10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to ________________

Commission file number  000-22117

SILGAN HOLDINGS INC.

(Exact name of Registrant as specified in its charter)

Delaware		06-1269834
(State or other jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)
4 Landmark Square
Stamford,	Connecticut	06901
(Address of principal executive offices)		(Zip Code)

(203) 975-7110

(Registrant's telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	SLGN	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒   No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).  Yes ☒   No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐   No ☒

As of July 29, 2022, the number of shares outstanding of the Registrant’s common stock was 110,215,515.

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SILGAN HOLDINGS INC.
TABLE OF CONTENTS
	Page No.
Part I.  Financial Information	3
Item 1.    Financial Statements	3
Condensed Consolidated Balance Sheets at June 30, 2022 and 2021 and December 31, 2021	3
Condensed Consolidated Statements of Income for the three and six months ended June 30, 2022 and 2021	4
Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2022 and 2021	5
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021	6
Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2022 and 2021	7
Notes to Condensed Consolidated Financial Statements	8
Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.    Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.    Controls and Procedures	26
Part II.  Other Information	27
Item 1.    Legal Proceedings	27
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds	27
Item 6.    Exhibits	28
Signatures	29

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Part I. Financial Information

Item 1. Financial Statements

SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(unaudited)		(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	247,843	$	164,821	$	631,439
Trade accounts receivable, net	931,282		891,812		711,332
Inventories	1,253,894		907,805		798,837
Prepaid expenses and other current assets	120,133		88,818		154,241
Total current assets	2,553,152		2,053,256		2,295,849
Property, plant and equipment, net	1,932,805		1,832,885		1,993,877
Goodwill	1,966,136		1,719,815		2,038,408
Other intangible assets, net	785,976		609,882		830,772
Other assets, net	636,430		508,481		611,940
	$	7,874,499	$	6,724,319	$	7,770,846
Liabilities and Stockholders’ Equity
Current liabilities:
Revolving loans and current portion of long-term debt	$	718,695	$	240,859	$	20,251
Trade accounts payable	880,862		727,523		1,133,318
Accrued payroll and related costs	109,211		112,270		109,279
Accrued liabilities	251,271		234,503		245,674
Total current liabilities	1,960,039		1,315,155		1,508,522
Long-term debt	3,367,469		3,176,393		3,772,926
Deferred income taxes	430,147		360,027		435,252
Other liabilities	491,381		484,164		491,450
Stockholders’ equity:
Common stock	1,751		1,751		1,751
Paid-in capital	331,877		314,873		325,448
Retained earnings	2,833,431		2,531,783		2,691,745
Accumulated other comprehensive loss	(308,216)		(263,433)		(259,828)
Treasury stock	(1,233,380)		(1,196,394)		(1,196,420)
Total stockholders’ equity	1,625,463		1,388,580		1,562,696
	$	7,874,499	$	6,724,319	$	7,770,846

See accompanying notes.

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SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

For the three and six months ended June 30, 2022 and 2021

(Dollars and shares in thousands, except per share amounts)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Net sales	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771
Cost of goods sold	1,269,855		1,113,777		2,478,288		2,130,421
Gross profit	273,926		234,884		507,379		456,350
Selling, general and administrative expenses	123,830		94,394		223,841		191,773
Rationalization charges	3,428		354		4,807		10,711
Other pension and postretirement income	(11,349)		(12,818)		(22,678)		(25,637)
Income before interest and income taxes	158,017		152,954		301,409		279,503
Interest and other debt expense before loss on     early extinguishment of debt	28,660		26,406		58,009		52,829
Loss on early extinguishment of debt	—		—		1,481		883
Interest and other debt expense	28,660		26,406		59,490		53,712
Income before income taxes	129,357		126,548		241,919		225,791
Provision for income taxes	36,682		32,072		64,369		58,034
Net income	$	92,675	$	94,476	$	177,550	$	167,757
Earnings per share:
Basic net income per share	$	0.84	$	0.86	$	1.60	$	1.52
Diluted net income per share	$	0.83	$	0.85	$	1.59	$	1.51
Weighted average number of shares:
Basic	110,840		110,442		110,750		110,323
Effect of dilutive securities	388		661		590		743
Diluted	111,228		111,103		111,340		111,066

See accompanying notes.

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 SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three and six months ended June 30, 2022 and 2021

(Dollars in thousands)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Net income	$	92,675	$	94,476	$	177,550	$	167,757
Other comprehensive income (loss), net of tax:
Changes in net prior service credit and actuarial losses	539		1,876		1,038		3,754
Change in fair value of derivatives	(60)		828		2,277		1,469
Foreign currency translation	(64,053)		25,669		(51,703)		(7,703)
Other comprehensive (loss) income	(63,574)		28,373		(48,388)		(2,480)
Comprehensive income	$	29,101	$	122,849	$	129,162	$	165,277

See accompanying notes.

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 SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six months ended June 30, 2022 and 2021

(Dollars in thousands)

(Unaudited)

	2022		2021
Cash flows provided by (used in) operating activities:
Net income	$	177,550	$	167,757
Adjustments to reconcile net income to net cash     provided by (used in) operating activities:
Depreciation and amortization	136,790		122,386
Rationalization charges	4,807		10,711
Stock compensation expense	8,870		10,337
Loss on early extinguishment of debt	1,481		883
Other changes that provided (used) cash, net of effects from acquisitions:
Trade accounts receivable, net	(243,261)		(277,768)
Inventories	(475,171)		(233,815)
Trade accounts payable	15,331		31,825
Accrued liabilities	15,914		(24,316)
Other, net	5,753		(17,313)
Net cash used in operating activities	(351,936)		(209,313)
Cash flows provided by (used in) investing activities:
Purchase of businesses, net of cash acquired	(1,333)		2,305
Capital expenditures	(118,357)		(123,604)
Other, net	(688)		4,914
Net cash used in investing activities	(120,378)		(116,385)
Cash flows provided by (used in) financing activities:
Borrowings under revolving loans	753,657		318,141
Repayments under revolving loans	(54,815)		(105,856)
Proceeds from issuance of long-term debt	—		499,725
Repayments of long-term debt	(300,000)		(500,000)
Changes in outstanding checks - principally vendors	(225,863)		(84,216)
Dividends paid on common stock	(36,680)		(31,564)
Debt issuance costs	—		(4,905)
Repurchase of common stock	(39,402)		(8,538)
Net cash provided by financing activities	96,897		82,787
Effect of exchange rate changes on cash and cash equivalents	(8,179)		(1,749)
Cash and cash equivalents:
Net decrease	(383,596)		(244,660)
Balance at beginning of year	631,439		409,481
Balance at end of period	$	247,843	$	164,821
Interest paid, net	$	59,297	$	48,026
Income taxes paid, net	28,881		47,297

See accompanying notes.

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SILGAN HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the three and six months ended June 30, 2022 and 2021

(Dollars and shares in thousands, except per share amounts)

(Unaudited)

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Common stock - shares outstanding
Balance at beginning of period	110,800		110,386		110,410		110,057
Net issuance of treasury stock for vested restricted stock units	65		22		455		351
Repurchases of common stock	(650)		—		(650)		—
Balance at end of period	110,215		110,408		110,215		110,408
Common stock - par value
Balance at beginning and end of period	$	1,751	$	1,751	$	1,751	$	1,751
Paid-in capital
Balance at beginning of period	328,201		309,635		325,448		306,363
Stock compensation expense	3,991		5,327		8,870		10,337
Net issuance of treasury stock for vested restricted stock units	(315)		(89)		(2,441)		(1,827)
Balance at end of period	331,877		314,873		331,877		314,873
Retained earnings
Balance at beginning of period	2,758,697		2,452,996		2,691,745		2,395,395
Net income	92,675		94,476		177,550		167,757
Dividends declared on common stock	(17,941)		(15,689)		(35,864)		(31,369)
Balance at end of period	2,833,431		2,531,783		2,833,431		2,531,783
Accumulated other comprehensive loss
Balance at beginning of period	(244,642)		(291,806)		(259,828)		(260,953)
Other comprehensive (loss) income	(63,574)		28,373		(48,388)		(2,480)
Balance at end of period	(308,216)		(263,433)		(308,216)		(263,433)
Treasury stock
Balance at beginning of period	(1,205,768)		(1,196,221)		(1,196,420)		(1,189,683)
Net issuance of treasury stock for vested restricted stock units	(1,245)		(173)		(10,593)		(6,711)
Repurchases of common stock	(26,367)		—		(26,367)		—
Balance at end of period	(1,233,380)		(1,196,394)		(1,233,380)		(1,196,394)
Total stockholders' equity	$	1,625,463	$	1,388,580	$	1,625,463	$	1,388,580
Dividends declared on common stock per share	$	0.16	$	0.14	$	0.32	$	0.28

See accompanying notes.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 1.               Significant Accounting Policies

Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Silgan Holdings Inc., or Silgan, have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying financial statements include all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation. The results of operations for any interim period are not necessarily indicative of the results of operations for the full year.

The Condensed Consolidated Balance Sheet at December 31, 2021 has been derived from our audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements.

You should read the accompanying condensed consolidated financial statements in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

Note 2.               Revenue

The following tables present our revenues disaggregated by reportable segment and geography as they best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenues by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	602,431	$	545,768	$	1,200,358	$	1,055,120
Metal Containers	754,396		624,534		1,405,122		1,178,615
Custom Containers	186,954		178,359		380,187		353,036
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

Revenues by geography were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
North America	$	1,154,614	$	968,497	$	2,240,838	$	1,866,899
Europe and other	389,167		380,164		744,829		719,872
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

Our contract assets primarily consist of unbilled accounts receivable related to over time revenue recognition and were $110.3 million, $92.6 million, and $78.2 million as of June 30, 2022 and 2021 and December 31, 2021, respectively. Unbilled receivables are included in trade accounts receivable, net on our Condensed Consolidated Balance Sheets.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 3.               Rationalization Charges

We continually evaluate cost reduction opportunities across each of our segments, including rationalizations of our existing facilities through plant closings and downsizings. We use a disciplined approach to identify opportunities that generate attractive cash returns. Rationalization charges by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	—	$	67	$	—	$	5,298
Metal Containers	3,428		225		4,702		5,246
Custom Containers	—		62		105		167
	$	3,428	$	354	$	4,807	$	10,711

Activity in reserves for our rationalization plans were as follows:

	Employee Severance and Benefits		Plant Exit Costs		Non-Cash Asset Write-Down		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	41,090	$	157	$	—	$	41,247
Charged to expense	3,833		737		237		4,807
Utilized and currency translation	(3,519)		(737)		(237)		(4,493)
Balance at June 30, 2022	$	41,404	$	157	$	—	$	41,561

Non-cash asset write-downs were the result of comparing the carrying value of certain production related assets to their fair value using estimated future discounted cash flows, a Level 3 fair value measurement (see Note 7 for information regarding a Level 3 fair value measurement).

Rationalization reserves as of June 30, 2022 were recorded in our Condensed Consolidated Balance Sheet as accrued liabilities of $5.0 million and other liabilities of $36.6 million. Excluding the impact of our withdrawal from the Central States, Southeast and Southwest Areas Pension Plan, or the Central States Pension Plan, in 2019, remaining expenses and cash expenditures for our rationalization plans are expected to be $3.8 million and $7.4 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 $0.9 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 $3.1 million annually through 2040.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 4.               Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss is reported in our Condensed Consolidated Statements of Stockholders’ Equity.  Amounts included in accumulated other comprehensive loss, net of tax, were as follows:

 

	Unrecognized Net Defined Benefit Plan Costs		Change in Fair Value of Derivatives		Foreign Currency Translation		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	(119,474)	$	(2,327)	$	(138,027)	$	(259,828)
Other comprehensive loss before reclassifications	—		2,257		(51,703)		(49,446)
Amounts reclassified from accumulated other     comprehensive loss	1,038		20		—		1,058
Other comprehensive loss	1,038		2,277		(51,703)		(48,388)
Balance at June 30, 2022	$	(118,436)	$	(50)	$	(189,730)	$	(308,216)

The amounts reclassified to earnings from the unrecognized net defined benefit plan costs component of accumulated other comprehensive loss for the three and six months ended June 30, 2022 were net (losses) of $(0.7) million and $(1.4) million, respectively, excluding income tax benefits of $0.2 million and $0.4 million, respectively. For the three and six months ended June 30, 2022, these net (losses) consisted of amortization of net actuarial (losses) of $(1.1) million and $(2.2) million and amortization of net prior service credit of $0.4 million and $0.8 million, respectively. Amortization of net actuarial losses and net prior service credit was recorded in other pension and postretirement income in our Condensed Consolidated Statements of Income. See Note 9 for further information.

The amounts reclassified to earnings from the change in fair value of derivatives component of accumulated other comprehensive loss for the three and six months ended June 30, 2022 were not significant.

Other comprehensive loss before reclassifications related to foreign currency translation for the three and six months ended June 30, 2022 consisted of (i) foreign currency (losses) related to translation of quarter end financial statements of foreign subsidiaries utilizing a functional currency other than the U.S. dollar of $(88.7) million and $(85.6) million, respectively, (ii) foreign currency gains related to intra-entity foreign currency transactions that are of a long-term investment nature of $1.1 million and $1.9 million, respectively, and (iii) foreign currency gains related to our net investment hedges of $30.8 million and $42.0 million, respectively, excluding income tax (provisions) of $(7.3) million and $(10.0) million, respectively. See Note 7 for further discussion.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 5.               Inventories

Inventories consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Raw materials	$	362,950	$	302,719	$	394,102
Work-in-process	255,249		164,655		157,406
Finished goods	807,219		534,522		394,378
Other	16,881		15,497		15,731
	1,442,299		1,017,393		961,617
Adjustment to value inventory at cost on the LIFO method	(188,405)		(109,588)		(162,780)
	$	1,253,894	$	907,805	$	798,837

During the three and six months ended June 30, 2022, we implemented an inventory management program which resulted in permanent reductions of inventories valued under the last-in, first-out basis. This resulted in liquidations of inventory layers carried at costs prevailing in prior years and thereby decreased cost of goods sold by $7.3 million for both periods.

