Closures

Net sales of the closures business were $183.1 million in the second quarter of 2012, a decrease of $1.4 million, or 0.8 percent, as compared to $184.5 million in 2011. This decrease was primarily the result of the impact of unfavorable foreign currency translation of approximately $9.3 million and lower net sales in Europe due to weak market conditions, partially offset by favorable unit volumes in the U.S. single-serve beverage market.

Income from operations of the closures business for the second quarter of 2012 increased $0.2 million to $22.9 million as compared to $22.7 million in 2011, and operating margin increased to 12.5 percent from 12.3 percent over the same periods. These increases were primarily attributable to higher unit volumes in the U.S. single-serve beverage market, continued improvement in manufacturing efficiencies and operating cost savings and a decrease in rationalization charges, largely offset by weaker volumes and increased price pressure in the European market due to macroeconomic issues.

Plastic Containers

Net sales of the plastic container business were $158.8 million in the second quarter of 2012, an increase of $3.4 million, or 2.2 percent, as compared to $155.4 million in 2011. This increase was principally a result of a favorable mix of products sold and an increase in unit volumes, both due primarily to strong seasonal sales in the agricultural and chemical markets and customers building inventory in advance of planned shut downs. This increase was partially offset by the unfavorable impact of foreign currency translation of approximately $1.6 million.

Income from operations of the plastic container business for the second quarter of 2012 was $9.1 million, an increase of $4.6 million as compared to $4.5 million in 2011, and operating margin increased to 5.7 percent from 2.9 percent over the same periods. These increases were primarily attributable to the favorable comparison of the year-over-year resin pass through lag effect which benefited the second quarter of 2012, a favorable mix of products sold, cost reduction initiatives and continued improvement in operating performance, an increase in unit volumes and lower rationalization charges.

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