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Crown makes $7.2M investment in Batesville plant

Batesville — Of 183 locations in 44 countries, Crown Holdings Inc. (NYSE: CCK), a leading manufacturer of packaging products to consumer marketing companies around the world, selected its Batesville beverage can plant, Crown Cork & Seal, as the site of a $7.2-million investment, bringing its total investment in the Mississippi plant to $14 million within 18 months.

In September 2004, the Philadelphia, Pa.-based corporation invested some $7 million in the Batesville plant to improve production efficiencies and to make the plant the company’s national 8-ounce beverage can center. The company makes one of every five beverage cans used in the world, and one of every three food cans used in North America and Europe.

“Crown was able to make both significant investments because of legislation enacted in Mississippi and signed by the governor, which has made Mississippi a more attractive place for companies to invest and grow their operations,” said Bill Gallagher, senior vice president and general counsel for Crown.

The investment program began in the third quarter of 2004, and included the conversion of one of Batesville’s three production lines to manufacture eight-ounce cans and to upgrade and expedite the existing two lines.

“Crown was confident the investment program would enhance the Batesville plant’s position in an increasingly competitive marketplace,” said Bob Truitt, president of Crown’s beverage packaging division.

The new multi-million dollar investment will cover equipment costs and infrastructure expenses to add a new line to create a 16-ounce size can the plant does not currently manufacture.

“Our types of production lines are built in pairs and the crews work both sides of the line, so lines are built in twos,” explained Mike Dunleavy, vice president of corporate affairs and public relations for Crown. “At the Batesville plant, we have three lines. This will add a fourth line.”

Two lines make 12-ounce size cans for Dr. Pepper, Pepsi-Cola and other consumer beverages. A third line makes a swing size, vacillating between eight-ounce and 12-ounce size cans. The fourth line will manufacture 16-ounce cans for Hansen’s Energy drinks and Dr. Pepper.

“We’re making this investment because the market for this new size can is growing and we need to be active in it,” said Dunleavy.

The company, which is not adding other lines to any other U.S. plant, plans to begin production of the fourth line at the Batesville plant later this year.

The Crown Cork & Seal plant in Batesville is Panola County’s fourth-largest employer, with 225 workers. “While the new line won’t add any jobs, it will extend the economic viability of the plant,” said Dunleavy. “The fact that it went to Batesville is, quite honestly, because of the very good business climate that exists in Mississippi.”

Crown has won numerous industry awards for the design and production of consumer packaging. Last year, the company was recognized with nine different awards, including the Supreme Gold Award, the competition’s top honor, from the Metal Packaging Manufacturers Association.

For 2005, Crown reported net sales of $6.9 billion, an increase of 5.8% over the $6.5 billion the previous year. Compared to 2004, the Americas division’s net sales increased 5.3%; the European division’s net sales were up 5%; and the Asia division’s net sales grew 16.9%. Gross profit for the year increased to $900 million, up 11.8% over the $805 million reported for 2004. As a percentage of net sales, gross profit expanded to 13% compared to 12.3% in 2004. The improvements are partially attributed to increased operating efficiencies and productivity throughout the company.

Contact MBJ contributing writer Lynne W. Jeter at Lynne.Jeter@gmail.com.

About Lynne W. Jeter

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