UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549-1004

FORM 10-Q

[X]		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2007

[ ]		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM                      TO                     

AptarGroup, Inc.

DELAWARE (State of Incorporation)		36-3853103 (I.R.S. Employer Identification No.)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Act. (Check one):

Large accelerated filer þ                    Accelerated filer o                    Non-accelerated filer o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date (October 23, 2007).

Common Stock		68,333,551

AptarGroup, Inc.

Form 10-Q

Quarter Ended September 30, 2007

INDEX

Part I.		FINANCIAL INFORMATION
Item 1.		Financial Statements (Unaudited)
		Condensed Consolidated Statements of Income — Three and Nine Months Ended September 30, 2007 and 2006			1
		Condensed Consolidated Balance Sheets — September 30, 2007 and December 31, 2006			2
		Condensed Consolidated Statements of Cash Flows — Nine Months Ended September 30, 2007 and 2006			4
		Notes to Condensed Consolidated Financial Statements			5
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations			13
Item 3.		Quantitative and Qualitative Disclosures about Market Risk			19
Item 4.		Controls and Procedures			19
Part II.		OTHER INFORMATION
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds			20
Item 6.		Exhibits			20
		Signature			21
Certification
Certification
Section 1350 Certification
Section 1350 Certification

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

AptarGroup, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

In thousands, except per share amounts

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net Sales		$	485,692			$	404,905			$	1,408,409			$	1,178,998
Operating Expenses:
Cost of sales (exclusive of depreciation shown below)			330,438				274,517				949,293				796,821
Selling, research & development and administrative			65,773				57,406				205,303				177,863
Depreciation and amortization			32,065				28,340				92,246				83,503
			428,276				360,263				1,246,842				1,058,187
Operating Income			57,416				44,642				161,567				120,811
Other Income (Expense):
Interest expense			(4,880	)			(4,479	)			(14,335	)			(12,186	)
Interest income			2,222				1,012				5,600				2,753
Equity in results of affiliates			158				177				426				420
Minority interests			(22	)			38				(4	)			(94	)
Miscellaneous, net			(303	)			(219	)			(1,513	)			(1,154	)
			(2,825	)			(3,471	)			(9,826	)			(10,261	)
Income Before Income Taxes			54,591				41,171				151,741				110,550
Provision for Income Taxes			15,196				12,928				45,798				34,829
Net Income		$	39,395			$	28,243			$	105,943			$	75,721
Net Income Per Common Share:
Basic		$	0.58			$	0.41			$	1.54			$	1.08
Diluted		$	0.56			$	0.40			$	1.48			$	1.05
Average Number of Shares Outstanding:
Basic			68,488				69,292				68,902				69,838
Diluted			70,909				70,878				71,717				72,066
Dividends Declared Per Common Share		$	0.13			$	0.11			$	0.37			$	0.31

See accompanying notes to condensed consolidated financial statements.

AptarGroup, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

In thousands, except per share amounts

		September 30,				December 31,
		2007				2006
Assets
Current Assets:
Cash and equivalents		$	270,073			$	170,576
Accounts and notes receivable, less allowance for doubtful accounts of $11,433 in 2007 and $10,963 in 2006			380,187				320,969
Inventories, net			263,426				226,455
Prepaid expenses and other current assets			64,280				44,820
			977,966				762,820
Property, Plant and Equipment:
Buildings and improvements			253,036				236,743
Machinery and equipment			1,365,264				1,212,386
			1,618,300				1,449,129
Less: Accumulated depreciation			(1,004,897	)			(872,241	)
			613,403				576,888
Land			15,342				14,189
			628,745				591,077
Other Assets:
Investments in affiliates			3,933				3,388
Goodwill			219,903				207,882
Intangible assets, net			18,408				19,820
Other non-current assets			5,736				7,025
			247,980				238,115
Total Assets		$	1,854,691			$	1,592,012

See accompanying notes to condensed consolidated financial statements.

AptarGroup, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

In thousands, except per share amounts

		September 30,				December 31,
		2007				2006
Liabilities and Stockholders’ Equity
Current Liabilities:
Notes payable		$	181,089			$	100,583
Current maturities of long-term obligations			25,976				26,841
Accounts payable and accrued liabilities			340,368				272,761
			547,433				400,185
Long-Term Obligations			146,545				168,877
Deferred Liabilities and Other:
Deferred income taxes			30,999				33,741
Retirement and deferred compensation plans			45,615				40,134
Deferred and other non-current liabilities			8,539				2,112
Commitments and contingencies			—				—
Minority interests			580				563
			85,733				76,550
Stockholders’ Equity:
Preferred stock, $.01 par value, 1 million shares authorized, none outstanding			—				—
Common stock, $.01 par value			790				392
Capital in excess of par value			220,565				195,343
Retained earnings			923,667				844,921
Accumulated other comprehensive income			187,751				109,505
Less treasury stock at cost, 10.8 and 9.3 million shares as of September 30, 2007 and December 31, 2006			(257,793	)			(203,761	)
			1,074,980				946,400
Total Liabilities and Stockholders’ Equity		$	1,854,691			$	1,592,012

See accompanying notes to condensed consolidated financial statements.

