Packaging Corp 3rd-qtr profit up on pricing
Wed Oct 17, 2007 5:37pm EDT
(Updates with more figures, outlook, CEO quotes, dividend, stock buyback)
NEW YORK, Oct 17 (Reuters) - Packaging Corp of America (PKG.N: Quote, Profile, Research), one of North America's largest makers of paper-based packaging, said on Wednesday its third-quarter profit rose as higher pricing and volume offset increased fiber and labor costs.
Net income was $49 million, or 46 cents per share, compared with $44 million, or 42 cents per share, a year ago, the Lake Forest, Illinois-based company said. Sales rose 2.8 percent to $591 million.
Analysts, on average, looked for earnings of 46 cents per share and sales of $585.57 million, according to Reuters Estimates.
Chairman and Chief Executive Officer Paul Stecko noted that earnings were driven by strong sales volumes and a $40-per-ton containerboard price increase in August and box price increases in September.
"Looking ahead we expect earnings to improve from higher box prices in the fourth quarter," he said. "This will be partially offset by seasonally lower volume, higher fiber costs, and higher energy costs associated with colder weather."
Stecko said Packaging Corp expected fourth-quarter earnings to be about 49 cents to 50 cents per share. Analysts currently expect 43 cents per share.
Packaging Corp, which operates four paper mills and 67 corrugated product plants in the United States, said its board authorized the repurchase of up to $150 million of the company's outstanding common stock
The company also said it intends to increase the quarterly cash dividend from an annual payout of $1.00 per share to $1.20 per share. The first quarterly dividend of 30 cents per share will be paid on Jan. 15, 2008 to shareholders of record on Dec. 14, 2007.
(Reporting by Euan Rocha)
((Editing by Jeffrey Benkoe; [email protected]; 1 646 223 6026; editing by Deborah Cohen)) Keywords: PACKAGINGCORP RESULTS/
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