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SILGAN HOLDINGS INC (SLGN)·Q1 2025 Earnings Summary

Executive Summary

  • Record Q1 2025 net sales of $1.47B and adjusted EPS of $0.82, with organic volume growth across all segments; adjusted EPS rose 19% YoY near the high end of expectations .
  • Versus estimates: adjusted EPS beat consensus ($0.82 vs $0.788*), while revenue was a slight miss ($1.467B vs $1.474B*); management confirmed FY 2025 adjusted EPS $4.00–$4.20 and FCF ~$450M, interest ~$185M, and tax ~24% .
  • Segment momentum: Dispensing & Specialty Closures delivered fourth consecutive quarter of double-digit dispensing volume growth; Metal Containers grew mid-single digits in pet food and soup; Custom Containers delivered record Q1 adjusted EBIT .
  • Stock reaction catalyst: Durable organic growth and positive Q2 guide ($0.98–$1.08 adj. EPS) counterbalanced by modest top-line miss and higher interest expense; narrative supported by Weener integration outperformance and confirmed FY guide .

What Went Well and What Went Wrong

What Went Well

  • “Our team delivered another quarter of record results… volume growth and outstanding operating performance across all segments… strong results from the Weener acquisition and continued execution of our cost reduction program” – CEO Adam Greenlee .
  • Dispensing & Specialty Closures: fourth consecutive quarter of double-digit organic growth in dispensing, record Q1 adjusted EBIT, with Weener contributing ~$16.8M adjusted EBIT and ~$126.1M sales .
  • Metal Containers: mid-single digit volume growth driven by pet food and soup; favorable price/cost and higher volumes lifted adjusted EBIT YoY .

What Went Wrong

  • Revenue was a slight miss vs consensus (actual $1.467B vs $1.475B*), despite strong volume; FX headwinds in Dispensing & Specialty Closures partially offset benefits [*].
  • Interest & other debt expense increased to $42.9M (+$4.3M YoY) from acquisition-related borrowings, pressuring GAAP EPS despite adjusted outperformance .
  • Mix headwinds in Metal (growth in smaller pet food cans) tempered price/mix, with Q2 volumes expected flat before fruit/veg pack recovery in Q3 .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$1.745 $1.411 $1.467
Diluted EPS (GAAP)$0.93 $0.42 $0.63
Adjusted EPS (Non-GAAP)$1.21 $0.85 $0.82
Gross Profit Margin %16.8% (293.3/1,745.1) 16.9% (239.0/1,411.2) 18.4% (270.4/1,466.7)
EBIT Margin %9.6% (167.3/1,745.1) 6.7% (94.2/1,411.2) 8.9% (130.5/1,466.7)
Net Income Margin %5.7% (100.1/1,745.1) 3.2% (45.1/1,411.2) 4.6% (68.0/1,466.7)
SegmentQ3 2024 Net Sales ($MM)Q4 2024 Net Sales ($MM)Q1 2025 Net Sales ($MM)
Dispensing & Specialty Closures563.7 639.4 671.1
Metal Containers1,022.6 610.2 628.4
Custom Containers158.8 161.6 167.2
Consolidated1,745.1 1,411.2 1,466.7
SegmentQ3 2024 Adjusted EBIT ($MM)Q4 2024 Adjusted EBIT ($MM)Q1 2025 Adjusted EBIT ($MM)
Dispensing & Specialty Closures95.2 99.9 99.2
Metal Containers97.1 41.9 49.6
Custom Containers20.0 18.2 24.6
Total Adjusted EBIT205.6 151.7 158.3
KPIsQ3 2024Q4 2024Q1 2025
Effective Tax Rate20.2% 8.8% 23.8%
Interest & Other Debt Expense ($MM)41.9 44.5 42.9
Weighted Avg Diluted Shares (MM)107.1 107.3 107.3
Net Debt ($MM)$3,439.6 (Debt 3,808.1 – Cash 368.5) $3,313.9 (Debt 4,136.8 – Cash 822.9) $4,275.6 (Debt 4,628.6 – Cash 353.0)
Actual vs S&P Global ConsensusQ4 2024Q1 2025
Adj. EPS (Actual vs Consensus)$0.85 vs $0.822* $0.82 vs $0.788*
Revenue ($MM, Actual vs Consensus)$1,411.2 vs $1,398.7* $1,466.7 vs $1,474.7*
EPS Estimates Count9*8*
Revenue Estimates Count8*9*

Note: Asterisk values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious Guidance (as of Jan 29, 2025)Current Guidance (as of Apr 30, 2025)Change
Adjusted EPSFY 2025$4.00–$4.20 $4.00–$4.20 Maintained
Free Cash FlowFY 2025~$450M ~$450M Maintained
Interest & Other Debt ExpenseFY 2025~ $185M ~ $185M Maintained
Effective Tax RateFY 2025~24% ~24% Maintained
Capital ExpendituresFY 2025~$300M ~$300M Maintained
Adjusted EPSQ1 2025$0.74–$0.84 Actual $0.82 Delivered near top end
Adjusted EPSQ2 2025N/A$0.98–$1.08 New
Segment Adjusted EBITFY 2025DSC: >20%; Custom: mid-teens; Metal: high single-digit Confirmed same Maintained
Dividend per Share (Quarterly)Q2 2025$0.19 (Q4 declared) $0.20 declared for Jun 16, 2025 Raised

