Silgan Holdings Announces a 24 Percent Increase in Second Quarter Earnings and Raises...

Silgan Holdings Announces a 24 Percent Increase in Second Quarter Earnings and Raises Full Year 2008 Estimate

STAMFORD, Conn.--(Business Wire)--
Silgan Holdings Inc. (Nasdaq:SLGN), a leading supplier of consumer
goods packaging products, today reported second quarter 2008 net
income of $33.3 million, or $0.87 per diluted share, as compared to
second quarter 2007 net income of $26.8 million, or $0.70 per diluted
share. Results for the second quarter of 2008 included pre-tax
rationalization charges of $2.7 million, or $0.05 per diluted share
net of tax. Results for the second quarter of 2007 included pre-tax
rationalization charges of $2.3 million, or $0.04 per diluted share
net of tax. A reconciliation of net income per diluted share to
"adjusted net income per diluted share," a Non-GAAP financial measure
used by the Company, which adjusts net income per diluted share for
certain items, can be found in Tables A and B at the back of this
press release.

"Each of our businesses outperformed the prior year in the second
quarter of 2008, resulting in a 24 percent increase in adjusted net
income per diluted share as compared to the second quarter of 2007.
This is particularly encouraging given the current macro-economic
conditions and the significant inflation in raw materials and other
input costs," said Tony Allott, President and CEO. "Our metal food
container business benefited from strong manufacturing performance and
effective cost management. Our closures business benefited from solid
unit volume growth, improved manufacturing efficiencies and cost
reductions largely related to the international restructuring
announced during the first quarter. Our plastic container business
benefited from a favorable mix of products sold and successfully
managed operating costs to offset soft market demand," continued Mr.
Allott. "In light of our year-to-date performance and despite
expectations of continued inflation, particularly in resin costs, as
well as the economic concerns we raised our full year earnings
estimate of adjusted net income per diluted share by $0.05 to a range
of $3.50 to $3.70," concluded Mr. Allott.

Net sales for the second quarter of 2008 were $735.3 million, an
increase of $51.7 million, or 7.6 percent, as compared to $683.6
million in the second quarter of 2007. This increase was primarily the
result of higher average selling prices across all businesses largely
attributable to the pass through of higher raw material and other
manufacturing costs and favorable foreign currency translation,
partially offset by lower unit volumes in the metal food and plastic
container businesses.

Income from operations for the second quarter of 2008 was $64.9
million, an increase of $6.4 million, or 10.9 percent, as compared to
$58.5 million for the second quarter of 2007, and operating margin
increased to 8.8 percent from 8.6 percent for the same periods. Income
from operations increased across all businesses in the second quarter
of 2008 as compared to the same period last year.

Interest and other debt expense for the second quarter of 2008 was
$14.8 million, a decrease of $2.1 million as compared to 2007. This
decrease was primarily due to lower market interest rates and higher
interest income attributable to the cash on hand during the quarter.

The Company's effective tax rate for the second quarter of 2008
was 33.6 percent as compared to 35.6 percent in the same period of
2007. The effective tax rate for the second quarter of 2008 benefited
from a $1.7 million tax credit relating to certain non-recurring state
tax incentives.

Metal Food Containers

Net sales of the metal food container business were $377.5 million
for the second quarter of 2008, an increase of $12.5 million, or 3.4
percent, as compared to $365.0 million in 2007. This increase was
primarily the result of higher average selling prices as a result of
the pass through of higher raw material and other manufacturing costs,
partially offset by lower unit volumes.

Income from operations of the metal food container business
increased $5.4 million in the second quarter of 2008 to $33.1 million
as compared to $27.7 million in the second quarter of 2007, and
operating margin increased to 8.8 percent from 7.6 percent over the
same periods. This increase was primarily the result of cost control
and manufacturing efficiencies, including the benefits from the
closing of the St. Paul, Minnesota and Stockton, California
manufacturing facilities, slightly offset by lower unit volumes. The
second quarters of 2008 and 2007 included rationalization charges of
$2.0 million and $2.1 million, respectively.

Plastic Containers

Net sales of the plastic container business were $166.9 million in
the second quarter of 2008, an increase of $9.7 million, or 6.2
percent, as compared to $157.2 million in the second quarter of 2007.
This increase was due to higher average selling prices as a result of
the pass through of higher raw material costs, a more favorable mix of
products sold and the impact of favorable foreign currency
translation, partially offset by lower unit volumes attributable to
generally soft market demand.

