Crown Holdings Announces 2008 Fourth Quarter and Full Year Results
2008 Highlights
-- Net sales grew 7.5% to $8.3 billion
-- Gross profit improved 19% to $1.2 billion
-- Segment income rose 28.7% to $826 million
Fourth Quarter Results
Net sales in the fourth quarter were
Fourth quarter gross profit rose 10.3% to
Selling and administrative expense in the fourth quarter was
Segment income (a non-GAAP measure defined by the Company as gross profit less selling and administrative expense) grew to
Commenting on the results,
Interest expense in the fourth quarter was
The Company recorded a loss on the translation of foreign currency exposures in the fourth quarter of
The Company recorded a charge in the fourth quarter of
In the fourth quarter of 2008, the Company recorded a restructuring charge of
The Company recorded a provision for asset impairments of
The provision for income taxes in the fourth quarter of 2008 was a benefit of
In the fourth quarter of 2008, the Company recorded a net loss of
The following table reconciles net (loss)/income as reported to net income before the items described above.
Three Months Twelve Months
Ended December 31, Ended December 31,
------------------- -------------------
2008 2007 2008 2007
---- ---- ---- ----
Net (loss)/income as reported ($14) $326 $226 $528
Items, net of tax:
Provision for asbestos 15 29 15 29
Provision for restructuring 17 5 19 17
Provision for asset
impairments/loss on sales
of assets 6 114 9 103
Loss from early extinguishments
of debt 2
Intercompany debt and balance
sheet translation 11 17
Income taxes (462) (5) (462)
Net income before the above items $35 $12 $283 $215
(Loss)/income per diluted common
share as reported ($0.09) $2.00 $1.39 $3.19
Income per diluted common share
before the above items $0.22 $0.07 $1.74 $1.30
Net income before the above items and income per diluted common share before the above items are non-GAAP measures.
Full Year Results
For 2008, net sales rose to
Gross profit for the year grew 19.0% to
Selling and administrative expense for 2008 was
Segment income in 2008 increased 28.7% to
Interest expense was
The provision for income taxes for 2008 was
For 2008, the Company reported net income of
Net debt (a non-GAAP measure defined by the Company as total debt less cash) decreased by
Debt and cash amounts were:
December 31, September 30, December 31, September 30,
2008 2008 2007 2007
---- ---- ---- ----
Total debt $3,337 $3,533 $3,437 $3,763
Cash 596 332 457 348
------ --- --- ---
Net debt $2,741 $3,201 $2,980 $3,415
====== ====== ====== ======
Receivables
securitization $234 $308 $272 $328
==== ==== ==== ====
At
Net cash provided by operating activities in 2008 was
Non-GAAP Measures
Segment income, free cash flow and net debt are not defined terms under U.S. generally accepted accounting principles (non-GAAP measures). In addition, the information presented above regarding net income before certain items does not conform to GAAP and includes non-GAAP measures. Non-GAAP measures should not be considered in isolation or as a substitute for net income, cash flow or total debt data prepared in accordance with U.S. GAAP and may not be comparable to calculations of similarly titled measures by other companies.
The Company views segment income and free cash flow as the principal measures of performance of its operations and for the allocation of resources. The Company believes net debt is a useful measure of the Company's debt levels and that net income before certain items can be used to evaluate the Company's operations. Segment income, free cash flow, net debt and net income before certain items are derived from the Company's Consolidated Statements of Operations and Cash Flows and Consolidated Balance Sheets, as applicable, and reconciliations to segment income, free cash flow, net debt and net income before certain items can be found within this release.
Conference Call
The Company will hold a conference call tomorrow,
Cautionary Note Regarding Forward-Looking Statements
Except for historical information, all other information in this press release consists of forward-looking statements. These forward-looking statements involve a number of risks, uncertainties and other factors, including the Company's ability to grow in developing markets such as
About
For more information, contact:
Edward Bisno,
Unaudited Consolidated Statements of Operations, Balance Sheets, Statements of Cash Flows and Segment Information follow this page.
Consolidated Statements of Operations (Unaudited)
-------------------------------------------------
(in millions, except share and per share data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
----------- -----------
2008 2007 2008 2007
---- ---- ---- ----
Net sales $1,877 $1,871 $8,305 $7,727
------ ------ ------ ------
Cost of products sold 1,590 1,596 6,867 6,471
Depreciation and
amortization 51 61 216 229
Gross profit (1) 236 214 1,222 1,027
Selling and administrative
expense 87 100 396 385
Provision for asbestos 25 29 25 29
Provision for restructuring 17 6 21 20
Provision for asset
impairments and loss on
sales of assets 6 114 6 100
Loss from early
extinguishments of debt 2
Interest expense 70 86 302 318
Interest income (3) (5) (11) (14)
Translation and foreign
exchange adjustments 25 1 39 (12)
-- - -- ----
Income/(loss) before income
taxes, minority interests
and equity earnings 9 (117) 442 201
(Benefit) from/provision
for income taxes (1) (462) 112 (400)
Minority interests and
equity earnings (24) (19) (104) (73)
-- -- --- --
Net (loss)/income ($14) $326 $226 $528
==== ==== ==== ====
(Loss)/income per common
share:
Basic ($0.09) $2.05 $1.42 $3.27
======= ===== ===== =====
Diluted ($0.09) $2.00 $1.39 $3.19
======= ===== ===== =====
Weighted average common
shares outstanding:
Basic 159,527,322 158,876,567 159,589,240 161,331,007
Diluted 162,204,888 162,741,499 162,931,236 165,464,273
Actual common shares
outstanding 159,191,238 159,777,628 159,191,238 159,777,628
Diluted earnings per share for the three months ended December 31, 2008
were the same as basic because common shares contingently issuable upon
the exercise of stock options were anti-dilutive.
