Business Segment Information

12 Months Ended

Dec. 31, 2019

3. Business Segment Information

Ball’s operations are organized and reviewed by management along its product lines and geographical areas and presented in the four reportable segments outlined below:

Beverage packaging, North and Central America: Consists of operations in the U.S., Canada and Mexico that manufacture and sell metal beverage containers throughout those countries.

Beverage packaging, South America: Consists of operations in Brazil, Argentina, Chile and Paraguay that manufacture and sell metal beverage containers throughout most of South America.

Beverage packaging, Europe: Consists of operations in numerous countries in Europe, including Russia, that manufacture and sell metal beverage containers throughout most of Europe.

Aerospace: Consists of operations that manufacture and sell aerospace and other related products and provide services used in the defense, civil space and commercial space industries.

As presented in the tables below, Other consists of non-reportable segments located in Africa, Middle East and Asia (beverage packaging, AMEA) and Asia Pacific (beverage packaging, Asia Pacific) that manufacture and sell metal beverage containers; a non-reportable segment that manufactures and sells aerosol containers, extruded aluminum aerosol containers and aluminum slugs (aerosol packaging); undistributed corporate expenses; intercompany eliminations and other business activities.

The accounting policies of the segments are the same as those in the consolidated financial statements, as discussed in Note 1. The company also has investments in operations in Guatemala, Panama, South Korea, the U.S. and Vietnam that are accounted for under the equity method of accounting and, accordingly, those results are not included in segment sales or earnings.

Beginning in January 2020, Ball has changed how the beverage packaging, AMEA, and beverage packaging, Asia Pacific, operating segments are being managed and reported for the purposes of cost reduction and operational efficiency. The plants in Cairo, Egypt, and Manisa, Turkey, will be consolidated with the existing reportable beverage packaging, Europe, operating segment. The company’s operations in India and Saudi Arabia will be managed with the remainder of the beverage packaging, Asia Pacific, operating segment resulting in a new non-reportable beverage packaging, other, operating segment. The 2019 results for the Aluminum Cups business were reported in undistributed corporate expenses. Beginning in January 2020, the Aluminum Cups business will be a non-reportable operating segment. These changes will be reflected in the segment financial reporting beginning the first quarter of 2020 including comparative historical periods.

Major Customers

Net sales to major customers, as a percentage of consolidated net sales, were as follows:


	2019		2018		2017

U.S. Government	13	%	10	%	9	%
Anheuser-Busch InBev and affiliates	12	%	13	%	14	%
Coca-Cola Bottlers' Sales & Services Company LLC and affiliates	9	%	12	%	11	%

Summary of Net Sales by Geographic Area (a)


($ in millions)	U.S.		Brazil		Other		Consolidated

2019	$	5,747	$	1,351	$	4,376	$	11,474
2018		5,783		1,380		4,472		11,635
2017		5,496		1,427		4,060		10,983

(a)	Revenue is attributed based on origin of sale and includes intercompany eliminations.

Summary of Net Long-Lived Assets by Geographic Area (a)


($ in millions)	U.S.		Brazil		U.K.		Other		Consolidated

As of December 31, 2019	$	2,024	$	750	$	626	$	2,655	$	6,055
As of December 31, 2018		1,708		865		701		2,677		5,951

(a)	Long-lived assets exclude goodwill and intangible assets.

Summary of Business by Segment


	Years Ended December 31,
($ in millions)	2019		2018		2017

Net sales
Beverage packaging, North and Central America	$	4,758	$	4,626	$	4,178
Beverage packaging, South America		1,670		1,701		1,692
Beverage packaging, Europe		2,651		2,619		2,360
Aerospace		1,479		1,196		991
Reportable segment sales		10,558		10,142		9,221
Other		916		1,493		1,762
Net sales	$	11,474	$	11,635	$	10,983

Comparable operating earnings
Beverage packaging, North and Central America	$	555	$	551	$	533
Beverage packaging, South America		288		313		333
Beverage packaging, Europe		308		282		233
Aerospace		140		113		98
Reportable segment comparable operating earnings		1,291		1,259		1,197
Reconciling items
Other (a)		40		31		23
Business consolidation and other activities		(244)		(191)		(221)
Amortization of acquired Rexam intangibles		(155)		(164)		(162)
Catch-up depreciation and amortization for 2016 from finalization of Rexam valuation		—		—		(35)
Earnings before interest and taxes		932		935		802
Interest expense		(317)		(301)		(285)
Debt refinancing and other costs		(7)		(1)		(3)
Total interest expense		(324)		(302)		(288)
Earnings before taxes		608		633		514

(a)	Includes undistributed corporate expenses, net, of $54 million, $85 million and $128 million for the years ended December 2019, 2018 and 2017, respectively.


	Years Ended December 31,
($ in millions)	2019		2018		2017

Depreciation and amortization (a)
Beverage packaging, North and Central America	$	190	$	184	$	179
Beverage packaging, South America		136		131		144
Beverage packaging, Europe		231		238		254
Aerospace		43		33		31
Reportable segment depreciation and amortization		600		586		608
Other		78		116		121
Depreciation and amortization	$	678	$	702	$	729

Capital expenditures
Beverage packaging, North and Central America	$	139	$	322	$	283
Beverage packaging, South America		150		106		36
Beverage packaging, Europe		144		194		81
Aerospace		96		130		70
Reportable segment capital expenditures		529		752		470
Other		69		64		86
Capital expenditures	$	598	$	816	$	556

(a)	Includes amortization of acquired Rexam intangibles.

The company does not disclose total assets by segment as it is not provided to the chief operating decision maker.