Sonoco Reports Second Quarter 2020 Results
Second Quarter Highlights
- Second-quarter 2020 GAAP earnings per diluted share were
$0.55 , compared with$0.80 in 2019. - Second-quarter 2020 GAAP earnings included net after-tax charges of
$24.9 million related primarily to operational restructuring activity and non-operating pension costs. In the second quarter of 2019, GAAP earnings included net after-tax charges of$15.3 million related mostly to restructuring actions and non-operating pension costs. - Base net income attributable to
Sonoco (base earnings) for second-quarter 2020 was$0.79 per diluted share, compared with$0.95 in 2019. (See base earnings definition, explanation and reconciliation to GAAP earnings later in this release.)Sonoco previously provided second-quarter 2020 base earnings guidance of$0.73 to$0.83 per diluted share. - Second-quarter 2020 net sales were
$1.25 billion , compared with$1.36 billion in 2019. - Cash flow from operations was
$281.0 million in the first half of 2020, compared to$40.1 million in 2019. Free cash flow was$123.1 million , compared with$(144.9) million in the first six months of 2019. (See free cash flow definition and reconciliation to cash flow from operations later in this release.)
2020 Third Quarter Guidance
Sonoco expects third-quarter base earnings to be in a range of$0.73 to$0.83 per diluted share, compared to$0.97 per diluted share reported in the third quarter of 2019.
Note: Third-quarter 2020 GAAP guidance is not provided in this release due to the likely occurrence of one or more of the following, the timing and magnitude of which we are unable to reliably forecast: restructuring costs and restructuring-related impairment charges, acquisition-related costs, possible gains or losses on the sale of businesses or other assets, and the income tax effects of these items and/or other income tax-related events. These items could have a significant impact on the Company's future GAAP results.
CEO Comments
Commenting on the Company’s second-quarter performance,
"We're also very pleased with our strong cash flow generation during the quarter which shows the resiliency of our business and the focus of our team on this very important activity.
COVID-19 Update
Health, Safety and Business Continuity
The health and safety of Sonoco’s associates, contractors, suppliers and the general public are a top priority. Included among the safety measures implemented are: conducting health screenings for personnel entering our operations, providing personal protective equipment, routinely cleaning high-touch surfaces, following social distancing protocols, prohibiting all non-critical business travel, and encouraging all associates to work from home when possible. Additionally,
Financial Flexibility and Liquidity
Second Quarter Review
Net sales for the second quarter of 2020 were
GAAP net income attributable to
Gross profit was
Segment Review
Sonoco’s
Second-quarter 2020 sales for the segment were
Segment sales increased 2.0 percent compared to the prior year's quarter due to solid volume/mix growth and sales added from the
Segment operating profit increased 36.8 percent compared to the prior year's quarter as the benefit of strong productivity improvements along with solid volume/mix improvement, a positive price/cost relationship and cost controls all contributed to the record performance. Segment operating margin improved to 14.0 percent in the quarter from 10.4 percent in the 2019 period.
Second-quarter 2020 sales were
Sales declined 20.4 percent compared to last year’s quarter due to lower volume in domestic displays, paper amenities and retail security packaging as well as the negative impact of foreign exchange translation. Segment operating profit improved slightly due to productivity improvements and cost controls, mostly offset by lower volume/mix. Segment operating margin improved to 5.6 percent in the quarter up from 4.4 percent in 2019.
Paper and Industrial Converted Products
The Paper and Industrial Converted Products segment includes the following products: paperboard tubes, cones, and cores; fiber-based construction tubes; wooden, metal and composite wire and cable reels and spools; and recycled paperboard, linerboard, corrugating medium, recovered paper and material recycling services.
Second-quarter 2020 sales for the segment were
Segment sales declined 11.6 percent from the prior year's quarter as lower volume/mix, the negative impact of foreign exchange translation and lower selling prices more than offset sales gained from the acquisition of
Protective Solutions
The Protective Solutions segment includes the following products: custom-engineered, paperboard-based and expanded foam protective packaging and components; and temperature-assured packaging.
Second-quarter 2020 sales were
Segment sales declined 31.9 percent driven primarily by virus-related customer shutdowns which negatively impacted demand for molded foam automotive components and consumer fiber packaging for appliances. ThermoSafe temperature-assured packaging volume also declined due to reduced demand for transporting pharmaceuticals to medical clinics as non-virus related treatments were postponed. Segment operating margin declined to 5.0 percent from the prior year quarter's 10.9 percent.
