July 27, 2011 / 1:27 PM / 7 years ago

UPDATE 1-Silgan Q2 profit misses estimates on raw material costs

* Q2 rev $822.2 mln vs est $814 mln

* Sees Q3 adj EPS $1.05-$1.15

* Backs FY 2011 EPS view $2.60-$2.70 (Follows alerts)

July 27 (Reuters) - Consumer goods packager Silgan Holdings Inc’s second-quarter profit missed market estimates by a cent as margins at its top two segments fell, hurt by higher raw material costs.

The company said its acquisitions — IPEC, DGS and Vogel & Noot — contributed strongly and helped offset the higher resin costs in its closures and plastics segments.

Despite higher volumes and selling prices, margins at metal containers, its largest segment, slipped to 8.9 percent from 11.6 percent as it incurred a $3.3 million charge to settle a product liability dispute.

Margins at its closures segment fell to 12.3 percent from 14.5 percent as it failed to pass on higher cost of resin, a key raw material for packagers, to customers.

The company, which competes with Ball Corp and Crown Holdings Inc , backed its full-year adjusted earnings estimate of $2.60-$2.70 per share. Third-quarter adjusted earnings was forecast at $1.05-$1.15 per share.

Silgan, which last month lost out to New Zealand’s Rank Group to buy Graham Packaging Co Inc , posted April-June net income of $51.2 million, or 73 cents a share, up from $36.3 million, or 47 cents a share, a year ago.

Excluding items, it earned 53 cents a share.

Revenue rose 18.5 percent to $822.2 million.

Analysts, on average, had expected earnings of 54 cents a share on revenue of $814 million, according to Thomson Reuters I/B/E/S.

Shares of the Stamford, Connecticut-based company closed at $39.02 on Tuesday on Nasdaq. (Reporting by Sharanya Hrishikesh in Bangalore; Editing by Joyjeet Das)

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