AptarGroup, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

In thousands, brackets denote cash outflows

Nine Months Ended September 30,		2007				2006
Cash Flows From Operating Activities:
Net income		$	105,943			$	75,721
Adjustments to reconcile net income to net cash provided by operations:
Depreciation			88,908				80,721
Amortization			3,338				2,782
Stock option based compensation			12,389				11,348
Provision for bad debts			677				1,567
Labor redeployment			(452	)			(879	)
Minority interests			4				94
Deferred income taxes			(10,151	)			(5,043	)
Retirement and deferred compensation plans			3,841				2,490
Equity in results of affiliates in excess of cash distributions received			(426	)			(371	)
Changes in balance sheet items, excluding effects from foreign currency adjustments:
Accounts receivable			(33,207	)			(27,000	)
Inventories			(21,639	)			(17,963	)
Prepaid and other current assets			(4,914	)			(1,940	)
Accounts payable and accrued liabilities			30,586				26,678
Income taxes payable			12,861				3,234
Other changes, net			(939	)			(2,974	)
Net Cash Provided by Operations			186,819				148,465
Cash Flows From Investing Activities:
Capital expenditures			(90,626	)			(81,558	)
Disposition of property and equipment			2,570				6,689
Intangible assets acquired			(976	)			(2,767	)
Acquisition of businesses, net of cash acquired			(5,151	)			(32,555	)
Collection of notes receivable, net			129				265
Net Cash Used by Investing Activities			(94,054	)			(109,926	)
Cash Flows From Financing Activities:
Proceeds from notes payable			79,713				10,441
Proceeds from long-term obligations			—				55,341
Repayments of long-term obligations			(24,408	)			(8,290	)
Dividends paid			(25,542	)			(21,683	)
Proceeds from stock options exercises			12,476				10,717
Purchase of treasury stock			(56,818	)			(44,416	)
Excess tax benefit from exercise of stock options			2,980				1,125
Net Cash (Used)/Provided by Financing Activities			(11,599	)			3,235
Effect of Exchange Rate Changes on Cash			18,331				8,835
Net Increase in Cash and Equivalents			99,497				50,609
Cash and Equivalents at Beginning of Period			170,576				117,635
Cash and Equivalents at End of Period		$	270,073			$	168,244
Supplemental Non-cash Financing Activities:
Capital lease obligations		$	—				1,780

See accompanying notes to condensed consolidated financial statements.

AptarGroup, Inc.
Notes to Condensed Consolidated Financial Statements
(Amounts in Thousands, Except per Share Amounts, or Otherwise Indicated)
(Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements include the accounts of AptarGroup, Inc. and its subsidiaries. The terms “AptarGroup” or “Company” as used herein refer to AptarGroup, Inc. and its subsidiaries.

     In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for the fair statement of consolidated financial position, results of operations, and cash flows for the interim periods presented. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures made are adequate to make the information presented not misleading. Accordingly, these unaudited consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

     Effective January 1, 2006, the Company adopted Statement of Financial Accounting Standards (“SFAS”) 123(R), “Share-Based Payment”. This statement replaces SFAS 123, “Accounting for Stock-Based Compensation” and supersedes Accounting Principles Board Opinion (“APB”) 25. SFAS 123(R) requires that all share-based compensation be recognized as an expense in the financial statements and that such cost be measured at the fair value of the award. Also under the new standard, excess tax benefits related to issuance of equity instruments under share-based payment arrangements are considered financing instead of operating cash flow activities. The Company has adopted the modified prospective method of applying SFAS 123(R), which requires the recognition of compensation expense on a prospective basis.

     Effective January 1, 2007, the Company adopted the provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 48, “Accounting for Income Tax Uncertainty in Income Taxes” (“FIN 48”). As a result of the implementation of FIN 48, the Company recognized a $1.6 million increase in the liability for income tax uncertainties. The increase was accounted for as a reduction to the January 1, 2007 balance of retained earnings, as required by FIN 48.

NOTE 2 - INVENTORIES

At September 30, 2007 and December 31, 2006, approximately 21% of the total inventories are accounted for by using the LIFO method. Inventories, by component net of reserves, consisted of:

		September 30,				December 31,
		2007				2006
Raw materials		$	94,762			$	84,470
Work in progress			64,036				49,377
Finished goods			108,673				95,403
Total			267,471				229,250
Less LIFO Reserve			(4,045	)			(2,795	)
Total		$	263,426			$	226,455

NOTE 3 – GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill since the year ended December 31, 2006 are as follows by reporting segment:

		Pharma			Beauty & Home					Closures				Total
Balance as of December 31, 2006		$	23,158			$	148,073			$	36,651			$	207,882
Acquisitions (See Note 11)			—				3,472				—				3,472
Foreign currency exchange effects			1,708				5,272				1,570				8,549
Balance as of September 30, 2007		$	24,866			$	156,817			$	38,221			$	219,903

The table below shows a summary of intangible assets as of September 30, 2007 and December 31, 2006.

						September 30, 2007												December 31, 2006
		Weighted Average				Gross												Gross
		Amortization				Carrying				Accumulated				Net				Carrying				Accumulated				Net
		Period (Years)				Amount				Amortization				Value				Amount				Amortization				Value
Amortized intangible assets:
Patents			14			$	18,723			$	(11,585	)		$	7,138			$	17,267			$	(9,750	)		$	7,517
License agreements and other			8				22,980				(11,710	)			11,270				21,196				(8,893	)			12,303
Total intangible assets						$	41,703			$	(23,295	)		$	18,408			$	38,463			$	(18,643	)		$	19,820

     Aggregate amortization expense for the intangible assets above for the quarters ended September 30, 2007 and 2006 was $1,150 and $1,125, respectively. Aggregate amortization expense for the intangible assets above for the nine months ended September 30, 2007 and September 30, 2006 was $3,338 and $2,782, respectively.