Note 6.               Long-Term Debt

Long-term debt consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Bank debt
Bank revolving loans	$	675,000	$	195,859	$	—
U.S. term loans	1,000,000		400,000		1,000,000
Other foreign bank revolving and term loans	61,364		47,132		38,862
Total bank debt	1,736,364		642,991		1,038,862
4¾% Senior Notes	—		300,000		300,000
3¼% Senior Notes	679,510		770,835		739,180
4⅛% Senior Notes	600,000		600,000		600,000
2¼% Senior Notes	522,700		592,950		568,600
1.4% Senior Secured Notes	500,000		500,000		500,000
Finance leases	66,938		33,460		68,730
Total debt - principal	4,105,512		3,440,236		3,815,372
Less unamortized debt issuance costs and debt discount	19,348		22,984		22,195
Total debt	4,086,164		3,417,252		3,793,177
Less current portion	718,695		240,859		20,251
	$	3,367,469	$	3,176,393	$	3,772,926

At June 30, 2022, the current portion of long-term debt consisted of $675.0 million of bank revolving loans under our amended and restated senior secured credit facility, as amended, or the Credit Agreement, $41.0 million of other foreign bank revolving and term loans and $2.7 million of finance leases.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

On March 28, 2022, we redeemed all $300.0 million aggregate principal amount of our outstanding 4¾% Senior Notes due 2025, or the 4¾% Notes, at a redemption price of 100 percent of their principal amount plus accrued and unpaid interest to the redemption date. We funded this redemption with revolving loan borrowings under the Credit Agreement and cash on hand. As a result of this redemption, we recorded a pre-tax charge for the loss on early extinguishment of debt of $1.5 million during the first quarter of 2022 for the write-off of unamortized debt issuance costs.

Note 7.               Financial Instruments

The financial instruments recorded in our Condensed Consolidated Balance Sheets include cash and cash equivalents, trade accounts receivable, trade accounts payable, debt obligations and swap agreements. Due to their short-term maturity, the carrying amounts of trade accounts receivable and trade accounts payable approximate their fair market values. The following table summarizes the carrying amounts and estimated fair values of our other financial instruments at June 30, 2022:

	Carrying Amount		Fair Value
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	247,843	$	247,843
Liabilities:
Bank debt	$	1,736,364	$	1,736,364
3¼% Senior Notes	679,510		643,496
4⅛% Senior Notes	599,258		538,020
2¼% Senior Notes	522,700		412,828
1.4% Senior Secured Notes	499,797		447,200

Fair Value Measurements

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). GAAP classifies the inputs used to measure fair value into a hierarchy consisting of three levels. Level 1 inputs represent unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 inputs represent unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 inputs represent unobservable inputs for the asset or liability. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

Financial Instruments Measured at Fair Value

The financial assets and liabilities that were measured on a recurring basis at June 30, 2022 consisted of our cash and cash equivalents and derivative instruments. We measured the fair value of cash and cash equivalents using Level 1 inputs. We measured the fair value of our derivative instruments using the income approach. The fair value of our derivative instruments reflects the estimated amounts that we would pay or receive based on the present value of the expected cash flows derived from market interest rates and prices. As such, these derivative instruments were classified within Level 2.

Financial Instruments Not Measured at Fair Value

Our bank debt, 3¼% Senior Notes, 4⅛% Senior Notes, 2¼% Senior Notes and 1.4% Senior Secured Notes were recorded at historical amounts in our Condensed Consolidated Balance Sheets, as we have not elected to measure them at fair value. We measured the fair value of our variable rate bank debt using the market approach based on Level 2 inputs. Fair values of the 3¼% Senior Notes, 4⅛% Senior Notes, 2¼% Senior Notes and 1.4% Senior Secured Notes were estimated based on quoted market prices, a Level 1 input.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Derivative Instruments and Hedging Activities

Our derivative financial instruments were recorded in the Condensed Consolidated Balance Sheets at their fair values. Changes in fair values of derivatives are recorded in each period in earnings or comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction.

We utilize certain derivative financial instruments to manage a portion of our interest rate and natural gas cost exposures. We generally limit our use of derivative financial instruments to interest rate and natural gas swap agreements. We do not engage in trading or other speculative uses of these financial instruments. For a financial instrument to qualify as a hedge, we must be exposed to interest rate or price risk, and the financial instrument must reduce the exposure and be designated as a hedge. Financial instruments qualifying for hedge accounting must maintain a high correlation between the hedging instrument and the item being hedged, both at inception and throughout the hedged period.

We also utilize certain internal hedging strategies to minimize our foreign currency exchange rate risk. Net investment hedges that qualify for hedge accounting result in the recognition of foreign currency gains or losses, net of tax, in accumulated other comprehensive loss. 

Interest Rate Swap Agreements

We have entered into two U.S. dollar interest rate swap agreements, each for $50.0 million notional principal amount, to manage a portion of our exposure to interest rate fluctuations. These agreements have a fixed rate of 2.878 percent and mature on March 24, 2023. The difference between amounts to be paid or received on our interest rate swap agreements is recorded in interest and other debt expense in our Condensed Consolidated Statements of Income and was not significant for the three and six months ended June 30, 2022. These agreements are with a financial institution which is expected to fully perform under the terms thereof. The total fair value of our interest rate swap agreements in effect at June 30, 2022 was not significant.

Natural Gas Swap Agreements

We have entered into natural gas swap agreements to manage a portion of our exposure to fluctuations in natural gas prices. The difference between amounts to be paid or received on our natural gas swap agreements is recorded in cost of goods sold in our Condensed Consolidated Statements of Income and was not significant for the three and six months ended June 30, 2022. These agreements are with a financial institution which is expected to fully perform under the terms thereof. The total fair value of our natural gas swap agreements in effect at June 30, 2022 was not significant.

Foreign Currency Exchange Rate Risk

In an effort to minimize our foreign currency exchange rate risk, we have financed acquisitions of foreign operations primarily with borrowings denominated in Euros. In addition, where available, we have borrowed funds in local currency or implemented certain internal hedging strategies to minimize our foreign currency exchange rate risk related to foreign operations, including net investment hedges related to the 3¼% Senior Notes which are Euro denominated. Foreign currency gains related to our net investment hedges included in accumulated other comprehensive loss for the three and six months ended June 30, 2022 were $30.8 million and $42.0 million, respectively.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 8.               Commitments and Contingencies

On July 12, 2022, we announced that we concluded a settlement with the European Commission to end a long-running investigation of our metal packaging operations in Europe. This investigation was started in 2015 by the German antitrust authority and was transferred in 2018 to the European Commission. As part of the settlement, we agreed to pay a fine of $25.2 million to put an end to the investigation, although we do not fully concur with the facts and legal qualifications put forth by the European Commission. The fine will be payable in the fourth quarter of 2022. The European Commission has agreed to close its investigation and not proceed any further with this matter.

We are a party to other legal proceedings, contract disputes and claims arising in the ordinary course of our business. We are not a party to, and none of our properties are subject to, any pending legal proceedings which could have a material adverse effect on our business or financial condition.

Note 9.               Retirement Benefits

The components of the net periodic pension benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	3,270	$	3,789	$	6,570	$	7,577
Interest cost	5,140		4,355		10,299		8,709
Expected return on plan assets	(17,315)		(19,850)		(34,629)		(39,698)
Amortization of prior service cost	53		58		108		116
Amortization of actuarial losses	1,157		3,028		2,312		6,054
Net periodic benefit credit	$	(7,695)	$	(8,620)	$	(15,340)	$	(17,242)

The components of the net periodic other postretirement benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	26	$	28	$	51	$	56
Interest cost	109		95		218		190
Amortization of prior service credit	(416)		(457)		(832)		(913)
Amortization of actuarial gains	(77)		(47)		(154)		(95)
Net periodic benefit credit	$	(358)	$	(381)	$	(717)	$	(762)

Note 10.               Income Taxes

Silgan and its subsidiaries file U.S. Federal income tax returns, as well as income tax returns in various states and foreign jurisdictions. The Internal Revenue Service, or IRS, has completed its review of the 2020 tax year with no change to our filed federal income tax return. We have been accepted into the Compliance Assurance Program for the 2021 and 2022 tax years which provides for the review by the IRS of tax matters relating to our tax return prior to filing.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 11.               Treasury Stock

On March 4, 2022, our Board of Directors authorized the repurchase by us of up to an aggregate of $300.0 million of our common stock by various means from time to time through and including December 31, 2026. During the six months ended June 30, 2022, we repurchased an aggregate of 649,727 shares of our common stock at an average price per share of $40.56, for a total purchase price of $26.4 million. At June 30, 2022, we had approximately $273.6 million remaining under this authorization for the repurchase of our common stock.

During the first six months of 2022, we issued 765,917 treasury shares which had an average cost of $3.19 per share for restricted stock units that vested during the period. In accordance with the Silgan Holdings Inc. Amended and Restated 2004 Stock Incentive Plan, we repurchased 310,904 shares of our common stock at an average cost of $41.92 to satisfy minimum employee withholding tax requirements resulting from the vesting of such restricted stock units.

We account for treasury shares using the first-in, first-out (FIFO) cost method. As of June 30, 2022, 64,896,981 shares of our common stock were held in treasury.

Note 12.             Stock-Based Compensation

We currently have one stock-based compensation plan in effect under which we have issued options and restricted stock units to our officers, other key employees and outside directors. During the first six months of 2022, 429,731 restricted stock units were granted to certain of our officers, other key employees and outside directors. The fair value of these restricted stock units at the grant date was $17.9 million, which is being amortized ratably over the respective vesting period from the grant date.

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Note 13.             Segment Information

Reportable segment information was as follows:

	Dispensing and Specialty Closures		Metal Containers		Custom Containers		Corporate		Total
	(Dollars in thousands)
Three Months Ended June 30, 2022
Net sales	$	602,431	$	754,396	$	186,954	$	—	$	1,543,781
Depreciation and amortization(1)	36,541		19,874		9,934		39		66,388
Rationalization charges	—		3,428		—		—		3,428
Segment income (2)	91,349		66,358		30,890		(30,580)		158,017
Three Months Ended June 30, 2021
Net sales	$	545,768	$	624,534	$	178,359	$	—	$	1,348,661
Depreciation and amortization(1)	29,101		21,329		9,632		42		60,104
Rationalization charges	67		225		62		—		354
Segment income	73,836		58,635		27,244		(6,761)		152,954
Six Months Ended June 30, 2022
Net sales	$	1,200,358	$	1,405,122	$	380,187	$	—	$	2,985,667
Depreciation and amortization(1)	73,160		40,938		19,817		81		133,996
Rationalization charges	—		4,702		105		—		4,807
Segment income (2)	178,662		104,367		55,584		(37,204)		301,409
Six Months Ended June 30, 2021
Net sales	$	1,055,120	$	1,178,615	$	353,036	$	—	$	2,586,771
Depreciation and amortization(1)	57,991		42,578		19,005		81		119,655
Rationalization charges	5,298		5,246		167		—		10,711
Segment income	139,481		104,249		51,730		(15,957)		279,503

_____________

(1)Depreciation and amortization excludes amortization of debt discount and debt issuance costs of $1.3 million and $1.4 million for the three months ended June 30, 2022 and 2021, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2022 and 2021, respectively.

(2)Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.

Total segment income is reconciled to income before income taxes as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Total segment income	$	158,017	$	152,954	$	301,409	$	279,503
Interest and other debt expense	28,660		26,406		59,490		53,712
Income before income taxes	$	129,357	$	126,548	$	241,919	$	225,791

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SILGAN HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Information at June 30, 2022 and 2021 and for the

three and six months then ended is unaudited)

Sales and segment income of our metal containers segment and of part of our dispensing and specialty closures segment are dependent, in part, upon the vegetable and fruit harvests in the United States and, to a lesser extent, in a variety of national growing regions in Europe. The size and quality of these harvests varies from year to year, depending in large part upon the weather conditions in applicable regions. Because of the seasonality of the harvests, we have historically experienced higher unit sales volume in the third quarter of our fiscal year and generated a disproportionate amount of our annual segment income during that quarter.

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Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Statements included in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q that 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 Securities Exchange Act of 1934, as amended.  Such forward-looking statements are made based upon management’s expectations and beliefs concerning future events impacting us and therefore involve a number of uncertainties and risks, including, but not limited to, those described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and in our other filings with the Securities and Exchange Commission.  As a result, the actual results of our operations or our financial condition could differ materially from those expressed or implied in these forward-looking statements.

General

We are a leading manufacturer of sustainable rigid packaging solutions for consumer goods products.  We currently produce dispensing and specialty closures for food, beverage, health care, garden, home, personal care, fragrance and beauty products; steel and aluminum containers for human and pet food and general line products; and custom designed plastic containers for personal care, food, health care, pharmaceutical, household and industrial chemical, pet food and care, agricultural, automotive and marine chemical products. We are a leading worldwide manufacturer of dispensing and specialty closures, a leading manufacturer of metal containers in North America and Europe, and a leading manufacturer of custom containers in North America for a variety of markets, including the personal care, food, health care and household and industrial chemical markets.