Corporate/Tax
Net interest expense for the second quarter of 2020 increased to
Year-to-date Results
For the first six months of 2020 net sales were
GAAP net income attributable to
Base earnings for the first six months of 2020 were
Current year-to-date gross profit was
Cash Flow and Free Cash Flow
Although net income decreased year over year, cash generated from operations for the first six months of 2020 was
Free cash flow for the first six months of 2020 was
As of
Third Quarter Outlook
The Company projects third-quarter 2020 base earnings to be in the range of
Although the Company believes the assumptions reflected in the range of guidance are reasonable, given the unprecedented uncertainty regarding the impact of the COVID-19 pandemic, as well as other risks and uncertainties, including those described further below, actual results could vary substantially.
Commenting on the Company’s outlook, Coker said, “History has shown that past disruptions of the magnitude of the current virus-induced recession, as painful as they can be, have often boosted
Conference Call Webcast
Management will host a conference call and webcast to further discuss these results beginning at
About
Founded in 1899,
Forward-looking Statements
Statements included herein that are not historical in nature, are intended to be, and are hereby identified as “forward-looking statements” for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended. In addition, the Company and its representatives may from time to time make other oral or written statements that are also “forward-looking statements.” Words such as “estimate,” “project,” “intend,” “expect,” “believe,” “consider,” “plan,” “strategy,” “opportunity,” “commitment,” “target,” “anticipate,” “objective,” “goal,” “guidance,” “outlook,” “forecast,” “future,” “re-envision,” “assume,” “will,” “would,” “can,” “could,” “may,” “might,” “aspires,” “potential,” or the negative thereof, and similar expressions identify forward-looking statements.
Forward-looking statements include, but are not limited to, statements regarding: availability and supply of raw materials, and offsetting high raw material costs; improved productivity and cost containment; improving margins and leveraging strong cash flow and financial position; effects of acquisitions and dispositions; realization of synergies resulting from acquisitions; costs, timing and effects of restructuring activities; adequacy and anticipated amounts and uses of cash flows; expected amounts of capital spending; refinancing and repayment of debt; financial strategies and the results expected of them; financial results for future periods; producing improvements in earnings; profitable sales growth and rates of growth; consumer and customer actions in connection with the COVID-19 pandemic; market leadership; research and development spending; extent of, and adequacy of provisions for, environmental liabilities; adequacy of income tax provisions, realization of deferred tax assets, outcomes of uncertain tax issues and tax rates; goodwill impairment charges and fair values of reporting units; future asset impairment charges and fair values of assets; anticipated contributions to pension and postretirement benefit plans, fair values of plan assets, long-term rates of return on plan assets, and projected benefit obligations and payments; creation of long-term value and returns for shareholders; continued payment of dividends; and planned stock repurchases.
Such forward-looking statements are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management. Such information includes, without limitation, discussions as to guidance and other estimates, perceived opportunities, expectations, beliefs, plans, strategies, goals and objectives concerning our future financial and operating performance. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual results may differ materially from those expressed or forecasted in such forward-looking statements. The risks, uncertainties and assumptions include, without limitation:
- availability and pricing of raw materials, energy and transportation, and the Company's ability to pass raw material, energy and transportation price increases and surcharges through to customers or otherwise manage these commodity pricing risks;
- impacts arising as a result of the COVID-19 Coronavirus global pandemic on our results of operations, financial condition, value of assets, liquidity, prospects, growth, and on the industries in which we operate and that we serve, resulting from, without limitation, recent and ongoing financial market volatility, potential governmental actions, changes in consumer behaviors and demand, changes in customer requirements, disruptions of the Company suppliers and supply chain, availability of labor and personnel, necessary modifications to operations and business, and uncertainties about the extent and duration of the pandemic;
