Silgan Holdings Inc. (SLGN)

United States Securities and Exchange Commission, Washington, DC, 20549 Form 10-K (Mark One)
Annual Report submitted under section 13, 15 (d)
Pursuant to section 1934th or section 15th, the Securities Trading Act or transition report for the fiscal year ended December 31, 2018 (d)
Provisions of the Securities Exchange Act of 1934 on the transition period from the Commission File 000-
22117 SILGAN Holdings Limited(
The exact name of the registrant specified in the articles of association)Delaware 06-1269834 (
State or other jurisdiction registered or organized)(I. R. S.
Employer identity number)
06901 (4 Stamford Landmark Plaza, Connecticut)
Main executive office address)(Zip Code)
Registrant phone number including area code (203)975-
7110 securities registered under article (b)
Title of the act: each class name of each exchange registered for common stock, with a face value of $0.
Nasdaq Global Select Market Securities Per Share registered under section 12th (g)
Key points of the bill: no one indicates by check mark whether the registrant is a well or not
Well-known experienced issuers as defined in Rule 405 of the Securities Act.
Yes or No o indicate by check mark whether the registrant does not need to submit a report under section 13th or section 15 (d)of the Act.
Yes o no check marks indicate whether the registrant is :(1)
All reports requested in Section 13 or 15 have been submitted (d)
Securities Trading Act of 1934 within the first 12 months (
Or a short period of time required for the registrant to submit such reports), and (2)
This filing requirement has been bound for the last 90 days.
Whether o indicates by check mark whether each interactive data file that the registrant has submitted as required by S-regulation 405th is submitted electronically
12 months before T (
Or within a shorter period of time when the registrant is required to submit such documents).
Yes, no o indicates by check mark whether default declarant is disclosed under S-regulation 405th
To the knowledge of the registrant, K is not included in the final proxy or information statement referenced in Part 3 of this Form 10 and will not be included in it
K or any amendments to this form 10K.
Indicate whether the registrant is a large accelerated filer, non-accelerated filer by checking the mark
A smaller reporting company, or an emerging growth company.
See the definition of \"large accelerated reporting companies\", \"Small reporting companies\" and \"emerging growth companies\" in rule 12b
2 of the Trading Act.
Large accelerated filer non-accelerated filer
If an emerging growth company, it will accelerate reporting to the emerging growth company. Indicate by check mark whether the registrant chooses not to use the extended transition period to comply with any new or revised financial accounting standards provided under section 13 (a)
The Trading Act.
O indicate whether the registrant is a shell company by check mark (
Defined in Rule 12b-
2 parts of the transaction law).
Yes o no total market value of ordinary shares held by non-registrants
Affiliates, with reference to the last sale price of the registrant\'s common stock as of June 30, 2018, this is the last working day of the second fiscal quarter recently completed by the registrant, which is about $2. 07 billion.
The common stock of the registrant held by the registrant\'s executive officer and the director is excluded from the calculation as these persons may be considered affiliated companies.
The determination of this status of association is not a conclusive decision for other purposes.
As of February 1, 2019, the number of shares issued by the registrant\'s common stock was $0.
01 per share, 110,429,596.
Reference to included documents: part of the registrant\'s proxy statement, which will be submitted to the Securities and Exchange Commission within 120 days of the end of the financial year covered in this annual report Form 10-
K, its annual meeting of shareholders to be held on 2019 is cited in part III of form 10 of this annual reportK.
1 item in the first part of the directory page.
Business project 1a.
Item 1b of risk factors.
Staff comments item 2 not resolved
Property item 3.
Legal proceedings 4.
Part II safety disclosure of mine item 5
The market of the registrant\'s common stock, related shareholder matters and the issuer\'s purchase of equity securities Project 6.
Selected Financial Data Items 7.
Management\'s Discussion and Analysis of the financial status and results of operating Project 7.
Quantitative and qualitative disclosure of market risk projects.
Financial statements and supplementary data items 9.
Changes in accounting and financial disclosure project 9a and differences with accountants.
Control and procedures
Other information in part 3.
Director, executive and corporate governance project 11.
Details of executive compensation 12.
Secured ownership of certain beneficial owners and management and related shareholder matters.
Related party transactions and independence of directors 14.
Part IV main accounting expenses and services for item 15.
Annex and schedule 16 to the financial statementsForm 10-K Summary -i-PART I I TEM 1. B USINESS .
Overall, we are the leading manufacturer of rigid packaging for consumer goods.
Our combined net sales are about $4.
2018 4 billion.
Our products are used in various end markets and we operate 100 manufacturing plants in North America, Europe, Asia and South America.
Our products include: steel and aluminum containers for human and pet food and general series products;
Metal and Plastic closure and distribution systems for food, beverages, health care, gardens, personal care, home and beauty products;
Custom designed plastic containers for personal care, food, health care, pharmaceutical, home and industrial chemicals, pet food and care, agriculture, automotive and marine chemical products.
We are a leading manufacturer of metal containers in North America and Europe, and in North America we are the largest manufacturer of metal food containers, with a market share of just over half in the US in 2018.
Our leadership in these markets is supported by our high level of quality, service and technology, our low-cost producer status, our strong long term
Through our extensive geographic location, the term customer relationship and our proximity to our customers.
We have 44 metal container manufacturing plants in the United States, Europe and Asia, serving more than 50 countries around the world.
In addition, we believe that we have the most comprehensive equipment capabilities in the industry.
In 2018, our net sales for our metal container business was $2. 38 billion (
About 53.
5% of our combined net sales)
Operating income is $198. 8 million (
About 46.
We do not include 1% of the combined revenue of the company\'s expenses).
We are also the world\'s leading manufacturer of metal and plastic closure and distribution systems for food, beverages, healthcare, gardens, personal care, home and beauty products.
Our leadership in closed areas is the result of our ability to provide our customers with a high level of quality, service and technical support.