Estimated amortization expense for the years ending December 31 is as follows:

2007		$	4,474
2008			4,585
2009			3,853
2010			3,375
2011			1,931

     Future amortization expense may fluctuate depending on changes in foreign currency rates. The estimates for amortization expense noted above are based upon foreign exchange rates as of September 30, 2007.

NOTE 4 – TOTAL COMPREHENSIVE INCOME

AptarGroup’s total comprehensive income was as follows:

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net income		$	39,395			$	28,243			$	105,943			$	75,721
Add:  Foreign currency translation adjustments			53,547				(6,714	)			78,930				53,573
Net gain/(loss) on derivatives (net of tax)			35				—				(46	)			—
Pension liability adjustment (net of tax)			(703	)			—				(639	)			(19	)
Total comprehensive income		$	92,274			$	21,529			$	184,188			$	129,275

NOTE 5 – RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of Net Periodic Benefit Cost:

Three months ended September 30,

		Domestic Plans								Foreign Plans
		2007				2006				2007				2006
Service cost		$	977			$	987			$	397			$	349
Interest cost			738				661				326				351
Expected return on plan assets			(687	)			(604	)			(183	)			(147	)
Amortization of prior service cost			1				1				(23	)			18
Amortization of net loss			19				151				267				150
Net periodic benefit cost		$	1,048			$	1,196			$	784			$	721

Nine months ended September 30,

		Domestic Plans								Foreign Plans
		2007				2006				2007				2006
Service cost		$	2,901			$	2,961			$	1,165			$	1,022
Interest cost			2,248				1,983				1,145				1,033
Expected return on plan assets			(2,042	)			(1,812	)			(535	)			(432	)
Amortization of prior service cost			3				3				10				54
Amortization of net loss			199				453				519				444
Net periodic benefit cost		$	3,309			$	3,588			$	2,304			$	2,121

EMPLOYER CONTRIBUTIONS

As of September 30, 2007, the Company has contributed $2.0 million to its domestic defined benefit plans and approximately $1.2 million to its foreign plans. The Company presently anticipates contributing an additional $0.7 million to fund its foreign plans for the remainder of 2007.

NOTE 6 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company maintains a foreign exchange risk management policy designed to establish a framework to protect the value of the Company’s non-functional denominated transactions from adverse changes in exchange rates. Sales of the Company’s products can be denominated in a currency different from the currency in which the related costs to produce the product are denominated. Changes in exchange rates on such inter-country sales impact the Company’s results of operations. The Company’s policy is not to engage in speculative foreign currency hedging activities, but to minimize its net foreign currency transaction exposure defined as firm commitments and transactions recorded and denominated in currencies other than the functional currency. The Company may use foreign currency forward exchange contracts, options and cross currency swaps to hedge these risks.

     The Company maintains an interest rate risk management strategy to minimize significant, unanticipated earnings fluctuations that may arise from volatility in interest rates.

     For derivative instruments designated as hedges, the Company formally documents the nature and relationships between the hedging instruments and the hedged items, as well as the risk management objectives, strategies for undertaking the various hedge transactions, and the method of assessing hedge effectiveness. Additionally, in order to designate any derivative instrument as a hedge of an anticipated transaction, the significant characteristics and expected terms of any anticipated transaction must be specifically identified, and it must be probable that the anticipated transaction will occur.

FAIR VALUE HEDGES

The Company has an interest rate swap to convert a portion of its fixed-rate debt into variable-rate debt. Under the interest rate swap contract, the Company exchanges, at specified intervals, the difference between fixed-rate and floating-rate amounts, which is calculated based on an agreed upon notional amount.

     As of September 30, 2007, the Company recorded the fair value of the derivative instrument of $0.9 million in other non-current assets with a corresponding increase to debt related to the fixed-to-variable interest rate swap agreement with a notional principal value of $20 million. No gain or loss related to the change in fair value was recorded in the income statement for the three and nine months ended September 30, 2007 or 2006 as any hedge ineffectiveness for the period was immaterial.

CASH FLOW HEDGES

As of September 30, 2007, the Company had one foreign currency cash flow hedge. A French entity of AptarGroup, AptarGroup Holding SAS, has hedged the risk of variability in Euro equivalent associated with the cash flows of an intercompany loan granted in Brazilian Real. The forward contracts utilized were designated as a hedge of the changes in the cash flows relating to the changes in foreign currency rates relating to the loan and related forecasted interest. The notional amount of the foreign currency forward contracts utilized to hedge cash flow exposure was 6.7 million Brazilian Real ($3.7 million) as of September 30, 2007. There were no foreign currency forward contracts utilized to hedge cash flow exposures as of September 30, 2006.

     During the nine months ended September 30, 2007, the Company did not recognize any net gain (loss) as any hedge ineffectiveness for the period was immaterial, and the Company did not recognize any net gain (loss) related to the portion of the hedging instrument excluded from the assessment of hedge effectiveness. The Company’s foreign currency forward contracts hedge forecasted transactions for a maximum of five years (March 2012).