(1) A reconciliation from gross profit to segment income is found on
the following page.
Consolidated Supplemental Financial Data (Unaudited)
----------------------------------------------------
(in millions)
Reconciliation from Gross Profit to Segment Income
The Company views segment income, as defined below, as a principal
measure of performance of its operations and for the allocation of
resources. Segment income is defined by the Company as gross profit
less selling and administrative expense. A reconciliation from gross
profit to segment income for the three and twelve months ended December
31, 2008 and 2007 follows:
Three Months Twelve Months
Ended Ended
December 31, December 31,
----------- -----------
2008 2007 2008 2007
---- ---- ---- ----
Gross profit $236 $214 $1,222 $1,027
Selling and
administrative expense 87 100 396 385
Segment income $149 $114 $826 $642
Segment Information
Three Months Ended Twelve Months Ended
December 31, December 31,
Net Sales 2008 2007 2008 2007
--------- ---- ---- ---- ----
Americas Beverage $451 $415 $1,865 $1,751
North America Food 230 199 905 849
European Beverage 329 341 1,607 1,436
European Food 458 499 2,188 1,991
European Specialty Packaging 88 111 445 460
Total reportable segments 1,556 1,565 7,010 6,487
Non-reportable segments 321 306 1,295 1,240
Total net sales $1,877 $1,871 $8,305 $7,727
Segment Income
--------------
Americas Beverage $37 $34 $191 $182
North America Food 25 16 91 76
European Beverage 36 37 249 185
European Food 41 35 232 173
European Specialty Packaging (2) (4) 18 14
Total reportable segments 137 118 781 630
Non-reportable segments 43 36 181 133
Corporate and unallocated items (31) (40) (136) (121)
Total segment income $149 $114 $826 $642
Consolidated Balance Sheets (Condensed & Unaudited)
(in millions)
December 31, 2008 2007
Assets
Current assets
Cash and cash equivalents $596 $457
Receivables, net 734 673
Inventories 979 1,030
Prepaid expenses and other current assets 148 74
Total current assets 2,457 2,234
Goodwill 1,956 2,199
Property, plant and equipment, net 1,473 1,604
Other non-current assets 863 942
Total $6,749 $6,979
Liabilities and shareholders' (deficit)/equity
Current liabilities
Short-term debt $59 $45
Current maturities of long-term debt 31 38
Other current liabilities 1,982 2,000
Total current liabilities 2,072 2,083
Long-term debt, excluding current maturities 3,247 3,354
Other non-current liabilities and minority
interests 1,747 1,527
Shareholders' (deficit)/equity (317) 15
Total $6,749 $6,979
Consolidated Statements of Cash Flows (Condensed & Unaudited)
-------------------------------------------------------------
(in millions)
Twelve months ended December 31, 2008 2007
Cash flows from operating activities
Net income $226 $528
Depreciation and amortization 216 229
Provision for asset impairments and (gain)/loss
on sale of assets 6 100
Deferred income taxes 23 (486)
Accounts receivable (110) 68
Inventories (23) (19)
Accounts payable and accrued liabilities 38 61
Other, net 46 28
Net cash provided by operating activities(A) 422 509
Cash flows from investing activities
Capital expenditures (174) (156)
Proceeds from sales of business and property,
plant and equipment 15 73
Other, net (27) (11)
Net cash used for investing activities (186) (94)
Cash flows from financing activities
Net change in debt (52) (224)
Common share repurchases (35) (118)
Other, net 10 (54)
Net cash used for financing activities (77) (396)
Effect of exchange rate changes on cash and cash
equivalents (20) 31
Net change in cash and cash equivalents 139 50
Cash and cash equivalents at January 1 457 407
Cash and cash equivalents at December 31 $596 $457
(A) Free cash flow is defined by the Company as net cash provided by
operating activities less capital expenditures. A reconciliation
from net cash provided by operating activities to free cash flow for
the twelve months ended December 31 follows:
Twelve months ended December 31, 2008 2007
---- ----
Net cash provided by operating activities $422 $509
Capital expenditures (174) (156)
---- ----
Free cash flow $248 $353
==== ====
SOURCECrown Holdings, Inc. -0-02/02/2009 /CONTACT:Timothy J. Donahue , Executive Vice-President and Chief Financial Officer, +1-215-698-5088, or Edward Bisno,Bisno Communications , +1-212-717-7578., both ofCrown Holdings, Inc. / /Web Site: https://www.crowncork.com / (CCK) CO:Crown Holdings, Inc. ST:Pennsylvania IN: FIN PAP SU: ERN CCA PR -- PH65629 -- 942902/02/2009 17:13 EST http://www.prnewswire.com
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