UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004

FORM 10-Q

[X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2006

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 1-11846

AptarGroup, Inc.

DELAWARE
(State of Incorporation) 36-3853103
(I.R.S. Employer Identification No.)

475 WEST TERRA COTTA AVENUE, SUITE E, CRYSTAL LAKE, ILLINOIS 60014

815-477-0424

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 þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Act. (Check one):

Large accelerated filer þ                      Accelerated filer o                      Non-accelerated filer o

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date (May 1, 2006).

Common Stock 35,137,041

AptarGroup, Inc.

Form 10-Q

Quarter Ended March 31, 2006

INDEX

Part I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Income — Three Months Ended March 31, 2006 and 2005	1
	Condensed Consolidated Balance Sheets — March 31, 2006 and December 31, 2005	2
	Condensed Consolidated Statements of Cash Flows — Three Months Ended March 31, 2006 and 2005	4
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	18
Item 4.	Controls and Procedures	18
Part II.	OTHER INFORMATION
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 6.	Exhibits	19
	Signature	20
Summary of Bonus Arrangements for Executive Officers
Certification
Certification
Certification
Certification

 i 

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

In thousands, except per share amounts

Three Months Ended March 31,	2006			2005
Net Sales	$	375,468		$	343,999
Operating Expenses:
Cost of sales (exclusive of depreciation shown below)		253,786			232,478
Selling, research & development and administrative		62,370			51,640
Depreciation and amortization		26,913			25,532
		343,069			309,650
Operating Income		32,399			34,349
Other Income (Expense):
Interest expense		(3,810	)		(2,738	)
Interest income		911			815
Equity in results of affiliates		106			332
Minority interests		(46	)		—
Miscellaneous, net		(513	)		(305	)
		(3,352	)		(1,896	)
Income Before Income Taxes		29,047			32,453
Provision for Income Taxes		9,237			10,385
Net Income	$	19,810		$	22,068
Net Income Per Common Share:
Basic	$	.56		$	.62
Diluted	$	.55		$	.60
Average Number of Shares Outstanding:
Basic		35,075			35,639
Diluted		36,246			36,773
Dividends Per Common Share	$	.20		$	.15

See accompanying notes to consolidated financial statements.

1

AptarGroup, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

In thousands, except per share amounts

	March 31,			December 31,
	2006			2005
Assets
Current Assets:
Cash and equivalents	$	120,210		$	117,635
Accounts and notes receivable, less allowance for doubtful accounts of $10,713 in 2006 and $10,356 in 2005		289,319			260,175
Inventories, net		193,245			184,241
Prepaid expenses and other current assets		49,671			43,240
		652,445			605,291
Property, Plant and Equipment:
Buildings and improvements		209,711			201,194
Machinery and equipment		1,096,069			1,058,684
		1,305,780			1,259,878
Less: Accumulated depreciation		(763,503	)		(735,659	)
		542,277			524,219
Land		12,854			12,601
		555,131			536,820
Other Assets:
Investments in affiliates		5,196			5,050
Goodwill		196,419			184,763
Intangible assets, net		17,437			16,927
Other non-current assets		6,436			8,468
		225,488			215,208
Total Assets	$	1,433,064		$	1,357,319

See accompanying notes to consolidated financial statements.

2

AptarGroup, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

In thousands, except per share amounts

	March 31,			December 31,
	2006			2005
Liabilities and Stockholders’ Equity
Current Liabilities:
Notes payable	$	118,598		$	97,650
Current maturities of long-term obligations		5,553			4,453
Accounts payable and accrued liabilities		231,988			218,659
		356,139			320,762
Long-Term Obligations		141,580			144,541
Deferred Liabilities and Other:
Deferred income taxes		44,333			45,056
Retirement and deferred compensation plans		33,732			31,023
Deferred and other non-current liabilities		1,648			1,849
Commitments and contingencies		—			—
Minority interests		4,833			4,700
		84,546			82,628
Stockholders’ Equity:
Preferred stock, $.01 par value, 1 million shares authorized, none outstanding		—			—
Common stock, $.01 par value		389			386
Capital in excess of par value		177,686			162,863
Retained earnings		784,113			771,304
Accumulated other comprehensive income		41,879			24,289
Less treasury stock at cost, 3.7 million shares as of March 31, 2006 and December 31, 2005		(153,268	)		(149,454	)
		850,799			809,388
Total Liabilities and Stockholders’ Equity	$	1,433,064		$	1,357,319

See accompanying notes to consolidated financial statements.

3

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

In thousands, brackets denote cash outflows

Three Months Ended March 31,	2006			2005
Cash Flows From Operating Activities:
Net income	$	19,810		$	22,068
Adjustments to reconcile net income to net cash provided by operations:
Depreciation		26,122			24,923
Amortization		791			609
Stock option based compensation		7,137			—
Provision for bad debts		442			104
Labor redeployment		(473	)		—
Minority interests		46			—
Deferred income taxes		(2,556	)		(607	)
Retirement and deferred compensation plans		(496	)		(1,753	)
Equity in results of affiliates in excess of cash distributions received		(57	)		(304	)
Changes in balance sheet items, excluding effects from foreign currency adjustments:
Accounts receivable		(19,852	)		(19,931	)
Inventories		(4,204	)		(9,029	)
Prepaid and other current assets		(2,801	)		(1,685	)
Accounts payable and accrued liabilities		9,215			10,424
Income taxes payable		260			1,460
Other changes, net		(1,838	)		5,562
Net Cash Provided by Operations		31,546			31,841
Cash Flows From Investing Activities:
Capital expenditures		(25,535	)		(25,010	)
Disposition of property and equipment		131			703
Intangible assets acquired		(994	)		(257	)
Acquisition of business		(21,315	)		(29,774	)
Collection of notes receivable, net		126			197
Net Cash Used by Investing Activities		(47,587	)		(54,141	)
Cash Flows From Financing Activities:
Proceeds from notes payable		20,617			17,374
Proceeds from long-term obligations		2,680			628
Repayments of long-term obligations		(4,658	)		(934	)
Dividends paid		(7,001	)		(5,353	)
Proceeds from stock options exercises		8,160			3,888
Purchase of treasury stock		(4,611	)		(12,296	)
Excess tax benefit from exercise of stock options		978			—
Net Cash Provided by Financing Activities		16,165			3,307
Effect of Exchange Rate Changes on Cash		2,451			(6,514	)
Net Increase/(Decrease) in Cash and Equivalents		2,575			(25,507	)
Cash and Equivalents at Beginning of Period		117,635			170,368
Cash and Equivalents at End of Period	$	120,210		$	144,861
Supplemental Non-cash Financing Activities:
Capital lease obligations	$	—			100

See accompanying notes to consolidated financial statements.

