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Crown Holdings Beats Concensus Estimates

An increased demand for canned foods helped boost the packaging company's net income in the first quarter.

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On April 15, 2009,

Crown Holdings


reported that its Q1 FY09 net income grew 48.1% on the back of increased demand for canned food, as consumers curb their 'out of home' eating amid the global economic slowdown. Net income advanced to $40.00 million, or $0.25 per share, from $27.00 million, or $0.17 per share, in Q1 FY08. Excluding a net charge of $5.00 million, or $0.03 per share, related to the closure of its non-consolidated PET plastic bottle joint-venture in Brazil, the company earned $0.28 per share, which beat the most recent consensus estimate of $0.22 per share.

Total revenue fell 9.6% to $1.68 billion from $1.86 billion in Q1 FY08, primarily due to a double-digit drop in revenue across the European food and European specialty packaging segments. In addition, a $189.00 million negative impact from foreign currency translations also contributed to the fall in revenue during Q1 FY09. Moreover, the company generated 71.0% of net sales outside U.S., as compared to 74.0% in the same quarter of the last year. Looking at its segments, American beverage revenue slipped 5.5% to $409.00 million from $433.00 million, while the North American food segment's revenue increased 6.5% to $197.00 million from $185.00 million in Q1 FY08. On the other hand, revenue from the European beverage segment stood at $339.00 million, down 2.6% from $348.00 million a year ago. Moreover, revenue from the European food and European specialty packaging segment shrunk 20.3% and 22.9% to $389.00 million and $81.00 million, respectively.

During the quarter under review, one of the company's business units, Crown Specialty Packaging, unveiled its two distinctive metal packaging collections designed specifically for the confectionery, biscuit, and promotional markets at ProSweets Cologne. Additionally, CCK appointed Timothy J. Donahue as the new executive vice-president and CFO.