Packaging co MeadWestvaco 3Q net income falls

AP News
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Posted: Oct 27, 2010 10:08 AM

Packaging company MeadWestvaco Corp. said Wednesday its net income from continuing operations fell 9 percent in the third quarter, despite higher overall sales.

The Richmond company said it earned $111 million, or 64 cents per share for the period ended Sept. 30. That's down from $122 million, or 71 cents per share, a year ago.

Its results include a tax benefit of $15 million, offset by $14 million in restructuring and other charges. Last year's quarter included alternative fuel credits of $64 million that were offset by $55 million in restructuring and other charges.

MeadWestvaco says its sales grew more than 3 percent to $1.56 billion in the quarter, helped by growth in its packaging resources and specialty chemicals segments. The company said its sales in emerging markets have grown by about 12 percent in the quarter, driven by strength in Brazil and China.

Analysts expected a profit of 55 cents per share on sales of $1.67 billion.

The company has gone through a deliberate transformation over the last several years from a mill-centric paper supplier to global partner for brands like Procter & Gamble, Coca-Cola and Walmart. MeadWestvaco said the changes have helped build a company that is more global, innovative and focused.

"Another quarter of improved performance extends the progress we have made by implementing a value-based strategy agenda," CEO John A. Luke Jr. said in a news release.

In the third quarter, the company completed the sale of its global media and entertainment packaging business that was reflected as a loss from discontinued operations of $126 million.

MeadWestvaco, which operates in 30 countries and has customers in more than 100 nations, said it sees generally stable demand trends, but are still below pre-recession levels.