Income from operations in the plastic container business for the
second quarter of 2008 was $13.6 million, an increase of $1.2 million
as compared to $12.4 million in 2007, and operating margin increased
to 8.1 percent from 7.9 percent over the same periods. This increase
was attributable to a favorable mix of products sold, improved
manufacturing efficiencies and lower selling, general and
administrative costs, partially offset by inflation in manufacturing
and other costs and a decrease in unit volumes.

Closures

Net sales of the closures business were $190.9 million in the
second quarter of 2008, an increase of $29.5 million, or 18.3 percent,
as compared to $161.4 million in the second quarter of 2007. This
increase was primarily the result of favorable foreign currency
translation, higher average selling prices due to the pass through of
higher raw material costs and an increase in unit volumes, including
from recently acquired businesses.

Income from operations in the closures business for the second
quarter of 2008 increased $1.0 million to $21.8 million as compared to
$20.8 million in 2007, while operating margin decreased to 11.4
percent from 12.9 percent over the same periods. The increase in
income from operations was primarily due to unit volume increases,
partially offset by inflation in manufacturing and other costs. The
decrease in operating margin was a result of inflation in raw
materials and other costs, the inclusion of the recently acquired
Spanish and Brazilian operations and rationalization charges of $0.6
million recognized in the second quarter of 2008 related to the
streamlining of certain operations and consolidation of various
administrative positions in Europe.

Six Months

Net income for the first six months of 2008 was $54.5 million, or
$1.42 per diluted share, as compared to net income for the first six
months of 2007 of $55.3 million, or $1.45 per diluted share. Results
for the first six months of 2008 included rationalization charges of
$0.13 per diluted share net of tax, as compared with rationalization
charges of $0.06 per diluted share net of tax in the same period a
year ago. Adjusted net income per diluted share for the first six
months of 2008 was $1.55 versus $1.51 in the prior year period.

Net sales for the first six months of 2008 increased $80.7
million, or 6.0 percent, to $1.42 billion as compared to $1.33 billion
for the first six months of 2007. This increase was primarily due to
higher average selling prices resulting from the pass through of
inflation in raw material and other manufacturing costs, favorable
foreign currency translation and an increase in unit volumes in the
closures business, slightly offset by lower unit volumes in the metal
food and plastic containers businesses.

Income from operations for the first six months of 2008 was $114.8
million, a decrease of $5.8 million, or 4.8 percent, from the same
period in 2007. This decrease was a result of $4.0 million of higher
rationalization charges incurred in 2008, benefits realized in the
first quarter of 2007 due to the lagged pass through of declines in
resin costs in the plastic container business, higher depreciation
expense and inflation in manufacturing and other costs. These
decreases were partially offset by improved manufacturing efficiencies
and cost control across all businesses and management fee income of
$2.2 million recognized in the first quarter of 2008 from the
management of the Brazilian White Cap closures operations.
Rationalization charges in 2008 related to the shut down of the
Tarrant, Alabama metal food container manufacturing facility and the
Richmond, Virginia plastic container manufacturing facility and the
consolidation of certain activities and administrative positions
within our European closures operations.

Interest and other debt expense for the first six months of 2008
was $31.1 million, a decrease of $1.9 million as compared to the first
six months of 2007. This decrease was primarily attributable to lower
market interest rates and higher interest income attributable to the
cash on hand during 2008, partially offset by the effects of higher
average borrowings.

The Company's effective tax rate for the first six months of 2008
was 34.9 percent as compared to 36.9 percent in the same period of
2007. The 2008 effective tax rate benefited from a $1.7 million tax
credit relating to certain non-recurring state tax incentives.

Dividend

On June 13, 2008 the Company paid a quarterly cash dividend in the
amount of $0.17 per share to holders of record of common stock of the
Company on May 30, 2008. This dividend payment aggregated $6.5
million.

Outlook for 2008

Despite the expectation of additional cost inflation and continued
concerns over the macro-economic environment, the Company is raising
its estimate of adjusted net income per diluted share for the full
year of 2008 to a range of $3.50 to $3.70. This estimate excludes
rationalization charges for previously announced plans, currently
estimated at $0.16 per diluted share, and the impact of potential
rationalization actions which the Company currently has under review.

The Company is providing an estimate of adjusted net income per
diluted share for the third quarter of 2008, which excludes
rationalization charges, in the range of $1.40 to $1.50, as compared
to adjusted net income per diluted share of $1.26 in the third quarter
of 2007.

Conference Call

Silgan Holdings Inc. will hold a conference call to discuss the
Company's results for the second quarter of 2008 at 11:00 a.m. eastern
time on July 23, 2008. The toll free number for domestic callers is
(888) 259-8724, and the number for international callers is (913)
312-0964. For those unable to listen to the live call, a taped
rebroadcast will be available through August 6, 2008. To access the
rebroadcast, the toll free number for domestic callers is (888)
203-1112, and the number for international callers is (719) 457-0820.
The pass code is 3853407.

