slgn-20210630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


			☒						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021


			☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to ________________

Commission file number 000-22117

SILGAN HOLDINGS INC.

(Exact name of Registrant as specified in its charter)


Delaware		06-1269834
(State or other jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)

4 Landmark Square
Stamford,	Connecticut	06901
(Address of principal executive offices)		(Zip Code)

(203) 975-7110

(Registrant's telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	SLGN	Nasdaq Global Select Market

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 31, 2021, the number of shares outstanding of the Registrant’s common stock was 110,408,113.

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SILGAN HOLDINGS INC.

TABLE OF CONTENTS

			Page No.


Part I. Financial Information			3

Item 1. Financial Statements			3

Condensed Consolidated Balance Sheets at June 30, 2021 and 2020 and December 31, 2020			3

Condensed Consolidated Statements of Income for the three and six months ended June 30, 2021 and 2020			4

Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2021 and 2020			5

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020			6

Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2021 and 2020			7

Notes to Condensed Consolidated Financial Statements			8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			19

Item 3. Quantitative and Qualitative Disclosures About Market Risk			27

Item 4. Controls and Procedures			27

Part II. Other Information			28

Item 6. Exhibits			28

Signatures			29

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Part I. Financial Information

Item 1. Financial Statements

SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)


	June 30, 2021		June 30, 2020		Dec. 31, 2020
	(unaudited)		(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	164,821	$	191,082	$	409,481
Trade accounts receivable, net	891,812		729,275		619,535
Inventories	907,805		821,448		677,534
Prepaid expenses and other current assets	88,818		85,918		92,643
Total current assets	2,053,256		1,827,723		1,799,193

Property, plant and equipment, net	1,832,885		1,729,481		1,840,758
Goodwill	1,719,815		1,668,614		1,741,496
Other intangible assets, net	609,882		635,156		637,208
Other assets, net	508,481		512,082		492,931
	$	6,724,319	$	6,373,056	$	6,511,586

Liabilities and Stockholders’ Equity
Current liabilities:
Revolving loans and current portion of long-term debt	$	240,859	$	391,418	$	28,036
Trade accounts payable	727,523		601,740		802,541
Accrued payroll and related costs	112,270		103,458		130,088
Accrued liabilities	234,503		266,512		230,955
Total current liabilities	1,315,155		1,363,128		1,191,620

Long-term debt	3,176,393		3,106,425		3,223,217
Deferred income taxes	360,027		357,131		355,995
Other liabilities	484,164		456,678		487,881

Stockholders’ equity:
Common stock	1,751		1,751		1,751
Paid-in capital	314,873		296,639		306,363
Retained earnings	2,531,783		2,249,391		2,395,395
Accumulated other comprehensive loss	(263,433)		(297,360)		(260,953)
Treasury stock	(1,196,394)		(1,160,727)		(1,189,683)
Total stockholders’ equity	1,388,580		1,089,694		1,252,873
	$	6,724,319	$	6,373,056	$	6,511,586

See accompanying notes.

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SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

For the three and six months ended June 30, 2021 and 2020

(Dollars and shares in thousands, except per share amounts)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020

Net sales	$	1,348,661	$	1,176,470	$	2,586,771	$	2,206,854
Cost of goods sold	1,113,777		952,375		2,130,421		1,797,661
Gross profit	234,884		224,095		456,350		409,193
Selling, general and administrative expenses	94,394		100,624		191,773		190,487
Rationalization charges	354		1,942		10,711		4,741
Other pension and postretirement income	(12,818)		(9,705)		(25,637)		(19,410)
Income before interest and income taxes	152,954		131,234		279,503		233,375
Interest and other debt expense before loss on early extinguishment of debt	26,406		25,837		52,829		49,326
Loss on early extinguishment of debt	—		—		883		1,481
Interest and other debt expense	26,406		25,837		53,712		50,807
Income before income taxes	126,548		105,397		225,791		182,568
Provision for income taxes	32,072		27,225		58,034		46,796
Net income	$	94,476	$	78,172	$	167,757	$	135,772

Earnings per share:
Basic net income per share	$	0.86	$	0.70	$	1.52	$	1.22
Diluted net income per share	$	0.85	$	0.70	$	1.51	$	1.22

Weighted average number of shares:
Basic	110,442		110,901		110,323		110,879
Effect of dilutive securities	661		433		743		501
Diluted	111,103		111,334		111,066		111,380

See accompanying notes.

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SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three and six months ended June 30, 2021 and 2020

(Dollars in thousands)

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020

Net income	$	94,476	$	78,172	$	167,757	$	135,772
Other comprehensive income (loss), net of tax:
Changes in net prior service credit and actuarial losses	1,876		1,809		3,754		2,748
Change in fair value of derivatives	828		104		1,469		(2,351)
Foreign currency translation	25,669		(1,576)		(7,703)		(38,015)
Other comprehensive income (loss)	28,373		337		(2,480)		(37,618)
Comprehensive income	$	122,849	$	78,509	$	165,277	$	98,154

See accompanying notes.

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SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six months ended June 30, 2021 and 2020

(Dollars in thousands)

(Unaudited)


	2021		2020
Cash flows provided by (used in) operating activities:
Net income	$	167,757	$	135,772
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	122,386		104,197
Rationalization charges	10,711		4,741
Stock compensation expense	10,337		9,056
Loss on early extinguishment of debt	883		1,481
Other changes that provided (used) cash, net of effects from acquisitions:
Trade accounts receivable, net	(277,768)		(179,949)
Inventories	(233,815)		(148,141)
Trade accounts payable	31,825		(68,026)
Accrued liabilities	(24,316)		67,936

Other, net	(17,313)		9,129
Net cash used in operating activities	(209,313)		(63,804)

Cash flows provided by (used in) investing activities:
Purchase of businesses, net of cash acquired	2,305		(941,102)
Capital expenditures	(123,604)		(106,436)
Other, net	4,914		983
Net cash used in investing activities	(116,385)		(1,046,555)

SEC Form 10-Q filed by Silgan Holdings Inc.