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In an October 28 release, pre-tax earnings from the company's business segments increased 43 percent to $204 million from $143 million in the third quarter of 2008.
"We posted strong third quarter results by continuing to advance our transformation strategies to create a stronger, more competitive global packaging company," said John A. Luke, Jr., chairman and CEO. "Even as we navigate through one of the most severe recessions in decades, our financial strength and flexibility have allowed us to continue to invest in the right development and growth opportunities for our business. This reliability continues to be rewarded by our consumer products customers, and has solidified our position as a global packaging company."
The company's Consumer & Office Products business benefited from a solid back-to-school season in North America, and its Specialty Chemicals business increased both sales and profits by focusing on products in several global markets. Overhead cost reductions and improved operating productivity also contributed to profit growth in these businesses during the third quarter of 2009.
"We are making solid gains in each of our businesses by reshaping our market participation, reducing overhead and operating costs, and improving productivity at our facilities," concluded Luke. "Along with our financial position, these strategies are helping us perform in this low demand environment, and importantly, will position us to outperform in a recovering economy."
Third quarter 2009 net income from continuing operations was $128 million, or $0.74 per share, compared to $46 million, or $0.26 per share, in the third quarter of 2008. The results for the third quarter of 2009 include after-tax items totaling $42 million, or $0.24 per share. These items include after-tax income of $64 million, or $0.37 per share, from alternative fuel tax credits; after-tax restructuring charges of $28 million, or $0.16 per share; after-tax income of $13 million, or $0.07 per share, from vacation accrual adjustments due to a policy change; an after-tax net charge of $11 million, or $0.06 per share, from early retirement of debt; and an after-tax gain of $4 million, or $0.02 per share, from a pension curtailment.
In the Packaging Resources business, profit from continuing operations increased 16 percent to $74 million in the third quarter of 2009 compared to $64 million in the third quarter of 2008. Sales were $627 million in the third quarter of 2009 compared to $730 million in the third quarter of 2008. This segment improved product pricing and mix, generated operational productivity, and benefited from lower input costs compared to last year. Bleached paperboard (SBS) volumes were 19 percent lower compared to historically high shipments recorded in third quarter 2008, but increased 3 percent versus the second quarter of 2009 with gains in global tobacco and commercial print markets. Coated Natural Kraft (CNK) shipments declined 10 percent compared to the prior year. Market share gains in global food packaging were more than offset by lower global shipments to beverage customers as they continue to tightly manage inventory levels. Earnings in Rigesa, the segment's Brazilian operation, increased modestly on a constant currency basis as improved productivity more than offset lower volumes and pricing.
((Comments on this story may be sent to newsdesk@closeupmedia.com))
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