Aptargroup Inc Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: George Staphos - Bank of America - Analyst : Hi everyone, good morning. Hope you're doing well, thanks for the details. I guess first question I had, Stephan, if you can give us, a little bit more color in terms of what you're seeing in terms of order patterns and inventory levels. You mentioned that you haven't gotten past perhaps the inflection point, in farming restocking, on CHC add and, amend as you wish there just appreciate a bit more color there. And then can you give us a bit more color in terms of what's happening with GLP ones and how that's helping injectables? I don't know if you're going to be in a position to quantify, but if you can give a bit more color there, that would be helpful too. And they had one follow on.

Question: George Staphos - Bank of America - Analyst : Yeah. Point of clarification, you said other areas haven't seen it yet, so meaning outside of the US, you haven't seen cough and cold inventories necessarily depleted. You don't have to go into detail. I just want to make sure I got that right. And then Vanessa, I know tax rates kind of circular. Oh, thank you so much. I know tax rates circular because it relies on the full year and you don't go on the full year, but. If you're in our seats and we need to model after what tax rate would you use broadly for the second half of the year? Thank you.

Question: George Staphos - Bank of America - Analyst : Thank you very much

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Thank you, operator. Good morning, everybody. Just following up on George's questions, on the cold and cough, where do you think the inventory lies? Is it in distribution? Is it in, the upstream in terms of production at the pharmaceutical level? Just any color there, and what is the realistic sort of timeline for that inflection if you kind of look at parallels in the past with the company's gone through these before as well. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, ATR.N - Q1 2025 Aptargroup Inc Earnings Call

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : And so the US was how many quarters? You mentioned an inflection, how many quarters was the correction you think?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Got it. Okay, thank you for that. And then in terms of GLP-1 and your targets you outlined a couple of years ago at your analyst meeting about, doubling the sales base, etc. How does the potential for an oral pill change the calculus of that, if at all?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Got it. And just one final one, the divergence in sales between mass fragrances and prestige. Is that just a bit more color on that in terms of your share position, is it obviously different one versus the other, or is it just the market conditions and maybe customer mix?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Okay, perfect. Thank you so much.

Question: Matt Roberts - Raymond James - Analyst : Hey Stefan, Vanessa. Good morning, everybody. If I could first expand on Ghansham's question there on the prestige fragrance, I believe you said it was isolated to Europe, but are you seeing the early impacts of lower discretionary spending amongst that prestige income cohort, or are your customers passing along tariff related price already that is being absorbed? And if so, would Aptar or have to share in any of that cost?

Question: Matt Roberts - Raymond James - Analyst : That's so fun, thank you. Maybe if I could if I have to ask a more holistic question, because I can't keep up with regulatory agent headlines and whether the odds or pace of drug approvals is any better or worse, and I'm not sure you can make that easier for me, but when you think about the longer term 7% to 11% core growth in pharma. How does the evolving approach of regulatory change your conviction on that here in the medium term, maybe in the next two to three years, or are there certain areas you're more or less comfortable with in the pipeline, given your customers and spend small REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, ATR.N - Q1 2025 Aptargroup Inc Earnings Call biotech companies to very large pharma companies and how is each end of that customer range approaching their respective pipelines. Thanks for taking the questions.

Question: Matt Roberts - Raymond James - Analyst : Appreciate that and for providing a little comfort going over the weekend. Thank you, Stephan.

Question: Daniel Rizzo - Jefferies - Analyst : Hey, thank you for taking my question. And just to kind of -- how are you doing? Just to kind of go with the tariff thing. Is it also possible that the tariffs could have a benefit for, I mean, from my understanding in beauty, you produce in Europe or your end products are in Europe and they are shipped to China. Are we seeing or can we see that demand go up because of issues between the US and the rest of the world if you kind of follow what I'm saying?

Question: Daniel Rizzo - Jefferies - Analyst : Okay. And then you mentioned tough comps and injectables. I was wondering, I think in Q1, I was wondering if that's something that's going to be kind of an issue or just something that's highlighted for the remainder of the year.

