EXHIBIT 99.1
Published on January 29, 2009
Exhibit 99.1
 |
|
News
Release
|
|
For
Immediate Release
|
http://www.ball.com
|
|
|
Investor
Contact:
|
Ann
T. Scott
|
303-460-3537,
ascott@ball.com
|
|
Media
Contact:
|
Scott
McCarty
|
303-460-2103,
smccarty@ball.com
|
Ball
Announces 2008 Fourth Quarter, Full-Year Results
BROOMFIELD,
Colo., Jan. 29, 2009—Ball Corporation [NYSE:BLL] today reported full-year 2008
net earnings of $319.5 million, or
$3.29 per diluted share, on sales of $7.56 billion, compared to $281.3 million,
or $2.74 per diluted share, on sales of $7.39 billion in 2007.
Fourth
quarter 2008 net earnings were $33.8 million, or 36
cents per diluted share, on sales of $1.73 billion, compared to $33.3 million,
or 33 cents per diluted share, on sales of $1.76 billion in the fourth quarter
of 2007.
In
both 2008 and 2007, results included costs from business consolidation
activities and other non-operating items. Fourth quarter net earnings
included net after-tax costs of $19.6 million, or 20 cents per diluted share,
and $27 million, or 27 cents per diluted share, for 2008 and 2007, respectively.
Year-to-date results included net after-tax costs of $30.5 million, or 32 cents
per diluted share, and $78.8 million, or 76 cents per diluted share, for 2008
and 2007, respectively. The fourth quarter 2008 charge was primarily for the
previously announced closure of metal beverage packaging plants in Kansas City,
Mo., and Guayama, Puerto Rico.
Details
of the business consolidation activities and comparable segment earnings can be
found in Notes 1 and 2 to the unaudited consolidated financial
statements that accompany this news release.
“Ball’s
diluted earnings per share, net sales and net earnings for the full year all
increased during one of the most challenging global economic environments in
decades,” said R. David Hoover, chairman, president and chief executive officer.
“Our metal food and household products packaging and aerospace segments led our
improved performance, but a higher fourth quarter tax rate caused by the broad
stock market decline and its impact on certain employee benefits plans hurt our
results in the quarter by four cents per diluted
share.”
- more
- -
Ball
Corporation
10 Longs
Peak Drive · P.O. Box
5000 · Broomfield, CO
80021
Ball Corp
- - 2
“The
wider economic downturn in 2008 prompted us to accelerate ongoing changes within
Ball,” said John A. Hayes, executive vice president and chief operating officer.
“As a result, we are poised to further improve operating performance due to
effectively managing our asset base, aligning with successful customers and
focusing on the execution of our long-term strategy.”
Metal
Beverage Packaging, Americas & Asia
Metal
beverage packaging, Americas and Asia, comparable segment operating earnings
were $284.1 million in 2008 on sales of $2.99 billion, compared to $326.4
million in 2007 on sales of $3.1 billion. For the fourth quarter, comparable
earnings were $55.7 million on sales of $684.7 million in 2008, compared to
$64.2 million on sales of $728.1 million in 2007. Fourth quarter results were
lower primarily due to reduced North American sales volumes and curtailed
production for inventory control purposes. Full year results were lower due to a
$52 million inventory holding gain in 2007 that did not reoccur in
2008.
During
the year Ball announced the closure of three metal beverage packaging plants to
further balance the company’s capacity in this segment with market changes. Cost
reductions associated with these plant closings are expected to exceed $30
million in 2009 and to be over $10 million cash positive upon final disposition
of the assets. In China, strong demand and an improved customer mix contributed
to improved results.
Metal
Beverage Packaging, Europe
Metal
beverage packaging, Europe, segment results in 2008 were operating earnings of
$230.9 million on sales of $1.87 billion, compared to $228.9 million on sales of
$1.65 billion in 2007. For the fourth quarter, operating earnings in 2008 were
$29.0 million on sales of $380.8 million, compared to $31.2 million on sales of
$393.9 million in the fourth quarter of 2007. The weakening of the euro against
the U.S. dollar and the weakening of the British pound sterling against the euro
reduced fourth quarter results compared to last year.
Ball
elected to slow the timing of announced new metal beverage packaging plants in
Poland and India, though the company expects some volume growth in 2009. Cost
savings measures continue to be implemented across the
business.
