Crown Holdings, Inc. Q2 2009 Earnings Call Transcript

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2009-07-16 11:28:15.0

Tags: J.P. Morgan Chase & Co., Beverage, Call Transcript, Western Europe, Quarter, Earnings, Crown Holdings Inc., Food & Beverage, Manufacturing, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Joseph Naya - UBS.

Joseph Naya - UBS

Your volumes over the past year or so have benefited from some improvements in private label market share. I know there's been some concern that we could see a little bit of a reversal there if we see increased promotion from some of the branded [soft drinks]. I was just curious maybe how concerned you are about that and how you're positioning the portfolio going forward?

John W. Conway

Really, we're not concerned at all. It is true private label's been a little stronger in the first six months this year than it was last year, but we don't anticipate that that's going to change over the foreseeable future.

And then the other thing to remember is we've got a very strong branded soft drinks business now as well. There's been a rotation in terms of the customers that we're now currently focused on, but the customers we're focused on are doing very, very well, the branded customers, in North America.

So we're calm and cool and collected about that subject and we think we're going to do fine.

Operator

Your next question comes from Claudia Hueston - J.P. Morgan.

Claudia Hueston - J.P. Morgan

I was hoping you could provide just a little bit more color on beverage can volume trends in Europe and what you say maybe by region within Europe?

John W. Conway

Well, certainly we saw an improvement in Western Europe in the second quarter compared to the first quarter. In fact, where we and the industry were down in Western Europe in the first quarter, both were up in the second quarter. I think our Western European volumes were up about just over 1% in the quarter.

We don't have, as you know, any current weighting to Eastern Europe or Russia, so we're not impacted by the softness in that market, but in terms of Western Europe we're doing quite well.

And in the Middle East, as you know, that market has been growing tremendously over the last four to five years, on the order of 20% per year. Growth was much slower in the second quarter this year, still growing somewhat but albeit at lower rates, kind of plateauing and taking a breather for the time being.

Claudia Hueston - J.P. Morgan

And then, if I heard right, it sounds like CapEx is going to be a little higher and it was actually lower than I thought in the quarter, if you just could provide some color on that.

 

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