CROWN HOLDINGS, INC.
2008 Annual Report
Annual Meeting
We cordially invite you to attend the Annual Meeting
of Shareholders of Common Stock to be held at 9:30 a.m. on
Thursday, April 23, 2009 at the Company’s Corporate
Headquarters, One Crown Way, Philadelphia,
Pennsylvania. A formal notice of this meeting, together
with the Proxy Statement and Proxy Card, was mailed to
each shareholder of common stock of record as of the close
of business on March 10, 2009, and only holders of record
on said date will be entitled to vote. The Board of Directors
of the Company requests the shareholders of common stock
to sign proxies and return them in advance of the meeting
or register your vote by telephone or through the internet.
Table of Contents
Financial Highlights
Letter to Shareholders
Board of Directors & Corporate Officers
2008 Annual Report on Form 10-K
Division Officers
Investor Information
Financial Highlights
(in millions, except share, per share, employee, and statistical data)
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations. . . . . . . . . . . . . . . . . . . . . . .
2008
$ 8,305
1,222)
302)
,226
2007
% Change
$07,727
1,027
318
528
7.5
0019.0
0(5.0)
005((57.2)
Per average common share:
Income from continuing operations - diluted . . . . . . . . . . . . . . . .
Market price (closing). . (1) . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 1.39
19.20
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . .
Shareholders’ equity/(deficit)
$ 6,774
3,337
(317)
,000 (00, ,317))
Depreciation and amortization
Free cash flow . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 000, 0000,248
. . . . . . . . . . . . . . . . . . . . . . . .
$00,216
$003.19
25.65
$ 6,979
3,437
0,0,.115
$ 00229
000 353
06((56.4)
(25.1)
00(2.9)
(2.9)
( 0.0)
(5.7)
(29.7)
(29.7)
Number of employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shares outstanding at December 31 . . . . . . . . . . . . . . . . . . . . . .
Average shares outstanding - diluted . . . . . . . . . . . . . . . . . . . . .
21,268
159,191,238
162,931,236
21,819
159,777,628
165,464,273
00(2.5)
(0.4)
(1.5)
(1) Source: New York Stock Exchange - Composite Transactions
Reconciliation of a Non-GAAP Financial Measure:
Free cash flow is not defined under U.S. generally accepted accounting principles (GAAP). Free cash flow should not be considered
in isolation or as a substitute for cash flow data prepared in accordance with GAAP and may not be comparable to calculations of a
similarly titled measure by other companies.
The Company utilizes free cash flow for planning and evaluating investment opportunities and as a measure of its ability to incur and
service debt. Free cash flow is derived from the Company’s cash flow statements and a reconciliation to free cash flow is provided
below.
Reconciliation to Free Cash Flow
Net cash provided by operating activities . . . . . . . . . . . . . . . . .
Less: capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . .
Free cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2008
2007
$0422
(00174)
————
$0248
————
————
$0509
(00156)
—————
$ 353
—————
—————
Dear Fellow Shareholders:
We are pleased to report that 2008 was one of our Company's best years. From an operating perspective, all
of our businesses performed well. The long term growth strategy that we began to implement in 2001, and
all that we have worked so hard to accomplish, once again came together in 2008.
Net sales for the year grew to $8.3 billion, up 7.5% over the $7.7 billion in 2007 with approximately 74% of
net sales coming from outside the United States. Demand for our products was strong in virtually every
market in which we participate. We believe this serves to validate the decision we made seven years ago to
focus on metal containers and closures for strategically selected markets.
Volume in our global beverage can business, which comprised 47% of net sales, was up 4% over 2007. The
investments in new capacity that we have been making over the last several years, principally in the
growing markets of South America, North Africa, the Middle East, China and Southeast Asia, all made
significant contributions in 2008. Our food can businesses around the world, which make up 34% of net
sales, also had a solid year with volume increases over the prior year.
