) reported second-quarter 2013 adjusted earnings of 85 cents per
share, down 4.5% from the year-ago adjusted earnings of 89 cents
per share. The results, however, beat the Zacks Consensus
Estimate by a penny.
Including after-tax charges of 22 cents a share related to
business consolidation, debt refinancing costs and other
activities, the company reported earnings from continuing
operations of 63 cents per share compared with 88 cents a year
Total revenue declined 4% year over year to $2.2 billion in the
reported quarter due to weak demand for beverage cans in North
America. Revenues also missed the Zacks Consensus Estimate of
Cost of sales decreased 4.8% year over year to $1.79 billion in
the reported quarter. Gross profit fell 0.5% year over year to
$403.5 million and gross margin expanded 65 basis points (bps) to
Selling, general and administrative expenses increased 4% to
$102.9 million from the prior-year quarter. Adjusted operating
income declined 5.8% to $226 million from $240 million in the
year-ago quarter. Consequently, operating margin contracted 20
basis points year over year to 10.2%.
Metal Beverage Packaging, Americas & Asia
segment reported revenues of $1.1 billion in the reported quarter
compared with $1.2 billion in the year-ago quarter. Operating
earnings decreased 8% year over year to $125.7 million. The
segment's performance was affected by weak demand for 12 ounce
beverage containers in North America.
Sales from the
Metal Beverage Packaging, Europe
segment decreased 0.5% year over year to $508.7 million in the
quarter. Operating earnings also dropped 7.5% to $51.8 million
due to lower demand, unfavorable mix and higher input costs.
Metal Food & Household Products Packaging,
segment sales increased 2.8% year over year to $382.6 million.
Operating earnings increased 14% to $47.5 million from a year
ago, driven by improved manufacturing performance and high
single-digit volume growth.
Aerospace and Technologies
segment, sales increased 7.5% year over year to $226 million.
Operating earnings, however, decreased 5% year over year to $19
million. The segment had a backlog of more than $966 million at
the end of the quarter.
Cash and cash equivalents were $169.5 million as of Jun 30, 2013
compared with $123.5 million as of Jul 1, 2012. Long-term debt
amounted to $3.4 billion as of Jun 30, 2013, compared with $2.9
billion as of Jul 1, 2012. Cash flow from operating activities
was $57.5 million in the second quarter versus cash use of $74.7
million in the year-ago quarter.
During the second quarter, Ball Corporation issued $1 billion of
4% senior notes due in Nov 2023 and tendered for the redemption
of $375 million of 7.125% senior notes due in Sep 2016.
Ball Corporation retained its guidance of free cash flow for
full-year 2013 at approximately $450 million. The company expects
2013 earnings per share to exceed 2012 results. According to the
company, extension of credit facility and issuance of senior
notes will help in increasing financial flexibility.
Ball Corporation will continue to benefit from product launches,
expansion into emerging markets and strong backlog in its
aerospace and technologies segment. However, loss of a customer,
weak economic condition in Europe and pricing pressure in China
will continue to be headwinds.
The company, however, sees growth potential in many segments.
Metal beverage packaging, Americas and Asia will be benefited by
the Alagoinhas plant's second production line, which is on track.
The Aerospace and Technologies segment will benefit from its
During the quarter, Ball Aerospace continued to diversify its
contract mix with the award of a contract from the Korea
Aerospace Research Institute (KARI) to build the Geostationary
Environment Monitoring Spectrometer (GEMS) for the National
Institute of Environmental Research in the Ministry of
Environment of South Korea. These will act as growth drivers for
Ball Corporation in the upcoming quarters.
Broomfield, CO-based Ball Corporation is the largest manufacturer
of beverage cans in North America. It also supplies aerospace and
other technologies and offers services to government and
Ball Corporation currently retains a short-term Zacks Rank #3
Crown Holdings, Inc.
) 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.
Silgan Holdings Inc.
) posted adjusted earnings of 63 cents per share in the second
quarter, up 15% from 55 cents earned in the year-ago quarter.
Earnings were consistent with the company's guided range of 60
cents to 70 cents per share but missed the Zacks Consensus
Estimate of 65 cents.
BALL CORP (BLL): Free Stock Analysis Report
CROWN HLDGS INC (CCK): Free Stock Analysis
MOBILE MINI INC (MINI): Free Stock Analysis
SILGAN HOLDINGS (SLGN): Free Stock Analysis
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Another peer of Ball Corporation,
Mobile Mini, Inc.
) has yet to announce its quarterly results.