Our closed business provides customers with a wide range of proprietary metal and plastic closed and innovative distribution system solutions to ensure the quality and safety of the closed, as well as the country-of-the-
Art capping/sealing equipment and inspection systems that complement our closed products.
We have 33 closed manufacturing plants in North America, Europe, Asia and South America, and we serve more than 70 countries around the world.
In addition, we license our technology to five other manufacturers for a wide range of international markets that we do not directly serve.
In 2018, the net sales of our closed business was $1. 46 billion (
About 32.
7% of our combined net sales)
Operating income is $189. 9 million (
About 44.
We do not include 0% of the combined revenue of the company\'s expenses).
In addition, we are the leading manufacturer of plastic containers in various markets in North America, including personal care, food, healthcare, and the home and industrial chemical markets.
Our success in the plastic packaging market is largely due to our ability to provide our customers with a high level of quality, service and technical support, as well as our value --added design-
We have 23 manufacturing plants in the US and Canada, focusing on products and a wide range of geographical locations.
We produce plastic containers with a variety of resin materials and provide a variety of molding and decorative capabilities.
In 2018, our net sales of plastic containers business was $614. 1 million (
About 13.
8% of our combined net sales)
Operating income is $42. 6 million (About 9.
We do not include 9% of the combined revenue of the company\'s expenses).
Our customer base includes some of the best in the world.
Well-known brand consumer goods company.
Our philosophy has been developing.
Maintain customer relationships by working with our customers, providing reliable quality, service and technical support, and leveraging our low-cost producer status.
Our large number of multi-customer relationships prove the power of our customer relationships
One year supply arrangement, our high level of retention of the customer\'s business, and our continued recognition of the customer, as evidenced by the many quality and service awards we have received.
We estimate that in 2019 we expect about 90% of the sales of metal containers, and we expect the closure and most of the sales of plastic containers to be completed in multiple months
Annual customer supply arrangement.
Our goal is to grow our business by effectively allocating capital and managing resources, reducing operating costs, establishing a sustainable competitive position, or franchising, to increase shareholder value. And complete the acquisition that generates attractive cash returns.
We are confident that we will achieve this because of our leading market position and management expertise in acquiring, financing, integrating and efficiently operating our consumer packaging business.
We are a company in Delaware.
We were in 1987 by ourExecutive Co-
Chairman of the Board R.
Philip silver and D. Greg Horrigan.
Since we were founded, we have gained 30-Five Businesses
Thanks to the benefits of acquisitions and organic growth, we have become a leading manufacturer of metal containers in North America and Europe with net sales of $2.
At 38 billion in 2018, our overall share of the metal food container market in the US increased from about 10% in 1987 to just over half in 2018.
Through the acquisition, we have become the world\'s leading manufacturer of food, beverage, healthcare, gardens, personal care, home and beauty products closure with net sales of $1.
46 billion in 2018, it has grown seven times since we acquired white hat closure in the US in 2003.
Our market position in the plastic container business has also increased since 1987, with net sales increasing 7 times to $614.
2018 1 million.
The following chart shows our acquisition since its inception: acquired Nestle food company metal container manufacturing department 1987 metal food container Monsanto Company plastic container business 1987 dial-up company Plastic container Fort Madison Can Company 1988 metal food container coastal carton Department Nestle food company 1988 cardboard container Aim packaging, company.
Fortune Plastics 1989 plastic containers
1989 plastic container express plastic container Co. , Ltd. 1989 plastic container Amoco container company 1989 plastic container Del Monte Corporation, United States of AmericaS.
Can manufacturing business USA National Can 1993 metal food container food metal and special business 1995 metal food container and metal closed Finger Lake packaging company
Subsidiary of Bird eye Food Co. , Ltd.
Metal food containers, Alcoa 1996
North American aluminum roll-
Closed business 1997 aluminum roll-
Rexam PLC North American plastic container business 1997 plastic container and bottle cap Winn packaging company
1998 plastic turnover box Jinbao soup company steel container production enterprise 1998 metal lunch box Clearplass Container Co. , Ltd.
1998 plastic containers of RXI Holdings Limited
2000 plastic containers and plastic caps, sifters and accessories Thatcher tubles LLC 2003 plastic hose Amcor white caps, LLC 2003 metal, the Pacific Coast producer can manufacture 2003 metal food containers Amcor white caps (
Europe, Asia and South America)2006-
2008 vacuum enclosure for metal, composite and plastic
Currie Limited 2006 plastic container 2 acquired Grup Vemsa 1857, product of the business yearL.
Metal vacuum closing business in Spain and China 2008 metal vacuum closing IPEC Global, Inc.
Its Vogel and Noot holding subsidiaries operate 2010mm metal containers dgs s for metal containers with 2011 plastic caps. A. ’s twist-
Closing metal closure operation 2011 metal vacuum closure metal container manufacturing operation 2011 metal container for Nestle Purina PetCareS.
Rexam high barrier food container Co. , Ltd 2012 metal container and metal vacuum enclosure
Plastic food container operation of Rexam PLC 2012 plastic food container Amcor Packaging (Australia)
Pty Ltd. metal vacuum sealing business 2013 metal vacuum sealing Portola Packaging in Australia, Inc.
And its subsidiary 2013 plastic off Tecnocap S. p. A.
Metal vacuum closing business in USA and Tecnocap LLC in USAS.
2013 metal vacuum closure Van Can Company metal container manufacturing assets 2014 metal containers injected into plastic company
Action plastic cap 2015mm plastic cap WestRock Company professional seal dispensing system business 2017 seal and distribution system on April 6, 2017, we obtained the action of professional WestRock Company\'s closure and distribution system, now run in the name of Silgan distribution system or SDS.
SDS is the world\'s leading provider of health care, gardens, personal care, home, beauty and food height engineering triggers, pumps, sprayers, and distribution closure solutions.
SDS is a strategic acquisition for us, providing us with the opportunity to expand the closure of the franchise.