Silgan Holdings is a leading manufacturer of consumer goods
packaging products with annual net sales of approximately $2.9 billion
in 2007. Silgan operates 69 manufacturing facilities in North and
South America, Europe and Asia. In North America, the Company is the
largest supplier of metal containers for food products and a leading
supplier of plastic containers for personal care products. In
addition, Silgan is a leading worldwide supplier of metal, composite
and plastic vacuum closures for food and beverage products.

Statements included in this press release which are not historical
facts are forward looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995 and
the Securities Exchange Act of 1934. Such forward looking statements
are made based upon management's expectations and beliefs concerning
future events impacting the Company and therefore involve a number of
uncertainties and risks, including, but not limited to, those
described in the Company's Annual Report on Form 10-K for 2007 and
other filings with the Securities and Exchange Commission. Therefore,
the actual results of operations or financial condition of the Company
could differ materially from those expressed or implied in such
forward looking statements.

-0-
*T
SILGAN HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
For the quarter and six months ended June 30,
(Dollars in millions, except per share amounts)

Second Quarter Six Months
----------------- -----------------
2008 2007 2008 2007
-------- -------- -------- --------

Net sales $ 735.3 $ 683.6 $1,415.1 $1,334.4

Cost of goods sold 627.3 584.3 1,217.0 1,135.1
-------- -------- -------- --------

Gross profit 108.0 99.3 198.1 199.3

Selling, general and administrative
expenses 40.4 38.5 75.9 75.3

Rationalization charges 2.7 2.3 7.4 3.4
-------- -------- -------- --------

Income from operations 64.9 58.5 114.8 120.6

Interest and other debt expense 14.8 16.9 31.1 33.0
-------- -------- -------- --------

Income before income taxes 50.1 41.6 83.7 87.6

Provision for income taxes 16.8 14.8 29.2 32.3
-------- -------- -------- --------

Net income $ 33.3 $ 26.8 $ 54.5 $ 55.3
======== ======== ======== ========

Earnings per share:
Basic net income per share $ 0.88 $ 0.71 $ 1.44 $ 1.47
Diluted net income per share $ 0.87 $ 0.70 $ 1.42 $ 1.45

Cash dividends per common share $ 0.17 $ 0.16 $ 0.34 $ 0.32

Weighted average shares (000's):
Basic 37,851 37,654 37,812 37,634
Diluted 38,269 38,162 38,239 38,134
*T

-0-
*T
SILGAN HOLDINGS INC.
CONSOLIDATED SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
For the quarter and six months ended June 30,
(Dollars in millions)

Second Quarter Six Months
------------------- -------------------
2008 2007 2008 2007
--------- --------- --------- ---------

Net sales:
Metal food containers $ 377.5 $ 365.0 $ 728.7 $ 710.6
Plastic containers 166.9 157.2 339.0 319.6
Closures 190.9 161.4 347.4 304.2
--------- --------- --------- ---------
Consolidated $ 735.3 $ 683.6 $1,415.1 $1,334.4
========= ========= ========= =========

Income from operations:
Metal food containers (a) $ 33.1 $ 27.7 $ 58.2 $ 56.5
Plastic containers (b) 13.6 12.4 26.2 32.2
Closures (c) 21.8 20.8 36.3 36.6
Corporate (3.6) (2.4) (5.9) (4.7)
--------- --------- --------- ---------
Consolidated $ 64.9 $ 58.5 $ 114.8 $ 120.6
========= ========= ========= =========
*T

-0-
*T
SILGAN HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in millions)

June 30, June 30, Dec. 31,
2008 2007 2007
-------- -------- --------

Assets:
Cash and cash equivalents $ 86.1 $ 25.3 $ 95.9
Trade accounts receivable, net 346.2 320.3 219.8
Inventories 576.1 548.3 427.8
Other current assets 30.2 32.8 27.7
Property, plant and equipment, net 940.3 913.3 939.6
Other assets, net 449.3 419.0 429.2
-------- -------- --------
Total assets $2,428.2 $2,259.0 $2,140.0
======== ======== ========

Liabilities and stockholders' equity:
Current liabilities, excluding debt $ 385.3 $ 341.1 $ 378.0
Current and long-term debt 1,214.6 1,204.3 992.5
Other liabilities 271.3 290.0 269.4
Stockholders' equity 557.0 423.6 500.1
-------- -------- --------
Total liabilities and stockholders'
equity $2,428.2 $2,259.0 $2,140.0
======== ======== ========

