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Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2024-11-07 · 62 added, 123 removed, 150 unchanged (55% of the section changed)

12 unchanged sentences

If acquisition opportunities are not identified over a longer period of time, we may use our cash flow to repay debt, repurchase shares of our common stock or increase dividends to our stockholders or for other permitted purposes.

In October 2024, we acquired Weener Plastics Holding B.V., or Weener Packaging.

Weener Packaging's results of operations are included in our dispensing and specialty closures segment.

RESULTS OF OPERATIONS

The following table sets forth certain unaudited income statement data expressed as a percentage of net sales for the periods presented:

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

The following table sets forth certain unaudited income statement data expressed as a percentage of net sales for the three months ended March 31:

Dispensing and Specialty Closures 45.8 % 40.7 %

6 unchanged sentences

Rationalization charges 0.7 0.9

Other pension and postretirement expense (income) — 0.1 — 0.1

Other pension and postretirement income — —

Income before interest and income taxes 8.9 8.5

2 unchanged sentences

Provision for income taxes 1.4 1.4

Income before equity in earnings of affiliates 4.5 4.2

Equity in earnings of affiliates, net of tax 0.1 —

Net income 4.6 % 4.2 %

Summary unaudited results of operations for the periods presented are provided below.

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

Summary unaudited results of operations for the three months ended March 31 are provided below.

(dollars in millions)

9 unchanged sentences

Consolidated $ 130.5 $ 111.7

In the third quarter of 2024, consolidated net sales were $1.75 billion, a decrease of $58.0 million, or 3.2 percent, as compared to the third quarter of 2023 primarily due to the unfavorable impact from the pass through of lower raw material costs in the dispensing and specialty closures and metal containers segments, a less favorable mix of products sold in the metal containers segment and lower volumes in the dispensing and specialty closures segment.

These decreases were partially offset by higher volumes in the metal containers and custom containers segments, a more favorable mix of products sold in the dispensing and specialty closures segment and the pass through of higher raw material costs in the custom containers segment.

In the first nine months of 2024, consolidated net sales were $4.4 billion, a decrease of $204.6 million, or 4.4 percent, as compared to the first nine months of 2023 primarily due to the unfavorable impact from the pass through of lower raw material

costs in the dispensing and specialty closures and metal containers segments, lower volumes in the dispensing and specialty closures segment and a less favorable mix of products sold in the metal containers and custom containers segments.

These decreases were partially offset by a more favorable mix of products sold in the dispensing and specialty closures segment, higher volumes and the pass through of higher raw material costs in the custom containers segment and the impact from favorable foreign currency translation.

Three Months Ended March 31, 2025 Compared with Three Months Ended March 31, 2024

In the first quarter of 2025, consolidated net sales were $1.47 billion, an increase of $149.7 million, or 11.4 percent, as compared to the first quarter of 2024 primarily due to the inclusion of net sales from Weener Packaging, higher organic volumes across all segments and the pass through of higher raw material costs in the metal containers and custom containers segments, partially offset by the impact from unfavorable foreign currency translation of approximately $16 million.

Gross Profit .

Gross profit margin increased 0.9 percentage points to 16.8 percent in the third quarter of 2024 and increased 0.7 percentage points to 17.4 percent in the first nine months of 2024 as compared to the same periods in 2023 primarily for the reasons discussed below in "Income before Interest and Income Taxes."

Gross profit margin increased 1.4 percentage points to 18.4 percent in the first quarter of 2025 as compared to the same period in 2024 primarily for the reasons discussed below in "Income before Interest and Income Taxes."

Selling, General and Administrative Expenses .

In the third quarter of 2024, selling, general and administrative expenses as a percentage of consolidated net sales increased to 6.1 percent as compared to 4.7 percent in the third quarter of 2023.

For the third quarter of 2024, selling, general and administrative expenses increased $22.1 million to $106.4 million as compared to the third quarter of 2023.

In the first nine months of 2024, selling, general and administrative expenses as a percentage of consolidated net sales increased to 7.1 percent as compared to 6.2 percent in the first nine months of 2023.

In the first nine months of 2024, selling, general and administrative expenses increased $26.8 million to $314.6 million as compared to the first nine months of 2023.

The increase in selling, general and administrative expenses for the third quarter and the first nine months of 2024 was primarily due to $7.1 million and $12.6 million, respectively, of costs attributed to announced acquisitions and insurance proceeds received in the prior year periods.