We intend to enhance our position as a leading manufacturer of consumer packaging products by continuing to actively implement strategies aimed at achieving future growth and increasing shareholder value: Since our inception, we have been supplying \"B. est v. ALUE \"P. packaged products, including quality, service and technical support, and intend to continue to work on the continuous supply of our products in a quality-integrated manner, the price and service that our customers consider \"best value.
\"In our metal container business, we focus on delivering high quality and high level of service and taking advantage of our low-cost producer status.
We have and will continue to invest heavily in capital to provide value to our customers-
Added features like our fast Top series®Simple-
Opening of our metal food containers, shape metal food containers and alternative color products for metal food containers.
In addition, we have and will continue to invest to improve the competitive advantage of food metal packaging, including the new US manufacturing plant completed in 2016, to better optimize the logistics footprint of our metal container business.
In addition, in 2018, we commercialized a smaller, near-
Manufacturing facilities on site in the US to support the growth of certain customers.
In our closed business, we emphasize high quality, service and technical support.
We believe our closure business is the preferred provider of innovative closure and distribution system solutions for the food, beverage, healthcare, garden, personal care, home and beauty industries.
We provide customers with a wide range of metal and plastic closures for food and beverage products, as well as proprietary equipment solutions for ensuring the safety of high-quality packaging, such as cover feeders, calipers and inspection systems.
We also manufacture a wide range of highly engineered distribution systems for healthcare, gardens, personal care, home, beauty and food around the world.
In our plastic container business, we provide a high level of quality and service and focus on value
In addition, custom designed plastic containers can meet the changing product and packaging needs of customers.
We believe that we are one of the few plastic packaging enterprises that can customize the design, manufacture and decoration of various plastic containers, providing customers with the ability to meet their more plastic packaging needs through a supplier.
We will continue to provide customized products for quick delivery to our customers with superior levels of design, development and technical support.
We have made strategic investments to improve the competitive position of our plastic container business, including the construction of two new plastic container manufacturing facilities completed in 2016 in the United States, one of which is a near
Provide on-site facilities to key customers and other customers to meet their growing needs and enable us to further reduce the cost of the plastic container business.
In addition, in 2018, to support sustained growth, we commercialized a new thermoforming plastic container manufacturing facility in the United States.
We will continue to seek opportunities to strengthen our low-cost position in the business by maintaining a unified and efficient organizational structure that reduces sales, general and administrative expenses as a percentage of consolidated net sales;
To achieve and maintain economies of scale,
Prudent investment in new technologies to improve manufacturing and production efficiency;
Rationalize the structure of our existing factory;
And serve our customers from our factory located in a strategic location.
We believe that through our metal container facilities, we are able to provide the most comprehensive manufacturing capability in the industry.
Through our closed business, we have manufactured a wide variety of metal and plastic closure devices and highly engineered distribution systems for food, beverages, healthcare, gardens, personal care, home and beauty industries around the world take advantage of countries-of-the-
Advanced technology and equipment, we also provide countries for our customersof-the-
Art cover/sealing equipment and inspection system.
Through our plastic container facilities, we have the ability to produce customized products throughout the entire range of resin materials, decorative techniques and molding processes requested by our customers.
We intend to continue to create costs using our manufacturing, design and engineering capabilities
Effective manufacturing systems will drive improvements in product quality, operational efficiency and customer support.
In 2016, we completed the optimization plan in each business, reduced manufacturing and logistics costs, increased productivity and manufacturing efficiency, and therefore, build a lower cost manufacturing network for our businesses and strengthen the competitive position of each of our businesses in their respective markets.
Combined with these optimization plans, we completed the construction of a new metal food container manufacturing facility and two new plastic container manufacturing facilities in the United States, relocate various equipment lines to facilities where we can better serve our customers and rationalize several existing manufacturing facilities.
In order to meet the unique needs of customers, these three new manufacturing facilities are in a strategic position.
In 2018, we commercialized a new metal container manufacturing plant and a new thermoforming plastic container manufacturing plant to support sustained growth in key markets in each case.
Although our financial strategy is to use reasonable leverage to support our growth and increase shareholder returns.
Our stable and predictable cash flow is mainly due to our long-term
Long-term customer relationships and a general anti-recession business support our financial strategy.
We intend to continue to use reasonable leverage for value-added acquisitions with stable cash flow support.
In determining reasonable leverage, we evaluate our capital costs and manage our debt levels based on current market conditions to maintain the best capital costs.
If no acquisition opportunity is found for a longer period of time, we may use cash flow to repay the debt, buy back shares of our common stock, or increase dividends for shareholders or other permitted purposes.
In 2016, we used cash on hand and revolving loan loans under existing senior secured credit loans or 2014 credit loans at that time to fund the repurchase of common shares at a price of US $277. 3 million (
That includes $269.
We purchased 4 million of our common stock according to the \"revised Dutch auction\" bid offer completed on November 2016).
On February 2017, we issued $0. 3 billion of 4% Senior Notes due at 2025, or 4% of 0. 65 billion notes due at 3%, or 2025 of senior notes due at 3% euros.
We use the net income of 4% notes to advance a portion of our outstanding Treasury bonds. S.
US dollar term loan and repay part of the outstanding revolving loan under our 2014 credit line.
We use the net income of 3% Notes 4 to prepay all outstanding euro term loans and repay all remaining outstanding revolving loans under our 2014 credit line, repayment of certain foreign bank revolving loans and fixed-term loans of some of our non-banksU. S.
Subsidiaries and 0. 22 billion of outstanding 5% premium notes redeeming $2020, or 5% notes.
On March 2017, we completed the modification and restatement of our 2014 credit line, and signed a revised and restated senior secured credit line, extending the due date of our senior secured credit line, provide us with additional borrowing capacity and greater flexibility for our strategic initiatives.
On May 2018, we revised the revised and restated senior secured credit loan, and the revised credit agreement further extended the due date and reduced the loan balance, additional flexibility was provided in terms of strategic initiatives.
Our credit agreement provides us with revolving loans, including multi-currency revolving loans of about $1.
