lowered its outlook for the quarter on Tuesday, citing lower-than-expected sales in all flexible-packaging product lines.
After previously estimating earnings of 83 cents to 86 cents per share for its second quarter, the supplier of flexible-packaging and pressure-sensitive materials now projects earnings of 68 cents to 73 cents per share. Bemis posted earnings for its second quarter of 2002 of 82 cents per share.
"We are extremely disappointed by the volume trends this quarter," Jeff Curler, the company's president and chief executive, said in a statement. "Unit sales volumes in polyethylene and paper packaging were lower than expected, as customer order patterns appeared to adjust to increased pricing and sustained economic weakness."
Curler said Bemis is taking action to reduce expenses in the second half or 2003, but the company expects to lower its full-year earnings guidance when it announces its results for the second quarter later this month. He also noted that while sales of high barrier packaging products, excluding the effect of recent acquisitions, rose in the quarter, a competitive price environment, increased pension costs and unusually high legal fees all contributed to lower margins.
Bemis incurred legal expenses of about $2 million during the quarter, related to the trial associated with the Department of Justice complaint filed to block the sale of its pressure-sensitive materials business segment.
Its shares sank 5.44%, or $2.64, during afternoon trading on the
New York Stock Exchange