Sonoco Reports for Quarter

Sonoco reported first quarter sales were $654.2 million, versus $632.8 million for the same period in 2001. Excluding one-time items, net income for the first quarter was $34.4 million, versus $37.3 million in the first quarter of 2002. Including one-time items, net income for the first quarter of 2002 was $33.5 million, versus $4.7 million in first quarter of 2001.

``We continue to be adversely impacted by weak general economic conditions, principally affecting our industrial segment, resulting in soft, though slightly improving, engineered carriers and paper volumes. Also, lower average selling prices, which historically occur at this stage in the economic cycle, are becoming an increasingly negative factor in our integrated engineered carriers/paper operations.

“With significant economic recovery, volume and pricing should improve. On the upside of the cycle, costs for OCC, Sonoco's principal raw material, also historically increase. While we are beginning to see some limited signs of volume improvement, we do not anticipate significant general economic recovery before the second half of the year,'' said DeLoach.

DeLoach noted that lower volumes and higher raw material costs in wire and cable reels also contributed to lower earnings for the industrial segment, and that while lower selling prices for trade sales of recovered paper hurt first quarter sales results, these lower prices constituted favorable raw material costs for the Company's paper converting operations. He further said that prices for OCC, the primary component of Sonoco's recovered paper, had remained in the $35 to $40 per ton level for about a year. However, OCC prices have recently increased modestly by about $10 per ton.