Item 1. FINANCIAL STATEMENTS

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

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​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions, except per share amounts)		2022			2021
​	​	​	​	​	​	​
Net sales	​	$	3,716	​	$	3,125
​	​	​	​	​	​	​
Costs and expenses	​	​	​	​	​	​
Cost of sales (excluding depreciation and amortization)	​	​	(3,016)	​	​	(2,493)
Depreciation and amortization	​	​	(185)	​	​	(168)
Selling, general and administrative	​	​	(186)	​	​	(157)
Business consolidation and other activities	​	​	281	​	​	(7)
​	​	​	(3,106)	​	​	(2,825)
​	​	​	​	​	​	​
Earnings before interest and taxes	​	​	610	​	​	300
​	​	​	​	​	​	​
Interest expense	​	​	(69)	​	​	(67)
Debt refinancing and other costs	​	​	—	​	​	—
Total interest expense	​	​	(69)	​	​	(67)
​	​	​	​	​	​	​
Earnings before taxes	​	​	541	​	​	233
Tax (provision) benefit	​	​	(100)	​	​	(32)
Equity in results of affiliates, net of tax	​	​	6	​	​	(1)
Net earnings	​	​	447	​	​	200
Net (earnings) loss attributable to noncontrolling interests	​	​	(1)	​	​	—
Net earnings attributable to Ball Corporation	​	$	446	​	$	200
​	​	​	​	​	​	​
​	​	​	​	​	​	​
Earnings per share:	​	​	​	​	​	​
Basic	​	$	1.39	​	$	0.61
Diluted	​	$	1.37	​	$	0.60
​	​	​	​	​	​	​
​	​	​	​	​	​	​
Weighted average shares outstanding: (000s)	​	​	​	​	​	​
Basic	​	​	320,904	​	​	327,811
Diluted	​	​	325,916	​	​	333,673
​	​	​	​	​	​	​

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See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (LOSS)

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​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Net earnings	​	$	447	​	$	200
​	​	​	​	​	​	​
Other comprehensive earnings (loss):	​	​	​	​	​	​
Currency translation adjustment	​	​	(92)	​	​	(12)
Pension and other postretirement benefits	​	​	8	​	​	41
Derivatives designated as hedges	​	​	67	​	​	46
Total other comprehensive earnings (loss)	​	​	(17)	​	​	75
Income tax (provision) benefit	​	​	(12)	​	​	(18)
Total other comprehensive earnings (loss), net of tax	​	​	(29)	​	​	57
​	​	​	​	​	​	​
Total comprehensive earnings (loss)	​	​	418	​	​	257
Comprehensive (earnings) loss attributable to noncontrolling interests	​	​	(1)	​	​	—
Comprehensive earnings (loss) attributable to Ball Corporation	​	$	417	​	$	257

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See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

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​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Assets	​	​	​	​	​	​
Current assets	​	​	​	​	​	​
Cash and cash equivalents	​	$	437	​	$	563
Receivables, net	​	​	3,128	​	​	2,560
Inventories, net	​	​	2,323	​	​	1,795
Other current assets	​	​	418	​	​	305
Total current assets	​	​	6,306	​	​	5,223
Noncurrent assets	​	​	​	​	​	​
Property, plant and equipment, net	​	​	6,683	​	​	6,502
Goodwill	​	​	4,324	​	​	4,378
Intangible assets, net	​	​	1,627	​	​	1,688
Other assets	​	​	1,986	​	​	1,923
Total assets	​	$	20,926	​	$	19,714
​	​	​	​	​	​	​
Liabilities and Equity	​	​	​	​	​	​
Current liabilities	​	​	​	​	​	​
Short-term debt and current portion of long-term debt	​	$	293	​	$	15
Accounts payable	​	​	5,026	​	​	4,759
Accrued employee costs	​	​	276	​	​	349
Other current liabilities	​	​	891	​	​	830
Total current liabilities	​	​	6,486	​	​	5,953
Noncurrent liabilities	​	​	​	​	​	​
Long-term debt	​	​	8,265	​	​	7,722
Employee benefit obligations	​	​	1,047	​	​	1,205
Deferred taxes	​	​	677	​	​	665
Other liabilities	​	​	494	​	​	484
Total liabilities	​	​	16,969	​	​	16,029
​	​	​	​	​	​	​
Equity	​	​	​	​	​	​
Common stock (681,735,732 shares issued - 2022; 680,944,867 shares issued - 2021)	​	​	1,226	​	​	1,220
Retained earnings	​	​	7,224	​	​	6,843
Accumulated other comprehensive earnings (loss)	​	​	(611)	​	​	(582)
Treasury stock, at cost (361,097,206 shares - 2022; 360,101,024 shares - 2021)	​	​	(3,941)	​	​	(3,854)
Total Ball Corporation shareholders' equity	​	​	3,898	​	​	3,627
Noncontrolling interests	​	​	59	​	​	58
Total equity	​	​	3,957	​	​	3,685
Total liabilities and equity	​	$	20,926	​	$	19,714

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See accompanying notes to the unaudited condensed consolidated financial statements.

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BALL CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

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​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Cash Flows from Operating Activities	​	​	​	​	​	​
Net earnings	​	$	447	​	$	200
Adjustments to reconcile net earnings to cash provided by (used in) operating activities:	​	​	​	​	​	​
Depreciation and amortization	​	​	185	​	​	168
Business consolidation and other activities	​	​	(281)	​	​	7
Deferred tax provision (benefit)	​	​	48	​	​	(2)
Other, net	​	​	(199)	​	​	(147)
Changes in working capital components, net of dispositions	​	​	(1,004)	​	​	(703)
Cash provided by (used in) operating activities	​	​	(804)	​	​	(477)
​	​	​	​	​	​	​
Cash Flows from Investing Activities	​	​	​	​	​	​
Capital expenditures	​	​	(362)	​	​	(363)
Business dispositions, net of cash sold	​	​	298	​	​	1
Other, net	​	​	18	​	​	14
Cash provided by (used in) investing activities	​	​	(46)	​	​	(348)
​	​	​	​	​	​	​
Cash Flows from Financing Activities	​	​	​	​	​	​
Long-term borrowings	​	​	601	​	​	—
Repayments of long-term borrowings	​	​	(1)	​	​	(6)
Net change in short-term borrowings	​	​	277	​	​	7
Proceeds (payments) from issuances of common stock, net of shares used for taxes	​	​	1	​	​	5
Acquisitions of treasury stock	​	​	(98)	​	​	(10)
Common stock dividends	​	​	(65)	​	​	(50)
Cash provided by (used in) financing activities	​	​	715	​	​	(54)
​	​	​	​	​	​	​
Effect of exchange rate changes on cash	​	​	2	​	​	(31)
​	​	​	​	​	​	​
Change in cash, cash equivalents and restricted cash	​	​	(133)	​	​	(910)
Cash, cash equivalents and restricted cash - beginning of period	​	​	579	​	​	1,381
Cash, cash equivalents and restricted cash - end of period	​	$	446	​	$	471

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See accompanying notes to the unaudited condensed consolidated financial statements.

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1**. Basis of Presentation**

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The accompanying unaudited condensed consolidated financial statements (consolidated financial statements) include the accounts of Ball Corporation and its controlled affiliates, including its consolidated variable interest entities (collectively Ball, the company, we or our), and have been prepared by the company. Certain information and footnote disclosures, including critical and significant accounting policies normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted for this quarterly presentation.

