Highlights:
*Record net income of $1.01 per diluted share, a 38% increase over the prior year quarter
*Record adjusted net income of $1.04 per diluted share, a 37% increase over the prior year quarter
*Record income before interest and income taxes of $174.0 million
*Achieved record segment volume in each of the businesses
/Segment income for closures and plastic container businesses at record levels
Silgan Holdings Inc. (Nasdaq:SLGN), a leading supplier of sustainable rigid packaging solutions for consumer goods products, today reported record third quarter 2020 net income of $112.9 million, or $1.01 per diluted share, as compared to third quarter 2019 net income of $81.3 million, or $0.73 per diluted share.
Adjusted net income per diluted share was a record $1.04 for the third quarter of 2020, after adjustments increasing net income per diluted share by $0.03. Adjusted net income per diluted share in the third quarter of 2019 was $0.76, after adjustments increasing net income per diluted share by $0.03. A reconciliation of net income per diluted share to “adjusted net income per diluted share,” a Non-GAAP financial measure used by the Company that adjusts net income per diluted share for certain items, can be found in Tables A and B at the back of this press release.
“Each of our segments continued to perform exceptionally well during the third quarter, driving strong segment income across the board and a 37 percent improvement in adjusted earnings per diluted share over the previous record quarter in 2019,” said Tony Allott, Chairman and CEO. “Volume gains across all of our businesses have proved lasting, both through the early lockdown stage of the pandemic and as economies opened up again during the summer. Equally as rewarding has been the outstanding operational performance of the entire Silgan team to meet this demand growth during a challenging time and to demonstrate our unparalleled support for our customers. Each of our businesses has significantly outperformed our competition during these extraordinary times, and our customers continue to reward Silgan with additional volume opportunities,” continued Mr. Allott. “Volume growth of 17 percent in our metal container business continued to be driven primarily by increased at home food consumption and growing consumer awareness of the value and other benefits of canned foods. Our closures business continues to experience strong volume demand primarily for sprayers, foamers and pumps for household cleaning and hygiene products, with legacy dispensing closures volumes up approximately 22 percent which more than offset weakness in certain beauty products. Our plastic container business has continued to demonstrate its market leading customer service model, driving further volume growth of 14 percent and again nearly doubling segment income over the third quarter of 2019,” continued Mr. Allott. “Given anticipated continued strong market demand levels, our great operational performance across the board and our continued confidence in the Silgan team, we are again increasing our outlook for adjusted earnings for 2020 from $2.70 to $2.85 per share to $2.92 to $2.97 per share. At the midpoint of this range, Silgan would have increased adjusted earnings by 36 percent over the record prior year level and delivered a 10 year adjusted earnings per share compound annual growth rate of over 10 percent. While we are still completing our annual budget process for 2021, at this time we anticipate overall operating earnings for the Company remaining at these strong levels,” concluded Mr. Allott.
Net sales for the third quarter of 2020 were $1.49 billion, an increase of $167.2 million, or 12.7 percent, as compared to the same period in the prior year. This increase was the result of higher net sales in all of the businesses.
Income before interest and income taxes for the third quarter of 2020 was $174.0 million, an increase of $41.3 million as compared to $132.7 million for the third quarter of 2019, and margins increased to 11.7 percent from 10.0 percent for the same periods. The increase in income before interest and income taxes was the result of higher income in each of the businesses. Rationalization charges were $2.5 million and $3.2 million for the third quarters of 2020 and 2019, respectively, and acquisition related costs were $0.7 million in the third quarter of 2020.
Interest and other debt expense before loss on early extinguishment of debt for the third quarter of 2020 was $27.7 million, an increase of $1.0 million as compared to the third quarter of 2019. This increase was due to higher average outstanding borrowings primarily related to the acquisition of the dispensing operations of the Albéa Group, partially offset by lower weighted average interest rates.
The effective tax rates were 22.9 percent and 22.0 percent for the third quarters of 2020 and 2019, respectively, both of which were favorably impacted by an audit period expiration.
more detail at: https://silganholdingsinc.gcs-web.com/news-releases/news-release-details/silgan-announces-new-records-further-raises-full-year-earnings