our operations to continue through the pandemic.
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Some of these actions may include, and are not limited to: ​ ● Implementing alternative work arrangements including work from home; ● Limiting or eliminating work-related travel; ● Effecting a full or partial shut-down of operations; ● Enhancing the cleaning and disinfecting of our physical locations; ● Implementing health screening for employees and third parties who enter our facilities; ● Adjusting inventory levels to mitigate potential supply disruptions; ● Modifying payment terms with customers; ● Providing additional health-related services to our employees; ● Reducing compensation for our employees; ● Reducing our workforce levels; ● Modifying our debt arrangements; and ● Adjusting contributions to defined benefit pension plans or income tax payments. ​ 18 Table of Contents Governmental and regulatory risks ​ Changes in laws and governmental regulations may adversely affect our business and operations. ​ We and our customers and suppliers are subject to various federal, state, provincial and local laws and regulations, which have been increasing in number and complexity.
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The packages we produce are widely used and perform well in U.S. states, Canadian provinces and European countries that have deposit systems, as well as in other countries worldwide. ​ While deposit systems and other container-related legislation have been adopted in some jurisdictions, similar legislation has been defeated in public referenda and legislative bodies in many others.
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We anticipate that continuing efforts will be made to consider and adopt such legislation in the future.
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The company has a number of shared service centers where many of the company’s IT systems are concentrated and any disruption at such a location could impact the company’s business within the operating zones served by the impacted service center.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition to the facilities listed, the company leases other warehousing space. ​ Beverage packaging, North and Central America, locations: ● Bowling Green, Kentucky ● Conroe, Texas ● Fairfield, California ● Findlay, Ohio ● Fort Atkinson, Wisconsin ● Fort Worth, Texas ● Glendale, Arizona ● Golden, Colorado ● Goodyear, Arizona ● Kapolei, Hawaii ● Kent, Washington ● Monterrey, Mexico ● Monticello, Indiana ● Pittston, Pennsylvania ● Queretaro, Mexico ● Rome, Georgia ● Saint Paul, Minnesota (closed in the first quarter of 2023) ● Saratoga Springs, New York ● Tampa, Florida 22 Table of Contents ● Wallkill, New York ● Whitby, Ontario, Canada ● Williamsburg, Virginia Beverage packaging, EMEA, locations: ● Belgrade, Serbia ● Bierne, France ● Cabanillas del Campo, Spain ● Cairo, Egypt ● Ejpovice, Czech Republic ● Fosie, Sweden ● Fredericia, Denmark ● Gelsenkirchen, Germany ● La Selva, Spain ● Lublin, Poland ● Ludesch, Austria ● Manisa, Turkey ● Mantsala, Finland ● Milton Keynes, United Kingdom ● Mont, France ● Nogara, Italy ● Wakefield, United Kingdom ● Waterford, Ireland ● Widnau, Switzerland Beverage packaging, South America, locations: ● Aguas Claras, Brazil ● Asuncion, Paraguay ● Brasilia, Brazil ● Buenos Aires, Argentina ● Extrema, Brazil ● Frutal, Brazil ● Jacarei, Sao Paulo, Brazil ● Manaus, Brazil ● Pouso Alegre, Brazil ● Recife, Brazil ● Santiago, Chile ● Tres Rios, Rio de Janeiro, Brazil Beverage packaging, Other, locations: ● Dammam, Saudi Arabia ● Mumbai, India ● Sri City, India ● Yangon, Myanmar Aerosol packaging locations: ● Ahmedabad, India ● Beaurepaire, France ● Bellegarde, France ● Devizes, United Kingdom ● Itupeva, Brazil ● San Luis Potosí, Mexico ● Sherbrooke, Quebec, Canada ● Velim, Czech Republic ● Verona, Virginia Aluminum cups location: ● Rome, Georgia ​ 23 Table of Contents
Biggest changeIn addition to the facilities listed, the company leases other warehousing space. ​ Beverage packaging, North and Central America, locations: ● Bowling Green, Kentucky ● Conroe, Texas ● Fairfield, California ● Findlay, Ohio ● Fort Atkinson, Wisconsin ● Fort Worth, Texas ● Glendale, Arizona ● Golden, Colorado ● Goodyear, Arizona ● Kapolei, Hawaii ● Kent, Washington (planned closure in the first half of 2024) ● Monterrey, Mexico ● Monticello, Indiana ● Pittston, Pennsylvania ● Queretaro, Mexico ● Rome, Georgia ● Saratoga Springs, New York ● Tampa, Florida ● Whitby, Ontario, Canada ● Williamsburg, Virginia ​ Beverage packaging, EMEA, locations: ● Belgrade, Serbia ● Bierne, France ● Cabanillas del Campo, Spain ● Cairo, Egypt ● Ejpovice, Czech Republic ● Fosie, Sweden ● Fredericia, Denmark ● Gelsenkirchen, Germany ● Kettering, United Kingdom ● La Selva, Spain ● Lublin, Poland ● Ludesch, Austria ● Manisa, Turkey ● Mantsala, Finland ● Milton Keynes, United Kingdom ● Mont, France ● Nogara, Italy ● Pilsen, Czech Republic 22 Table of Contents ● Wakefield, United Kingdom ● Waterford, Ireland ● Widnau, Switzerland ​ Beverage packaging, South America, locations: ● Aguas Claras, Brazil ● Asuncion, Paraguay ● Brasilia, Brazil ● Buenos Aires, Argentina ● Extrema, Brazil ● Frutal, Brazil ● Jacarei, Sao Paulo, Brazil ● Manaus, Brazil ● Pouso Alegre, Brazil ● Recife, Brazil ● Santiago, Chile ● Tres Rios, Rio de Janeiro, Brazil ​ Beverage packaging, Other, locations: ● Dammam, Saudi Arabia ● Mumbai, India ● Sri City, India ● Yangon, Myanmar Aerosol packaging locations: ● Ahmedabad, India ● Beaurepaire, France ● Bellegarde, France ● Devizes, United Kingdom ● Itupeva, Brazil ● San Luis Potosí, Mexico ● Sherbrooke, Quebec, Canada ● Velim, Czech Republic Aluminum cups location: ● Rome, Georgia ​
The operations of the aerospace segment occupy a variety of company-owned and leased facilities in Colorado, U.S., which comprise office, laboratory, research and development, engineering and test and manufacturing space.
The operations of the aerospace segment occupy a variety of company-owned and leased facilities in Colorado, U.S., which comprise office, laboratory, research and development, engineering and test and manufacturing space. Other aerospace operations carry on business in smaller company owned and leased facilities in other U.S. locations outside of Colorado.
Other aerospace operations carry on business in smaller company owned and leased facilities in other U.S. locations outside of Colorado. ​ Ball’s manufacturing locations for significant packaging operations, which are owned or leased by the company, are set forth below. Facilities in the process of being constructed, or that have permanently ceased production, have been excluded from the list.
See Note 4 for further details. ​ Ball’s manufacturing locations for significant packaging operations, which are owned or leased by the company, are set forth below. Facilities in the process of being constructed, or that have permanently ceased production, have been excluded from the list.
Added
In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc. (BAE), to sell all of the outstanding equity interests in Ball’s aerospace business to BAE. On February 16, 2024, the company completed the divestiture of the aerospace business.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 24 ​ ​ ​ PART II. ​ ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases 24 Item 6. [Reserved] 25 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 26 ​ Forward-Looking Statements 37 Item 7A.
Biggest changeItem 4. Mine Safety Disclosures 23 ​ ​ ​ PART II. ​ ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 Item 6. [Reserved] 25 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 26 ​ Forward-Looking Statements 37 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk 37 Item 8.
Quantitative and Qualitative Disclosures About Market Risk 38 Item 8.
Removed
Financial Statements and Supplementary Data 39 ​ Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) 39 ​ Consolidated Statements of Earnings for the Years Ended December 31, 2022, 2021 and 2020 41 ​ Consolidated Statements of Comprehensive Earnings (Loss) for the Years Ended December 31, 2022, 2021 and 2020 42 ​ Consolidated Balance Sheets at December 31, 2022 and 2021 43 ​ Consolidated Statements of Cash Flows for the Years Ended December 31, 2022, 2021 and 2020 44 ​ Consolidated Statements of Shareholders’ Equity for the Years Ended December 31, 2022, 2021 and 2020 45 ​ Notes to the Consolidated Financial Statements 46 ​ Note 1, Critical and Significant Accounting Policies 46 ​ Note 2, Accounting Pronouncements 56 ​ Note 3, Business Segment Information 57 ​ Note 4, Acquisitions and Dispositions 60 ​ Note 5, Revenue from Contracts with Customers 62 ​ Note 6, Business Consolidation and Other Activities 63 ​ Note 7, Supplemental Cash Flow Statement Disclosures 65 ​ Note 8, Receivables, Net 65 ​ Note 9, Inventories, Net 66 ​ Note 10, Property, Plant and Equipment, Net 66 ​ Note 11, Goodwill 67 ​ Note 12, Intangibles Assets, Net 67 ​ Note 13, Other Assets 68 ​ Note 14, Leases 68 ​ Note 15, Debt and Interest Costs 70 ​ Note 16, Taxes on Income 71 ​ Note 17, Employee Benefit Obligations 75 ​ Note 18, Shareholders’ Equity 83 ​ Note 19, Stock-Based Compensation Programs 86 ​ Note 20, Earnings Per Share 87 ​ Note 21, Financial Instruments and Risk Management 88 ​ Note 22, Contingencies 93 ​ Note 23, Indemnifications and Guarantees 95 ​ Table of Contents
Added
Financial Statements and Supplementary Data 40 ​ Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) 40 ​ Consolidated Statements of Earnings for the Years Ended December 31, 2023, 2022 and 2021 42 ​ Consolidated Statements of Comprehensive Earnings (Loss) for the Years Ended December 31, 2023, 2022 and 2021 43 ​ Consolidated Balance Sheets at December 31, 2023 and 2022 44 ​ Consolidated Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021 45 ​ Consolidated Statements of Shareholders’ Equity for the Years Ended December 31, 2023, 2022 and 2021 46 ​ Notes to the Consolidated Financial Statements 47 ​ Note 1.