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Results of operations for the periods shown are not necessarily indicative of results for the year, particularly in view of the seasonality in the packaging segments and the variability of contract sales in the company’s aerospace segment. These consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and the notes thereto included in the company’s 2021 Annual Report on Form 10-K filed on February 16, 2022, pursuant to the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2021 (annual report).

​

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires Ball’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and reported amounts of sales and expenses during the reporting periods. These estimates are based on historical experience and various assumptions believed to be reasonable under the circumstances. Ball’s management evaluates these estimates on an ongoing basis and adjusts or revises the estimates as circumstances change. As future events and their impacts cannot be determined with precision, actual results may differ from these estimates. In the opinion of management, the consolidated financial statements reflect all adjustments that are of a normal recurring nature and are necessary to fairly state the results of the periods presented.

​

Certain prior year amounts have been reclassified in order to conform to the current year presentation.

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Risks and Uncertainties

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Russian Invasion of Ukraine

​

The current global business environment is being impacted directly and indirectly by the effects of the Russian invasion of Ukraine, and it is not possible to accurately predict all future impacts of the invasion. Ball has suspended future investments in Russia and is pursuing the sale of its aluminum beverage packaging business located in Russia. As of March 31, 2022, Ball’s Russian aluminum packaging business does not meet the requirements for held for sale presentation in Ball’s consolidated financial statements. Additionally, Russia’s invasion of Ukraine has the potential to increase Ball’s vulnerabilities to near-term, severe impacts related to its Russian business and facilities. The Russian government has made warnings to companies that cease operations during its invasion of Ukraine and the potential exists that Ball’s operations in Russia could be negatively impacted. As such, Russia’s invasion of Ukraine and the resulting effects have the potential to impact significant estimates used by Ball in the preparation of its consolidated financial statements, which could result in impairments.

​

Ball has determined that the Russian invasion of Ukraine constitutes a triggering event for its Russian long-lived asset group. Ball performed a step one recoverability analysis for the long-lived asset group of Ball’s Russian business, which indicated that the carrying value of the asset group was recoverable as of March 31, 2022, and as a result, no impairment was deemed necessary at this time.

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Ball’s Russian business, which is presented in its beverage packaging, EMEA, reportable operating segment, represented approximately 4 percent of the company's total net sales and 8 percent of the company's total comparable operating earnings for the twelve months ended December 31, 2021. In addition, our plants in Russia accounted for approximately 5 percent of the company's 112.5 billion global beverage can unit shipments for the twelve months ended December 31, 2021. As of March 31, 2022, Ball’s Russian business had net assets of $435 million, which consisted primarily of working capital, property, plant and equipment, and finite-lived intangible assets. As of March 31, 2022, Ball also had cumulative currency translation losses of $211 million recorded in equity that could be subject to release upon the liquidation of its Russian business. These values are subject to change based on the Russian ruble exchange rate.

Novel Coronavirus (COVID-19)

​

The current global business environment is being impacted directly and indirectly by the effects of the novel coronavirus (COVID-19), and it is not possible to accurately estimate the impacts of COVID-19. However, Ball management has reviewed the estimates used in preparing the company’s consolidated financial statements and the following have a reasonably possible likelihood of being affected, to a material extent, by the direct and indirect impacts of COVID-19 in the near term.

	●	Estimates regarding the future financial performance of the business used in the impairment tests for goodwill, long-lived assets, equity method investments, recoverability of deferred tax assets and estimates regarding cash needs and associated indefinite reinvestment assertions;

	●	Estimates of recoverability for customer receivables;

	●	Estimates of net realizable value for inventory; and

	●	Estimates regarding the likelihood of forecasted transactions associated with hedge accounting positions at March 31, 2022, which could impact the company’s ability to satisfy hedge accounting requirements and result in the recognition of income and/or expenses.

​

In addition to the above potential impacts on the estimates used in preparing consolidated financial statements, COVID-19 has the potential to increase Ball’s vulnerabilities to near-term severe impacts related to certain concentrations in its business. In line with other companies in the packaging and aerospace industries, Ball makes the majority of its sales and significant purchases to or from a relatively small number of global, or large regional, customers and suppliers. Furthermore, Ball makes the majority of its sales from a small number of product lines. The potential of COVID-19 to affect a significant customer or supplier, or to affect demand for certain products to a significant degree, heightens the vulnerability of Ball to these concentrations.

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2. Accounting Pronouncements

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New Accounting Guidance

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Government Assistance Disclosure

​

In 2021, new guidance was issued related to the disclosure of government assistance. The company is currently assessing the impact that the adoption of this new guidance will have on its consolidated financial statements.

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Reference Rate Reform

​

In 2020, new guidance was issued related to global reference rates reform. The company is currently evaluating the impact that the transition from its LIBOR-based interest rate agreements to Secured Overnight Financing Rate (SOFR) based interest rate agreements will have on its consolidated financial statements. Based on our current understanding, the LIBOR to SOFR transition is not expected to have a material impact on our financial condition, results of operations or cash flows.

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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 aluminum beverage containers throughout those countries.

​

Beverage packaging, EMEA_:_ Consists of operations in numerous countries throughout Europe, including Russia, as well as Egypt and Turkey, that manufacture and sell aluminum beverage containers throughout those countries.

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

​

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 table below, Other consists of a non-reportable operating segment (beverage packaging, other) that manufactures and sells aluminum beverage containers in India, Saudi Arabia and throughout the Asia Pacific region; a non-reportable operating segment that manufactures and sells extruded aluminum aerosol containers and recloseable aluminum bottles across multiple consumer categories as well as aluminum slugs (aerosol packaging) throughout North America, South America, Europe, and Asia; a non-reportable operating segment that manufactures and sells aluminum cups (aluminum cups); undistributed corporate expenses; and intercompany eliminations and other business activities.

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The accounting policies of the segments are the same as those used in the company’s consolidated financial statements as discussed in Note 1. The company also has investments in operations in Guatemala, Panama, 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. In 2021, Ball sold its minority-owned investment in South Korea. In January 2022, Ball sold its remaining equity method investment in Ball Metalpack. Refer to Note 4 for additional details on both transactions.

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Summary of Business by Segment

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​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Net sales	​	​	​	​	​	​
Beverage packaging, North and Central America	​	$	1,609	​	$	1,296
Beverage packaging, EMEA	​	​	942	​	​	796
Beverage packaging, South America	​	​	494	​	​	487
Aerospace	​	​	504	​	​	424
Reportable segment sales	​	​	3,549	​	​	3,003
Other	​	​	167	​	​	122
Net sales	​	$	3,716	​	$	3,125
​	​	​	​	​	​	​
Comparable operating earnings	​	​	​	​	​	​
Beverage packaging, North and Central America	​	$	174	​	$	140
Beverage packaging, EMEA	​	​	100	​	​	100
Beverage packaging, South America	​	​	78	​	​	93
Aerospace	​	​	43	​	​	35
Reportable segment comparable operating earnings	​	​	395	​	​	368
Reconciling items	​	​	​	​	​	​
Other (a)	​	​	(29)	​	​	(23)
Business consolidation and other activities	​	​	281	​	​	(7)
Amortization of acquired intangibles	​	​	(37)	​	​	(38)
Earnings before interest and taxes	​	​	610	​	​	300
Interest expense	​	​	(69)	​	​	(67)
Earnings before taxes	​	$	541	​	$	233

(a)	_Includes undistributed corporate expenses, net, of $_33 _million and $_26 million for the three months ended March 31, 2022 and 2021, respectively.