4

AptarGroup, Inc.

Notes to Condensed Consolidated Financial Statements

(Amounts in Thousands, Except per Share Amounts, or Otherwise Indicated)
(Unaudited)

NOTE 1 — BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements include the accounts of AptarGroup, Inc. and its subsidiaries. The terms “AptarGroup” or “Company” as used herein refer to AptarGroup, Inc. and its subsidiaries.

          In the opinion of management, the unaudited consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of consolidated financial position, results of operations, and cash flows for the interim periods presented. The accompanying unaudited consolidated financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures made are adequate to make the information presented not misleading. Accordingly, these unaudited consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

          Effective January 1, 2006, the Company adopted Statement of Financial Accounting Standards (“SFAS”) 123(R), “Share-Based Payment”. This statement replaces SFAS 123, “Accounting for Stock-Based Compensation” and supersedes Accounting Principles Board Opinion (“APB”) 25. SFAS 123(R) requires that all share-based compensation be recognized as an expense in the financial statements and that such cost be measured at the fair value of the award. Also under the new standard, excess tax benefits related to issuance of equity instruments under share-based payment arrangements are considered financing instead of operating cash flow activities. The Company has adopted the modified prospective method of applying SFAS 123(R), which requires the recognition of compensation expense on a prospective basis. Accordingly, prior period financial statements have not been restated.

NOTE 2 — INVENTORIES

At March 31, 2006 and December 31, 2005, approximately 22% and 23%, respectively, of the total inventories are accounted for by using the LIFO method. Inventories, by component, consisted of:

	March 31,			December 31,
	2006			2005
Raw materials	$	65,332		$	65,644
Work-in-process		44,218			41,032
Finished goods		87,335			81,105
Total		196,885			187,781
Less LIFO Reserve		(3,640	)		(3,540	)
Total	$	193,245		$	184,241

5

NOTE 3 — GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill since the year ended December 31, 2005 are as follows by reporting segment:

	Pharma		Beauty & Home		Closures		Total
Balance as of December 31, 2005	$	22,464	$	145,749	$	16,550	$	184,763
Acquisitions (See Note 11)		—		—		9,473		9,473
Foreign currency exchange effects		488		1,411		284		2,183
Balance as of March 31, 2006	$	22,952	$	147,160	$	26,307	$	196,419

The table below shows a summary of intangible assets as of March 31, 2006 and December 31, 2005.

		March 31, 2006								December 31, 2005
Weighted Average		Gross								Gross
Amortization		Carrying		Accumulated			Net			Carrying		Accumulated			Net
Period (Years)		Amount		Amortization				Value		Amount		Amortization			Value
Amortized intangible assets:
Patents	15	$	16,143	$	(7,940	)		$	8,203	$	15,079	$	(7,471	)	$	7,608
License agreements and other	6		15,435		(6,730	)			8,705		14,971		(6,171	)		8,800
	11		31,578		(14,670	)			16,908		30,050		(13,642	)		16,408
Unamortized intangible assets:
Minimum pension liability			529		—				529		519		—			519
			529		—				529		519		—			519
Total intangible assets		$	32,107	$	(14,670	)		$	17,437	$	30,569	$	(13,642	)	$	16,927

          Aggregate amortization expense for the intangible assets above for the quarters ended March 31, 2006 and 2005 was $791 and $609, respectively.

          Estimated amortization expense for the years ending December 31 is as follows:

2006	$	3,069
2007		3,046
2008		2,861
2009		2,339
2010		1,796

          Future amortization expense may fluctuate depending on changes in foreign currency rates. The estimates for amortization expense noted above are based upon foreign exchange rates as of March 31, 2006.

NOTE 4 — COMPREHENSIVE INCOME/(LOSS)

AptarGroup’s total comprehensive income/(loss) was as follows:

Three Months Ended March 31,	2006			2005
Net income	$	19,810		$	22,068
Add: Foreign currency translation adjustments		17,609			(33,838	)
Minimum pension liability adjustment (net of tax)		(19	)		—
Total comprehensive income/(loss)	$	37,400		$	(11,770	)

6

NOTE 5 — RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of Net Periodic Benefit Cost:

	Domestic Plans						Foreign Plans
Three months ended March 31,	2006			2005			2006			2005
Service cost	$	987		$	993		$	330		$	260
Interest cost		661			628			334			347
Expected return on plan assets		(604	)		(604	)		(139	)		(117	)
Amortization of prior service cost		1			1			18			26
Amortization of net loss		151			126			144			73
Net periodic benefit cost	$	1,196		$	1,144		$	687		$	589

EMPLOYER CONTRIBUTIONS

The Company previously disclosed in its financial statements for the year ended December 31, 2005, that it expected to contribute approximately $2 million to its domestic defined benefit plans and approximately $1.6 million to its foreign defined benefit plans in 2006. As of March 31, 2006, the Company has contributed approximately $.2 million to its foreign plans and has not yet contributed to its domestic plans. The Company presently anticipates contributing an additional $1.4 million to fund its foreign plans and anticipates contributing approximately $2 million to its domestic plans for the remainder of 2006.

NOTE 6 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company maintains a foreign exchange risk management policy designed to establish a framework to protect the value of the Company’s non-functional denominated transactions from adverse changes in exchange rates. Sales of the Company’s products can be denominated in a currency different from the currency in which the related costs to produce the product are denominated. Changes in exchange rates on such inter-country sales impact the Company’s results of operations. The Company’s policy is not to engage in speculative foreign currency hedging activities, but to minimize its net foreign currency transaction exposure defined as firm commitments and transactions recorded and denominated in currencies other than the functional currency. The Company may use foreign currency forward exchange contracts, options and cross currency swaps to hedge these risks.

          The Company maintains an interest rate risk management strategy to minimize significant, unanticipated earnings fluctuations that may arise from volatility in interest rates.

          For derivative instruments designated as hedges, the Company formally documents the nature and relationships between the hedging instruments and the hedged items, as well as the risk management objectives, strategies for undertaking the various hedge transactions, and the method of assessing hedge effectiveness. Additionally, in order to designate any derivative instrument as a hedge of an anticipated transaction, the significant characteristics and expected terms of any anticipated transaction must be specifically identified, and it must be probable that the anticipated transaction will occur.

FAIR VALUE HEDGES

The Company has an interest rate swap to convert a portion of its fixed-rate debt into variable-rate debt. Under the interest rate swap contract, the Company exchanges, at specified intervals, the difference between fixed-rate and floating-rate amounts, which are calculated based on an agreed upon notional amount.