Added
Critical and Significant Accounting Policies 47 ​ Note 2. Accounting Pronouncements 58 ​ Note 3. Business Segment Information 59 ​ Note 4. Acquisitions and Dispositions 62 ​ Note 5. Revenue from Contracts with Customers 64 ​ Note 6. Business Consolidation and Other Activities 65 ​ Note 7. Supplemental Cash Flow Statement Disclosures 66 ​ Note 8.
Added
Receivables, Net 66 ​ Note 9. Inventories, Net 67 ​ Note 10. Property, Plant and Equipment, Net 67 ​ Note 11. Goodwill 68 ​ Note 12. Intangibles Assets, Net 68 ​ Note 13. Other Assets 69 ​ Note 14. Leases 69 ​ Note 15. Debt and Interest Costs 71 ​ Note 16. Taxes on Income 72 ​ Note 17.
Added
Employee Benefit Obligations 76 ​ Note 18. Shareholders’ Equity 85 ​ Note 19. Stock-Based Compensation Programs 87 ​ Note 20. Earnings Per Share 89 ​ Note 21. Financial Instruments and Risk Management 89 ​ Table of Contents ​ Note 22. Contingencies 95 ​ Note 23. Indemnifications and Guarantees 96

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe Dow Jones Containers & Packaging Index total return has been weighted by market capitalization. ​ 24 Table of Contents ​ ​ Total Return Analysis ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/31/2017 ​ 12/31/2018 ​ 12/31/2019 ​ 12/31/2020 ​ 12/31/2021 ​ 12/31/2022 BALL ​ $ 100.00 ​ $ 122.65 ​ $ 173.97 ​ $ 252.58 ​ $ 263.00 ​ $ 141.42 S&P 500 ​ ​ 100.00 ​ ​ 95.62 ​ ​ 125.72 ​ ​ 148.85 ​ ​ 191.58 ​ ​ 156.88 DJ US Containers & Packaging ​ ​ 100.00 ​ ​ 79.85 ​ ​ 100.28 ​ ​ 118.67 ​ ​ 129.17 ​ ​ 103.73 ​ Source: Bloomberg L.P.® Charts ​
Biggest changeThe Dow Jones Containers & Packaging Index total return has been weighted by market capitalization. ​ 24 Table of Contents ​ ​ Total Return Analysis ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 12/31/2018 ​ 12/31/2019 ​ 12/31/2020 ​ 12/31/2021 ​ 12/31/2022 ​ 12/31/2023 BALL ​ $ 100.00 ​ $ 141.83 ​ $ 205.93 ​ $ 214.43 ​ $ 115.30 ​ $ 131.61 S&P 500 ​ ​ 100.00 ​ ​ 128.88 ​ ​ 149.83 ​ ​ 190.13 ​ ​ 153.16 ​ ​ 190.27 DJ US Containers & Packaging ​ ​ 100.00 ​ ​ 125.59 ​ ​ 118.34 ​ ​ 108.85 ​ ​ 80.30 ​ ​ 104.72 ​ Source: Refinitiv ​
(b) The company has an ongoing repurchase program for which 50 million shares were authorized for repurchase by Ball’s Board of Directors. ​ Shareholder Return Performance ​ The line graph below compares the annual percentage change in Ball Corporation’s cumulative total shareholder return on its common stock with the cumulative total return of the Dow Jones Containers & Packaging Index and the S&P Composite 500 Stock Index for the five-year period ended December 31, 2022.
(b) The company has an ongoing repurchase program for which 50 million shares were authorized for repurchase by Ball’s Board of Directors. ​ Shareholder Return Performance ​ The line graph below compares the annual percentage change in Ball Corporation’s cumulative total shareholder return on its common stock with the cumulative total return of the Dow Jones Containers & Packaging Index and the S&P Composite 500 Stock Index for the five-year period ended December 31, 2023.
The graph assumes $100 was invested on December 31, 2017, and that all dividends were reinvested.
The graph assumes $100 was invested on December 31, 2018, and that all dividends were reinvested.
There were 6,739 common shareholders of record on February 16, 2023. ​ Common Stock Repurchases ​ The following table summarizes the company’s repurchases of its common stock during the quarter ended December 31, 2022. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchases of Securities ($ in millions) Total Number of Shares Purchased (a) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (b) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ October 1 to October 31, 2022 ​ — ​ $ — ​ — ​ 19,657,010 November 1 to November 30, 2022 ​ — ​ ​ — ​ — ​ 19,657,010 December 1 to December 31, 2022 ​ — ​ ​ — ​ — ​ 19,657,010 Total ​ — ​ ​ — ​ — ​ ​ (a) Includes any open market purchases (on a trade-date basis), share repurchase agreements and/or shares retained by the company to settle employee withholding tax liabilities.
There were 6,675 common shareholders of record on February 15, 2024. ​ 23 Table of Contents Common Stock Repurchases ​ The following table summarizes the company’s repurchases of its common stock during the fourth quarter of 2023. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchases of Securities ($ in millions) Total Number of Shares Purchased (a) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (b) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ October 1 to October 31, 2023 ​ — ​ $ — ​ — ​ 19,596,607 November 1 to November 30, 2023 ​ — ​ ​ — ​ — ​ 19,596,607 December 1 to December 31, 2023 ​ — ​ ​ — ​ — ​ 19,596,607 Total ​ — ​ ​ ​ ​ — ​ ​ (a) Includes any open market purchases (on a trade-date basis), share repurchase agreements and/or shares retained by the company to settle employee withholding tax liabilities.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeSee Note 4 to the consolidated financial statements within Item 8 of this annual report for additional discussion regarding the sale. ​ Beverage Packaging, South America ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 2,108 ​ $ 2,016 ​ $ 1,695 ​ Comparable operating earnings ​ ​ 275 ​ ​ 348 ​ ​ 280 ​ Comparable operating earnings as a % of segment net sales ​ ​ 13 % ​ 17 % ​ 17 % ​ To ensure supply/demand balance and optimize low-cost production, the company ceased operations at its Santa Cruz, Brazil, beverage can manufacturing facility during the third quarter of 2022, and temporarily reduced production across its remaining Brazilian beverage can manufacturing footprint. ​ Segment sales in 2022 were $92 million higher compared to 2021 primarily due to the contractual pass through of higher aluminum prices and price/mix, partially offset by 6 percent lower volumes. ​ Comparable operating earnings in 2022 were $73 million lower compared to 2021 primarily due to lower volumes, unfavorable regional customer/product mix and fixed cost absorption in Brazil, partially offset by the contractual pass through of costs and lower depreciation expense associated with the third quarter 2022 revision of estimated useful lives.
Biggest changeSee Note 4 to the consolidated financial statements within Item 8 of this annual report for additional discussion regarding the sale. ​ Beverage Packaging, South America ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 1,960 ​ $ 2,108 ​ $ 2,016 ​ Comparable operating earnings ​ ​ 266 ​ ​ 275 ​ ​ 348 ​ Comparable operating earnings as a % of segment net sales ​ ​ 14 % ​ 13 % ​ 17 % ​ Ball permanently ceased production at its Santa Cruz, Brazil, aluminum beverage can manufacturing facility in the third quarter of 2022. ​ Segment sales in 2023 were $148 million lower compared to 2022 due to a decrease from lower sales prices resulting mainly from lower aluminum prices net of the annual pass-through of inflationary costs. ​ Comparable operating earnings in 2023 were $9 million lower compared to 2022 primarily due to a $27 million decrease from unfavorable fixed cost absorption, partially offset by a $3 million increase from higher sales prices resulting mainly from the annual pass-through of inflationary costs net of current year inflation . ​ Aerospace ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 1,967 ​ $ 1,977 ​ $ 1,911 ​ Comparable operating earnings ​ ​ 219 ​ ​ 170 ​ ​ 169 ​ Comparable operating earnings as a % of segment net sales ​ ​ 11 % ​ 9 % ​ 9 % ​ In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc.
The historical operations and results of the Russian aluminum packaging business, including the gain on sale, are included in the beverage packaging, EMEA segment.
The historical operations and results of the Russian aluminum beverage packaging business, including the gain on sale, are included in the beverage packaging, EMEA segment.
See Note 4 to the consolidated financial statements within Item 8 of this annual report for additional discussion regarding the sale and its impact to Ball’s financial results. ​ A summary of the results of the Russian aluminum packaging business and the non-Russian components of the beverage packaging, EMEA, segment, for the years ended December 31, 2022 and 2021, are shown below: ​ 30 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ($ in millions) 2022 2021 ​ ​ ​ ​ ​ ​ ​ Net sales ​ ​ ​ ​ ​ ​ Russia ​ $ 554 ​ $ 594 Non-Russia ​ ​ 3,300 ​ ​ 2,915 Beverage packaging, EMEA, segment ​ $ 3,854 ​ $ 3,509 ​ ​ ​ ​ ​ ​ ​ Comparable operating earnings ​ ​ ​ ​ ​ ​ Russia ​ $ 86 ​ $ 129 Non-Russia ​ ​ 272 ​ ​ 323 Beverage packaging, EMEA, segment ​ $ 358 ​ $ 452 ​ The Russian sales and comparable operating earnings figures in the above table include historical support by Russia for non-Russian regions.
