Crown reports beverage can volumes up by 6%
Crown Holdings, Inc. announced its financial results for the third quarter ended September 30, 2022.
Highlights included earnings per share of $1.06 versus $0.79 in 2021, global beverage can volumes up by 6%, and the repurchasing of $722 million in Company shares year to date.
Net sales in the third quarter were $3,259 million compared to $2,920 million in the third quarter of 2021 reflecting increased beverage can unit volumes and the pass through of higher raw material costs partially offset by unfavourable foreign currency translation of $127 million.
Income from operations was $297 million in the third quarter compared to $348 million in the third quarter of 2021. Segment income in the third quarter of 2022 was $336 million compared to $379 million in the prior year third quarter reflecting higher energy prices, costs associated with higher inventory levels and unfavourable foreign currency translation of $8 million.
Commenting on the quarter, Timothy J. Donahue, Chairman, President and Chief Executive Officer, said: “Third quarter global beverage can shipments outpaced the prior year third quarter by 6% led by robust shipments in Brazil, Mexico and Vietnam.
“While shipments advanced versus the prior year, they were short of our earlier expectations leading to more inventory on hand throughout and at the end of the quarter. Since our last earnings release in mid-July, the impacts from inflation, European energy prices, interest rates and currency have become more challenging.
“With input costs expected to remain elevated prior to our contractual inflationary resets in 2023, and many customers adjusting their order patterns in response to lower consumer spending, we expect the operating environment and margins to remain under pressure for the balance of 2022.
“While the short-term environment is expected to remain challenging, we continue to focus on activities that will enhance our long-term success and remain confident in our outlook for 2023.
“Our global beverage can expansion projects remain on schedule, including both new two-line plants in the United States, with Martinsville, Virginia expecting to commence operations in November 2022 and Mesquite, Nevada in June 2023.
“The first line of our new facility in Uberaba, Brazil began commercial production in May and the second line earlier this month. The Company has begun construction on a multi-line facility in Peterborough, United Kingdom, with the first line scheduled to start up in June 2023. Additional production lines are being added to existing plants in Phnom Penh, Cambodia; Agoncillo, Spain; and Parma, Italy.
“Understanding we cannot control inflation or interest rates, we have focused on actions to lower costs for the current environment by reducing headcount and lowering capital spending. Additionally, in August, we extended our existing credit facility to August 2027, and raised an incremental $1.0 billion with the additional proceeds used to retire euro notes originally due in 2023.
“The balance sheet remains strong with no significant maturities until September 2024.ˮ
Interest expense was $76 million in the third quarter of 2022 compared to $66 million in 2021 reflecting higher interest rates.
The Company recorded a charge of $11 in the third quarter of 2022 for the write-off of deferred financing fees and premium payments in connection with the early repayment of notes and the refinancing of the credit facility and term loans.
Net income attributable to Crown Holdings in the third quarter was $127 million compared to $102 million in the third quarter of 2021.
Reported diluted earnings per share were $1.06 in the third quarter of 2022 compared to $0.79 in 2021. Adjusted diluted earnings per share was $1.46 compared to $2.03 in 2021.