Packaging Corporation of America, the third largest producer of containerboard products in North America, shares rose by more than 10% after its second quarter results topped expectations, despite both its profit and revenue falling year-over-year.
For 2Q, it posted earnings per share of $2.31, down from $3.23 in the year-ago quarter but above the Street’s expectation of $1.96, per Zacks Consensus Estimate.
The company said its results were $0.35 above its 2Q guidance of $1.96 due to lower operating costs from efficiency and usage initiatives and lower freight and logistics expenses.
Revenue fell from $2.2 billion in the year-ago quarter to $2 billion, modestly ahead of the expected $1.99 billion.
The company noted that its 2Q earnings decrease was driven by lower volumes in the packaging and paper segments, lower price and mix in the packaging segment, higher depreciation expense, and higher other converting costs.
This was partially offset by lower operating costs, higher prices and mix in the paper segment, a lower share count resulting from share repurchases in the second half of 2022, lower scheduled maintenance outage expenses, and a lower tax rate.
Packaging Corporation of America shares were up 10.7% at US$153.48 late morning on Tuesday.
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