Quick10K

Silgan Holdings

Price	29.77		EPS	2
Shares	112		P/E	17
MCap	3,321		P/FCF	-1,377
Net Debt	2,534		EBIT	301
TEV	5,855		TEV/EBIT	19
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-09-30	Filed 2020-11-06 Print
10-Q	2020-06-30	Filed 2020-08-07 Print
10-Q	2020-03-31	Filed 2020-05-08 Print
10-K	2019-12-31	Filed 2020-03-02 Print
10-Q	2019-09-30	Filed 2019-11-08 Print
10-Q	2019-06-30	Filed 2019-08-08 Print
10-Q	2019-03-31	Filed 2019-05-08 Print
10-K	2018-12-31	Filed 2019-02-28 Print
10-Q	2018-09-30	Filed 2018-11-08 Print
10-Q	2018-06-30	Filed 2018-08-08 Print
10-Q	2018-03-31	Filed 2018-05-04 Print
10-K	2017-12-31	Filed 2018-03-01 Print
10-Q	2017-09-30	Filed 2017-11-09 Print
10-Q	2017-06-30	Filed 2017-08-09 Print
10-Q	2017-03-31	Filed 2017-05-05 Print
10-K	2016-12-31	Filed 2017-03-01 Print
10-Q	2016-09-30	Filed 2016-11-08 Print
10-Q	2016-06-30	Filed 2016-08-03 Print
10-Q	2016-03-31	Filed 2016-05-06 Print
10-K	2015-12-31	Filed 2016-02-25 Print
10-Q	2015-09-30	Filed 2015-11-06 Print
10-Q	2015-06-30	Filed 2015-08-07 Print
10-Q	2015-03-31	Filed 2015-05-08 Print
10-K	2014-12-31	Filed 2015-02-27 Print
10-Q	2014-09-30	Filed 2014-11-07 Print
10-Q	2014-06-30	Filed 2014-08-08 Print
10-Q	2014-03-31	Filed 2014-05-09 Print
10-K	2013-12-31	Filed 2014-02-28 Print
10-Q	2013-09-30	Filed 2013-11-08 Print
10-Q	2013-06-30	Filed 2013-08-08 Print
10-Q	2013-03-31	Filed 2013-05-10 Print
10-K	2012-12-31	Filed 2013-02-28 Print
10-Q	2012-09-30	Filed 2012-11-09 Print
10-Q	2012-06-30	Filed 2012-08-09 Print
10-Q	2012-03-31	Filed 2012-05-10 Print
10-K	2011-12-31	Filed 2012-02-29 Print
10-Q	2011-09-30	Filed 2011-11-09 Print
10-Q	2011-06-30	Filed 2011-08-09 Print
10-Q	2011-03-31	Filed 2011-05-10 Print
10-K	2010-12-31	Filed 2011-02-28 Print
10-Q	2010-09-30	Filed 2010-11-05 Print
10-Q	2010-08-02	Filed 2010-08-09 Print
10-Q	2010-03-31	Filed 2010-05-10 Print
10-K	2009-12-31	Filed 2010-03-01 Print

8-K	2020-11-04
8-K	2020-10-21
8-K	2020-08-05
8-K	2020-07-22
8-K	2020-07-15
8-K	2020-06-08
8-K	2020-06-01
8-K	2020-05-06
8-K	2020-04-22
8-K	2020-04-21
8-K	2020-04-17
8-K	2020-02-27
8-K	2020-02-26
8-K	2020-02-19
8-K	2020-02-19
8-K	2020-02-04
8-K	2020-01-28
8-K	2020-01-27
8-K	2020-01-27
8-K	2019-11-12
8-K	2019-11-06
8-K	2019-11-04
8-K	2019-11-04
8-K	2019-10-23
8-K	2019-10-01
8-K	2019-08-07
8-K	2019-07-24
8-K	2019-07-01
8-K	2019-07-01
8-K	2019-06-12
8-K	2019-06-11
8-K	2019-06-04
8-K	2019-05-08
8-K	2019-05-07
8-K	2019-04-24
8-K	2019-04-15
8-K	2019-04-01
8-K	2019-02-27
8-K	2019-01-29
8-K	2018-11-08
8-K	2018-10-24
8-K	2018-08-07
8-K	2018-08-06
8-K	2018-07-25
8-K	2018-06-11
8-K	2018-05-30
8-K	2018-05-03
8-K	2018-04-25
8-K	2018-03-16
8-K	2018-02-28
8-K	2018-01-30
8-K	2018-01-24

