• Earnings Per Share (EPS): $1.65 per share, up from $0.56 per share in the prior year quarter.
• Adjusted Earnings Per Share: $1.67, compared to $1.02 in the prior year quarter.
• Net Sales: Increased by 3.7% year-over-year.
• Segment Income: $398 million, up from $308 million in the prior year quarter.
• Shareholder Returns: $233 million returned, including $203 million in share repurchases.
• Adjusted EBITDA: Trailing 12 months EBITDA above $2 billion for the first time.
• EBITDA Margins: Increased by 260 basis points in the quarter.
• Free Cash Flow: Estimated to be approximately $800 million for the full year 2025.
• Capital Spending: $450 million projected for the full year 2025.
• Net Leverage: Expected to be approximately 2.5 times by the end of 2025.
• North American Food Can Volumes: Increased by 16%.
• Americas Beverage Income: Improved by 25% over the prior year.
• European Beverage Volumes: Increased by 5%.
• Asia Pacific Income: Advanced by 12% in the quarter.

• Warning! GuruFocus has detected 5 Warning Sign with CCK.

Release Date: April 29, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Crown Holdings Inc (NYSE:CCK) reported a significant increase in earnings per share for the first quarter of 2025, rising to $1.65 from $0.56 in the prior year.
• The company experienced a 3.7% increase in net sales, driven by a 16% rise in North American food can volumes and a 1% increase in global beverage can volumes.
• Segment income improved by 29% year-over-year, with notable growth in the Americas and European beverage segments.
• Crown Holdings Inc (NYSE:CCK) returned $233 million to shareholders in the first quarter, including $203 million in share repurchases.
• The company raised its full-year adjusted EPS guidance to a range of $6.70 to $7.10, reflecting confidence in continued strong performance.

Negative Points

• The potential impact of tariffs poses a risk, with the company estimating a possible income exposure of up to $30 million for 2025.
• Transit packaging volumes were lower, reflecting subdued industrial demand, which could be further impacted by tariffs.
• The Asia Pacific region may be more sensitive to global trade tensions, potentially affecting consumer demand.
• The company faces challenges in the North American market due to potential pre-buying and inventory management issues.
• Increased costs for building new plants and lines, with construction and equipment expenses rising significantly compared to previous years.

Q & A Highlights

Q: Can you discuss whether your customers are changing their behavior going into the seasonal peak period, particularly regarding anticipatory buying due to potential higher aluminum costs? A: Timothy Donahue, CEO, explained that on the beverage can side, inventory levels are typically kept short, with cans often delivered and filled within a tight window. There hasn't been significant anticipatory buying, and the LME aluminum prices have decreased since the announcement of tariffs. On the food can side, there might have been some pre-buying in North America due to anticipated tariff impacts on two-piece steel.

Q: Are you seeing any changes in promotional activities by brand owners or retailers, particularly in the food segment? A: Timothy Donahue noted that there isn't significant promotional activity in the food can segment. The growth is more attributed to customer mix, with large pet food customers and vegetable suppliers performing well. In Europe, any concerns about PPI or CPI have been offset by volume gains, and there is an ongoing substrate shift from other materials to cans.

Q: How are trends shaping up in March and April, and have you seen any slowdown in orders? A: Timothy Donahue stated that demand remained firm through the end of April, and there is an expectation of a tight supply situation in North America and Europe for the summer. The company is cautious with its guidance due to potential tariff impacts but anticipates a strong selling season.

Q: Can you provide more color on the strong profitability in the America's beverage segment, particularly with the high incremental margins? A: Timothy Donahue attributed the strong margins to high utilization rates and efficient operations. As factories are well-loaded, incremental volumes contribute significantly to profitability. The company has been strategic in its capital investments and customer partnerships, which has benefited margins.

Q: What is the impact of tariffs on your transit business, and how are you managing quoting and order activities? A: Timothy Donahue mentioned that while quoting opportunities are high, actual orders for equipment are slower due to customers being cautious with capital budgets amid economic uncertainties. The company has reduced its cost footprint, maintaining profitability despite the cyclical nature of the transit business. The direct impact of tariffs is estimated to be below $10 million, primarily affecting equipment made in Europe for the US market.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.