In the first quarter of 2025, selling, general and administrative expenses as a percentage of consolidated net sales increased to 8.8 percent as compared to 7.6 percent in the first quarter of 2024.

For the first quarter of 2025, selling, general and administrative expenses increased $28.6 million to $129.1 million as compared to the first quarter of 2024.

The increase in selling, general and administrative expenses was primarily due to the inclusion of selling, general and administrative expenses of Weener Packaging and higher expenses for corporate development activities.

Income before Interest and Income Taxes .

In the third quarter of 2024, income before interest and income taxes decreased by $26.8 million to $167.3 million as compared to $194.1 million in the third quarter of 2023, and margins decreased to 9.6 percent from 10.7 percent over the same periods.

The decrease in income before interest and income taxes was primarily the result of higher selling, general and administrative costs, higher rationalization charges, a less favorable mix of products sold in the metal containers segment, and the unfavorable impact of foreign currency and lower volumes in the dispensing and specialty closures segment, partially offset by improved manufacturing productivity and cost performance in the dispensing and specialty closures segment, a more favorable mix of products sold in the dispensing and specialty closures and custom containers segments and higher volumes in the metal containers and custom containers segments.

Rationalization charges were $19.5 million and $6.4 million in the third quarters of 2024 and 2023, respectively.

In the first nine months of 2024, income before interest and income taxes decreased by $48.4 million to $420.9 million as compared to $469.3 million in the first nine months of 2023, and margins decreased to 9.5 percent from 10.1 percent over the same periods.

The decrease in income before interest and income taxes was primarily the result of the unfavorable impact of lower fixed cost absorption in the metal containers segment as a result of a significantly lower inventory build in the current year period due to a reduction in pack plans of a large fruit and vegetable customer to reduce its working capital, higher rationalization charges, higher selling, general and administrative costs, the unfavorable impact in the metal containers segment of the sale of higher cost metal inventory from the prior year due to lower metal costs in 2024 in the European operations, a less favorable mix of products sold in the metal containers segment and lower volumes in the dispensing and specialty closures segment, partially offset by improved manufacturing productivity and cost performance in the dispensing and specialty closures segment, a more favorable mix of products sold in the dispensing and specialty closures and custom containers segments and higher volumes in the custom containers segment.

Rationalization charges were $38.0 million and $13.2 million in the first nine months of 2024 and 2023, respectively.

In the first quarter of 2025, income before interest and income taxes increased by $18.8 million to $130.5 million as compared to $111.7 million in the first quarter of 2024, and margins increased to 8.9 percent from 8.5 percent over the same periods.

The increase in income before interest and income taxes was primarily the result of the inclusion of income before interest and income taxes of Weener Packaging and improved manufacturing productivity and cost performance and higher organic volumes across all segments.

Rationalization charges were $11.0 million and $11.7 million in the first quarters of 2025 and 2024, respectively.

Costs attributed to announced acquisitions were $1.1 million in the first quarter of 2025.

Interest and Other Debt Expense .

In the third quarter of 2024, interest and other debt expense decreased $5.4 million to $41.9 million as compared to $47.3 million in the third quarter of 2023.

In the first nine months of 2024, interest and other debt expense decreased $8.9 million to $121.9 million as compared to $130.8 million in the first nine months of 2023.

The decrease in the third quarter of 2024 was primarily due to lower average borrowings during the current year period, partially offset by the impact of higher weighted average interest rates.

The decrease in the first nine months of 2024 was primarily due to lower average borrowings during the current year period and the write-off in the prior year period of $3.5 million of accrued interest income associated with a historical acquisition tax indemnity, partially offset by the impact of higher weighted average interest rates.

In the first quarter of 2025, interest and other debt expense increased $4.3 million to $42.9 million as compared to $38.6 million in the first quarter of 2024.

The increase was primarily due to higher average borrowings during the current year period related to the Weener Packaging acquisition completed in October 2024.

Provision for Income Taxes .

For the third quarters of 2024 and 2023, the effective tax rates were 20.2 percent and 24.7 percent, respectively.

For the first nine months of 2024 and 2023, the effective tax rates were 22.6 percent and 22.7 percent, respectively.

The effective tax rate for the third quarter of 2024 was favorably impacted by the reversal of tax reserves due to the expiration of statutes of limitation.