Pricing for our products in 2008 remained firm and we were able to charge fairly in order to recover costs
and continue to improve return for our shareholders. Importantly, we were able to pass through price
fluctuations for steel and aluminum on a global basis as they impacted us. We have been convinced for a
number of years that the unpredictability and volatility of commodity prices pose significant financial risks
to the Company and that Crown should not be betting on future prices. We believe mitigating these risks is
the most prudent way to run the business and intend to continue this practice.
Gross profit for 2008 rose $195 million, or 19%, to $1.2 billion over the $1.0 billion in 2007. The
improvement primarily reflects capacity expansions and numerous other capital projects as well as
operating improvements designed to increase efficiencies and reduce cost.
Improving operating efficiencies and productivity have long been important aspects of operating successfully
in the can industry. As a result of our ongoing efforts in response to these market driven necessities, we
believe the Company is among the best operators in our industry as measured by any accepted standard.
Consistent with the need to continually improve operations, we realigned our North American Food and
Beverage businesses in 2008 by closing two facilities and moving the production and some of the equipment
to other plants in the region and transferring other equipment to growing markets overseas. We always
regret the need to close any plant, but these actions were necessary to better match our capacity to
geographic market demand and were consistent with the Company's strategy to lower costs and enhance
returns on all deployed assets.
We also significantly strengthened the Company's balance sheet in 2008. With cash generated from
operations, we reduced net debt $239 million to $2.7 billion. The reduction of net debt combined with
increased operating earnings enabled us to reduce net leverage by 23% in 2008, significantly improving
the company's credit quality and liquidity.
Our 2008 results underscore the strength of our diverse product lines, customer base and the geographies
we serve. Metal packaging for food, beverages, personal care, home and industrial use was once again
favored by our customers and their ultimate consumers. We believe that in difficult economic times,
demand for food and beverage cans grows as consumers eat and drink more at home. From our
customers' standpoint, cans are low cost and can be filled at high speeds with very little spoilage. Equally
important, they transport easily and cheaply and protect the integrity of food, beverage and other
products for long periods of time.
Protecting our environment is also a high priority for the Company. In 2008, our commitment was
recognized by the U.S. Environmental Protection Agency for promoting resource conservation principles
that better protect the environment. Fundamental to our environmental commitment is the high degree
of sustainability of metal cans themselves. They are produced from viable sources of primary and
recycled materials and can be infinitely recycled without loss of quality. Crown is also an industry leader
in source reduction initiatives such as our patented SuperEnd™ beverage can ends. SuperEnds™ use
10% less metal than traditional beverage can ends and are available to beverage can customers on six
continents. Since its introduction in 2001, Crown and its licensees have produced more than 200 billion
SuperEnds™, saving more than 49,000 metric tons of aluminum, over 800 metric tons of coatings and
more than 400,000 metric tons of greenhouse gases, which equates to the annual emissions of 73,000 cars.
In 2008, we signed a license agreement with Toyo Seikan Kaisha, Ltd. for the manufacture and sale of
SuperEnds™ in Japan, the second major licensee of this technology in that market.
Looking ahead, our current capacity is essentially sold out and we have additional capacity coming on-
line in 2009 from a new beverage can plant in Brazil and from a new beverage can line in Spain. By
continuing to coordinate our focused investment policy with our knowledge of metal packaging and what
we believe to be the most promising geographic markets, we expect solid organic growth in 2009 and
beyond.
In December, Alan Rutherford, Vice-Chairman, Executive Vice President and Chief Financial Officer,
decided to retire as CFO. Tim Donahue, formerly Senior Vice President - Finance and an 18 year veteran
of the Company, was promoted to Executive Vice President and Chief Financial Officer. We are deeply
indebted to Alan for his dedication and outstanding service to the Company over the last 34 years. He
has been an indispensable partner to me as we worked together, along with the Crown team around the
world, to create the world's leading metal packaging company. Fortunately, Alan has agreed to remain
on our Board of Directors.
In closing, we are committed to succeed, whatever the future may bring. Undoubtedly, 2009 is going to be a
challenging year. Nonetheless, we are prepared and confident that your Company will continue to grow and
prosper by following sound, common sense business principles that have been tested in all economic times.
