Greif reports profit drop in first quarter

1 March 2012 (Last Updated March 1st, 2012 18:30)

US-based industrial packaging products and services provider Greif has reported a decline in its first quarter operating profit from $68.7m in 2011 to $58.3m this year.

US-based industrial packaging products and services provider Greif has reported a decline in its first quarter operating profit from $68.7m in 2011 to $58.3m this year.

The company's net income for the first quarter ended 31 January 2012 declined to $23.9m from $41.4m in the previous year.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) also declined, to $97.2m in 2012 from $103.7m in 2011.

Net sales on the other hand showed a 5% increase to $992.7m, compared to $943.8m for the same period in 2011, and the company's gross profit rose to $178.7m against $176.1m last year, while gross profit margin was 18% compared to 18.7% a year ago.

According to Greif, net sales of its rigid industrial packaging and service unit increased by 8% to $703.3m from $653.9m, while gross profit declined to $120.6m from $121.2m in 2011.

Flexible products and services net sales decreased to $114.8m for the quarter compared to $128m and gross profit was $23.7m compared to $24.5m one year ago.

The company's paper packaging segment posted a 7% rise in net sales of $168.1m, compared to $156.8m and gross profit of $31.2m compared to $28.3m last year.

The company anticipates an overall modest improvement in the next quarter despite the continually challenging market conditions for its two main business units, especially in Europe.