MANAGEMENT’S DISCUSSION AND ANALYSIS Years ended December 31, 2011 and 2010 (Tabular amounts in millions of Canadian dollars, except per share data) A number of CCL’s customers, suppliers and peers in Europe and North America had a successful 2011, but most reported signs of some softness in the fourth quarter, particularly in Europe. Sales improvement in 2012 is not anticipated to be in excess of global GDP growth rates. The emerging markets of Latin America, Eastern Europe and Asia continued to be a success factor for the Company in 2011, and along with the Company’s venture in the Middle East, are expected to continue growing at higher rates in 2012 compared to the Company’s other regions. Emerging market sales are now over 20% of the Company’s revenue base. Although the global economic environment remains uncertain and the outcome of the European sovereign debt crisis is unclear for 2012, the Company remains resolute in its growth strategy. The Label Segment announced new capacity investments in Brazil and Thailand of $20 million and $10 million, respectively, to meet regional demands. Furthermore, CCL is committed to expanding its global presence in the Wine and Spirits sector. The Container Segment recorded a significant rebound in operating results for 2011, driven by strong performance at the U.S. and Mexican operations but highlighted by a major turnaround in the Canadian facility. Market share gains are expected in the Mexican operations, while the U.S. and Canadian operations will maintain pricing discipline, and continue to drive cost reduction and productivity initiatives for the Segment to drive its momentum on into 2012. The Tube Segment had a stellar year in 2011 posting record operating results. Additional capacity is slated for the Wilkes-Barre facility and new decorating equipment for Los Angeles in order to expand market share in highly decorated tubes for the premium personal care and cosmetic sector. The immediate outlook for the first quarter of 2012 is supported by a good order book at year end and solid intake during the first weeks of the new year. However, the Company expects the rate of comparative performance improvement for the first quarter of 2012 to narrow significantly from Q4 2011 levels due to the strong results in the corresponding prior year period. At exchange rates prevailing in January 2012, the foreign currency translation impact would be insignificant. 40 CCL Industries Inc. 2011 Annual Report