- costs of labor;
- work stoppages due to labor disputes;
- success of new product development, introduction and sales;
- consumer demand for products and changing consumer preferences;
- ability to be the low-cost global leader in customer-preferred packaging solutions within targeted segments;
- competitive pressures, including new product development, industry overcapacity, and changes in competitors’ pricing for products;
- ability to maintain or increase productivity levels, contain or reduce costs, and maintain positive price/cost relationships;
- ability to negotiate or retain contracts with customers, including in segments with concentration of sales volume;
- ability to improve margins and leverage cash flows and financial position;
- continued strength of our paperboard-based tubes and cores and composite can operations;
- ability to manage the mix of business to take advantage of growing markets while reducing cyclical effects of some of the Company’s existing businesses on operating results;
- ability to maintain innovative technological market leadership and a reputation for quality;
- ability to profitably maintain and grow existing domestic and international business and market share;
- ability to expand geographically and win profitable new business;
- ability to identify and successfully close suitable acquisitions at the levels needed to meet growth targets, and successfully integrate newly acquired businesses into the Company’s operations;
- the costs, timing and results of restructuring activities;
- availability of credit to us, our customers and suppliers in needed amounts and on reasonable terms;
- effects of our indebtedness on our cash flow and business activities;
- fluctuations in obligations and earnings of pension and postretirement benefit plans;
- accuracy of assumptions underlying projections of benefit plan obligations and payments, valuation of plan assets, and projections of long-term rates of return;
- cost of employee and retiree medical, health and life insurance benefits;
- resolution of income tax contingencies;
- foreign currency exchange rate fluctuations, interest rate and commodity price risk and the effectiveness of related hedges;
- changes in
U.S. and foreign tariffs, tax rates, and tax laws, regulations and interpretations thereof; - accuracy in valuation of deferred tax assets;
- accuracy of assumptions underlying projections related to goodwill impairment testing, and accuracy of management’s assessment of goodwill impairment;
- accuracy of assumptions underlying fair value measurements, accuracy of management’s assessments of fair value and fluctuations in fair value;
- liability for and anticipated costs of environmental remediation actions;
- effects of environmental laws and regulations;
- operational disruptions at our major facilities;
- failure or disruptions in our information technologies;
- loss of consumer or investor confidence;
- ability to protect our intellectual property rights;
- actions of domestic or foreign government agencies and changes in laws and regulations affecting the Company;
- international, national and local economic and market conditions and levels of unemployment; and
- economic disruptions resulting from terrorist activities and natural disasters.
The Company undertakes no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed herein might not occur.
Additional information concerning some of the factors that could cause materially different results is included in the Company’s reports on forms 10-K, 10-Q and 8-K filed with the
References to our Website Address
References to our website address and domain names throughout this release are for informational purposes only, or to fulfill specific disclosure requirements of the Securities and Exchange Commission’s rules or the New York Stock Exchange Listing Standards. These references are not intended to, and do not, incorporate the contents of our website by reference into this release.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | |||||||||||||||||||
(Dollars and shares in thousands except per share) | |||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||
Net sales | $ | 1,245,485 | $ | 1,359,721 | $ | 2,548,781 | $ | 2,711,426 | |||||||||||
Cost of sales | 997,502 | 1,084,385 | 2,034,208 | 2,165,969 | |||||||||||||||
Gross profit | 247,983 | 275,336 | 514,573 | 545,457 | |||||||||||||||
Selling, general and administrative expenses | 121,371 | 132,213 | 245,259 | 274,774 | |||||||||||||||
Restructuring/Asset impairment charges | 22,885 | 13,355 | 35,484 | 24,027 | |||||||||||||||
Operating profit | $ | 103,727 | $ | 129,768 | $ | 233,830 | $ | 246,656 | |||||||||||
Non-operating pension cost | 7,600 | 5,550 | 15,179 | 11,591 | |||||||||||||||
Net interest expense | 18,685 | 15,952 | 34,730 | 31,337 | |||||||||||||||
Income before income taxes | 77,442 | 108,266 | 183,921 | 203,728 | |||||||||||||||