HEDGE OF NET INVESTMENTS IN FOREIGN OPERATIONS

A significant number of the Company’s operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of the Company’s foreign entities. A weakening U.S. dollar relative to foreign currencies has an additive translation effect on the Company’s financial condition and results of operations. Conversely, a strengthening U.S. dollar has a dilutive effect. The Company in some cases maintains debt in these subsidiaries to offset the net asset exposure. The Company does not otherwise actively manage this risk using derivative financial instruments. In the event the Company plans on a full or partial liquidation of any of its foreign subsidiaries where the Company’s net investment is likely to be monetized, the Company will consider hedging the currency exposure associated with such a transaction.

OTHER

As of September 30, 2007, the Company recorded the fair value of foreign currency forward exchange contracts of $1.0 million in prepaid expenses and other current assets, $0.2 million in accounts payable and accrued liabilities and $2.1 million in deferred and other non-current liabilities in the balance sheet. All forward exchange contracts outstanding as of September 30, 2007 had an aggregate contract amount of $96.4 million.

NOTE 7 – COMMITMENTS AND CONTINGENCIES

The Company, in the normal course of business, is subject to a number of lawsuits and claims both actual and potential in nature. Management believes the resolution of these claims and lawsuits will not have a material adverse or positive effect on the Company’s financial position, results of operations or cash flow.

     Under its Certificate of Incorporation, the Company has agreed to indemnify its officers and directors for certain events or occurrences while the officer or director is, or was serving, at its request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a directors and officers liability insurance policy that covers a portion of its exposure. As a result of its insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of September 30, 2007.

NOTE 8 – STOCK REPURCHASE PROGRAM

During the quarter ended September 30, 2007, the Company repurchased 545 thousand shares for an aggregate amount of $19.7 million. During the nine months ended September 30, 2007, the Company repurchased approximately 1.6 million shares for an aggregate amount of $56.8 million. As of September 30, 2007, the Company has outstanding authorizations to repurchase up to approximately 2.5 million shares. The timing of and total amount expended for the share repurchase depend upon market conditions.

NOTE 9 – EARNINGS PER SHARE

AptarGroup’s authorized common stock consists of 99 million shares, having a par value of $.01 each. Information related to the calculation of earnings per share is as follows:

		Three months ended
		September 30, 2007								September 30, 2006
		Diluted				Basic				Diluted				Basic
Consolidated operations
Income available to common stockholders		$	39,395			$	39,395			$	28,243			$	28,243
Average equivalent shares
Shares of common stock			68,488				68,488				69,292				69,292
Effect of dilutive stock based compensation
Stock options			2,415				—				1,582				—
Restricted stock			6				—				4				—
Total average equivalent shares			70,909				68,488				70,878				69,292
Net income per share		$	0.56			$	0.58			$	0.40			$	0.41

		Nine months ended
		September 30, 2007								September 30, 2006
		Diluted				Basic				Diluted				Basic
Consolidated operations
Income available to common stockholders		$	105,943			$	105,943			$	75,721			$	75,721
Average equivalent shares
Shares of common stock			68,902				68,902				69,838				69,838
Effect of dilutive stock based compensation
Stock options			2,804				—				2,222				—
Restricted stock			11				—				6				—
Total average equivalent shares			71,717				68,902				72,066				69,838
Net income per share		$	1.48			$	1.54			$	1.05			$	1.08

NOTE 10 – SEGMENT INFORMATION

The Company operates in the packaging components industry, which includes the development, manufacture and sale of consumer product dispensing systems. Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment. Operations that sell dispensing systems to the pharmaceutical market form the Pharma segment. Operations that sell closures to each market served by AptarGroup form the Closures segment.

     The accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006. The Company evaluates performance of its business segments and allocates resources based upon earnings before interest expense in excess of interest income, stock option and corporate expenses, income taxes and unusual items (collectively referred to as “Segment Income”).

Financial information regarding the Company’s reportable segments is shown below:

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Total Sales:
Beauty & Home		$	261,135			$	214,084			$	758,561			$	623,119
Closures			127,065				114,111				369,628				329,571
Pharma			100,817				79,019				290,036				235,662
Other			336				290				1,038				902
Total Sales			489,353				407,504				1,419,263				1,189,254
Less: Intersegment Sales:
Beauty & Home		$	2,522			$	1,684			$	7,804			$	7,828
Closures			546				303				1,596				833
Pharma			258				387				419				955
Other			335				225				1,035				640
Total Intersegment Sales		$	3,661			$	2,599			$	10,854			$	10,256
Net Sales:
Beauty & Home		$	258,613			$	212,400			$	750,757			$	615,291
Closures			126,519				113,808				368,032				328,738
Pharma			100,559				78,632				289,617				234,707
Other			1				65				3				262
Net Sales		$	485,692			$	404,905			$	1,408,409			$	1,178,998
Segment Income:
Beauty & Home		$	25,561			$	18,487			$	78,136			$	54,872
Closures			12,494				11,825				39,838				34,548
Pharma			29,407				21,731				78,445				58,642
Corporate Expenses & Other			(10,213	)			(7,405	)			(35,943	)			(28,079	)
Income before interest and taxes		$	57,249			$	44,638			$	160,476			$	119,983
Interest expense, net			(2,658	)			(3,467	)			(8,735	)			(9,433	)
Income before income taxes		$	54,591			$	41,171			$	151,741			$	110,550

NOTE 11 – ACQUISITIONS

On February 15, 2007 the Company acquired Moderne Verpackungssysteme GmbH (“MVS”) for approximately $5.2 million in cash. No debt was assumed in the transaction. MVS, located in Germany, is a supplier of bag-on-valve assembled products.