          As of March 31, 2006, the Company has recorded the fair value of derivative instruments of $1.2 million in other non-current assets with a corresponding increase to debt related to a fixed-to-variable interest rate swap agreement with a notional principal value of $25 million. No gain or loss was recorded in the income statement in 2006 or 2005 since there was no hedge ineffectiveness.

CASH FLOW HEDGES

The Company did not use any cash flow hedges for the quarters ended March 31, 2006 or 2005.

HEDGE OF NET INVESTMENTS IN FOREIGN OPERATIONS

A significant number of the Company’s operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of the Company’s foreign entities. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on the Company’s financial condition and results of operations. Conversely, a weakening U.S. dollar has an additive effect. The Company in some cases maintains debt in these subsidiaries to offset the net asset exposure. The Company does not otherwise actively manage this risk using derivative financial instruments. In the event the Company plans on a full or partial liquidation of any of its foreign subsidiaries where the Company’s net investment is likely to be monetized, the Company will consider hedging the currency exposure associated with such a transaction.

OTHER

As of March 31, 2006, the Company has recorded the fair value of foreign currency forward exchange contracts of $29 thousand in accounts payable and accrued liabilities in the balance sheet. All forward exchange contracts outstanding as of March 31, 2006 had an aggregate contract amount of $65.2 million.

7

NOTE 7 — COMMITMENTS AND CONTINGENCIES

The Company, in the normal course of business, is subject to a number of lawsuits and claims both actual and potential in nature. Management believes the resolution of these claims and lawsuits will not have a material adverse or positive effect on the Company’s financial position, results of operations or cash flow.

          The Company has received a ruling in its favor in a patent litigation case in Europe for which it is a plaintiff. The defendant has appealed and no judgment amount has officially been awarded. The Company has not recorded a gain contingency, as the amount of the judgment is unknown and difficult to estimate.

          Under its Certificate of Incorporation, the Company has agreed to indemnify its officers and directors for certain events or occurrences while the officer or director is, or was serving, at its request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a directors and officers liability insurance policy that covers a portion of its exposure. As a result of its insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of March 31, 2006.

NOTE 8 — STOCK REPURCHASE PROGRAM

During the quarter ended March 31, 2006, the Company repurchased 85.7 thousand shares for an aggregate amount of $4.6 million. As of March 31, 2006, the Company has outstanding authorizations to repurchase up to approximately 1.0 million shares. The timing of and total amount expended for the share repurchase depends upon market conditions.

NOTE 9 — EARNINGS PER SHARE

AptarGroup’s authorized common stock consisted of 99 million shares, having a par value of $.01 each. Information related to the calculation of earnings per share is as follows:

	Three months ended
	March 31, 2006				March 31, 2005
	Diluted		Basic		Diluted		Basic
Consolidated operations
Income available to common shareholders	$	19,810	$	19,810	$	22,068	$	22,068
Average equivalent shares
Shares of common stock		35,075		35,075		35,639		35,639
Effect of dilutive stock based compensation Stock options		1,168		—		1,129		—
Restricted stock		3		—		5		—
Total average equivalent shares		36,246		35,075		36,773		35,639
Net income per share	$	.55	$	.56	$	.60	$	.62

NOTE 10 — SEGMENT INFORMATION

Beginning with the first quarter of 2006, The Company is reporting new business segments that reflect AptarGroup’s realigned internal financial reporting structure. Prior period information has been conformed to the current presentation.

          The Company operates in the packaging components industry, which includes the development, manufacture and sale of consumer product dispensing systems. The Company is organized into three reporting segments. Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment. Operations that sell dispensing systems to the pharmaceutical market form the Pharma segment. Operations that sell closures to each market served by AptarGroup form the Closures segment.

          The accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005. The Company evaluates performance of its business segments and allocates resources based upon earnings before interest expense in excess of interest income, stock option and corporate expenses, income taxes and unusual items (collectively referred to as “Segment Income”).

8

Financial information regarding the Company’s reportable segments is shown below:

Three months ended March 31,	2006			2005
Total Revenue:
Beauty & Home	$	197,922		$	180,942
Closures		105,729			95,153
Pharma		74,957			70,714
Other		226			329
Total Revenue		378,834			347,138
Less: Intersegment Sales:
Beauty & Home	$	2,614		$	1,835
Closures		241			408
Pharma		343			632
Other		168			264
Total Intersegment Sales	$	3,366		$	3,139
Net Sales:
Beauty & Home	$	195,308		$	179,107
Closures		105,488			94,745
Pharma		74,614			70,082
Other		58			65
Net Sales	$	375,468		$	343,999
Segment Income:
Beauty & Home	$	16,633		$	14,896
Closures		10,537			8,262
Pharma		17,063			16,264
Corporate & Other (1)		(12,287	)		(5,046	)
Income before interest and taxes	$	31,946		$	34,376
Interest expense, net		(2,899	)		(1,923	)
Income before income taxes	$	29,047		$	32,453
Depreciation and Amortization:
Beauty & Home	$	15,986		$	14,050
Closures		5,976			5,936
Pharma		4,463			5,055
Other		488			491
Depreciation and Amortization	$	26,913		$	25,532
Capital Expenditures:
Beauty & Home	$	13,424		$	14,218
Closures		9,586			5,095
Pharma		2,301			5,602
Other		224			95
Capital Expenditures	$	25,535		$	25,010
	March 31,			December 31,
	2006			2005
Total Assets:
Beauty & Home	$	830,027		$	790,147
Closures		289,048			259,104
Pharma		220,863			221,667
Other		93,126			86,401
Total Assets	$	1,433,064		$	1,357,319

(1) Corporate & Other amount for 2006 includes $7.1 million relating to stock option expense.

NOTE 11 — ACQUISITIONS

During the first quarter of 2006, the Company acquired the net assets of CCL Dispensing Systems, LLC (“CCLDS”) for approximately $21.3 million in cash. No debt was assumed in the transaction. CCLDS is located in Libertyville, Illinois and produces primarily dispensing closures. The excess of the purchase price over the fair values of assets acquired and liabilities assumed was allocated to Goodwill. Preliminary goodwill of approximately $9.5 million was recorded on the acquisition and is deductible for tax purposes. The condensed consolidated statement of income includes CCLDS’ results of operations from February 6, 2006, the date of the acquisition.

9

NOTE 12 — STOCK-BASED COMPENSATION

Effective January 1, 2006, the Company adopted Statement of Financial Accounting Standards (“SFAS”) 123(R), “Share-Based Payment”. This statement replaces SFAS 123, “Accounting for Stock-Based Compensation” and supersedes Accounting Principles Board Opinion (“APB”) 25. SFAS 123(R) requires that all share-based compensation be recognized as an expense in the financial statements and that such cost be measured at the fair value of the award. Also under the new standard, excess tax benefits related to issuance of equity instruments under share-based payment arrangements are considered financing instead of operating cash flow activities. The Company has adopted the modified prospective method of applying SFAS 123(R), which requires the recognition of compensation expense on a prospective basis. Accordingly, prior period financial statements have not been restated.