Our objective is to increase shareholder value by efficiently deploying capital and management resources to grow our business, reduce operating costs and build sustainable competitive positions, or franchises, and to complete acquisitions that generate attractive cash returns.  We have grown our net sales and income from operations largely through acquisitions but also through internal growth, and we continue to evaluate acquisition opportunities in the consumer goods packaging market.  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.

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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				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Net sales
Dispensing and Specialty Closures	39.0	%	40.5	%	40.2	%	40.8	%
Metal Containers	48.9		46.3		47.1		45.6
Custom Containers	12.1		13.2		12.7		13.6
Consolidated	100.0		100.0		100.0		100.0
Cost of goods sold	82.3		82.6		83.0		82.4
Gross profit	17.7		17.4		17.0		17.6
Selling, general and administrative expenses	8.0		7.0		7.5		7.4
Rationalization charges	0.2		—		0.2		0.4
Other pension and postretirement income	(0.7)		(0.9)		(0.8)		(1.0)
Income before interest and income taxes	10.2		11.3		10.1		10.8
Interest and other debt expense	1.8		1.9		2.0		2.1
Income before income taxes	8.4		9.4		8.1		8.7
Provision for income taxes	2.4		2.4		2.2		2.2
Net income	6.0	%	7.0	%	5.9	%	6.5	%

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

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(dollars in millions)
Net sales
Dispensing and Specialty Closures	$	602.4	$	545.8	$	1,200.4	$	1,055.1
Metal Containers	754.4		624.5		1,405.1		1,178.6
Custom Containers	187.0		178.4		380.2		353.1
Consolidated	$	1,543.8	$	1,348.7	$	2,985.7	$	2,586.8
Segment income
Dispensing and Specialty Closures (1)	$	91.3	$	73.8	$	178.7	$	139.5
Metal Containers (2)	66.4		58.6		104.4		104.2
Custom Containers (3)	30.9		27.2		55.6		51.7
Corporate (4)	(30.6)		(6.6)		(37.3)		(15.9)
Consolidated	$	158.0	$	153.0	$	301.4	$	279.5

(1) Includes rationalization charges of $0.1 million and $5.3 million for the three and six months ended June 30, 2021, respectively.

(2) Includes rationalization charges of $3.4 million and $0.2 million for the three months ended June 30, 2022 and 2021, respectively, and $4.7 million and $5.2 million for the six months ended June 30, 2022 and 2021, respectively.

(3) Includes rationalization charges of $0.1 million for the three months ended June 30, 2021 and $0.1 million and $0.2 million for the six months ended June 30, 2022 and 2021, respectively.

(4)    Includes a charge of $25.2 million for the settlement with the European Commission for the three and six months ended June 30, 2022.

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Three Months Ended June 30, 2022 Compared with Three Months Ended June 30, 2021

Overview.  Consolidated net sales were $1.54 billion in the second quarter of 2022, a 14.5 percent increase as compared to the second quarter of 2021 primarily due to higher average selling prices due to the pass through of higher raw material and other inflationary costs across all segments, higher unit volumes in the dispensing and specialty closures segment and a more favorable mix of products sold in the custom containers segment, partially offset by lower unit volumes and a higher percentage of smaller cans sold in the metal containers segment, the impact from unfavorable foreign currency translation and lower volumes in the custom containers segment. Income before interest and income taxes for the second quarter of 2022 was $158.0 million, a $5.0 million increase as compared to the same period in 2021 primarily as a result of higher average selling prices across all segments due to the pass through of higher raw material and other inflationary costs, strong operating performances in each of the segments, the benefit from inventory management programs in the dispensing and specialty closures and metal containers segments, cost recovery of certain customer project expenditures in the dispensing and specialty closures segment, the favorable impact in the current year period from the delayed pass through of lower resin costs as compared to the unfavorable impact in the prior year period from the delayed pass through of higher resin costs in the dispensing and specialty closures and custom containers segments and higher unit volumes in the dispensing and specialty closures segment. These increases were partially offset by inflation in manufacturing costs, higher corporate expenses due to the charge for the settlement with the European Commission in the current year period, lower volumes in the metal containers and custom containers segments, the impact of unfavorable foreign currency translation, the mix impact of more smaller cans sold in the metal containers segment and higher rationalization charges. Results for the second quarters of 2022 and 2021 included rationalization charges of $3.4 million and $0.4 million, respectively. Net income for the second quarter of 2022 was $92.7 million as compared to $94.5 million for the same period in 2021.  Net income per diluted share for the second quarter of 2022 was $0.83 as compared to $0.85 for the same period in 2021.

Net Sales.  The $195.1 million increase in consolidated net sales in the second quarter of 2022 as compared to the second quarter of 2021 was the result of higher net sales across all the segments.

Net sales for the dispensing and specialty closures segment increased $56.6 million, or 10.4 percent, in the second quarter of 2022 as compared to the same period in 2021. This increase was primarily the result of higher average selling prices due to the pass through of higher raw material and other inflationary costs and higher unit volumes of approximately two percent, partially offset by the impact of unfavorable foreign currency translation of approximately $29 million. The increase in unit volumes was principally the result of the inclusion of the recent acquisitions and higher volumes for beauty and fragrance products, partially offset by a decrease in trigger sprayers for garden, hygiene and home cleaning products, which were impacted by further inventory corrections throughout the supply chain, and in closures for certain food and beverage products, which were unfavorably impacted by other supply chain disruptions at certain customers.

Net sales for the metal containers segment increased $129.9 million, or 20.8 percent, in the second quarter of 2022 as compared to the same period in 2021.  This increase was primarily the result of higher average selling prices due to the pass through of higher raw material and other manufacturing costs, partially offset by lower unit volumes of approximately ten percent, the impact of unfavorable foreign currency translation of approximately $14 million and a higher percentage of smaller cans sold. The decrease in unit volumes was principally the result of expected lower volumes of vegetable cans as compared to restocking activity in the prior year period and the impact from customers’ ongoing supply chain, labor and energy challenges in the current year period.

Net sales for the custom containers segment increased $8.6 million, or 4.8 percent, in the second quarter of 2022 as compared to the same period in 2021. This increase was principally due to higher average selling prices which include the pass through of higher resin and other inflationary costs and a more favorable mix of products sold, partially offset by lower volumes of approximately seven percent and the impact of unfavorable foreign currency translation of approximately $1 million. The decline in volumes was primarily for garden, hygiene and home cleaning products principally due to further inventory corrections throughout the supply chain.

Gross Profit.  Gross profit margin increased 0.3 percentage points to 17.7 percent in the second quarter of 2022 as compared to the same period in 2021 for the reasons discussed below in "Income before Interest and Income Taxes."

Selling, General and Administrative Expenses.  Selling, general and administrative expenses as a percentage of consolidated net sales increased to 8.0 percent in the second quarter of 2022 as compared to 7.0 percent in the same period in 2021. Selling, general and administrative expenses increased $29.4 million to $123.8 million for the second quarter of 2022 as compared to $94.4 million for the same period in 2021. The increase in selling, general and administrative expenses was principally the result of a charge of $25.2 million for the settlement with the European Commission and the inclusion of selling, general and administrative expenses from the operations acquired in the third and fourth quarters of 2021.

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Income before Interest and Income Taxes.  Income before interest and income taxes for the second quarter of 2022 increased by $5.0 million as compared to the second quarter of 2021, while margins decreased to 10.2 percent from 11.3 percent over the same periods. The increase in income before interest and income taxes was primarily the result of higher income in all of the segments, partially offset by higher corporate expenses due to the $25.2 million settlement with the European Commission and higher rationalization charges. Rationalization charges were $3.4 million and $0.4 million in the second quarters of 2022 and 2021, respectively.

Segment income of the dispensing and specialty closures segment for the second quarter of 2022 increased $17.5 million as compared to the same period in 2021, and segment income margin increased to 15.2 percent from 13.5 percent over the same periods.  The increase in segment income was primarily due to higher average selling prices due to the pass through of inflationary costs, strong operating performance including the benefit of an inventory management program to significantly reduce working capital, cost recovery for certain customer project expenditures, the favorable impact in the current year period from the delayed pass through of lower resin costs as compared to the unfavorable impact in the prior year period from the delayed pass through of higher resin costs and higher unit volumes, partially offset by inflation in manufacturing costs and the impact of unfavorable foreign currency translation.

Segment income of the metal containers segment for the second quarter of 2022 increased $7.8 million as compared to the same period in 2021, while segment income margin decreased to 8.8 percent from 9.4 percent over the same periods. The increase in segment income was due primarily to higher average selling prices as a result of the pass through of inflationary costs and strong operating performance including the benefit from inventory management, partially offset by inflation in manufacturing costs, lower unit volumes, the mix impact of more smaller cans sold, higher rationalization charges and the impact of unfavorable foreign currency translation. The decrease in segment income margin was primarily due to the mathematical consequence of the pass through of inflation in raw material and other manufacturing costs in the second quarter of 2022. Rationalization charges were $3.4 million and $0.2 million in the second quarters of 2022 and 2021, respectively.

Segment income of the custom containers segment for the second quarter of 2022 increased $3.7 million as compared to the same period in 2021, and segment income margin increased to 16.5 percent from 15.2 percent over the same periods.  The increase in segment income was primarily attributable to higher average selling prices due to the pass through of inflationary costs, strong operating performance and the favorable impact in the current year period from the delayed pass through of lower resin costs as compared to the unfavorable impact in the prior year period from the delayed pass through of higher resin costs, partially offset by inflation in manufacturing costs and lower volumes.

Interest and Other Debt Expense. Interest and other debt expense before loss on early extinguishment of debt for the second quarter of 2022 increased $2.3 million to $28.7 million as compared to $26.4 million in the same period in 2021. This increase was primarily due to higher weighted average outstanding borrowings during the quarter as a result of the acquisitions completed in the third and fourth quarters of 2021, partially offset by lower weighted average interest rates as a result of the redemption of the 4¾% Notes with proceeds from revolving loan borrowings under the Credit Agreement and cash on hand.

Provision for Income Taxes. The effective tax rates were 28.4 percent and 25.3 percent for the second quarters of 2022 and 2021, respectively. The effective tax rate in the second quarter of 2022 was unfavorably impacted by the non-deductible settlement with the European Commission.

Six Months Ended June 30, 2022 Compared with Six Months Ended June 30, 2021

Overview.  Consolidated net sales were $2.99 billion in the first six months of 2022, a 15.4 percent increase as compared to the first six months of 2021 primarily as a result of higher average selling prices across all segments principally related to the pass through of higher raw material and other inflationary costs, higher unit volumes in the dispensing and specialty closures segment and a more favorable mix of products sold in the custom containers segment, partially offset by lower volumes in the metal containers and custom containers segments, the impact of unfavorable foreign currency translation and a higher percentage of smaller cans sold in the metal containers segment. Income before interest and income taxes for the first six months of 2022 increased by $21.9 million as compared to the same period in 2021 primarily due to higher average selling prices across all segments principally due to the pass through of higher raw material and other inflationary costs, strong operating performances in each of the segments, the benefits from inventory management programs in the dispensing and specialty closures and metal containers segments, the favorable impact from the delayed pass through of lower resin costs in the current year period as compared to the unfavorable impact in the prior year period from the delayed pass through of higher resin costs in the dispensing and specialty closures and custom containers segments, higher unit volumes in the dispensing and specialty closures segment, cost recovery for certain customer project expenditures in the dispensing and specialty closures

-21-

segment and lower rationalization charges. These increases were partially offset by inflation in manufacturing costs, lower volumes in the metal containers and custom containers segments, higher corporate expenses due to the charge for the settlement with the European Commission in the current year period, the mix impact of more smaller cans sold in the metal containers segment and the impact of unfavorable foreign currency translation. Results for the first six months of 2022 and 2021 included rationalization charges of $4.8 million and $10.7 million, respectively, and a loss on early extinguishment of debt of $1.5 million and $0.9 million, respectively. Net income for the first six months of 2022 was $177.6 million as compared to $167.8 million for the same period in 2021. Net income per diluted share for the first six months of 2022 was $1.59 as compared to $1.51 for the same period in 2021.

Net Sales.  The $398.9 million increase in consolidated net sales in the first six months of 2022 as compared to the first six months of 2021 was the result of higher net sales across all the segments.

Net sales for the dispensing and specialty closures segment increased $145.3 million, or 13.8 percent, in the first six months of 2022 as compared to the same period in 2021. This increase was primarily the result of higher average selling prices related to the pass through of higher raw material and other inflationary costs and higher unit volumes of approximately four percent, partially offset by the impact of unfavorable foreign currency translation of approximately $44 million. The increase in unit volumes was principally the result of the inclusion of volumes from the recent acquisitions and higher volumes for beauty and fragrance products, partially offset by a decrease in volumes for garden, hygiene and home cleaning products, which were impacted by further inventory corrections throughout the supply chain, and for closures as a result of customer pre-buy activity in late 2021 in advance of significant metal inflation this year and other supply chain disruptions at certain customers.

