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Silgan Holdings' CEO Discusses Q2 2012 Results - Earnings Call Transcript

In addition, we incurred a $38.7 million loss from the early extinguishment of debt as a result of the make-whole provision of the 7.25 notes, which were retired with the proceeds from the 5% note issuance. I’ll also point out that the loss on early extinguishment of debt had a bearing on our effective tax rate for the quarter as the $1.7 million cumulative rate adjustments in certain foreign jurisdictions were applied to a much lower taxable base as a consequence of this loss.

Capital expenditures for the second quarter of 2012 totaled $33.1 million, compared to $50.7 million in the prior year quarter. On a year-to-date basis, capital expenditures totaled $59.5 million in 2012, versus $84.2 million in the prior year. And we do continue to anticipate capital spending for the full year to be in the lower end of our range of $125 million to $150 million as we compressed capital in 2011 to take advantage of the accelerated tax deductions.

Additionally, we paid a quarterly dividend of $0.12 per share, in June with a total cash cost of $8.5 million, and also during the quarter, we repurchased approximately 397,000 shares for an aggregate amount of $17.1 million through a series of open market transactions.

I’ll now provide some specifics regarding to the individual businesses. The metal container business recorded net sales of $479.7 million for the second quarter of 2012, a decrease of $2.6 million versus the prior year quarter. And this decrease was primarily due to unfavorable foreign currency translation of approximately $7.5 million and a less favorable mix of products sold partially offset by higher average selling prices as a result of the pass through of higher raw material costs. Unit volumes were up slightly for the quarter as incremental units from the Nestlé Purina steel can operations were largely offset by volume declined attributable to a slower start for the vegetable pack and general softness in European volumes, particularly in general line.

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