Sonoco has reported net sales of $1.30bn for the first quarter of 2018, an increase of 11.2%, compared to $1.17bn from the last year’s quarter.
Gross profits for the period stood at $250.6m, an increase of 12.4%, compared to $223m for the same period last year. As a percentage of sales, gross profit increased to 19.2%, compared to 19% for the same period, last year.
The company stated that increase in gross profit percentage was because of manufacturing and procurement productivity which resulted in offsetting higher raw material and other operating costs.
Net income attributable to the company for the Q1 was $74.1m or $0.73 per diluted share, compared to $53.7m, or $0.53 per diluted share, for the same period for last year.
Sonoco president and CEO Rob Tiede said: “First-quarter GAAP and base operating profit benefitted from a positive price/cost relationship and improvements to productivity, which were partially offset by a negative mix of business and operating cost inflation.
"Overall volume was up slightly compared to the prior-year quarter, despite the impact of one fewer business day. GAAP operating profit was further aided by less restructuring asset impairment charges in 2018 compared to 2017.”
The company's consumer packaging segment sales were $570m, compared with $482m in 2017. Operating profit was $61.1m in the first quarter, compared with $59.5m in the same quarter of 2017.
First-quarter 2018 sales for the display and packaging segment were $143m, compared with $115m in 2017.
The Paper and Industrial Converted Products segment reporetd sales of $461m, up from $443m in 2017.
Tiede said: “Our Paper and Industrial Converted Products segment reported its strongest first-quarter operating profit in 10 years, improving 48.2% from last year, while net sales grew 4.1%. The improvement in segment operating profit was primarily driven by a positive price/cost relationship, which more than offset higher operating costs and lower volume/mix which was driven by the current period having one less day than the prior period.”
The company expects second-quarter 2018 base earnings to be in the range of $0.83 to $0.89 per diluted share.
