) second-quarter fiscal 2013 adjusted earnings came in at $1.12
per share, up 15% from the year-ago quarter's earnings of 97
cents per share, well ahead of the Zacks Consensus Estimate of
The quarter excluded a tax benefit due to the reversal of
previously established tax reserves relating to alternative fuel
mixture credits acquired in the Smurfit-Stone Acquisition of
$3.47 per share and restructuring and other costs as well as
operating losses and transition costs stemming from plant
closures of 14 cents per share. The year-ago quarter noted
expenses related to restructuring and other as well as operating
losses and transition costs stemming from plant closures of 36
cents per share and loss of 17 cents per share on early
extinguishment of debt. Including these items, earnings in the
reported quarter were $4.45 per share compared with 44 cents per
share in the year-ago quarter.
Total revenue improved 2% year over year to $2.325 billion,
missing the Zacks Consensus Estimate of $2.355 billion. The top
line decreased due to lower sales in the Consumer Packaging and
Recycling segments, somewhat offset by increase in the Corrugated
Cost of goods sold edged up 1% to $1.94 billion. Gross profit
increased 7% to $385 million. Selling, general and administrative
expenses increased 3% to $237 million. Adjusted operating income
increased 13% to $148 million.
Corrugated Packaging Segment: Net sales in the segment rose 7% to
$1.6 billion in the quarter. Adjusted operating income surged 67%
to $114 million. Results were aided by higher selling prices and
containerboard volume, partially offset by higher operating
expenses including $12 million of incremental maintenance outage
Consumer Packaging Segment: The segment's net sales slipped 3% to
$626 million. Operating income declined 25% to $63 million as a
result of lower selling prices, lower display sales and lower
bleached paperboard volume, due to the planned major maintenance
outage at RockTenn's Demopolis bleached paperboard mill.
Recycling: Net sales in the segment fell 8% to $271 million due
to lower volume. The segment reported operating income of $3.5
million, down 17% from $4.2 million in the year-ago quarter.
Cash and cash equivalents increased to $51.3 million as of Mar
31, 2013, from $37.2 million as of Sep 30, 2012. Cash provided by
operating activities were $175 million for second-quarter fiscal
2013, compared to $193 million in the year-ago quarter.
Debt-to-capitalization ratio improved to 45% as of Mar 31, 2013,
from 50% as of Sep 30, 2012. RockTenn also increased its
annualized dividend by 33% to $1.20 per share. The increased
dividend will be paid on May 20, 2013.
RockTenn is one of the leading integrated manufacturers of
corrugated and consumer packaging and recycling solutions in
North America. It operates in the U.S., Canada, Mexico, Chile,
Argentina and China.
RockTenn currently retains a short-term Zacks Rank #2 (Buy).
Other stocks with a favorable Zacks Rank in the same industry are
PH Glatfelter Co.
KapStone Paper and Packaging Corporation
Resolute Forest Products Inc.
), with a Zacks Rank #1 (Strong Buy).
GLATFELTER (GLT): Free Stock Analysis Report
KAPSTONE PAPER (KS): Free Stock Analysis
RESOLUTE FOREST (RFP): Free Stock Analysis
ROCK-TENN CO (RKT): Free Stock Analysis
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