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

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4. Acquisitions and Dispositions

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Ball Metalpack Investment

​

During the first quarter of 2022, Ball sold its remaining 49 percent owned equity method investment in Ball Metalpack to Sonoco, a global provider of consumer, industrial, healthcare and protective packaging, for total consideration of approximately $305 million, net of customary closing adjustments, of which $298 million in cash was received in the first quarter of 2022. The remaining $7 million is subject to customary closing adjustments and is presented in receivables, net. Ball’s carrying value of the investment before the sale was zero; therefore, a gain from the sale, net of customary closing adjustments, of $305 million is reported in business consolidation and other activities in the unaudited condensed consolidated statements of earnings. Cash proceeds of $298 million related to the sale are presented in business dispositions, net of cash sold, in the unaudited condensed consolidated statement of cash flows.

​

Ball also received proceeds from Ball Metalpack for the repayment of an outstanding promissory note and accrued interest of approximately $16 million, which was recorded as a gain in business consolidation and other activities in the unaudited condensed consolidated statements of earnings.

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South Korea Investment

​

In the third quarter of 2021, Ball sold its minority-owned investment in South Korea. Consideration for the transaction was cash of $120 million, of which $110 million has been received, and is presented in business dispositions in cash flows from investing activities in Ball’s unaudited condensed consolidated statements of cash flows. The remaining $10 million will be received on or before December 31, 2022, and is presented in receivables, net on Ball’s unaudited condensed consolidated balance sheets. In the second quarter of 2021, the company recorded a loss of $5 million related to the disposal, which was presented in business consolidation and other activities in the unaudited condensed consolidated statement of earnings.

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5. Revenue from Contracts with Customers

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The following table disaggregates the company’s net sales based on the timing of transfer of control:

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​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended March 31,								​
Years Ended March 31,	​	Point in Time		​	Over Time		​	Total
​	​	​	​	​	​	​	​	​	​	​
2022	​	$	601	​	$	3,115	​	$	3,716	​
2021	​	​	610	​	​	2,515	​	​	3,125	​

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Contract Balances

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The company did not have any contract assets at either March 31, 2022, or December 31, 2021. Unbilled receivables, which are not classified as contract assets, represent arrangements in which sales have been recorded prior to billing and right to payment is unconditional.

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The opening and closing balances of the company’s current and noncurrent contract liabilities are as follows:

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​	​	​	​	​	​	​
​	​	Contract		​	Contract
​	​	Liabilities		​	Liabilities
($ in millions)		(Current)		​	(Noncurrent)
​	​	​	​	​	​	​
Balance at December 31, 2021	​	$	272	​	$	38
Increase (decrease)	​	​	(38)	​	​	(21)
Balance at March 31, 2022	​	$	234	​	$	17
​	​	​	​	​	​	​

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During the three months ended March 31, 2022, total contract liabilities decreased by $59 million, which is net of cash received of $131 million and amounts recognized as sales of $190 million, the majority of which related to current contract liabilities. The amount of sales recognized in the three months ended March 31, 2022, which were included in the opening contract liabilities balances, was $190 million, all of which related to current contract liabilities. Current contract liabilities are classified within other current liabilities on the unaudited condensed consolidated balance sheet and noncurrent contract liabilities are classified within other liabilities.

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The company also recognized net sales of $9 million and $7 million in the three months ended March 31, 2022 and 2021, respectively, from performance obligations satisfied (or partially satisfied) in prior periods. These sales amounts are the result of changes in the transaction price of the company’s contracts with customers.

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Transaction Price Allocated to Remaining Performance Obligations

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The table below discloses: (1) the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied (or partially unsatisfied) as of the end of the reporting period for contracts with an original duration of greater than one year, and (2) when the company expects to record sales on these multi-year contracts.

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​	​	​	​	​	​	​	​	​	​
($ in millions)		Next Twelve Months		​	Thereafter		​	Total
​	​	​	​	​	​	​	​	​	​
Sales expected to be recognized on multi-year contracts in place as of March 31, 2022	​	$	1,491	​	$	1,669	​	$	3,160

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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 March 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Beverage packaging, North and Central America	​	$	1	​	$	1
Beverage packaging, EMEA	​	​	(1)	​	​	(2)
Beverage packaging, South America	​	​	(1)	​	​	(1)
Other	​	​	282	​	​	(5)
​	​	$	281	​	$	(7)

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2022

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Beverage Packaging, North and Central America

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During the three months ended March 31, 2022, the company recorded charges of $1 million for individually insignificant activities.

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Beverage Packaging, EMEA

​

During the three months ended March 31, 2022, the company recorded charges of $1 million for individually insignificant activities.

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Beverage Packaging, South America

​

During the three months ended March 31, 2022, the company recorded charges of $1 million for individually insignificant activities.

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Other

​

During the three months ended March 31, 2022, the company recorded the following amounts:

	●	A gain of $305 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.

	●	Currency losses of $9 million associated with market conditions preventing the company from effectively entering into currency derivative positions to minimize currency exposures associated with the Russian ruble.

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2021

​

Beverage Packaging, North and Central America

​

During the three months ended March 31, 2021, the company recorded income of $1 million for individually insignificant activities.

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Beverage Packaging, EMEA

​

During the three months ended March 31, 2021, the company recorded charges of $2 million for individually insignificant activities in connection with previously announced plant closures, restructuring and other activities.

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Beverage Packaging, South America

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During the three months ended March 31, 2021, the company recorded charges of $1 million for individually insignificant activities.

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Other

​

During the three months ended March 31, 2021, the company recorded charges of $5 million for individually insignificant activities.

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7.	Supplemental Cash Flow Statement Disclosures

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​	​	​	​	​	​	​
​	​	March 31,
($ in millions)	​	2022			2021
​	​	​	​		​	​
Beginning of period:	​	​	​		​	​
Cash and cash equivalents	​	$	563		$	1,366
Current restricted cash (included in other current assets)	​	​	16		​	15
Total cash, cash equivalents and restricted cash	​	$	579		$	1,381
​	​	​	​		​	​
End of period:	​	​	​		​	​
Cash and cash equivalents	​	$	437		$	461
Current restricted cash (included in other current assets)	​	​	9		​	10
Total cash, cash equivalents and restricted cash	​	$	446		$	471

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The company’s restricted cash is primarily related to receivables factoring programs and represents amounts collected from customers that have not yet been remitted to the banks as of the end of the reporting period.

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Noncash investing activities include the acquisition of property, plant and equipment (PP&E) for which payment has not been made. These noncash capital expenditures are excluded from the statement of cash flows. A summary of the PP&E acquired but not yet paid for is as follows:

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​	​	​	​	​	​	​
​	​	March 31,
($ in millions)	​	2022			2021
​	​	​	​		​	​
Beginning of period:	​	​	​		​	​
PP&E acquired but not yet paid	​	$	540		$	409
​	​	​	​	​	​	​
End of period:	​	​	​		​	​
PP&E acquired but not yet paid	​	$	528		$	515

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8. Receivables, Net

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​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)	​	2022			2021
​	​	​	​	​	​	​
Trade accounts receivable	​	$	1,664	​	$	1,304
Unbilled receivables	​	​	839	​	​	727
Less: Allowance for doubtful accounts	​	​	(8)	​	​	(9)
Net trade accounts receivable	​	​	2,495	​	​	2,022
Other receivables	​	​	633	​	​	538
​	​	$	3,128	​	$	2,560

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The company has entered into several regional committed and uncommitted accounts receivable factoring programs with various financial institutions for certain of its receivables. The programs are accounted for as true sales of the receivables, without recourse to Ball, and had combined limits of approximately $2 billion and $1.7 billion at March 31, 2022, and December 31, 2021, respectively. A total of $892 million and $308 million were available for sale under these programs as of March 31, 2022, and December 31, 2021, respectively.