Net sales for the metal containers segment increased $226.5 million, or 19.2 percent, in the first six months of 2022 as compared to the same period in 2021. This increase was primarily the result of higher average selling prices related to the pass through of higher raw material and other manufacturing costs, partially offset by lower unit volumes of approximately twelve percent, the impact of unfavorable foreign currency translation of approximately $21 million and a higher percentage of smaller cans sold. The decrease in unit volumes was primarily due to the impact of the customer pre-buy activity in late 2021 in advance of significant price increases due to unprecedented metal inflation this year, lower volumes of vegetable cans as compared to restocking activity in the prior year period and customers' ongoing supply chain, labor and energy challenges in the current year period.

Net sales for the custom containers segment increased $27.1 million, or 7.7 percent, in the first six months of 2022 as compared to the same period in 2021. This increase was primarily due to higher average selling prices which include the pass through of higher resin and other inflationary costs and a more favorable mix of products sold, partially offset by lower volumes of approximately eight percent and the impact of unfavorable foreign currency translation of approximately $1 million. The decrease in volumes was primarily due to higher volumes in the prior year period as a result of strong pandemic driven demand and subsequent inventory corrections throughout the supply chain in the current year period.

Gross Profit.  Gross profit margin decreased 0.6 percentage points to 17.0 percent in the first six months of 2022 as compared to the same period in 2021 for the reasons discussed below in "Income before Interest and Income Taxes".

Selling, General and Administrative Expenses.  Selling, general and administrative expenses as a percentage of consolidated net sales increased to 7.5 percent for the first six months of 2022 as compared to 7.4 percent in the same period in 2021. Selling, general and administrative expenses increased $32.0 million to $223.8 million for the first six months of 2022 as compared to $191.8 million for the same period in 2021. The increase in selling, general and administrative expenses was principally the result of a charge of $25.2 million for the settlement with the European Commission and the inclusion of selling, general and administrative expenses from the operations acquired in the third and fourth quarters of 2021.

Income before Interest and Income Taxes.  Income before interest and income taxes for the first six months of 2022 increased by $21.9 million as compared to the first six months of 2021, while margins decreased to 10.1 percent from 10.8 percent over the same periods. The increase in income before interest and income taxes was primarily due to higher income across all the segments and lower rationalization charges, partially offset by higher corporate expenses due to the $25.2 million settlement with the European Commission. Rationalization charges were $4.8 million and $10.7 million for the first six months of 2022 and 2021, respectively.

Segment income of the dispensing and specialty closures segment for the first six months of 2022 increased $39.2 million as compared to the same period in 2021, and segment income margin increased to 14.9 percent from 13.2 percent over the same period. The increase in segment income was due primarily to higher average selling prices principally as a result of the pass through of higher raw material and other inflationary costs, strong operating performance including the benefit from an inventory management program, the favorable impact from the delayed pass through of lower resin costs in the current year

-22-

period as compared to the unfavorable impact in the prior year period from the delayed pass through of higher resin costs, higher unit volumes, cost recovery for certain customer project expenditures and lower rationalization charges, partially offset by inflation in manufacturing costs and the impact of unfavorable foreign currency translation. Rationalization charges were $5.3 million in the first six months of 2021.

Segment income of the metal containers segment for the first six months of 2022 increased $0.2 million as compared to the same period in 2021, while segment income margin decreased to 7.4 percent from 8.8 percent over the same periods. The increase in segment income was primarily attributable to higher average selling prices due to the pass through of higher raw material and other inflationary costs, strong operating performance including the benefit from an inventory management program and lower rationalization charges, partially offset by inflation in manufacturing costs, lower unit volumes, the mix impact of more smaller cans sold and the impact of unfavorable foreign currency translation. The decrease in segment income margin was primarily due to the mathematical consequence of the pass through of inflation in raw material and other manufacturing costs. Rationalization charges were $4.7 million and $5.2 million in the first six months of 2022 and 2021, respectively.

Segment income of the custom containers segment for the first six months of 2022 increased $3.9 million as compared to the same period in 2021, and segment income margin remained unchanged at 14.6 percent over the same periods. The increase in segment income was primarily attributable higher average selling prices principally due to the pass through of higher raw material and other inflationary costs, strong operating performance and the favorable impact from the delayed pass through of lower resin costs in the current year period as compared to the unfavorable impact of the delayed pass through of higher resin costs in the prior year period, partially offset by inflation in manufacturing costs and lower volumes.

Interest and Other Debt Expense. Interest and other debt expense before loss on early extinguishment of debt for the first six months of 2022 increased $5.2 million to $58.0 million as compared to $52.8 million in the same period in 2021 principally due to higher weighted average outstanding borrowings as a result of the acquisitions completed in 2021, partially offset by lower weighted average interest rates as a result of the redemption of the 4¾% Notes with proceeds from revolving loan borrowings under the Credit Agreement and cash on hand. In March 2022, we redeemed all $300.0 million aggregate principal amount of the outstanding 4¾% Notes. In conjunction with this redemption, we recognized a loss on early extinguishment of debt of $1.5 million in the first quarter of 2022. In February 2021, we issued the 1.4% Senior Secured Notes and utilized the proceeds therefrom to prepay outstanding term loans under the Credit Agreement. In conjunction with this prepayment, we recognized a loss on early extinguishment of debt of $0.9 million in the first quarter of 2021.

Provision for Income Taxes. The effective tax rates were 26.6 percent and 25.7 percent for the first six months of 2022 and 2021, respectively. The effective tax rate in 2022 was unfavorably impacted by the non-deductible settlement with the European Commission in the second quarter of 2022.

CAPITAL RESOURCES AND LIQUIDITY

Our principal sources of liquidity have been net cash from operating activities and borrowings under our debt instruments, including our senior secured credit facility. 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 March 28, 2022, we redeemed all $300.0 million aggregate principal amount of the outstanding 4¾% Notes at a redemption price of 100 percent of their principal amount plus accrued and unpaid interest to the redemption date. We funded this redemption with revolving loan borrowings under the Credit Agreement and cash on hand. As a result of this redemption, we recorded a pre-tax charge for the loss on early extinguishment of debt of $1.5 million during the first quarter of 2022 for the write-off of unamortized debt issuance costs.

You should also read Note 6 to our Condensed Consolidated Financial Statements for the three and six months ended June 30, 2022 included elsewhere in this Quarterly Report.

For the six months ended June 30, 2022, we used net borrowings of revolving loans of $698.9 million and cash and cash equivalents of $383.6 million to fund the redemption of the 4¾% Notes for $300.0 million, cash used in operations of $351.9 million, decreases in outstanding checks of $225.9 million, net capital expenditures and other investing activities of $120.4 million, repurchases of our common stock of $39.4 million, dividends paid on our common stock of $36.7 million and the negative effect of exchange rate changes on cash and cash equivalents of $8.2 million.

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For the six months ended June 30, 2021, we used proceeds from the issuance of the 1.4% Senior Secured Notes of $499.7 million, net borrowings of revolving loans of $212.2 million and cash and cash equivalents of $244.7 million to fund repayments of long-term debt of $500.0 million, cash used in operations of $209.3 million, net capital expenditures and other investing activities of $116.4 million, decreases in outstanding checks of $84.2 million, dividends paid on our common stock of $31.6 million, repurchases of our common stock of $8.5 million under our stock-based compensation plan, debt issuance costs of $4.9 million and the negative effect of exchange rate changes on cash and cash equivalents of $1.7 million.

At June 30, 2022, we had $675.0 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 June 30, 2022 was $805.3 million.

Because we sell metal containers and closures used in fruit and vegetable pack processing, we have seasonal sales.  As is common in the industry, we must utilize working capital to build inventory and then carry accounts receivable for some customers beyond the end of the packing season.  Due to our seasonal requirements, which generally peak sometime in the summer or early fall, we may incur short-term indebtedness to finance our working capital requirements.  Our peak seasonal working capital requirements have historically averaged approximately $350 million. 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 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.  We continue to evaluate acquisition opportunities in the consumer goods packaging market and may incur additional indebtedness, including indebtedness under the Credit Agreement, to finance any such acquisition.

We are in compliance with all financial and operating covenants contained in our financing agreements and believe that we will continue to be in compliance during 2022 with all of these covenants.

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. 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 June 30, 2022 and December 31, 2021 and for the six months ended June 30, 2022. 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 $1.4 billion as of each of June 30, 2022 and December 31, 2021 are not included in noncurrent assets in the table below.

	June 30, 2022	Dec. 31, 2021
	(Dollars in millions)
Current assets	$1,656.6	$1,506.9
Noncurrent assets	4,120.6	4,159.9
Current liabilities	1,553.0	1,159.2
Noncurrent liabilities	4,008.6	4,392.4

At June 30, 2022 and December 31, 2021, the Obligor Group held current receivables due from other subsidiary companies of $41.5 million and $70.5 million, respectively; long-term notes receivable due from other subsidiary companies of $731.2 million and $782.4 million, respectively; and current payables due to other subsidiary companies of $5.4 million and $7.3 million, respectively.

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	Six Months Ended June 30, 2022
	(Dollars in millions)
Net sales	$2,160.6
Gross profit	309.3
Net income	127.2

For the six months ended June 30, 2022, net income in the table above excludes income from equity method investments of other subsidiary companies of $50.4 million. For the six months ended June 30, 2022, the Obligor Group recorded the following transactions with other subsidiary companies: sales to such other subsidiary companies of $21.2 million; net credits from such other subsidiary companies of $38.0 million; and net interest income from such other subsidiary companies of $10.1 million. For the six months ended June 30, 2022, the Obligor Group received dividends from other subsidiary companies of $1.7 million.

Rationalization Charges

We continually evaluate cost reduction opportunities across each of our segments, including rationalizations of our existing facilities through plant closings and downsizings. We use a disciplined approach to identify opportunities that generate attractive cash returns. Under our rationalization plans, we made cash payments of $4.3 million and $3.5 million for the six months ended June 30, 2022 and 2021, 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 $3.8 million and $7.4 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 $0.9 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 $3.1 million annually through 2040.

You should also read Note 3 to our Condensed Consolidated Financial Statements for the three and six months ended June 30, 2022 included elsewhere in this Quarterly Report.

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Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risks relating to our operations result primarily from changes in interest rates and, with respect to our international operations, in foreign currency exchange rates.  In the normal course of business, we also have risk related to commodity price changes for items such as natural gas.  We employ established policies and procedures to manage our exposure to these risks.  Interest rate, foreign currency and commodity pricing transactions are used only to the extent considered necessary to meet our objectives.  We do not utilize derivative financial instruments for trading or other speculative purposes.

Information regarding our interest rate risk, foreign currency exchange rate risk and commodity pricing risk has been disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.  Since such filing, other than the changes discussed in Notes 6 and 7 to our Condensed Consolidated Financial Statements for the three and six months ended June 30, 2022 included elsewhere in this Quarterly Report, there has not been a material change to our interest rate risk, foreign currency exchange rate risk or commodity pricing risk or to our policies and procedures to manage our exposure to these risks.

Item 4.  CONTROLS AND PROCEDURES

As required by Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, we carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures.  Based upon that evaluation, as of the end of the period covered by this Quarterly Report, our Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that our disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including the Principal Executive Officer and the Principal Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

There were no changes in our internal controls over financial reporting during the period covered by this Quarterly Report that have materially affected, or are reasonably likely to materially affect, these internal controls.

In 2021, we acquired Gateway Plastics LLC, Unicep Packaging LLC and Easytech Closures S.p.A. We are currently in the process of integrating the internal controls and procedures of these acquired entities into our internal controls over financial reporting. As provided under the Sarbanes-Oxley Act of 2002 and the applicable rules and regulations of the Securities and Exchange Commission, we will include the internal controls and procedures of these acquired entities in our annual assessment of the effectiveness of our internal control over financial reporting for our 2022 fiscal year.

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Part II.  Other Information

Item 1. Legal Proceedings

On July 12, 2022, we announced that we concluded a settlement with the European Commission to end a long-running investigation of our metal packaging operations in Europe. This investigation was started in 2015 by the German antitrust authority and was transferred in 2018 to the European Commission. As part of the settlement, we agreed to pay a fine of €23,852,000 to put an end to the investigation, although we do not fully concur with the facts and legal qualifications put forth by the European Commission. The fine will be payable in the fourth quarter of 2022. The European Commission has agreed to close its investigation and not proceed any further with this matter.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

(c) Purchases of Equity Securities By the Issuer and Affiliated Purchasers

The following table provides information about shares of our common stock that we repurchased during the second quarter of 2022:

ISSUER PURCHASES OF EQUITY SECURITIES
				(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) (1)
	(a) Total Number of Shares Purchased
		(b) Average Price Paid per Share
April 1-30, 2022	—	$	—	—	$	300.0
May 1-31, 2022	10,967	$	41.94	10,967	$	299.5
June 1-30, 2022	638,760	$	40.54	638,760	$	273.6
Total	649,727	$	40.56	649,727	$	273.6

(1) On March 4, 2022, our Board of Directors authorized the repurchase by us of up to an aggregate of $300.0 million of our common stock by various means from time to time through and including December 31, 2026.