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Balance Sheet	Income Statement	Cash Flow
CopyHistoryView Assets, Equity	CopyHistoryView Rev, G Profit, Net Income	CopyHistoryView Ops, Inv, Fin

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Part I. Financial Information

Item 1. Financial Statements

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Note 1.               Significant Accounting Policies

Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Silgan Holdings Inc., or Silgan, have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  In the opinion of management, the accompanying financial statements include all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation.  The results of operations for any interim period are not necessarily indicative of the results of operations for the full year.

The Condensed Consolidated Balance Sheet at December 31, 2019 has been derived from our audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements.

You should read the accompanying condensed consolidated financial statements in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.

Goodwill and Other Intangible Assets. We review goodwill and other indefinite-lived intangible assets for impairment as of July 1 of each year and more frequently if circumstances indicate a possible impairment. We determined that our goodwill and other indefinite-lived intangible assets were not impaired in our annual 2020 assessment performed during the third quarter.

Recently Adopted Accounting Pronouncements. In June 2016, the Financial Accounting Standards Board, or FASB, issued an accounting standards update, or ASU, that amends the guidance on the accounting for credit losses on financial instruments. This new standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables. We adopted this new standard on January 1, 2020 using the transition method, which allowed us to recognize the effects of applying this standard as a cumulative effect to retained earnings as of January 1, 2020. As a result of the adoption of this standard, we reduced retained earnings by $0.7 million. The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

Note 2.               Revenue

The following tables present our revenues disaggregated by reportable business segment and geography as they best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenues by business segment were as follows:

Copy History

			Three Months Ended												Nine Months Ended
			Sept. 30, 2020						Sept. 30, 2019						Sept. 30, 2020						Sept. 30, 2019
			(Dollars in thousands)
Metal containers			$	856,660					$	822,262					$	1,962,370					$	1,904,941
Closures			475,105						353,436						1,242,725						1,072,979
Plastic containers			156,734						145,644						490,258						463,715
			$	1,488,499					$	1,321,342					$	3,695,353					$	3,441,635

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Revenues by geography were as follows:

Copy History

			Three Months Ended												Nine Months Ended
			Sept. 30, 2020						Sept. 30, 2019						Sept. 30, 2020						Sept. 30, 2019
			(Dollars in thousands)
North America			$	1,143,562					$	1,078,187					$	2,858,561					$	2,747,518
Europe and other			344,937						243,155						836,792						694,117
			$	1,488,499					$	1,321,342					$	3,695,353					$	3,441,635

Note 3.               Acquisitions

Cobra Plastics Acquisition

On February 4, 2020 we acquired Cobra Plastics, Inc., or Cobra Plastics, a manufacturer and seller of injection molded plastic closures for a wide variety of consumer products, with a particular focus on the aerosol overcap market. The purchase price for this acquisition of $39.8 million, net of cash acquired, was primarily funded with revolving loan borrowings under our amended and restated senior secured credit facility, or the Credit Agreement. For this acquisition, we applied the acquisition method of accounting and recognized assets acquired and liabilities assumed at fair value as of the acquisition date, and we recognized goodwill of $18.4 million and a customer relationship intangible asset of $11.5 million. Cobra Plastics' results of operations were included in our closures business since the acquisition date and were not significant since such date.

Albéa Dispensing Business Acquisition

On June 1, 2020, we acquired the dispensing operations of the Albéa Group, or the Albéa Dispensing Business, a leading global supplier of highly engineered pumps, sprayers and foam dispensing solutions to major branded consumer goods product companies in the beauty and personal care markets. It operates a global network of ten manufacturing facilities across North America, Europe, South America and Asia. This acquisition is strategically important for us, as it expands our closures franchise and, in particular, our dispensing systems operations. The Albéa Dispensing Business is included in our closures business as of the acquisition date.

