Business Consolidation and Other Activities

9 Months Ended

Sep. 30, 2022

Business Consolidation and Other Activities

Business Consolidation and Other Activities

6.     Business Consolidation and Other Activities

The following is a summary of business consolidation and other activity (charges)/income included in the unaudited condensed consolidated statements of earnings:

	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2022		2021		2022		2021
Beverage packaging, North and Central America	$	(36)	$	—	$	(37)	$	(1)
Beverage packaging, EMEA		214		(2)		(225)		(5)
Beverage packaging, South America		(9)		(9)		(31)		11
Other		(6)		(130)		270		(141)
	$	163	$	(141)	$	(23)	$	(136)

2022

Beverage Packaging, North and Central America

During the three and nine months ended September 30, 2022, the company recorded charges of $34 million primarily related to employee severance and benefits, accelerated depreciation and other shutdown costs resulting from the planned closure of its Phoenix, Arizona, and St. Paul, Minnesota, facilities in the fourth quarter of 2022, and the first quarter of 2023, respectively. The company also recorded charges of $2 million for the three and nine months ended September 30, 2022, for employee severance and benefit charges related to cost-out activities. Additional charges of $1 million in the nine months ended September 30, 2022, were for individually insignificant activities.

Beverage Packaging, EMEA

During the third quarter of 2022, Ball sold its Russian aluminum beverage packaging business for $530 million of cash and recorded a gain of $222 million. During the second quarter of 2022, Ball recorded a non-cash impairment of $435 million for its Russian long-lived asset group as a result of the Russian invasion of Ukraine. Ball recorded net charges associated with its inability to hedge Russian ruble currency exposures of $3 million for the three and nine months ended September 30, 2022. See Note 4 for further details.

The company also recorded charges of $6 million for the three and nine months ended September 30, 2022, for employee severance and benefit charges related to cost-out activities. Additionally, the company recorded $1 million of credits and $3 million of charges, in the three and nine months ended September 30, 2022, respectively, for individually insignificant activities.

Beverage Packaging, South America

The company recorded charges in the three and nine months ended September 30, 2022, of $8 million primarily related to employee severance and benefits and facility shutdown costs resulting from the closure of its Santa Cruz, Brazil, facility, and $1 million for individually insignificant activities. During the nine months ended September 30, 2022, Ball recorded charges of $22 million related to an increased risk of not being able to fully collect amounts due from a regional customer in Brazil. See Note 21 for further details.

Other

During the three months ended September 30, 2022, the company recorded charges of $6 million for employee severance and benefit charges related to cost-out activities.

During the nine months ended September 30, 2022, the company recorded the following amounts:

● A gain of $298 million related to the sale of Ball’s remaining equity method investment in Ball Metalpack. See Note 4 for further details.

● A charge related to a donation of $30 million to The Ball Foundation, a non-profit philanthropic organization with efforts to build a better world.

● A gain of $16 million from Ball Metalpack’s repayment of a loan which was formerly fully reserved.

● Net charges of $5 million associated with Ball’s inability to hedge Russian ruble currency exposures.

● Charges of $6 million for employee severance and benefit charges related to cost-out activities.

● Charges of $3 million for individually insignificant activities.

2021

Beverage Packaging, North and Central America

During the nine months ended September 30, 2021, the company recorded net charges of $1 million for individually insignificant activities in connection with previously announced closures of certain plants and other activities.

Beverage Packaging, EMEA

During the three and nine months ended September 30, 2021, the company recorded charges of $2 million and $5 million, respectively, for individually insignificant activities in connection with previously announced plant closures, restructuring and other activities.

Beverage Packaging, South America

During the nine months ended September 30, 2021, the company recorded a $22 million gain related to indirect tax gain contingencies in Brazil as these amounts are now estimable and realizable. The company’s Brazilian subsidiaries filed lawsuits in 2014 and 2015 to challenge the Brazilian tax authorities regarding the computation of certain indirect taxes, claiming amounts were overpaid to the tax authorities because the tax base included a “tax on tax” component. During the three and nine months ended September 30, 2021, the company recorded charges of $4 million in connection with previously announced plant closures. Additional charges in the three and nine months ended September 30, 2021, were $5 million and $7 million, respectively, for individually insignificant activities.

Other

During the three months ended September 30, 2021, the company recorded the following amounts:

● A non-cash settlement loss of $130 million related to the purchase of non-participating group annuity contracts and lump-sum payments to settle the projected pension benefit obligations for certain of Ball’s U.S. defined benefit pension plans, which triggered settlement accounting. The settlement loss primarily reflects the third quarter recognition of unamortized actuarial losses in these U.S. pension plans.

During the nine months ended September 30, 2021, the company recorded the following amounts:

● A non-cash settlement loss of $130 million related to the purchase of non-participating group annuity contracts and lump-sum payments to settle the projected pension benefit obligations for certain of Ball’s U.S. defined benefit pension plans, which triggered settlement accounting. The settlement loss primarily reflects the third quarter recognition of unamortized actuarial losses in these U.S. pension plans.

● A loss of $5 million related to the sale of its minority-owned investment in South Korea.

● Charges of $6 million for individually insignificant activities.