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Item 6.  Exhibits

Exhibit Number	Description
*22	Subsidiary Guarantors and Issuers of Guaranteed Securities.
*31.1	Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act.
*31.2	Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act.
*32.1	Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act.
*32.2	Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act.
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

___________________ 

*Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	SILGAN HOLDINGS INC.
Dated: August 4, 2022	/s/ Robert B. Lewis
	Robert B. Lewis
	Executive Vice President and
	Chief Financial Officer
	(Principal Financial and
	Accounting Officer)

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EX-22

Exhibit 22

Subsidiary Guarantors and Issuers of Guaranteed Securities

The following subsidiaries (the "Obligor Group") of Silgan Holdings Inc. (the "Issuer") were, as of June 30, 2022, guarantors of the Issuer's 3¼% Senior Notes due 2025, 4⅛% Senior Notes due 2028, 2¼% Senior Notes due 2028, and 1.4% Senior Secured Notes due 2026:

Name of Subsidiary	Jurisdiction of Organization
Silgan Holdings LLC	Delaware
Silgan Corporation	Delaware
Silgan Containers LLC	Delaware
Silgan Containers Manufacturing Corporation	Delaware
Silgan White Cap LLC	Delaware
Silgan White Cap Corporation	Delaware
Silgan White Cap Americas LLC	Delaware
Silgan Equipment Company	Delaware
Silgan ipec Corporation	Delaware
Silgan Closures International Holding Company	Delaware
Silgan Plastics LLC	Delaware
Silgan Plastics Corporation	Delaware
Silgan Plastic Food Containers Corporation	Delaware
Silgan Tubes Holding Company	Delaware
Portola Packaging LLC	Delaware
Silgan Dispensing Systems Holdings Company	Delaware
Silgan Dispensing Systems Corporation	Delaware
Silgan Dispensing Systems Slatersville LLC	Rhode Island
Silgan Dispensing Systems Metal Holdings Corporation	Delaware
Silgan Dispensing Systems Covit America Corporation	Delaware
Silgan Dispensing Systems Metal Real Estate Corporation	Delaware
Silgan Dispensing Systems Thomaston Corporation	Delaware
Silgan Specialty Packaging LLC	Delaware
Silgan Unicep Packaging LLC	Delaware

EX-31.1

Exhibit 31.1

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT

I, Adam J. Greenlee, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of Silgan Holdings Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 4, 2022	/s/ Adam J. Greenlee
	Adam J. Greenlee
	President and
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT

I, Robert B. Lewis, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of Silgan Holdings Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  August 4, 2022	/s/ Robert B. Lewis
	Robert B. Lewis
	Executive Vice President and
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT

In connection with the Quarterly Report of Silgan Holdings Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Quarterly Report”), I, Adam J. Greenlee, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Adam J. Greenlee

Adam J. Greenlee

President and

Chief Executive Officer

August 4, 2022

A signed original of this written statement required by Section 906 has been provided to Silgan Holdings Inc. and will be retained by Silgan Holdings Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT

In connection with the Quarterly Report of Silgan Holdings Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Quarterly Report”), I, Robert B. Lewis, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Robert B. Lewis

Robert B. Lewis

Executive Vice President and

Chief Financial Officer

August 4, 2022

A signed original of this written statement required by Section 906 has been provided to Silgan Holdings Inc. and will be retained by Silgan Holdings Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover - shares	6 Months Ended
	Jun. 30, 2022	Jul. 29, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2022
Document Transition Report	false
Entity File Number	000-22117
Entity Registrant Name	SILGAN HOLDINGS INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	06-1269834
Entity Address, Address Line One	4 Landmark Square
Entity Address, City or Town	Stamford,
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06901
City Area Code	203
Local Phone Number	975-7110
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	SLGN
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		110,215,515
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
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Current Fiscal Year End Date	--12-31

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021
Current assets:
Cash and cash equivalents	$ 247,843	$ 631,439	$ 164,821
Trade accounts receivable, net	931,282	711,332	891,812
Inventories	1,253,894	798,837	907,805
Prepaid expenses and other current assets	120,133	154,241	88,818
Total current assets	2,553,152	2,295,849	2,053,256
Property, plant and equipment, net	1,932,805	1,993,877	1,832,885
Goodwill	1,966,136	2,038,408	1,719,815
Other intangible assets, net	785,976	830,772	609,882
Other assets, net	636,430	611,940	508,481
Assets, total	7,874,499	7,770,846	6,724,319
Current liabilities:
Revolving loans and current portion of long-term debt	718,695	20,251	240,859
Trade accounts payable	880,862	1,133,318	727,523
Accrued payroll and related costs	109,211	109,279	112,270
Accrued liabilities	251,271	245,674	234,503
Total current liabilities	1,960,039	1,508,522	1,315,155
Long-term debt	3,367,469	3,772,926	3,176,393
Deferred income taxes	430,147	435,252	360,027
Other liabilities	491,381	491,450	484,164
Stockholders’ equity:
Common stock	1,751	1,751	1,751
Paid-in capital	331,877	325,448	314,873
Retained earnings	2,833,431	2,691,745	2,531,783
Accumulated other comprehensive loss	(308,216)	(259,828)	(263,433)
Treasury stock	(1,233,380)	(1,196,420)	(1,196,394)
Total stockholders’ equity	1,625,463	1,562,696	1,388,580
Liabilities and equity, total	$ 7,874,499	$ 7,770,846	$ 6,724,319

XML

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2022		Jun. 30, 2021	Jun. 30, 2022		Jun. 30, 2021
Income Statement [Abstract]
Net sales	$ 1,543,781		$ 1,348,661	$ 2,985,667		$ 2,586,771
Cost of goods sold	1,269,855		1,113,777	2,478,288		2,130,421
Gross profit	273,926		234,884	507,379		456,350
Selling, general and administrative expenses	123,830		94,394	223,841		191,773
Rationalization charges	3,428		354	4,807		10,711
Other pension and postretirement income	(11,349)		(12,818)	(22,678)		(25,637)
Income before interest and income taxes	158,017	[1]	152,954	301,409	[1]	279,503
Interest and other debt expense before loss on early extinguishment of debt	28,660		26,406	58,009		52,829
Loss on early extinguishment of debt	0		0	1,481		883
Interest and other debt expense	28,660		26,406	59,490		53,712
Income before income taxes	129,357		126,548	241,919		225,791
Provision for income taxes	36,682		32,072	64,369		58,034
Net income	$ 92,675		$ 94,476	$ 177,550		$ 167,757
Earnings per share
Basic net income per share (usd per share)	$ 0.84		$ 0.86	$ 1.60		$ 1.52
Diluted net income per share (usd per share)	$ 0.83		$ 0.85	$ 1.59		$ 1.51
Weighted average number of shares
Basic (in shares)	110,840		110,442	110,750		110,323
Effect of dilutive securities (in shares)	388		661	590		743
Diluted (in shares)	111,228		111,103	111,340		111,066

[1] Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.

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Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Statement of Comprehensive Income [Abstract]
Net income	$ 92,675	$ 94,476	$ 177,550	$ 167,757
Other comprehensive income (loss), net of tax:
Changes in net prior service credit and actuarial losses	539	1,876	1,038	3,754
Change in fair value of derivatives	(60)	828	2,277	1,469
Foreign currency translation	(64,053)	25,669	(51,703)	(7,703)
Other comprehensive (loss) income	(63,574)	28,373	(48,388)	(2,480)
Comprehensive income	$ 29,101	$ 122,849	$ 129,162	$ 165,277

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Cash flows provided by (used in) operating activities:
Net income	$ 177,550	$ 167,757
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	136,790	122,386
Rationalization charges	4,807	10,711
Stock compensation expense	8,870	10,337
Loss on early extinguishment of debt	1,481	883
Other changes that provided (used) cash, net of effects from acquisitions:
Trade accounts receivable, net	(243,261)	(277,768)
Inventories	(475,171)	(233,815)
Trade accounts payable	15,331	31,825
Accrued liabilities	15,914	(24,316)
Other, net	5,753	(17,313)
Net cash used in operating activities	(351,936)	(209,313)
Cash flows provided by (used in) investing activities:
Purchase of businesses, net of cash acquired	(1,333)	2,305
Capital expenditures	(118,357)	(123,604)
Other, net	(688)	4,914
Net cash used in investing activities	(120,378)	(116,385)
Cash flows provided by (used in) financing activities:
Borrowings under revolving loans	753,657	318,141
Repayments under revolving loans	(54,815)	(105,856)
Proceeds from issuance of long-term debt	0	499,725
Repayments of long-term debt	(300,000)	(500,000)
Changes in outstanding checks - principally vendors	(225,863)	(84,216)
Dividends paid on common stock	(36,680)	(31,564)
Debt issuance costs	0	(4,905)
Repurchase of common stock	(39,402)	(8,538)
Net cash provided by financing activities	96,897	82,787
Effect of exchange rate changes on cash and cash equivalents	(8,179)	(1,749)
Cash and cash equivalents:
Net decrease	(383,596)	(244,660)
Balance at beginning of year	631,439	409,481
Balance at end of period	247,843	164,821
Interest paid, net	59,297	48,026
Income taxes paid, net	$ 28,881	$ 47,297

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Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Treasury Stock
Beginning balance at Dec. 31, 2020		$ 1,751	$ 306,363	$ 2,395,395	$ (260,953)	$ (1,189,683)
Beginning balance (in shares) at Dec. 31, 2020		110,057
Increase (Decrease) in Stockholders' Equity
Net issuance of treasury stock for vested restricted stock units (in shares)		351
Repurchase of common stock (in shares)		0
Stock compensation expense			10,337
Net issuance of treasury stock for vested restricted stock units			(1,827)			(6,711)
Net income	$ 167,757			167,757
Dividends declared on common stock				(31,369)
Other comprehensive (loss) income					(2,480)
Repurchases of common stock						0
Ending balance at Jun. 30, 2021	$ 1,388,580	$ 1,751	314,873	2,531,783	(263,433)	(1,196,394)
Ending balance (in shares) at Jun. 30, 2021		110,408
Increase (Decrease) in Stockholders' Equity
Dividends declared on common stock per share (usd per share)	$ 0.28
Beginning balance at Mar. 31, 2021		$ 1,751	309,635	2,452,996	(291,806)	(1,196,221)
Beginning balance (in shares) at Mar. 31, 2021		110,386
Increase (Decrease) in Stockholders' Equity
Net issuance of treasury stock for vested restricted stock units (in shares)		22
Repurchase of common stock (in shares)		0
Stock compensation expense			5,327
Net issuance of treasury stock for vested restricted stock units			(89)			(173)
Net income	$ 94,476			94,476
Dividends declared on common stock				(15,689)
Other comprehensive (loss) income					28,373
Repurchases of common stock						0
Ending balance at Jun. 30, 2021	$ 1,388,580	$ 1,751	314,873	2,531,783	(263,433)	(1,196,394)
Ending balance (in shares) at Jun. 30, 2021		110,408
Increase (Decrease) in Stockholders' Equity
Dividends declared on common stock per share (usd per share)	$ 0.14
Beginning balance at Dec. 31, 2021	$ 1,562,696	$ 1,751	325,448	2,691,745	(259,828)	(1,196,420)
Beginning balance (in shares) at Dec. 31, 2021		110,410
Increase (Decrease) in Stockholders' Equity
Net issuance of treasury stock for vested restricted stock units (in shares)		455
Repurchase of common stock (in shares)		(650)
Stock compensation expense			8,870
Net issuance of treasury stock for vested restricted stock units			(2,441)			(10,593)
Net income	177,550			177,550
Dividends declared on common stock				(35,864)
Other comprehensive (loss) income					(48,388)
Repurchases of common stock						(26,367)
Ending balance at Jun. 30, 2022	$ 1,625,463	$ 1,751	331,877	2,833,431	(308,216)	(1,233,380)
Ending balance (in shares) at Jun. 30, 2022		110,215
Increase (Decrease) in Stockholders' Equity
Dividends declared on common stock per share (usd per share)	$ 0.32
Beginning balance at Mar. 31, 2022		$ 1,751	328,201	2,758,697	(244,642)	(1,205,768)
Beginning balance (in shares) at Mar. 31, 2022		110,800
Increase (Decrease) in Stockholders' Equity
Net issuance of treasury stock for vested restricted stock units (in shares)		65
Repurchase of common stock (in shares)		(650)
Stock compensation expense			3,991
Net issuance of treasury stock for vested restricted stock units			(315)			(1,245)
Net income	$ 92,675			92,675
Dividends declared on common stock				(17,941)
Other comprehensive (loss) income					(63,574)
Repurchases of common stock						(26,367)
Ending balance at Jun. 30, 2022	$ 1,625,463	$ 1,751	$ 331,877	$ 2,833,431	$ (308,216)	$ (1,233,380)
Ending balance (in shares) at Jun. 30, 2022		110,215
Increase (Decrease) in Stockholders' Equity
Dividends declared on common stock per share (usd per share)	$ 0.16

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Silgan Holdings Inc., or Silgan, have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying financial statements include all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation. The results of operations for any interim period are not necessarily indicative of the results of operations for the full year.

The Condensed Consolidated Balance Sheet at December 31, 2021 has been derived from our audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements.

You should read the accompanying condensed consolidated financial statements in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

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Revenue

6 Months Ended

Jun. 30, 2022

Revenue Recognition [Abstract]

Revenue

Revenue

The following tables present our revenues disaggregated by reportable segment and geography as they best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenues by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	602,431	$	545,768	$	1,200,358	$	1,055,120
Metal Containers	754,396		624,534		1,405,122		1,178,615
Custom Containers	186,954		178,359		380,187		353,036
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

Revenues by geography were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
North America	$	1,154,614	$	968,497	$	2,240,838	$	1,866,899
Europe and other	389,167		380,164		744,829		719,872
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

Our contract assets primarily consist of unbilled accounts receivable related to over time revenue recognition and were $110.3 million, $92.6 million, and $78.2 million as of June 30, 2022 and 2021 and December 31, 2021, respectively. Unbilled receivables are included in trade accounts receivable, net on our Condensed Consolidated Balance Sheets.

