FDBusiness.com

Europe is going to be a ‘long fight’, says Silgan CEO

 Breaking News
  • Arla Foods Acquires Middle East and Africa Kraft Branded Cheese Business From Mondeléz International European dairy co-operative Arla Foods has reached an agreement with US-based international confectionery, food, and beverage company Mondeléz International to acquire its processed cheese business in the Middle East region, which is currently licensed under the Kraft brand. The acquisition also gives Arla full ownership of a state-of-the-art cheese production site in Bahrain, which provides [...]...
  • UK Grocery Market Growth Cools as Christmas Nears Despite retailers and shoppers getting into the festive spirit, the latest grocery market share figures from Kantar Worldpanel, for the 12 weeks to 2 December 2018, show the sector is now growing at 2.0% – its slowest rate since March 2017. Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, comments: “Consumers are benefiting [...]...
  • Cleveland Clinic Studies Reveal Role of Red Meat in Gut Bacteria, Heart Disease Development In concurrent studies, Cleveland Clinic researchers have uncovered new mechanisms that demonstrate why and how regularly eating red meat can increase the risk of heart disease, and the role gut bacteria play in that process. The research, led by Stanley Hazen, M.D., Ph.D., builds upon previous work showing TMAO (trimethylamine N-oxide) – a gut bacteria [...]...
  • The Complete Package at Contract Pack 2019 Packaging Innovations 2019 is set to welcome back Contract Pack for the twelfth-year at Birmingham’s NEC on 27 & 28 February 2019. Supported by the British Contract Manufacturers and Packers Association (BCMPA), the Contract Pack 2019 zone will host 20 BCMPA accredited exhibitors, offering an unrivaled opportunity for brand owners and manufacturers to meet potential [...]...
  • Müller Completes Largest Single Investment in Scottish Dairy Processing in a Decade Müller Milk & Ingredients has completed a £15 million project to substantially upgrade Scotland’s largest fresh milk dairy in Bellshill and secure 265 jobs. The project represents the largest single investment in Scottish dairy processing for more than a decade. It gives Müller’s Bellshill dairy the capacity to process more than 370 million litres of fresh [...]...

Europe is going to be a ‘long fight’, says Silgan CEO

April 24
09:54 2013

The situation in Europe is not improving but is not dramatically worse either and acquisitions in the region remain a possibility, according to Silgan.

In a conference call with analysts discussing the firm’s Q1 financial results, Tony Allott, president and CEO, said: “I think our view in Europe at this point is, broadly, that it’s going to have a long fight here.

“Now the trickier, sometimes, opportunity is exactly where things are at their worst. And so you can’t — you would never want to say no acquisitions in Europe because you might find great opportunity there.”

He added they were pleased with the results as the business performed as expected in the quarter.

Allot added: ““Our metal container business benefited from strong soup and pet food sales in North America and continued to reduce inventory in line with our working capital goals.

“Our plastic container business delivered solid operating performance in the face of the negative impact of increases in resin costs and volume realignment in our legacy business.

“Our closure business was also negatively impacted by significant increases in resin costs and the devaluation of currency in Venezuela.”

Metal Containers

Net sales of the metal container business were $463.8m for Q1 2013, an increase of 4.2%, as compared to $444.9m in 2012 due to the increase in unit volumes and higher average selling prices as a result of the pass through of higher raw material costs.

Income from operations of the metal container business in Q1 2013 decreased $2.4m to $39.6m and operating margin decreased to 8.5% from 9.4% over the same periods.

Rationalization charges were $1.1m in the quarter for the shutdown of the Crystal City, Texas manufacturing facility and a restructuring of the Sacramento, California site. Plant start-up costs were $0.8m and $1m in Q1 2013 and 2012, respectively.

Closures

Net sales of the closures business were $161.1m in Q1 2013, a decrease of 1.2%, as compared to $163m in 2012 due to unfavorable impact from the devaluation of currency in Venezuela, partially offset by higher average selling prices as a result of the pass through of higher raw material costs.

Income from operations of the closures business for Q1 2013 decreased $7.4m to $10.6m and operating margin decreased to 6.6% from 11% over the same periods.

“The surprises in the quarter were the devaluation of the Venezuelan Bolivar, resulting in a $3m charge for the remeasurement of assets; the operational challenges as political instability in Venezuela led to an inability to acquire sufficient raw materials; and the timing of certain statutory rate changes, which led to a temporarily higher tax rate,” explained Robert Lewis, chief financial officer and executive vice president in the firm’s conference call.

Plastic Containers

Net sales of the plastic container business were $170.8m in the first quarter of 2013, an increase of $10.3m due to the inclusion of net sales from the plastic food container operations acquired in August 2012, partially offset by lower volumes in the legacy operations.

Income from operations of the plastic container business for Q1 2013 was $10.4m, an increase of $1.5m from 2012, and operating margin increased to 6.1% from 5.5% over the same periods.

The increase in income from operations was because of the inclusion of the plastic food container operations and lower rationalization charges, partially offset by the unfavorable impact from the lagged pass through of increases in resin prices in the current year quarter.

When asked about Can Vision 2020, Allott added progress remained good but stressed it was a long term project.

“But we continue to be pleased with the opportunities that we’re seeing. We’ve spent on this — something like $1m this quarter on it. We’ll continue to spend, and then there will be capital as we get closer to meaningful investments with customers.”

About Author

colin

colin

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • June 18, 2019Multimodal 2019
AEC v1.0.4

Jobs: Food Packaging

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements