LAKE FOREST, Ill., Apr 18, 2005 (BUSINESS WIRE) -- Packaging Corporation of America (NYSE:PKG) today
reported first quarter 2005 net income of $13 million, or $0.12 per
share, compared to a first quarter 2004 net loss of $7 million, or
$0.06 per share. Net sales for the first quarter were $489 million, up
13%, compared to $431 million in the first quarter of 2004.
The increase in earnings, compared to last year's first quarter,
was driven primarily by higher pricing and sales volume for both
containerboard and corrugated products, which together improved
earnings by $0.26 cents per share. These earnings improvement items
were partially offset by higher fiber, energy, transportation, labor
and medical costs.
PCA's corrugated products shipments per workday were up 5.7%
compared to last year's first quarter. Containerboard production was
565,000 tons, up 3.4% from last year's first quarter. At quarter-end,
cash on-hand was $180 million, and long-term debt was $695 million at
an average interest expense rate of 4.6%.
Paul T. Stecko, Chairman and CEO of PCA, said, "Operationally, we
had a solid first quarter with earnings up $0.18 per share over the
first quarter of 2004. Our corrugated products volume remained very
strong with 5.7% growth over last year's record first quarter. Mill
production was very good despite some problems early in the quarter,
and our mills started up and ran extremely well after completing their
annual maintenance outages. We were also able to maintain our
containerboard inventory levels as higher mill production kept pace
with our corrugated products growth. Cost escalation remains a
problem, particularly with transportation and other fuel-related
expenses, which were a little higher than we expected entering the
first quarter."
"Looking forward to the second quarter", Mr. Stecko added, "we
currently expect to see the normal seasonal pickup in sales volume and
mix, and also anticipate some improvement in containerboard and
corrugated products pricing from previously announced price increases.
Our Tomahawk, WI medium mill will be down for its annual maintenance
outage, and we will continue to experience higher costs for certain
fuel-related operating expenses. On April 12, 2005, Southern Timber
Venture, a joint venture in which PCA holds a 31 1/3 % ownership
interest, declared a special dividend related to the sale of some of
its woodlands holdings. This dividend will contribute about $0.06 per
share to our second quarter earnings. Considering all of these items,
we currently expect second quarter earnings of about $0.28 to $0.30
per share.
PCA is the sixth largest producer of containerboard and corrugated
packaging products in the United States with sales of $1.9 billion in
2004. PCA operates four paper mills and 66 corrugated product plants
in 26 states across the country.
Conference Call Information:
WHAT: Packaging Corporation of America
1st Quarter 2005 Earnings Conference Call
WHEN: Tuesday, April 19, 2005
10:00 a.m. Eastern Time
NUMBER: (866) 244-4526 (U.S. and Canada) and
(703) 639-1172 (International)
Dial in by 9:45 a.m. Eastern Time
Conference Call Leader: Mr. Paul Stecko
WEBCAST: http://www.packagingcorp.com
REBROADCAST DATES: April 19, 2005 1:00 p.m. Eastern Time through
May 4, 2005 1:00 a.m. Eastern Time
REBROADCAST NUMBER: (888) 266-2081 (U.S. and Canada), or
(703) 925-2533 (International)
Passcode: 574495
Some of the statements in this press release are forward-looking
statements. Forward-looking statements include statements about our
future financial condition, our industry and our business strategy.
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
the exhibit "Risk Factors" in PCA's 2004 Annual Report on Form 10-K
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 March 31,
----------------------------
(in millions, except per share data) 2005 2004
-------------- -------------
Net sales $489.4 $431.2
Cost of sales (416.1) (390.6)
-------------- -------------
Gross profit 73.3 40.6
Selling and administrative expenses (35.3) (32.2)
Other income (expense), net 1.1 (1.3)
Corporate overhead (11.6) (10.3)
-------------- -------------
Income (loss) before interest and
taxes 27.5 (3.2)
Interest expense, net (7.0) (7.4)
-------------- -------------
Income (loss) before taxes 20.5 (10.6)
(Provision) benefit for income taxes (7.9) 4.0
-------------- -------------
Net income (loss) $12.6 $(6.6)
============== =============
Earnings per share:
Basic earnings (loss) per share $0.12 $(0.06)
============== =============
Diluted earnings (loss) per share $0.12 $(0.06)
============== =============
Basic common shares outstanding 107.0 105.8
Diluted common shares outstanding 108.1 105.8
Supplemental financial information:
Capital spending $36.9 $29.2
Long term debt $694.9 $694.6
Cash balance $180.2 $90.3
SOURCE: Packaging Corporation of America
Packaging Corporation of America
Barbara Sessions (Investor Relations), 877-454-2509
PCA's Website: www.packagingcorp.com
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