Packaging Corporation of America (NYSE: PKG) today reported second quarter net income of $64 million, or $0.66 per share, which included a one-time, non-cash charge of $5 million after tax, or $0.05 per share, for pension plan changes. Excluding special items, net income was $69 million, or $0.71 per share, a quarterly record, compared to second quarter 2012 net income of $48 million, or $0.49 per share. Net sales were a record $800 million, up 12% from second quarter 2012 net sales of $712 million.
The $0.22 per share increase in net income, excluding special items, was driven by higher containerboard and corrugated products prices and mix ($0.27) and higher corrugated products sales volume ($0.05). These items were partially offset by higher costs for energy ($0.04), labor and fringe benefits ($0.03) and the timing of annual mill maintenance outages ($0.03).
Excluding special items, net income for the first six months of 2013 was $130 million, or $1.33 per share, compared to net income for the first six months of 2012 of $88 million, or $0.91 per share. Year-to-date net sales were $1.56 billion compared to $1.38 billion in 2012, up 12%.
Corrugated products shipments per workday were up 5.2%, and total shipments were up 6.8% with one more workday in this year’s second quarter. Containerboard production was 629,000 tons, down 9,000 tons from last year’s second quarter, and outside sales of containerboard were down by the same amount. Lower containerboard production was the result of scheduling more annual mill maintenance downtime in this year’s second quarter, but based on days of operation, the mills set a second quarter record for tons produced per day. PCA ended the quarter with its containerboard inventories down about 12,000 tons below the end of the first quarter.
Commenting on reported results, Mark W. Kowlzan, Chief Executive Officer of PCA, said, “We had an outstanding quarter in all aspects of our operations with record earnings driven by higher prices and higher corrugated products volume. The annual outages at three of our mills went extremely well with very efficient start-ups and record productivity. Earnings were higher than our second quarter guidance driven by better than forecasted sales volume and price, and lower than forecasted costs.”