          Prior to the adoption of SFAS 123(R), the Company applied APB 25 to account for stock-based awards. Under APB 25, the Company only recorded stock-based compensation expense for restricted stock unit grants, which amounted to $.1 million in the first quarter of 2005 compared to $.2 million in the first quarter of 2006. Under APB 25, the Company was not required to recognize compensation expense for stock options. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS 123 to stock option based compensation in the prior year.

Three Months Ended March 31,	2005
Net income, as reported	$	22,068
Deduct: Total stock option based compensation expense           determined under fair value method for all awards, net of related tax effects		(1,276	)
Pro forma net income	$	20,792
Earnings per share:
Basic — as reported	$	.62
Basic — pro forma	$	.58
Diluted — as reported	$	.60
Diluted — pro forma	$	.57

          SFAS 123(R) upon adoption requires the application of the non-substantive vesting approach which means that an award is fully vested when the employee’s retention of the award is no longer contingent on providing subsequent service. Under this approach, compensation costs are recognized over the requisite service period of the award instead of ratably over the vesting period stated in the grant. As such, costs would be recognized immediately, if the employee is retirement eligible on the date of grant or over the period from the date of grant until retirement eligibility if retirement eligibility is reached before the end of the vesting period stated in the grant. For awards granted prior to adoption, the Company will continue to recognize compensation costs ratably over the vesting period with accelerated recognition of the unvested portion upon actual retirement. Had we been using the non-substantive approach during the three months ended March 31, 2005, net income would have decreased by approximately $2.5 million ($.07 per share).

          The Company issues stock options and restricted stock units to employees under Stock Awards Plans approved by shareholders. Stock options are issued to non-employee directors for their services as directors under Director Stock Option Plans approved by shareholders. Options are awarded with the exercise price equal to the market price on the date of grant and generally become exercisable over three years and expire 10 years after grant. Restricted stock generally vests over three years.

          Compensation expense recorded attributable to stock options for the first quarter of 2006 was approximately $7.1 million ($4.6 million after tax), or $0.13 per share (basic and diluted). The income tax benefit related to this compensation expense was approximately $2.5 million. Approximately $6.8 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales.

          The Company uses historical data to estimate expected life and volatility. The weighted-average fair value of stock options granted under the Stock Awards Plans was $16.09 and $15.47 per share in 2006 and 2005, respectively. These values were estimated on the respective dates of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Stock Awards Plans:
Three months ended March 31,	2006		2005
Dividend Yield		1.6%		1.4%
Expected Stock Price Volatility		24.8%		27.2%
Risk-free Interest Rate		4.3%		4.0%
Expected Life of Option (years)		7.0		7.0

There have been no grants under the Director Stock Option Plan during the first quarter of 2006.

10

A summary of option activity under the Company’s stock option plans as of March 31, 2006, and changes during the period then ended is presented below:

	Stock Awards Plans					Director Stock Option Plans
				Weighted Average				Weighted Average
	Shares			Exercise Price		Shares		Exercise Price
Outstanding, January 1, 2006		3,708,406		$	32.73		117,000	$	40.40
Granted		609,000			54.02		—		—
Exercised		(265,564	)		24.40		—		—
Forfeited or expired		(4,401	)		29.40		—		—
Outstanding at March 31, 2006		4,047,441		$	36.48		117,000	$	40.40
Exercisable at March 31, 2006		2,638,308		$	30.05		75,000	$	34.28
Weighted-Average Remaining Contractual Term (Years):
Outstanding at March 31, 2006		6.6					6.3
Exercisable at March 31, 2006		5.3					4.8

Aggregate Intrinsic Value ($000):
Outstanding at March 31, 2006	$	75,963	$	1,737
Exercisable at March 31, 2006	$	66,475	$	1,572
Intrinsic Value of Options Exercised ($000) During the Three Months Ended:
March 31, 2006	$	8,005	$	—
March 31, 2005	$	3,307	$	118

          The fair value of shares vested during the three months ended March 31, 2006 and 2005 was $5.2 million and $4.2 million, respectively. Cash received from option exercises was approximately $8.2 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $1.3 million in the three months ended March 31, 2006. As of March 31, 2006, the remaining valuation of stock option awards to be expensed in future periods was $13.8 million and the related weighted-average period over which it is expected to be recognized is 1.5 years.

     The fair value of restricted stock grants is the market price of the underlying shares on the grant date. A summary of restricted stock unit activity as of March 31, 2006, and changes during the period then ended is presented below:

				Weighted-Average
	Shares			Grant-Date Fair Value
Nonvested at January 1, 2006		18,015		$	34.59
Granted		3,363			55.02
Vested		(13,194	)		31.01
Nonvested at March 31, 2006		8,184		$	48.75

     The fair value of units vested during the three months ended March 31, 2006 and 2005 was $409 and $357, respectively. The intrinsic value of units vested during the three months ended March 31, 2006 and 2005 was $749 and $791, respectively. As of March 31, 2006, there was $243 of total unrecognized compensation cost relating to restricted stock unit awards which is expected to be recognized over a weighted average period of 1.2 years.

NOTE 13 — REDEPLOYMENT PROGRAM

The Company announced in the third quarter of 2005 a three year plan to reduce and redeploy certain personnel in its French fragrance/cosmetic operations. The objective of this three year plan is to better align production equipment and personnel between several sites in France to ultimately reduce costs and maintain competitiveness. This plan will be implemented in phases over a three year period and is expected to be completed in the fourth quarter of 2008. The plan anticipates a headcount reduction by the end of 2008 of approximately 90 people. Total costs associated with the Redeployment Program are expected to be approximately $7 to $9 million before taxes over the three year period and primarily relate to employee severance costs. Approximately $900 thousand of such charges before tax and $600 thousand after-tax or approximately $.02 per diluted share were recorded in the first quarter of 2006. The following table below highlights the pre-tax amount incurred in the period and the ending liability at the end of March 31, 2006. All charges related to the Redeployment Program are included in Cost of Sales in the condensed consolidated statement of income.

