Crown Holdings Reports 3Q 2023 Results

Crown Holdings, Inc. announced its financial results for the third quarter ended Sept. 30, 2023.

Net sales in the third quarter were $3,069 million compared to $3,259 million in the third quarter of 2022, reflecting higher beverage can volumes in North America and favorable foreign currency translation of $60 million, offset by lower volumes across most other businesses and the pass through of $187 million in lower material costs.

Income from operations was $374 million in the third quarter compared to $297 million in the third quarter of 2022. Segment income in the third quarter of 2023 was $430 million compared to $336 million in the prior year third quarter reflecting the benefits from higher beverage can volumes in North America, the contractual recovery of prior years’ inflationary cost increases in Europe and the successful implementation of cost reduction programs in Transit Packaging.

“Operating results for the third quarter were solid, and the company performed in line with expectations despite the cumulative effects of persistent inflation and challenging macroeconomic conditions in certain markets, such as Asia, which continue to adversely impact volumes. Beverage can volumes in North America expanded by 13% and the can continues to be the preferred choice by both customers and consumers alike for new beverage product introductions,” said Timothy J. Donahue, chairman, president and CEO.

“The benefits of the overhead cost reduction program were clearly visible in strong Transit Packaging results for the quarter, more than offsetting generally sluggish volumes resulting from lackluster production in several industrial markets,” added Donahue. “Actions taken in 2022 to negotiate more comprehensive raw material and other inflationary pass-through provisions resulted in improved income performance in the European Beverage division. Beverage can volumes in Asia Pacific and aerosol can shipments in North America continued to be weak during the quarter.

“Looking forward, we remain focused on customer satisfaction and executing that which is under our control. We have adjusted production schedules to reduce inventory levels across aerosols, Asia and Transit in response to current demand. Net leverage at 3.5 times is one-half turn lower than only three months ago and we remain on pace to generate approximately $500 million in free cash flow. We anticipate that capital expenditures will be significantly reduced to approximately $500 million in each 2024 and 2025, and the company expects to use the increased cash flow to pay down debt and return capital to shareholders.”

Nine Month Results

Net sales for the first nine months of 2023 were $9,152 million compared to $9,931 million in the first nine months of 2022, primarily due to 6% higher beverage can volumes in North America and favorable foreign currency translation of $35 million, offset by the pass through of $575 million in lower material costs and lower overall net volumes.

Income from operations was $1,010 million in the first nine months of 2023 compared to $1,107 million in the first nine months of 2022, which included a gain of $113 million for the sale of the Transit Packaging segment’s Kiwiplan business.

Segment income in the first nine months of 2023 was $1,164 million versus $1,151 million in the prior year period, reflecting benefits from higher beverage can volumes in Americas Beverage, the contractual recovery of prior year’s inflationary cost increases in European Beverage and cost reduction initiatives in Transit Packaging, partially offset by $60 million of year over year inventory impact of steel repricing in the Other segment and lower volumes in most other businesses, notably in aerosols in North America and beverage cans in Asia.

“The company completed the acquisition of Helvetia Packaging in early October, and we welcome our new associates to the Crown family,” Donahue concluded.