(a) Includes rationalization charges of $2.0 million and $2.1
million for the three months ended June 30, 2008 and 2007,
respectively, and $3.3 million and $3.2 million for the six
months ended June 30, 2008 and 2007, respectively.
(b) Includes rationalization charges of $0.1 million and $0.2
million for the three months ended June 30, 2008 and 2007,
respectively, and $0.8 million and $0.2 million for the six
months ended June 30, 2008 and 2007, respectively.
(c) Includes rationalization charges of $0.6 million and $3.3
million for the three and six months ended June 30, 2008,
respectively.
*T

-0-
*T
SILGAN HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For the six months ended June 30,
(Dollars in millions)

2008 2007
-------- --------

Cash flows provided by (used in) operating
activities:
Net income $ 54.5 $ 55.3
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization 71.5 66.8
Rationalization charges 7.4 3.4
Other changes that provided (used) cash, net of
effects from acquisitions:
Trade accounts receivable, net (119.1) (82.6)
Inventories (131.4) (117.3)
Trade accounts payable and other changes, net 73.1 36.5
-------- --------
Net cash used in operating activities (44.0) (37.9)
-------- --------

Cash flows provided by (used in) investing
activities:
Purchases of businesses, net of cash acquired (14.5) (7.8)
Capital expenditures (55.4) (75.4)
Proceeds from asset sales 0.9 2.5
-------- --------
Net cash used in investing activities (69.0) (80.7)
-------- --------

Cash flows provided by (used in) financing
activities:
Dividends paid on common stock (13.0) (12.1)
Net borrowings and other financing activities 116.2 139.3
-------- --------
Net cash provided by financing activities 103.2 127.2
-------- --------

Cash and cash equivalents:
Net (decrease) increase (9.8) 8.6
Balance at beginning of year 95.9 16.7
-------- --------
Balance at end of period $ 86.1 $ 25.3
======== ========
*T

-0-
*T
SILGAN HOLDINGS INC.
RECONCILIATION OF ADJUSTED NET INCOME PER DILUTED SHARE (1)
(UNAUDITED)
For the quarter and six months ended June 30,

Table A
----------------------------------------------------------------------

Second Six Months
Quarter
----------- -----------
2008 2007 2008 2007
----- ----- ----- -----

Net income per diluted share as reported $0.87 $0.70 $1.42 $1.45

Adjustments:
Rationalization charges, net of tax 0.05 0.04 0.13 0.06
----- ----- ----- -----

Adjusted net income per diluted share $0.92 $0.74 $1.55 $1.51
===== ===== ===== =====
*T

-0-
*T
SILGAN HOLDINGS INC.
RECONCILIATION OF ADJUSTED NET INCOME PER DILUTED SHARE (1)
(UNAUDITED)
For the quarter and year ended,

Table B
----------------------------------------------------------------------

Third Quarter Year Ended
------------------ ------------------
September 30, December 31,
------------------ ------------------
Estimated Actual Estimated Actual
----------- ------ ----------- ------
Low High Low High
2008 2008 2007 2008 2008 2007
----- ----- ------ ----- ----- ------

Net income per diluted share as
estimated for 2008 and as
reported for 2007 $1.38 $1.48 $1.25 $3.34 $3.54 $3.22

Adjustments:
Rationalization charges,
net of tax 0.02 0.02 0.01 0.16 0.16 0.10
----- ----- ------ ----- ----- ------
Adjusted net income per diluted
share as estimated for 2008 and
presented for 2007 $1.40 $1.50 $1.26 $3.50 $3.70 $3.32
===== ===== ====== ===== ===== ======
*T

(1) The Company has presented adjusted net income per diluted
share for the periods covered by this press release, which measure is
a Non-GAAP financial measure. The Company's management believes it is
useful to exclude rationalization charges from its net income per
diluted share as calculated under U.S. generally accepted accounting
principles because such Non-GAAP financial measure allows for a more
appropriate evaluation of its operating results. While rationalization
costs are incurred on a regular basis, management views these costs
more as an investment to generate savings rather than period costs.
Such Non-GAAP financial measure is not in accordance with U.S.
generally accepted accounting principles and should not be considered
in isolation but should be read in conjunction with the unaudited
condensed consolidated statements of income and the other information
presented herein. Additionally, such Non-GAAP financial measure should
not be considered a substitute for net income per diluted share as
calculated under U.S. generally accepted accounting principles and may
not be comparable to similarly titled measures of other companies.

Silgan Holdings Inc.
Robert B. Lewis, 203-406-3160

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