​

Other receivables include income and sales tax receivables, aluminum scrap sale receivables and other miscellaneous receivables, including remaining amounts related to sales of the company’s equity method investments as detailed in Note 4.

​

9. Inventories, Net

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)	​	2022			2021
​	​	​	​	​	​	​
Raw materials and supplies	​	$	1,200	​	$	1,064
Work-in-process and finished goods	​	​	1,214	​	​	821
Less: Inventory reserves	​	​	(91)	​	​	(90)
​	​	$	2,323	​	$	1,795

​

​

10. Property, Plant and Equipment, Net

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Land	​	$	184	​	$	167
Buildings	​	​	2,134	​	​	2,081
Machinery and equipment	​	​	7,016	​	​	6,876
Construction-in-progress	​	​	1,245	​	​	1,179
​	​	​	10,579	​	​	10,303
Accumulated depreciation	​	​	(3,896)	​	​	(3,801)
​	​	$	6,683	​	$	6,502

​

Depreciation expense amounted to $140 million and $123 million for the three months ended March 31, 2022 and 2021, respectively.

​

11. Goodwill

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
($ in millions)		Beverage****Packaging,North & CentralAmerica			**​ BeveragePackaging,**EMEA			**​ BeveragePackaging,**South America			**​ **Aerospace			Other			Total
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Balance at December 31, 2021	​	$	1,275	​	$	1,483	​	$	1,298	​	$	40	​	$	282	​	$	4,378
Effects of currency exchange	​	​	—	​	​	(60)	​	​	—	​	​	—	​	​	6	​	​	(54)
Balance at March 31, 2022	​	$	1,275	​	$	1,423	​	$	1,298	​	$	40	​	$	288	​	$	4,324

​

Goodwill in the above table is presented net of accumulated impairment losses of $61 million and $62 million as of March 31, 2022 and December 31, 2021, respectively.

​

​

12. Intangible Assets, Net

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Acquired customer relationships and other intangibles (net of accumulated amortization of $883 million at March 31, 2022, and $862 million at December 31, 2021)	​	$	1,529	​	$	1,593
Capitalized software (net of accumulated amortization of $193 million at March 31, 2022, and $187 million at December 31, 2021)	​	​	76	​	​	74
Other intangibles (net of accumulated amortization of $98 million at March 31, 2022, and $97 million at December 31, 2021)	​	​	22	​	​	21
​	​	$	1,627	​	$	1,688

​

Total amortization expense of intangible assets amounted to $45 million for the three months ended March 31, 2022 and 2021.

​

13. Other Assets

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Long-term pension assets	​	$	565	​	$	579
Right-of-use operating lease assets	​	​	443	​	​	420
Investments in affiliates	​	​	190	​	​	184
Long-term deferred tax assets	​	​	88	​	​	126
Other	​	​	700	​	​	614
​	​	$	1,986	​	$	1,923

​

​

​

​

Investments in affiliates primarily includes the company’s 50 percent ownership interest in an entity in Guatemala, a 50 percent ownership interest in an entity in Panama, a 50 percent ownership interest in an entity in Vietnam and an ownership interest of 50 percent in an entity in the U.S.

​

In 2021, Ball sold its minority-owned investment in South Korea. In the first quarter of 2022, Ball sold its remaining equity method investment in Ball Metalpack for total consideration of $305 million. See Note 4 for further details of both transactions.

​

​

​

​

​

​

14. Leases

​

The company enters into operating leases for buildings, warehouses, office equipment, production equipment, aircraft, land and other types of equipment. The company also enters into finance leases for certain plant equipment.

Supplemental balance sheet information related to the company’s leases follows:

​

​	​	​	​	​	​	​	​
​	​	​	March 31,		​	December 31,
($ in millions)	Balance Sheet Location	​	2022		​	2021
​	​	​	​	​	​	​	​
Operating leases:	​	​	​	​	​	​	​
Operating lease ROU asset	Other assets	​	$	443	​	$	420
Current operating lease liabilities	Other current liabilities	​	​	86	​	​	80
Noncurrent operating lease liabilities	Other liabilities	​	​	360	​	​	340
Finance leases:	​	​	​	​	​	​	​
Finance lease ROU assets, net	Property, plant and equipment, net	​	​	13	​	​	14
Current finance lease liabilities	Short-term debt and current portion of long-term debt	​	​	2	​	​	2
Noncurrent finance lease liabilities	Long-term debt	​	​	12	​	​	12

​

​

​

​

15. Debt

​

Long-term debt consisted of the following:

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Senior Notes	​	​	​	​	​	​
4.00% due November 2023	​	$	1,000	​	$	1,000
4.375%, euro denominated, due December 2023	​	​	775	​	​	796
0.875%, euro denominated, due March 2024	​	​	830	​	​	853
5.25% due July 2025	​	​	1,000	​	​	1,000
4.875% due March 2026	​	​	750	​	​	750
1.50%, euro denominated, due March 2027	​	​	609	​	​	625
2.875% due August 2030	​	​	1,300	​	​	1,300
3.125% due September 2031	​	​	850	​	​	850
Senior Credit Facility (at variable rates)	​	​	​	​	​	​
Term A loan due March 2024	​	​	593	​	​	593
U.S. dollar revolver due March 2024	​	​	600	​	​	—
Finance lease obligations	​	​	14	​	​	14
Other (including debt issuance costs)	​	​	(52)	​	​	(56)
​	​	​	8,269	​	​	7,725
Less: Current portion	​	​	(4)	​	​	(3)
​	​	$	8,265	​	$	7,722

​

The company’s senior credit facilities include long-term multi-currency revolving facilities that mature in March 2024, which provide the company with up to the U.S. dollar equivalent of $1.75 billion. At March 31, 2022, taking into account outstanding letters of credit, $1.1 billion was available under the company’s long-term, revolving credit facilities. In addition to these facilities, the company had approximately $890 million of short-term uncommitted credit facilities available at March 31, 2022, of which $289 million was outstanding and due on demand. At December 31, 2021, the company had $12 million outstanding under short-term uncommitted credit facilities.

​

The fair value of long-term debt was estimated to be $8.2 and $8 billion at March 31, 2022 and December 31, 2021, respectively. The fair value reflects the market rates at each period end for debt with credit ratings similar to the company’s ratings and is classified as Level 2 within the fair value hierarchy. Rates currently available to the company for loans with similar terms and maturities are used to estimate the fair value of long-term debt based on discounted cash flows.

​

The U.S. note agreements and bank credit agreement contain certain restrictions relating to dividend payments, share repurchases, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The company’s most restrictive debt covenant requires the company to maintain a leverage ratio (as defined) of no greater than 5.0 times as of March 31, 2022, which will change to 4.5 times as of December 31, 2022. The company was in compliance with all loan agreements and debt covenants at both March 31, 2022, and December 31, 2021, and it has met all debt payment obligations.

​

16. Taxes on Income

​

The company’s effective tax rate was 18.5 percent and 13.7 percent for the three months ended March 31, 2022 and 2021, respectively. As compared to the statutory U.S. tax rate, the effective tax rate for the three months ended March 31, 2022, was reduced by 2.3 percentage points for share-based compensation, reduced by 1.5 percentage points for changes in deferred taxes on the investment in its Russian business, and increased by 1.3 percentage points for the sale of the Ball Metalpack equity method investment. As compared to the statutory U.S. tax rate, the effective tax rate for the three months ended March 31, 2021, was reduced by 5 percentage points for non-U.S. rate differences net of withholding tax, 2.6 percentage points for share-based compensation, and 2.4 percentage points for federal tax credits.