See Note 4 of these consolidated financial statements within Item 8 of this annual report for additional discussion regarding the sale and its impact to Ball’s financial results. ​ 29 Table of Contents A summary of the results of the Russian aluminum beverage packaging business and the non-Russian components of the beverage packaging, EMEA, segment, for the years ended December 31, 2022 and 2021, are shown below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ($ in millions) 2022 2021 ​ ​ ​ ​ ​ ​ ​ Net sales ​ ​ ​ ​ ​ ​ Russia ​ $ 554 ​ $ 594 Non-Russia ​ ​ 3,300 ​ ​ 2,915 Beverage packaging, EMEA, segment ​ $ 3,854 ​ $ 3,509 ​ ​ ​ ​ ​ ​ ​ Comparable operating earnings ​ ​ ​ ​ ​ ​ Russia ​ $ 86 ​ $ 129 Non-Russia ​ ​ 272 ​ ​ 323 Beverage packaging, EMEA, segment ​ $ 358 ​ $ 452 ​ The Russian sales and comparable operating earnings figures in the above table include historical support by Russia for non-Russian regions.
Federal Drug Administration and other actions or public concerns affecting products filled in Ball’s containers, or chemicals or substances used in raw materials or in the manufacturing process; technological developments and innovations; the ability to manage cyber threats; litigation; strikes; disease; pandemic; labor cost changes; inflation; rates of return on assets of Ball’s defined benefit retirement plans; pension changes; uncertainties surrounding geopolitical events and governmental policies, including policies, orders, and actions related to COVID-19; reduced cash flow; interest rates affecting Ball’s debt; and successful or unsuccessful joint ventures, acquisitions and divestitures, and their effects on Ball’s operating results and business generally. ​
Federal Drug Administration and other actions or public concerns affecting products filled in Ball’s containers, or chemicals or substances used in raw materials or in the manufacturing process; technological developments and innovations; the ability to manage cyber threats; litigation; strikes; disease; pandemic; labor cost changes; inflation; rates of return on assets of Ball’s defined benefit retirement plans; pension changes; uncertainties surrounding geopolitical events and governmental policies, including policies, orders, and actions related to COVID-19; reduced cash flow; interest rates affecting Ball’s debt; successful or unsuccessful joint ventures, acquisitions and divestitures, and their effects on Ball’s operating results and business generally. ​ 37 Table of Contents
Detailed below is a discussion of why, to the extent the estimate is material, these estimates are subject to uncertainty and the sensitivity of the reported amounts to the methods, assumptions, and estimates underlying the estimate’s calculation. ​ 32 Table of Contents Revenue Recognition in the Aerospace Segment ​ Sales under fixed-price long-term contracts in the aerospace segment are primarily recognized using percentage-of-completion accounting under the cost-to-cost method.
Detailed below is a discussion of why, to the extent the estimate is material, these estimates are subject to uncertainty and the sensitivity of the reported amounts to the methods, assumptions, and estimates underlying the estimate’s calculation. ​ 31 Table of Contents Revenue Recognition in the Aerospace Segment ​ Sales under fixed-price long-term contracts in the aerospace segment are primarily recognized using percentage-of-completion accounting under the cost-to-cost method.
These aluminum purchase commitments include pass-through provisions which generally result in proportional changes in both sales and costs of sales ; however, there may be timing differences of when the costs are passed through . ​ The company’s growth and asset maintenance plans require capital expenditures over the next years, which will be funded by operating cash flows and external borrowings.
These aluminum purchase commitments include pass-through provisions which generally result in proportional changes in both sales and costs of sales ; however, there may be timing differences of when the costs are passed through . ​ The company’s growth and asset maintenance plans require capital expenditures over the coming years, which will be funded by operating cash flows and external borrowings.
As described in the supplemental indentures governing the company’s existing senior notes, the senior notes are guaranteed by any of the company’s domestic subsidiaries that guarantee any other indebtedness of the company. ​ The following summarized financial information relates to the obligor group as of and for the years ended December 31, 2022 and 2021.
As described in the supplemental indentures governing the company’s existing senior notes, the senior notes are guaranteed by any of the company’s domestic subsidiaries that guarantee any other indebtedness of the company. ​ The following summarized financial information relates to the obligor group as of and for the years ended December 31, 2023 and 2022.
The company believes the matters identified will not have a material adverse effect upon its liquidity, results of operations or financial condition. ​ 35 Table of Contents Guaranteed Securities ​ The company’s senior notes are guaranteed on a full and unconditional, joint and several basis by the issuer of the company’s senior notes and the subsidiaries that guarantee the notes (the obligor group).
The company believes the matters identified will not have a material adverse effect upon its liquidity, results of operations or financial condition. ​ Guaranteed Securities ​ The company’s senior notes are guaranteed on a full and unconditional, joint and several basis by the issuer of the company’s senior notes and the subsidiaries that guarantee the notes (the obligor group).
During the years ended December 31, 2022 and 2021, the obligor group received dividends from other subsidiary companies of $18 million and $269 million, respectively. ​ A description of the terms and conditions of the company’s debt guarantees is located in Note 23 to the consolidated financial statements within Item 8 of this annual report. ​ 36 Table of Contents FORWARD-LOOKING STATEMENTS ​ This report contains “forward-looking” statements concerning future events and financial performance.
During the years ended December 31, 2023 and 2022, the obligor group received dividends from other subsidiary companies of $814 million and $18 million, respectively. ​ A description of the terms and conditions of the company’s debt guarantees is located in Note 23 to the consolidated financial statements within Item 8 of this annual report. ​ 36 Table of Contents FORWARD-LOOKING STATEMENTS ​ This report contains “forward-looking” statements concerning future events and financial performance.
Additional factors that might affect: a) Ball’s packaging segments include product capacity, supply, and demand constraints and fluctuations and changes in consumption patterns; availability/cost of raw materials, equipment, and logistics; competitive packaging, pricing and substitution; changes in climate and weather and related events such as drought, wildfires, storms, hurricanes, tornadoes and floods; footprint adjustments and other manufacturing changes, including the startup of new facilities and lines; failure to achieve synergies, productivity improvements or cost reductions; unfavorable mandatory deposit or packaging laws; customer and supplier consolidation; power and supply chain interruptions; changes in major customer or supplier contracts or loss of a major customer or supplier; inability to pass through increased costs; war, political instability and sanctions, including relating to the situation in Russia and Ukraine and its impact on Ball’s supply chain and its ability to operate in Europe, the Middle East and Africa regions generally; changes in foreign exchange or tax rates; and tariffs, trade actions, or other governmental actions, including business restrictions and orders affecting goods produced by Ball or in its supply chain, including imported raw materials; b) Ball’s aerospace segment include funding, authorization, availability and returns of government and commercial contracts; and delays, extensions and technical uncertainties affecting segment contracts; c) Ball as a whole include those listed above plus: the extent to which sustainability-related opportunities arise and can be capitalized upon; changes in senior management, succession, and the ability to attract and retain skilled labor; regulatory actions or issues including those related to tax, environmental, social and governance reporting, competition, environmental, health and workplace safety, including U.S.
Additional factors that might affect: a) Ball’s packaging segments include product capacity, supply, and demand constraints and fluctuations and changes in consumption patterns; availability/cost of raw materials, equipment, and logistics; competitive packaging, pricing and substitution; changes in climate and weather and related events such as drought, wildfires, storms, hurricanes, tornadoes and floods; footprint adjustments and other manufacturing changes, including the startup of new facilities and lines; failure to achieve synergies, productivity improvements or cost reductions; unfavorable mandatory deposit or packaging laws; customer and supplier consolidation; power and supply chain interruptions; changes in major customer or supplier contracts or loss of a major customer or supplier; inability to pass through increased costs; war, political instability and sanctions, including relating to the situation in Russia and Ukraine and its impact on Ball’s supply chain and its ability to operate in Europe, the Middle East and Africa regions generally; changes in foreign exchange or tax rates; and tariffs, trade actions, or other governmental actions, including business restrictions and orders affecting goods produced by Ball or in its supply chain, including imported raw materials; and b) Ball as a whole include those listed above plus: the extent to which sustainability-related opportunities arise and can be capitalized upon; changes in senior management, succession, and the ability to attract and retain skilled labor; regulatory actions or issues including those related to tax, environmental, social and governance reporting, competition, environmental, health and workplace safety, including U.S.
Approximately $810 million of capital expenditures were contractually committed as of December 31, 2022. Maturities for Ball’s long-term debt are disclosed in Note 15 to the consolidated financial statements within Item 8 of this annual report. Repayments of debt and other operational cash requirements will also be funded by operating cash flows and external borrowings.
Approximately $258 million of capital expenditures were contractually committed as of December 31, 2023. Maturities for Ball’s long-term debt are disclosed in Note 15 to the consolidated financial statements within Item 8 of this annual report. Repayments of debt and other operational cash requirements will also be funded by operating cash flows and external borrowings.
As of December 31, 2022, the company could borrow an additional $2.32 billion under its long-term multi-currency committed revolving facilities and short-term uncommitted credit facilities without violating our existing debt covenants.