The effective tax rate for the first nine months of 2023 was favorably impacted by the reversal of tax reserves associated with a historical acquisition indemnity which unfavorably impacted corporate and interest expense in such period.

For the first quarters of 2025 and 2024, the effective tax rates were 23.8 percent and 24.5 percent, respectively.

Non-GAAP Measures

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Adjusted EBIT, a non-GAAP financial measure, means income before interest and income taxes excluding, as applicable, acquired intangible asset amortization expense, other pension (income) expense for U.S.

pension plans, rationalization charges and costs attributed to announced acquisitions.

pension plans, rationalization charges and costs attributed to announced acquisitions and including, as applicable, equity in earnings of affiliates, net of tax.

Adjusted EBIT margin, a non-GAAP financial measure, means adjusted EBIT divided by segment net sales.

5 unchanged sentences

Costs attributed to announced acquisitions consist of third party fees and expenses that are viewed by management as part of the acquisition and not indicative of the on-going cost structure of the Company.

A reconciliation of such non-GAAP financial measures for the periods presented is provided below:

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

The Company's management views the operating performance of its affiliates which are joint ventures as part of the Company's operating performance and therefore believes that the Company's share of the net operating results of its affiliates which are joint ventures should be included in the Company's adjusted EBIT.

A reconciliation of such non-GAAP financial measures for the three months ended March 31 is provided below:

(Dollars in millions)

2 unchanged sentences

Acquired intangible asset amortization expense 13.9 11.9

Other pension (income) expense for U.S.

Other pension (income) for U.S.

pension plans (0.2) (0.3)

Equity in earnings of affiliates, net of tax 1.2 —

Rationalization charges 4.4 6.5

3 unchanged sentences

Acquired intangible asset amortization expense 0.4 0.3

Other pension (income) expense for U.S.

Other pension (income) for U.S.

pension plans (0.4) (0.6)

4 unchanged sentences

Acquired intangible asset amortization expense 1.1 1.1

Other pension (income) expense for U.S.

Other pension (income) for U.S.

pension plans (0.3) (0.3)

6 unchanged sentences

Dispensing and Specialty Closures Segment

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

(Dollars in millions)

4 unchanged sentences

Adjusted EBIT margin 14.8 % 14.5 %

In the third quarter of 2024, net sales for the dispensing and specialty closures segment increased $4.6 million, or 0.8 percent, as compared to the third quarter of 2023.

This increase was primarily the result of a more favorable mix of products sold, partially offset by lower unit volumes of approximately one percent, the pass through of lower raw material costs and the impact of unfavorable foreign currency translation of approximately $2.0 million.

Higher volumes for dispensing products were offset by lower volumes for beverage products.

In the first nine months of 2024, net sales for the dispensing and specialty closures segment decreased $34.1 million, or 2.0 percent, as compared to the first nine months of 2023.

This decrease was primarily the result of lower unit volumes of approximately two percent, the pass through of lower raw material costs and the impact of unfavorable foreign currency translation of approximately $1.0 million, partially offset by a more favorable mix of products sold.

The decrease in unit volumes was principally the result of lower volumes for closures for food and beverage markets primarily due to customer destocking priorities.

In the third quarter of 2024, adjusted EBIT of the dispensing and specialty closures segment increased $1.4 million as compared to the third quarter of 2023, and adjusted EBIT margin increased to 16.9 percent from 16.8 percent over the same periods.

The increase in adjusted EBIT was primarily due to improved manufacturing productivity and cost performance and a more favorable mix of products sold, partially offset by the unfavorable impact of foreign currency and lower unit volumes.

In the first nine months of 2024, adjusted EBIT of the dispensing and specialty closures segment increased $12.2 million as compared to the first nine months of 2023, and adjusted EBIT margin increased to 16.0 percent from 14.9 percent over the same periods.

The increase in adjusted EBIT was primarily due to improved manufacturing productivity and cost performance and a more favorable mix of products sold, partially offset by lower unit volumes.

In the first quarter of 2025, net sales for the dispensing and specialty closures segment increased $135.2 million, or 25.2 percent, as compared to the first quarter of 2024.

This increase was primarily the result of the inclusion of net sales from Weener Packaging, higher organic unit volumes of approximately three percent and a more favorable mix of products sold, partially offset by the impact of unfavorable foreign currency translation of approximately $12.0 million.

In the first quarter of 2025, adjusted EBIT of the dispensing and specialty closures segment increased $21.4 million as compared to the first quarter of 2024, and adjusted EBIT margin increased to 14.8 percent from 14.5 percent over the same periods.