A 15 Canadian dollar revolving loan mechanism in 19 billion and Canada. 0 million.
In addition, our credit agreement provides us with regular loans, including (i)U. S.
US-designated $0. 8 billion in fixed-term loansS.
Term loans and (ii)Cdn $45.
5 million of the term loans are designated as term loans in Canada.
In April 2017, we funded the purchase price of SDS with $0. 8 billion. S.
Term Loan and Revolving loan according to our credit agreement.
On April 2018, we redeemed all the remaining outstanding 5% bills ($280.
Total Principal 0 million)
According to our credit agreement and cash-on-hand revolving loan.
You should also read Notes 3 and 9 to the consolidated financial statements for the year ended December 31, 2018 included in other parts of this annual report.
We intend to continue to increase the market share of our current business lines and related business lines through acquisitions and internal growth.
We take a disciplined approach to acquisitions and investments to generate attractive cash returns.
We therefore hope to continue to expand and diversify our customer base, geographic location and product line.
This strategy has enabled us to increase net sales and operating income over the past decade.
We are a leading manufacturer of metal containers in North America and Europe, mainly due to our acquisition and also due to growth with existing customers.
The metal food container market in North America has experienced significant consolidation over the past 30 years, mainly because food processors want to reduce costs and focus their resources on their core business, not on their own
Make metal food containers.
We acquired the metal food container manufacturing business of Nestle food company or Nestle, Dial Company or dial, Del Monte company or Del Monte, Bird eye food company
Campbell Soup, or Campbell, a Pacific Coast producer, or a Pacific Coast company, and a steel container from Nestlé
The manufacturing assets of Purina Steel can reflect this trend.
We estimate that about 7% of the metal food container market in the United States is still served by self-helpmanufacturers.
While we have expanded our metal container business mainly through acquisitions and growth with existing customers, increasing our market share of metal containers, we have also made progress in the past few years, and continue to invest heavily in our metal container business to strengthen our business and provide value to our customers-
Added features like our Quick Top series®Simple-
Open end of product of alternative color of metal food container, shape metal food container and metal food container.
In 2018, about 70% of our metal food containers were sold. open end.
In addition, we have and will continue to invest to improve the competitive advantage of metal packaging for food.
In 2016, we completed the construction of a new metal food container manufacturing plant in Burlington, Iowa to better optimize our logistics footprint in our North American metal container business, enables us to further reduce the cost of the metal container business.
In addition, in 2018, we commercialized a smaller, near-
Set up a plant in Breinigsville, Pennsylvania to support the growth of certain customers.
By acquiring our closing operations in North America, Europe, Asia and South America, we have established ourselves as the world\'s leading manufacturer of shutdown and distribution systems for food, beverage metals and plastics, health care, garden, personal care, home and beauty products.
In 2017, we expanded our closed product portfolio, including the distribution of systems by acquiring SDS.
Since 2003, after our acquisition of white hat in the United States to close the business, our net sales of closing the business increased by 7 times to $1.
As a result of acquisitions and internal growth, it was 46 billion per cent in 2018.
We may seek further integration opportunities in the closed markets we operate, including dispensing systems or adjacent closed markets.
In addition, we expect that our closed business, especially the plastic closed and distributed system, will continue to generate internal growth.
When investing in the pursuit of internal growth, we used a disciplined approach to generate attractive cash returns.
Since 1987, our market position in the plastic container business has been increasing, with net sales increasing seven times to $614.
2018 1 million.
We have achieved this improvement mainly through strategic acquisitions and internal growth.
In 2016, we completed the construction of two new plastic container manufacturing facilities, including a near
Provide on-site facilities for key customers and other facilities to meet the growing needs of our customers and enable us to further reduce the cost of the plastic container business.
The new facilities are located in northeast Pennsylvania and hazwood, Missouri.
In addition, in 2018, we commercialized a new thermoforming plastic container manufacturing facility in Fort Smith, Arkansas to support sustained growth.
The plastic container portion of the consumer packaging industry is still highly dispersed and we intend to seek further integration opportunities in this market.
We also hope that our plastic container business will continue to grow internally.
As with acquisitions, we pursue internal growth in a disciplined way to generate attractive cash returns.
Through the combination of these efforts, we intend to continue to expand our customer base in markets such as personal care, food, healthcare, pharma, etc, markets for home and industrial chemicals, pet food and care, agriculture, automobiles and marine chemicals.
We intend to increase productivity, manufacturing efficiency, reduce manufacturing costs by investing in capital, continue to improve profitability and optimize our production facilities.
Additional sales and production capabilities provided through acquisitions and investments enable us to streamline plant operations and reduce overhead costs by closing and scaling down the plant.
Starting from 2014, we have closed four metal container manufacturing facilities, one closed manufacturing facility and four plastic container manufacturing facilities, which is related to our continued efforts to simplify factory operations and reduce operating costs, better match supply to geographic demand.
We expect that, thanks to the other benefits of optimizing production scheduling and economies of scale, as well as eliminating redundant sales and management functions, most future acquisitions will continue to enable us to achieve manufacturing efficiency.
In addition to the benefits achieved by integrating the acquisition business, we have improved and expect to continue to improve the operational performance of our plant facilities through investment to increase productivity, improve manufacturing efficiency and reduce manufacturing costs.
Although we have made some investments in some factories, there are still more opportunities in the whole system.
We will continue to look for these opportunities with a rigorous attitude to generate attractive cash returns.
In 2016, we completed the optimization plan in each business, reduced manufacturing and logistics costs, increased productivity and manufacturing efficiency, and therefore, build a lower cost manufacturing network for our businesses and strengthen the competitive position of each of our businesses in their respective markets.
Combined with these optimization plans, we completed the construction of a new metal food container manufacturing facility and two new plastic container manufacturing facilities, relocate various equipment lines to facilities where we can better serve our customers and rationalize several existing manufacturing facilities.
In order to meet the unique needs of customers, these three new manufacturing facilities are in a strategic position.
