Business Segment Information

9 Months Ended

Sep. 30, 2011

Business Segment Information

Note 13. Business Segment Information

Reportable business segment information for the three and nine months ended September 30 is as follows:

	Metal				Plastic
	Containers(1)		Closures		Containers		Corporate			Total
	(Dollars in thousands)
Three Months Ended September 30, 2011
Net sales	$	798,663	$	189,554	$	159,791	$	-		$	1,148,008
Depreciation and amortization(2)		20,498		8,353		11,269		417			40,537
Rationalization charges		-		339		343		-			682
Segment income from operations		111,745		24,369		3,802		(3,865	)		136,051
Three Months Ended September 30, 2010
Net sales	$	688,901	$	162,769	$	150,386	$	-		$	1,002,056
Depreciation and amortization(2)		16,697		7,055		11,408		420			35,580
Rationalization charges		381		-		590		-			971
Segment income from operations(3)		95,274		22,028		8,206		(4,554	)		120,954
Nine Months Ended September 30, 2011
Net sales	$	1,671,404	$	534,133	$	467,781	$	-		$	2,673,318
Depreciation and amortization(2)		58,481		25,074		33,576		1,264			118,395
Rationalization charges		1,378		1,731		1,673		-			4,782
Segment income from operations(4) (5)		192,984		62,866		14,629		13,677			284,156
Nine Months Ended September 30, 2010
Net sales	$	1,442,015	$	472,588	$	445,337	$	-		$	2,359,940
Depreciation and amortization(2)		50,299		21,114		34,146		1,259			106,818
Rationalization charges		694		-		3,039		-			3,733
Segment income from operations(3) (6)		185,698		57,078		15,080		(13,138	)		244,718

(1)   Our metal containers segment includes the operations formerly categorized as metal food containers and the VN operations acquired in March 2011.

(2)   Depreciation and amortization excludes amortization of debt discount and issuance costs of $0.9 million and $0.8 million for the three months ended September 30, 2011 and 2010, respectively, and $2.5 million and $2.1 million for the nine months ended September 30, 2011 and 2010, respectively.

(3)   Income from operations for corporate includes costs attributable to announced acquisitions of $0.5 million for the three and nine months ended September 30, 2010.

(4)   Income from operations for corporate includes income of $25.2 million for proceeds received as a result of the termination of the Graham Packaging merger agreement, net of costs associated with certain corporate development activities.

(5)   Income from operations of the metal containers segment includes a charge for the resolution of a past product liability dispute of $3.3 million.

(6)   Income from operations for the closures segment includes a charge of $3.2 million for the remeasurement of net assets in the Venezuela operations to the devalued official Bolivar exchange rate.

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

	Three Months Ended				Nine Months Ended
	Sept. 30,		Sept. 30,		Sept. 30,		Sept. 30,
	2011		2010		2011		2010
	(Dollars in thousands)
Total segment income from operations	$	136,051	$	120,954	$	284,156	$	244,718
Interest and other debt expense		17,268		20,477		47,654		44,983
Income before income taxes	$	118,783	$	100,477	$	236,502	$	199,735

Sales and income from operations of our metal container business are dependent, in part, upon the vegetable and fruit harvests in the midwest and western regions of the United States and, to a lesser degree, various geographies in Central and Eastern Europe.  Our closures business is also dependent, in part, upon vegetable and fruit harvests.  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 income from operations during that quarter.