For the full year 2016, the company recorded earnings from continuing operations of $1.32 per share (diluted), which compares favorably with $0.85 per share in 2015.
The company continues to generate strong cash flows. Cash provided by continuing operating activities for 2016 was $758 million compared with $612 million for 2015. Adjusted free cash flow for 2016 was $429 million, up 23% compared with the $348 million reported last year. Adjusted free cash flow excludes asbestos-related payments.
Global volumes for 2016 were up 9% compared to the prior year. Key contributors to growth were the acquired business, Europe, legacy North America, as well as Australia and New Zealand. On a global basis, volumes of all major end use categories grew year-on-year. Excluding the overall decline in shipments in Asia Pacific, organic growth increased approximately 1%.
Earnings from continuing operations before income taxes were $356 million for the year compared with $268 million for 2015. Segment operating profit of reportable segments for 2016 was $882 million, an increase of 19% compared with prior year. While all regions except Asia Pacific posted higher segment operating profit compared with prior year, the increase was largely driven by the acquired business.
“Our multi-year transformation is off to a strong start - we achieved the key financial targets that we outlined at investor day in early 2016,” CEO Andres Lopez said. “Margins expanded more than 100 basis points, due to the benefits of our strategic initiatives and the acquired business. We are executing on our strategy, overcoming visible external challenges from Brazil macros, the Brexit vote and the strengthening US dollar.”
Fourth Quarter 2016 Results
For the fourth quarter 2016, the company recorded a loss from continuing operations of $0.43 per share (diluted), which compares with earnings from continuing operations (diluted) of $0.04 per share in the same period of 2015. Loss from continuing operations before income taxes was $39 million in the quarter, which was unfavorable by $87 million compared with the same period in prior year.
These figures include significant items that management considers not representative of ongoing operations. In the fourth quarter, the company incurred restructuring and impairment charges of $110 million, primarily driven by anticipated restructuring activity in Europe, Latin America and at corporate, as well as a settlement charge of $98 million related to actions to de-risk pension liabilities.
Excluding certain items management considers not representative of ongoing operations, adjusted earnings were $0.50 per share. Adjusted earnings increased 25%, or $17 million compared with prior year, a great achievement in light of ongoing currency headwinds and recognizing that both periods reflected results from the acquired business.
Net sales in the fourth quarter of 2016 were $1.6 billion, up 1% from the prior year fourth quarter. Price was up $27 million on a global basis, primarily driven by price adjustments that reflect cost inflation. Currency translation adversely impacted net sales by $16 million, or 1%.
Global sales volumes increased 1% compared to the fourth quarter of 2015. Shipments in Europe increased 3%, mainly due to gains in beer and food shipments. In Latin America, shipments increased nearly 3% with higher shipments in all product categories except wine, which was down slightly. North America volumes were similar to the prior year with higher non-alcoholic beverage and spirits shipments offsetting lower food and beer shipments. Fourth quarter shipments in Asia Pacific were 6% below the same period of 2015.
Full Year 2016 Results
Full year net sales were $6.7 billion, up $546 million from 2015. The acquired business contributed $608 million in incremental sales (excluding organic growth from September through December 2016), which was partially offset by $108 million in adverse currency translation. Global shipments increased 9% in 2016. Key contributors to growth were the acquired business, Europe, legacy North America, as well as Australia and New Zealand.
Segment operating profit was $882 million in 2016, compared with $740 million in the prior year, an improvement of 19%.
Cash provided by continuing operating activities was $758 million for 2016. After deducting additions to property, plant and equipment of $454 million, and adding back asbestos-related payments of $125 million, adjusted free cash flow was $429 million, in line with management guidance of $425 million.