In 2018, we commercialized a new metal container manufacturing plant and a new thermoforming plastic container manufacturing plant to support sustained growth in key markets in each case.
We are a holding company that operates through various operating subsidiaries.
We operate three businesses, our metal container business, our closed business and our plastic container business.
Metal container-53.
5% of our 2018 net sales we are a leading manufacturer of metal containers in North America and Europe, and in North America we are the largest manufacturer of metal food containers, with a market share of just over half in the US in 2018.
Our metal container business is engaged in the manufacture and sale of steel and aluminum containers, which are mainly used for processors and packagers of pet foods, vegetables, soups, proteins and other foods (e. g.
Meat, chicken and seafood)
Products using tomatoes as raw materials, adult nutritious beverages, fruits and other miscellaneous foods, as well as general metal containers mainly used for chemicals.
We have 44 metal container manufacturing plants in the United States, Europe and Asia, serving more than 50 countries around the world.
In 2018, our net sales for our metal container business was $2. 38 billion (
About 53.
5% of our combined net sales)
Operating income is $198. 8 million (
About 46.
6 We do not include 1% of the combined revenue from the operation of the company\'s expenses).
We estimate that about 90% of the projected sales of metal containers in 2019 will come from
Annual customer supply arrangement.
While metal containers face competition from plastic, paper, glass and composite containers, we believe that metal containers are superior to plastic, paper and composite containers in applications where contents are prepared at high temperatures, or packaged in a larger number of consumers or institutions, or in the long
While maintaining the quality of the product, the long-term storage of the product is desirable.
We also believe that metal containers are generally more ideal than glass containers because they are more durable and cost less to transport.
In addition, the metal container is one of the most recyclable packaging in the world, which can be recycled indefinitely.
Although the metal food container market in the United States has barely increased in the past decade, we have increased the market share of metal food containers in the United States, mainly through acquisitions and growth with existing customers, and enhance our business by focusing on delivering high quality, high level of service and value to our customers --
Added features like our fast Top series®Simple-
The open end of the metal food container, the shape of the metal food container and the alternative color product.
In addition, we have and will continue to invest to improve the competitive advantage of metal packaging for food.
In 2016, we completed the construction of a new metal food container manufacturing plant in the United States to better optimize the logistics footprint of our metal container business in North America, enables us to further reduce the cost of the metal container business.
In addition, in 2018, we commercialized a smaller, near-
Manufacturing facilities on site in the US to support the growth of certain customers. C LOSURES —32.
With 7% of our combined net sales in 2018, we are the world\'s leading manufacturer of metal and plastic closure and distribution systems for food, beverages, healthcare, gardens, personal care, home and beauty products.
Our closed business provides customers with a wide range of proprietary metal and plastic closed and innovative distribution system solutions to ensure the quality and safety of the closed, as well as the country-of-the-
Art capping/sealing equipment and inspection systems that complement our closed products.
We have 33 closed manufacturing plants in North America, Europe, Asia and South America, and we serve more than 70 countries around the world.
In addition, we license our technology to five other manufacturers for a variety of markets that we do not directly serve.
In 2018, the net sales of our closed business was $1. 46 billion (
About 32.
7% of our combined net sales)
Operating income is $189. 9 million (
About 44.
We do not include 0% of the combined revenue of the company\'s expenses).
Since 2003, after we acquired white hat closing business in the US, we have developed our closing business through acquisition and internal growth, and net sales have increased by 7 times.
We produce metal and plastic closures for food and beverage products, such as ready-madeto-
Drink tea, sports drinks, dairy products, tomato sauce, salsa, pickles, baby food, juice drinks, tomato sauce, jam, soup, cooking sauces, beef, fruit, vegetables and baby formula products.
We acquired SDS in 2017 and expanded our closed product portfolio to produce distribution systems for healthcare, gardens, personal care, home, beauty and food, such as health nasal spray and external medication, lawn and Garden Supplies, hard surface cleaning supplies, professional cleaning supplies, air and fabric care products, perfume and fragrance products, skin care products, lotions, cosmetics, soap, hair care products and other bath and body products and condiments.
We offer our customers in closed business a customized formula for sealing/lining materials, designed to minimize disassembly torque, improve the openness of the closure, or maintain the sealing of the closure, while meeting the unique needs of customers, it also meets the applicable regulatory requirements.
We offer a wide range of decorative options to our customers to differentiate their products.
We also provide our customers with sealing/capping equipment and inspection systems to complement our closed products.
Due to our wide range of closures and our superior location, we focus on providing a high level of quality, service and technical support, and we believe that we are in a unique position in providing food, beverage, health care, garden, personal care, home and beauty products companies that meet their closed needs.
P lastic shoes-13.
Of our combined net sales of 8%, 2018 of our products are plastic containers produced from a variety of resin materials and provide comprehensive molding and decorative capabilities.
We are one of the leading manufacturers of high density polyethylene or high density polyethylene and PET containers custom designed for the market we serve.
We are also the leading manufacturer of plastic thermoforming barrier and non-forming barrier in North America
Barrier bowl and tray for shelves
Food is stable.
We operate 23 plastic container manufacturing facilities in the United States and Canada.
In 2018, our net sales of plastic containers business was $614. 1 million (
About 13.
7% of our net sales)
Operating income is $42. 6 million (About 9.
We do not include 9% of the combined revenue of the company\'s expenses).
Since 1987, the market position of our plastic container business has improved and net sales have increased by 7 times.
We manufacture custom designed and stocked plastic containers for personal care and health care products, including containers for mouthwash, shampoo, conditioner, hand cream, lotion, hand sanitizer, breath and stomach products, cosmetics and toiletries
Food and beverage products including peanut butter, salad dressing, condiments, dairy products and alcohol;
Containers for lawn, garden, agricultural products, detergent, detergent and other household and industrial chemical products;
Drugs, including containers of tablets and antacids.
In addition, we also produce Plastic Thermoforming barriers and non-
Barrier bowls and trays for food such as soup-to-
Catering and pet food, as well as thermoformed plastic buckets for food, home and personal care products (including soft fabric wipes.
