Packaging Corp Of America Reports Mixed Q3 Earnings: CEO Highlights Cost-Effective Operations

Packaging Corp Of America PKG reported a third-quarter FY23 sales decline of 8.94% year-on-year to $1.94 billion, missing the analyst consensus estimate of $1.99 billion.

Segment Revenues: Packaging slipped 9.3% to $1.75 billion and Paper dropped 4.5% to $157.9 million.

The gross profit for the quarter dropped 20.4% to $412.7 million with a profit margin of 21.3%.

The operating income declined 28.2% to $258.6 million with an operating margin of 13.4%.

Adjusted EBITDA of $387.8 million decreased 18.7% Y/Y.

Adjusted EPS of $2.05 beat the consensus estimate of $1.93.

“The scheduled maintenance outages at our mills were executed well, and we also ran the containerboard system in a very cost-effective manner to match our supply with demand, which included keeping our Wallula, WA mill temporarily idled during the quarter,” said Chairman and CEO Mark W. Kowlzan.

Cash and equivalents and marketable debt securities as of Sept. 30, 2023 totaled $726.5 million.

Price Action: PKG shares were up 2.4% at $148.00 at the time of publication Tuesday.

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