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Crown Holdings (CCK) Q4 Earnings & Revenues Beat Estimates

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Crown Holdings, Inc. (CCK - Free Report) reported fourth-quarter 2019 adjusted earnings per share of $1.04, which surpassed the Zacks Consensus Estimate of 95 cents. The bottom line also improved 4% year over year and came in higher than management’s guidance of 93-98 cents.

Including one-time items, earnings per share improved 60% year over year to 64 cents in the reported quarter.

Net sales in the quarter came in at $2,791 million, up from the year-ago quarter’s $2,734 million. The reported figure also outpaced the Zacks Consensus Estimate of $2,712 million.

Crown Holdings, Inc. Price, Consensus and EPS Surprise

Cost and Margins

Cost of products sold was up 2% year over year to $2,267 million. On a year-over-year basis, gross profit rose 3% to $524 million. Gross margin expanded to 18.8% from the year-ago quarter’s 18.7%.

Selling and administrative expenses were up 3% year over year to $124 million. Segment operating income increased 2% year over year to $285 million during the fourth quarter. Operating margin came in at 10.2%, flat year over year.

Segment Performance

Net sales in the Americas Beverage segment came in at $856 million, up 6.5% from the prior-year quarter’s tally of $804 million. Segment operating profit improved 25% year over year to $148 million.

The European Beverage segment’s sales went up 12.5% year over year to $332 million. Operating income was up 108% year over year to $27 million.

Revenues in the European Food segment fell 4% year over year to $400 million. Segment operating profit declined 39% year over year to $16 million.

The Asia-Pacific segment’s revenues inched up 1.5% year over year to $331 million. Operating profit improved to $51 million from prior-year quarter figure of $49 million.

Revenues in the Transit Packaging segment totaled $549 million compared with $595 million recorded in the year-ago period. Operating profit declined 21% year over year to $63 million.

Financial Update

Crown Holdings had cash and cash equivalents of $607 million at the end of 2019, flat compared with 2018-end. The company generated $1,163 million of cash from operating activities in 2019 compared with the prior-year figure of $571 million.

As of 2019 end, Crown Holdings’ long-term debt decreased to $7,818 million from $8,517 million as of end of the prior year.

2019 Results

Crown Holdings reported adjusted earnings per share of $5.11 in 2019, down 2% from the prior-year reported figure of $5.20. Earnings beat the Zacks Consensus Estimate of $5.02 and management’s guidance of $5.00-$5.05. Including one-time items, the bottom line came in at $3.78, up 15% from $3.28 reported in 2018.

Sales rose 5% year over year to $11.7 billion from the prior-year figure of $11.2 billion. The top line surpassed the Zacks Consensus Estimate of $11.6 billion.

Outlook

Crown Holdings now expects adjusted earnings per share to be $5.40-$5.60 for 2020. The mid-point of the guidance range reflects year-over-year growth of 8%. Beverage can volumes are expected to be up more than 5% in 2020.

Share Price Performance


Over the past year, Crown Holdings’ stock have fallen 10.6% compared with the industry’s decline of 28.4%.

Zacks Rank and Stocks to Consider

Crown Holdings currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the Industrial Products sector are SPX FLOW, Inc. (FLOW - Free Report) , Tennant Company (TNC - Free Report) and Cintas Corporation (CTAS - Free Report) . While SPX FLOW flaunts a Zacks Rank #1 (Strong Buy), Tennant and Cintas carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

SPX FLOW has a projected earnings growth rate of 9.1% for 2020. The company’s shares have gained 40.8% in the past year.

Tennant has an estimated earnings growth rate of 4.0% for the ongoing year. In a year’s time, the stock has appreciated 30%.

Cintas has an expected earnings growth rate of 15.7% for the current year. The stock has surged 49.1% over the past year.

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