The increase in adjusted EBIT was primarily due to the inclusion of adjusted EBIT from Weener Packaging, improved manufacturing productivity and cost performance, higher organic unit volumes and a more favorable mix of products sold, partially offset by the unfavorable impact of foreign currency.

Metal Containers Segment

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

(Dollars in millions)

4 unchanged sentences

Adjusted EBIT margin 7.9 % 7.3 %

In the third quarter of 2024, net sales for the metal containers segment decreased $72.0 million, or 6.6 percent, as compared to the third quarter of 2023.

This decrease was primarily the result of the contractual pass through of lower raw material costs as compared to the lagged contractual pass through of inflation in labor and other manufacturing costs in the prior year period and a significantly less favorable mix of products sold, partially offset by higher unit volumes of approximately two percent and the impact of favorable foreign currency translation of approximately $2.0 million.

Higher volumes for the pet food markets were partially offset by lower volumes for fruit and vegetable markets which were negatively impacted by a planned reduction in volumes by a large pack customer to reduce its working capital and severe weather that prematurely ended the fruit and vegetable packs.

In the first nine months of 2024, net sales for the metal containers segment decreased $185.1 million, or 7.5 percent, as compared to the first nine months of 2023.

This decrease was primarily the result of the contractual pass through of lower raw material costs as compared to the lagged contractual pass through of inflation in labor and other manufacturing costs in the prior year period and a less favorable mix of products sold, partially offset by the impact of favorable foreign currency translation of approximately $4.0 million.

In the third quarter of 2024, adjusted EBIT of the metal containers segment decreased $16.4 million as compared to the third quarter of 2023, and adjusted EBIT margin decreased to 9.5 percent from 10.4 percent for the same periods.

The decrease in adjusted EBIT was primarily due to a significantly less favorable mix of products sold due to lower unit volumes for fruit and vegetable markets and higher selling, general and administrative costs, partially offset by higher unit volumes for pet food markets.

In the first nine months of 2024, adjusted EBIT of the metal containers segment decreased $41.2 million as compared to the first nine months of 2023, and adjusted EBIT margin decreased to 8.8 percent from 9.8 percent for the same periods.

The decrease in adjusted EBIT was primarily due to the unfavorable impact of lower fixed cost absorption as a result of a significantly lower inventory build in the current year period due to a reduction in pack plans of a large fruit and vegetable customer to reduce its working capital, the unfavorable impact of selling higher cost inventory from the prior year in our European operations due to lower metal costs in 2024, a significantly less favorable mix of products sold and higher selling, general and administrative costs.

In the first quarter of 2025, net sales for the metal containers segment increased $11.3 million, or 1.8 percent, as compared to the first quarter of 2024.

This increase was primarily the result of higher unit volumes of approximately four percent and the pass through of higher raw material costs, partially offset by a less favorable mix of products sold and the impact of unfavorable foreign currency translation of approximately $2.0 million.

The increase in unit volumes was primarily due to higher volumes for pet food and soup markets.

In the first quarter of 2025, adjusted EBIT of the metal containers segment increased $4.6 million as compared to the first quarter of 2024, and adjusted EBIT margin increased to 7.9 percent from 7.3 percent for the same periods.

The increase in adjusted EBIT was primarily due to improved manufacturing productivity and cost performance and higher unit volumes, partially offset by a less favorable mix of products sold due to higher unit volumes of smaller cans for pet food markets.

Custom Containers Segment

Three Months Ended Nine Months Ended

30, 2024 Sept.

30, 2023 Sept.

30, 2024 Sept.

(Dollars in millions)

4 unchanged sentences

Adjusted EBIT margin 14.7 % 12.3 %

In the third quarter of 2024, net sales for the custom containers segment increased $9.4 million, or 6.3 percent, as compared to the third quarter of 2023.

This increase was principally due to higher volumes of approximately five percent primarily driven by the commercialization of new business awards and the pass through of higher raw material costs, partially offset by the impact of unfavorable foreign currency translation of approximately $1.0 million.

In the first nine months of 2024, net sales for the custom containers segment increased $14.6 million, or 3.1 percent, as compared to the first nine months of 2023.

This increase was principally due to higher volumes of approximately three percent primarily as a result of the commercialization of new business awards and the pass through of higher raw material costs, partially offset by a less favorable mix of products sold and the impact of unfavorable foreign currency translation of approximately $1.0 million.

