Crown Holdings, Inc. (CCK - Free Report) reported second-quarter 2013 adjusted earnings of 96 cents per share, up 14% from 84 cents earned in the year-ago quarter. The results beat the Zacks Consensus Estimate of 93 cents. Including restructuring charges, earnings per share in the reported quarter stood at 93 cents, up 4% from 89 cents in the year-ago quarter.
Net sales rose 1.8% year over year to $2.22 billion. The year-over-year rise is mainly attributed to increase in global beverage and food can unit, partly offset by the pass-through of soaring raw material costs. Global beverage can volume was up 3% in the second-quarter. The results, however, missed the Zacks Consensus Estimate of $2.29 billion.
Cost of products sold increased 1% to $1.82 billion in the quarter. Gross profit surged 10% to $375 million. Gross margin expanded 130 basis points to 16.9% in the quarter. Selling, general and administrative expenses inched up 13% to $102 million. Adjusted operating income jumped 9% to $273 million. Operating margin increased 80 basis points to 12% in the quarter.
Net sales from Americas Beverage segment amounted to $582 million, down 1.8% year over year. However, segment operating profit rose 8.9% to $85 million from $78 million in the year ago quarter.
North America Food segment reported revenues of $206 million in the quarter compared with $213 million in the year-ago quarter. Operating earnings in the reported quarter were $41 million, flat compared to the prior year quarter.
European Beverage segment sales went up 4% to $492 million in the second quarter. Consequently, operating income shot up 22% year over year to $78 million.
In the European Food segment, sales decreased 1% to $430 million. Segment operating income also declined 17% year over year to $39 million.
Revenues in the Asia Pacific segment increased 21% over year to $301 million in the reported quarter. However, operating profit for the segment remained flat at $35 million from the year-ago quarter.
As of Jun 30, 2013, Crown had cash and cash equivalents of $227 million, down from $230 million as of Jun 30, 2012. Total debt of the company increased to $3.8 billion as of Jun 30, 2013 from $3.6 billion as of Jun 30, 2012.
Total cash flow used in operating activities was $251 million for the first half of fiscal 2013, compared with $216 million in the comparable period last year. Free cash flow in the reported quarter was $120 million compared with $96 million in the prior-year quarter. During the quarter, Crown repurchased 4.4 million shares for $188 million.
Crown aimed to expand the beverage cans volume worldwide, especially in the growth markets. During the second quarter, the company began commercial production at its new beverage can plants in Danang, Vietnam and Bangkok, Thailand. The company also started production in Sihanoukville, Cambodia plant last week. Management expects Crown will be benefited from these beverage can capacity expansions.
Philadelphia, Pa.-based, Crown is a leading supplier of packaging products to consumer marketing companies. The company manufactures aluminum beverage cans, food cans, aerosol cans and other packaging products.
Mobile Mini, Inc. (MINI - Free Report) also belong to the same industry where Crown operates holding a Zacks Rank #1 (Strong Buy). Crown’s peers such as EveryWare Global, Inc. and Ball Corporation (BLL - Free Report) are yet to announce their quarterly results.
Crown currently retains a Zacks Rank #4 (Sell).