Specialty paper maker Schweitzer-Mauduit International Inc. said its third-quarter profit plunged by one-third, but its adjusted results widely exceeded Wall Street expectations and it raised its 2009 outlook.

Shares of the Alpharetta, Ga., company rose sharply Wednesday to reach a 52-week high.

Net income of $4.5 million, or 27 cents per share, was down from $6.7 million, or 43 cents per share, a year ago. During the quarter, the company closed a production site in France and downsized in other areas due to declines in demand for its traditional tobacco-related papers in North America and western Europe. Excluding related restructuring charges of $26.7 million, adjusted income totaled $1.39 per share in the latest period.

Revenue of $184.5 million for the quarter ended Sept. 30 was down 7 percent from $199.2 million in the year-ago period, as volumes declined and foreign exchange rates fluctuated. Improved product mix and higher selling prices partially offset those declines.

Analysts surveyed by Thomson Reuters had expected earnings of 93 cents per share on revenue of $185.9 million. Analysts typically exclude one-time charges.

The company said expected sales volume declines and resulting isolated paper machine downtime, in part to reduce its inventory levels, are Schweitzer-Mauduit's biggest challenges for the balance of the year.

Schweitzer-Mauduit said it continued to experience decreased demand in the North American and, increasingly western European markets, all of which have been impacted by the global economic recession and increases in taxes on cigarettes and cigars.

Still, the company said it expects full-year 2009 earnings of at least $4 per share, excluding restructuring and impairment expenses but including operating losses of about 50 cents per share related to the closing of a plant. That's up from previous guidance of more than $3.50 per share.

For 2010, Schweitzer-Mauduit forecast earnings per share of about $5, excluding restructuring and impairment expenses.

Analysts, on average, expect earnings to be $4 per share this year and $5.02 per share for 2010.

The company also said that it will build a plant in the Philippines to boost global reconstituted tobacco leaf production capacity by 38 percent, and help it meet growing demand for the product. Schweitzer-Mauduit said it expects operations to begin there in late 2011.

Shares jumped $4.64, or 8.7 percent, to finish at $58.16, having hit a 52-week high of $60.27 earlier in the session.