Ball Corp. Issues $750M Notes - Analyst Blog
February 28 2012 - 10:30AM
Zacks
Ball Corporation (BLL) proposed to issue $750
million of unsecured notes. The offering would yield 5.0%
interest per year and the notes will mature on March 15, 2022.
Ball Corporation intends to utilize the proceeds of the new debt
issue to fund the interest and expenses related to the debt issue.
It will also fund for related consent solicitation for
any and all of its outstanding 6 5/8% senior notes due 2018, and
for general corporate purposes.
The debt-to-capital ratio at 2011 end was 69.5%, higher than
62.9% at 2010 end. The debt level of the company is expected to
rise further with this note offering. In addition, the company will
also have to incur a higher interest expense to service the
debt.
During the fourth quarter of 2011, the company posted adjusted
earnings of 48 cents per share compared to 53 cents per share in
the year-ago quarter. The adjusted earnings per share fell short of
the Zacks Consensus Estimate of 54 cents.
The poor performance was attributable to the weaker beverage can
volumes in North America and Europe as well as six fewer accounting
days. This was, however, partially offset by a strong operating
performance and growth in specialty products.
The company plans to achieve 10%-15 % earnings growth in 2012
and beyond. It also expects to generate nearly $450 million of free
cash flow to be used to repurchase stocks.
The company’s focus on “Drive for 10 Actions” is set to deliver
better results over the next decade. The company’s efforts in
maintaining continuous growth in 2011 has built the momentum for a
strong start towards its goals set for the coming years.
Currently the shares of Ball Corporation retain a Zacks #3 Rank
(short-term Hold recommendation). The Zacks Consensus Estimate for
the first quarter of 2012 is pegged at 59 cents.
Based inBroomfield, Colorado, Ball Corp. is a manufacturer of
metal and plastic packaging, primarily for beverages and foods. It
also supplies aerospace and other technologies and services to
government and commercial customers.
The company operates through five segments and employs 14,000
people worldwide. It competes with the likes of Crown
Holdings Inc. (CCK), Rexam
Plc. (REXMY) and Silgan Holdings
Inc. (SLGN).
BALL CORP (BLL): Free Stock Analysis Report
CROWN HLDGS INC (CCK): Free Stock Analysis Report
REXAM PLC-ADR (REXMY): Free Stock Analysis Report
SILGAN HOLDINGS (SLGN): Free Stock Analysis Report
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