As of December 31, 2023, the company could borrow an additional $2.36 billion under its long-term multi-currency committed revolving facilities and short-term uncommitted credit facilities without violating our existing debt covenants.
It is not practical to estimate the additional taxes that might become payable if these earnings were remitted to the U.S. ​ Share Repurchases ​ The company’s share repurchases totaled $618 million in 2022 and $766 million in 2021.
It is not practical to estimate the additional taxes that might become payable if these earnings were remitted to the U.S. ​ Share Repurchases ​ The company’s share repurchases totaled $3 million in 2023 and $618 million in 2022.
Interest expense, excluding the effect of debt refinancing and other costs, as a percentage of average borrowings increased by approximately 10 basis points from 3.4 percent in 2021 to 3.5 percent in 2022 due to an increase in global interest rates.
Interest expense, excluding the effect of debt refinancing and other costs, as a percentage of average borrowings increased by approximately 140 basis points from 3.5 percent in 2022 to 4.9 percent in 2023 due to an increase in global interest rates.
Management’s Discussion and Analysis of Financial Condition and Results of Operations of the company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed on February 16, 2021, for a comparison of our 2021 results of operations to the 2020 results. ​ Global Economic Environment ​ In 2022 data indicated a sharp rise in inflation in the regions where we operate.
Management’s Discussion and Analysis of Financial Condition and Results of Operations of the company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed on February 21, 2023, for a comparison of our 2022 results of operations to the 2021 results. ​ Global Economic Environment ​ Recent data has indicated continued high inflation in the regions where we operate.
Anyone employed by Ball prior to that date is unaffected by this change. ​ Other Liquidity Measures ​ Given the on-going growth projects in our businesses being undertaken to support EVA-enchancing contacted volumes, in 2023, we expect capital expenditures to be in the range of $1.2 billion and we intend to return approximately $250 million to shareholders in the form of dividends.
Anyone employed by Ball prior to that date is unaffected by this change. ​ Other Liquidity Measures ​ Given the on-going growth projects in our businesses being undertaken to support EVA-enhancing contracted volumes, in 2024, we expect capital expenditures to be in the range of $650 million and we intend to return approximately $247 million to shareholders in the form of dividends.
Current and future inflationary effects may continue to be impacted by, among other things, supply chain disruptions, governmental stimulus or fiscal policies, changes in interest rates, and changing demand for certain goods and services as recovery from the COVID-19 pandemic continues.
Current and future inflationary effects may continue to be impacted by, among other things, supply chain disruptions, governmental stimulus or fiscal and monetary policies, changes in interest rates, and changing demand for certain goods and services.
The company is routinely subject to litigation incidental to operating its businesses and has been designated by various federal and state environmental agencies as a potentially responsible party, along with numerous other companies, for the clean-up of several hazardous waste sites, including in respect of sites related to alleged activities of certain former Rexam subsidiaries.
The company is routinely subject to litigation incidental to operating its businesses and has been designated by various federal, state, and international environmental agencies as a potentially responsible party, along with numerous other companies, for the clean-up of several hazardous waste sites.
While these items are expected to recur, the potential magnitude of each item is uncertain. ​ Further details of taxes on income, including impacts of the U.S. tax reform, are provided in Note 16 to the consolidated financial statements within Item 8 of this annual report. ​ 29 Table of Contents RESULTS OF BUSINESS SEGMENTS ​ Segment Results ​ Ball’s operations are organized and reviewed by management along its product lines and geographical areas, and its operating results are presented in the four reportable segments discussed below. ​ Beverage Packaging, North and Central America ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 6,696 ​ $ 5,856 ​ $ 5,076 ​ Comparable operating earnings ​ ​ 642 ​ ​ 681 ​ ​ 683 ​ Comparable operating earnings as a % of segment net sales ​ ​ 10 % ​ 12 % ​ 13 % ​ In the third quarter of 2022, Ball announced the permanent closure of its aluminum beverage can manufacturing facilities in Phoenix, Arizona, and St.
While these items are expected to recur, the potential magnitude of each item is uncertain. ​ Further details of taxes on income are provided in Note 16 to the consolidated financial statements within Item 8 of this annual report. ​ RESULTS OF BUSINESS SEGMENTS ​ Segment Results ​ Ball’s operations are organized and reviewed by management along its product lines and geographical areas, and its operating results are presented in the four reportable segments discussed below. ​ 28 Table of Contents Beverage Packaging, North and Central America ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 5,963 ​ $ 6,696 ​ $ 5,856 ​ Comparable operating earnings ​ ​ 710 ​ ​ 642 ​ ​ 681 ​ Comparable operating earnings as a % of segment net sales ​ ​ 12 % ​ 10 % ​ 12 % ​ Ball permanently ceased production at its Phoenix, Arizona aluminum beverage can manufacturing facility in the fourth quarter of 2022, permanently ceased production at its aluminum beverage can manufacturing facility in St.
As compared with the statutory U.S. federal income tax rate of 21 percent, the 2022 effective income tax rate was reduced by 3.2 percent for the impact of the U.S. research and development credit and by 2.8 percent for the impact of non-U.S. rate differences including tax holidays.
As compared with the statutory U.S. federal income tax rate of 21 percent, the 2023 effective income tax rate was reduced by 8.2 percent for the impact of the U.S. research and development credit, by 4.7 percent for non-U.S. rate differences including tax holidays, and by 4.7 percent for the impact of U.S. taxes on non-U.S. earnings including the foreign tax credit.
The amounts in 2022 included impairment losses on Russia’s long-lived asset group, the gain on sale of Ball’s Russian aluminum beverage packaging business, the gain on sale of Ball’s remaining equity method investment in Ball Metalpack, charges related to a Brazilian customer’s contract breach, facility shutdown costs, charges for employee severance and benefits related to cost-out activities and a charge related to a donation to the Ball Foundation.
The amounts in 2022 included impairment losses on Russia’s long-lived asset group, the gain on sale of Ball’s Russian aluminum beverage packaging business, the gain on sale of Ball’s remaining equity method investment in Ball Metalpack, facility shutdown costs and a charge related to a donation to the Ball Foundation.
Investments in subsidiaries not forming part of the obligor group have also been eliminated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Year Ended ($ in millions) ​ December 31, 2022 December 31, 2021 ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 9,975 ​ $ 8,083 Gross profit (a) ​ ​ 996 ​ ​ 910 Net earnings ​ ​ 635 ​ ​ 432 Net earnings attributable to Ball Corporation ​ ​ 635 ​ ​ 432 (a) Gross profit is shown after depreciation and amortization related to cost of sales of $261 million and $210 million for the years ended December 31, 2022 and 2021, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ($ in millions) 2022 2021 ​ ​ ​ ​ ​ ​ ​ Current assets ​ $ 2,478 ​ $ 2,575 Noncurrent assets ​ ​ 15,764 ​ ​ 14,818 Current liabilities ​ ​ 6,032 ​ ​ 5,067 Noncurrent liabilities ​ ​ 10,790 ​ ​ 10,989 ​ Included in the amounts disclosed in the tables above, at December 31, 2022 and 2021, the obligor group held receivables due from other subsidiary companies of $477 million and $436 million, respectively, long-term notes receivable due from other subsidiary companies of $9.89 billion and $9.22 billion, respectively, payables due to other subsidiary companies of $2.22 billion and $2.03 billion, respectively, and long-term notes payable due to other subsidiary companies of $2.21 billion and $1.99 billion, respectively. ​ For the years ended December 31, 2022 and 2021, the obligor group recorded the following transactions with other subsidiary companies: sales to them of $1.50 Billion and $803 million, respectively, net credits from them of $19 million and $18 million, respectively, and net interest income from them of $329 million and $337 million, respectively.
Investments in subsidiaries not forming part of the obligor group have also been eliminated. ​ 35 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Year Ended ($ in millions) ​ December 31, 2023 December 31, 2022 ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 8,962 ​ $ 9,975 Gross profit (a) ​ ​ 1,074 ​ ​ 996 Net earnings ​ ​ 493 ​ ​ 635 Net earnings attributable to Ball Corporation ​ ​ 493 ​ ​ 635 (a) Gross profit is shown after depreciation and amortization related to cost of sales of $272 million and $261 million for the years ended December 31, 2023 and 2022, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ($ in millions) 2023 2022 ​ ​ ​ ​ ​ ​ ​ Current assets ​ $ 2,339 ​ $ 2,478 Noncurrent assets ​ ​ 15,955 ​ ​ 15,764 Current liabilities ​ ​ 5,163 ​ ​ 6,032 Noncurrent liabilities ​ ​ 10,857 ​ ​ 10,790 ​ Included in the amounts disclosed in the tables above, at December 31, 2023 and 2022, the obligor group held receivables due from other subsidiary companies of $768 million and $477 million, respectively, long-term notes receivable due from other subsidiary companies of $10.20 billion and $9.89 billion, respectively, payables due to other subsidiary companies of $1.83 billion and $2.22 billion, respectively, and long-term notes payable due to other subsidiary companies of $2.32 billion and $2.21 billion, respectively. ​ For the years ended December 31, 2023 and 2022, the obligor group recorded the following transactions with other subsidiary companies: sales to them of $1.13 billion and $1.50 billion, respectively, net credits from them of $38 million and $19 million, respectively, and net interest income from them of $344 million and $329 million, respectively.
