Ardagh Group - comment

A year ago we were the most negative in the city on Ardagh’s prospects and yet, the FY results were even worse than that. Management now expects US volumes to be down 10% in 2025 (Europe/Africa will see have mid-single-digit volume growth). Energy prices are guided to be a tailwind for margins in 2025, but we still foresee margin pressure, even with the cost cuts and plant closures. The audit opinion raised serious concerns about whether Ardagh can continue with its current debt load. No surprise there. The company would not comment on the timing of any restructuring proposal to creditors, and we expect that the completion of the Trivium sale will prompt action as it will provide the cash to fund any A&E efforts. We will update our model over the next few days.