Sonoco Reports First Quarter Financial Results

Sonoco reported sales for the first quarter were $681.4 million, versus $654.2 million for the same period in 2002. Net income for the quarter was $29 million, versus $33.5 million in the first quarter of 2002.

Cash generated from operations for the first quarter 2003 was $40.7 million, compared with $39 million for the same period in 2002.

"Sales for the first quarter were up 4.2 percent, compared with the same period last year, primarily reflecting increased selling prices for old corrugated containers through the company's recovered paper operations in the industrial segment. Increased sales volume during the quarter in the metal and plastic closures and flexible packaging businesses of the consumer segment also contributed to the company's sales increase.

However, the company noted that earnings were adversely impacted by a negative price/cost relationship, primarily associated with lower average selling prices for global engineered carriers and higher costs for OCC, the primary raw material for engineered carriers; by higher resin costs; and by higher energy costs across the company.

To compensate for the higher raw material costs, the company said it will continue to reduce its cost structure, seeking price increases to help recover higher raw material, energy and pension costs; and continuing to successfully drive productivity improvements.