In addition to these facilities, the company had approximately $990 million of short-term uncommitted credit facilities available at December 31, 2022, of which $112 million was outstanding and due on demand. ​ 34 Table of Contents While ongoing financial and economic conditions in certain areas may raise concerns about credit risk with counterparties to derivative transactions, the company mitigates its exposure by allocating the risk among various counterparties and limiting exposure to any one party.
At December 31, 2022, the company had $293 million of committed short-term loans outstanding and $112 million outstanding under short-term uncommitted credit facilities. ​ While ongoing financial and economic conditions in certain areas may raise concerns about credit risk with counterparties to derivative transactions, the company mitigates its exposure by allocating the risk among various counterparties and limiting exposure to any one party.
Additionally, we are unable to predict the potential effects that any resurgence of COVID-19, its variants or any future pandemic, or the continuation or escalation of the military conflict between Russia and Ukraine, and related sanctions or market disruptions, may have on our business.
Additionally, we are unable to predict the potential effects that any future pandemic, or the continuation or escalation of global conflicts, including the conflict between Russia and Ukraine and the rising instability in the Middle East, and related sanctions or market disruptions, may have on our business.
Increased debt levels in 2022 compared to 2021 further contributed to higher interest expense for the year. ​ Tax Provision ​ The company’s effective tax rate is affected by recurring items such as income earned in non-U.S. jurisdictions with tax rates that differ from the U.S. tax rate and by discrete items that may occur in any given year but are not consistent from year to year. ​ The 2022 effective income tax rate was 18.0 percent compared to 15.5 percent for 2021.
As such, the increase in interest expense was primarily driven by an $132 million increase from higher weighted average interest rates on outstanding debt during the year, along with a $15 million increase from a larger amount of weighted average principal outstanding during the year. ​ Tax Provision ​ The company’s effective tax rate is affected by recurring items such as income earned in non-U.S. jurisdictions with tax rates that differ from the U.S. tax rate and by discrete items that may occur in any given year but are not consistent from year to year. ​ The 2023 effective income tax rate was 15.1 percent compared to 18.0 percent for 2022.
The following table summarizes our cash flows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ($ in millions) 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows provided by (used in) operating activities ​ $ 301 ​ $ 1,760 ​ $ 1,432 Cash flows provided by (used in) investing activities ​ ​ (786) ​ ​ (1,639) ​ ​ (1,181) Cash flows provided by (used in) financing activities ​ ​ 485 ​ ​ (894) ​ ​ (602) ​ Cash flows provided by operating activities were $301 million in 2022, primarily driven by net earnings of $732 million, depreciation and amortization of $672 million and business consolidation and other costs of $71 million, partially offset by working capital outflows of $924 million and pension contributions of $124 million.
The following table summarizes our cash flows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ($ in millions) 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows provided by (used in) operating activities ​ $ 1,863 ​ $ 301 ​ $ 1,760 Cash flows provided by (used in) investing activities ​ ​ (1,053) ​ ​ (786) ​ ​ (1,639) Cash flows provided by (used in) financing activities ​ ​ (662) ​ ​ 485 ​ ​ (894) ​ Cash flows provided by operating activities were $1,863 million in 2023, primarily driven by net earnings of $711 million, depreciation and amortization of $686 million, working capital inflows of $360 million and business consolidation and other costs of $153 million.
The repurchases were completed using cash on hand, cash provided by operating activities, proceeds from the sale of businesses and available borrowings. ​ In the second quarter of 2022, in a privately negotiated transaction, Ball entered into an accelerated share repurchase agreement to buy $300 million of its common shares using cash on hand and available borrowings.
See Note 4 for further details. ​ In the second quarter of 2022, in a privately negotiated transaction, Ball entered into an accelerated share repurchase agreement to buy $300 million of its common shares using cash on hand and available borrowings.
In the event we need to utilize any of the cash held outside of the U.S. for purposes within the U.S., there are no material legal or other economic restrictions regarding the repatriation of cash from any of the countries outside the U.S. where we have cash.
In the event that we would need to utilize any of the cash held outside of the U.S. for purposes within the U.S., there are no material legal or other economic restrictions regarding the repatriation of cash from any of the countries outside the U.S. where we have cash, other than market liquidity constraints that limit the ability to convert Egyptian pounds held by the company in Egypt with a U.S. dollar equivalent value of $110 million into other currencies.
The aerospace contract mix in 2022 consisted of 40 percent cost-type contracts, which are billed at our costs plus an agreed-upon and/or earned profit component, and 57 percent fixed-price contracts.
The aerospace contract mix in 2023 consisted of 41 percent cost-type contracts, which are billed at our costs plus an agreed-upon and/or earned profit component, and 56 percent fixed-price contracts. The remaining sales were for time and materials contracts. ​ Backlog for the aerospace segment at December 31, 2023 and 2022, was $2.98 billion and $2.97 billion, respectively.
Further details regarding business consolidation costs and other activities, including the Russian impairment and gain on sale, are provided in Note 10 and Note 4 , respectively. ​ Interest Expense ​ Total interest expense was $330 million in 2022 compared to $283 million in 2021.
Further details and quantification regarding business consolidation costs and other activities are provided in Note 6 . ​ Interest Expense ​ Total interest expense was $459 million in 2023 compared to $330 million in 2022.
Programs accounted for as true sales of the receivables, without recourse to Ball, had combined limits of approximately $2.04 billion and $1.74 billion at December 31, 2022, and December 31, 2021, respectively.
The programs are accounted for as true sales of the receivables, with limited recourse to Ball, and had combined limits of approximately $2.00 billion and $2.04 billion at December 31, 2023, and December 31, 2022, respectively. A total of $350 million and $488 million were available for sale under these programs at December 31, 2023 and 2022, respectively.
Amortization expense in 2022 and 2021 included $135 million and $152 million, respectively, for the amortization of acquired Rexam intangibles.The decrease compared to the same period in 2021 is primarily due to revised estimated useful lives of the company’s manufacturing equipment, buildings and certain assembly and test equipment, as well as 28 Table of Contents the impairment and ultimate sale of the Russia aluminum beverage packaging business.
The increase compared to the same period in 2022 is primarily due to the company’s larger depreciable asset base, partially 27 Table of Contents offset by revised estimated useful lives of the company’s manufacturing equipment, buildings and certain assembly and test equipment, as well as the sale of the Russian aluminum beverage packaging business.
The company’s senior credit facilities include a $1.35 billion term loan and long-term, multi-currency revolving facilities that mature in June 2027, which provide the company with up to the U.S. dollar equivalent of $1.75 billion.
During 2022, Ball issued $750 million of 6.875% senior notes due in 2028, redeemed $738 million of outstanding euro denominated 4.375% debt and completed the closing of its new revolving and term loan senior secured credit facilities that refinanced its existing senior secured credit facilities entered into in 2019. ​ The company’s senior credit facilities include a $1.35 billion term loan and long-term, multi-currency revolving facilities that mature in June 2027, which provide the company with up to the U.S. dollar equivalent of $1.75 billion.
In 2023 we expect to improve year-over-year results through fixed cost savings from rightsizing production and the contractual recovery of 2022 inflationary costs. ​ Beverage Packaging, EMEA ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 3,854 ​ $ 3,509 ​ $ 2,945 ​ Comparable operating earnings ​ ​ 358 ​ ​ 452 ​ ​ 354 ​ Comparable operating earnings as a % of segment net sales ​ ​ 9 % ​ 13 % ​ 12 % ​ Segment sales in 2022 were $345 million higher compared to 2021 primarily due to the pass through of higher aluminum prices, favorable price/mix and 4 percent volume growth, partially offset by approximately $400 million from unfavorable currency translation and the sale of the Russian aluminum beverage packaging business. ​ Comparable operating earnings in 2022 were $94 million lower compared to 2021 primarily due to approximately $40 million from unfavorable currency translation, the impact of higher inflation, energy costs, supply disruptions across the region and the sale of the Russian aluminum beverage packaging business, partially offset by the pass through of higher aluminum prices, volume growth and lower depreciation expense associated with the third quarter 2022 revision of estimated useful lives. ​ During the third quarter of 2022, and further to the Russian invasion of Ukraine, the company sold its Russian business, composed of three manufacturing facilities, for total cash consideration of $530 million.
Fixed and variable cost management and operational performance initiatives continue and are expected to improve results in 2024 and beyond. ​ Beverage Packaging, EMEA ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 3,395 ​ $ 3,854 ​ $ 3,509 ​ Comparable operating earnings ​ ​ 354 ​ ​ 358 ​ ​ 452 ​ Comparable operating earnings as a % of segment net sales ​ ​ 10 % ​ 9 % ​ 13 % ​ Segment sales in 2023 were $459 million lower compared to 2022 primarily due to a $554 million decrease from the 2022 sale of the Russian aluminum beverage packaging business and a $77 million decrease from lower volumes , partially offset by an $168 million increase from higher sales prices resulting mainly from the annual pass-through of inflationary costs net of lower aluminum prices. ​ Comparable operating earnings in 2023 were $4 million lower compared to 2022 primarily due to an $86 million decrease from the 2022 sale of the Russian aluminum beverage packaging business, a $46 million decrease from new facility start-up costs and a $27 million decrease from currency translation , partially offset by an $126 million increase from higher sales prices mainly from the annual pass-through of inflationary costs net of current year inflation. ​ During the third quarter of 2022, and further to the Russian invasion of Ukraine, the company sold its Russian business, composed of three manufacturing facilities, for total cash consideration of $530 million.