The excess of the purchase price over the fair valve of assets acquired and liabilities assumed was allocated to Goodwill. Goodwill of approximately $3.5 million was recorded on the acquisition. The condensed consolidated statement of income includes MVS’ results of operations from February 15, 2007, the date of the acquisition and the acquisition is included in the Beauty and Home reporting segment.

NOTE 12 – STOCK-BASED COMPENSATION

Effective January 1, 2006, the Company adopted Statement of Financial Accounting Standards (“SFAS”) 123(R), “Share-Based Payment”. This statement replaced SFAS 123, “Accounting for Stock-Based Compensation” and supersedes Accounting Principles Board Opinion (“APB”) 25. SFAS 123(R) requires that all share-based compensation be recognized as an expense in the financial statements and that such cost be measured at the fair value of the award. Also under the new standard, excess tax benefits related to issuance of equity instruments under share-based payment arrangements are considered financing instead of operating cash flow activities. The Company has adopted the modified prospective method of applying SFAS 123(R), which requires the recognition of compensation expense on a prospective basis. Accordingly, prior period financial statements have not been restated.

     SFAS 123(R) upon adoption requires the application of the non-substantive vesting approach which means that an award is fully vested when the employee’s retention of the award is no longer contingent on providing subsequent service. Under this approach, compensation costs are recognized over the requisite service period of the award instead of ratably over the vesting period stated in the grant. As such, costs would be recognized immediately, if the employee is retirement eligible on the date of grant or over the period from the date of grant until retirement eligibility if retirement eligibility is reached before the end of the vesting period stated in the grant. For awards granted prior to adoption, the Company will continue to recognize compensation costs ratably over the vesting period with accelerated recognition of the unvested portion upon actual retirement.

     The Company issues stock options and restricted stock units to employees under Stock Awards Plans approved by shareholders. Stock options are issued to non-employee directors for their services as directors under Director Stock Option Plans approved by shareholders. Options are awarded with the exercise price equal to the market price on the date of grant and generally become exercisable over three years and expire 10 years after grant. Restricted stock units generally vest over three years.

     Compensation expense recorded attributable to stock options for the first nine months of 2007 was approximately $12.4 million ($8.7 million after tax), or $0.13 per share basic and $0.12 per share diluted. Compensation expense recorded attributable to stock options for the first nine months of 2006 was approximately $11.3 million ($7.4 million after tax), or $0.11 per share basic and $0.10 per share diluted. In both years, the majority of the compensation expense was recorded in selling, research & development and administrative expenses.

     The Company uses historical data to estimate expected life and volatility. The weighted-average fair value of stock options granted under the Stock Awards Plans was $9.32 and $8.05 per share in 2007 and 2006, respectively. These values were estimated on the respective dates of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

     

Stock Awards Plans:
Nine months ended September 30,		2007				2006
Dividend Yield			1.4	%			1.6	%
Expected Stock Price Volatility			24.6	%			24.8	%
Risk-free Interest Rate			4.8	%			4.3	%
Expected Life of Option (years)			7.0				7.0

There have been no grants under the Director Stock Option Plan during 2007. The fair value of stock options granted under the Director Stock Option Plans in 2006 was $8.63 per share. These values were estimated on the respective date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

Director Stock Option Plans:
Nine months ended September 30,		2007				2006
Dividend Yield			—				1.5	%
Expected Stock Price Volatility			—				24.8	%
Risk-free Interest Rate			—				5.1	%
Expected Life of Option (years)			—				7.0

A summary of option activity under the Company’s stock option plans as of September 30, 2007, and changes during the period then ended is presented below:

		Stock Awards Plans								Director Stock Option Plans
						Weighted Average								Weighted Average
		Shares				Exercise Price				Shares				Exercise Price
Outstanding, January 1, 2007			7,327,874			$	18.70				220,000			$	20.68
Granted			1,249,500				30.49				—				—
Exercised			(765,072	)			14.51				(54,000	)			13.77
Forfeited or expired			(12,199	)			23.47				—				—
Outstanding at September 30, 2007			7,800,103			$	20.99				166,000			$	22.93
Exercisable at September 30, 2007			5,355,491			$	17.64				138,000			$	22.34
Weighted-Average Remaining Contractual Term (Years):
Outstanding at September 30, 2007			6.2								6.4
Exercisable at September 30, 2007			5.1								6.2
Aggregate Intrinsic Value ($000):
Outstanding at September 30, 2007		$	131,657							$	2,479
Exercisable at September 30, 2007		$	108,368							$	2,144
Intrinsic Value of Options Exercised ($000) During the Nine Months Ended:
September 30, 2007		$	15,274							$	1,024
September 30, 2006		$	9,938							$	36

     The fair value of shares vested during the nine months ended September 30, 2007 and 2006 was $9.5 million and $8.2 million, respectively. Cash received from option exercises was approximately $12.5 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $4.3 million in the nine months ended September 30, 2007. As of September 30, 2007, the remaining valuation of stock option awards to be expensed in future periods was $6.7 million and the related weighted-average period over which it is expected to be recognized is 1.4 years.

