Q1 2002 Reports a Mixed Bag for Some of Converting Sector in Manufacturing

CHICAGO, IL, USA—A number of companies have issued reports on 2002 first-quarter earnings.

Pactiv Corp., Lake Forest, IL, announced earnings per share of 26 cents from continuing operations, an increase of 44% from 18 cents/share last year. Net income from continuing operations of $42 million rose 45% from $29 million last year.

Rayonier Inc., Jacksonville, FL, reported Q1 net income of $9.4 million, or 33 cents/share. This is compared to $7.9 million, or 28 cents/share, in Q4 2001,and $12.3 million, or 45 cents/share, in Q1 2001. Sales of $276 million were up $9 million from Q4 2001 and comparable to Q1 2001.

Sappi Ltd., Johannesburg, South Africa, reports it generated cash flow (EBITDA) for the first quarter of US$148 million. Capital expenditure continued to be below depreciation and amounted to US$67 million. Executive chairman Eugene van As notes that difficult conditions were partly offset by the "geographic spread of our assets as both Europe and South Africa continued to perform well despite challenging trading conditions in their markets, this offsetting some of the difficulties in North America." Those difficulties included the continuing impact of September 11.

Stora Enso, Helsinki, Finland, reports operating profit for Q1 2002 was euro 274 million (vs euro 286.8 million in Q4 2001), equal to 8.5% of sales. Earnings per share were euro 18 cents (vs euro 22 cents in Q4 2001), and cash earnings per share were euro 55 cents (vs euro 58 cents in Q4 2001).

Smurfit-Stone Container Corp., Chicago, IL, reported net income available to common shareholders of $6 million, or 2 cents/diluted share, for Q1 2002. The results include a pretax restructuring charge of $7 million, or 2 cents/diluted share, related to facility closures. The co. earned $12 million, or 5 cents/diluted share in Q1 2001. Sales for Q1 2002 were $1.9 billion compared to $2.2 billion in Q1 2001. Earnings for 2001 included goodwill amortization of $23 million, or 9 cents/diluted share. Goodwill amortization was eliminated effective January 1, 2002, when the co. adopted Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets."

CFC Intl., Chicago Hts, IL, announced Q1 2002 net income increased 195% to $465,000 or 10 cents/share on a fully dilated basis, compared to $158,000, or 3 cents/share in Q1 2001.

Graphic Packaging Intl. Corp., Golden, CO, had Q1 net income attributable to common shareholders of $2.4 million (8 cents/diluted share) on sales of $263.7 million, compared with net income in Q4 2001 of $1.5 million (5 cents/diluted share) on sales of $270 million. Q1 2002 excludes an after-tax, non-cash extraordinary charge of $9.6 million, resulting from the co.’s recent refinancing; and Q4 2001 excludes one-time plant closure costs and amortization of goodwill (no longer applicable in 2002) totaling $6.6 million, net of tax.

MeadWestvaco Corp., Stamford, CT, reported a net loss of $63 million or 37 cents/share, which includes 20 cents/share of restructuring and other merger-related costs Excluding restructuring and other merger-related costs, the first quarter would be a net loss of $30 million, or 17 cents/share. Net sales were $1.46 billion in Q1 2002. Market-related downtime lowered profitability by 13 cents/share. The co. says these Q1 results are based on three months of operations for Westvaco Corp. and two months for The Mead Corp.

Mail-Well Inc., Englewood, CO, says pro forma results for continuing operations before restructuring and other charges were 3 cents/share on sales of $392 million during Q1 2002, compared to 9 cents/share on sales of $433 million for the same period last year. The corresponding results for the "new" Mail-Well, which exclude the results of assets held for sale, were 2 cents/share on $365 million of sales for Q1 2002, compared to 6 cents/share on $411 million of sales for the same period last year. Including restructuring and other charges, continuing operations lost $8.3 million in the quarter, or 17 cents/share.



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