The overall global aluminum beverage and aerosol container industries are growing and are expected to continue to grow in the medium to long term. The primary customers for the products and services provided by our aerospace segment are U.S. government agencies or their prime contractors. ​ We purchase our raw materials from relatively few suppliers.
The primary customers for the products and services provided by our aerospace segment are U.S. government agencies or their prime contractors. ​ We purchase our raw materials from relatively few suppliers. We also have exposure to inflation, in particular the rising costs of raw materials, as well as other direct cost inputs.
We further intend to utilize our operating cash flows to pay down debt and, to the extent available, repurchase Ball common stock or fund acquisitions that meet our rate of return criteria. ​ We have committed contracts to purchase raw materials and we align these purchase commitments with long-term sales contracts with our customers such that any commitment to purchase aluminum and other direct materials corresponds to a contractual sale.
See Note 4 for further details. ​ We have committed contracts to purchase raw materials and we align these purchase commitments with long-term sales contracts with our customers such that any commitment to purchase aluminum and other direct materials corresponds to a contractual sale.
The segment has numerous outstanding bids for future contract awards. The backlog at December 31, 2022, consisted of 35 percent cost-type contracts.
The actual amount of funding received in the future may be higher or lower than our estimate of potential contract value. The segment has numerous outstanding bids for future contract awards. The backlog at December 31, 2023, consisted of 52 percent cost-type contracts.
This is evidenced by our high customer retention and our large number of long-term supply contracts. While we have a diversified customer base, we sell a significant portion of our packaging products to major companies and brands, as well as to numerous regional customers.
While we have a diversified customer base, we sell a significant portion of our packaging products to major companies and brands, as well as to numerous regional customers. The overall global aluminum beverage and aerosol container industries are growing and are expected to continue to grow in the medium to long term.
Additionally, we took actions to normalize inventory levels and reduce fixed and variable costs heading into 2023 that we expect will improve financial results. ​ Depreciation and Amortization ​ Depreciation and amortization expense was $672 million in 2022 compared to $700 million in 2021.
We took actions to normalize inventory levels and reduce fixed and variable costs in 2023 that improved financial results. ​ Depreciation and Amortization ​ Depreciation and amortization expense was $686 million in 2023 compared to $672 million in 2022. These amounts represented 5 percent and 4 percent of consolidated net sales for the years ended 2023 and 2022, respectively.
These amounts represented 83 percent and 80 percent of consolidated net sales for the years ended 2022 and 2021, respectively. The increase year-over-year is primarily due to higher manufacturing costs, general inflationary cost pressures and global supply chain transportation disruptions.
These amounts represented 81 percent and 83 percent of consolidated net sales for the years ended 2023 and 2022, respectively. The decrease year-over-year is primarily due to lower manufacturing costs, including lower aluminum costs of $1.29 billion, and lower freight expenses of $176 million.
It remains uncertain how long any of these conditions may last or how severe any of them may become. ​ Consolidated Sales and Earnings ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 15,349 ​ $ 13,811 ​ $ 11,781 ​ Net earnings attributable to Ball Corporation ​ ​ 719 ​ ​ 878 ​ ​ 585 ​ Net earnings attributable to Ball Corporation as a % of net sales ​ ​ 5 % ​ 6 % ​ 5 % ​ Sales in 2022 were $1,538 million higher compared to 2021 primarily due to the pass through of higher aluminum prices and the delayed recoverability of inflationary costs, partially offset by currency translation. ​ Net earnings attributable to Ball Corporation in 2022 were $159 million lower than 2021 primarily due to increased manufacturing and inflationary costs and net charges from the impairment of Russian long-lived assets and the gain from the sale of Ball’s Russian aluminum beverage packaging business, partially offset by the gain on sale of our remaining equity investment in Ball Metalpack, lower pension settlement charges in 2022 than in 2021 and lower depreciation expense.
It remains uncertain how long any of these conditions may last or how severe any of them may become. ​ Consolidated Sales and Earnings ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) 2023 2022 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 14,029 ​ $ 15,349 ​ $ 13,811 ​ Net earnings attributable to Ball Corporation ​ ​ 707 ​ ​ 719 ​ ​ 878 ​ Net earnings attributable to Ball Corporation as a % of net sales ​ ​ 5 % ​ 5 % ​ 6 % ​ Sales in 2023 were $1,320 million lower compared to 2022 primarily due to a $554 million decrease from the 2022 sale of the Russian aluminum beverage packaging business, a $514 million decrease from lower volumes and a $305 million decrease from lower sales prices resulting mainly from lower aluminum prices net of the annual pass-through of inflationary costs. ​ Net earnings attributable to Ball Corporation in 2023 were $12 million lower compared to 2022 primarily due to an $129 million increase in interest expense, an $124 million decrease from lower volumes, an $86 million decrease from the 2022 sale of the Russian aluminum beverage packaging business and an $82 million increase in business consolidation costs and other activities, partially offset by an $184 million increase from higher sales prices resulting mainly from the annual pass-through of inflationary costs net of current year inflation, $80 million of cost savings from rightsizing production, a $49 million increase from contract mix and operational performance in the aerospace segment and a $36 million decrease in the income tax provision. ​ Cost of Sales (Excluding Depreciation and Amortization) ​ Cost of sales, excluding depreciation and amortization, was $11,359 million in 2023 compared to $12,766 million in 2022.
Based on our most current understanding, the LIBOR to SOFR transition is not expected to have a material impact on our financial condition, results of operations or cash flows. ​ We were in compliance with all loan agreements at December 31, 2022, and for all prior years presented, and we have met all debt payment obligations.
We also monitor the credit ratings of our suppliers, customers, lenders and counterparties on a regular basis. ​ We were in compliance with all loan agreements at December 31, 2023, and for all prior years presented, and we have met all debt payment obligations.
A company competing to be a prime contractor may, upon ultimate award of the contract to a competitor, become a subcontractor for the ultimate prime contracting company. ​ 26 Table of Contents Corporate Strategy ​ Our Drive for 10 vision encompasses five strategic levers that are key to growing our business and achieving long-term success.
A company competing to be a prime contractor may, upon ultimate award of the contract to a competitor, become a subcontractor for the ultimate prime contracting company. ​ 26 Table of Contents RESULTS OF OPERATIONS ​ Management’s discussion and analysis for our results of operations on a consolidated and segment basis include a quantification of factors that had a material impact.
New employees instead receive a non-elective 401(k) company contribution that is expected to approximate the legacy pension benefit.
See Note 17 for further details. ​ 34 Table of Contents The company closed its pension plans to all non-unionized new entrants in the United States effective for anyone hired after December 31, 2021. New employees instead receive a non-elective 401(k) company contribution that is expected to approximate the legacy pension benefit.
The increase in SG&A expenses was primarily due to higher accounts receivable factoring costs, partially offset by lower personnel costs during the fourth quarter. ​ Business Consolidation Costs and Other Activities ​ Business consolidation costs and other activities were $71 million in 2022 compared to $142 million in 2021.
The decrease in SG&A expenses was primarily due to a $26 million increase in foreign exchange gains and a $23 million decrease in professional service costs. ​ Business Consolidation Costs and Other Activities ​ Business consolidation and other activities resulted in charges of $153 million in 2023 compared to charges of $71 million in 2022.
During 2021, Ball issued $850 million of 3.125% senior notes due in 2031 and redeemed the outstanding 5% senior notes due in March 2022 in the amount of $748 million. ​ At December 31, 2022, approximately $1.49 billion was available under the company’s long-term, multi-currency committed revolving credit facilities, which are available until June 2027.
At December 31, 2023, approximately $1.69 billion was available under the company’s long-term, multi-currency committed revolving credit facilities. In addition to these facilities, the company had $196 million of committed short-term loans outstanding. The company also had approximately $964 million of short-term uncommitted credit facilities available at December 31, 2023, of which $13 million was outstanding and due on demand.
These amounts represented less than 1 percent and 1 percent of consolidated net sales for 2022 and 2021, respectively.
These amounts represented 1 percent and less than 1 percent of consolidated net sales for 2023 and 2022, respectively. The amounts in 2023 included facility shutdown costs, transaction costs related to the sale of the aerospace business and a foreign exchange loss associated with the company’s Argentina business.
Additional details about our debt are available in Note 15 to the consolidated financial statements within Item 8 of this annual report. ​ Defined Benefit Pension Plans ​ The company closed its pension plans to all non-unionized new entrants in the United States effective for anyone hired after December 31, 2021.
Additional details about our debt are available in Note 15 accompanying the consolidated financial statements within Item 8 of this annual report. ​ Defined Benefit Pension Plans ​ In November 2023, the Trustee Board of the U.K. defined benefit pension plan entered into an agreement with an insurance company for a bulk annuity purchase, or “buy-in,” for its U.K. defined benefit pension plan to reduce retirement plan risk, while delivering promised benefits to plan participants.
In 2023 we expect to improve year-over-year financial results through fixed cost savings from rightsizing production. ​ Aerospace ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ($ in millions) ​ 2022 2021 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 1,977 ​ $ 1,911 ​ $ 1,741 ​ Comparable operating earnings ​ ​ 170 ​ ​ 169 ​ ​ 153 ​ Comparable operating earnings as a % of segment net sales ​ ​ 9 % ​ 9 % ​ 9 % ​ Segment sales in 2022 were $66 million higher compared to 2021, and comparable operating earnings were $1 million higher, primarily due to the company’s new program wins, backlog growth and related backlog liquidation through contract performance, offset by supply chain inefficiencies and cost increases/inflationary pressures during 2022. ​ Sales to the U.S. government, either directly as a prime contractor or indirectly as a subcontractor, represented 98 percent of segment sales in 2022 and 97 percent in 2021.