Provision for income taxes | 23,230 | 28,491 | 49,986 | 51,115 | |||||||||||||||
Income before equity in earnings of affiliates | 54,212 | 79,775 | 133,935 | 152,613 | |||||||||||||||
Equity in earnings of affiliates, net of tax | 778 | 1,511 | 1,291 | 2,441 | |||||||||||||||
Net income | 54,990 | 81,286 | 135,226 | 155,054 | |||||||||||||||
Net (income) loss attributable to noncontrolling interests | 221 | (127 | ) | 430 | (232 | ) | |||||||||||||
Net income attributable to |
$ | 55,211 | $ | 81,159 | $ | 135,656 | $ | 154,822 | |||||||||||
Weighted average common shares outstanding – diluted | 101,109 | 101,178 | 101,109 | 101,129 | |||||||||||||||
Diluted earnings per common share | $ | 0.55 | $ | 0.80 | $ | 1.34 | $ | 1.53 | |||||||||||
Dividends per common share | $ | 0.43 | $ | 0.43 | $ | 0.86 | $ | 0.84 |
FINANCIAL SEGMENT INFORMATION (Unaudited) | |||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||
Net sales | |||||||||||||||||||||
$ | 614,621 | $ | 602,750 | $ | 1,203,038 | $ | 1,192,466 | ||||||||||||||
107,303 | 134,833 | 228,659 | 272,387 | ||||||||||||||||||
Paper and Industrial Converted Products | 434,452 | 491,328 | 909,422 | 987,365 | |||||||||||||||||
Protective Solutions | 89,109 | 130,810 | 207,662 | 259,208 | |||||||||||||||||
Consolidated | $ | 1,245,485 | $ | 1,359,721 | $ | 2,548,781 | $ | 2,711,426 | |||||||||||||
Segment operating profit: | |||||||||||||||||||||
$ | 86,129 | $ | 62,942 | $ | 153,930 | $ | 125,057 | ||||||||||||||
5,981 | 5,889 | 14,075 | 12,343 | ||||||||||||||||||
Paper and Industrial Converted Products | 29,964 | 61,229 | 83,977 | 109,616 | |||||||||||||||||
Protective Solutions | 4,482 | 14,275 | 18,486 | 25,279 | |||||||||||||||||
Restructuring/Asset impairment charges | (22,885 | ) | (13,355 | ) | (35,484 | ) | (24,027 | ) | |||||||||||||
Other non-base charges, net | 56 | (1,212 | ) | (1,154 | ) | (1,612 | ) | ||||||||||||||
Consolidated | $ | 103,727 | $ | 129,768 | $ | 233,830 | $ | 246,656 | |||||||||||||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) | |||||||||||
(Dollars in thousands) | |||||||||||
Six Months Ended | |||||||||||
Net income | $ | 135,226 | $ | 155,054 | |||||||
Asset impairment charges/losses on disposition of assets | 6,494 | 11,227 | |||||||||
Depreciation, depletion and amortization | 123,447 | 116,978 | |||||||||
Pension and postretirement plan contributions, net of non-cash expense | (1,970 | ) | (199,932 | ) | |||||||
Changes in working capital | (27,595 | ) | (65,858 | ) | |||||||
Changes in tax accounts | 28,186 | 10,963 | |||||||||
Other operating activity | 17,259 | 11,649 | |||||||||
Net cash provided by operating activities | 281,047 | 40,081 | |||||||||
Purchase of property, plant and equipment, net | (71,572 | ) | (100,774 | ) | |||||||
Cost of acquisitions, net of cash acquired | (3,787 | ) | (455 | ) | |||||||
Net debt proceeds | 586,113 | 144,369 | |||||||||
Cash dividends paid | (86,337 | ) | (84,160 | ) | |||||||
Other, including effects of exchange rates on cash | 6,525 | (23,155 | ) | ||||||||
Net increase in cash and cash equivalents | 711,989 | (24,094 | ) | ||||||||
Cash and cash equivalents at beginning of period | $ | 145,283 | $ | 120,389 | |||||||
Cash and cash equivalents at end of period | $ | 857,272 | $ | 96,295 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||||||
(Dollars in thousands) | |||||||||
Assets | |||||||||
Current Assets: | |||||||||
Cash and cash equivalents | $ | 857,272 | $ | 145,283 | |||||
Trade accounts receivable, net of allowances | 692,943 | 698,149 | |||||||
Other receivables | 104,397 | 113,754 | |||||||
Inventories | 523,855 | 503,808 | |||||||
Prepaid expenses and deferred income taxes | 60,195 | 60,202 | |||||||
2,238,662 | 1,521,196 | ||||||||
Property, plant and equipment, net | 1,235,505 | 1,286,842 | |||||||
Right of use asset-operating leases | 294,050 | 298,393 | |||||||
1,423,712 | 1,429,346 | ||||||||
Other intangible assets, net | 360,996 | 388,292 | |||||||
Other assets | 185,935 | 202,220 | |||||||
$ | 5,738,860 | $ | 5,126,289 | ||||||
Liabilities and Shareholders’ Equity | |||||||||
Current Liabilities: | |||||||||
Payable to suppliers and other payables | $ | 908,392 | $ | 904,878 | |||||
Notes payable and current portion of long-term debt | 646,623 | 488,234 | |||||||
Income taxes payable | 21,257 | 11,380 | |||||||
1,576,272 | 1,404,492 | ||||||||
Long-term debt, net of current portion | 1,618,640 | 1,193,135 | |||||||
Noncurrent operating lease liabilities | 249,217 | 253,992 | |||||||
Pension and other postretirement benefits | 303,606 | 304,798 | |||||||
Deferred income taxes and other | 183,421 | 154,167 | |||||||
Total equity | 1,807,704 | 1,815,705 | |||||||
$ | 5,738,860 | $ | 5,126,289 |
Definition and Reconciliation of Non-GAAP Financial Measures
The Company’s results determined in accordance with
These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles.