Question: Daniel Rizzo - Jefferies - Analyst : Okay. And then finally, with FX, you guided to 1.14. What was, I guess, the average rate in Q1? Was it like 108 or 109? What, what's the kind of the change or that, that's what's expected versus what was?

Question: Daniel Rizzo - Jefferies - Analyst : That's perfect. That's exactly what I was looking for. Thank you.

Question: Matt Larew - William Blair & Company - Analyst : Good morning. I wanted to follow up on growth in pharma. Obviously, you've called out the, sort of the cough and cold destock. But you've, we also referenced on the call continued strength on the emergency med NARCAN side. If I think about the last decade here, you, the CAGR is around 9%, sort of right in that 7% to 11% range, but the quarters themselves, particularly over the last couple of years have been much choppier. Maybe if we think about the next few quarters as the destock ends, do we get back to a more normal, cadence, maybe as part of that answer would be good to hear an update on where emergency medicine stands as a percentage of sales. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, ATR.N - Q1 2025 Aptargroup Inc Earnings Call

Question: Matt Larew - William Blair & Company - Analyst : Okay, very good. And then, Vanessa, I just wanted to make sure on tariffs you referenced that the net effect is expected to be limited. Does your guidance or at least what you're thinking about the year incorporate that net effect or does it incorporate sort of a gross effect with an expectation you might mitigate? Then this year, I think that each company seems to be thinking about it differently in terms of the impact they expect versus what they incorporate into their outlook. So I want to make sure we're clear about that.

Question: Matt Larew - William Blair & Company - Analyst : Okay, very good. Thank you for the questions.

Question: Gabe Hajde - Wells Fargo - Analyst : Stefan, Vanessa, good morning. Just one quick point of clarification. Oh, a point of clarification and, maybe a little data point for us. Consumer health care, you talked about some destocking and we've, you were very transparent about it. But I think I'm on your prepared remarks you said US was actually starting to get back to normal in terms of order patterns, rest of the world maybe not so much. Again, we could probably sit here and speculate all day about how things move around and what the inventory supply chain looks like, but how big is that piece of business relative to the US?

Question: Gabe Hajde - Wells Fargo - Analyst : Okay, got it. And then I guess in pharma, maybe what we're all trying to understand is it feels like there's been a little bit of noise across a couple of different product lines. And Vanessa, did you give us specifically the number and I apologize if I missed it, injectable, what the volume was in Q1. But if I'm hearing you correct, we get through sort of this destock and OTC slash consumer healthcare. And is it fair to say, Stephan, that there's nothing that you see sort of over the next 12 to 18 months that would kind of prohibit you from being in that long term window?

Question: Gabe Hajde - Wells Fargo - Analyst : Got it. Thank you.

Question: George Staphos - Bank of America - Analyst : Thanks so much. Two quick follow-ons for me. Stefan, to the extent that you have any view on this, I realize it'd be very difficult to have one with the pressure on the consumer that we keep, hearing about, reading about, obviously, tariff considerations and what that might mean for supply chains and cost material. recognizing On that latter point, Material costs usually aren't that big of a deal for you anyway. Are you seeing any emerging trends in terms of the types of constructions that your customers are looking for across any of the key segments, may be less of an issue in pharma, but, perhaps in beauty and or enclosures. And then second question, and I'll turn it over. Overall, what's the outlook over the next quarter, two quarters. If you had a view for '25, we'd obviously love to hear it on sort of tooling and for the appetite for, new products, new opportunities for you as measured by your tool and activity. Thanks and good luck in the quarter.

Question: George Staphos - Bank of America - Analyst : I'm sorry, what was that, Stephan? So everything we just said means that tooling activity is probably doing fairly well given customers are exploring different ways of continuing to differentiate but in in a very sort of quickly evolving world. Would that be a fair summary?

Question: George Staphos - Bank of America - Analyst : Thank you very much.