			Charges For
	Beginning Reserve		The Three Months							Ending Reserve
	At 01/01/06		Ended 03/31/06		Cash Paid			FX Impact		At 03/31/06
Employee severance	$	2,323	$	680	$	(1,213	)	$	60	$	1,850
Other costs		—		229		(230	)		1		—
Totals	$	2,323	$	909	$	(1,443	)	$	61	$	1,850

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ITEM 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS, OR OTHERWISE INDICATED)

RESULTS OF OPERATIONS

Quarter Ended March 31,	2006			2005
Net Sales		100.0%			100.0%
Cost of sales (exclusive of depreciation shown below)		67.6			67.6
Selling, research & development and administration		16.6			15.0
Depreciation and amortization		7.2			7.4
Operating Income		8.6			10.0
Other income (expense)		(.9	)		(.6	)
Income before income taxes		7.7			9.4
Net income		5.3%			6.4%
Effective Tax Rate		31.8%			32.0%

NET SALES

We recorded record net sales of $375.5 million for the quarter ended March 31, 2006, or 9% above first quarter 2005 net sales of $344.0 million. The U.S. dollar was stronger in the first quarter of 2006 versus the Euro compared to the same period a year ago. As a result, the stronger U.S. dollar negatively impacted the translation of our foreign denominated sales into U.S. dollars and reduced net sales by approximately 5%. Acquisitions made in 2005 and the first quarter of 2006, accounted for approximately $25.6 million of the $31.5 million increase in sales. Custom tooling sales increased by approximately $7.3 million in the first quarter of 2006 compared to the same period in 2005. Price increases, primarily related to material cost increases passed along to customers had a positive effect on net sales in the quarter. The changes in sales by reporting segment were as follows:

• Sales of our products to the Beauty and Home segment increased a reported 9% in the first quarter 2006 compared to the same period a year ago. Changes in foreign currency rates negatively impacted sales by approximately 5%. Acquisitions accounted for 13% of the sales growth. Excluding the effects of foreign currency and acquisitions, sales increased 1% over the same period in the prior year.

• Sales of our products to the Pharma segment increased a reported 6% in the first quarter 2006 compared to the same period a year ago. Changes in foreign currency rates negatively impacted sales by approximately 8% in the quarter.

• Sales of our products to the Closures segment increased a reported 11% in the first quarter 2006 compared to the same period a year ago. Changes in foreign currency rates negatively impacted sales by approximately 3% in the first quarter 2006, while acquisitions accounted for 3% of the sales growth in the quarter. Excluding the effects of foreign currency and acquisitions, sales increased 11% over the same period in the prior year.

The following table sets forth, for the periods indicated, net sales by geographic location:

Quarter Ended March 31,	2006		% of Total		2005		% of Total
Domestic	$	112,343		30%	$	102,166		30%
Europe		229,479		61%		210,192		61%
Other Foreign		33,646		9%		31,641		9%

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COST OF SALES (EXCLUSIVE OF DEPRECIATION SHOWN BELOW)

Our cost of sales as a percent of net sales remained constant at 67.6 % in the first quarter of 2006 compared to the same period a year ago. Our cost of sales percentage was negatively influenced by the following factors in 2006:

Rising Raw Material Costs. Raw material costs, in particular plastic resin costs in the U.S., continued to increase in the first quarter of 2006 over 2005. While the majority of this raw material price increase has been passed on to customers in the form of selling price increases, the net effect is a reduction in the margin percentage.

Stock Option Expenses. Stock option expense of approximately $300 thousand was recorded beginning in the first quarter of 2006 due to the adoption of SFAS 123R.

Partially offsetting these negative factors were the following positive factors in 2006:

Strengthening of the U.S. Dollar. We are a net importer from Europe into the U.S. of products produced in Europe with costs denominated in Euros. As a result, when the U.S. dollar or other currencies strengthen against the Euro, products produced in Europe (with costs denominated in Euros) and sold in currencies that are stronger compared to the Euro, have a positive impact on cost of sales as a percentage of net sales.

SELLING, RESEARCH & DEVELOPMENT AND ADMINISTRATIVE

Our Selling, Research & Development and Administrative expenses (“SG&A”) increased by approximately $10.7 million in the first quarter of 2006 compared to the same period a year ago. Approximately $6.8 million of the increase relates to the expensing of stock options beginning in the first quarter of 2006 due to the adoption of SFAS 123R. Acquisitions accounted for approximately $3.0 million of the increase in SG&A in the quarter. Changes in currency rates had a positive impact of approximately $2.7 million in the quarter. SG&A as a percentage of net sales increased to 16.6% compared to 15.0% of net sales in the same period of the prior year primarily due to the expensing of stock options.

DEPRECIATION AND AMORTIZATION

Depreciation and amortization increased approximately $1.4 million in the first quarter of 2006 to $26.9 million compared to $25.5 million in the first quarter of 2005. Changes in foreign currency rates positively impacted (less expense) depreciation and amortization by approximately $1.3 million. Acquisitions added approximately $3.0 million of additional depreciation and amortization expense in the quarter.

OPERATING INCOME

Operating income decreased approximately $2.0 million in the first quarter of 2006 to $32.4 million compared to $34.3 million in the same period in the prior year. The decrease is primarily due to $7.1 million (approximately 1.9% of sales) in stock option expense recorded in the quarter mostly offset by the increase in sales mentioned above. Operating income as percentage of net sales decreased to 8.6% in the first quarter 2006 compared to 10.0% for the same period in the prior year.

NET OTHER EXPENSE

Net other expenses in the first quarter of 2006 increased to $3.4 million from $1.9 million in the same period in the prior year primarily reflecting increased interest expense of $1.1 million. The increase in interest expense is due primarily to higher average interest rates and higher borrowing levels.

EFFECTIVE TAX RATE

The reported effective tax rate decreased slightly to 31.8% for the three months ended March 31, 2006 compared to 32.0% in the first quarter of 2005 due primarily to the expense of stock options in the U.S. as the U.S. effective rate is higher than our effective worldwide rate.

NET INCOME

We reported net income of $19.8 million in the first quarter of 2006 compared to $22.1 million in the first quarter of 2005.

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BEAUTY & HOME SEGMENT

Beginning with the first quarter of 2006, we are reporting new business segments that reflect our realigned internal financial reporting structure. Prior period information has been conformed to the current presentation.

     Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment.

Three Months Ended March 31,	2006		2005
Net Sales	$	195,308	$	179,107
Segment Income (1)		16,633		14,896
Segment Income as a percentage of Net Sales		8.5%		8.3%

(1) Segment Income is defined as earnings before net interest, stock option and corporate expenses, income taxes and unusual items. The Company evaluates performance of its business units and allocates resources based upon Segment Income. For a reconciliation of Segment Income to income before income taxes, see Note 10 — Segment information to the Consolidated Financial Statements in Item 1.

