Crown Cork & Seal Company, the US-based packaging giant, announced strong results for the third quarter and nine months ended 30 September 2002, surging into the black thanks to reduced operational costs.

The global supplier of food and beverage cans reported third-quarter net income after a gain of $71 million (€72.2m), or 45 cents per diluted share, compared to a loss of $13 million, or 10 cents per share a year ago.

Net sales in the third quarter were down to $1.9 billion compared to $2.0 billion in the third quarter of 2001, reflecting divested operations which accounted for $55 million in the third quarter of 2001, the pass-through of lower raw material costs and volume decreases in certain product lines.

These factors, according to the company, were partially offset by the positive effects of $64 million in stronger foreign currencies as well as increased selling prices and improved volumes across certain product lines.

Gross profit (net sales less cost of products sold) as a percentage of net sales in the third quarter increased to 18.7 per cent compared to 15.4 per cent in the same period last year. The improvement resulted from price increases, improved operating performance and continuing cost-reduction efforts.

Third quarter operating income increased to $165 million, or 8.7 per cent of net sales, an improvement of 47.3 per cent over the $112 million, or 5.6 per cent of net sales, reported in the 2001 third quarter. Excluding the impact of goodwill amortisation from last year's third quarter results and non-cash pension expense/income from both the third quarter of 2002 and 2001, respectively, operating income increased to $173 million, or 9.1 per cent of net sales.

This reflected an improvement of $45 million, or 35.2 per cent over operating income in last year's third quarter of $128 million, or 6.4 per cent of net sales.

For the nine months, after excluding goodwill amortisation and pension expense/income, operating income was $448 million, or 8.5 per cent of net sales, an improvement of $92 million or 25.8 per cent over operating income in the comparable period last year.

John W. Conway, chairman and chief executive officer, commented: "During the quarter, we drove continued improvement across all divisions, as shown by the measures we consider important to this Company's success. Productivity was improved and costs were tightly controlled. Working capital was managed carefully and showed substantial improvement compared to the prior year. The pricing environment and associated margins are stable to improving, and industry fundamentals in the regions in which we operate continued to be good."

In the Americas division, operating income in the third quarter increased to 7.9 per cent of net sales over the 4.6 per cent in last year's third quarter.

In the European division operating income in the third quarter increased to 12.0 per cent of net sales from 9.0 per cent in last year's same quarter. Excluding the impact of goodwill amortisation from the prior year and non-cash pension income from both the 2002 and 2001 third quarters, operating income improved to 11.2 per cent of net sales in the quarter from 9.1 per cent in the prior year period. Year-to-date, operating income increased to 10.2 per cent of net sales compared to 9.7 per cent for the same nine-month period of 2001.

In the Asia-Pacific division, third quarter operating income improved to 12.8 per cent of net sales from 9.4 per cent in the third quarter last year. In the nine-month period operating income increased to 11.7 per cent of net sales compared to 7.9 per cent for the same period of 2001.

Conway added: "Notwithstanding our excellent operating performance through the first nine months, we remain focused on strengthening our balance sheet through debt reduction."

Crown Cork & Seal is a leading supplier of packaging products to consumer marketing companies around the world. World headquarters are located in Philadelphia, Pennsylvania.