​

17. Employee Benefit Obligations

​

​	​	​	​	​	​	​
​	​	March 31,		​	December 31,
($ in millions)	​	2022			2021
​	​	​	​	​	​	​
Underfunded defined benefit pension liabilities	​	$	503	​	$	582
Less: Current portion	​	​	(21)	​	​	(21)
Long-term defined benefit pension liabilities	​	​	482	​	​	561
Long-term retiree medical liabilities	​	​	133	​	​	135
Deferred compensation plans	​	​	398	​	​	441
Other	​	​	34	​	​	68
​	​	$	1,047	​	$	1,205

​

Components of net periodic benefit cost associated with the company’s defined benefit pension plans were as follows:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
​	​	2022								​	2021
($ in millions)		U.S.			Non-U.S.			Total			U.S.			Non-U.S.			Total
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Ball-sponsored plans:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Service cost	​	$	22	​	$	3	​	$	25	​	$	21	​	$	3	​	$	24
Interest cost	​	​	13	​	​	13	​	​	26	​	​	13	​	​	9	​	​	22
Expected return on plan assets	​	​	(27)	​	​	(17)	​	​	(44)	​	​	(31)	​	​	(16)	​	​	(47)
Amortization of prior service cost	​	​	—	​	​	1	​	​	1	​	​	—	​	​	1	​	​	1
Recognized net actuarial loss	​	​	7	​	​	1	​	​	8	​	​	13	​	​	1	​	​	14
Total net periodic benefit cost	​	$	15	​	$	1	​	$	16	​	$	16	​	$	(2)	​	$	14

​

Non-service pension income of $9 million and $10 million for the three months ended March 31, 2022 and 2021, respectively, is included in selling, general, and administrative (SG&A) expenses in the unaudited condensed consolidated statement of earnings.

​

Contributions to the company’s defined benefit pension plans were $104 million for the first three months of 2022 compared to $162 million for the first three months of 2021, and such contributions are expected to be approximately $127 million for the full year of 2022. This estimate may change based on changes to the U.S. Pension Protection Act and the actual returns achieved on plan assets, among other factors.

​

18. Equity and Accumulated Other Comprehensive Earnings

​

The following tables provide additional details of the company’s equity activity:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Common Stock				​	Treasury Stock				​	​	​	​	Accumulated Other		​	​	​	​	​	​
​	​	Number of	​	​		​	Number of	​	​		​	Retained		​	Comprehensive		​	Noncontrolling		​	Total
($ in millions; share amounts in thousands)		Shares		Amount			Shares		Amount			Earnings			Earnings (Loss)			Interest			Equity
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Balance at December 31, 2021	​	680,945	​	$	1,220	​	(360,101)	​	$	(3,854)	​	$	6,843	​	$	(582)	​	$	58	​	$	3,685
Net earnings	​	—	​	​	—	​	—	​	​	—	​	​	446	​	​	—	​	​	1	​	​	447
Other comprehensive earnings (loss), net of tax	​	—	​	​	—	​	—	​	​	—	​	​	—	​	​	(29)	​	​	—	​	​	(29)
Common dividends, net of tax benefits	​	—	​	​	—	​	—	​	​	—	​	​	(65)	​	​	—	​	​	—	​	​	(65)
Treasury stock purchases	​	—	​	​	—	​	(1,147)	​	​	(102)	​	​	—	​	​	—	​	​	—	​	​	(102)
Treasury shares reissued	​	—	​	​	—	​	151	​	​	9	​	​	—	​	​	—	​	​	—	​	​	9
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	​	791	​	​	6	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	6
Other activity	​	—	​	​	—	​	—	​	​	6	​	​	—	​	​	—	​	​	—	​	​	6
Balance at March 31, 2022	​	681,736	​	$	1,226	​	(361,097)	​	$	(3,941)	​	$	7,224	​	$	(611)	​	$	59	​	$	3,957

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Common Stock				​	Treasury Stock				​	​	​	​	Accumulated Other		​	​	​	​	​	​
​	​	Number of	​	​		​	Number of	​	​		​	Retained		​	Comprehensive		​	Noncontrolling		​	Total
($ in millions; share amounts in thousands)		Shares		Amount			Shares		Amount			Earnings			Earnings (Loss)			Interest			Equity
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Balance at December 31, 2020	​	679,524	​	$	1,167	​	(351,939)	​	$	(3,130)	​	$	6,192	​	$	(954)	​	$	62	​	$	3,337
Net earnings	​	—	​	​	—	​	—	​	​	—	​	​	200	​	​	—	​	​	—	​	​	200
Other comprehensive earnings (loss), net of tax	​	—	​	​	—	​	—	​	​	—	​	​	—	​	​	57	​	​	—	​	​	57
Common dividends, net of tax benefits	​	—	​	​	—	​	—	​	​	—	​	​	(50)	​	​	—	​	​	—	​	​	(50)
Treasury stock purchases	​	—	​	​	—	​	(121)	​	​	(10)	​	​	—	​	​	—	​	​	—	​	​	(10)
Treasury shares reissued	​	—	​	​	—	​	161	​	​	8	​	​	—	​	​	—	​	​	—	​	​	8
Shares issued and stock compensation for stock options and other stock plans, net of shares exchanged	​	490	​	​	4	​	—	​	​	8	​	​	—	​	​	—	​	​	—	​	​	12
Balance at March 31, 2021	​	680,014	​	$	1,171	​	(351,899)	​	$	(3,124)	​	$	6,342	​	$	(897)	​	$	62	​	$	3,554

​

Accumulated Other Comprehensive Earnings (Loss)

​

The activity related to accumulated other comprehensive earnings (loss) was as follows:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
($ in millions)		​ CurrencyTranslation**(Net of Tax)**			Pension and Other Postretirement Benefits (Net of Tax)			Derivatives Designated as Hedges**(Net of Tax)**			Accumulated Other Comprehensive Earnings (Loss)
​	​	​	​	​	​	​	​	​	​	​	​	​
Balance at December 31, 2021	​	​	(536)	​	​	(169)	​	​	123	​	​	(582)
Other comprehensive earnings (loss) before reclassifications	​	​	(92)	​	​	(1)	​	​	82	​	​	(11)
Reclassification of net deferred (gains) losses into earnings	​	​	—	​	​	7	​	​	(25)	​	​	(18)
Balance at March 31, 2022	​	$	(628)	​	$	(163)	​	$	180	​	$	(611)

​

The following table provides additional details of the amounts recognized into net earnings from accumulated other comprehensive earnings (loss):

​

​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions)		2022			2021
​	​	​	​	​	​	​
Gains (losses) on cash flow hedges:	​	​	​	​	​	​
Commodity contracts recorded in net sales	​	$	(31)	​	$	(16)
Commodity contracts recorded in cost of sales	​	​	35	​	​	10
Currency exchange contracts recorded in selling, general and administrative	​	​	28	​	​	42
Interest rate contracts recorded in interest expense	​	​	1	​	​	—
Total before tax effect	​	​	33	​	​	36
Tax benefit (expense) on amounts reclassified into earnings	​	​	(8)	​	​	(7)
Recognized gain (loss), net of tax	​	$	25	​	$	29
​	​	​	​	​	​	​
Amortization of pension and other postretirement benefits: (a)	​	​	​	​	​	​
Actuarial gains (losses)	​	$	(8)	​	$	(14)
Prior service income (expense)	​	​	(1)	​	​	(1)
Total before tax effect	​	​	(9)	​	​	(15)
Tax benefit (expense) on amounts reclassified into earnings	​	​	2	​	​	4
Recognized gain (loss), net of tax	​	$	(7)	​	$	(11)

(a)	These components are included in the computation of net periodic benefit cost detailed in Note 17.