          Net sales for the quarter ended March 31, 2006 increased 9% in the first quarter of 2006 to $195.3 million compared to $179.1 million in the first quarter of the prior year. The strengthening U.S. dollar compared to the Euro negatively impacted the sales increase. Net sales excluding changes in foreign currency exchange rates increased approximately 14% from the prior year. Acquisitions accounted for approximately $22.6 million or 13% of the sales increase. Sales excluding foreign currency changes and acquisitions to the personal care market increased approximately 5% in the first quarter of 2006 compared to the same period in the prior year, while sales to the fragrance/cosmetic market were flat and sales to the household market decreased approximately 6%.

          Segment Income in the first quarter of 2006 increased approximately 11.7% to $16.6 million compared to $14.9 million reported in the same period in the prior year. Acquisitions accounted for approximately $2.1 million of segment income in the quarter. This positive impact was offset by price reductions at selected fragrance accounts worldwide as well as the negative impacts coming from some underutilized fixed costs in Europe.

CLOSURES SEGMENT

The Closures segment designs and manufactures primarily dispensing closures. These products are sold primarily to the personal care, household and food/beverage markets.

Three Months Ended March 31,	2006		2005
Net Sales	$	105,488	$	94,745
Segment Income		10,537		8,262
Segment Income as a percentage of Net Sales		10.0%		8.7%

          Net sales for the quarter ended March 31, 2006 increased 11% in the first quarter of 2006 to $105.5 million compared to $94.7 million in the first quarter of the prior year. The strengthening U.S. dollar compared to the Euro negatively impacted the sales increase. Acquisitions accounted for approximately $3.0 million or 3% of the sales increase. Sales excluding foreign currency changes and acquisitions to the personal care market increased approximately 6% in the first quarter of 2006 compared to the same period in the prior year, while sales to the food/beverage market increased 33% and household decreased 12%.

          Segment Income in the first quarter of 2006 increased approximately 28% to $10.5 million compared to $8.3 million reported in the same period in the prior year. The increase in segment income is primarily derived from increased sales volumes in the quarter. The acquisition of the net assets of CCL Dispensing had an immaterial impact on segment income in the first quarter of 2006.

PHARMACEUTICAL SEGMENT

Operations that sell dispensing systems to the pharmaceutical market now form the Pharma segment.

Three Months Ended March 31,	2006		2005
Net Sales	$	74,614	$	70,082
Segment Income		17,063		16,264
Segment Income as a percentage of Net Sales		22.9%		23.2%

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          Our net sales for the Pharmaceutical segment grew by 6% in the first quarter of 2006 to $74.6 million compared to $70.1 million in the first quarter of 2005. The strengthening U.S. dollar compared to the Euro negatively impacted the sales increase. Net sales excluding changes in foreign currency exchange rates increased approximately 14% from the prior year. An increase in tooling sales in the quarter contributed approximately $3.7 million of the sales increase. Increased selling prices to this market accounted for approximately $1.2 million of the increased sales.

          Segment Income in the first quarter of 2006 increased approximately five percent to $17.1 million compared to $16.3 million reported in the same period in the prior year but decreased slightly as a percentage of net sales. Higher tooling sales in the quarter which typically have lower margins than our product sales was the primary reason for the decrease in segment income as a percentage of sales.

FOREIGN CURRENCY

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial statements of our foreign entities. Our primary foreign exchange exposure is to the Euro, but we have foreign exchange exposure to South American and Asian currencies, among others. We manage our foreign exchange exposures principally with forward exchange contracts to hedge certain transactions and firm purchase and sales commitments denominated in foreign currencies. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial statements. Conversely, a U.S. weakening dollar has an additive effect. In some cases, we sell products denominated in a currency different from the currency in which the related costs are incurred. Changes in exchange rates on such inter-country sales could materially impact our results of operations.

QUARTERLY TRENDS

Our results of operations in the second half of the year typically are negatively impacted by customer plant shutdowns in the summer months in Europe and plant shutdowns in December. In the future, our results of operations in a quarterly period could be impacted by factors such as changes in product mix, changes in material costs, changes in growth rates in the industries to which our products are sold, recognition of equity based compensation expense for retirement eligible employees in the period of grant and changes in general economic conditions in any of the countries in which we do business.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash flow from operations and our revolving credit facility. Cash and equivalents decreased to $120.2 million from $117.6 million at December 31, 2005. Total short and long-term interest bearing debt increased in the first quarter of 2006 to $265.7 million from $246.6 million at December 31, 2005. The ratio of our Net Debt (interest bearing debt less cash and cash equivalents) to Net Capital (stockholder’s equity plus Net Debt) increased to approximately 15% compared to 14% as of December 31, 2005.

          In the first quarter of 2006, our operations provided approximately $31.5 million in cash flow compared to $31.8 million for the same period a year ago. In both periods, cash flow from operations was primarily derived from earnings before depreciation and amortization. The slight decrease in cash flow is primarily attributable to an increase in working capital needs to support the growth in the business offset primarily by an increase in earnings before depreciation, amortization and non-cash stock option expense. During the first quarter of 2006, we utilized the majority of the operating cash flows to finance capital expenditures.

          We used $47.6 million in cash for investing activities during the first quarter of 2006, compared to $54.1 million during the same period a year ago. The decrease in cash used for investing activities is due primarily to $8.5 million less spent on acquisitions in the first quarter of 2006 compared to the prior year. The acquisition of the net assets of CCL Dispensing in 2006 was financed primarily with an increase in short-term borrowings. Cash outlays for capital expenditures for 2006 are estimated to be approximately $110 million.

          We received approximately $16.2 million in cash provided by financing activities in the first quarter of 2006 compared to $3.3 million in the first quarter of the prior year. The increase in cash provided from financing activities is due primarily to an increase of approximately $3.2 million in short term borrowings, an increase in proceeds from stock option exercises of $4.3 million combined with less cash spent on to buy back shares of our own common stock of $7.7 million.

          Our revolving credit facility and certain long-term obligations require us to satisfy certain financial and other covenants including:

	Requirement	Level at March 31, 2006
Interest coverage ratio	At least 3.5 to 1	19 to 1
Debt to total capital ratio	Maximum of 55%	24%

          Based upon the above interest coverage ratio covenant, we could borrow additional debt up to a limit where interest expense would not exceed approximately $59 million. Actual interest expense for the past four quarters was approximately $13.2 million. Based upon the above debt to capital ratio covenant we would have the ability to borrow an additional $774 million before the 55% requirement would be exceeded.