We also manufacture plastic caps, sifters and accessories for food and household products, including salad dressing, condiments, peanut butter, spices, liquid margarine, powder beverage mixture and craft supplies.
Our leading position in the plastic container market is largely driven by our rapid response to customer design, development and technical support needs and our value --
A variety of product lines have been added.
This product line is the result of our extensive manufacturing, molding and decorative capabilities to produce plastic containers from a variety of resin materials.
We also strive to maintain innovation in resin composition and application and to predict changes in plastic container manufacturing technology to a certain extent.
As significant consolidation is taking place in many of our customer markets, we benefit from our massive presence across the country.
Through these capabilities, we
Positioned to serve our customers, they need customized solutions as they continue to seek innovative means to differentiate their products in the market using packaging.
In 2016, we completed the construction of two new plastic container manufacturing facilities in the United States, including a near
Provide on-site facilities for key customers and other facilities to meet the growing needs of our customers and enable us to further reduce the cost of the plastic container business.
In addition, in 2018, to support sustained growth, we commercialized a new thermoforming plastic container manufacturing facility in the United States.
Manufacturing and production as a practice in the industry, most of our customers provide us with regular product and quantity estimates based on which we make a commitment.
These estimates allow us to effectively manage the production and control of working capital requirements.
We arrange production to meet the requirements of our customers.
Because the production time of our products is very short, the backlog of customer orders related to our sales is not important.
As of February 1, 2019, we have operated 100 production facilities in 19 different countries around the world to meet the needs of our customers.
The manufacturing business of the metal container business includes cutting, coating, printing, manufacturing, assembly and packaging of finished cans.
There are three basic processes in our production of canned goods.
Traditional three
The piece counting method requires three flat metals to form a cylindrical shape with welded edge joints, bottoms and tops.
By using advanced electronic welding monitors and coatings to ensure the high integrity of the side welds, these monitors and coatings are heat cured through induction and convection processes.
The other two methods of producing cans are to form a shallow cup first and then form the required height using the stretching and ironing process or the stretching and re-stretching process.
We manufacture steel and aluminum using stretch and re-stretch processes
The height of the piece tank generally does not exceed the diameter.
For tanks with a height greater than diameter, we manufacture steel 2-
Make the cans by using the drawing and ironing process.
We can make from thin, high bodies and ends
Use the tank manufacturing equipment designed and selected by proprietary tools and molds to strengthen aluminum alloy and steel.
We also produce our fast tops. ®Simple-
In the complex process of precision progressive mold, the opening end of steel and aluminum alloy.
We check our quick top regularly®Simple-
Improve the open design of the best consumer preferences through consumer research and feedback.
Make sure that the manufacturing operation of metal closed parts includes cutting, coating, printing, manufacturing and lining.
We produce twist.
Off, lug and press-on, twist-
Closed steel cover and aluminum roll-
Closure of glass, metal and plastic containers ranging in diameter from 18 to 110.
We hire countries. of-the-art 8 multi-
Die Press for the manufacture of metal closed parts, providing low
High cost, high quality means of production.
We also provide our closed business customers with customized formulas for sealing/lining materials designed to minimize torque removal and improve the open nature of the closed while meeting applicable regulatory requirements.
We produce plastic caps and distribution systems using two basic processes.
During the compression molding process, the particles of the plastic resin are heated, extruded, and then compressed to form a plastic closed shell.
The plastic enclosure can include a molded wireless seal or a customized compressed molded seal system.
The plastic enclosed housing can then be cut and printed according to the end use.
During the injection molding process, plastic resin particles are heated and injected into the mold to form a plastic housing or other distribution system components such as triggers, decorative covers, actuators, valves, or overcovers.
The plastic closure shell can include a molded wireless seal or a customized sealing system.
The plastic enclosed housing can then be cut and printed according to the end use.
In the case of the dispensing system, the dispensing system components are assembled into the dispensing system, and can be printed according to the final use of the dispensing system.
We produce plastic containers using two basic processes.
During extrusion blow molding, the particles of the plastic resin are heated and squeezed out of the plastic pipe. A two-
Then, close a piece of metal mold around the plastic pipe and blow the high pressure air into it, causing the bottle to form the mold shape.
During the injection and injection stretch blow molding process, the particles of the plastic resin are heated and injected into the mold to form the plastic preforming body.
Then blow the plastic pre-made stick into the bottle-
Create a plastic bottle by shaping a metal mold.
Our Plastic Thermoforming bowls, trays and bathtubs are made by melting plastic resin particles into extruded plastic sheets.
The plastic sheet is then formed into a mold and made into a plastic bowl, tray or bathtub. We have state-of-the-
Art and decoration equipment, including several of the largest complex decoration facilities in the United States.
Our plastic container decoration method is-
Mold label, put plastic film label to bottle during blowing, and postMold decoration. Post-
Mold decoration includes: screen decoration, which can apply images of multiple colors to bottles;
Use pressure-sensitive decoration of plastic film or paper label with adhesive;
Heat transfer decoration using plastic coating labels applied by heating;
And Shrink Sleeve Label.
Based on our existing arrangements with our suppliers and our current and expected requirements, we believe that we are well prepared to obtain raw materials in the foreseeable future.
However, due to the large integration of suppliers, we rely on a limited number of suppliers of steel, aluminum, coatings and composite raw materials.
The price of raw materials is generally passed on to customers according to our many
Annual customer supply arrangement and increase through general price.
We use tin-plated steel and chrome-plated steel, aluminum, copper wire, organic coating, lining compound and ink in the manufacture and decoration of metal container products.
Our material requirements are provided through agreements and purchase orders with suppliers we work with for a long time
Term relationship.
If our suppliers do not deliver as they arrange, we will be forced to buy raw materials in the open market and we cannot guarantee that we will be able to buy this raw material or, if we can, we will be able to purchase these raw materials at comparable prices or terms.