​

​

19. Earnings and Dividends Per Share

​

​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions, except per share amounts; shares in thousands)		2022			2021
​	​	​	​	​	​	​
Net earnings attributable to Ball Corporation	​	$	446	​	$	200
​	​	​	​	​	​	​
Basic weighted average common shares	​	​	320,904	​	​	327,811
Effect of dilutive securities	​	​	5,012	​	​	5,862
Weighted average shares applicable to diluted earnings per share	​	​	325,916	​	​	333,673
​	​	​	​	​	​	​
Per basic share	​	$	1.39	​	$	0.61
Per diluted share	​	$	1.37	​	$	0.60

​

Certain outstanding options are excluded from the diluted earnings per share calculation because they are anti-dilutive (i.e., their assumed conversion into common stock would increase rather than decrease earnings per share). Ball excluded two million and one million anti-dilutive options for the three months ended March 31, 2022 and 2021, respectively.

​

The company declared and paid dividends of $0.20 per share and $0.15 per share for the three months ended March 31, 2022 and 2021, respectively.

​

​

20. Financial Instruments and Risk Management

​

Policies and Procedures

​

The company employs established risk management policies and procedures, which seek to reduce the company’s commercial risk exposure to fluctuations in commodity prices, interest rates, currency exchange rates and prices of the company’s common stock with regard to common share repurchases and the company’s deferred compensation stock plan. However, there can be no assurance these policies and procedures will be successful. Although the instruments utilized involve varying degrees of credit, market and interest risk, the counterparties to the agreements are expected to perform fully under the terms of the agreements. The company monitors counterparty credit risk, including lenders, on a regular basis, but Ball cannot be certain that all risks will be discerned or that its risk management policies and procedures will always be effective. Additionally, in the event of default under the company’s master derivative agreements, the non-defaulting party has the option to offset any amounts owed with regard to open derivative positions.

​

Commodity Price Risk - The company manages commodity price risk in connection with market price fluctuations of aluminum through two different methods. First, the company enters into container sales contracts that include aluminum-based pricing terms which generally reflect the same price fluctuations under commercial purchase contracts for aluminum sheet. The terms include fixed, floating or pass through aluminum component pricing. Second, the company uses certain derivative instruments, including option and forward contracts, as economic and cash flow hedges of commodity price risk where there are material differences between sales and purchase contracted pricing and volume.

​

Interest Rate Risk - The company’s objective in managing exposure to interest rate changes is to minimize the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve these objectives, the company may use a variety of interest rate swaps, collars and options to manage its mix of floating and fixed-rate debt.

​

Currency Exchange Rate Risk - The company’s objective in managing exposure to currency fluctuations is to limit the exposure of cash flows and earnings from changes associated with currency exchange rate changes through the use of various derivative contracts. In addition, at times the company manages earnings translation volatility through the use of currency option strategies, and the change in the fair value of those options is recorded in the company’s net earnings.

​

The following table provides additional information related to the commercial risk management instruments described above:

​

​	​	​	​	​	​	​	​	​	​
($ in millions)	​	March 31, 2022
Commercial risk area	​	Commodity			Currency			Interest Rate
​	​	​	​	​	​	​	​	​	​
Notional amount of contracts	​	$	1,999	​	$	2,910	​	$	1,164
Net gain (loss) included in AOCI, after-tax	​	​	180	​	​	(1)	​	​	1
Net gain (loss) included in AOCI, after-tax, expected to be recognized in net earnings within the next 12 months	​	​	174	​	​	13	​	​	1
​	​	​	​	​	​	​	​	​	​
Longest duration of forecasted cash flow hedge transactions in years	​	​	2	​	​	3	​	​	1

​

Common Stock Price Risk

​

The company’s deferred compensation stock program is subject to variable plan accounting and, accordingly, is marked to fair value using the company’s closing stock price at the end of the related reporting period. The company entered into total return swaps to reduce the company’s earnings exposure to these fair value fluctuations that will be outstanding through May 2023 and have a combined notional value of 2.5 million shares. Based on the current number of shares in the program, each $1 change in the company’s stock price would have an insignificant impact on pretax earnings, net of the impact of related derivatives.

​

Collateral Calls

​

The company’s agreements with its financial counterparties require the company to post collateral in certain circumstances when the negative mark to fair value of the derivative contracts exceeds specified levels. Additionally, the company has collateral posting arrangements with certain customers on these derivative contracts. The cash flows of the margin calls, if any, are shown within the investing section of the company’s unaudited condensed consolidated statements of cash flows. As of March 31, 2022, and December 31, 2021, the aggregate fair value of all derivative instruments with credit-risk-related contingent features was a net liability position of $41 million and $3 million, respectively, and no collateral was required to be posted.

​

Fair Value Measurements

​

Ball has classified all applicable financial derivative assets and liabilities as Level 2 within the fair value hierarchy as of March 31, 2022, and December 31, 2021, and presented those values in the tables below. The company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels.

​

​	​	​	​	​	​	​	​	​	​	​
​	​	​	March 31, 2022
($ in millions)	Balance Sheet Location		DerivativesDesignatedas Hedging****Instruments			Derivatives notDesignated asHedging****Instruments			Total
​	​	​	​	​	​	​	​	​	​	​
Assets:	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	262	​	$	—	​	$	262
Currency contracts	​	​	​	3	​	​	18	​	​	21
Other contracts	​	​	​	1	​	​	4	​	​	5
Total current derivative contracts	Other current assets	​	$	266	​	$	22	​	$	288
​	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	8	​	$	—	​	$	8
Currency contracts	​	​	​	68	​	​	1	​	​	69
Total noncurrent derivative contracts	Other noncurrent assets	​	$	76	​	$	1	​	$	77
	​	​	​	​	​	​	​	​	​	​
Liabilities:	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	82	​	$	—	​	$	82
Currency contracts	​	​	​	8	​	​	22	​	​	30
Other contracts	​	​	​	—	​	​	4	​	​	4
Total current derivative contracts	Other current liabilities	​	$	90	​	$	26	​	$	116
​	​	​	​	​	​	​	​	​	​	​
Currency contracts	​	​	$	—	​	$	2	​	$	2
Total noncurrent derivative contracts	Other noncurrent liabilities	​	$	—	​	$	2	​	$	2

​

​	​	​	​	​	​	​	​	​	​	​
​	​	​	December 31, 2021
($ in millions)	Balance Sheet Location	​	DerivativesDesignatedas Hedging****Instruments			Derivatives notDesignated asHedging****Instruments			Total
​	​	​	​	​	​	​	​	​	​	​
Assets:	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	142	​	$	—	​	$	142
Currency contracts	​	​	​	2	​	​	19	​	​	21
Other contracts	​	​	​	1	​	​	6	​	​	7
Total current derivative contracts	Other current assets	​	$	145	​	$	25	​	$	170
​	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	3	​	$	—	​	$	3
Currency contracts	​	​	​	59	​	​	1	​	​	60
Total noncurrent derivative contracts	Other noncurrent assets	​	$	62	​	$	1	​	$	63
	​	​	​	​	​	​	​	​	​	​
Liabilities:	​	​	​	​	​	​	​	​	​	​
Commodity contracts	​	​	$	20	​	$	—	​	$	20
Currency contracts	​	​	​	—	​	​	8	​	​	8
Other contracts	​	​	​	—	​	​	1	​	​	1
Total current derivative contracts	Other current liabilities	​	$	20	​	$	9	​	$	29
​	​	​	​	​	​	​	​	​	​	​
Currency contracts	​	​	$	—	​	$	3	​	$	3
Total noncurrent derivative contracts	Other noncurrent liabilities	​	$	—	​	$	3	​	$	3