Earnings Call Themes & Trends

TopicQ3 2024 (Oct 30)Q4 2024 (Jan 29)Q1 2025 (Apr 30)Trend
Dispensing growthDouble-digit organic dispensing; record segment adj. EBIT Record DSC adj. EBIT; 3rd consecutive quarter of double-digit dispensing volume growth 4th consecutive quarter of double-digit dispensing volume growth; Weener ahead of plan Strengthening
Pet food demandHigh single-digit growth in pet food Double-digit growth in pet food in Q4 Mid-single-digit pet food volume growth continues; targeted promotions driving wet pet Durable
Fruit/veg packSofter volumes due to weather and customer working capital actions Early end to packs; volumes below prior year Q2 flat volumes; pack recovery expected in Q3 Recovery into Q3
Weener integrationAcquisition closed; synergy path outlined Integration ongoing; inventory actions boosted FCF Performing ahead of model; capital deployed supporting growth Positive
Tariffs/macroMixed success of customer promotions; macro watch Double-digit FCF growth despite macro Minimal tariff impact due to local manufacturing; pass-through any inflation; luxury fragrance able to take price Neutral/managed
FX exposureNot highlightedTax restructuring aided rate FX sensitivity limited; spot rates held; natural hedges via local debt Limited risk
Leverage & M&ARenewed long-term contract; positioning for 2025 Leverage outlook improving post-Weener Targeting low end of 2.5–3.5x by YE; active, disciplined M&A pipeline Improving leverage; active M&A
E-commerce (pet)Not highlightedNot highlighted~25% of pet food through e-commerce; SLGN appropriately represented Stable exposure

Management Commentary

  • CEO: “Our Dispensing and Specialty Closures business delivered another quarter of double digit organic volume growth in dispensing products… generated record first quarter adjusted EBIT in the segment.” .
  • CEO: “We remain confident in our ability to deliver results that outpace our end market growth in 2025 and beyond… disciplined capital deployment strategy.” .
  • CFO: “Record total adjusted EBIT… $158.3M increased by 17% YoY… record adjusted EPS of $0.82 increased $0.13 or 19%.” .
  • CEO on pet food & soup: “Consumer demand… continues to grow… we have commercialized several new customer product launches in the category to drive growth.” .
  • CEO on tariffs: “There just isn’t that much cross-border activity… we like to buy raw materials, make it and sell it in the same geography.” .

Q&A Highlights

  • Volume outlook: Management reiterated mid-single-digit volume growth in each segment for 2025; noted slight Q1 pull-forward in pet aluminum cans due to a customer labor issue, with Q2 Metal volumes flat before Q3 pack recovery .
  • Weener integration: Performing slightly ahead of expectations; capital investments at end of 2024 are driving incremental volume and bottom-line growth .
  • Tariffs & FX: Limited tariff exposure due to local manufacturing and pass-through mechanisms; FX held at Q1 spot rates with natural hedges (local currency debt) .
  • Pet category promotions: Targeted promotions in wet pet and retail driving volume; mixed outcomes in isotonic beverages depending on customer promotional intensity .
  • Leverage/M&A: Expect net debt/EBITDA toward low end of 2.5–3.5x by year-end; disciplined M&A pipeline, ready to deploy capital when targets come to market .

Estimates Context

  • Q1 2025: Adjusted EPS beat ($0.82 vs $0.788*), revenue slight miss ($1,466.7MM vs $1,474.7MM*). Strength in Dispensing and pet food volumes, cost reduction and Weener synergies drove EPS above consensus despite higher interest expense .
  • Prior quarter Q4 2024: Adjusted EPS beat ($0.85 vs $0.822*), revenue beat ($1,411.2MM vs $1,398.7MM*), aided by inventory actions in DSC and price/cost .
  • Implications: Q2 guide ($0.98–$1.08) suggests continued EPS momentum; consensus may need to raise FY EPS if Q2 delivery tracks the midpoint and Weener outperformance persists .

Note: Asterisk values retrieved from S&P Global.

Key Takeaways for Investors

  • Organic growth is durable across segments, with Dispensing delivering multi-quarter double-digit volume growth; integration of Weener is ahead of plan, reinforcing EPS trajectory .
  • Despite a modest revenue miss vs consensus, margin profile improved (gross margin 18.4%, EBIT margin 8.9%), supporting the adjusted EPS beat .
  • FY guide reaffirmed (adj. EPS $4.00–$4.20; FCF ~$450M; interest ~$185M; tax ~24%), and Q2 guide (adj. EPS $0.98–$1.08) indicates near-term momentum; positive estimate revisions are plausible if execution continues .
  • Metal Containers mix headwinds (smaller pet cans) are manageable; Q3 fruit/veg pack recovery is a catalyst; pet food promotions and new soup launches support volumes .
  • Leverage trending lower; capital allocation remains M&A-first but disciplined, with capacity to pivot to buybacks/debt paydown if targets stall .
  • Dividend raised to $0.20 (paid Jun 16), marking 85 consecutive quarterly payments since 2004—income support alongside growth .
  • Risk watch: interest expense elevated from acquisition financing; FX and tariffs limited by local manufacturing but monitored; isotonic beverage volumes tied to promotional intensity .