WestRock beats quarterly profit estimates on rising prices (updated)
02/05/2024 14:54
(Updates shares; adds Smurfit results)
May 2 (Reuters) - WestRock WRK.N beat quarterly profit
expectations on Thursday, banking on higher prices, easing input
costs and a rebound in demand for its paper packaging products,
sending its shares up 6.3% in early trading.
The company, which is being acquired by Ireland-based
Smurfit Kappa for $11 billion, has redirected its focus toward
bolstering its corrugated packaging portfolio and implemented
cost-saving measures by shutting a few of its paper mills in the
prior year.
Operating costs for materials such as chemicals, wood and
recycled fiber have also eased from their highs.
The shift away from plastic packaging and the rise of online
shopping have helped WestRock maintain high prices and combat
steeper costs and inflation-strained consumer budgets.
Smurfit Kappa SKG.I also posted first-quarter core
profit
higher
than the final quarter of 2023, when it signaled a dip in
demand for packaging.
On an adjusted basis, WestRock earned 39 cents per share,
exceeding market expectations of 23 cents.
Still, its second-quarter revenue fell 10.4% to $4.73
billion, compared with analysts' estimates of $4.75 billion,
according to LSEG data.
(Reporting by Annett Mary Manoj in Bengaluru; Editing by Devika
Syamnath)
((AnnettMary.Manoj@thomsonreuters.com))