     The fair value of restricted stock unit grants is the market price of the underlying shares on the grant date. A summary of restricted stock unit activity as of September 30, 2007, and changes during the period then ended is presented below:

     

						Weighted-Average
		Shares				Grant-Date Fair Value
Nonvested at January 1, 2007			15,700			$	24.66
Granted			14,512				30.63
Vested			(9,114	)			23.27
Nonvested at September 30, 2007			21,098			$	29.36

     Compensation expense recorded attributable to restricted stock unit grants for the first nine months of 2007 and 2006 was approximately $400 and $200, respectively. The fair value of units vested during the nine months ended September 30, 2007 and 2006 was $212 and $409, respectively. The intrinsic value of units vested during the nine months ended September 30, 2007 and 2006 was $290 and $749, respectively. As of September 30, 2007 there was $93 of total unrecognized compensation cost relating to restricted stock unit awards which is expected to be recognized over a weighted average period of 1.5 years.

NOTE 13 – REDEPLOYMENT PROGRAM

The Company announced in the third quarter of 2005 a plan to reduce and redeploy certain personnel in its French fragrance/cosmetic operations. The objective of this plan is to better align production equipment and personnel between several sites in France to ultimately reduce costs and maintain competitiveness. This plan will be implemented in phases over a three year period and is now expected to be completed in the fourth quarter of 2007. The plan anticipates a headcount reduction by the end of 2007 of approximately 90 people. Total costs associated with the Redeployment Program are expected to be approximately $7 to $9 million before taxes over the Redeployment Program period and primarily relate to employee severance costs. The following table below highlights the pre-tax amount incurred in the period and the ending liability at the end of September 30, 2007. All charges related to the Redeployment Program are included in Cost of Sales in the condensed consolidated statement of income.

						Charges For
		Beginning Reserve				The Nine Months												Ending Reserve
		At 01/01/07				Ended 09/30/07				Cash Paid				FX Impact				At 09/30/07
Employee severance		$	995			$	646			$	(1,218	)		$	113			$	536
Other costs			—				271				(285	)			14				—
Totals		$	995			$	917			$	(1,503	)		$	127			$	536

NOTE 14 – INCOME TAX UNCERTAINTIES

The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, the Company recognized a $1.6 million increase in the liability for income tax uncertainties. This increase was accounted for as a reduction to the January 1, 2007 balance of retained earnings, as required by FIN 48. The Company’s policy is to recognize interest and penalties accrued related to unrecognized tax benefits as a component of income taxes. The total amount of accrued interest and penalties as of January 1, 2007 was $1.1 million.

     As of January 1, 2007, the total amount of unrecognized tax benefits is $7.0 million, of which $6.2 million, if recognized, would impact the effective tax rate. In the first quarter of 2007, the Company incurred unfavorable tax audit settlements of $500 thousand which were part of the January 1, 2007 unrecognized tax benefits. For the next twelve months, the Company does not anticipate material changes to its income tax uncertainties.

     The Company or its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. The major tax jurisdictions the Company files in with years still subject to income tax examinations are listed below.

		Tax Years
Tax		Subject to
Jurisdiction		Examination
United States — Federal			2003–2006
United States — States			2002–2006
France			2004–2006
Germany			2002–2006
Italy			2002–2006
Switzerland			1997–2006

NOTE 15 – STOCK SPLIT

On April 18, 2007, the Board of Directors approved a two-for-one stock split that was effected in the form of a stock distribution to shareholders of record as of the close of business on May 2, 2007 for distribution on May 9, 2007. All historical weighted average share and per share amounts were restated in this Form 10-Q to reflect the stock split.

(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS, OR OTHERWISE INDICATED)

RESULTS OF OPERATIONS

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net Sales			100.0	%			100.0	%			100.0	%			100.0	%
Cost of sales (exclusive of depreciation shown below)			68.0				67.8				67.4				67.5
Selling, research & development and administration			13.6				14.2				14.6				15.1
Depreciation and amortization			6.6				7.0				6.5				7.1
Operating Income			11.8				11.0				11.5				10.3
Other income (expense)			(0.6	)			(0.9	)			(0.7	)			(0.9	)
Income before income taxes			11.2				10.1				10.8				9.4
Net income			8.1	%			7.0	%			7.5	%			6.4	%
Effective Tax Rate			27.8	%			31.4	%			30.2	%			31.5	%

NET SALES

Net sales for the quarter and nine months ended September 30, 2007 were a record $485.7 million and $1.4 billion, respectively, and represented increases of 20% and 19%, respectively, over the same periods a year ago. The average U.S. dollar exchange rate weakened compared to the Euro in 2007 compared to 2006, and as a result, changes in exchange rates positively impacted sales and accounted for approximately 6% of sales growth for the quarter and nine months ended September 30, 2007. Sales from acquired companies accounted for approximately 1% of the increase in sales for the quarter and nine months ended September 30, 2007. The remaining sales growth was due primarily to increased demand for our innovative dispensing systems.

     For further discussion on net sales by reporting segment, please refer to the segment analysis of net sales and segment income on the following pages.

The following table sets forth, for the periods indicated, net sales by geographic location:

		Three Months Ended September 30,																Nine Months Ended September 30,
		2007				% of Total				2006				% of Total				2007				% of Total				2006				% of Total
Domestic		$	127,363				26	%		$	122,412				30	%		$	374,805				27	%		$	353,759				30	%
Europe			297,877				61	%			238,371				59	%			873,710				62	%			711,430				60	%
Other Foreign			60,452				13	%			44,122				11	%			159,894				11	%			113,809				10	%

COST OF SALES (EXCLUSIVE OF DEPRECIATION SHOWN BELOW)

Our cost of sales as a percent of net sales increased to 68.0% in the third quarter of 2007 compared to 67.8% in the third quarter of 2006.

