PHILADELPHIA, Oct. 19, 2015 /PRNewswire/ -- Crown Holdings, Inc. (NYSE: CCK) today announced its financial results for the third quarter ended September 30, 2015.

Third Quarter Highlights

  • Earnings per share $1.01; Before Certain Items $1.34, including $0.21 of unfavorable currency translation
  • YTD earnings per share $2.35; Before Certain Items $2.89, including $0.41 of unfavorable currency translation
  • Earnings per share before certain items on a constant-currency basis grew 14% in third quarter, 12% YTD
  • On a constant-currency basis, Q3 revenue grew 6%, segment income grew 13%
  • Global beverage can volumes grew 13% in the quarter over 2014

Net sales in the third quarter were $2,460 million, including $281 million of unfavorable currency translation, compared to $2,594 million in the third quarter of 2014.

Segment income (a non-GAAP measure defined by the Company as gross profit excluding the impact of fair value adjustments to inventory acquired in an acquisition and the timing impact of hedge ineffectiveness, less selling and administrative expense) was $328 million in the third quarters of both 2015 and 2014, and included $41 million of unfavorable currency translation in 2015 compared to 2014.

Commenting on the quarter,John W. Conway, Chairman and Chief Executive Officer, stated, 'The Company had an excellent performance during the seasonally very important third quarter, as constant-currency net income per share before certain items increased 14% over prior year and constant-currency segment income rose 13% over prior year.

'Global beverage can shipments increased 13% over 2014 during the quarter largely as a result of the recent acquisition of Empaque in Mexico. Excluding the impact from Empaque, shipment volumes advanced 5% in the quarter compared to 2014 with notable growth in the United States, Southern and Eastern Europe and in Southeast Asia. We again benefited from our industry-leading geographic beverage can presence, which includes strong regional platforms and an excellent and diverse customer portfolio. In addition, segment income in European Food grew over 8% on a constant-currency basis compared to last year's third quarter, reflecting a good harvest and the successful integration of the Mivisa facilities acquired in April of 2014.'

Interest expense increased to $68 million in the third quarter of 2015 over the $64 million in 2014 primarily due to increased borrowings to fund the Empaque acquisition.

During the third quarter of 2015, the Company recorded restructuring and other charges of $40 million primarily for severance costs and asset write downs related to projects in its North America and European Food segments.

The Company's effective tax rate for the quarter was 23.1%, or 21.2% based on earnings before certain items. The adjusted rate of 21.2% includes the favorable impact of tax benefits in Brazil as the weaker Brazilian real resulted in local tax deductions for foreign exchange losses on U.S. dollar borrowings. The positive impact of these tax benefits partially offset the negative impact of the weaker Brazilian real on income before tax.

Net income attributable to Crown Holdings in the third quarter was $141 million compared to $244 million in the third quarter of 2014. Reported earnings per diluted share were $1.01 in the third quarter of 2015 and $1.76 in the 2014 third quarter. Net income per diluted share before certain items was $1.34 compared to $1.36 in 2014.

A reconciliation from net income and income per diluted share to net income before certain items and income per diluted share before certain items is provided below.

Nine Month Results
Net sales for the first nine months of 2015 were $6,735 million, including $694 million of unfavorable currency translation, compared to $6,970 million in the first nine months of 2014.

Segment income in the first nine months of 2015 was $792 million, including $87 million of unfavorable currency translation, compared to $813 million in the same period of 2014.

Interest expense for the first nine months of 2015 increased to $202 million compared to $188 million in the prior year primarily due to increased borrowings to fund the Mivisa and Empaque acquisitions.

Net income attributable to Crown Holdings for the first nine months of 2015 was $327 million versus $374 million in the first nine months of 2014. Income per diluted share for the first nine months of 2015 was $2.35 compared to $2.70 last year. Net income per diluted share before certain items was $2.89 compared to $2.94 in 2014.

Non-GAAP Measures
Segment income and free cash flow are not defined terms under U.S. generally accepted accounting principles (non-GAAP measures). In addition, the information presented excluding the impact of currency translation, regarding revenue, segment income, net income before certain items, the effective tax rate before certain items and income before certain items per diluted share 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, the effective tax rate, income per diluted share or cash flow 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. Free cash flow has certain limitations, however, including that it does not represent the residual cash flow available for discretionary expenditures since other non-discretionary expenditures, such as mandatory debt service requirements, are not deducted from the measure. The amount of mandatory versus discretionary expenditures can vary significantly between periods. The Company believes that net income before certain items, the effective tax rate before certain items, income before certain items per diluted share, and information excluding the impact of currency translation are useful in evaluating the Company's operations. Segment income, free cash flow, the effective tax rate before certain items, net income before certain items, income before certain items per diluted share and information excluding the impact of currency translation 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, the effective tax rate before certain items, net income before certain items, income before certain items per diluted share and information unadjusted for currency translation can be found within this release.

Conference Call
The Company will hold a conference call tomorrow, October 20, 2015 at 9:00 a.m. (EDT) to discuss this news release. Forward-looking and other material information may be discussed on the conference call. The dial-in numbers for the conference call are (517) 308-9237 or toll-free (888) 469-0976 and the access password is 'packaging.' A live webcast of the call will be made available to the public on the internet at the Company's web site, www.crowncork.com. A replay of the conference call will be available for a one-week period ending at midnight on October 27. The telephone numbers for the replay are (203) 369-3131 or toll free (800) 688-3991.

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 future impact of currency translation, future demand for beverage cans, including in the U.S., Southern and Eastern Europe and Southeast Asia, weather and its impact on the Company, the continued successful integration of Mivisa and Empaque, and the Company's ability to increase profits in the European Food segment and to successfully implement restructuring projects that may cause actual results to be materially different from those expressed or implied in the forward-looking statements. Important factors that could cause the statements made in this press release or the actual results of operations or financial condition of the Company to differ are discussed under the caption 'Forward Looking Statements' in the Company's Form 10-K Annual Report for the year ended December 31, 2014 and in subsequent filings made prior to or after the date hereof. The Company does not intend to review or revise any particular forward-looking statement in light of future events.

Crown Holdings, Inc., through its subsidiaries, is a leading supplier of packaging products to consumer marketing companies around the world. World headquarters are located in Philadelphia, Pennsylvania.

For more information, contact:

Thomas A. Kelly, Senior Vice President and Chief Financial Officer, (215) 698-5341

Thomas T. Fischer, Vice President, Investor Relations and Corporate Affairs, (215) 552-3720

Ed Bisno, Bisno Communications, (212) 717-7578

Unaudited Consolidated Statements of Operations, Balance Sheets, Statements of Cash Flows, Segment Information and Supplemental Data follow.

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 excluding the impact of fair value adjustments to inventory acquired in an acquisition and the timing impact of hedge ineffectiveness, less selling and administrative expense.

Consolidated Supplemental Data (Unaudited)
 (in millions, except per share data)

Reconciliation from Net Income and Income Per Diluted Common Share to Net Income before Certain Items and Income Per Diluted Common Share before Certain Items

The following table reconciles reported net income and diluted earnings per share attributable to the Company to net income before certain items and income per diluted common share before certain items, as used elsewhere in this release.

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SOURCE Crown Holdings, Inc.

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