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- -
Ball
Corporation
10 Longs
Peak Drive · P.O. Box
5000 · Broomfield, CO
80021
Ball Corp
- - 3
Metal
Food & Household Products Packaging, Americas
Metal
food and household products packaging, Americas, comparable segment results for
2008 were operating earnings of $68.1 million on sales of $1.22 billion,
compared to $36.2 million in 2007 on sales of $1.18 billion. For the fourth
quarter of 2008, comparable segment results were operating earnings of $23.2
million on sales of $309.4 million, compared to $10.8 million on sales of $271.1
million in the same period of 2007.
Fourth
quarter results were higher than the same period in 2007 due primarily to a
longer and stronger than expected seasonal pack, better manufacturing
performance and the favorable resolution of a $6.8 million claim.
Plastic
Packaging, Americas
Plastic
packaging, Americas, comparable segment results for 2008 were operating earnings
of $15.8 million on sales of $735.4 million, compared to $26.3 million on sales
of $752.4 million in 2007. For the fourth quarter, the segment broke even on
sales of $161.4 million, compared to $9.2 million of comparable earnings on
sales of $172.1 million for the same period in 2007.
Fourth
quarter results were hurt by reduced sales volumes and curtailed production for
inventory control purposes. The company will continue to monitor demand trends,
given weaker volumes in 2008, to assess future supply and demand
balance.
Aerospace
and Technologies
Aerospace
and technologies comparable segment results were operating earnings of $76.2
million on sales of $746.5 million in 2008, compared to $64.6 million on sales
of $787.8 million in 2007. For the fourth quarter, earnings were $20.2 million
on sales of $196.5 million. Fourth quarter 2007 earnings were $11.1 million on
sales of $191 million. Backlog at the close of the year was $597.3
million.
Backlog
declined in this segment in part as a result of pressure on the U.S. federal
budget, the broader financial crisis and a slowdown in new contract awards
stemming from the effects of the presidential election year. Ball reduced
headcount and realigned resources to support its growing antenna and video
technologies and information services such as data exploitation, systems
engineering and technical support to defense and intelligence organizations.
While this segment is focused on increasing backlog levels, the company expects
2009 results to decline.
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- -
Ball
Corporation
10 Longs
Peak Drive · P.O. Box
5000 · Broomfield, CO
80021
Ball Corp
- - 4
Outlook
Ball
expects improved free cash flow in 2009 in the range of $375 million and
significantly lower interest expense due to lower debt levels and interest
rates. Though the company anticipates stronger free cash flow for the year, it
has elected to suspend its stock buyback program and delay capital spending for
certain plant projects until global economic conditions and capital markets
improve.
“Ball
has no significant debt refinancing requirements until October of 2011,” said
Raymond J. Seabrook, executive vice president and chief financial officer. “Our
company’s expected 2009 strong free cash flow will be used to increase
liquidity, reduce debt, continue dividend payments and improve financial
flexibility.”
“We
remain positive about long-term growth opportunities in our global beverage can
business, and we have responded prudently to the broader economic downturn by
slowing those projects with the exception of our new joint venture metal
beverage packaging plant in Brazil, where market demand requires additional
capacity,” Hoover said. “We reduced the manufacturing footprint of our North
American packaging businesses to better align supply with market demand and
implemented price increases in all of our packaging operating segments to
reflect the value delivered to our customers. Because of the disciplined actions
we took in 2008 and the defensive nature of our businesses in this economy, Ball
is well positioned to improve diluted earnings per share performance in
2009.”
Ball
Corporation is a supplier of high-quality metal and plastic packaging for
beverage, food and household products customers, and of aerospace and other
technologies and services, primarily for the U.S. government. Ball Corporation
and its subsidiaries employ more than 14,500 people worldwide and reported 2008
sales of more than $7.5 billion.
Conference Call
Details
Ball
Corporation [NYSE: BLL] will hold its quarterly conference call on the company’s
fourth quarter and full-year 2008 results and performance today at 10 a.m.
Eastern Time. The North American toll-free number for the call is 800-732-6870.
International callers should dial 212-231-2900. Please use the following URL for
a Web cast of the live call:
http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=115234&eventID=2055776
For those unable to listen to the live
call, a taped replay will be available after the call’s conclusion until noon
Eastern Time on Feb. 5, 2009. To access the replay, call 800-633-8284 (North
American callers) or 402-977-9140 (international callers) and use reservation
number 21406682.
A written
transcript of the call will be posted within 48 hours of the call's conclusion
to Ball's Web site at www.ball.com in the investors section under
"presentations.”