To compensate for these limitations, management believes that it is useful in understanding and analyzing the results of the business to review both GAAP information which includes all of the items impacting financial results and the non-GAAP measures that exclude certain elements, as described above. Whenever
Non-GAAP Adjustments | |||||||||||||||||||||
Three Months Ended |
GAAP | Restructuring / Asset Impairment Charges(1) |
Other Adjustments(2) |
Base | |||||||||||||||||
Operating profit | $ | 103,727 | $ | 22,885 | $ | (56 | ) | $ | 126,556 | ||||||||||||
Non-operating pension costs | 7,600 | — | (7,600 | ) | — | ||||||||||||||||
Interest expense, net | 18,685 | — | — | 18,685 | |||||||||||||||||
Income before income taxes | 77,442 | 22,885 | 7,544 | 107,871 | |||||||||||||||||
Provision for income taxes | 23,230 | 6,224 | (717 | ) | 28,737 | ||||||||||||||||
Income before equity in earnings of affiliates | 54,212 | 16,661 | 8,261 | 79,134 | |||||||||||||||||
Equity in earnings of affiliates, net of taxes | 778 | — | — | 778 | |||||||||||||||||
Net income | 54,990 | 16,661 | 8,261 | 79,912 | |||||||||||||||||
Net loss/(income) attributable to noncontrolling interests | 221 | (6 | ) | — | 215 | ||||||||||||||||
Net income attributable to |
$ | 55,211 | $ | 16,655 | $ | 8,261 | $ | 80,127 | |||||||||||||
Per Diluted Share | $ | 0.55 | $ | 0.16 | $ | 0.08 | $ | 0.79 | |||||||||||||
*Due to rounding individual items may not sum across | |||||||||||||||||||||
Non-GAAP Adjustments | |||||||||||||||||||||
Three Months Ended |
GAAP | Restructuring / Asset Impairment Charges(1) |
Other Adjustments(3) |
Base | |||||||||||||||||
Operating profit | $ | 129,768 | $ | 13,355 | $ | 1,212 | $ | 144,335 | |||||||||||||
Non-operating pension costs | 5,550 | — | (5,550 | ) | — | ||||||||||||||||
Interest expense, net | 15,952 | — | — | 15,952 | |||||||||||||||||
Income before income taxes | 108,266 | 13,355 | 6,762 | 128,383 | |||||||||||||||||
Provision for income taxes | 28,491 | 3,307 | 1,430 | 33,228 | |||||||||||||||||
Income before equity in earnings of affiliates | 79,775 | 10,048 | 5,332 | 95,155 | |||||||||||||||||
Equity in earnings of affiliates, net of taxes | 1,511 | — | — | 1,511 | |||||||||||||||||
Net income | 81,286 | 10,048 | 5,332 | 96,666 | |||||||||||||||||
Net (income) attributable to noncontrolling interests | (127 | ) | (69 | ) | — | (196 | ) | ||||||||||||||
Net income attributable to |
$ | 81,159 | $ | 9,979 | $ | 5,332 | $ | 96,470 | |||||||||||||
Per Diluted Share | $ | 0.80 | $ | 0.10 | $ | 0.05 | $ | 0.95 | |||||||||||||
*Due to rounding individual items may not sum across |
(1) Restructuring/Asset impairment charges are a recurring item as Sonoco’s restructuring programs usually require several years to fully implement and the Company is continually seeking to take actions that could enhance its efficiency. Although recurring, these charges are subject to significant fluctuations from period to period due to the varying levels of restructuring activity and the inherent imprecision in the estimates used to recognize the impairment of assets and the wide variety of costs and taxes associated with severance and termination benefits in the countries in which the restructuring actions occur. | |||||||||
(2) Consists mainly of non-operating pension costs and costs related to actual and potential acquisitions and divestitures. Also includes the anticipated impact of settlement of a |
|||||||||
(3) Consists mainly of non-operating pension costs and costs related to actual and potential acquisitions and divestitures. | |||||||||
Non-GAAP Adjustments | |||||||||||||||||||||
Six Months Ended |
GAAP | Restructuring / Asset Impairment Charges(1) |
Other Adjustments(2) |
Base | |||||||||||||||||