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The company uses closing spot and forward market prices as published by the London Metal Exchange, the Chicago Mercantile Exchange, Reuters and Bloomberg to determine the fair value of any outstanding aluminum, currency, energy, inflation and interest rate spot and forward contracts. Option contracts are valued using a Black-Scholes model with observable market inputs for aluminum, currency and interest rates. The company values each of its financial instruments either internally using a single valuation technique, from a reliable observable market source, or from the use of third-party software. The company does not adjust the value of its financial instruments except in determining the fair value of a trade that settles in the future. The present value discounting factor is based on the comparable time period LIBOR rate or 12-month LIBOR. Ball performs validations of the company’s internally derived fair values reported for the company’s financial instruments on a quarterly basis utilizing counterparty valuation statements. The company additionally evaluates counterparty creditworthiness and, as of March 31, 2022, has not identified any circumstances requiring the reported values of the company’s financial instruments be adjusted.

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The following table provides the effects of derivative instruments in the consolidated statement of earnings and on accumulated other comprehensive earnings (loss):

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​	​	​	​	Three Months Ended March 31,
​	​	​	​	2022					​	2021
($ in millions)		Location of Gain (Loss)Recognized in Earningson Derivatives		Cash FlowHedge -ReclassifiedAmount fromAccumulatedOtherComprehensive****Earnings (Loss)			Gain (Loss) onDerivatives notDesignated asHedgeInstruments			Cash FlowHedge -ReclassifiedAmount fromAccumulatedOtherComprehensive****Earnings (Loss)			Gain (Loss) onDerivatives notDesignated asHedgeInstruments
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Commodity contracts - manage exposure to customer pricing	​	Net sales	​	$	(31)	​	$	—	​	$	(16)	​	$	—
Commodity contracts - manage exposure to supplier pricing	​	Cost of sales	​	​	35	​	​	(14)	​	​	10	​	​	3
Interest rate contracts - manage exposure for outstanding debt	​	Interest expense	​	​	1	​	​	—	​	​	—	​	​	—
Currency contracts - manage currency exposure	​	Selling, general and administrative	​	​	28	​	​	(5)	​	​	42	​	​	35
Equity contracts	​	Selling, general and administrative	​	​	—	​	​	(16)	​	​	—	​	​	(25)
Total	​	​	​	$	33	​	$	(35)	​	$	36	​	$	13

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The changes in accumulated other comprehensive earnings (loss) for derivatives designated as hedges were as follows:

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​	​	​	​	​	​	​
​	​	Three Months Ended March 31,
($ in millions)		2022			2021
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Amounts reclassified into earnings:	​	​	​	​	​	​
Commodity contracts	​	$	(4)	​	$	6
Interest rate contracts	​	​	(1)	​	​	—
Currency exchange contracts	​	​	(28)	​	​	(42)
Change in fair value of cash flow hedges:	​	​	​	​	​	​
Commodity contracts	​	​	94	​	​	51
Interest rate contracts	​	​	2	​	​	—
Currency exchange contracts	​	​	4	​	​	31
Currency and tax impacts	​	​	(10)	​	​	(9)
​	​	$	57	​	$	37

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21. Contingencies

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Ball is subject to numerous lawsuits, claims or proceedings arising out of the ordinary course of business, including actions related to product liability; personal injury; the use and performance of company products; warranty matters; patent, trademark or other intellectual property infringement; contractual liability; the conduct of the company’s business; tax reporting in domestic and non-U.S. jurisdictions; workplace safety and environmental and other matters. The company has also been identified as a potentially responsible party (PRP) at several waste disposal sites under U.S. federal and related state environmental statutes and regulations and may have joint and several liability for any investigation and remediation costs incurred with respect to such sites. In addition, the company has received claims alleging that employees in certain plants have suffered damages due to exposure to alleged workplace hazards. Some of these lawsuits, claims and proceedings involve substantial amounts, including as described below, and some of the environmental proceedings involve potential monetary costs or sanctions that may be material. Ball has denied liability with respect to many of these lawsuits, claims and proceedings and is vigorously defending such lawsuits, claims and proceedings. The company carries various forms of commercial, property and casualty, and other forms of insurance; however, such insurance may not be applicable or adequate to cover the costs associated with a judgment against Ball with respect to these lawsuits, claims and proceedings. The company estimates that potential liabilities for all currently known and estimable environmental matters are approximately $26 million in the aggregate, and such amounts have been included in other current liabilities and other noncurrent liabilities at March 31, 2022.

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In February 2012, Ball Metal Beverage Container Corp. (BMBCC) filed an action against Crown Packaging Technology, Inc. (Crown) in the U.S. District Court for the Southern District of Ohio (the Court) seeking a declaratory judgment that the manufacture, sale and use of certain ends by BMBCC and its customers do not infringe certain claims of Crown’s U.S. patents. Crown subsequently filed a counterclaim alleging infringement of certain claims in these patents seeking unspecified monetary damages, fees and declaratory and injunctive relief. The District Court issued a claim construction order at the end of December 2015 and held a scheduling conference on February 10, 2016, to determine the timeline for future steps in the litigation. The case was stayed by mutual agreement of the parties into the third quarter of 2016, during which Crown made preparations for its discovery with respect to certain ends previously produced by Rexam’s U.S. subsidiary, Rexam Beverage Can Company (RBCC). Such discovery began during the first half of 2017 and concluded in the fourth quarter of 2018. The parties attempted to mediate the case on August 1, 2017, but no progress was made, and the case continued as scheduled. In December 2018, BMBCC and RBCC filed a motion for summary judgment that the Crown patents at issue are invalid and that the applicable ends supplied by BMBCC and RBCC did not infringe the patents. Crown did not file a motion for summary judgment. On June 21, 2019, the District Court issued an order sustaining the BMBCC/RBCC motion as to invalidity, declining to rule on the other grounds as moot, and indicating that an expanded opinion and an appealable order would be forthcoming. The expanded opinion was docketed on July 22, 2019. The final, appealable order was issued by the Court on September 25, 2019, and the expanded opinion was unsealed. On October 22, 2019, Crown filed a Notice of Appeal of the decision of the Court to the Court of Appeals for the Federal Circuit. On December 31, 2020, the Court of Appeals vacated the decision of the District Court and remanded the case for further proceedings. The District Court held a telephonic hearing with counsel for the parties in March 2021 to discuss the scope of the proceedings on remand and initial position statements regarding remand which was submitted by each party. The District Court also directed each party to submit a document in response to the initial position statements of the other party in April 2021. The parties submitted their position statements to the District Court on April 21, 2021. On August 25, 2021, the Court issued its order regarding the further proceedings permitting each party to submit supplemental expert reports and depositions of the experts. On September 9, 2021, the parties submitted a Submission Regarding Scheduling in which most issues were agreed, but the Court was requested to resolve a dispute regarding the process and timing for the submission of each expert’s report and the deposition of the experts. The Court has not yet responded to this filing and has not issued a schedule for proceedings on remand. Based on the information available at the present time, the company does not believe that this matter will have a material adverse effect upon its liquidity, results of operations or financial condition.