The following factors positively impacted our cost of sales percentage in the third quarter of 2007:

Leveraging of Fixed Manufacturing Costs. The increase in sales volumes across all three market segments allowed us to better leverage our fixed overhead manufacturing expenses as a percentage of our net sales.

Favorable Product Mix. Increased sales of our products to the pharmaceutical market which traditionally generate higher margins helped positively impact our cost of sales percentage in the third quarter. In addition, the success of our bag-on-valve product line utilizing our value added accessories for continuous spray sun care products also had a positive impact on our cost of sales percentage.

Lower Compliance Costs For The Pharma Industry. In the prior year we incurred additional costs in our Pharma segment due to more stringent quality standards on certain of our products. These costs include, among others, higher personnel-related costs to assure the level of quality demanded by this market and higher scrap associated with the destruction of non-usable components. A majority of these costs did not reoccur in 2007 and as a result had a positive impact on our cost of sales percentage in the first nine months of 2007.

The following factors negatively impacted our cost of sales percentage in the third quarter of 2007:

Rising Raw Material Costs. Raw material costs, in particular nickel and plastic resin, were higher in the third quarter of 2007 over 2006.

Weakening of the U.S. Dollar. We are a net importer from Europe into the U.S. and other countries of products produced in Europe with costs denominated in Euros. As a result, when the U.S. dollar or other currencies weaken against the Euro, products produced in Europe (with costs denominated in Euros) and sold in currencies that are weaker compared to the Euro, have a negative impact on cost of sales as a percentage of net sales.

Our cost of sales as a percent of net sales decreased slightly to 67.4% for the first nine months compared to 67.5% in the first nine months of 2006. The decrease is primarily due to the same factors mentioned above.

SELLING, RESEARCH & DEVELOPMENT AND ADMINISTRATIVE

Our Selling, Research & Development and Administrative expenses (“SG&A”) increased by approximately $8.4 million in the third quarter of 2007 compared to the same period a year ago. Changes in currency rates accounted for approximately $2.9 million of the increase in SG&A in the quarter while acquisitions accounted for approximately $0.5 million of the increase in SG&A in the quarter. The remainder of the increase is due primarily to normal inflationary cost increases. SG&A as a percentage of net sales decreased to 13.6% compared to 14.2% of net sales in the same period of the prior year primarily due to the leveraging of higher sales volumes.

          SG&A increased by approximately $27.4 million for the nine months ended September 30, 2007 compared to the same period a year ago. Changes in currency rates accounted for approximately $8.8 million of the increase in SG&A while acquisitions accounted for approximately $2.2 million of the increase in SG&A in the first nine months. Another $0.9 million of the increase relates to an increase of stock option expense which occurred substantially in the first quarter of 2007. The remainder of the increase is due primarily to normal inflationary cost increases. SG&A as a percentage of net sales decreased to 14.6% compared to 15.1% of net sales in the same period of the prior year primarily due to the leveraging of higher sales volumes.

DEPRECIATION AND AMORTIZATION

Depreciation and amortization increased approximately $3.7 million in the third quarter of 2007 to $32.1 million compared to $28.3 million in the third quarter of 2006. Acquisitions accounted for approximately $0.3 million of additional depreciation and amortization expense in the quarter while changes in foreign currency rates accounted for another $1.6 million of the increase. Depreciation and amortization as a percentage of sales decreased to 6.6% of net sales for the third quarter of 2007 compared to 7.0% in the same period of the prior year.

               Depreciation and amortization increased approximately $8.7 million in the first nine months of 2007 to $92.2 million compared to $83.5 million for the first nine months of 2006. Acquisitions accounted for approximately $1.1 million of additional depreciation and amortization expense compared to the prior year. Changes in foreign currency rates accounted for another $4.7 million of the increase. Depreciation and amortization as a percentage of sales decreased to 6.5% of net sales for the nine months ended September 30, 2007 compared to 7.1% in the same period of the prior year.

OPERATING INCOME

Operating income increased approximately $12.8 million in the third quarter of 2007 to $57.4 million compared to $44.6 million in the same period in the prior year. The increase is primarily due to the increase in sales and favorable product mix mentioned above. Operating income as a percentage of net sales increased to 11.8% in the third quarter of 2007 compared to 11.0% for the same period in the prior year.

          Operating income increased approximately $40.8 million in the first nine months of 2007 to $161.6 million compared to $120.8 million in the same period in the prior year. Increases in sales volumes are the primary reason for the overall net increase in operating income for the first nine months of the year. Acquisitions added approximately $1.9 million to operating income in the first half of the year. Operating income as a percentage of sales increased to 11.5% in the first nine months of 2007 compared to 10.3% for the same period in the prior year.

NET OTHER EXPENSE

Net other expenses in the third quarter of 2007 decreased to $2.8 million from $3.5 million in the same period in the prior year primarily reflecting increased interest income of $1.2 million. The increase in interest income is due primarily to higher average cash on the balance sheet.

     Net other expenses for the nine months ended September 30, 2007 decreased slightly to $9.8 million from $10.3 million in the same period in the prior year primarily reflecting increased interest income of $2.8 million offset partially by an increase in interest expense of $2.1 million. The increase in interest income is due primarily to higher average cash balances while the increase in interest expense is due primarily to higher average interest rates and higher borrowing levels.

