Crown Holdings, Inc. Q3 2008 Earnings Call Transcript

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2008-10-16 11:08:15.0

Tags: Food, Europe, Beverage, Call Transcript, Region, Earnings, Crown Holdings Inc., Food & Beverage, Manufacturing, Seeking Alpha, Food, Europe, Beverage, Call Transcript, Region, Earnings, Crown Holdings Inc., Food & Beverage, Manufacturing, Seeking Alpha

Question-and-Answer Session

Operator

We will now begin the question and answer session. (Operator Instructions) Our first question comes from Timothy Thein with Citigroup.

Timothy Thein - Citigroup

Two quick questions here; one, if you can just maybe give a little bit commentary around the European beverage can segment, maybe you gave the volumes I think for the segment as a whole, maybe if you could split that, maybe by region, west, east in Europe and then Middle East, and then secondly; on the aerosol business you had nice growth in non-reportable, Can you may be give a little bit more commentary there in terms of the breakdown between the Asian business and then aerosols, specifically looking at the volumes that you saw in the aerosol business in the third quarter.

John W. Conway

Well, the non-reportable, Tim; obviously we reported this way because that’s how it’s being laid out. Beverage cans did very well in Asia as I said and the aerosol business, the volumes are a little better, but it really was that we have some better pricing.

Alan W. Rutherford

Tim, I think your question with regard to European beverage cans, we don’t have a break out by region, but I can generally say that Western Europe relative to the Middle East, North Africa, the Eastern Mediterranean was somewhat weaker and those regions were a fair bit stronger, but the entire region is up nicely.

Operator

Our next question comes from Alton Stump with Longbow Research.

Alton Stump - Longbow Research

I think you mentioned some comments on food can pricing heading into ’09 with some pretty hefty, it looks like cost pass-throughs coming; just wanted to get an idea of whether you think that the market will be rational in Europe, not just for yourselves, but also like your major competitor in that region next year?

Alan W. Rutherford

Yes, we think so. From what we can tell on both sides of the Atlantic, our European and North American food can businesses are facing very very significant tinplate price increases, and we think that that’s true of our competitors and of ourselves and we think it’s quite uniform. We think, as you will recall, the tinplate steel industry in Europe and North America is extremely consolidated; only two large tinplates suppliers in North America and three in Western Europe, all of them have been facing significant cost increases of their own; so, we are going to have to aggressively put up our prices for food and aerosol and metal vacuum closures, and we are out to our customers already telling them about that, we think prices have largely settled for tinplate steel on both sides of the Atlantic, so we’ve got real good visibility on what we’re going to have to do, and we have announced this to our customers, they understand it, the price increases are going to be effective January 1, and we’re just not in a position to make any exceptions given the size of the increases.

 

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