Packaging company International Paper beat Wall Street expectations for first-quarter sales on Thursday, capitalizing on higher prices, improved production and a recovery in demand for its products.
Initially driven by a surge in online shopping during the pandemic, paper and packaging companies faced a slowdown as economies reopened. However, demand is increasing again and costs – namely energy, production factors, freight and wood – have moderated in relation to previous highs.
Peer Packaging Corp of America reported a drop in quarterly revenue on Tuesday due to higher prices, improved production and a recovery in demand for its corrugated packaging products.
Earlier this year, European packaging giant Smurfit Kappa said the worst of the slowdown in demand for packaging paper and cardboard appeared to be behind it.
International Paper’s total net sales fell about 8% to $4.61 billion in the first quarter, but beat analysts’ estimate of $4.56 billion, according to LSEG data.
On an adjusted basis, the company’s operating profit was 17 cents per share, missing expectations of 22 cents per share, sending shares down 2% in premarket trading.
The world’s leading paper company by revenue agreed an all-share deal to buy DS Smith earlier this month, valuing the British packaging company at £5.8 billion ($7.2 billion) and surpassing an offer from Mondi.
The report is from Reuters.
Tags: International Paper leads quarterly sales due higher prices demand recovery
