We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Silgan Holdings Inc. (SLGN - Free Report) reported first-quarter 2017 adjusted earnings of 62 cents, up around 38% year over year. Earnings surpassed the Zacks Consensus Estimate as well as the management’s guidance range of 48–58 cents.
Including rationalization charges, the company’s earnings per share came in at 42 cents, down from 44 cents recorded in the prior-year quarter.
Total revenue increased 1.6% year over year to $805.4 million, beating the Zacks Consensus Estimate of $794 million. This growth was primarily driven by an increase in net sales in the metal container business.
Silgan Holdings Inc. Price, Consensus and EPS Surprise
Cost of goods sold increased 9.4% to $680.8 million from $678.8 million in the year-ago quarter. Gross profit rose 3% to $124.6 million. Gross margin expanded 110 basis points (bps) year over year to 15.5%.
Selling, general and administrative expenses went up 20.8% year over year to $66.9 million. Adjusted operating income edged down 1.4% to $57.7 million. Operating margin contracted 20 bps year over year to 7.2%.
Segment Performance
Revenues at the Metal Containers segment climbed 2.8% year over year to $466 million. The segment’s adjusted operating income improved 18.6% to $44.6 million.
The Closures segment’s revenues inched up 0.8% year over year to $197.7 million. Adjusted operating income declined 2.8% to $24 million.
At the Plastic Containers segment, revenues dropped 1.2% year over year to $141.5 million. The segment reported an adjusted profit of $6.9 million, surging significantly from $1.1 million in the prior-year quarter.
Financial Updates
Silgan had cash and cash equivalents of $350.6 million at the end of first-quarter 2017 compared with $24.7 million at the end of 2016. The company recorded cash used for operating activities of $140.9 million in the reported quarter compared with cash usage of $150.8 million recorded in the year-ago quarter.
Last month, Silgan acquired WestRock Company’s (WRK - Free Report) dispensing systems business for $1.025 billion. The buyout will help in boosting the scope and breadth of Silgan’s market leading Closure business.
Guidance
Silgan raised its estimate of adjusted earnings per share guidance for full-year 2017, which excludes transaction related costs attributed to announced acquisitions, rationalization charges and loss from early extinguishment of debt, to the range of $3.20–$3.40 from the previous range of $3.15–$3.35. This estimate includes the favorable impact from the recently acquired Dispensing Systems business, net of related purchase accounting adjustments, partially offset by the impact from higher average interest rates primarily as a result of the issuance of new senior notes in first-quarter 2017.
For the second quarter, the company anticipates earnings per share in the range of 65–75 cents.
Share Price Performance
Over the last one year, Silgan outperformed the Zacks classified Containers-Metal/Glass sub-industry with respect to price performance. The stock gained around 18.2%, while the industry recorded growth of 12.6% over the same time frame.
Applied Industrial Technologies has an average positive earnings surprise of 9.78% for the trailing four quarters. Casella Waste generated an impressive average positive earnings surprise of 165.21% over the past four quarters.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Silgan (SLGN) Tops Q1 Earnings, Revenues, Lifts '17 EPS View
Silgan Holdings Inc. (SLGN - Free Report) reported first-quarter 2017 adjusted earnings of 62 cents, up around 38% year over year. Earnings surpassed the Zacks Consensus Estimate as well as the management’s guidance range of 48–58 cents.
Including rationalization charges, the company’s earnings per share came in at 42 cents, down from 44 cents recorded in the prior-year quarter.
Total revenue increased 1.6% year over year to $805.4 million, beating the Zacks Consensus Estimate of $794 million. This growth was primarily driven by an increase in net sales in the metal container business.
Silgan Holdings Inc. Price, Consensus and EPS Surprise
Silgan Holdings Inc. Price, Consensus and EPS Surprise | Silgan Holdings Inc. Quote
Cost and Margins
Cost of goods sold increased 9.4% to $680.8 million from $678.8 million in the year-ago quarter. Gross profit rose 3% to $124.6 million. Gross margin expanded 110 basis points (bps) year over year to 15.5%.
Selling, general and administrative expenses went up 20.8% year over year to $66.9 million. Adjusted operating income edged down 1.4% to $57.7 million. Operating margin contracted 20 bps year over year to 7.2%.
Segment Performance
Revenues at the Metal Containers segment climbed 2.8% year over year to $466 million. The segment’s adjusted operating income improved 18.6% to $44.6 million.
The Closures segment’s revenues inched up 0.8% year over year to $197.7 million. Adjusted operating income declined 2.8% to $24 million.
At the Plastic Containers segment, revenues dropped 1.2% year over year to $141.5 million. The segment reported an adjusted profit of $6.9 million, surging significantly from $1.1 million in the prior-year quarter.
Financial Updates
Silgan had cash and cash equivalents of $350.6 million at the end of first-quarter 2017 compared with $24.7 million at the end of 2016. The company recorded cash used for operating activities of $140.9 million in the reported quarter compared with cash usage of $150.8 million recorded in the year-ago quarter.
Last month, Silgan acquired WestRock Company’s (WRK - Free Report) dispensing systems business for $1.025 billion. The buyout will help in boosting the scope and breadth of Silgan’s market leading Closure business.
Guidance
Silgan raised its estimate of adjusted earnings per share guidance for full-year 2017, which excludes transaction related costs attributed to announced acquisitions, rationalization charges and loss from early extinguishment of debt, to the range of $3.20–$3.40 from the previous range of $3.15–$3.35. This estimate includes the favorable impact from the recently acquired Dispensing Systems business, net of related purchase accounting adjustments, partially offset by the impact from higher average interest rates primarily as a result of the issuance of new senior notes in first-quarter 2017.
For the second quarter, the company anticipates earnings per share in the range of 65–75 cents.
Share Price Performance
Over the last one year, Silgan outperformed the Zacks classified Containers-Metal/Glass sub-industry with respect to price performance. The stock gained around 18.2%, while the industry recorded growth of 12.6% over the same time frame.
Zacks Rank & Other Stocks to Consider
Silgan currently carries a Zacks Rank #2 (Buy).
Other stocks worth considering in the same sector are Applied Industrial Technologies, Inc. (AIT - Free Report) and Casella Waste Systems, Inc. (CWST - Free Report) . Both the stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Applied Industrial Technologies has an average positive earnings surprise of 9.78% for the trailing four quarters. Casella Waste generated an impressive average positive earnings surprise of 165.21% over the past four quarters.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>