Forward-Looking
Statements
This
release contains “forward-looking” statements concerning future events and
financial performance. Words such as “expects,” “anticipates,” “estimates” and
similar expressions are intended to identify forward-looking statements. Such
statements are subject to risks and uncertainties which could cause actual
results to differ materially from those expressed or implied. The company
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
Key risks and uncertainties are summarized in filings with the Securities and
Exchange Commission, including Exhibit 99.2 in our Form 10-K, which are
available at our Web site and at www.sec.gov. Factors
that might affect our packaging segments include fluctuation in product demand
and preferences; availability and cost of raw materials; competitive packaging
availability, pricing and substitution; changes in climate and weather; crop
yields; competitive activity; failure to achieve anticipated productivity
improvements or production cost reductions, including our beverage can end
project; mandatory deposit or other restrictive packaging laws; changes in major
customer or supplier contracts or loss of a major customer or supplier; and
changes in foreign exchange rates, tax rates and activities of foreign
subsidiaries. Factors that might affect our aerospace segment include: funding,
authorization, availability and returns of government and commercial contracts;
and delays, extensions and technical uncertainties affecting segment contracts.
Factors that might affect the company as a whole include those listed plus:
accounting changes; changes in senior management; the current global credit
squeeze and its effects on liquidity, credit risk, asset values and the economy;
successful or unsuccessful acquisitions, joint
ventures or divestitures; integration of recently acquired businesses;
regulatory action or laws including tax, environmental, health and workplace
safety, including in respect of chemicals or substances used in raw materials or
in the manufacturing process; governmental investigations; technological
developments and innovations; goodwill impairment; antitrust, patent and other
litigation; strikes; labor cost changes; rates of return projected and earned on
assets of the company’s defined benefit retirement plans; pension changes;
reduced cash flow; interest rates affecting our debt; and changes to unaudited
results due to statutory audits or other effects.
# #
#
Ball
Corporation
10 Longs
Peak Drive · P.O. Box
5000 · Broomfield, CO
80021
|
Condensed
Financials (December
2008)
|
||||||||||||||||
|
Unaudited
Statements of Consolidated Earnings
|
||||||||||||||||
|
Three
months ended
|
Year
ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
($
in millions, except per share amounts)
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Sales
|
$ | 1,732.8 | $ | 1,756.2 | $ | 7,561.5 | $ | 7,475.3 | ||||||||
|
Legal
settlement (Note 2)
|
– | – | – | (85.6 | ) | |||||||||||
|
Net sales
|
1,732.8 | 1,756.2 | 7,561.5 | 7,389.7 | ||||||||||||
|
Costs
and expenses
|
||||||||||||||||
|
Cost of sales (excluding
depreciation and amortization)
|
1,484.3 | 1,490.1 | 6,340.4 | 6,226.5 | ||||||||||||
|
Depreciation and
amortization
|
72.7 | 74.3 | 297.4 | 281.0 | ||||||||||||
|
Selling, general and
administrative
|
60.6 | 69.9 | 288.2 | 323.7 | ||||||||||||
|
Business consolidation and
other costs (Note 2)
|
31.5 | 44.6 | 52.1 | 44.6 | ||||||||||||
|
Gain on sale of subsidiary
(Note 2)
|
– | – | (7.1 | ) | – | |||||||||||
| 1,649.1 | 1,678.9 | 6,971.0 | 6,875.8 | |||||||||||||
|
Earnings before interest and
taxes (Note 1)
|
83.7 | 77.3 | 590.5 | 513.9 | ||||||||||||
|
Interest
expense
|
(33.7 | ) | (37.2 | ) | (137.7 | ) | (149.4 | ) | ||||||||
|
Tax
provision
|
(19.0 | ) | (9.8 | ) | (147.4 | ) | (95.7 | ) | ||||||||
|
Minority
interests
|
(0.1 | ) | (0.1 | ) | (0.4 | ) | (0.4 | ) | ||||||||
|
Equity
in results of affiliates
|
2.9 | 3.1 | 14.5 | 12.9 | ||||||||||||
|
Net
earnings
|
$ | 33.8 | $ | 33.3 | $ | 319.5 | $ | 281.3 | ||||||||
|
Earnings per share
(Note 2):
|
||||||||||||||||
|
Basic
|
$ | 0.36 | $ | 0.33 | $ | 3.33 | $ | 2.78 | ||||||||
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Diluted