          Our foreign operations have historically met cash requirements with the use of internally generated cash or borrowings. Foreign subsidiaries have financing arrangements with several foreign banks to fund operations located outside the U.S., but all these lines are uncommitted. Cash generated by foreign operations has generally been reinvested locally. The majority of our $120 million in cash and equivalents is located outside of the U.S. In 2005, we decided to repatriate in 2006 a portion (approximately $12 million) of non-U.S. subsidiary current year earnings. We provided for additional taxes of approximately $.6 million in 2005 for this repatriation.

15

          We believe we are in a strong financial position and have the financial resources to meet business requirements in the foreseeable future. We have historically used cash flow from operations as our primary source of liquidity. In the event that customer demand would decrease significantly for a prolonged period of time and negatively impact cash flow from operations, we would have the ability to restrict and significantly reduce capital expenditure levels, which historically have been the most significant use of cash for us. A prolonged and significant reduction in capital expenditure levels could increase future repairs and maintenance costs as well as have a negative impact on operating margins if we were unable to invest in new innovative products.

          The Board of Directors declared a quarterly dividend of $.20 per share payable on May 19, 2006 to stockholders of record as of April 28, 2006.

OFF-BALANCE SHEET ARRANGEMENTS

We lease certain warehouse, plant and office facilities as well as certain equipment under noncancelable operating leases expiring at various dates through the year 2018. Most of the operating leases contain renewal options and certain equipment leases include options to purchase during or at the end of the lease term. We have an option on one building lease to purchase the building during or at the end of the term of the lease at approximately the amount expended by the lessor for the purchase of the building and improvements, which was the fair value of the facility at the inception of the lease. This lease has been accounted for as an operating lease. If the Company exercises its option to purchase the building, the Company would account for this transaction as a capital expenditure. If the Company does not exercise the purchase option by the end of the lease in 2008, the Company would be required to pay an amount not to exceed $9.5 million and would receive certain rights to the proceeds from the sale of the related property. The value of the rights to be obtained relating to this property is expected to exceed the amount paid if the purchase option is not exercised. Other than operating lease obligations, we do not have any off-balance sheet arrangements.

ADOPTION OF ACCOUNTING STANDARDS

In February 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 155 “Accounting for Certain Hybrid Financial Instruments — An Amendment of FASB Statements No. 133 and 140.” This Statement allows financial instruments that have embedded derivatives to be accounted for as a whole (eliminating the need to bifurcate the derivative from its host) if the holder elects to account for the whole instrument on a fair value basis. SFAS No. 155 is effective for all financial instruments acquired or issued after the beginning of an entity’s first fiscal year that begins after September 15, 2006. The Company has performed a preliminary evaluation and determined that it currently does not have any embedded derivatives and as a result the adoption of this accounting pronouncement is not expected to have an impact on the financial results of the Company.

CRITICAL ACCOUNTING POLICIES

The preparation of our consolidated financial statements in conformity with U.S. GAAP often requires us to make judgments, estimates and assumptions regarding uncertainties that affect the results of operations, financial position and cash flows of the Company, as well as the related footnote disclosures. Management bases its estimates on knowledge of our operations, markets in which we operate, historical trends, and other assumptions. Actual results could differ from these estimates under different assumptions or conditions.

          As discussed in Item 7, “Management’s Discussion and Analysis of Consolidated Results of Operations and Financial Condition” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2005, management considers the Company’s policies on Impairment of Goodwill, Allowance for Doubtful Accounts, Valuation of Pension Benefits and Income Taxes on Undistributed Earnings of Foreign Subsidiaries to be the most important to the portrayal of AptarGroup’s financial condition and results of operations because they require the use of estimates, assumptions and the application of judgment.

          Effective January 1, 2006, the Company adopted SFAS No. 123R, “Share-Based Payment”. With the adoption of SFAS 123R, AptarGroup has added “Share-Based Compensation” as a critical accounting policy.

Share-Based Compensation

The Company has adopted the modified prospective method of applying SFAS 123(R) which requires the recognition of compensation expense on a prospective basis. Accordingly, prior period financial statements have not been restated.

          Among its provisions, SFAS 123R requires the Company to recognize compensation expense for equity awards over the service period based on their grant-date fair value. The compensation expense is recognized only for share-based payments expected to vest and we estimate forfeitures at the date of grant based on the Company’s historical experience and future expectations.

          The Company uses the Black-Scholes option-valuation model to value stock options, which requires the input of subjective assumptions. These assumptions include the length of time employees will retain their vested stock options before exercising them (“expected term”), the estimated volatility of the Company’s stock price, risk-free interest rate, the expected dividend yield and stock price. The expected term of the options is based on historical experience of similar awards, giving consideration to the contractual terms, vesting schedules and expectations of future employee behavior. The expected term determines the period for which the risk-free interest rate and volatility must be applied. The risk-free interest rate is based on the expected U.S. Treasury rate over the expected term. Expected stock price volatility is based on historical volatility of the Company’s stock price. Dividend yield is management’s long-term estimate of annual dividends to be paid as a percentage of share price.

          For 2006, the impact of adopting SFAS 123R is expected to reduce our operating income by $13.3 million and our diluted earnings per share by $0.24. Future changes in the subjective assumptions used in the Black-Scholes option-valuation model or estimates associated with forfeitures could materially affect the share-based compensation expense, and consequently, the related amounts recognized in the Condensed Consolidated Statement of Income.

16

OUTLOOK

We expect sales to continue to increase in the second quarter in spite of the potential negative impact expected from a continued stronger U.S. dollar relative to the Euro. In spite of continued pricing pressure, sales in the Beauty and Home segment are expected due primarily to the acquisitions in the fourth quarter of 2005. In addition, sales of high-end fragrance/cosmetic products are expected to improve due to a strong order book at the end of the first quarter. This may be somewhat offset by a softening in sales to the personal care market in the U.S. Sales in the Closures segment are also expected to increase over the prior year due partially to the full quarter impact of the acquisition of CCL Dispensing as well as increased volumes of the core products. Unit sales in the Pharma segment are expected to improve, but overall sales are expected to decline in the second quarter due to lower custom tooling sales and negative currency effects.

          Raw material costs are expected to continue to rise in the second quarter, in particular plastic resin costs and to a lesser degree metal costs. This may have a negative impact on the anticipated results if delays or difficulties are encountered in passing through these additional costs to customers.

          Stock option expense is expected to negatively impact diluted earnings per share by approximately $.04 per share in the second quarter.

          We anticipate that diluted earnings per share for the second quarter of 2006 will be in the range of $.70 to $.75 per share including the $.04 negative impact coming from stock option expenses, compared to $.81 per share in the prior year which included a $.09 per share positive impact from reduced income taxes related to research and development credits in the U.S. and tax law changes in Italy.