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Rationalization Charges

6 Months Ended

Jun. 30, 2022

Restructuring and Related Activities [Abstract]

Rationalization Charges

Rationalization Charges

We continually evaluate cost reduction opportunities across each of our segments, including rationalizations of our existing facilities through plant closings and downsizings. We use a disciplined approach to identify opportunities that generate attractive cash returns. Rationalization charges by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	—	$	67	$	—	$	5,298
Metal Containers	3,428		225		4,702		5,246
Custom Containers	—		62		105		167
	$	3,428	$	354	$	4,807	$	10,711

Activity in reserves for our rationalization plans were as follows:

	Employee Severance and Benefits		Plant Exit Costs		Non-Cash Asset Write-Down		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	41,090	$	157	$	—	$	41,247
Charged to expense	3,833		737		237		4,807
Utilized and currency translation	(3,519)		(737)		(237)		(4,493)
Balance at June 30, 2022	$	41,404	$	157	$	—	$	41,561

Non-cash asset write-downs were the result of comparing the carrying value of certain production related assets to their fair value using estimated future discounted cash flows, a Level 3 fair value measurement (see Note 7 for information regarding a Level 3 fair value measurement).

Rationalization reserves as of June 30, 2022 were recorded in our Condensed Consolidated Balance Sheet as accrued liabilities of $5.0 million and other liabilities of $36.6 million. Excluding the impact of our withdrawal from the Central States, Southeast and Southwest Areas Pension Plan, or the Central States Pension Plan, in 2019, remaining expenses and cash expenditures for our rationalization plans are expected to be $3.8 million and $7.4 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 $0.9 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 $3.1 million annually through 2040.

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Accumulated Other Comprehensive Loss

6 Months Ended

Jun. 30, 2022

Equity [Abstract]

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss is reported in our Condensed Consolidated Statements of Stockholders’ Equity.  Amounts included in accumulated other comprehensive loss, net of tax, were as follows:

 

	Unrecognized Net Defined Benefit Plan Costs		Change in Fair Value of Derivatives		Foreign Currency Translation		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	(119,474)	$	(2,327)	$	(138,027)	$	(259,828)
Other comprehensive loss before reclassifications	—		2,257		(51,703)		(49,446)
Amounts reclassified from accumulated other     comprehensive loss	1,038		20		—		1,058
Other comprehensive loss	1,038		2,277		(51,703)		(48,388)
Balance at June 30, 2022	$	(118,436)	$	(50)	$	(189,730)	$	(308,216)

The amounts reclassified to earnings from the unrecognized net defined benefit plan costs component of accumulated other comprehensive loss for the three and six months ended June 30, 2022 were net (losses) of $(0.7) million and $(1.4) million, respectively, excluding income tax benefits of $0.2 million and $0.4 million, respectively. For the three and six months ended June 30, 2022, these net (losses) consisted of amortization of net actuarial (losses) of $(1.1) million and $(2.2) million and amortization of net prior service credit of $0.4 million and $0.8 million, respectively. Amortization of net actuarial losses and net prior service credit was recorded in other pension and postretirement income in our Condensed Consolidated Statements of Income. See Note 9 for further information.

The amounts reclassified to earnings from the change in fair value of derivatives component of accumulated other comprehensive loss for the three and six months ended June 30, 2022 were not significant.

Other comprehensive loss before reclassifications related to foreign currency translation for the three and six months ended June 30, 2022 consisted of (i) foreign currency (losses) related to translation of quarter end financial statements of foreign subsidiaries utilizing a functional currency other than the U.S. dollar of $(88.7) million and $(85.6) million, respectively, (ii) foreign currency gains related to intra-entity foreign currency transactions that are of a long-term investment nature of $1.1 million and $1.9 million, respectively, and (iii) foreign currency gains related to our net investment hedges of $30.8 million and $42.0 million, respectively, excluding income tax (provisions) of $(7.3) million and $(10.0) million, respectively. See Note 7 for further discussion.

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Inventories

6 Months Ended

Jun. 30, 2022

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Raw materials	$	362,950	$	302,719	$	394,102
Work-in-process	255,249		164,655		157,406
Finished goods	807,219		534,522		394,378
Other	16,881		15,497		15,731
	1,442,299		1,017,393		961,617
Adjustment to value inventory at cost on the LIFO method	(188,405)		(109,588)		(162,780)
	$	1,253,894	$	907,805	$	798,837

During the three and six months ended June 30, 2022, we implemented an inventory management program which resulted in permanent reductions of inventories valued under the last-in, first-out basis. This resulted in liquidations of inventory layers carried at costs prevailing in prior years and thereby decreased cost of goods sold by $7.3 million for both periods.

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Long-Term Debt

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Long-term debt consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Bank debt
Bank revolving loans	$	675,000	$	195,859	$	—
U.S. term loans	1,000,000		400,000		1,000,000
Other foreign bank revolving and term loans	61,364		47,132		38,862
Total bank debt	1,736,364		642,991		1,038,862
4¾% Senior Notes	—		300,000		300,000
3¼% Senior Notes	679,510		770,835		739,180
4⅛% Senior Notes	600,000		600,000		600,000
2¼% Senior Notes	522,700		592,950		568,600
1.4% Senior Secured Notes	500,000		500,000		500,000
Finance leases	66,938		33,460		68,730
Total debt - principal	4,105,512		3,440,236		3,815,372
Less unamortized debt issuance costs and debt discount	19,348		22,984		22,195
Total debt	4,086,164		3,417,252		3,793,177
Less current portion	718,695		240,859		20,251
	$	3,367,469	$	3,176,393	$	3,772,926

At June 30, 2022, the current portion of long-term debt consisted of $675.0 million of bank revolving loans under our amended and restated senior secured credit facility, as amended, or the Credit Agreement, $41.0 million of other foreign bank revolving and term loans and $2.7 million of finance leases.

On March 28, 2022, we redeemed all $300.0 million aggregate principal amount of our outstanding 4¾% Senior Notes due 2025, or the 4¾% Notes, at a redemption price of 100 percent of their principal amount plus accrued and unpaid interest to the redemption date. We funded this redemption with revolving loan borrowings under the Credit Agreement and cash on hand. As a result of this redemption, we recorded a pre-tax charge for the loss on early extinguishment of debt of $1.5 million during the first quarter of 2022 for the write-off of unamortized debt issuance costs.

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Financial Instruments

6 Months Ended

Jun. 30, 2022

Investments, All Other Investments [Abstract]

Financial Instruments

Financial Instruments

The financial instruments recorded in our Condensed Consolidated Balance Sheets include cash and cash equivalents, trade accounts receivable, trade accounts payable, debt obligations and swap agreements. Due to their short-term maturity, the carrying amounts of trade accounts receivable and trade accounts payable approximate their fair market values. The following table summarizes the carrying amounts and estimated fair values of our other financial instruments at June 30, 2022:

	Carrying Amount		Fair Value
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	247,843	$	247,843
Liabilities:
Bank debt	$	1,736,364	$	1,736,364
3¼% Senior Notes	679,510		643,496
4⅛% Senior Notes	599,258		538,020
2¼% Senior Notes	522,700		412,828
1.4% Senior Secured Notes	499,797		447,200

Fair Value Measurements

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). GAAP classifies the inputs used to measure fair value into a hierarchy consisting of three levels. Level 1 inputs represent unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 inputs represent unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 inputs represent unobservable inputs for the asset or liability. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

Financial Instruments Measured at Fair Value

The financial assets and liabilities that were measured on a recurring basis at June 30, 2022 consisted of our cash and cash equivalents and derivative instruments. We measured the fair value of cash and cash equivalents using Level 1 inputs. We measured the fair value of our derivative instruments using the income approach. The fair value of our derivative instruments reflects the estimated amounts that we would pay or receive based on the present value of the expected cash flows derived from market interest rates and prices. As such, these derivative instruments were classified within Level 2.

Financial Instruments Not Measured at Fair Value

Our bank debt, 3¼% Senior Notes, 4⅛% Senior Notes, 2¼% Senior Notes and 1.4% Senior Secured Notes were recorded at historical amounts in our Condensed Consolidated Balance Sheets, as we have not elected to measure them at fair value. We measured the fair value of our variable rate bank debt using the market approach based on Level 2 inputs. Fair values of the 3¼% Senior Notes, 4⅛% Senior Notes, 2¼% Senior Notes and 1.4% Senior Secured Notes were estimated based on quoted market prices, a Level 1 input.

Derivative Instruments and Hedging Activities

Our derivative financial instruments were recorded in the Condensed Consolidated Balance Sheets at their fair values. Changes in fair values of derivatives are recorded in each period in earnings or comprehensive income, depending on whether a derivative is designated as part of a hedge transaction and, if it is, the type of hedge transaction.

We utilize certain derivative financial instruments to manage a portion of our interest rate and natural gas cost exposures. We generally limit our use of derivative financial instruments to interest rate and natural gas swap agreements. We do not engage in trading or other speculative uses of these financial instruments. For a financial instrument to qualify as a hedge, we must be exposed to interest rate or price risk, and the financial instrument must reduce the exposure and be designated as a hedge. Financial instruments qualifying for hedge accounting must maintain a high correlation between the hedging instrument and the item being hedged, both at inception and throughout the hedged period.

We also utilize certain internal hedging strategies to minimize our foreign currency exchange rate risk. Net investment hedges that qualify for hedge accounting result in the recognition of foreign currency gains or losses, net of tax, in accumulated other comprehensive loss. 

Interest Rate Swap Agreements

We have entered into two U.S. dollar interest rate swap agreements, each for $50.0 million notional principal amount, to manage a portion of our exposure to interest rate fluctuations. These agreements have a fixed rate of 2.878 percent and mature on March 24, 2023. The difference between amounts to be paid or received on our interest rate swap agreements is recorded in interest and other debt expense in our Condensed Consolidated Statements of Income and was not significant for the three and six months ended June 30, 2022. These agreements are with a financial institution which is expected to fully perform under the terms thereof. The total fair value of our interest rate swap agreements in effect at June 30, 2022 was not significant.

Natural Gas Swap Agreements

We have entered into natural gas swap agreements to manage a portion of our exposure to fluctuations in natural gas prices. The difference between amounts to be paid or received on our natural gas swap agreements is recorded in cost of goods sold in our Condensed Consolidated Statements of Income and was not significant for the three and six months ended June 30, 2022. These agreements are with a financial institution which is expected to fully perform under the terms thereof. The total fair value of our natural gas swap agreements in effect at June 30, 2022 was not significant.

Foreign Currency Exchange Rate Risk

In an effort to minimize our foreign currency exchange rate risk, we have financed acquisitions of foreign operations primarily with borrowings denominated in Euros. In addition, where available, we have borrowed funds in local currency or implemented certain internal hedging strategies to minimize our foreign currency exchange rate risk related to foreign operations, including net investment hedges related to the 3¼% Senior Notes which are Euro denominated. Foreign currency gains related to our net investment hedges included in accumulated other comprehensive loss for the three and six months ended June 30, 2022 were $30.8 million and $42.0 million, respectively.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

On July 12, 2022, we announced that we concluded a settlement with the European Commission to end a long-running investigation of our metal packaging operations in Europe. This investigation was started in 2015 by the German antitrust authority and was transferred in 2018 to the European Commission. As part of the settlement, we agreed to pay a fine of $25.2 million to put an end to the investigation, although we do not fully concur with the facts and legal qualifications put forth by the European Commission. The fine will be payable in the fourth quarter of 2022. The European Commission has agreed to close its investigation and not proceed any further with this matter.

We are a party to other legal proceedings, contract disputes and claims arising in the ordinary course of our business. We are not a party to, and none of our properties are subject to, any pending legal proceedings which could have a material adverse effect on our business or financial condition.

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Retirement Benefits

6 Months Ended

Jun. 30, 2022

Retirement Benefits [Abstract]

Retirement Benefits

Retirement Benefits

The components of the net periodic pension benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	3,270	$	3,789	$	6,570	$	7,577
Interest cost	5,140		4,355		10,299		8,709
Expected return on plan assets	(17,315)		(19,850)		(34,629)		(39,698)
Amortization of prior service cost	53		58		108		116
Amortization of actuarial losses	1,157		3,028		2,312		6,054
Net periodic benefit credit	$	(7,695)	$	(8,620)	$	(15,340)	$	(17,242)

The components of the net periodic other postretirement benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	26	$	28	$	51	$	56
Interest cost	109		95		218		190
Amortization of prior service credit	(416)		(457)		(832)		(913)
Amortization of actuarial gains	(77)		(47)		(154)		(95)
Net periodic benefit credit	$	(358)	$	(381)	$	(717)	$	(762)

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Income Taxes	6 Months Ended
	Jun. 30, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Income TaxesSilgan and its subsidiaries file U.S. Federal income tax returns, as well as income tax returns in various states and foreign jurisdictions. The Internal Revenue Service, or IRS, has completed its review of the 2020 tax year with no change to our filed federal income tax return. We have been accepted into the Compliance Assurance Program for the 2021 and 2022 tax years which provides for the review by the IRS of tax matters relating to our tax return prior to filing.

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Treasury Stock

6 Months Ended

Jun. 30, 2022

Equity [Abstract]

Treasury Stock

Treasury Stock

On March 4, 2022, our Board of Directors authorized the repurchase by us of up to an aggregate of $300.0 million of our common stock by various means from time to time through and including December 31, 2026. During the six months ended June 30, 2022, we repurchased an aggregate of 649,727 shares of our common stock at an average price per share of $40.56, for a total purchase price of $26.4 million. At June 30, 2022, we had approximately $273.6 million remaining under this authorization for the repurchase of our common stock.