In the third quarter of 2024, adjusted EBIT of the custom containers segment increased $8.2 million as compared to the third quarter of 2023, and adjusted EBIT margin increased to 12.6 percent from 7.9 percent over the same periods.

The increase in adjusted EBIT was primarily attributable to a more favorable mix of products sold and higher volumes.

In the first nine months of 2024, adjusted EBIT of the custom containers segment increased $12.4 million as compared to the first nine months of 2023, and adjusted EBIT margin increased to 12.8 percent from 10.6 percent over the same periods.

The increase in adjusted EBIT was primarily attributable to a more favorable mix of products sold and higher volumes.

In the first quarter of 2025, net sales for the custom containers segment increased $3.2 million, or 2.0 percent, as compared to the first quarter of 2024.

This increase was principally due to higher volumes of approximately two percent primarily driven by new business awards and the pass through of higher raw material costs, partially offset by the impact of unfavorable foreign currency translation of approximately $2.0 million.

In the first quarter of 2025, adjusted EBIT of the custom containers segment increased $4.4 million as compared to the first quarter of 2024, and adjusted EBIT margin increased to 14.7 percent from 12.3 percent over the same periods.

The increase in adjusted EBIT was primarily attributable to improved manufacturing productivity and cost performance and higher volumes.

CAPITAL RESOURCES AND LIQUIDITY

1 unchanged sentence

Our liquidity requirements arise from our obligations under the indebtedness incurred in connection with our acquisitions and the refinancing of that indebtedness, capital investment in new and existing equipment, the funding of our seasonal working capital needs and other general corporate uses.

On October 15, 2024, we acquired Weener, a leading producer of differentiated dispensing solutions for personal care, food and healthcare products.

Weener operates a global network of 19 facilities predominantly in Europe and the Americas, with approximately 4,000 employees and proprietary manufacturing technologies including significant clean room capabilities.

The purchase price for this acquisition of approximately $920.0 million, net of cash acquired, was funded with term and revolving loan borrowings under the Credit Agreement, including a new €700.0 million incremental term loan, and cash on hand.

In October 2024, we entered into €685.0 million aggregate notional principal amount of Euro interest rate swap agreements to manage a portion of our exposure to interest rate fluctuations for our Euro term loans under the Credit Agreement, which mature as follows:

€35.0 million in October 2026, €70.0 million in October 2027 and €580.0 million in October 2030.

These agreements have a weighted average fixed rate of 2.43 percent and were entered into with financial institutions which are expected to fully perform under the terms thereof.

On November 4, 2024, we and certain of our wholly owned subsidiaries entered into the Fifth Amendment with the Lenders therein and Wells Fargo Bank, National Association, as Administrative Agent.

The Fifth Amendment:

• refinanced outstanding term loans and revolving loans thereunder and extended the maturity dates to (i) November 4, 2029 with respect to revolving loans and (ii) November 4, 2030 with respect to term loans;

• increased the aggregate amount of Euro term loans thereunder from €700.0 million to €900.0 million, with the additional €200.0 million of Euro term loans being used to repay revolving loans under the Credit Agreement that were used to fund a portion of the purchase price for Weener and to pay fees, expenses and costs associated with the Fifth Amendment.

• removed the springing maturity date provisions that would have shortened the maturity dates under the Credit Agreement to the date that is 91 days prior to the maturity dates of the 3¼% Senior Notes and 1.4% Senior Secured Notes due 2026 (unless such notes were refinanced or repaid prior thereto);

• improved the interest rate margin grid for term loans;

• increased the uncommitted multi-currency incremental loan facility from $1.25 billion to $1.5 billion;

• amended certain covenants to provide additional flexibility;

• amended certain other terms of the Credit Agreement.

Pursuant to the Fifth Amendment, total term loans of $1,854.4 million are repayable as follows:

$18.5 million in 2025, $92.7 million in 2026, $185.4 million in each of 2027, 2028 and 2029, and $1,187.0 million in 2030 (non-U.S.

dollar debt has been translated into U.S.

dollars at exchange rates in effect at the balance sheet date).

As a result of the Fifth Amendment, we expect to record a pre-tax charge of approximately $0.9 million for the loss on early extinguishment of debt during the quarter ending December 31, 2024.

