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Metal & Glass Containers Index: producers face price challenge

Standard & Poor“s reported that its Metal & Glass Containers Index rose 4% in the year to 12 May 2006. The ratings agency said this matched the return on its S&P 1500 Composite Index of US shares. S&…

Standard & Poor“s reported that its Metal & Glass Containers Index rose 4% in the year to 12 May 2006. The ratings agency said this matched the return on its S&P 1500 Composite Index of US shares. S&P says it maintains its neutral investment outlook for the Metal & Glass Containers group, as it expects a modest rebound in unit shipments and a challenging pricing environment. Two companies account for about 75% of the group“s market capitalization. Although S&P thinks that most container companies will be able to pass on higher raw material costs to customers, energy prices are seen as staying volatile. S&P also thinks a resolution (effective in May 2006) to the mandatory beverage can deposit law in Germany should gradually benefit results. Some packaging companies plan to consolidate underperforming facilities in Europe as they focus on new product development.

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