During the first six months of 2022, we issued 765,917 treasury shares which had an average cost of $3.19 per share for restricted stock units that vested during the period. In accordance with the Silgan Holdings Inc. Amended and Restated 2004 Stock Incentive Plan, we repurchased 310,904 shares of our common stock at an average cost of $41.92 to satisfy minimum employee withholding tax requirements resulting from the vesting of such restricted stock units.

We account for treasury shares using the first-in, first-out (FIFO) cost method. As of June 30, 2022, 64,896,981 shares of our common stock were held in treasury.

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Stock-Based Compensation	6 Months Ended
	Jun. 30, 2022
Share-Based Payment Arrangement [Abstract]
Stock-Based Compensation	Stock-Based CompensationWe currently have one stock-based compensation plan in effect under which we have issued options and restricted stock units to our officers, other key employees and outside directors. During the first six months of 2022, 429,731 restricted stock units were granted to certain of our officers, other key employees and outside directors. The fair value of these restricted stock units at the grant date was $17.9 million, which is being amortized ratably over the respective vesting period from the grant date.

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Segment Information

6 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information

Reportable segment information was as follows:

	Dispensing and Specialty Closures		Metal Containers		Custom Containers		Corporate		Total
	(Dollars in thousands)
Three Months Ended June 30, 2022
Net sales	$	602,431	$	754,396	$	186,954	$	—	$	1,543,781
Depreciation and amortization(1)	36,541		19,874		9,934		39		66,388
Rationalization charges	—		3,428		—		—		3,428
Segment income (2)	91,349		66,358		30,890		(30,580)		158,017
Three Months Ended June 30, 2021
Net sales	$	545,768	$	624,534	$	178,359	$	—	$	1,348,661
Depreciation and amortization(1)	29,101		21,329		9,632		42		60,104
Rationalization charges	67		225		62		—		354
Segment income	73,836		58,635		27,244		(6,761)		152,954
Six Months Ended June 30, 2022
Net sales	$	1,200,358	$	1,405,122	$	380,187	$	—	$	2,985,667
Depreciation and amortization(1)	73,160		40,938		19,817		81		133,996
Rationalization charges	—		4,702		105		—		4,807
Segment income (2)	178,662		104,367		55,584		(37,204)		301,409
Six Months Ended June 30, 2021
Net sales	$	1,055,120	$	1,178,615	$	353,036	$	—	$	2,586,771
Depreciation and amortization(1)	57,991		42,578		19,005		81		119,655
Rationalization charges	5,298		5,246		167		—		10,711
Segment income	139,481		104,249		51,730		(15,957)		279,503

_____________

(1)Depreciation and amortization excludes amortization of debt discount and debt issuance costs of $1.3 million and $1.4 million for the three months ended June 30, 2022 and 2021, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2022 and 2021, respectively.

(2)Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.

Total segment income is reconciled to income before income taxes as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Total segment income	$	158,017	$	152,954	$	301,409	$	279,503
Interest and other debt expense	28,660		26,406		59,490		53,712
Income before income taxes	$	129,357	$	126,548	$	241,919	$	225,791

Sales and segment income of our metal containers segment and of part of our dispensing and specialty closures segment are dependent, in part, upon the vegetable and fruit harvests in the United States and, to a lesser extent, in a variety of national growing regions in Europe. The size and quality of these harvests varies from year to year, depending in large part upon the weather conditions in applicable regions. Because of the seasonality of the harvests, we have historically experienced higher unit sales volume in the third quarter of our fiscal year and generated a disproportionate amount of our annual segment income during that quarter.

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Silgan Holdings Inc., or Silgan, have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying financial statements include all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation. The results of operations for any interim period are not necessarily indicative of the results of operations for the full year.

The Condensed Consolidated Balance Sheet at December 31, 2021 has been derived from our audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements.

You should read the accompanying condensed consolidated financial statements in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021.

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Revenue (Tables)

6 Months Ended

Jun. 30, 2022

Revenue Recognition [Abstract]

Disaggregation of Revenue

Revenues by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	602,431	$	545,768	$	1,200,358	$	1,055,120
Metal Containers	754,396		624,534		1,405,122		1,178,615
Custom Containers	186,954		178,359		380,187		353,036
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

Revenues by geography were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
North America	$	1,154,614	$	968,497	$	2,240,838	$	1,866,899
Europe and other	389,167		380,164		744,829		719,872
	$	1,543,781	$	1,348,661	$	2,985,667	$	2,586,771

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Rationalization Charges (Tables)

6 Months Ended

Jun. 30, 2022

Restructuring and Related Activities [Abstract]

Activity in Rationalization Plan Reserves

Rationalization charges by segment were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Dispensing and Specialty Closures	$	—	$	67	$	—	$	5,298
Metal Containers	3,428		225		4,702		5,246
Custom Containers	—		62		105		167
	$	3,428	$	354	$	4,807	$	10,711

Activity in reserves for our rationalization plans were as follows:

	Employee Severance and Benefits		Plant Exit Costs		Non-Cash Asset Write-Down		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	41,090	$	157	$	—	$	41,247
Charged to expense	3,833		737		237		4,807
Utilized and currency translation	(3,519)		(737)		(237)		(4,493)
Balance at June 30, 2022	$	41,404	$	157	$	—	$	41,561

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Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Jun. 30, 2022

Equity [Abstract]

Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax

Amounts included in accumulated other comprehensive loss, net of tax, were as follows: 

	Unrecognized Net Defined Benefit Plan Costs		Change in Fair Value of Derivatives		Foreign Currency Translation		Total
	(Dollars in thousands)
Balance at December 31, 2021	$	(119,474)	$	(2,327)	$	(138,027)	$	(259,828)
Other comprehensive loss before reclassifications	—		2,257		(51,703)		(49,446)
Amounts reclassified from accumulated other     comprehensive loss	1,038		20		—		1,058
Other comprehensive loss	1,038		2,277		(51,703)		(48,388)
Balance at June 30, 2022	$	(118,436)	$	(50)	$	(189,730)	$	(308,216)

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Inventories (Tables)

6 Months Ended

Jun. 30, 2022

Inventory Disclosure [Abstract]

Inventories

Inventories consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Raw materials	$	362,950	$	302,719	$	394,102
Work-in-process	255,249		164,655		157,406
Finished goods	807,219		534,522		394,378
Other	16,881		15,497		15,731
	1,442,299		1,017,393		961,617
Adjustment to value inventory at cost on the LIFO method	(188,405)		(109,588)		(162,780)
	$	1,253,894	$	907,805	$	798,837

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Long-Term Debt (Tables)

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

Long-term Debt

Long-term debt consisted of the following: 

	June 30, 2022		June 30, 2021		Dec. 31, 2021
	(Dollars in thousands)
Bank debt
Bank revolving loans	$	675,000	$	195,859	$	—
U.S. term loans	1,000,000		400,000		1,000,000
Other foreign bank revolving and term loans	61,364		47,132		38,862
Total bank debt	1,736,364		642,991		1,038,862
4¾% Senior Notes	—		300,000		300,000
3¼% Senior Notes	679,510		770,835		739,180
4⅛% Senior Notes	600,000		600,000		600,000
2¼% Senior Notes	522,700		592,950		568,600
1.4% Senior Secured Notes	500,000		500,000		500,000
Finance leases	66,938		33,460		68,730
Total debt - principal	4,105,512		3,440,236		3,815,372
Less unamortized debt issuance costs and debt discount	19,348		22,984		22,195
Total debt	4,086,164		3,417,252		3,793,177
Less current portion	718,695		240,859		20,251
	$	3,367,469	$	3,176,393	$	3,772,926

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Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2022

Investments, All Other Investments [Abstract]

Summary of Carrying Amounts and Estimated Fair Values of Other Financial Instruments

The following table summarizes the carrying amounts and estimated fair values of our other financial instruments at June 30, 2022:

	Carrying Amount		Fair Value
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	247,843	$	247,843
Liabilities:
Bank debt	$	1,736,364	$	1,736,364
3¼% Senior Notes	679,510		643,496
4⅛% Senior Notes	599,258		538,020
2¼% Senior Notes	522,700		412,828
1.4% Senior Secured Notes	499,797		447,200

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Retirement Benefits (Tables)

6 Months Ended

Jun. 30, 2022

Retirement Benefits [Abstract]

Components of Net Periodic Benefit Cost

The components of the net periodic pension benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	3,270	$	3,789	$	6,570	$	7,577
Interest cost	5,140		4,355		10,299		8,709
Expected return on plan assets	(17,315)		(19,850)		(34,629)		(39,698)
Amortization of prior service cost	53		58		108		116
Amortization of actuarial losses	1,157		3,028		2,312		6,054
Net periodic benefit credit	$	(7,695)	$	(8,620)	$	(15,340)	$	(17,242)

The components of the net periodic other postretirement benefit credit were as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Service cost	$	26	$	28	$	51	$	56
Interest cost	109		95		218		190
Amortization of prior service credit	(416)		(457)		(832)		(913)
Amortization of actuarial gains	(77)		(47)		(154)		(95)
Net periodic benefit credit	$	(358)	$	(381)	$	(717)	$	(762)

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Reportable Operating Segment Information

Reportable segment information was as follows:

	Dispensing and Specialty Closures		Metal Containers		Custom Containers		Corporate		Total
	(Dollars in thousands)
Three Months Ended June 30, 2022
Net sales	$	602,431	$	754,396	$	186,954	$	—	$	1,543,781
Depreciation and amortization(1)	36,541		19,874		9,934		39		66,388
Rationalization charges	—		3,428		—		—		3,428
Segment income (2)	91,349		66,358		30,890		(30,580)		158,017
Three Months Ended June 30, 2021
Net sales	$	545,768	$	624,534	$	178,359	$	—	$	1,348,661
Depreciation and amortization(1)	29,101		21,329		9,632		42		60,104
Rationalization charges	67		225		62		—		354
Segment income	73,836		58,635		27,244		(6,761)		152,954
Six Months Ended June 30, 2022
Net sales	$	1,200,358	$	1,405,122	$	380,187	$	—	$	2,985,667
Depreciation and amortization(1)	73,160		40,938		19,817		81		133,996
Rationalization charges	—		4,702		105		—		4,807
Segment income (2)	178,662		104,367		55,584		(37,204)		301,409
Six Months Ended June 30, 2021
Net sales	$	1,055,120	$	1,178,615	$	353,036	$	—	$	2,586,771
Depreciation and amortization(1)	57,991		42,578		19,005		81		119,655
Rationalization charges	5,298		5,246		167		—		10,711
Segment income	139,481		104,249		51,730		(15,957)		279,503

_____________

(1)Depreciation and amortization excludes amortization of debt discount and debt issuance costs of $1.3 million and $1.4 million for the three months ended June 30, 2022 and 2021, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2022 and 2021, respectively.

(2)Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.

Reconciliation of Segment Income from Operations to Income before Income Taxes

Total segment income is reconciled to income before income taxes as follows:

	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
	(Dollars in thousands)
Total segment income	$	158,017	$	152,954	$	301,409	$	279,503
Interest and other debt expense	28,660		26,406		59,490		53,712
Income before income taxes	$	129,357	$	126,548	$	241,919	$	225,791

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Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Segment Reporting Information [Line Items]
Net sales	$ 1,543,781	$ 1,348,661	$ 2,985,667	$ 2,586,771
Trade Accounts Receivable | Unbilled Accounts Receivable
Segment Reporting Information [Line Items]
Contract assets	110,300	92,600	110,300	92,600	$ 78,200
North America
Segment Reporting Information [Line Items]
Net sales	1,154,614	968,497	2,240,838	1,866,899
Europe and other
Segment Reporting Information [Line Items]
Net sales	389,167	380,164	744,829	719,872
Dispensing and Specialty Closures
Segment Reporting Information [Line Items]
Net sales	602,431	545,768	1,200,358	1,055,120
Metal Containers
Segment Reporting Information [Line Items]
Net sales	754,396	624,534	1,405,122	1,178,615
Custom Containers
Segment Reporting Information [Line Items]
Net sales	$ 186,954	$ 178,359	$ 380,187	$ 353,036

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Rationalization Charges - Rationalization Charges by Business Segment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Restructuring Cost and Reserve [Line Items]
Rationalization charges	$ 3,428	$ 354	$ 4,807	$ 10,711
Dispensing and Specialty Closures
Restructuring Cost and Reserve [Line Items]
Rationalization charges	0	67	0	5,298
Metal Containers
Restructuring Cost and Reserve [Line Items]
Rationalization charges	3,428	225	4,702	5,246
Custom Containers
Restructuring Cost and Reserve [Line Items]
Rationalization charges	$ 0	$ 62	$ 105	$ 167

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Rationalization Charges - Activity in Rationalization Plan Reserves (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Restructuring Reserve [Roll Forward]
Balance at December 31, 2021			$ 41,247
Charged to expense	$ 3,428	$ 354	4,807	$ 10,711
Utilized and currency translation			(4,493)
Balance at June 30, 2022	41,561		41,561
Employee Severance and Benefits
Restructuring Reserve [Roll Forward]
Balance at December 31, 2021			41,090
Charged to expense			3,833
Utilized and currency translation			(3,519)
Balance at June 30, 2022	41,404		41,404
Plant Exit Costs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2021			157
Charged to expense			737
Utilized and currency translation			(737)
Balance at June 30, 2022	157		157
Non-Cash Asset Write-Down
Restructuring Reserve [Roll Forward]
Balance at December 31, 2021			0
Charged to expense			237
Utilized and currency translation			(237)
Balance at June 30, 2022	$ 0		$ 0