Comparable operating earnings were $49 million higher, primarily due to a $31 million increase from favorable contract mix and an $18 million increase from operational performance. ​ 30 Table of Contents Sales to the U.S. government, either directly as a prime contractor or indirectly as a subcontractor, represented 98 percent of segment sales in 2023 and 2022.
We also provide aerospace and other technologies and services to governmental and commercial customers, including national defense hardware, antenna and video tactical solutions, civil and operational space hardware and system engineering services. ​ We sell our aluminum packaging products mainly to large, multinational beverage, personal care and household products companies with which we have developed long-term relationships.
See Note 4 for further details. ​ We sell our aluminum packaging products mainly to large, multinational beverage, personal care and household products companies with which we have developed long-term relationships. This is evidenced by our high customer retention and our large number of long-term supply contracts.
Paul, Minnesota. The Phoenix facility ceased production in the fourth quarter of 2022, and the St.
Paul, Minnesota in the first quarter of 2023 and permanently ceased production at its aluminum beverage can manufacturing facility in Wallkill, New York in the third quarter of 2023.
Paul facility ceased production in the first quarter of 2023. ​ Segment sales in 2022 were $840 million higher compared to 2021 primarily due to the pass through of higher aluminum prices, partially offset by unfavorable price/mix. ​ Comparable operating earnings in 2022 were $39 million lower compared to 2021 primarily due to unfavorable fixed cost absorption, higher inflationary costs and unfavorable customer mix, partially offset by favorable contractual terms, cost pass throughs and lower depreciation expense associated with the third quarter 2022 revision of estimated useful lives.
Additionally, the company announced it will permanently cease production at its aluminum beverage can manufacturing facility in Kent, Washington in the first half of 2024, and has permanently discontinued plans to construct the North Las Vegas beverage can plant. ​ Segment sales in 2023 were $733 million lower compared to 2022 primarily due to a $408 million decrease from lower volumes and a $325 million decrease from lower sales prices resulting mainly from lower aluminum prices net of the annual pass-through of inflationary costs. ​ Comparable operating earnings in 2023 were $68 million higher compared to 2022 primarily due to $54 million of fixed cost savings from rightsizing production through the facility actions noted above, $32 million of income recognized from the termination of a long term power supply contract that offsets higher energy costs, a $25 million increase from higher sales prices resulting mainly from the annual pass-through of inflationary costs net of current year inflation and $21 million of lower depreciation expense associated with the third quarter 2022 revision of estimated useful lives, partially offset by an $109 million decrease from lower volumes.
These reductions were partially offset by an increase of 2.3 percent for U.S. state and local taxes and by 1.6 percent for equity compensation related impacts.
These reductions were partially offset by an increase of 13.0 percent for changes in valuation allowances.
Removed
We also have exposure to inflation, in particular the rising costs of raw materials, as well as other direct cost inputs.
Added
We also provide aerospace and other technologies and services to governmental and commercial customers. In the third quarter of 2023, Ball entered into a Stock Purchase Agreement with BAE Systems, Inc. (BAE), to sell all of the outstanding equity interests in Ball’s aerospace business to BAE. On February 16, 2024, the company completed the divestiture of the aerospace business.
Removed
Since launching Drive for 10 in 2011, we have made progress on each of the levers as follows: ​ ● Maximizing value in our existing businesses by leveraging our aluminum container production capabilities across our global plant network to meet global demand, improving efficiencies and amplifying our sustainability credentials through Aluminum Stewardship Initiative certification across our global aluminum container and end facilities in North America, South America and Europe; leveraging plant floor and integrated planning systems to reduce costs and manage contractual provisions across our diverse customer base; successfully acquiring and integrating a large global aluminum beverage business and regional aluminum aerosol facility while also divesting underperforming assets; and in the aluminum aerosol business, installing new extruded aluminum aerosol lines in our European, Mexican and Indian facilities while also implementing cost-out and value-in initiatives across all of our businesses; ​ ● Expanding further into new products and capabilities through delivering the broadest aluminum beverage and bottle portfolio, commercializing our lightweight, infinitely recyclable aluminum cup and providing next-generation extruded aluminum aerosol packaging that utilizes proprietary technology to significantly lightweight our products; and successfully introducing new specialty beverage cans and aluminum bottle-shaping technology; ​ ● Aligning ourselves with the right customers and markets by prudently investing capital to meet continued growth for specialty beverage containers throughout our global network, which represent approximately 50 percent of our global beverage packaging mix; aligning with growing beverage customers and brand categories and other new beverage producers who continue to use aluminum beverage containers to grow their business; and in our aluminum cup business, establishing partnerships with food service providers, fast casual restaurants and event venues and utilizing online platforms and North American retailers to provide infinitely recyclable aluminum cups directly to consumers. ​ ● Broadening our geographic reach with our acquisition of Rexam in June 2016 and our new investments in beverage manufacturing facilities in the United States, Brazil, Paraguay, Spain, Czech Republic, United Kingdom, Mexico, Myanmar and Panama, as well as extruded aluminum aerosol manufacturing facilities in North America, Europe, India and Brazil, and the start-up of our aluminum cups business in the U.S.; and ​ ● Leveraging our technological expertise in packaging innovation, including the introduction of our new proprietary, brandable lightweight aluminum cup and providing next-generation aluminum bottle-shaping technologies for new categories, occasions and refillable offerings through the increased production of lightweight ReAl® containers and which utilize technology that increases the strength of aluminum used in the manufacturing process while lightweighting the can by up to 30 percent over a standard aluminum aerosol can, as well as leveraging our aerospace technologies and competencies to deliver exquisite space-based environmental, weather and defense monitoring solutions such as methane monitoring, weather prediction, LIDAR capabilities and hypersonics to preserve and protect our planet through enabling our aerospace customers with actionable ecosystem-related and intelligence data and resilient national security architectures. ​ These ongoing business developments help us stay close to our customers while expanding and/or sustaining our industry positions and global reach with major beverage, personal care, household products and aerospace customers.
Added
Amortization expense in 2023 and 2022 included $135 million for the amortization of acquired Rexam intangibles.
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In order to successfully execute our strategy and reach our goals, we realize the importance of excelling in the following areas: customer focus, operational excellence, innovation and business development, people and culture focus and sustainability. ​ 27 Table of Contents RESULTS OF OPERATIONS ​ Management’s discussion and analysis for our results of operations on a consolidated and segment basis include a quantification of factors that had a material impact.
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See Note 10 of these consolidated financial statements for additional discussion of the reduction in depreciation resulting from the 2022 revised estimated useful lives.
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In 2023 we expect to improve year-over-year results through fixed cost savings from rightsizing production and the contractual recovery of 2022 inflationary costs. ​ Cost of Sales (Excluding Depreciation and Amortization) ​ Cost of sales, excluding depreciation and amortization, was $12,766 million in 2022 compared to $11,085 million in 2021.
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See Note 4 for details and quantification regarding the sale of the Russian operations. ​ Selling, General and Administrative ​ Selling, general and administrative (SG&A) expenses were $558 million in 2023 compared to $626 million in 2022. These amounts represented 4 percent of consolidated net sales for the years ending 2023 and 2022.
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To mitigate these recent cost trends, we have established a commercial cost recovery program that is designed to help us recover a significant portion of those cost increases that fall outside our normal customer contracts.
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(BAE), to sell all of the outstanding equity interests in Ball’s aerospace business to BAE. On February 16, 2024, the company completed the divestiture of the aerospace business.
Removed
These amounts represented 4 percent and 5 percent of consolidated net sales for the years ended 2022 and 2021, respectively.
Added
See Note 4 for further details. ​ Segment sales in 2023 were $10 million lower compared to 2022, primarily due to a $22 million decrease from backlog liquidation timing, partially offset by a $12 million increase from favorable contract mix.
Removed
See Note 4 for details regarding the sale of the Russian operations. ​ Effective July 1, 2022, Ball revised the estimated useful lives of all of its equipment and buildings included in the analysis, which resulted in a net reduction in depreciation expense of approximately $49 million ($37 million after tax, or $0.12 per diluted share) for the year ended December 31, 2022, as compared to the amount of depreciation expense that would have been recognized by utilizing the prior depreciable lives.
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On February 16, 2024, the company completed the divestiture of the aerospace business. We currently estimate a cash tax of $1.0 billion to be recorded as a cash outflow from operations in 2024. See Note 4 for further details.
Removed
This change in useful lives is expected to reduce depreciation expense by approximately $49 million for the six months ended June 30, 2023, for those assets included in the revision analysis. ​ Selling, General and Administrative ​ Selling, general and administrative (SG&A) expenses were $626 million in 2022 compared to $593 million in 2021.
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In an elevated interest rate environment, payment terms with our customers and vendors become a more important element of total mix of information used to negotiate our contract terms.
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These amounts represented 4 percent of consolidated net sales for 2022 and 2021.
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At December 31, 2023, days sales outstanding, net of factored receivables, was 62 days; therefore, a change of one day in days sales outstanding will impact cash flows provided by (used in) operating activities by $38 million.
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The amounts in 2021 included a non-cash pension settlement charge of $135 million and gains resulting from Brazilian indirect tax rulings of $22 million.
Added
At December 31, 2023, days payable outstanding was 118 days; therefore, a change of one day in days payable outstanding will impact cash flows provided by (used in) operating activities by $30 million.