Operating profit | $ | 233,830 | $ | 35,484 | $ | 1,154 | $ | 270,468 | |||||||||||||
Non-operating pension costs | 15,179 | — | (15,179 | ) | — | ||||||||||||||||
Interest expense, net | 34,730 | — | — | 34,730 | |||||||||||||||||
Income before income taxes | 183,921 | 35,484 | 16,333 | 235,738 | |||||||||||||||||
Provision for income taxes | 49,986 | 9,353 | 2,683 | 62,022 | |||||||||||||||||
Income before equity in earnings of affiliates | 133,935 | 26,131 | 13,650 | 173,716 | |||||||||||||||||
Equity in earnings of affiliates, net of taxes | 1,291 | — | — | 1,291 | |||||||||||||||||
Net income | 135,226 | 26,131 | 13,650 | 175,007 | |||||||||||||||||
Net (income) attributable to noncontrolling interests | 430 | (17 | ) | — | 413 | ||||||||||||||||
Net income attributable to |
$ | 135,656 | $ | 26,114 | $ | 13,650 | $ | 175,420 | |||||||||||||
Per Diluted Share* | $ | 1.34 | $ | 0.26 | $ | 0.14 | $ | 1.73 | |||||||||||||
*Due to rounding individual items may not sum across | |||||||||||||||||||||
Non-GAAP Adjustments | |||||||||||||||||||||
Six Months Ended |
GAAP | Restructuring / Asset Impairment Charges(1) |
Other Adjustments(3) |
Base | |||||||||||||||||
Operating profit | $ | 246,656 | $ | 24,027 | $ | 1,612 | $ | 272,295 | |||||||||||||
Non-operating pension costs | 11,591 | — | (11,591 | ) | — | ||||||||||||||||
Interest expense, net | 31,337 | — | — | 31,337 | |||||||||||||||||
Income before income taxes | 203,728 | 24,027 | 13,203 | 240,958 | |||||||||||||||||
Provision for income taxes | 51,115 | 5,945 | 3,315 | 60,375 | |||||||||||||||||
Income before equity in earnings of affiliates | 152,613 | 18,082 | 9,888 | 180,583 | |||||||||||||||||
Equity in earnings of affiliates, net of taxes | 2,441 | — | — | 2,441 | |||||||||||||||||
Net income | 155,054 | 18,082 | 9,888 | 183,024 | |||||||||||||||||
Net (income) attributable to noncontrolling interests | (232 | ) | (138 | ) | — | (370 | ) | ||||||||||||||
Net income attributable to |
$ | 154,822 | $ | 17,944 | $ | 9,888 | $ | 182,654 | |||||||||||||
Per Diluted Share* | $ | 1.53 | $ | 0.18 | $ | 0.10 | $ | 1.81 | |||||||||||||
*Due to rounding individual items may not sum across |
(1) Restructuring/Asset impairment charges are a recurring item as Sonoco’s restructuring programs usually require several years to fully implement and the Company is continually seeking to take actions that could enhance its efficiency. Although recurring, these charges are subject to significant fluctuations from period to period due to the varying levels of restructuring activity and the inherent imprecision in the estimates used to recognize the impairment of assets and the wide variety of costs and taxes associated with severance and termination benefits in the countries in which the restructuring actions occur. | |||||
(2) Consists mainly of non-operating pension costs and costs related to actual and potential acquisitions and divestitures. Also includes the anticipated impact of settlement of a |
|||||
(3) Consists mainly of non-operating pension costs and costs related to actual and potential acquisitions and divestitures. | |||||
Six Months Ended | |||||||||||||||
FREE CASH FLOW* | |||||||||||||||
Net cash provided by operating activities | $ | 281,047 | $ | 40,081 | |||||||||||
Purchase of property, plant and equipment, net | (71,572 | ) | (100,774 | ) | |||||||||||
Cash dividends | (86,337 | ) | (84,160 | ) | |||||||||||
Free Cash Flow | $ | 123,138 | $ | (144,853 | ) | ||||||||||
* Free Cash Flow is a non-GAAP measure that does not imply the amount of residual cash flow available for discretionary expenditures, as it excludes mandatory debt service requirements and other non-discretionary expenditures. |
Contact:Roger Schrum +843-339-6018 roger.schrum@sonoco.com
Source: Sonoco Products Company