Financial Reports & Markets
Sonoco reports Q3 sales up over last year
By P&PC Staff
By P&PC Staff
October 23, 2018 – Sonoco has reported its third-quarter sales are up three per cent from 2017 in the financial results for its third quarter, ending September 30, 2018.
Third-quarter 2018 net sales were $1.36 billion, up three per cent from $1.32 billion in 2017. Cash flow from operations was $451.5 million in the first nine months of 2018, compared with $281.0 million in 2017. Year-to-date free cash flow was $218.9 million, compared with $25.6 million in 2017.
On October 1, 2018, Sonoco acquired the remaining 70 per cent interest in the Conitex Sonoco joint venture and a composite can operation in Spain from Texpack, Inc., for approximately $143 million in cash. Conitex Sonoco is a manufacturer of paper-based cones and tubes used in the textile industry.
Third-quarter 2018 GAAP earnings per diluted share were $0.72, compared with $0.72 in 2017. Third-quarter 2018 GAAP earnings included after-tax restructuring and asset impairment charges of $15 million related to exiting a packaging center contract, plant closures and non-base tax-related gains. In the third quarter of 2017, GAAP results included $3.8 million, after tax, in acquisition-related expenses and non-base tax-related charges.
Base net income attributable to Sonoco (base earnings) for third quarter 2018 was $0.86 per diluted share, compared with $0.76 in 2017. Sonoco previously provided third-quarter 2018 base earnings guidance of $0.82 to $0.88 per diluted share.
Full-year 2018 base earnings guidance has been updated to $3.28 to $3.34 per diluted share. Fourth-quarter and full-year guidance reflects Sonoco’s year-over-year results, despite additional impact from Hurricane Florence, expenses from tariffs on steel, aluminum and other products, along with higher than previously expected resin, freight and other non-material inflation.
As previously reported, Sonoco’s paper mill operations in Hartsville, S.C., were temporarily shut down following unprecedented flooding from Hurricane Florence. The storm impact also temporarily idled operations at several recycling operations, tube and core plants and other operations in Virginia, North Carolina and South Carolina.
All operations impacted by Hurricane Florence are back in production. Mill operations in Hartsville lost approximately 22,300 tons of uncoated recycled paperboard and corrugated medium paper production during the storm outage in the third quarter.
“Up to 350 restoration contractors worked alongside our nearly 500 mill associates and maintenance crews to perform the largest cleanup, restoration and repair operation in our nearly 120-year history,” says Rob Tiede, president and chief executive officer. “Through their dedication, we were able to minimize the impact and bring back most production well in advance of our original expectations.”