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The remaining sales were for time and materials contracts. ​ 31 Table of Contents Backlog for the aerospace segment at December 31, 2022 and 2021, was $2.97 billion and $2.47 billion, respectively. The actual amount of funding received in the future may be higher or lower than our estimate of potential contract value.
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At December 31, 2023, days inventory outstanding was 32 Table of Contents 52 days; therefore, a change of one day in days inventory outstanding will impact cash flows provided by (used in) operating activities by $30 million. ​ Cash flows used in investing activities were $1,053 million in 2023 primarily driven by $1.05 billion in capital expenditures.
Removed
In comparison to the same period in 2021, and after adjusting for the impact of capital expenditures, our working capital movements reflect an increase in days sales outstanding of 7 days in 2022, an increase in inventory days on hand of 14 days in 2022 and a decrease in days payable outstanding of 6 days in 2022. ​ Cash outflows from investing activities were $786 million in 2022 predominantly driven by $1.65 billion in capital expenditures, partially offset by $455 million net cash received for the sale of our Russian aluminum beverage packaging business, net of the cash on the disposed business, and $298 million received for the for the sale of our remaining 49 percent owned equity investment in Ball Metalpack. 33 Table of Contents Cash inflows from financing activities were $485 million in 2022, primarily driven by the issuance of $750 million of 6.875% senior notes due 2028, $394 million of borrowings under short-term uncommitted credit facilities and $200 million of borrowings under the company’s long-term revolving facility, partially offset by the repayment of $738 million of 4.375% senior notes, net share repurchases of $582 million and common stock dividends of $254 million. ​ We have entered into several regional committed and uncommitted accounts receivable factoring programs with various financial institutions for certain of our accounts receivable.
Added
On February 16, 2024, the company completed the divestiture of the aerospace business. The proceeds from the sale will be recorded as a cash inflow from investing activities in 2024.
Removed
A total of $488 million and $308 million were available for sale under these programs at December 31, 2022 and 2021, respectively. ​ As of December 31, 2022, approximately $546 million of our cash was held outside of the U.S.
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See Note 4 for further details. ​ Cash flows used in financing activities were $662 million in 2023, primarily driven by the repayment of $1.00 billion of 4.00% senior notes, the $210 million net repayment of short-term loans, a net revolver repayment of $200 million and common stock dividends of $252 million, partially offset by the issuance of $1.00 billion of 6.00% senior notes due in 2029.
Removed
Total interest-bearing debt of $9.00 billion and $7.78 billion was outstanding at December 31, 2022 and 2021, respectively. ​ During 2022, Ball issued $750 million of 6.875% senior notes due in 2028, redeemed $738 million of outstanding euro denominated 4.375% debt and completed the closing of its new revolving and term loan senior secured credit facilities that refinanced its existing senior secured credit facilities entered into in 2019.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+6 added−1 removed7 unchanged
Biggest changeFirst, we enter into container sales contracts that include aluminum-based pricing terms that generally reflect the same price fluctuations included in commercial purchase contracts for aluminum sheet. The terms include fixed, floating or pass-through aluminum component pricing.
Biggest changeThe results of the sensitivity analyses are summarized below. ​ Commodity Price Risk ​ Aluminum ​ We manage commodity price risk in connection with market price fluctuations of aluminum through two different methods. First, we enter into container sales contracts that include aluminum-based pricing terms that generally reflect the same price fluctuations under commercial purchase contracts for aluminum sheet.
Sales contracts are negotiated with customers to reflect cost changes and, where there is not an exchange pass-through arrangement, the company may use derivative instruments to manage significant currency exposures. ​ Considering the company’s derivative financial instruments outstanding at December 31, 2022, and the various currency exposures, a hypothetical 10 percent reduction (U.S. dollar strengthening) in currency exchange rates compared to the U.S. dollar would result in an estimated $15 million after-tax reduction in net earnings over a one-year period.
Sales contracts are negotiated with customers to reflect cost changes and, where there is not an exchange pass-through arrangement, the company may use derivative instruments to manage significant currency exposures. ​ Considering the company’s derivative financial instruments outstanding at December 31, 2023, and the various currency exposures, a hypothetical 10 percent reduction (U.S. dollar strengthening) in currency exchange rates compared to the U.S. dollar would result in an estimated $15 million after-tax reduction in net earnings over a one-year period.
Second, we use derivative instruments as economic and cash flow hedges of commodity price risk where there are material differences between sales and purchase contracted pricing and volume. ​ Considering the effects of derivative instruments, the company’s ability to pass through certain raw material costs through contractual provisions, the market’s ability to accept price increases and the company’s commodity price exposures under its contract terms, a hypothetical 10 percent adverse change in the company’s aluminum prices would result in an estimated $3 million after-tax reduction in net earnings over a one-year period.
Second, we use certain derivative instruments, including option and forward contracts, as economic and cash flow hedges of commodity price risk where there are material differences between sales and purchase contracted pricing and volume. ​ Considering the effects of derivative instruments, the company’s ability to pass through certain raw material costs through contractual provisions, the market’s ability to accept price increases and the company’s commodity price exposures under its contract terms, a hypothetical 10 percent adverse change in the company’s aluminum prices would result in an estimated $3 million after-tax reduction in net earnings over a one-year period.
Interest rate instruments held by the company at December 31, 2022, included pay-fixed interest rate swaps and options which effectively convert variable rate obligations to fixed-rate instruments. ​ Based on our interest rate exposure at December 31, 2022, assumed floating rate debt levels throughout the next 12 months and the effects of our existing derivative instruments, a 100-basis point increase in interest rates would result in an estimated $10 million after-tax reduction in net earnings over a one-year period.
Interest rate instruments held by the company at December 31, 2023, included pay-fixed interest rate swaps and options which effectively convert variable rate obligations to fixed-rate instruments. ​ Based on our interest rate exposure at December 31, 2023, assumed floating rate debt levels throughout the next 12 months and the effects of our existing derivative instruments, a 100-basis point increase in interest rates would result in an estimated $7 million after-tax reduction in net earnings over a one-year period.
Actual results may vary based on actual changes in market prices and rates and the timing of these changes. ​ Currency Exchange Rate Risk ​ Our objective in managing exposure to currency fluctuations is to limit the exposure of cash flows and earnings from changes associated with currency exchange rate changes through the use of various derivative contracts.
Actual results may vary based on actual changes in market prices and rates and the timing of these changes. ​ 38 Table of Contents Currency Exchange Rate Risk ​ Our objective in managing exposure to currency fluctuations is to limit the exposure of cash flows and earnings from changes associated with currency exchange rate changes through the use of various derivative contracts.
Actual results may vary based on actual changes in market prices and rates. ​ Interest Rate Risk ​ Our objective in managing exposure to interest rate changes is to minimize the impact of interest rate changes on earnings and cash flows and to minimize our overall borrowing and receivables factoring costs.
Actual results may vary based on actual changes in market prices and rates. ​ Interest Rate Risk ​ Our objective in managing exposure to interest rate changes is to minimize the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs.
In addition, at times Ball manages earnings translation volatility through the use of currency derivative strategies, and the change in the fair value of those derivatives is recorded in the company’s net earnings. Our currency translation risk results from the currencies in which we transact business.
In addition, at times Ball manages earnings translation volatility through the use of currency option strategies, and the change in the fair value of those options is recorded in the company’s net earnings. Our currency translation risk results from the currencies in which we transact business.
To achieve these objectives, we may use a variety of derivative instruments to manage our mix of floating and fixed-rate debt.
To achieve these objectives, we may use a variety of interest rate swaps, collars and options to manage our mix of floating and fixed-rate debt.
A hypothetical 10 percent adverse change in the U.S. dollar’s currency exchange rates would increase our forecasted average debt balance by approximately $170 million. Actual changes in market prices or rates may differ from hypothetical changes. ​ ​ 38 Table of Contents
A hypothetical 10 percent adverse change in the U.S. dollar’s currency exchange rates would increase our forecasted average debt balance by approximately $165 million. Actual changes in market prices or rates may differ from hypothetical changes. ​ Although Ball's functional currency in Argentina is the U.S. dollar, a portion of its transactions are denominated in pesos.
Removed
The results of the sensitivity analyses are summarized below. ​ 37 Table of Contents Commodity Price Risk ​ Aluminum ​ We manage commodity price risk in connection with market price fluctuations of aluminum through two different methods.
Added
The terms include fixed, floating or pass through aluminum component pricing.
Added
The company is currently placing increased importance on managing its currency exchange rate risk in Argentina given the devaluation of the country’s currency. This devaluation and economic conditions in Argentina make it difficult to manage currency exchange rate risk, and have an adverse effect on the company’s results of operations.
Added
Ball’s Argentinean business, which is presented in its beverage packaging, South America, reportable operating segment, represented approximately 1 percent of the company's total comparable operating earnings for the year ended December 31, 2023.
Added
In addition, our plant in Argentina accounted for approximately 2 percent of the company's 105 billion global beverage can unit shipments for the year ended December 31, 2023. During the fourth quarter of 2023, Argentina suddenly devalued its peso relative to the U.S. dollar by approximately 55%.
Added
As a result, Ball recorded a $22 million devaluation charge in business consolidation and other activities in the consolidated statement of earnings. Ball’s peso-denominated net assets in Argentina were approximately $20 million at December 31, 2023.
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As of December 31, 2023, Ball’s Argentinean business had net asset exposure of $404 million, which consisted primarily of working capital and property, plant and equipment. ​ ​ ​ 39 Table of Contents

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