Best regards,
John W. Conway
Chairman of the Board, President
and Chief Executive Officer
March 16, 2009
Jenne K. Britell, Ph.D. (b)
Chairman of United Rentals and
Chairman and Chief Executive
Officer of Structured Ventures; former
Executive Officer of several General
Electric financial services companies;
also a Director of Quest Diagnostics
and U.S.-Russia Investment Fund
John W. Conway ( a )
Chairman of the Board, President and
Chief Executive Officer; also a Director
of PPL Corporation
Arnold W. Donald (c)
Former President and Chief Executive
Officer of the Juvenile Diabetes
Research Foundation International;
former Chairman and Chief Executive
Officer of Merisant Company; also a
Director of Carnival Corporation, The
Laclede Group and Oil-Dri Corporation
Board of Directors
William G. Little (b, d)
Former Chairman and Chief Executive
Officer of West Pharmaceutical Services
Alan W. Rutherford (a)
Vice Chairman of the Board
and Executive Vice President
Hans J. Löliger (c, d)
Vice Chairman of Winter Group;
former Chief Executive Officer of SICPA
Group; also a Director of Bühler
Holding, Franke Holding and Fritz
Meyer Holding
Thomas A. Ralph (a, b, d)
Retired Partner, Dechert LLP
Hugues du Rouret (b)
Chairman of Automobile Club de France
Management Company; Chairman of
the European School of Management;
Executive Vice President International
of the Chamber of Commerce and
Industry of Paris; former Chairman and
Chief Executive Officer of Shell France;
also a Director of Banque Saint-Olive,
CF Partners and Gras Savoye
Jim L. Turner (c)
Principal of JLT Beverages L.P.;
former Chairman, President and
Chief Executive Officer of Dr
Pepper/Seven Up Bottling Group;
also a Director of Dean Foods
(b)
William S. Urkiel
Former Senior Vice President and
Chief Financial Officer of IKON Office
Solutions; also a Director of Suntron
Corporation
Committees
a – Executive b – Audit c – Compensation d – Nominating and Corporate Governance
Corporate Officers
John W. Conway
Chairman of the Board, President
and Chief Executive Officer
Alan W. Rutherford
Vice Chairman of the Board and
Executive Vice President
Daniel A. Abramowicz
Executive Vice President – Corporate
Technology and Regulatory Affairs
Timothy J. Donahue
Executive Vice President and
Chief Financial Officer
Thomas A. Kelly
Senior Vice President and
Corporate Controller
William T. Gallagher
Senior Vice President, Secretary
and General Counsel
Michael F. Dunleavy
Vice President – Corporate Affairs
and Public Relations
Michael B. Burns Vice
Vice President and Treasurer
Torsten J. Kreider
Vice President – Planning
and Development
Karen E. Berigan Vice
Vice President – Corporate
Risk Management
Kevin C. Clothier
Vice President and
Assistant Corporate Controller
Michael J. Rowley
Assistant Secretary and
Assistant General Counsel
This Page Intentionally Left Blank
Division Officers
Americas Division
Raymond L. McGowan, Jr.