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A former Rexam Personal Care site in Annecy, France, was found in 2003 to be contaminated following a leak of chlorinated solvents (TCE) from an underground feedline. The site underwent extensive investigation and an active remediation treatment system was put in place in 2006. The business operating from the site was sold to Albea in 2013 and in turn to a French company CATIDOM (operating as Reboul). Reboul vacated the site in September 2014, and the site reverted back to Rexam during the first quarter of 2015. As part of the site closure regulatory requirements, a new regulatory permit (Prefectoral Order) was issued in June 2016, which includes requirements to undertake a cost-benefit analysis and pilot studies of further treatment for the known residual solvent contamination following the shutdown of the current on-site treatment system. A new management plan was proposed to the French Environmental Authorities (DREAL) during 2018. Tenders for the proposed remediation work were issued in 2020 and a preferred supplier of the remedial works has been identified. These proposed works are the subject of discussions taking place with the French environmental authorities before adoption of the final plan for the site and conduct of the remediation activity. Based on the information available at this time, the company does not believe that this matter will have a material adverse effect upon its liquidity, results of operations or financial condition.

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The company’s operations in Brazil are involved in various governmental assessments, which have historically mainly related to claims for taxes on the internal transfer of inventory, gross revenue taxes, and indirect tax incentives and deductibility of goodwill. In addition, one of the company’s Brazilian subsidiaries received an income tax assessment focused on the disallowance of deductions associated with the acquisition price paid to a third party for a portion of its operations. The company does not believe that the ultimate resolution of these matters will materially impact its results of operations, financial position or cash flows. Under customary local regulations, the company’s Brazilian subsidiaries may need to post cash or other collateral if the process to challenge any administrative assessment proceeds to the Brazilian court system; however, the level of any potential cash or collateral required would not significantly impact the liquidity of those subsidiaries or Ball Corporation.

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During 2017, the Brazilian Supreme Court (the Court) ruled against the Brazilian tax authorities in a leading case related to the computation of certain indirect taxes. The Court ruled that the indirect tax base should not include a value-added tax known as “ICMS.” By removing the ICMS from the tax base, the Court effectively eliminated a “tax on tax.” The Court decision, in principle, affects all applicable judicial proceedings in progress. However, after publication of the decision in October 2017, the Brazilian tax authorities filed an appeal seeking clarification of certain matters, including the amount of ICMS to which taxpayers would be entitled in order to reduce their indirect tax base (i.e., the gross rate or net rate).

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The company’s Brazilian subsidiaries paid to the Brazilian tax authorities the gross amounts of certain indirect taxes (which included ICMS in their tax base) and filed lawsuits in 2014 and 2015 to challenge the legality of these tax on tax amounts. Pursuant to these lawsuits, the company requested reimbursement of prior excess tax payments and entitlement to retain amounts not remitted. During 2018, the company learned of a further decision of the Court indicating that lawsuits filed prior to the trial resulting in its 2017 decision, such as those filed by the company, would likely be upheld. The company also noted that other Brazilian companies, including customers of its Brazilian subsidiaries, which had timely filed equivalent lawsuits, were recording income based on the applicable ICMS amounts retained. During 2021, 2020 and 2019, the company received additional favorable court rulings and completed its analysis of certain prior year overpayments related to ICMS. As these gain contingency amounts were determined to be estimable and realizable, the company recorded $22 million of prior year collections in business consolidation and other activities within its consolidated statement of earnings for the period ended December 31, 2021. As of March 31, 2022, the company has no additional claims outstanding that would result in material reimbursements.

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22. Indemnifications and Guarantees

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General Guarantees

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The company or its appropriate consolidated direct or indirect subsidiaries have made certain indemnities, commitments and guarantees under which the specified entity may be required to make payments in relation to certain transactions. These indemnities, commitments and guarantees include indemnities to the customers of the subsidiaries in connection with the sales of their packaging and aerospace products and services; guarantees to suppliers of subsidiaries of the company guaranteeing the performance of the respective entity under a purchase agreement, construction contract, renewable energy purchase contract or other commitment; guarantees in respect of certain non-U.S. subsidiaries’ pension plans; indemnities for liabilities associated with the infringement of third-party patents, trademarks or copyrights under various types of agreements; indemnities to various lessors in connection with facility, equipment, furniture and other personal property leases for certain claims arising from such leases; indemnities to governmental agencies in connection with the issuance of a permit or license to the company or a subsidiary; indemnities pursuant to agreements relating to certain joint ventures; indemnities in connection with the sale of businesses or substantially all of the assets and specified liabilities of businesses; and indemnities to directors, officers and employees of the company to the extent permitted under the laws of the State of Indiana and the United States of America. The duration of these indemnities, commitments and guarantees varies and, in certain cases, is indefinite.

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In addition, many of these indemnities, commitments and guarantees do not provide for any limitation on the maximum potential future payments the company could be obligated to make. As such, the company is unable to reasonably estimate its potential exposure under these items.

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The company has not recorded any material liabilities for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets. The company does, however, accrue for payments under promissory notes and other evidences of incurred indebtedness and for losses for any known contingent liability, including those that may arise from indemnifications, commitments and guarantees, when future payment is both reasonably estimable and probable. Finally, the company carries specific and general liability insurance policies and has obtained indemnities, commitments and guarantees from third-party purchasers, sellers and other contracting parties, which the company believes would, in certain circumstances, provide recourse to certain claims arising from these indemnifications, commitments and guarantees.

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Debt Guarantees

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The company’s and its subsidiaries’ obligations under the senior notes and senior credit facilities (or, in the case of U.S. domiciled non-U.S. subsidiaries under the senior credit facilities, the obligations of non-U.S. credit parties only) are guaranteed on a full, unconditional and joint and several basis by certain of the company’s domestic subsidiaries and the domestic subsidiary borrowers, and obligations of other guarantors and the subsidiary borrowers under the senior credit facilities are guaranteed by the company, in each case with certain exceptions. These guarantees are required in support of the senior notes and senior credit facilities referred to above, are coterminous with the terms of the respective note indentures, senior notes and credit agreement, and they could be enforced by the holders of the obligations thereunder during the continuation of an event of default under the note indentures, the senior notes and/or the credit agreement. The maximum potential amounts which could be required to be paid under such guarantees are essentially equal to then-outstanding obligations under the respective senior notes or the credit agreement (or, in the case of U.S. domiciled non-U.S. subsidiaries under the senior credit facilities, the obligations of non-U.S. credit parties only), with certain exceptions. All obligations under the guarantees of the senior credit facilities are secured, with certain exceptions, by a valid first priority perfected lien or pledge on (i) 100 percent of the capital stock of each of the company's material wholly owned domestic subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries and (ii) 65 percent of the capital stock of each of the company's material wholly owned first-tier non-U.S. subsidiaries directly owned by the company or any of its wholly owned domestic subsidiaries. In addition, the obligations of certain non-U.S. borrowers and non-U.S. pledgors under the loan documents will be secured, with certain exceptions, by a valid first priority perfected lien or pledge on 100 percent of the capital stock of certain of the company's material wholly owned non-U.S. subsidiaries and material wholly owned U.S. domiciled non-U.S. subsidiaries directly owned by the company or any of its wholly owned material subsidiaries. The company is not in default under the above senior notes or senior credit facilities.

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