BALL · 10-Q · 2026Q2 · Full report
Operating Margin Drivers
BALL Corp · 2026-08-04 · Importance 59 · Surprise 48 · From source text
Cost of sales excluding depreciation and amortization increased $610 million to $3.300 billion in the second quarter and $1.074 billion to $6.257 billion in the first half of 2026. Raw-material costs increased $506 million in the second quarter and $871 million in the first half, primarily because of higher aluminum prices and volumes. Cost of sales represented 83% of sales in the second quarter and 82% in the first half, up from 81% in both prior-year periods, indicating gross-margin pressure from input costs. North and Central America first-half comparable operating earnings were flat as $55 million of price/mix and $20 million of volume gains were fully offset by $74 million of higher operating and plant-startup costs, while EMEA earnings increased $33 million and South America earnings increased $32 million.
Key facts
- Cost of sales excluding depreciation and amortization for the three months ended June 30, 2026: $3,300 million; for the three months ended June 30, 2025: $2,690 million. source
- Cost of sales excluding depreciation and amortization for the six months ended June 30, 2026: $6,257 million; for the six months ended June 30, 2025: $5,183 million. source
- Business consolidation and other activities charges: $22 million and $12 million for the three months ended June 30, 2026 and 2025, respectively; $33 million and $25 million for the six months ended June 30, 2026 and 2025, respectively. source
- The six months ended June 30, 2026 SG&A increase was primarily due to a loss of $27 million recognized related to the fair value of the ORG equity-linked notes. source
- Beverage Packaging EMEA comparable operating earnings for the three and six months ended June 30, 2026 were $10 million and $33 million higher, respectively, compared to same periods in 2025; three month increase primarily due to $58 million from price/mix and higher volume partially offset by $71 million higher costs. source
- Beverage Packaging South America comparable operating earnings for the three and six months ended June 30, 2026 were $32 million higher when compared to the same periods in 2025; six month increase primarily due to higher price/mix of $47 million partially offset by higher costs of $24 million. source
- Interest income was $10 million and $5 million for the three months ended June 30, 2026 and 2025, respectively, and $20 million and $12 million for the six months ended June 30, 2026 and 2025, respectively. source
- Selling, general and administrative expense for the three months ended June 30, 2026: $163 million; for the three months ended June 30, 2025: $137 million. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | negative | realized | -26.9% | Cost of sales excluding depreciation and amortization for the six months ended June 30, 2026: $6,257 million; for the six months ended… |
| operating_income | negative | realized | -15.3% | Cost of sales excluding depreciation and amortization for the three months ended June 30, 2026: $3,300 million; for the three months ended… |
| operating_income | positive | realized | +0.8% | Beverage Packaging EMEA comparable operating earnings for the three and six months ended June 30, 2026 were $10 million and $33 million… |
| operating_income | positive | realized | +0.8% | Beverage Packaging South America comparable operating earnings for the three and six months ended June 30, 2026 were $32 million higher… |
| operating_income | negative | realized | -0.7% | The six months ended June 30, 2026 SG&A increase was primarily due to a loss of $27 million recognized related to the fair value of the… |
| operating_income | negative | realized | -0.2% | Business consolidation and other activities charges: $22 million and $12 million for the three months ended June 30, 2026 and 2025,… |