DOW JONES NEWSWIRES
Bemis Co.'s (BMS) first-quarter earnings surged 66%, though
missed expectations, as the food-and-beverage packaging company's
$1.2 billion acquisition of Alcan Packaging Food Americas last
March boosted its top line.
The company lowered its projected 2011 earnings view to $2.15 to
$2.30 a share from $2.33 to $2.48. In addition, Bemis predicted a
second-quarter profit of 48 cents to 54 cents, below analysts' most
recent view of 62 cents.
"Increasing raw material costs have created a challenging
environment for our flexible packaging business," President and
Chief Executive Henry Theisen said, adding that increases for
specialty resins were more dramatic than the company had
anticipated.
Package and container makers have been reporting mixed results
of late. Packaging Corp. of America's (PKG) first-quarter earnings
almost doubled on higher pricing and volume, but Sealed Air Corp.'s
(SEE) profit slipped 2.5% despite higher-than-expected sales as
growing raw materials prices added to costs.
Packaging makers that serve the food industry, such as Bemis,
fared better than those geared to other sectors during the
recession, as consumers ate more meals at home.
Bemis reported a profit of $51.2 million, or 47 cents a share,
up from $30.8 million, or 27 cents a share, a year earlier.
Prior-year earnings included 21 cents of charges related to the
Alcan acquisition from Rio Tinto PLC (RIO, RIO.LN). In February,
the company projected earnings of 50 cents to 55 cents.
Revenue increased 30% to $1.32 billion, with the Alcan
acquisition adding an estimated 19% and currency effects adding 2%.
Analysts polled by Thomson Reuters most recently estimated $1.28
billion.
Gross margin narrowed to 17.4% from 18.2%.
Net sales jumped 34% at its flexible-packaging unit, its largest
top-line contributor, as earnings increased 24% on the
acquisition.
Shares closed at $32.16 Wednesday and were inactive premarket.
The stock has dropped 1.5% this year.
-By Ian Thomson, Dow Jones Newswires; 212-416-2314;
ian.thomson@dowjones.com