On October 25, 2023, Silgan Holdings Inc (SLGN, Financial), a leading supplier of sustainable rigid packaging solutions, reported its third quarter 2023 earnings. The company reported net sales of $1.80 billion and net income of $110.6 million, or $1.02 per diluted share. This compares to Q3 2022 net sales of $1.97 billion and net income of $138.7 million, or $1.25 per diluted share.
Financial Highlights
Adjusted net income per diluted share for Q3 2023 was $1.16, after adjustments increasing net income per diluted share by $0.14. This compares to Q3 2022's adjusted net income per diluted share of $1.28. The company also reported mid-single digit growth in high value dispensing products and announced a multi-year $50 million cost reduction program.
Adam Greenlee, President and CEO, commented on the results,
Our third quarter results continued to display the strength and breadth of our diverse portfolio, as we delivered our second highest quarterly earnings amidst challenging market conditions. Our high value dispensing business posted another record quarter, and trends in the third quarter developed largely as we expected."
Financial Performance Analysis
Net sales for Q3 2023 were $1.80 billion, a decrease of $167.3 million, or 9%, compared to Q3 2022. This decline was predominantly due to lower volumes. Income before interest and income taxes (EBIT) for Q3 2023 was $194.1 million, a decrease of $25.3 million compared to Q3 2022. The effective tax rates were 24.7% and 25.3% for Q3 2023 and Q3 2022, respectively.
Segment Results
Net sales of the Dispensing and Specialty Closures segment were $559.1 million in Q3 2023, a decrease of $16.4 million, or 3%, compared to Q3 2022. Net sales of the Metal Containers segment were $1.10 billion in Q3 2023, a decrease of $117.4 million, or 10%, compared to Q3 2022. Net sales of the Custom Containers segment were $149.4 million in Q3 2023, a decrease of $33.5 million, or 18%, compared to Q3 2022.
Outlook for 2023
The company has revised its estimate of adjusted net income per diluted share for the full year of 2023 from a range of $3.40 to $3.60 to a range of $3.30 to $3.40 primarily due to anticipated lower volumes in the fourth quarter and higher interest expense.
Financial Tables
The company's condensed consolidated statements of income, balance sheets, and statements of cash flows provide further details on its financial performance. The company reported cash and cash equivalents of $307.1 million as of September 30, 2023. Total assets were $7.81 billion, and total liabilities and stockholders' equity were also $7.81 billion. The company's net cash used in operating activities for the nine months ended September 30, 2023, was $596.0 million.
Explore the complete 8-K earnings release (here) from Silgan Holdings Inc for further details.
