Crown in the black

Crown Holdings, the US-based global packaging provider, has announced a drop in its quarterly earnings to the end of September following a change in its accounting terms, but the company's year-to-date results continue to show it is recovering from last year's heavy losses.

For the third quarter of 2003, the company reported net income of $6 million (€5.2m) compared to $71 million in the third quarter of 2002. Year-to-date, the company's net income increased to $22 million, compared to a net loss of $933 million, for the first nine months of 2002.

Crown stressed that the first nine months of 2002 included a $1,014 million charge for the cumulative effect of a change in accounting for goodwill. Before the cumulative effect of a change in accounting, the company reported a net income of $81 million in the first nine months of 2002.

Net sales in the third quarter were $1,853 million, down 2.1 per cent compared to $1,892 million of net sales in the prior year period. For the first nine months of 2003, net sales were $5,039 million, down 4.0 per cent compared to net sales of $5,248 million for the same period in 2002.

The company said that the decline in net sales was anticipated and reflects the impact of divested operations. Net sales for 2003 were said to have reflected the positive effects of stronger foreign currencies ($123 million and $381 million in the third quarter and nine months ended 30 September respectively).

Gross profit in the third quarter was $240 million, or 13.0 per cent of net sales, compared to $246 million, or 13.0 per cent of net sales, in the 2002 third quarter. For the nine months ended 30 September, gross profit was $607 million, or 12.0 per cent of net sales, compared to $657 million, or 12.5 per cent of net sales, in the same prior year period. The company said that the reduced gross profit and gross profit margin reflect increased pension expenses and divested operations - factors that offset improvements realised from stronger foreign currencies.

The Americas division reported net sales of $734 million in the third quarter, $128 million lower than the prior year period, reflecting operations divested in 2002, while the European division generated net sales of $1,023 million in the third quarter, an increase of $79 million, or 8.4 per cent, over last year's third quarter.

The Asia-Pacific division reported net sales of $96 million in the third quarter of 2003 compared to $86 million in the prior year period, thanks to increasing sales.

Crown Holdings​ is a leading supplier of packaging products to consumer marketing companies around the world. World headquarters are located in Philadelphia, Pennsylvania.