IP posts strong earnings in Q2 results

International Paper (IP), a Memphis, Tennessee-based global producer of fiber-based packaging, pulp and paper products, has achieved strong net earnings in its second-quarter financial results when compared results from one year ago.

The company reports it achieved second-quarter net earnings of $511 million compared with $432 million in the same period of 2021. Second-quarter adjusted operating earnings were at $459 million in the second quarter of the year compared with $325 million in the second quarter of 2021.

“International Paper delivered strong revenue and earnings growth in the second quarter,” says Mark Sutton, chairman and chief executive officer of International Paper. “We performed well both commercially and operationally, which contributed to margin expansion despite a challenging supply chain and input cost environment.”

According to the company’s second-quarter earnings report, IP’s Industrial Packaging segment achieved operating profits in the second quarter of $560 million compared with $397 million in the first quarter of the year. Within that segment, IP says its North American earnings increased due to higher sales prices for corrugated boxes and containerboard as well as lower planned maintenance outage expenses. The company says these benefits were partially offset by higher input costs for both energy and freight. In Europe, earnings for this segment improved, reflecting higher average sales prices and strong operating performance.

Looking ahead to the third quarter, IP says it expects the realization of prior price movements to output higher input costs.

According to the company’s earnings report presentation July 28, IP anticipates price and mix to improve by $40 million within its Industrial Packaging segment in the third quarter. IP said it expects volume for the Industrial Packaging segment to increase by $10 million in the third quarter due to stable demand. Additionally, the company said it expects maintenance outage expenses to go down by $41 million in the third quarter of the year for its Industrial Packaging segment.

“Sitting here midway through the year, I’m confident in our earnings outlook for 2022 and in our ability to deliver strong earnings growth this year,” Sutton said during the second-quarter earnings presentation. “We’re mindful of the uncertainty surrounding the macro environment. I’m very certain about the resiliency of International Paper. During the past few years, we have significantly enhanced our financial strength and flexibility.”