|
$ | 0.36 | $ | 0.33 | $ | 3.29 | $ | 2.74 | ||||||||
|
Weighted
average shares outstanding (000s):
|
||||||||||||||||
|
Basic
|
94,022 | 99,688 | 95,857 | 101,186 | ||||||||||||
|
Diluted
|
95,019 | 101,219 | 97,019 | 102,760 | ||||||||||||
|
Condensed
Financials (December
2008)
|
||||||||||||||||
|
Unaudited
Statements of Consolidated Cash Flows
|
||||||||||||||||
|
Three
months ended
|
Year
ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
($
in millions)
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Cash
Flows From Operating Activities:
|
||||||||||||||||
|
Net earnings
|
$ | 33.8 | $ | 33.3 | $ | 319.5 | $ | 281.3 | ||||||||
|
Depreciation and
amortization
|
72.7 | 74.3 | 297.4 | 281.0 | ||||||||||||
|
Business consolidation and
other costs
|
31.5 | 42.3 | 52.1 | 42.3 | ||||||||||||
|
Income taxes
|
11.4 | (13.9 | ) | 27.1 | 14.9 | |||||||||||
|
Legal
settlement
|
– | – | (70.3 | ) | 85.6 | |||||||||||
|
Incremental pension funding,
net of taxes
|
– | (27.3 | ) | – | (27.3 | ) | ||||||||||
|
Other changes in working
capital
|
332.7 | 172.6 | (16.8 | ) | (18.4 | ) | ||||||||||
|
Other
|
7.1 | (13.5 | ) | 18.6 | 13.6 | |||||||||||
| 489.2 | 267.8 | 627.6 | 673.0 | |||||||||||||
|
Cash
Flows From Investing Activities:
|
||||||||||||||||
|
Additions to property, plant
and equipment
|
(76.1 | ) | (85.6 | ) | (306.9 | ) | (308.5 | ) | ||||||||
|
Cash collateral deposits, net
(Note 3)
|
(105.5 | ) | – | (105.5 | ) | – | ||||||||||
|
Proceeds from sale of
subsidiary
|
– | – | 8.7 | – | ||||||||||||
|
Property insurance
proceeds
|
– | – | – | 48.6 | ||||||||||||
|
Other
|
(24.1 | ) | (0.5 | ) | (14.3 | ) | (5.9 | ) | ||||||||
| (205.7 | ) | (86.1 | ) | (418.0 | ) | (265.8 | ) | |||||||||
|
Cash
Flows From Financing Activities:
|
||||||||||||||||
|
Net change in
borrowings
|
(188.8 | ) | (48.4 | ) | 127.3 | (170.0 | ) | |||||||||
|
Dividends
|
(9.2 | ) | (10.2 | ) | (37.5 | ) | (40.6 | ) | ||||||||
|
Purchases of common stock,
net
|
(42.1 | ) | (56.2 | ) | (299.6 | ) | (211.3 | ) | ||||||||
|
Other
|
0.8 | 1.2 | 4.3 | 9.5 | ||||||||||||
| (239.3 | ) | (113.6 | ) | (205.5 | ) | (412.4 | ) | |||||||||
|
Effect
of exchange rate changes on cash
|
(30.7 | ) | 4.1 | (28.3 | ) | 5.3 | ||||||||||
|
Change
in cash
|
13.5 | 72.2 | (24.2 | ) | 0.1 | |||||||||||
|
Cash–beginning
of period
|
113.9 | 79.4 | 151.6 | 151.5 | ||||||||||||
|
Cash–end
of period
|
$ | 127.4 | $ | 151.6 | $ | 127.4 | $ | 151.6 | ||||||||
|
Condensed
Financials (December
2008)
|
||||||||
|
Unaudited
Consolidated Balance Sheets
|
||||||||
|
December
31,
|
December
31,
|
|||||||
|
($
in millions)
|
2008
|
2007
|
||||||
|
Assets
|
||||||||
|
Current
assets
|
||||||||
|
Cash and cash
equivalents
|
$ | 127.4 | $ | 151.6 | ||||
|
Receivables,
net
|
507.9 | 582.7 | ||||||
|
Inventories,
net
|
974.2 | 998.1 | ||||||
|
Cash collateral – receivable
(Note 3)
|
229.5 | – | ||||||
|
Deferred taxes and other
current assets
|
326.3 | 110.5 | ||||||
|
Total current
assets
|
2,165.3 | 1,842.9 | ||||||
|
Property,
plant and equipment, net
|
1,866.9 | 1,941.2 | ||||||
|
Goodwill
|
1,825.5 | 1,863.1 | ||||||
|
Other
assets, net
|
511.0 | 373.4 | ||||||
|
Total assets
|
$ | 6,368.7 | $ | 6,020.6 | ||||
|
Liabilities
and Shareholders’ Equity
|
||||||||
|
Current
liabilities
|
||||||||
|
Short-term debt and current
portion of long-term debt
|
$ | 303.0 | $ | 176.8 | ||||
|
Cash collateral – liability
(Note 3)
|
124.0 | – | ||||||
|
Payables and other accrued
liabilities
|
1,435.4 | 1,336.3 | ||||||
|
Total current
liabilities
|
1,862.4 | 1,513.1 | ||||||
|
Long-term
debt
|
2,107.1 | 2,181.8 | ||||||
|
Other
liabilities and minority interests
|
1,313.4 | 983.2 | ||||||
|
Shareholders’
equity
|
1,085.8 | 1,342.5 | ||||||
|
Total liabilities and
shareholders’ equity
|
$ | 6,368.7 | $ | 6,020.6 | ||||
|
Unaudited
Notes to Condensed Financials (December
2008)
|
||||||||||||||||
|
1. Business Segment
Information
Due
to first quarter 2008 management reporting changes, Ball’s China
operations are included in the metal beverage packaging, Americas and
Asia, segment. The results for the 2007 periods have been retrospectively
adjusted to conform to the current year presentation.