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Rationalization Charges - Narrative (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Restructuring Cost and Reserve [Line Items]
Restructuring reserve	$ 41,561	$ 41,247
Other Restructuring | Rationalization Plan
Restructuring Cost and Reserve [Line Items]
Remaining expenses	3,800
Remaining cash expenditures	7,400
Annually Through 2040 | Central States Pension Plan withdrawal
Restructuring Cost and Reserve [Line Items]
Remaining cash expenditures	3,100
Accretion expense	900
Accrued Liabilities
Restructuring Cost and Reserve [Line Items]
Restructuring reserve	5,000
Other Liabilities
Restructuring Cost and Reserve [Line Items]
Restructuring reserve	$ 36,600

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Accumulated Other Comprehensive Loss - Amounts Included in Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			$ 1,562,696
Other comprehensive loss before reclassifications			(49,446)
Amounts reclassified from accumulated other comprehensive loss			1,058
Other comprehensive (loss) income	$ (63,574)	$ 28,373	(48,388)	$ (2,480)
Ending balance	1,625,463	1,388,580	1,625,463	1,388,580
Accumulated Other Comprehensive Loss
Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(244,642)	(291,806)	(259,828)	(260,953)
Ending balance	(308,216)	$ (263,433)	(308,216)	$ (263,433)
Unrecognized Net Defined Benefit Plan Costs
Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			(119,474)
Other comprehensive loss before reclassifications			0
Amounts reclassified from accumulated other comprehensive loss			1,038
Other comprehensive (loss) income			1,038
Ending balance	(118,436)		(118,436)
Change in Fair Value of Derivatives
Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			(2,327)
Other comprehensive loss before reclassifications			2,257
Amounts reclassified from accumulated other comprehensive loss			20
Other comprehensive (loss) income			2,277
Ending balance	(50)		(50)
Foreign Currency Translation
Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			(138,027)
Other comprehensive loss before reclassifications			(51,703)
Amounts reclassified from accumulated other comprehensive loss			0
Other comprehensive (loss) income			(51,703)
Ending balance	$ (189,730)		$ (189,730)

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Accumulated Other Comprehensive Loss - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2022
Unrecognized Net Defined Benefit Plan Costs
Accumulated Other Comprehensive Income (Loss) [Line Items]
Other comprehensive (loss) reclassification adjustment from AOCI	$ (0.7)	$ (1.4)
Benefit for income taxes	0.2	0.4
Amortization of net actuarial (losses), before tax	(1.1)	(2.2)
Net prior service credit arising during period, before tax	0.4	0.8
Accumulated Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Foreign currency gains (losses)	(88.7)	(85.6)
Foreign currency transaction and translation gain (loss) arising during period related to intra-entity transactions of a long-term investment nature, net of tax	1.1	1.9
Foreign currency (losses) gains of net investment hedges included in accumulated other comprehensive loss	30.8	42.0
Foreign currency translation, tax benefit (provision) related to net investment hedges	$ (7.3)	$ (10.0)

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Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 362,950	$ 394,102	$ 302,719
Work-in-process	255,249	157,406	164,655
Finished goods	807,219	394,378	534,522
Other	16,881	15,731	15,497
Inventories, gross	1,442,299	961,617	1,017,393
Adjustment to value inventory at cost on the LIFO method	(188,405)	(162,780)	(109,588)
Inventories	$ 1,253,894	$ 798,837	$ 907,805

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Inventories - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2022
Cost of Goods Sold
Inventory [Line Items]
Effect of LIFO inventory liquidation on cost of goods sold	$ 7.3	$ 7.3

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Long-Term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021
Debt Instrument [Line Items]
Total debt - principal	$ 4,105,512	$ 3,815,372	$ 3,440,236
Less unamortized debt issuance costs and debt discount	19,348	22,195	22,984
Debt long term and short term less unamortized debt issuance costs and debt discount	4,086,164	3,793,177	3,417,252
Less current portion	718,695	20,251	240,859
Long-term debt	3,367,469	3,772,926	3,176,393
Bank debt
Debt Instrument [Line Items]
Total debt - principal	1,736,364	1,038,862	642,991
Finance Leases
Debt Instrument [Line Items]
Total debt - principal	66,938	68,730	33,460
Bank Revolving Loans | Bank debt
Debt Instrument [Line Items]
Total debt - principal	675,000	0	195,859
Less current portion	675,000
U S Term Loans | Bank debt
Debt Instrument [Line Items]
Total debt - principal	1,000,000	1,000,000	400,000
Other Foreign Bank Revolving and Term Loans | Bank debt
Debt Instrument [Line Items]
Total debt - principal	61,364	38,862	47,132
Less current portion	41,000
Senior Notes | 4¾% Notes
Debt Instrument [Line Items]
Total debt - principal	$ 0	300,000	300,000
Senior note interest rate	4.75%
Senior Notes | 3¼% Senior Notes
Debt Instrument [Line Items]
Total debt - principal	$ 679,510	739,180	770,835
Senior note interest rate	3.25%
Senior Notes | 4⅛% Senior Notes
Debt Instrument [Line Items]
Total debt - principal	$ 600,000	600,000	600,000
Senior note interest rate	4.125%
Senior Notes | 2¼% Senior Notes
Debt Instrument [Line Items]
Total debt - principal	$ 522,700	568,600	592,950
Senior note interest rate	2.25%
Senior Notes | 1.4% Senior Secured Notes
Debt Instrument [Line Items]
Total debt - principal	$ 500,000	$ 500,000	$ 500,000
Senior note interest rate	1.40%
Finance Leases
Debt Instrument [Line Items]
Less current portion	$ 2,700

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Long-Term Debt - Narrative (Details) - USD ($)		3 Months Ended			6 Months Ended
	Mar. 28, 2022	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Debt Instrument [Line Items]
Long-term debt, current maturities		$ 718,695,000		$ 240,859,000	$ 718,695,000	$ 240,859,000	$ 20,251,000
Loss on early extinguishment of debt		0		$ 0	1,481,000	$ 883,000
Finance Leases
Debt Instrument [Line Items]
Long-term debt, current maturities		2,700,000			2,700,000
Bank debt | Bank Revolving Loans
Debt Instrument [Line Items]
Long-term debt, current maturities		675,000,000			675,000,000
Bank debt | Other Foreign Bank Revolving and Term Loans
Debt Instrument [Line Items]
Long-term debt, current maturities		$ 41,000,000			$ 41,000,000
Four and Three Quarters Percent Senior Notes due 2025 [Member] | Senior Notes
Debt Instrument [Line Items]
Early repayment of senior debt	$ 300,000,000
Debt instrument, redemption price (in percentage)	100.00%
Loss on early extinguishment of debt			$ 1,500,000

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Financial Instruments - Carrying Amounts and Estimated Fair Values of Other Financial Instruments (Details) $ in Thousands	Jun. 30, 2022 USD ($)
Senior Notes | 3¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior note interest rate	3.25%
Senior Notes | 4⅛% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior note interest rate	4.125%
Senior Notes | 2¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior note interest rate	2.25%
Senior Notes | 1.4% Senior Secured Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior note interest rate	1.40%
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 247,843
Carrying Amount | Bank debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	1,736,364
Carrying Amount | Senior Notes | 3¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	679,510
Carrying Amount | Senior Notes | 4⅛% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	599,258
Carrying Amount | Senior Notes | 2¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	522,700
Carrying Amount | Senior Notes | 1.4% Senior Secured Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	499,797
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	247,843
Fair Value | Bank debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	1,736,364
Fair Value | Senior Notes | 3¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	643,496
Fair Value | Senior Notes | 4⅛% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	538,020
Fair Value | Senior Notes | 2¼% Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	412,828
Fair Value | Senior Notes | 1.4% Senior Secured Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Bank debt	$ 447,200

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Financial Instruments - Additional Information (Details)	3 Months Ended	6 Months Ended
	Jun. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)
USD Interest Rate Swap Contract One
Derivative [Line Items]
Derivative, notional amount	$ 50,000,000	$ 50,000,000
Fixed interest rate	2.878%	2.878%
USD Interest Rate Swap Contract Two
Derivative [Line Items]
Derivative, notional amount	$ 50,000,000	$ 50,000,000
Fixed interest rate	2.878%	2.878%
Accumulated Translation Adjustment
Derivative [Line Items]
Foreign currency (losses) gains of net investment hedges included in accumulated other comprehensive loss	$ 30,800,000	$ 42,000,000

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Commitments and Contingencies (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Settlement of investigation charge	$ 25.2	$ 25.2

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Retirement Benefits - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Pension Benefit Plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 3,270	$ 3,789	$ 6,570	$ 7,577
Interest cost	5,140	4,355	10,299	8,709
Expected return on plan assets	(17,315)	(19,850)	(34,629)	(39,698)
Amortization of prior service cost	53	58	108	116
Amortization of actuarial losses (gains)	1,157	3,028	2,312	6,054
Net periodic benefit credit	(7,695)	(8,620)	(15,340)	(17,242)
Other Postretirement Benefit Plans, Defined Benefit
Defined Benefit Plan Disclosure [Line Items]
Service cost	26	28	51	56
Interest cost	109	95	218	190
Amortization of prior service cost	(416)	(457)	(832)	(913)
Amortization of actuarial losses (gains)	(77)	(47)	(154)	(95)
Net periodic benefit credit	$ (358)	$ (381)	$ (717)	$ (762)

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Treasury Stock - Additional Information (Details) - USD ($)	6 Months Ended
	Jun. 30, 2022	Mar. 04, 2022
Equity, Class of Treasury Stock [Line Items]
Treasury stock (in shares)	64,896,981
2022 BOD Authorized Common Stock Repurchase
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, additional repurchase authorization		$ 300,000,000.0
Repurchase of common stock (in shares)	649,727
Average cost per share of treasury stock acquired (usd per share)	$ 40.56
Stock repurchase price	$ 26,400,000
Remaining authorized repurchase amount	$ 273,600,000
2004 Amended and Restated Stock Incentive Plan
Equity, Class of Treasury Stock [Line Items]
Average cost per share of treasury stock acquired (usd per share)	$ 41.92
Treasury shares issued for restricted stock units that vested during the period (in shares)	765,917
Average cost of treasury shares that were issued for restricted stock units that vested during the period (usd per share)	$ 3.19
Shares repurchased to satisfy minimum employee withholding tax requirements resulting from the vesting of such restricted stock units (in shares)	310,904

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Stock-Based Compensation - Additional Information (Details) - Restricted Stock Units $ in Millions	6 Months Ended
	Jun. 30, 2022 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (in shares) | shares	429,731
Fair value of restricted stock units granted | $	$ 17.9

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Segment Information - Reportable Business Segment Information (Details) - USD ($) $ in Thousands		3 Months Ended			6 Months Ended
		Jun. 30, 2022		Jun. 30, 2021	Jun. 30, 2022		Jun. 30, 2021
Segment Reporting Information [Line Items]
Net sales		$ 1,543,781		$ 1,348,661	$ 2,985,667		$ 2,586,771
Depreciation and amortization	[1]	66,388		60,104	133,996		119,655
Rationalization charges		3,428		354	4,807		10,711
Segment income		158,017	[2]	152,954	301,409	[2]	279,503
Amortization of debt issuance costs and discounts		1,300		1,400	2,800		2,700
Settlement of investigation charge		25,200			25,200
Dispensing and Specialty Closures
Segment Reporting Information [Line Items]
Net sales		602,431		545,768	1,200,358		1,055,120
Depreciation and amortization	[1]	36,541		29,101	73,160		57,991
Rationalization charges		0		67	0		5,298
Segment income		91,349	[2]	73,836	178,662	[2]	139,481
Metal Containers
Segment Reporting Information [Line Items]
Net sales		754,396		624,534	1,405,122		1,178,615
Depreciation and amortization	[1]	19,874		21,329	40,938		42,578
Rationalization charges		3,428		225	4,702		5,246
Segment income		66,358	[2]	58,635	104,367	[2]	104,249
Custom Containers
Segment Reporting Information [Line Items]
Net sales		186,954		178,359	380,187		353,036
Depreciation and amortization	[1]	9,934		9,632	19,817		19,005
Rationalization charges		0		62	105		167
Segment income		30,890	[2]	27,244	55,584	[2]	51,730
Corporate
Segment Reporting Information [Line Items]
Net sales		0		0	0		0
Depreciation and amortization	[1]	39		42	81		81
Rationalization charges		0		0	0		0
Segment income		$ (30,580)	[2]	$ (6,761)	$ (37,204)	[2]	$ (15,957)

[1] Depreciation and amortization excludes amortization of debt discount and debt issuance costs of $1.3 million and $1.4 million for the three months ended June 30, 2022 and 2021, respectively, and $2.8 million and $2.7 million for the six months ended June 30, 2022 and 2021, respectively.

[2] Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.

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Segment Information - Reconciliation of Segment Income to Income before Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2022		Jun. 30, 2021	Jun. 30, 2022		Jun. 30, 2021
Segment Reporting [Abstract]
Segment income	$ 158,017	[1]	$ 152,954	$ 301,409	[1]	$ 279,503
Interest and other debt expense	28,660		26,406	59,490		53,712
Income before income taxes	$ 129,357		$ 126,548	$ 241,919		$ 225,791

[1] Corporate includes a charge of $25.2 million for the settlement with the European Commission for each of the three and six months ended June 30, 2022.