Aptargroup Inc Q4 2024 Earnings Call Transcript

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 can hear me okay. Stephan, Mary, good morning. Vanessa, welcome. My two questions. First of all, can you talk a little bit about the green shoots that you are seeing in China? And what momentum, what impact that might be able to have to generate for 2025? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 07, 2025 / 2:00PM, ATR.N - Q4 2024 Aptargroup Inc Earnings Call The second question, recognizing it's tough to call, if you held currency rates where they're at and taxes do what you expect them, do you expect that earnings per share will grow in 2025 off a very tough comparison '24. Would that be too difficult, maybe a different way to handle the question. If we exclude those effects, what -- how would you define solid earnings per share growth. Thanks guys, good luck in the quarter.

Question: George Staphos - Bank of America - Analyst : Vanessa is the tax -- is it only a 1Q effect? Or does it impact the whole of the year? Thank you, sorry for that. And again good luck in the quarter.

Question: George Staphos - Bank of America - Analyst : All right. Thanks so much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 07, 2025 / 2:00PM, ATR.N - Q4 2024 Aptargroup Inc Earnings Call

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Yeah, thanks. Good morning everyone. Vanessa, just following up on George's question on the EPS bridge items. So if currency holds at current levels, what sort of year-over-year headwind would that be on EPS? The same with tax? And then in corporate, 4Q was quite a bit lower than the trend line from previous quarters. How should we think about that as a variance for '25 versus '24?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Yes. So I meant for 2025 versus 2024. 2024 baseline EPS is $5.64, the variances for FX, tax and corporate.

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Okay. And then the corporate below trend for 4Q, what was that due to?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Got it. And in terms of just second question, I guess, in terms of the destocking that you're seeing in cold and flu and the time line for that to sort of normalize? And then also in Prestige, you called out weakness, I think, in the EMEA region as well. Just based on some of the customers that are reported, it seems like volumes seem relatively stable across the board from a customer level standpoint. So what is going on there specific to Aptar?

Question: Ghansham Panjabi - Robert W. Baird & Co - Analyst : Thanks so much.

Question: Matt Roberts - Raymond James - Analyst : Hi, Stephan, Vanessa. Good morning. Stephan, you noted that expecting a more gradual ramp-up in injectables. I believe last quarter, you said that, that business could tend to be high single digits to low single digits based on GLP and biologics growth, albeit stopping short of any official guide there. But based on the new ramp-up expectations, do you have better ability or comfort in firming what that injectables core sales growth number could look like in 2025 or given strong underlying growth rates in those drugs, what factors could dictate either coming in above or below any expectation?

Question: Matt Roberts - Raymond James - Analyst : Okay. That's helpful. And then maybe on the proprietary delivery systems side, 2024 had continued strong performance, and you noted that category will lead the Pharma segment. So as you look '25, what type of growth do you think is achievable there? And as we've heard positive commentary on some of the newer drugs had, whether that's Spravato or neffy coming out of the gate in 4Q. Would you say that 2025 growth in proprietary is more so dependent on further new drugs into the market or more so underlying secular trends for nasal delivery and drugs that are already on the market?

Question: Matt Roberts - Raymond James - Analyst : Great. Thank you again.

Question: Daniel Rizzo - Jefferies - Analyst : Good morning, everyone. Thank you. Thank you for taking my question. Well the first thing I want to ask you about is tariffs. Obviously, it's a very fluid situation, and I don't expect you have any answer to what's going to happen. But I was wondering what happened last time there were tariffs on Chinese products. If it had any affect to you guys at all? Or not necessarily directly, but also on your customer demand or customer order trends?

Question: Daniel Rizzo - Jefferies - Analyst : Okay. And then you had a pretty solid improvement in ROIC over the last couple of years. I was wondering what -- and maybe you mentioned this in October, something that I forgot. But what the goal is if you had to up to, I don't know, 15% or if there is a goal for that metric?

Question: Daniel Rizzo - Jefferies - Analyst : Thank you very much.

Question: Gabe Hajde - Wells Fargo - Analyst : Stefan, good morning. Vanessa, welcome. I wanted to focus on the capital allocation side of the business. You talked about wrapping up a couple of big investments as we know, to add capacity in Injectables. And I think it's a good thing, but it still seems you guys are kind of guiding 280, 300 per capital. You also gave a slide where you're showing a lot of your internal investments are directed at your Pharma segment. So I think all in, we interpret that as a positive signal. But just any color that you can provide in terms of what options that you're seeing for investment internally?

Question: Gabe Hajde - Wells Fargo - Analyst : And any particular products or discrete things that are in that capital that you guys would want to call out?

Question: Gabe Hajde - Wells Fargo - Analyst : Okay. And then I guess switching gears a little bit. You guys have been pretty active. I think you called out closing, and I apologize if I misheard 10 facilities in Beauty. But just we're current on the other end of what was a multiyear kind of efficiency initiative across the organization. And again, I know you're not always -- you're not done. You're always trying to get better. But as we look forward, do you see anything else that you need to do from a footprint standpoint or cost reduction? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 07, 2025 / 2:00PM, ATR.N - Q4 2024 Aptargroup Inc Earnings Call

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