We acquired the Albéa Dispensing Business for a purchase price in cash of $901.0 million, net of cash acquired. The purchase price is subject to adjustment for working capital, other current assets and current liabilities and net indebtedness. We incurred acquisition related costs for the Albéa Dispensing Business totaling $0.7 million and $19.0 million for the three and nine months ended September 30, 2020, respectively, which are included in selling, general and administrative expenses in our Condensed Consolidated Statements of Income. We funded the purchase price for this acquisition with term and revolving loan borrowings under the Credit Agreement, including a delayed draw term loan of $900 million. See Note 8 for further information.

The initial purchase price has been allocated to assets acquired and liabilities assumed based on estimated fair values at the date of acquisition using valuation techniques including the income, cost and market approaches, primarily using Level 3 inputs (as defined in Note 9). The purchase price allocation is preliminary and subject to change pending a final valuation of the assets and liabilities, including property, plant and equipment and intangible assets, and the related tax impact of any adjustments to

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such valuations. In connection with this acquisition, we recorded a charge of $3.5 million related to the write-up of acquired inventory of the Albéa Dispensing Business as a result of purchase accounting.

The allocated fair value of assets acquired and liabilities assumed are summarized as follows (in thousands)

Copy History

Trade accounts receivable			$	42,742
Inventories			41,102
Property, plant and equipment			192,723
Other intangible assets			285,000
Other assets			33,478
Trade accounts payable and accrued liabilities			(62,930)
Deferred income tax liabilities			(101,795)
Debt and other liabilities			(31,843)
Total identifiable net assets			398,477
Goodwill			502,570
Cash paid at closing, net of cash acquired			$	901,047

Goodwill of $502.6 million consists largely of our increased capacity to serve our global customers and achieve operational synergies and has been assigned to our closures segment. A majority of the goodwill is not expected to be deductible for income tax purposes. Other intangible assets consist of customer relationships of $257.0 million with an estimated remaining life of 24 years and technology know-how of $28.0 million with an estimated remaining life of 8 years. Acquired property, plant and equipment are being depreciated on a straight-line basis with estimated remaining lives of up to 35 years.

Note 4.               Rationalization Charges

We continually evaluate cost reduction opportunities across each of our businesses, including rationalizations of our existing facilities through plant closings and downsizings. We use a disciplined approach to identify opportunities that generate attractive cash returns. Rationalization charges by business segment were as follows:

Copy History

						Three Months Ended												Nine Months Ended
						Sept. 30, 2020						Sept. 30, 2019						Sept. 30, 2020						Sept. 30, 2019
						(Dollars in thousands)
Metal containers						$	1,639					$	3,035					$	4,755					$	42,280
Closures						787						72						2,229						5,979
Plastic containers						79						88						263						335
						$	2,505					$	3,195					$	7,247					$	48,594

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Activity in reserves for our rationalization plans were as follows:

Copy History

						Employee Severance and Benefits						Plant Exit Costs						Non-Cash Asset Write-Down						Total
						(Dollars in thousands)
Balance at December 31, 2019						$	42,815					$	898					$	—					$	43,713
Charged to expense						4,138						2,005						1,104						7,247
Utilized and currency translation						(5,410)						(2,251)						(1,104)						(8,765)
Balance at September 30, 2020						$	41,543					$	652					$	—					$	42,195

Rationalization reserves as of September 30, 2020 were recorded in our Condensed Consolidated Balance Sheets as accrued liabilities of $4.8 million and other liabilities of $37.4 million. Exclusive of the footprint optimization plan for our metal container business and our resulting withdrawal from the Central States, Southeast and Southwest Areas Pension Plan, or the Central States Pension Plan, announced in 2019, remaining expenses and cash expenditures for our rationalization plans are expected to be $2.1 million and $3.9 million, respectively. Remaining expenses for the accretion of interest for the withdrawal liability related to the Central States Pension Plan are expected to average approximately $1.1 million per year and be recognized annually for the next twenty years, and remaining cash expenditures for the withdrawal liability related to the Central States Pension Plan are expected to be approximately $3.1 million annually for the next twenty years, beginning in 2020.

