Ardagh Metal Packaging's 2025 Q1 Earnings Call: Unpacking Contradictions in Demand, Growth, and Capacity

Impact of tariffs and inflation on demand, growth expectations in the U.S., North American energy drink demand, capacity utilization, and energy drink demand and recovery are the key contradictions discussed in Ardagh Metal Packaging's latest 2025Q1 earnings call.



Strong Quarterly Performance:
- Ardagh Metal Packaging reported 6% global shipments growth and 16% adjusted EBITDA growth, both ahead of initial guidance, for the first quarter of 2025.
- The growth was driven by higher volumes, improved fixed cost absorption, and strong performance across business segments, particularly in North America and Brazil.

North American Market Strength:
- In North America, shipments increased by 8%, reflecting a portfolio mix of attractive and growing customers and product categories.
- Market demand for nonalcoholic beverages was strong, supported by promotional activity, leading to robust growth in energy drinks and strong double-digit growth in the energy drinks category.

Tariff Impact and Aluminum Pricing:
- The company anticipates minimal impact from announced tariff measures, as suppliers, customers, and end consumers are mostly regional in nature.
- The recent Midwest premium increase had a minimal impact on the beverage can's retail cost, offset by a decline in the LME price, maintaining the overall metal cost position for beverage cans.

European Market Expansion:
- European revenue increased by 10% to $528 million, with a 14% rise on a constant currency basis, driven by volume growth and stronger input cost recovery.
- Despite tight capacity, the positive start supports expectations for shipments growth of 3% to 4% for the full year 2025, supported by recent capacity installations and increased utilization rates.