EFFECTIVE TAX RATE

The reported effective tax rate decreased to 27.8% for the three months ended September 30, 2007 compared to 31.4% in the third quarter of 2006. The decrease in effective tax rate in the third quarter of 2007 is due primarily to a positive tax benefit in the

quarter related to tax law changes in Germany. During the third quarter of 2007, the German government approved a reduction in the income tax rate effective January 1, 2008. This tax law change reduced the Company’s net deferred tax liability by approximately $2.3 million , or approximately $0.03 per share.

     The reported effective tax rate decreased slightly to 30.2% for the nine months ended September 30, 2007 compared to 31.5% in the first nine months of the prior year primarily due to the positive effect of the German tax law change recorded in the third quarter of 2007.

NET INCOME

We reported net income of $39.4 million and $105.9 million in the third quarter and nine months ended September 30, 2007, respectively, compared to $28.2 million and $75.7 million for the same periods in the prior year.

BEAUTY & HOME SEGMENT

Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment.

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net Sales		$	258,613			$	212,400			$	750,757			$	615,291
Segment Income (1)			25,561				18,487				78,136				54,872
Segment Income as a percentage of Net Sales			9.9	%			8.7	%			10.4	%			8.9	%

     Net sales for the quarter ended September 30, 2007 increased 22% in the third quarter of 2007 to $258.6 million compared to $212.4 million in the third quarter of the prior year. Acquisitions accounted for approximately $1.2 million or 1% of the sales increase. Changes in exchange rates positively impacted sales by approximately 6% during the quarter. Sales to the personal care market excluding changes in currency and acquisitions increased approximately 23% in the third quarter of 2007 compared to the same period in the prior year, reflecting increased demand for our aerosol valve products in Europe as well as our new and innovative bag-on-valve and accessory products in North America. Sales to the fragrance/cosmetic market excluding changes in currency and acquisitions were strong in the quarter, growing 9% compared to the third quarter of 2006, reflecting the success of our new sampling devices and strong demand for our pumps.

     Net sales for the first nine months of 2007 increased 22% in the first nine months of 2007 to $750.8 million compared to $615.3 million in the first nine months of the prior year. The weakening U.S. dollar compared to the Euro positively impacted sales and represented approximately 6% of the 22% increase in sales. Acquisitions accounted for approximately 1% of the sales increase. Sales to the personal care and fragrance/cosmetic market excluding foreign currency changes and acquisitions increased approximately 22% and 11%, respectively, in the first nine months of 2007 compared to the same period in the prior year primarily for the reasons mentioned above.

     Segment Income in the third quarter of 2007 increased approximately 38% to $25.6 million compared to $18.5 million reported in the same period in the prior year. Acquisitions did not materially impact segment income in the quarter. The increase in segment income is due primarily to the increase in sales to the personal care and fragrance/cosmetic market as well as a favorable mix of products sold.

     Segment Income in the first nine months of 2007 increased approximately 42% to $78.1 million compared to $54.9 million reported in the same period in the prior year. Acquisitions accounted had an immaterial impact on segment income in the first nine months. The increase is primarily due to the same reasons mentioned above.

CLOSURES SEGMENT

The Closures segment designs and manufactures primarily dispensing closures. These products are sold primarily to the personal care, household and food/beverage markets.

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net Sales		$	126,519			$	113,808			$	368,032			$	328,738
Segment Income			12,494				11,825				39,838				34,548
Segment Income as a percentage of Net Sales			9.9	%			10.4	%			10.8	%			10.5	%

     Net sales for the quarter ended September 30, 2007 increased approximately 11% in the third quarter of 2007 to $126.5 million compared to $113.8 million in the third quarter of the prior year. Acquisitions accounted for approximately $1.4 million or 1% of the sales increase. Changes in exchange rates positively impacted sales by approximately 5% during the quarter. Sales excluding changes in foreign currency and acquisitions to the personal care market increased approximately 7% in the third quarter compared to the same period in the prior year, while sales to the food/beverage market increased 16% and sales to the household market decreased 3%. Geographically, sales to North American customers in the third quarter were down compared to the prior year third quarter primarily in the personal care and household markets.

     Net sales for the first nine months of 2007 increased approximately 12% to $368.0 million compared to $328.7 million in the first nine months of the prior year. Once again, the weakening U.S. dollar compared to the Euro positively impacted sales and represented approximately 4% of the 12% increase. Acquisitions accounted for approximately $6.8 million or 2% of the sales increase. Sales to the personal care, food and household markets excluding foreign currency and acquisitions increased approximately 7% in the first nine months of 2007 compared to the same period in the prior year.

     Segment Income in the third quarter of 2007 increased approximately 6% to $12.5 million compared to $11.8 million reported in the same period in the prior year. The increase in segment income is primarily derived from increased sales volumes in Europe during the quarter, partially offset by rising resin costs. Acquisitions had an immaterial impact on segment income in the third quarter.

     Segment Income in the first nine months of 2007 increased approximately 15% to $39.8 million compared to $34.5 million reported in the same period of the prior year. The increase in segment income is primarily derived from increased sales volumes in the first nine months in Europe. Acquisitions had an immaterial impact on segment income in the first nine months of 2007.

PHARMACEUTICAL SEGMENT

Operations that sell dispensing systems to the pharmaceutical market form the Pharma segment.

		Three Months Ended September 30,								Nine Months Ended September 30,
		2007				2006				2007				2006
Net Sales		$	100,559			$	78,632			$	289,617			$	234,707
Segment Income			29,407				21,731				78,445				58,642
Segment Income as a percentage of Net Sales			29.2	%			27.6	%			27.1	%			25.0	%