You should also read Note 15 to our Condensed Consolidated Financial Statements for the three and nine months ended September 30, 2024 included elsewhere in this quarterly report.

For the nine months ended September 30, 2024, we used net borrowings of revolving loans of $491.6 million and cash and cash equivalents of $274.4 million to fund cash used in operations of $213.9 million, decreases in outstanding checks of $160.6 million, the repayment of long-term debt of $100.0 million, net capital expenditures and other investing activities of $189.1 million, dividends paid on our common stock of $61.8 million, the repayment of principal amounts under finance leases of $27.3 million, repurchases of our common stock of $7.7 million and the negative effect of exchange rate changes on cash and cash equivalents of $5.6 million.

For the nine months ended September 30, 2023, we used net borrowings of revolving loans and proceeds from other foreign long-term debt of an aggregate of $847.5 million and cash and cash equivalents of $278.5 million (including the positive effect of exchange rate changes of $0.5 million) to fund cash used in operations of $596.0 million, repurchases of our common stock of $183.9 million, net capital expenditures and other investing activities of $170.6 million, decreases in outstanding checks of $61.4 million, dividends paid on our common stock of $59.7 million, the repayment of long-term debt of $52.7 million and the repayment of principal amounts under finance leases of $2.2 million.

At September 30, 2024, we had $505.0 million of revolving loans outstanding under the Credit Agreement.

After taking into account outstanding letters of credit, the available portion of revolving loans under the Credit Agreement at September 30, 2024 was $974.4 million.

On March 15, 2025, we repaid all €650.0 million aggregate principal amount of our outstanding 3¼% Notes at 100 percent of their principal amount plus accrued and unpaid interest to the repayment date.

We funded this repayment with Euro revolving loan borrowings under the Credit Agreement and cash on hand.

For the three months ended March 31, 2025, we used net borrowings of revolving loans of $1.1 billion, cash and cash equivalents of $469.9 million and the positive effect of exchange rate changes on cash and cash equivalents of $13.0 million to fund the repayment of long-term debt of $706.3 million, cash used in operations of $683.4 million, decreases in outstanding checks of $85.0 million, net capital expenditures and other investing activities of $82.5 million, dividends paid on our common stock of $21.9 million, repurchases of our common stock of $6.9 million and the repayment of principal amounts under finance leases of $1.3 million.

For the three months ended March 31, 2024, we used net borrowings of revolving loans of $582.4 million and cash and cash equivalents of $334.3 million to fund cash used in operations of $547.8 million, decreases in outstanding checks of $160.6 million, the repayment of long-term debt of $100.0 million, net capital expenditures and other investing activities of $72.5 million, dividends paid on our common stock of $21.1 million, repurchases of our common stock of $7.7 million, the repayment of principal amounts under finance leases of $0.3 million and the negative effect of exchange rate changes on cash and cash equivalents of $6.7 million.

At March 31, 2025, we had $1.1 billion of revolving loans outstanding under the Credit Agreement.

After taking into account outstanding letters of credit, the available portion of revolving loans under the Credit Agreement at March 31, 2025 was $398.2 million.

Because we sell metal containers and closures used in fruit and vegetable pack processing, we have seasonal sales.

3 unchanged sentences

We fund seasonal working capital requirements through revolving loans under the Credit Agreement, other foreign bank loans and cash on hand.

We may use the available portion of revolving loans under the Credit Agreement, after taking into account our seasonal needs and outstanding letters of credit, for other general corporate purposes including acquisitions, capital expenditures, dividends, stock repurchases and to refinance or repurchase other debt.

We may use the available portion of revolving loans under the Credit Agreement, after taking into account our seasonal needs and outstanding

letters of credit, for other general corporate purposes including acquisitions, capital expenditures, dividends, stock repurchases and to refinance or repurchase other debt.

We believe that cash generated from operations and funds from borrowings available under the Credit Agreement and other foreign bank loans will be sufficient to meet our expected operating needs, planned capital expenditures, debt service, tax obligations, pension benefit plan contributions, share repurchases and common stock dividends for the foreseeable future.

14 unchanged sentences

Separate from this SCF program, we and suppliers who participate in this SCF program generally maintain the contractual right to require the other party to negotiate in good faith the existing payment terms as a result of changes in market conditions, including changes in interest rates and general market liquidity, or in some cases for any reason.

Outstanding trade accounts payables subject to this SCF program were approximately $284.2 million, $294.1 million and $330.2 million at September 30, 2024 and 2023 and December 31, 2023, respectively.

