LAKE FOREST, Ill.--(BUSINESS WIRE)--Oct. 17, 2007--Packaging
Corporation of America (NYSE: PKG) today reported record third quarter
2007 net income of $49 million, or $0.46 per share, compared to third
quarter 2006 net income of $44 million, or $0.42 per share, and second
quarter 2007 net income of $46 million, or $0.44 per share. Third
quarter net sales were $591 million, up 2.8% compared to $575 million
in the third quarter of 2006.
Net income for the first nine months of 2007 was $126 million, or
$1.20 per share, compared to $87 million, or $0.83 per share in 2006.
Net sales for the first nine months of 2007 were $1.74 billion
compared to $1.63 billion in the first nine months of 2006.
In a separate release, PCA also reported today that it intends to
increase the quarterly dividend on its common stock from an annual
payout of $1.00 per share to $1.20 per share, and repurchase up to
$150 million of its common stock over the next eighteen months.
The $0.04 per share increase in earnings, compared to the third
quarter of 2006, was driven primarily by higher pricing and volume of
$0.08 per share. This improvement was partially offset by higher
recycled fiber and labor and benefits costs, which totaled $0.04 per
share.
PCA's containerboard production was 632,000 tons, up 11,000 tons
or 1.8% from last year's third quarter. Outside sales of
containerboard were up about 12,000 tons and total corrugated products
shipments were up 1.3%, or about 7,000 tons, compared to last year's
third quarter. Containerboard inventories ended the quarter almost
3,500 tons below 2006 year-end levels.
Paul T. Stecko, Chairman and CEO of PCA, said, "We had another
quarter of record earnings and solid operations, driven by strong
sales volumes and outstanding operations in both our mills and box
plants. Our $40 per ton containerboard price increase was implemented
in August, and we began the implementation of our announced box price
increase in September."
Commenting on today's announced dividend increase and share
repurchase plan, Mr. Stecko noted, "These actions reflect both our
commitment to return value to our shareholders and the operating and
financial strength of the company."
"Looking ahead", Mr. Stecko added, "we expect earnings to improve
from higher box prices in the fourth quarter. This will be partially
offset by seasonally lower volume, higher fiber costs, and higher
energy costs associated with colder weather. Considering all of these
items, fourth quarter earnings are expected to be about $0.49 to $0.50
per share."
PCA is the sixth largest producer of containerboard and corrugated
packaging products in the United States with sales of $2.2 billion in
2006. PCA operates four paper mills and 67 corrugated product plants
in 26 states across the country.
Conference Call Information:
WHAT: Packaging Corporation of America
3rd Quarter 2007 Earnings Conference Call
WHEN: Thursday, October 18, 2007
10:00 a.m. Eastern Time
NUMBER: (866) 836-4700 (U.S. and Canada) or
(703) 639-1416 (International)
Dial in by 9:45 a.m. Eastern Time
Conference Call Leader: Mr. Paul Stecko
WEBCAST: http://www.packagingcorp.com
REBROADCAST DATES: October 18, 2007 1:00 p.m. Eastern Time through
November 2, 2007 11:59 p.m. Eastern Time
REBROADCAST NUMBER: (888) 266-2081 (U.S. and Canada) or
(703) 925-2533 (International)
Passcode: 1152010
Some of the statements in this press release are forward-looking
statements. Forward-looking statements include statements about our
future earnings and financial condition, our industry, our business
strategy, our future dividend policy and the timing and amount of
share repurchases. Statements that contain words such as " will",
"should", "anticipate", "believe", "expect", "intend", "estimate",
"hope" or similar expressions, are forward-looking statements. These
forward-looking statements are based on the current expectations of
PCA. Because forward-looking statements involve inherent risks and
uncertainties, the plans, actions and actual results of PCA could
differ materially. Among the factors that could cause plans, actions
and results to differ materially from PCA's current expectations
include the following: the impact of general economic conditions;
containerboard and corrugated products general industry conditions,
including competition, product demand and product pricing;
fluctuations in wood fiber and recycled fiber costs; fluctuations in
purchased energy costs; and legislative or regulatory requirements,
particularly concerning environmental matters, as well as those
identified under Item 1A. Risk Factors in PCA's Annual Report on Form
10-K for the year ended December 31, 2006 filed with the Securities
and Exchange Commission and available at the SEC's website at
"www.sec.gov".
Packaging Corporation of America
Consolidated Earnings Results
Unaudited
Three Months Ended
September 30,
-------------------
(in millions, except per share data) 2007 2006
--------- ---------
Net sales $591.0 $575.0
Cost of sales (451.4) (440.5)
--------- ---------
Gross profit 139.6 134.5
Selling and administrative expenses (42.0) (41.0)
Corporate overhead (14.0) (14.0)
Other expense, net (2.1) (2.9)
--------- ---------
Income before interest and taxes 81.5 76.6
Interest expense, net (5.7) (7.9)
--------- ---------
Income before taxes 75.8 68.7
Provision for income taxes (27.1) (25.1)
--------- ---------
Net income $48.7 $43.6
========= =========
Earnings per share:
Basic $0.46 $0.42
========= =========
Diluted $0.46 $0.42
========= =========
Basic common shares outstanding 104.6 103.7
Diluted common shares outstanding 105.6 104.6
Supplemental financial information:
Capital spending $26.9 $14.8
Long term debt 677.2 686.8
Cash balance 194.1 118.2
Packaging Corporation of America
Consolidated Earnings Results
Unaudited
Nine Months Ended
September 30,
-------------------
(in millions, except per share data) 2007 2006
--------- ---------
Net sales $1,735.8 $1,634.0
Cost of sales (1,343.2) (1,311.0)
--------- ---------
Gross profit 392.6 323.0
Selling and administrative expenses (126.8) (118.2)
Corporate overhead (41.6) (37.6)
Other expense, net (5.8) (7.6)
--------- ---------
Income before interest and taxes 218.4 159.6
Interest expense, net (19.8) (24.1)
--------- ---------
Income before taxes 198.6 135.5
Provision for income taxes (72.5) (48.9)
--------- ---------
Net income $126.1 $86.6
========= =========
Earnings per share:
Basic $1.21 $0.84
========= =========
Diluted $1.20 $0.83
========= =========
Basic common shares outstanding 104.5 103.5
Diluted common shares outstanding 105.4 104.4
Supplemental financial information:
Capital spending $68.8 $55.4
CONTACT:
Packaging Corporation of America
Barbara Sessions
Investor Relations: (877) 454-2509
PCA's Website: www.packagingcorp.com
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