Note 5.               Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss is reported in our Condensed Consolidated Statements of Stockholders’ Equity.  Amounts included in accumulated other comprehensive loss, net of tax, were as follows:

 

Copy History

			Unrecognized Net Defined Benefit Plan Costs						Change in Fair Value of Derivatives						Foreign Currency Translation						Total
			(Dollars in thousands)
Balance at December 31, 2019			$	(139,102)					$	(3,182)					$	(117,458)					$	(259,742)
Other comprehensive loss before reclassifications			(872)						(3,176)						(15,495)						(19,543)
Amounts reclassified from accumulated other     comprehensive loss			5,427						1,506						—						6,933
Other comprehensive loss			4,555						(1,670)						(15,495)						(12,610)
Balance at September 30, 2020			$	(134,547)					$	(4,852)					$	(132,953)					$	(272,352)

 

The amounts reclassified to earnings from the unrecognized net defined benefit plan costs component of accumulated other comprehensive loss for the three and nine months ended September 30, 2020, were net (losses) of $(2.4) million and $(7.3) million, respectively, excluding income tax benefits of $0.6 million and $1.9 million, respectively. For the three and nine months ended September 30, 2020 these net (losses) consisted of amortization of net actuarial (losses) of $(2.9) million and $(8.6) million and amortization of net prior service credit of $0.4 million and $1.3 million, respectively. Amortization of net actuarial losses and net prior service credit was recorded in other pension and postretirement income in our Condensed Consolidated Statements of Income. See Note 11 for further information.

The amounts reclassified to earnings from the change in fair value of derivatives component of accumulated other comprehensive loss for the three and nine months ended September 30, 2020 were not significant.

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Note 6.               Inventories

Inventories consisted of the following: 

Copy History

			Sept. 30, 2020						Sept. 30, 2019						Dec. 31, 2019
			(Dollars in thousands)
Raw materials			$	294,896					$	275,015					$	286,953
Work-in-process			154,157						127,590						134,417
Finished goods			370,406						413,864						355,337
Other			15,217						12,620						12,793
			834,676						829,089						789,500
Adjustment to value inventory at cost on the LIFO method			(156,495)						(125,883)						(156,495)
			$	678,181					$	703,206					$	633,005

Note 7.               Goodwill and Other Intangibles

Changes in the carrying amount of goodwill were as follows:

Copy History

			Metal Containers						Closures						Plastic Containers						Total
			(Dollars in thousands)
Balance at December 31, 2019			$	113,463					$	801,776					$	226,984					$	1,142,223
Acquisitions			—						520,946						—						520,946
Currency translation			2,217						37,511						(434)						39,294
Balance at September 30, 2020			$	115,680					$	1,360,233					$	226,550					$	1,702,463

In connection with our acquisitions of Cobra Plastics and the Albéa Dispensing Business as discussed in Note 3, we recognized goodwill of $521.0 million.

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The components of other intangible assets, net were as follows:

Copy History

			Sept. 30, 2020												Dec. 31, 2019
			Gross Amount						Accumulated Amortization						Gross Amount						Accumulated Amortization
			(Dollars in thousands)
Definite-lived intangibles:
Customer relationships			$	696,003					$	(136,583)					$	422,042					$	(116,575)
Other			70,766						(29,070)						39,447						(22,439)
			766,769						(165,653)						461,489						(139,014)
Indefinite-lived intangibles:
Trade names			32,140						—						32,140						—
			$	798,909					$	(165,653)					$	493,629					$	(139,014)

In connection with our acquisitions of Cobra Plastics and the Albéa Dispensing Business as discussed in Note 3, we recognized intangible assets for customer relationships of $268.5 million and technology know-how of $28.0 million.

Note 8.               Long-Term Debt

Long-term debt consisted of the following: 

Copy History

			Sept. 30, 2020						Sept. 30, 2019						Dec. 31, 2019
			(Dollars in thousands)
Bank debt
Bank revolving loans			$	246,000					$	766,000					$	—
U.S. term loans			900,000						800,000						760,000
Canadian term loans			—						15,943						4,703
Other foreign bank revolving and term loans			39,825						37,062						31,127
Total bank debt			1,185,825						1,619,005						795,830
4¾% Senior Notes			300,000						300,000						300,000
3¼% Senior Notes			762,223						708,630						729,755
4⅛% Senior Notes