|
||||||||||||||||
|
Three
months ended
|
Year
ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
($
in millions)
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Sales–
|
||||||||||||||||
|
Metal beverage packaging,
Americas & Asia
|
$ | 684.7 | $ | 728.1 | $ | 2,989.5 | $ | 3,098.1 | ||||||||
|
Legal settlement
(Note 2)
|
– | – | – | (85.6 | ) | |||||||||||
|
Total metal beverage
packaging, Americas & Asia
|
684.7 | 728.1 | 2,989.5 | 3,012.5 | ||||||||||||
|
Metal beverage packaging,
Europe
|
380.8 | 393.9 | 1,868.7 | 1,653.6 | ||||||||||||
|
Metal food & household
packaging, Americas
|
309.4 | 271.1 | 1,221.4 | 1,183.4 | ||||||||||||
|
Plastic packaging,
Americas
|
161.4 | 172.1 | 735.4 | 752.4 | ||||||||||||
|
Aerospace &
technologies
|
196.5 | 191.0 | 746.5 | 787.8 | ||||||||||||
|
Consolidated net
sales
|
$ | 1,732.8 | $ | 1,756.2 | $ | 7,561.5 | $ | 7,389.7 | ||||||||
|
Earnings
before interest and taxes–
|
||||||||||||||||
|
Metal beverage packaging,
Americas & Asia
|
$ | 55.7 | $ | 64.2 | $ | 284.1 | $ | 326.4 | ||||||||
|
Business consolidation and
other costs (Note 2)
|
(36.6 | ) | – | (40.6 | ) | (85.6 | ) | |||||||||
|
Total
metal beverage packaging, Americas & Asia
|
19.1 | 64.2 | 243.5 | 240.8 | ||||||||||||
|
Metal
beverage packaging, Europe
|
29.0 | 31.2 | 230.9 | 228.9 | ||||||||||||
|
Metal food & household
packaging, Americas
|
23.2 | 10.8 | 68.1 | 36.2 | ||||||||||||
|
Business consolidation costs
(Note 2)
|
6.1 | (44.2 | ) | 1.6 | (44.2 | ) | ||||||||||
|
Total metal food &
household packaging, Americas
|
29.3 | (33.4 | ) | 69.7 | (8.0 | ) | ||||||||||
|
Plastic packaging,
Americas
|
– | 9.2 | 15.8 | 26.3 | ||||||||||||
|
Business consolidation costs
(Note 2)
|
– | (0.4 | ) | (8.3 | ) | (0.4 | ) | |||||||||
|
Total plastic packaging,
Americas
|
– | 8.8 | 7.5 | 25.9 | ||||||||||||
|
Aerospace &
technologies
|
20.2 | 11.1 | 76.2 | 64.6 | ||||||||||||
|
Gain on sale of subsidiary
(Note 2)
|
– | – | 7.1 | – | ||||||||||||
|
Total aerospace &
technologies
|
20.2 | 11.1 | 83.3 | 64.6 | ||||||||||||
|
Segment earnings before
interest and taxes
|
97.6 | 81.9 | 634.9 | 552.2 | ||||||||||||
|
Undistributed corporate
costs
|
(12.9 | ) | (4.6 | ) | (39.6 | ) | (38.3 | ) | ||||||||
|
Business consolidation and
other costs (Note 2)
|
(1.0 | ) | – | (4.8 | ) | – | ||||||||||
|
Total undistributed corporate
costs
|
(13.9 | ) | (4.6 | ) | (44.4 | ) | (38.3 | ) | ||||||||
|
Earnings before interest and
taxes
|
$ | 83.7 | $ | 77.3 | $ | 590.5 | $ | 513.9 | ||||||||
|
Unaudited
Notes to Condensed Financials (December
2008)
|
|
2.