Although the supplier has done a lot of integration, we believe that we are prepared enough to purchase a sufficient amount of these raw materials to meet the requirements of our customers in the foreseeable future.
The metal container supply agreement we have signed with our customers provides delivery for our metal cost changes.
For customers who do not have long metal containers
Long term agreements, we also generally raise prices to increase our metal costs by increasing them.
We use tin-plated steel and chrome-plated steel, aluminum, organic coating, low
Metal inks and cardboard, plastic and organic lining materials in the manufacture of metal closures.
We use resin in the form of particles in the manufacture of plastic closure and distribution systems, such as homogeneous polypropylene, polypropylene and high density polyethylene, thermoplastic elastic lining materials, processing additives and pigments.
Although we can\'t guarantee it, we believe that despite the large integration of suppliers, we are prepared enough to buy enough of these raw materials to meet the requirements of customers in the foreseeable future.
Our closed supply agreement with our customers usually specifies changes in the cost of our metals and resins, and in many cases the resin lags behind in the time of this passage.
For customers we don\'t close for a long time
Long term agreement, our closing business also usually changes through the cost of our metals and resins.
The raw materials we use in the plastic container business are mainly resin in the form of particles, such as raw high density polyethylene, raw PET, recycled high density polyethylene, recycled PET, polypropylene and, to a lesser extent, polystyrene, low density polyethylene, pet diol, PVC, polyester and medium density polyethylene.
Our resin demand is through more
Make annual arrangements with several major resin suppliers on specific quantities of resin.
The price we pay for resin raw materials is not fixed, subject to market pricing, which has fluctuated greatly in the past few years.
The plastic container supply agreement we have signed with our customers provides for the delivery of our resin cost changes, and in many cases the time for such delivery will lag.
For our plastic container customers who don\'t have a long time
Long term agreement, our plastic container business also generally changes through the cost of our resin.
We believe that in the absence of unforeseen events such as major hurricanes, we are prepared enough to purchase a sufficient amount of resin to meet the customer\'s requirements for the foreseeable future
Our philosophy has been developing --
Maintain customer relationships by working with our customers to provide reliable quality and service.
We sell our products mainly through direct sales staff including manufacturer representative, and part of our plastic container business through dealer network.
Due to the high cost of transporting empty containers, our metal container business is usually sold to customers within a 300 mile radius of its manufacturing plant.
Net sales of Nestle in 2018 were approximately 11%, 11% and 13%, respectively, at 2017 and 2016.
During this period, no other customer accounted for more than 10% of our total consolidated net sales.
You should also read \"risk factors --
We are faced with competition from many companies, because of which we may lose sales or experience lower profits in sales \".
We are a leading manufacturer of metal containers in North America and Europe, and in North America we are the largest manufacturer of metal food containers, with a market share of just over half in the US in 2018.
We have 44 metal container manufacturing plants in the United States, Europe and Asia, serving more than 50 countries around the world.
The largest customers of these products include Bonduelle Group, Campbell, Conagra Brands, Inc.
Crider Food Co. , Ltd.
Dermont General Mills Limited
Pet Nutrition Limited by Hill
Hormel Foods, Kraft Heinz, Mars, Nestle, Pacific Coast, Stanislaus foods and Teasdale premium foods
How much we have entered.
Make annual supply arrangements with most of our customers for our metal container business.
We estimate that about 90% of the projected sales of metal containers in 2019 will come from
Annual customer supply arrangement.
Historically, we are continuing these many
Annual customer supply arrangement.
In Europe, our metal container business has long been
Establish long-term relationships with many customers, although many supply arrangements are negotiated within one year as usualby-year basis.
Since its inception in 1987, we have provided most of our American products to Nestlé. S.
Requirements for metal food containers.
In 2018, our net sales of metal food containers to Nestle were $462. 2 million.
We also supply Nestle in North America and Europe and plastic containers in North America.
At 2018, we entered long-
The long-term supply agreement with Nestle runs through 2025 to supply all North American Metal food container requirements of Nestle for pet food and other foods and to support Nestle\'s growth plan. These long-
The long-term supply agreement replaces the previous supply agreement with Nestle.
These long ones
The periodic supply agreement provides for certain prices and provides that they will be increased or reduced according to the formula of price change.
The sales and operating income of our metal container business depends in part on the vegetable and fruit harvest in the Midwest and western regions of the United States, to a lesser extent, in the planting areas in multiple European countries.
The size and quality of these harvests vary from year to year, depending largely on the weather conditions in these areas.
Due to the seasonality of the harvest, we experienced higher unit sales in the third quarter of the fiscal year, and in that quarter we received a non-proportional annual income from operations.
You should also read \"risk factors --
The seasonal nature of the fruit and vegetable packaging industry has caused us to suffer short-term losses
Other parts of this year\'s report include periodic debt.
We are the world\'s leading manufacturer of metal and plastic closure and distribution systems for food, beverages, health care, gardens, personal care, home and beauty products.
We have 33 closed manufacturing plants in North America, Europe, Asia and South America, and we serve more than 70 countries around the world.
The biggest customers of our closed business include Campbell of coca.
Colgate Cola Company
Palmolive, Dean Foods, Hipp GmbH & Co Vertrieb KG, Kraft Heinz, Johnson & Johnson, Molson Coors Brewing, mitzkan Holdings, Ltd.
Nestle company Pepsi
P & G, Puig S. L. , S. C.
Johnson & Johnson.
Scott\'s company, Spectrum brand Group Co. , Ltd.
Affiliated entities including United Industries Corporation and UnileverV. We have multi-
Reach annual supply arrangements with many of our customers in the US.
Outside of the US, closing business has been going on for a long time
Establish long-term relationships with most customers.
We have multiple
Reaching annual supply arrangements with some of our closed customers outside the US is a common practice, and many supply arrangements with customers outside the US are negotiated within one yearby-year basis.
In addition, we license our technology to five other manufacturers supplying products in India, Israel, South Korea, Malaysia, Maldives, South Africa, Sri Lanka, Taiwan and Thailand.