President
Gerard H. Gifford
President – CROWN Beverage
Packaging North America
David R. Underwood
President – CROWN Food
Packaging North America
James D. Wilson
President – CROWN Aerosol
Packaging USA
Joseph R. Pierce
President – CROWN Closures
and Specialty Packaging USA
Ramiro Barney Dussan
President – CROWN
Latin America and Caribbean
Gary L. Burgess
Senior Vice President –
Human Resources
David R. Underwood
Rinaldo Lopes
President – CROWN Beverage
Packaging South America
Edward C. Vesey
Senior Vice President – Sourcing
E. C. Norris Roberts
Executive Vice President –
Information Systems,
Planning and World-Class
Performance
Patrick D. Szmyt
Senior Vice President
and Chief Financial Officer
Richard A. Forti
Vice President, Technical Services
– CROWN Food and Aerosol
Packaging North America
Asia-Pacific Division
Jozef Salaerts
President
Hock Huat Goh
Senior Vice President – Human Resources
and Chief Financial Officer
Siu Kee Tse
Vice President – China
and Hong Kong
Ng Seng Yap
Vice President – Beverage Cans –
South East Asia
Patrick Lee
Vice President – Thailand
Gary Fishlock
Vice President – Manufacturing
Patrick Ng
Director – Purchasing
European Division
Christopher Homfray
President
Peter Calder
Senior Vice President – Human
Resources and Communications
Terry Cartwright
Senior Vice President – CROWN
Bevcan Europe and Middle East
John Clinton
Senior Vice President – Sourcing
Howard Lomax
Senior Vice President and
Chief Financial Officer
Peter Nuttall
Senior Vice President –
CROWN Food Europe
Lakon Holloway
Vice President and
General Counsel
Nicolas Anthon
Vice President – CROWN
Aerosols Europe
Martin Reynolds
Vice President – External
and Regulatory Affairs
Peter Collier
Vice President – CROWN
Closures Europe
Pierre Sirbat
Vice President – Environment,
Quality and WCP
Eddy Geelen
Vice President – Health and Safety
Didier Sourisseau
Vice President – CROWN
Speciality Packaging Europe
Olivier Grienenberger
Director – Planning and Logistics
CROWN Packaging Technology
Daniel A. Abramowicz
President
Michael J. A. Curtis
Vice President –
Engineering Development
Leonard Jenkins
Vice President –
Technology Development
Ian Bucklow
Director –
Materials Development
Nigel Wakely
Director – Finance
Investor Information
Company Profile
Crown Holdings, Inc. is a leading manufacturer of packaging products for consumer marketing companies
around the world. We make a wide range of metal packaging for food, beverage, household and personal care
and industrial products and metal vacuum closures and caps. As of December 31, 2008, the Company operated
139 plants located in 41 countries, employing 21,268 people.
STOCK TRADING INFORMATION
Stock Symbol: CCK (Common)
Stock Exchange Listing: New York Stock Exchange
Corporate Headquarters
One Crown Way
Philadelphia, PA 19154-4599
Main phone: (215) 698-5100
Shareholder Services
Registered shareholders needing information about stock
holdings, transfer requirements, registration changes, account
consolidations, lost certificates or address changes should
contact the Company’s stock transfer agent and registrar:
Mailing Address:
Wells Fargo Bank Minnesota, N.A.
Shareholder Services
161 North Concord Exchange
South St. Paul, MN 55075
General Telephone Number:
1-800-468-9716
Internet website:
http://www.wellsfargo.com/shareownerservices
Owners of shares held in street name (shares held by any bank
or broker in the name of the bank or brokerage house) should
direct communications or administrative matters to their bank
or stockbroker.
Form 10-K and Other Reports
The Company will provide without charge a copy of its 2008
Annual Report on Form 10-K, excluding exhibits, as filed with
the U.S. Securities and Exchange Commission (“SEC”). To
request a copy of the Company’s annual report, call toll free
888-400-7789. Canadian callers should dial 888-757-5989.
Copies in electronic format of the Company’s annual report
and filings with the SEC are available at the Company’s
website at http://www.crowncork.com in the For Investors
section under Annual Report and SEC filings.
Internet
Visit our website on the internet at http://www.crowncork.com
for more information about the Company, including news
releases and investor information.
Certifications
The Company included as Exhibit 31 to its 2008 Annual Report
on Form 10-K, as filed with the U.S. Securities and Exchange
Commission, certifications of the Chief Executive Officer and
Chief Financial Officer of the Company. The CEO and CFO
certify to, among other things, the information contained in the
Company’s Form 10-K. The Company has also submitted to
the New York Stock Exchange a certification from the CEO
certifying that he is not aware of any violation by the Company
of New York Stock Exchange corporate governance listing
standards.
INCORPORATED — COMMONWEALTH OF
PENNSYLVANIA
This report is printed on recycled paper using soy based inks.
Crown Holdings, Inc.
Corporate Headquarters
One Crown Way
Philadelphia, PA 19154-4599