FORWARD-LOOKING STATEMENTS

This Management’s Discussion and Analysis and certain other sections of this Form 10-Q contain forward-looking statements that involve a number of risks and uncertainties. Words such as “expects,” “anticipates,” “believes,” “estimates,” and other similar expressions or future or conditional verbs such as “will,” “should,” “would” and “could” are intended to identify such forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on our beliefs as well as assumptions made by and information currently available to us. Accordingly, our actual results may differ materially from those expressed or implied in such forward-looking statements due to known or unknown risks and uncertainties that exist in our operations and business environment, including but not limited to:

• difficulties in product development and uncertainties related to the timing or outcome of product development;

• the cost and availability of raw materials (particularly resin);

• our ability to increase prices;

• our ability to contain costs and improve productivity;

• our ability to meet future cash flow estimates to support our goodwill impairment testing;

• direct or indirect consequences of acts of war or terrorism;

• difficulties in complying with government regulation;

• competition (particularly from Asia) and technological change;

• our ability to protect and defend our intellectual property rights;

• the timing and magnitude of capital expenditures;

• our ability to successfully integrate our recent acquisitions and our ability to identify potential new acquisitions and to successfully acquire and integrate such operations or products;

• significant fluctuations in currency exchange rates;

• economic and market conditions worldwide;

• changes in customer spending levels;

• work stoppages due to labor disputes;

• the timing and recognition of the costs of the workforce redeployment program in France;

• the demand for existing and new products;

• significant product liability claims;

• other risks associated with our operations.

          Although we believe that our forward-looking statements are based on reasonable assumptions, there can be no assurance that actual results, performance or achievements will not differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

17

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of our entities. Our primary foreign exchange exposure is to the Euro, but we also have foreign exchange exposure to South American and Asian currencies, among others. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial condition and results of operations. Conversely, a weakening U.S. dollar has an additive effect.

          Additionally, in some cases, we sell products denominated in a currency different from the currency in which the related costs are incurred. Any changes in exchange rates on such inter-country sales may impact our results of operations.

          We manage our exposures to foreign exchange principally with forward exchange contracts to hedge certain firm purchase and sales commitments and intercompany cash transactions denominated in foreign currencies.

          The table below provides information as of March 31, 2006 about our forward currency exchange contracts. All the contracts expire before the end of the first quarter of 2007.

	Contract Amount		Average Contractual
Buy/Sell	(in thousands)		Exchange Rate
Euro/U.S. Dollar	$	29,619		1.2108
Swiss Francs/Euro		13,575		.6395
Canadian Dollars/Euro		6,968		.6764
Euro/British Pounds		2,048		.6905
U.S. Dollar/Euro		1,668		.8334
U.S. Dollar/Mexican Peso		1,622		10.8239
Euro/Japanese Yen		1,474		138.9017
Russian Ruble/Euro		1,127		.0298
Chinese Yuan/Japanese Yen		1,104		14.7951
U.S. Dollar/Indian Rupee		1,000		45.0350
Other		5,007
Total	$	65,212

          As of March 31, 2006, we have recorded the fair value of foreign currency forward exchange contracts of $29 thousand in accounts payable and accrued liabilities in the balance sheet.

          At March 31, 2006, we had a fixed-to-variable interest rate swap agreement with a notional principal value of $25 million which requires us to pay an average variable interest rate (which was 4.5% at March 31, 2006) and receive a fixed rate of 6.6%. The variable rate is adjusted semiannually based on London Interbank Offered Rates (“LIBOR”). Variations in market interest rates would produce changes in our net income. If interest rates increase by 100 basis points, net income related to the interest rate swap agreement would decrease by less than $.2 million assuming a tax rate of 32%. As of March 31, 2006, we recorded the fair value of the fixed-to-variable interest rate swap agreement of $1.2 million in miscellaneous other assets with an offsetting adjustment to debt. No gain or loss was recorded in the income statement in 2006 since there was no hedge ineffectiveness.

ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

The Company’s management has evaluated, with the participation of the chief executive officer and chief financial officer of the Company, the effectiveness of the Company’s disclosure controls and procedures (as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of March 31, 2006. Based on that evaluation, the chief executive officer and chief financial officer have concluded that these controls and procedures were effective as of such date.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

No change in the Company’s internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) occurred during the Company’s fiscal quarter ended March 31, 2006 that materially affected, or is reasonably like to materially affect, the Company’s internal control over financial reporting.

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PART II — OTHER INFORMATION

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

RECENT SALES OF UNREGISTERED SECURITIES

During the quarter ended March 31, 2006, the FCP Aptar Savings Plan (the “Plan”) purchased 400 shares of our Common Stock on behalf of the participants at an average price of $54.07 per share, for an aggregate amount of $21.6 thousand. At March 31, 2006, the Plan owns 6,500 shares of our Common Stock. The employees of AptarGroup S.A.S. and Valois S.A.S., our subsidiaries, are eligible to participate in the Plan. All eligible participants are located outside of the United States. An independent agent purchases shares of Common Stock available under the Plan for cash on the open market and we do not issue shares. We do not receive any proceeds from the purchase of Common Stock under the Plan. The agent under the Plan is Banque Nationale de Paris Paribas Asset Management. No underwriters are used under the Plan. All shares are sold in reliance upon the exemption from registration under the Securities Act of 1933 provided by Regulation S promulgated under that Act.

ISSUER PURCHASES OF EQUITY SECURITIES

The following table summarizes the Company’s purchases of its securities for the quarter ended March 31, 2006:

					Total Number Of Shares		Maximum Number Of
	Total Number				Purchased As Part Of		Shares That May Yet Be
	Of Shares		Average Price		Publicly Announced		Purchased Under The
Period	Purchased		Paid Per Share		Plans Or Programs		Plans Or Programs
1/1 — 1/31/06		0	$	—		0		1,107,700
2/1 — 2/28/06		0		—		0		1,107,700
3/1 — 3/31/06		85,700		53.77		85,700		1,022,000
Total		85,700	$	53.77		85,700		1,022,000

          On July 15, 2004, the Company announced that its Board of Directors authorized the company to repurchase two million shares of its outstanding common stock. There is no expiration date for this repurchase program.

ITEM 6. EXHIBITS

Exhibit 10.1 Summary of Bonus Arrangements for Executive Officers.

Exhibit 31.1 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit 31.2 Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Exhibit 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURE

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

AptarGroup, Inc. (Registrant)
By	/s/ Stephen J. Hagge
Stephen J. Hagge Executive Vice President, Chief Financial Officer and Secretary (Duly Authorized Officer and Principal Financial Officer)
Date: May 8, 2006

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INDEX OF EXHIBITS

Exhibit
Number	Description
10.1	Summary of Bonus Arrangements for Executive Officers.
31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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