Silgan Holdings, Inc. SLGN
Q4 2010 Earnings Call Transcript

Operator: Mark Wilde, Deutsche Bank.

Mark Wilde - Deutsche Bank: Tony, I wondered as we just look through the press release and listen to the commentary, we heard a lot of comments about weaker mix, lower mix, and I wondered if you could just talk about this issue across your different businesses and whether that trend is going to reverse itself in 2011.

Anthony J. Allott - President and CEO: Sure. I’ll let Adam maybe take a piece of this but I think broadly you have to look into the individual businesses and what's driving it. I think you could, in some cases, you could argue that has a bit to do with the economy. Certainly, as I think about what drove it in our plastics business, it certainly had to do with negative economy. So I think the answer there is a question; if that recovers, what happens? If the economy comes back, do you expect to see improvement there? In the case of the can business, it's a bit of mix. It's somewhat what markets are growing and which ones aren't. It is a good point to caution. Mix is sort of a tricky question, because it's – when we make comments about volume, we use a standard drop-through value and so sometimes, it’s not – not so the margins are worse. It's more a question of the drop-through value of the product. It sounds more negative than we mean it to. It's just that we're saying volume did X and then mix did Y in maybe good margin business but on a per unit basis, it's a lower drop-through. I can figure that in the can business, particularly that relates.

Adam J. Greenlee - EVP and COO: I would also say that's applicable to plastics and closures as well when you look at the product mix and the absolute dollar drop-through associated with a mix of different products.

Mark Wilde - Deutsche Bank: Then another question. You've announced another plastics plant rationalization, so this is two closures announced in about a year. I wondered if you're rethinking strategy in that business or if it's just that a change in business dynamics that you are seeing in that plastics business that’s driving this?

Anthony J. Allott - President and CEO: Sure, it's a good question. I would not say it's particularly a change in the dynamics of the business although there is bits of that. But mostly, what this is, is us reacting to what we've talked about many times in this call, which is that from a trend perspective, we think the plastics business we're disappointed by it, quite frankly. So we are just getting at the cost side of the business in a lot of different ways. So, the Port Clinton rationalization which we went through in 2010 was not at all about the volume leading to it, it was – in fact the hard part of that shutdown is that we really had to move all those assets to other plants which made it a full year and frankly, a much more challenging rationalization than we had anticipated. But that’s all about getting some of the overhead costs out by consolidating plants. So mostly, it's us just getting at the cost side. There is also, as you saw in the quarter, we are going in other plant as you pointed out that has to do with sort of the cost basis of the technology in that plant and efforts that we have been underway to identify technologies at a lower cost basis. So, once again that is predominantly driven by the opportunity to get some costs out. As it happens, that plant is a little bit affected by the market because it is the higher price point product. So, there has been some market impact there but the plant closure has more to do with us try to get out at different lower cost based technology.