We are one of the leading manufacturers of custom design and stock plastic containers in various markets in North America, including the markets for personal care, food, healthcare, home and industrial chemicals.
We are also the leading manufacturer of plastic thermoforming barrier and non-forming barrier in North America
Barrier bowl and tray for shelves
Stable food and pet food.
We sell our plastic containers in most parts of North America through direct sales staff and a huge dealer network.
We also sell certain plastic containers in stock online.
Online shopping catalogue.
The largest customers of our plastic container business include Bayer, Berlin Packaging Co. , Ltd. , Campbell, General Mills
Hangao Co. , Ltd.
KGaA, Johnson & Johnson, Kraft Heinz, Mars, Incorporated mick & Company, Inc.
Perrigo, P & G, Scotland, tree house food
, TricorBraun, Inc. and Vi-
Jon Labs Ltd.
We have arranged for some of our plastic containers to be sold to the dealer, who in turn resell the products primarily to regional customers.
Plastic containers sold to dealers are usually manufactured using general purpose and custom molds, and decorations are added to meet the requirements of end users.
The dealer\'s warehouse and their sales staff enable us to sell and stock a wide variety of such products to a wide range of customers. We have multi-
Reach an annual supply arrangement with most customers for our plastic container business.
In addition, many of our supply arrangements with our customers are custom plastic containers made of proprietary molds.
Fierce competition in the packaging industry.
We compete in this industry with manufacturers of similar and other types of packaging, as well as packing, food processors and Packers who make containers for their own use and sale to others.
We try to compete effectively through product quality, competitive prices and the ability to meet customer delivery, performance and technical assistance requirements.
Manufacturers of commercial metal containers of c ontainer B USINESS, M et al, ADA Group, ball Metalpack Co. , Ltd. and Crown Holding Co. , Ltd.
Our most important competitor.
Our competitors include other regional suppliers.
As an alternative to purchasing containers from commercial tank manufacturers, customers have the ability to invest in equipment
Make their containers
Due to the high cost of transporting empty containers, our metal container business is usually sold to customers within a 300 mile radius of its manufacturing plant.
Strategically positioning the existing plant gives us an edge over our competitors in other regions, but we may be disadvantaged by the relocation of a major customer.
While metal containers are facing competition from plastic, paper, glass and composite containers, we believe that metal containers are superior in application to plastic, composite containers and paper containers, in the case of high temperature preparation or packaging in a larger number of consumers or institutions, or in the case of a long period of time
While maintaining the quality of the product, the long-term storage of the product is desirable.
We also believe that metal containers are more popular than glass containers because metal containers are more durable and cost less to transport.
In addition, the metal container is one of the most recyclable packaging in the world, which can be recycled indefinitely.
Our closing business mainly competes with Albea beauty holding. A.
, AptarGroup, Inc.
Berry Global Group Ltd. bellica Holdings Ltd.
Closed Systems International Limited(
Part of Rank Group Limited)
Crown Holdings Ltd.
Global closed system, Mashiti group, Guala dispensing, MexicoA. de C. V. and Tecnocap S. p. A.
With our capabilities, we are able to manufacture a wide range of metal, plastic closures and distribution systems to ensure the quality and safety of the closures, as well as the country-of-the-
To complement our closed products and our geographical location, we believe that we have closed our needs for food, beverages, healthcare, gardens, personal care, home and beauty products.
Our plastic container business competes with many large plastic container manufacturers for personal care, food, healthcare, pharmaceutical, home and industrial chemicals, pet food and care, agricultural, automotive and marine chemical products.
These competitors include Alpha Packaging. , Alpla-
Wyke Alvin Lerner Limited
Amcor Limited KG, Berry Global Group Co. , Ltd.
Graham Packaging Company Consolidated Container Co. , Ltd. Cebal Americas (
Part of Rank Group Limited)
And Plastipak Holdings Limited
In addition to our quick response to customer design, development and technical support needs and our value,
In addition, with a diverse product line, we strive to stay up to date and to a certain extent anticipate innovations in resin composition and applications, as well as changes in plastic container and cap manufacturing technologies.
As of December 31, 2018, we have employed approximately 3,200 paid employees and 9,900 hourly employeestime basis.
As of that date, about 37% of our hourly factory staff in the United States and Canada are represented by various trade unions, and most of our hourly staff in Europe, Asia, trade unions or other labor organizations represent South and Central America.
In addition, Campbell provided us with approximately 120 full-time staff as of December 31, 2018
We rented a facility from Campbell on a time basis.
Our labor contract expires at different times between 2019 and 2022.
As of December 31, 2018, contracts covering approximately 12% hours of employees in the United States and Canada will expire on 2019.
We do not expect significant changes in our relationship with these unions.
We are bound by federal, foreign, state and local environmental laws and regulations.
In general, these laws and regulations limit the discharge of pollutants to the environment and set standards for the treatment, storage and disposal of solid and hazardous wastes.
We believe that we either comply with all the environmental laws and regulations currently applicable in all material respects, or operate in accordance with appropriate discrepancies, schedules under compliance orders, or similar arrangements.
In addition to the costs associated with regulatory compliance, we may be liable for so-called environmental damage associated with the disposal of hazardous substances in the past.
Persons who produce hazardous substances disposed of in sites allegedly having environmental problems, as well as owners of those premises and other categories of persons, pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980, claim for cleanup and damage to natural resources, or CERCLA, regardless of the fault or legality of the original disposition.
CERCLA and many similar state and foreign regulations may require the responsible party to be responsible for the full cost of cleaning up at a particular location, although the party may not have caused the whole problem.
Other national regulations may specify the ratio rather than joint liability.
The federal Environmental Protection Agency or state or foreign agency may also issue an order requiring the responsible party to take clearance or remedial action on site.
We are also subject to the Occupational Safety and Health Act and other federal, foreign, state and local laws that regulate noise exposure levels and other safety and health in our factory production areas