Outstanding trade accounts payables subject to this SCF program were approximately $262.9 million, $252.6 million and $303.7 million at March 31, 2025 and 2024 and December 31, 2024, respectively.

Guaranteed Securities

Each of the 3¼% Senior Notes, the 4⅛% Senior Notes, the 2¼% Senior Notes and the 1.4% Senior Secured Notes were issued by Silgan and are guaranteed by our U.S.

Each of the 4⅛% Senior Notes, the 2¼% Senior Notes and the 1.4% Senior Secured Notes were issued by Silgan and are guaranteed by our U.S.

subsidiaries that also guarantee our obligations under the Credit Agreement, collectively the Obligor Group.

The following summarized financial information relates to the Obligor Group as of September 30, 2024 and December 31, 2023 and for the nine months ended September 30, 2024.

The following summarized financial information relates to the Obligor Group as of March 31, 2025 and December 31, 2024 and for the three months ended March 31, 2025.

Intercompany transactions, equity investments and other intercompany activity within the Obligor Group have been eliminated from the summarized financial information.

Investments in subsidiaries of Silgan that are not part of the Obligor Group of $1.7 billion and $1.6 billion as of September 30, 2024 and December 31, 2023, respectively, are not included in noncurrent assets in the table below.

30, 2024 Dec.

Investments in subsidiaries of Silgan that are not part of the Obligor Group of $2.2 billion and $2.1 billion as of March 31, 2025 and December 31, 2024, respectively, are not included in noncurrent assets in the table below.

March 31, 2025 Dec.

(Dollars in millions)

3 unchanged sentences

Noncurrent liabilities 4,014.0 3,987.8

At September 30, 2024 and December 31, 2023, the Obligor Group held current receivables due from other subsidiary companies of $19.7 million and $35.6 million, respectively;

long-term notes receivable due from other subsidiary companies of $755.3 million and $748.8 million, respectively;

At March 31, 2025 and December 31, 2024, the Obligor Group held current receivables due from other subsidiary companies of $32.0 million and $33.0 million, respectively;

long-term notes receivable due from other subsidiary companies of $1.1 billion in each of the periods;

and current payables due to other subsidiary companies of $17.2 million and $19.0 million, respectively.

Nine Months Ended

Three months ended

March 31, 2025

(Dollars in millions)

2 unchanged sentences

Net income 30.5

For the nine months ended September 30, 2024, net income in the table above excludes income from equity method investments of other subsidiary companies of $87.1 million.

For the nine months ended September 30, 2024, the Obligor Group recorded the following transactions with other subsidiary companies:

For the three months ended March 31, 2025, net income in the table above excludes income from equity method investments of other subsidiary companies of $37.5 million.

For the three months ended March 31, 2025, the Obligor Group recorded the following transactions with other subsidiary companies:

sales to such other subsidiary companies of $16.0 million;

1 unchanged sentence

and net interest income from such other subsidiary companies of $12.7 million.

For the nine months ended September 30, 2024, the Obligor Group did not receive dividends from other subsidiary companies.

For the three months ended March 31, 2025, the Obligor Group did not receive dividends from other subsidiary companies.

Rationalization Charges

1 unchanged sentence

We use a disciplined approach to identify opportunities that generate attractive cash returns.

Under our rationalization plans, we made cash payments of $31.2 million and $8.9 million for the nine months ended September 30, 2024 and 2023, respectively.

Under our rationalization plans, we made cash payments of $3.5 million and $11.8 million for the three months ended March 31, 2025 and 2024, respectively.

Excluding the impact of our withdrawal from the Central States Pension Plan in 2019, remaining expenses and cash expenditures for our rationalization plans are expected to be $15.9 million and $20.3 million, respectively.

Remaining expenses for the accretion of interest for the withdrawal liability related to the Central States Pension Plan are expected to average approximately $0.8 million per year and be recognized annually through 2040, and remaining cash expenditures for the withdrawal liability related to the Central States Pension Plan are expected to be approximately $2.6 million annually through 2040.

You should also read Note 3 to our Condensed Consolidated Financial Statements for the three and nine months ended September 30, 2024 included elsewhere in this Quarterly Report.

You should also read Note 3 to our Condensed Consolidated Financial Statements for the three months ended March 31, 2025 included elsewhere in this Quarterly Report.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis