Silgan Holdings (NASDAQ: SLGN) reported Q3 EPS of $1.04, $0.09 better than the analyst estimate of $0.95. Revenue for the quarter came in at $1.49 billion versus the consensus estimate of $1.48 billion.

Highlights

• Record net income of $1.01 per diluted share, a 38% increase over the prior year quarter
• Record adjusted net income of $1.04 per diluted share, a 37% increase over the prior year quarter
• Record income before interest and income taxes of $174.0 million
• Achieved record segment volume in each of the businesses
• Segment income for closures and plastic container businesses at record levels

“Each of our segments continued to perform exceptionally well during the third quarter, driving strong segment income across the board and a 37 percent improvement in adjusted earnings per diluted share over the previous record quarter in 2019,” said Tony Allott, Chairman and CEO. “Volume gains across all of our businesses have proved lasting, both through the early lockdown stage of the pandemic and as economies opened up again during the summer. Equally as rewarding has been the outstanding operational performance of the entire Silgan team to meet this demand growth during a challenging time and to demonstrate our unparalleled support for our customers. Each of our businesses has significantly outperformed our competition during these extraordinary times, and our customers continue to reward Silgan with additional volume opportunities,” continued Mr. Allott. “Volume growth of 17 percent in our metal container business continued to be driven primarily by increased at home food consumption and growing consumer awareness of the value and other benefits of canned foods. Our closures business continues to experience strong volume demand primarily for sprayers, foamers and pumps for household cleaning and hygiene products, with legacy dispensing closures volumes up approximately 22 percent which more than offset weakness in certain beauty products. Our plastic container business has continued to demonstrate its market leading customer service model, driving further volume growth of 14 percent and again nearly doubling segment income over the third quarter of 2019,” continued Mr. Allott. “Given anticipated continued strong market demand levels, our great operational performance across the board and our continued confidence in the Silgan team, we are again increasing our outlook for adjusted earnings for 2020 from $2.70 to $2.85 per share to $2.92 to $2.97 per share. At the midpoint of this range, Silgan would have increased adjusted earnings by 36 percent over the record prior year level and delivered a 10 year adjusted earnings per share compound annual growth rate of over 10 percent. While we are still completing our annual budget process for 2021, at this time we anticipate overall operating earnings for the Company remaining at these strong levels,” concluded Mr. Allott.

GUIDANCE:

Silgan Holdings sees Q4 2020 EPS of $0.47-$0.52, versus the consensus of $0.49.

Silgan Holdings sees FY2020 EPS of $2.92-$2.97, versus the consensus of $2.85.

As a result of the Company's year-to-date performance and continued strong demand for our products and strong operating performance, the Company increased its estimate of adjusted net income per diluted share for the full year of 2020 to a range of $2.92 to $2.97 from a range of $2.70 to $2.85, which represents a 36 percent increase at the midpoint of such range as compared to adjusted net income per diluted share of $2.16 in 2019. These estimates assume that the Company, its customers and its suppliers are able to continue running plants during the ongoing COVID-19 pandemic.

The Company is also providing an estimate of adjusted net income per diluted share for the fourth quarter of 2020 in the range of $0.47 to $0.52, a 30 percent increase at the midpoint of such range as compared to adjusted net income per diluted share of $0.38 in the fourth quarter of 2019.

The full year and fourth quarter estimates of adjusted net income per diluted share for 2020 exclude the impact from rationalization charges, costs attributed to announced acquisitions, the purchase accounting write-up of acquired inventory and the loss on early extinguishment of debt.

For earnings history and earnings-related data on Silgan Holdings (SLGN) click here.