George Staphos: So I wanted to come back to the question on end markets and trends you would expect for the rest of the year to the extent that you can comment. One, are there any categories without giving away information as proprietary that you expect will be particularly helpful and particularly a headwind to your volume outlook for the rest of the year? Relatedly, you mentioned, Dan, the beer category and there’s been lots of news there. What are you seeing in terms of your relative share of beer relative to what is happening to perhaps your mix or your customer mix? And then I had a couple of follow-ons.
Dan Fisher: Sure. Let me take the second part of the beer question first. As you know, George, you have been following us a long time. We have an overweight in beer and we love all our beer customers and we serve that market. So net-net-net and I know the specifics and I am not going to go into the specifics relative to customers. But I will tell you this, how you should look at Ball’s portfolio as it relates to beer is, we win when folks drink beer. And so if there’s a mix impact. We may have a — we may have one customer that’s up, in a short period of time there may be a share shift, we pick up both sides of that equation generally. So what we are more interested in is the health of the entire category and we believe that beer is going to need to galvanize itself and push in the second half of the year. They are going to have to promote across the entirety of the industry.
George Staphos: And on the end market trends and it’s been a long earnings season, so we are trying to help you…
Dan Fisher: Yeah. And in the…
George Staphos: …ask them later this weekend but…
Dan Fisher: In the category space, I don’t anticipate any significant wins or significant losses by category. What I — in my prior answer to the prior question, I will reiterate. I think, there will be a share shift that happens in each category, depending on the approach that each brand owner takes and so folks that have decided to not pass on price increases aggressively, if you will, have done better on share gain over the last 12 months to 18 months. So if they have taken a posture where they are going to pass-through a portion, but not pass-through what everybody else in the category is Zoom, they are the ones that are winning share and so depending on what decision you are making within the category, I think it’s going to be a share shift within the category.
I think every category is going to do well and some will do a little better than others, but it’s really going to be the customers that win within categories. That will be the determining factor on our volume versus our competitor’s volume.
Scott Morrison: George, the only thing I would add is, long-term, the positive — the best positive here is the can is winning, new product introductions are still heavily weighted to cans and so that bodes well for the can in the long run and that’s we are playing a long game here.
George Staphos: Understood. Two questions and I will turn it over. One, on aerospace, can you talk to the degree that you can sustain the performance that you saw in 1Q, after what was — obviously a little bit of a challenging 2022, whether this is kind of a one-off one quarter hit or benefit or you think you can maintain that into the rest of the year and hopefully 2024? And then back to beverage cans and capacity, can you talk to what you think operating rates will be this year? And Scott, should we really be expecting CapEx in 2024 in the range of $550 million to $600 million based on what you said on D&A? Thank you and good luck in the quarter.
Dan Fisher: Thank you. So aerospace, I think the way you think about aerospace is that, I wouldn’t do a run rate on sequential improvement, meaning quarter two being better than quarter one. But I would say the quarters year-over-year will be improved. There is real underlying improvement in performance. In the second half of last year we had some pretty significant supply chain disruption. So that has been fixed. And then what you saw in the first quarter was a really nice performance execution and a couple of nice breaks in terms of just efficiency gains and just a better run enterprise there in the first quarter. So I think that will continue to be a tailwind in each quarter. It just — it won’t be sequential lifts, right, it will be dependent on the projects and the mix. But that business is poised to do have an exceptional year this year. And I will let Scott tackle the efficiency question.
Scott Morrison: Sure, George. On the D&A, I said GAAP D&A for CapEx.
George Staphos: Okay.
Scott Morrison: Not the comparable operating earning ones.
George Staphos: Okay. Got it. Got it. Thank you for that. And operating rates this year?
Scott Morrison: Operating rates, we are running our plants. I mean we are taking downtime and we are taking more of it in the second quarter to make sure that we are operating at pretty high levels of above 90%. So we will take downtime in Q2 in North America and South America. South America, that’s pretty typical given the seasonality of that business, but we are really focused in Q2 on getting our inventories to the right level and so we can run it — and run at fairly high operating rates for the year and so that will be a bit — that will be a drag in Q2.
George Staphos: Understood. Thank you, guys.
Scott Morrison: Thanks.
Dan Fisher: Thank you.
Operator: Thank you. The next question comes from Angel Castillo of Morgan Stanley. Please go ahead.
Angel Castillo: Hey. Sorry. Can you hear me?
Dan Fisher: Yes. Hi, Angel.
Angel Castillo: Hey. Thanks for taking my question. Just wanted to follow up on the commentary around downtime in 2Q. Could you quantify what the drag will be from that and kind of related as you think about the kind of — just cost or operational leverage that your business has to volumes potentially improving as kind of promotional activity returns. Just could you talk about maybe the degree to which some of that is maybe variable and comes back as you bring assets back online versus how much is just operating leverage that would be upside to our volume?
Dan Fisher: Sure. Well, first of all, congratulations on being a new dad and how quickly…
Angel Castillo: Thanks.