|
Business
Consolidation Activities and Other Significant Nonoperating
Items
|
2008
On
October 30, 2008, the company announced the closure of two North American
metal beverage can plants. A $41.7 million ($25.8 million after tax)
business consolidation charge was recorded in the fourth quarter, primarily for
employee severance costs, accelerated depreciation and the write down of assets
to net realizable value. A gain of $10.2 million ($6.2 million after
tax) was also recorded to reflect the recovery of business consolidation costs
previously expensed. An additional $3 million after-tax charge is expected
to be recorded in the first quarter of 2009 related to these plant closings.
Cost reductions associated with these plant closings could be up to
$30 million in 2009 and, inclusive of tax benefits, be $7 million cash
positive upon final disposition of the assets.
In prior
quarters, $20.6 million ($15.3 million after tax) was recorded for
business consolidation activities primarily for the closure of two manufacturing
facilities, a metal beverage packaging plant in Kent, Wash., and a plastic
packaging plant in Brampton, Ontario. Also Ball Aerospace completed the sale of
a subsidiary for $10.5 million that resulted in a pretax gain of
$7.1 million ($4.4 million after tax).
2007
A
business consolidation charge of $44.6 million ($27 million after tax)
was recorded in the fourth quarter, primarily related to the announced closure
of two food and household products packaging facilities. The closure of the
company's facilities in Tallapoosa, Ga., and Commerce, Calif., resulted in a net
reduction in manufacturing capacity of 10 production lines, including the
relocation of two high-speed aerosol lines into existing Ball
facilities.
In a
prior quarter, the company settled a dispute with a U.S. customer in mediation
for various claims for $85.6 million ($51.8 million after tax). The
customer received a one-time payment of approximately $70 million in
January 2008 with the remainder of the settlement to be recovered over the life
of the supply contract with that customer through 2015.
A
summary of the effects of the above transactions on after-tax earnings
follows:
|
Three
months ended
|
Year
ended
|
|||||||||||||||
|
December
31,
|
December
31,
|
|||||||||||||||
|
($
in millions, except per share amounts)
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Net
earnings as reported
|
$ | 33.8 | $ | 33.3 | $ | 319.5 | $ | 281.3 | ||||||||
|
Business
consolidation and other costs, net of tax
|
19.6 | 27.0 | 34.9 | 27.0 | ||||||||||||
|
Gain
on sale of subsidiary, net of tax
|
– | – | (4.4 | ) | – | |||||||||||
|
Legal
settlement, net of tax
|
– | – | – | 51.8 | ||||||||||||
|
Net earnings before above
transactions
|
$ | 53.4 | $ | 60.3 | $ | 350.0 | $ | 360.1 | ||||||||
|
Per
diluted share before above transactions
|
$ | 0.56 | $ | 0.60 | $ | 3.61 | $ | 3.50 | ||||||||
Ball’s
management segregates the above items to evaluate the performance of the
company’s operations. The information is presented on a non-U.S. GAAP basis and
should be considered in connection with the unaudited statements of consolidated
earnings. Non-U.S. GAAP measures should not be considered in
isolation.
|
Unaudited
Notes to Condensed Financials (December
2008)
|
|
3.
|
Cash
Collateral Deposits
|
In the
fourth quarter of 2008, $105.5 million of net interest bearing cash
collateral deposits were made on aluminum derivative hedging contracts. As these
derivative hedging contracts are matched to customer sales contracts, they have
little or no economic impact on our earnings but reduce aluminum price
volatility for our customers. Terms of these derivative contracts may require
Ball to post collateral in certain circumstances when the negative
mark-to-market value of these contracts exceeds specified levels. Additionally,
Ball has similar collateral posting arrangements with certain customers and
financial counterparties on these hedging contracts. At December 31, 2008,
Ball had $229.5 million of cash posted as collateral and had received
$124 million of cash from customers for a net amount of
$105.5 million. Assuming aluminum prices remain unchanged, we would expect
to recover all of these cash deposits in 2009.