BUSINESS SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2011

BUSINESS SEGMENT INFORMATION

NOTE 16. BUSINESS SEGMENT INFORMATION

We are engaged in the packaging industry and report our results in three business segments: metal containers, closures and plastic containers. The metal containers segment manufactures steel and aluminum containers for human and pet food and general line products. The closures segment manufactures an extensive range of metal, composite and plastic vacuum closures for food and beverage products and plastic closures for the dairy and juice markets. The plastic containers segment manufactures custom designed plastic containers, tubes and closures for personal care, health care, pharmaceutical, household and industrial chemical, food, pet care, agricultural chemical, automotive and marine chemical products. These segments are strategic business operations that are managed separately to maximize the production, technology and marketing of their packaging product. Our metal container business operates primarily in North America and Europe. Our closures business operates in North and South America, Europe and Asia. Our plastic container business operates primarily in North America. There are no inter-segment sales. Our metal containers segment includes the operations formerly designated as metal food containers and the VN operations acquired in March 2011. The accounting policies of the business segments are the same as those described in Note 1.

Information for each of the past three years for our business segments is as follows:

	Metal Containers		Closures		Plastic Containers		Corporate			Total
	(Dollars in thousands)
2011
Net sales	$	2,211,549	$	687,801	$	609,877	$	—		$	3,509,227
Depreciation and amortization		79,655		33,232		44,237		1,677			158,801
Rationalization charges		1,378		1,805		3,996		538			7,717
Segment income from operations (1) (2)		256,336		75,897		12,639		9,249			354,121
Segment assets		1,714,516		632,048		561,312		36,868			2,944,744
Capital expenditures		108,394		24,637		39,904		74			173,009
2010
Net sales	$	1,864,157	$	618,805	$	588,583	$	—		$	3,071,545
Depreciation and amortization		67,114		28,771		45,385		1,679			142,949
Rationalization charges		694		9,212		12,308		—			22,214
Segment income from operations (3) (4)		232,620		58,557		10,291		(18,149	)		283,319
Segment assets		931,244		627,006		537,978		39,940			2,136,168
Capital expenditures		47,836		15,769		41,707		83			105,395
2009
Net sales	$	1,916,239	$	609,056	$	541,464	$	—		$	3,066,759
Depreciation and amortization		69,141		28,334		46,107		1,683			145,265
Rationalization charges		—		1,341		150		—			1,491
Segment income from operations		206,378		74,078		31,276		(13,134	)		298,598
Segment assets		1,042,141		584,083		527,238		41,935			2,195,397
Capital expenditures		49,668		14,841		35,071		4			99,584

⁽¹⁾  Metal containers includes a charge for the resolution of a past product liability dispute of $3.3 million.

⁽²⁾  Corporate includes income of $25.2 million for proceeds received as a result of the termination of the merger agreement with Graham Packaging, net of costs associated with certain corporate development activities.

⁽³⁾ Closures includes a charge of $3.2 million for the remeasurement of net assets in Venezuela.

⁽⁴⁾ Corporate includes costs attributable to announced acquisitions of $2.7 million.

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

	2011		2010		2009
	(Dollars in thousands)
Total segment income from operations	$	354,121	$	283,319	$	298,598
Interest and other debt expense		63,954		61,639		50,999
Income before income taxes	$	290,167	$	221,680	$	247,599

Total segment assets at December 31 are reconciled to total assets as follows:

	2011		2010
	(Dollars in thousands)
Total segment assets	$	2,944,744	$	2,136,168
Other assets		34,343		39,850
Total assets	$	2,979,087	$	2,176,018

Financial information relating to our operations by geographic area is as follows:

	2011		2010		2009
	(Dollars in thousands)
Net sales:
United States	$	2,767,293	$	2,627,539	$	2,636,213
Foreign:
Europe		563,991		269,513		268,964
Canada		128,882		121,494		105,247
Other		49,061		52,999		56,335
Total net sales from foreign operations		741,934		444,006		430,546
Total net sales	$	3,509,227	$	3,071,545	$	3,066,759
Long-lived assets:
United States	$	689,705	$	681,862
Foreign:
Europe		301,001		103,168
Canada		42,021		48,157
Other		31,981		16,533
Total long-lived assets at foreign operations		375,003		167,858
Total long-lived assets	$	1,064,708	$	849,720

Net sales are attributed to the country from which the product was manufactured and shipped.

Sales of our metal containers segment to Nestlé Food Company accounted for 10.6 percent, 10.4 percent and 10.0 percent of our consolidated net sales in 2011, 2010 and 2009, respectively.

Sales and income from operations of our metal container business and part of our closures business 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 income from operations during that quarter (see Note 17).