SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

During the year ended December 31, 2022, our organizational structure consisted of three market-focused business segments: Pharma, Beauty+Home and Food+Beverage. Effective January 1, 2023, we realigned two of our segments, allowing us to better serve our customers and positioning us for long-term profitable growth. We continue to have three reporting segments; Aptar Pharma and Aptar Beauty are named for the markets they serve with multiple product platforms, while Aptar Closures is named primarily for a single product platform that serves all available markets.

We combined all of our closures operations into a single segment - Aptar Closures. The Aptar Closures business serves multiple markets, including food, beverage, personal care, home care, beauty and healthcare. Closures that were developed in Beauty + Home moved to Aptar Closures together with the operations of legacy Food + Beverage. Aptar's food protection business and our elastomeric flow-control technology business continue to report through the Aptar Closures segment.

At the same time, we are simplifying and focusing our Beauty + Home segment to better leverage our complex spray and dispensing solutions for prestige and premium brands in the beauty and personal care markets. For many of our customers, personal care products are considered part of "beauty" and so we renamed this segment, simply, Aptar Beauty. The segment realignment had no impact on our consolidated statements of income, balance sheets, and cash flows. Segment financial information for the prior periods has been recast to conform to the current presentation.

The accounting policies of the segments are the same as those described in Part II, Item 8, Note 1 – Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the year ended December 31, 2022. We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring initiatives, acquisition-related costs, net unrealized investment gains and losses related to observable market price changes on equity securities and other special items.

Financial information regarding our reporting segments is shown below:

Three Months Ended March 31,	2023		2022
Total Sales:
Aptar Pharma	$	356,111	$	346,672
Aptar Beauty	333,338		315,368
Aptar Closures	180,439		196,068
Total Sales	$	869,888	$	858,108
Less: Intersegment Sales:
Aptar Pharma	$	65	$	4,210
Aptar Beauty	6,949		6,288
Aptar Closures	2,807		2,678
Total Intersegment Sales	$	9,821	$	13,176
Net Sales:
Aptar Pharma	$	356,046	$	342,462
Aptar Beauty	326,389		309,080
Aptar Closures	177,632		193,390
Net Sales	$	860,067	$	844,932
Adjusted EBITDA (1):
Aptar Pharma	$	109,298	$	115,552
Aptar Beauty	37,205		34,550
Aptar Closures	26,008		24,183
Corporate & Other, unallocated	(18,836)		(17,970)
Acquisition-related costs (2)	(255)		—
Restructuring Initiatives (3)	(11,524)		(291)
Net unrealized investment gain (loss) (4)	188		(2,091)
Depreciation and amortization	(59,259)		(58,665)
Interest Expense	(10,228)		(8,930)
Interest Income	672		288
Income before Income Taxes	$	73,269	$	86,626

________________________________________________

(1)We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring initiatives, acquisition-related costs, net unrealized investment gains and losses related to observable market price changes on equity securities and other special items.

(2)Acquisition-related costs include transaction costs (and purchase accounting adjustments related to acquisitions and investments) (see Note 17 – Acquisitions for further details).

(3)Restructuring Initiatives includes expense items for the three months ended March 31, 2023 and 2022 as follows (see Note 19 – Restructuring Initiatives for further details):

Three Months Ended March 31,	2023		2022
Restructuring Initiatives by Plan:
Optimization initiative	$	11,540	$	—
Prior year initiatives	(16)		291
Total Restructuring Initiatives	$	11,524	$	291
Restructuring Initiatives by Segment:
Aptar Pharma	$	1,131	$	—
Aptar Beauty	9,291		111
Aptar Closures	522		180
Corporate & Other	580		—
Total Restructuring Initiatives	$	11,524	$	291

(4)Net unrealized investment gain (loss) represents the change in fair value of our investment in PCT (see Note 18 – Investment in Equity Securities for further details).